California Code, Civil Code - CIV § 731.15

(a) All ordinary expenses incurred in connection with the principal or with its administration and management, including regularly recurring taxes assessed against any portion of the principal, water rates, premiums on insurance taken upon the estates of both tenant and remainderman, interest on mortgages on the principal, ordinary repairs, compensation of assistants and court costs on regular accountings, except attorneys' fees, shall be paid out of income.  But such expenses where incurred in disposing of, or as carrying charges on, unproductive property as defined in Section 731.13, shall be paid out of principal, subject to the provisions of subdivision (b) of Section 731.13.  Attorneys' fees for ordinary or current services shall be paid one-half out of income;  one-half out of principal or in such other proportion as the court may direct.

(b) Attorneys' fees and other costs incurred in maintaining or defending any action to protect the property or assure the title thereof, unless due to the fault or cause of the tenant, costs of, or assessments for, improvements to property forming part of the principal, brokers' commissions, title charges, and other costs incurred in connection with purchasing, selling, or leasing property, or investing or reinvesting principal, and all other expenses, except as specified in subdivision (a) of this section, shall be paid out of principal.  Any tax levied by any authority, federal, state, or foreign, upon profit or gain defined under the terms of subdivision (b) of Section 731.05 shall be paid out of principal, notwithstanding such tax may be denominated a tax upon income by the taxing authority.