Trusts & Estates – Will Caveat – Inter Vivos Property Transfer – Undue Influence

In re Estate of Seagraves. (Lawyers Weekly No. 10-07-0792, 31 pp.) (Linda Stephens, J.) Appealed from Cabarrus County Superior Court (Paul C. Ridgeway & Michael E. Beale, JJ.) N.C. App.

Holding: Where the defendant admitted that a fiduciary relationship existed between him and the testator at the time the testator transferred to him a 3.2-acre tract, the burden therefore shifted to the defendant to demonstrate that the transfer was not the result of undue influence. Summary judgment was not proper on the issue of the conveyance of the 3.2-acre tract due to the existence of genuine issues of material fact.

The trial court’s order granting partial summary judgment is reversed.

Facts

The will of an elderly widow, Pauline, devised all her real property to her four sons in equal shares. Donald, Pauline’s son, drove her to an attorney’s office, where she executed a new will, devising 65.5 acres of property to Donald, 14.1 acres to Bobby and a 1.6-acre home site to Harold and Wayne.

Subsequently Pauline conveyed a 3.2-acre tract out of Bobby’s 14.1-acre tract to provide Donald a right-of-way to his property after her death. Later Pauline conveyed an 8.9-tract out of Bobby’s 14.1-acre tract to Donald and his wife.

Pauline suffered from ill health during the period of the conveyances and then passed away.

Bobby filed suit against Donald and his wife alleging that they exercised undue influence over Pauline and sought to set aside the conveyances of the 3.2- and 8.9-acre tracts from Pauline to Donald and his wife. Harold, Wayne and Bobby also filed a caveat to the probate of Pauline’s will, alleging lack of testamentary capacity and undue influence.

The trial court entered summary judgment in favor of Donald as propounder in the probate matter. The caveators appealed, and after a trial the jury returned a verdict that the will was executed properly. The caveators appealed.

The trial court entered summary judgment in favor of Donald and his wife on issues related to the 3.2-acre deed. Bobby voluntarily dismissed his claims regarding the conveyance of the 8.9 acres.

Bobby appealed the entry of summary judgment related to the 3.2-acre deed.

Property Transfer

The four general elements of undue influence include a showing of: (1) a person who is subject to influence, (2) an opportunity to exert influence, (3) a disposition to exert influence, and (4) a result indicating undue influence.

Bobby argued that a fiduciary relationship existed between Donald and Pauline and that this created a presumption of undue influence for the execution of the deed to the 3.2-acre tract. In light of Donald’s admission in his answer, we agree that such a relationship did exist at the time of Pauline’s conveyance to Donald of the deed to the 3.2-acre tract.

When a fiduciary relationship exists between a propounder and testator, a presumption of undue influence arises, and the propounder must rebut that presumption.

Accordingly, summary judgment was not proper on the issue of the conveyance of the 3.2-acre tract due to the existence of genuine issues of material fact. Therefore, the trial court’s order granting partial summary judgment on that issue is reversed.

Caveat Proceeding

Pauline executed a power of attorney in favor of Donald contemporaneously with the execution of the new will. The evidence indicates that Donald did not learn of the power of attorney until after it was executed. This alone, therefore, does not establish the existence of a fiduciary relationship.

Moreover, the power of attorney was not recorded until almost two years after the will was executed. There is no evidence that Donald ever served as Pauline’s attorney-in-fact.

Accordingly, we hold that as a matter of law that a fiduciary relationship did not exist between Donald and Pauline at the time Pauline executed the will.

The burden of proving undue influence is on the caveators, and they must present sufficient evidence to make out a prima facie case in order to take the case to the jury.

The caveators need not demonstrate every factor named in In re Will of Andrews, 299 N.C. 52 (1980), to prove undue influence, as undue influence is generally proved by a number of facts, each one of which standing alone may be of little weight, but taken collectively may satisfy a rational mind of its existence.

Pauline was 90 years old when she executed the new will. Although her medical problems did not reflect on her mental capacity, we nevertheless conclude that the first Andrews factor weighs in favor of the caveators.

As to the second factor, that the person signing the paper was in the home of the beneficiary and subject to his constant association and supervision, the caveators have not shown that Pauline was subject to Donald’s constant association and supervision.

The caveators’ evidence in support of this factor includes only events that occurred months or years after the execution of the will.

With regard to factor three, there is no evidence that Donald denied other members of the family access to Pauline, and the caveators’ own testimony indicates that they had unfettered access to visit with and speak to Pauline.

As to factor four, the parties acknowledged that that the will is different from and revokes a prior will, so that factor weighs in the caveators’ favor.

Factor five, that the will was made in favor of one with whom there are no ties of blood, weighs against the caveators, as the will is in favor of Pauline’s four natural children, regardless of whether the children’s shares are equal.

Factor six, that the will disinherits the natural objects of the decedent’s bounty, also weighs against the caveators, as Pauline’s will divides her property solely among her four children.

The seventh factor, that the beneficiary has procured the will’s execution, weighs against the caveators’ argument as well.

All of the evidence from those individuals with personal knowledge of the execution of the will supports Donald’s contention that he did not procure the will.

The caveators have not forecast any relevant, admissible evidence from which a jury could reasonably decide that when she executed her will, Pauline was not acting of her own free will, but rather was acting under the undue influence of Donald.

Capacity

The caveators contend that the trial court erred in granting Donald’s motion for summary judgment on the issue of testamentary capacity.

To establish testamentary incapacity, the caveators need only show that one of the essential elements of testamentary capacity was lacking.

Pauline’s deteriorating health and mental confusion was insufficient to show that she lacked testamentary capacity at the time she executed her will.

Reversed in part; affirmed in part.