Not Under the Influence
November 14, 2013 § Leave a comment
Two recent cases, both decided by the COA on October 22, 2013, upheld chancellors’ rulings that decedents’ actions were not the product of undue influence.
In Wheeler v. Wheeler, the court upheld a chancellors’ decision that, although the decedent and his brother had a confidential relationship, the will and deeds in favor of the brother were not the product of undue influence so that they should be set aside.
And in Estate of Mace: Colbert v. Gardner, the court affirmed the chancellor’s refusal to set aside a will based on undue influence. The court also rejected the plaintiff’s claim that the decedent lacked testamentary capacity.
We’ve talked here before about the onerous burden that the plaintiff bears to convince the trial court that a will, deed, or other instrument should be set aside for undue influence. We also talked about the proof necessary to prove lack of testamentary capacity.
The law sets a high bar for those who are seeking to set aside instruments. If you are approached by a prospective client, even one with a fistful of dollars to finance litigation, you should make sure that the proof rises to the level that would justify the relief you are seeking.
You can read these recent cases and draw your own conclusions.
Parol Evidence and the Unambiguous Will
October 29, 2013 § 2 Comments
Every now and then, a lawyer will offer testimony about the testator’s intent, arguing that it is admissible as an exception to the hearsay rule under MRE 802(3), which states:
(3) Then Existing Mental, Emotional, or Physical Condition. A statement of the declarant’s then existing state of mind, emotion, sensation, or physical condition (such as intent, plan, motive, design, mental feeling, pain, and bodily health), but not including a statement of memory or belief to prove the fact remembered or believed unless it relates to the execution, revocation, identification, or terms of the declarant’s will. [Emphasis added]
Once that rule is invoked, like a magical incantation, opposing counsel often sits down and docilely allows the floodgates of testimony to open without further objection, freeing a torrent of testimony that the court must process in its final opinion.
Consider, however, that before the court can hear all those statements of memory or belief, you have to ask yourself whether this parol evidence is admissible in the first place — regardless whether it is or is not hearsay?
In Estate of Black v. Clark, decided by the COA on October 8, 2013, the COA said:
¶5. If the language of a will only allows one interpretation as to how the testator’s property is distributed, the will is unambiguous, and courts may not consider parol evidence to determine the intent of the testator. Stovall v. Stovall, 360 So. 2d 679, 681 (Miss. 1978) (citing Seal v. Seal, 312 So. 2d 19, 21 (Miss. 1975)). Parol evidence may only be considered if the language of the will itself can be construed to result in more than one interpretation as to the disposition of property. Seal, 312 So. 2d at 21.
So before MRE 803 is invoked and parol testimony is allowed, it must be established that the will is ambiguous.
The fact that the parties disagree as to a document’s meaning does not make it ambiguous as a matter of law. Ivison v. Ivison, 762 So.2d 329, 335 (Miss. 2000). In determining the meaning of a writing, the court must employ an objective standard rather than taking into consideration the subjective intent or a party’s belief. Palmere v. Curtis, 789 So.2d 126, 131 (Miss. App. 2001).
The process of contract interpretation adds some insight. In the case of Williams v. Williams, 37 So.3d 1196, 1200 (Miss. App. 2009), that process was set out as follows:
“We have delineated a three-tiered process for contract interpretation. Pursue Energy Corp. v. Perkins, 558 So.2d 349, 351 (Miss. 1990). First, we look to the “four corners” of the agreement and review the actual language the parties used in their agreement. Id. at 352. When the language of the contract is clear and unambiguous, we must effectuate the parties’ intent. Id. However, if the language of the contract is not so clear, we will, if possible, “harmonize the provisions in accord with the parties’ apparent intent.” Id. Next, if the parties’ intent remains uncertain, we may employ canons of contract construction. Id. at 352-353 (citing numerous cases delineating various canons of contract construction employed in Mississippi). Finally, we may consider parol or extrinsic evidence if necessary. Id. at 353″ [West v. West, 891 So.2d 203, 210 (Miss. 2004)]
Rights of a Widow, Part II: Renunciation of the Will
August 13, 2013 § Leave a comment
In Part I, we discussed the right of the widow (which also embraces widowers) to one-year’s support from the estate when the spouse has died. In this post we deal with the right of the widow to renounce a will when it does not make adequate provision for her. The right is codified in MCA 91-5-25.
As we saw in Part I, Joe Howard Estes and Sarah (Young) Estes had been married only nine months when Joe Howard died. Sarah had moved out of Joe Howard’s home and back to her own home shortly after he had suffered from some serious health issues, including amputation of his leg and arterial surgery. She filed for divorce, which was pending at the time of Joe Howard’s death.
Joe Howard’s will, which was admitted to probate, made no provision for Sarah at all, so she filed notice of renunciation with the court, which eventually awarded her a child’s share (1/5) of the estate, less $12,000 that she had been granted as a widow’s allowance.
The co-executors appealed, and the COA reversed in Estate of Estes: Estes v. Estes, decided December 11, 2012. Judge Maxwell, writing for the majority, summed it up:
¶17. Mississippi Code Annotated section 91-5-25 (Rev. 2004) allows a widow whose deceased husband “does not make satisfactory provision” for her in his will to renounce the unsatisfactory provision and elect to take the a child’s share of the estate. See also Bolton v. Barnett, 131 Miss. 802, 827, 95 So. 721, 726 (1923) (holding second husband not provided for in his deceased wife’s will was entitled to inherit a child’s share of his wife’s real property). Under section 91-5-27, when the husband’s will makes no provision at all for his widow, no renunciation is required—it will be assumed that the widow has elected to take her share of the estate. Miss. Code Ann. § 91-5-27. Thus, the chancellor was correct in one sense that the right to inherit under 91-5-27 is “automatic” because, in contrast to the right under section 91-5-25, no act of renunciation or election of a child’s share is required.
¶18. But the chancellor was incorrect that this automatic right to inherit, as if the deceased husband died without a will, arises in every situation without exception. The record shows the chancellor believed his hands were tied regarding Young’s renunciation of Estes’s will and right to inherit one-fifth of the estate. Although acknowledging the evidence supporting Young’s abandonment of the marriage, the chancellor nonetheless awarded her a child’s portion of the estate because he was not aware “of any case law at all that would reflect . . . that [Young] somehow would not be entitled to a child’s portion[.]”
¶19. But there is Mississippi precedent of this nature. Our supreme court has previously acknowledged the operation of estoppel when a spouse trying to take a child’s share of the estate has deserted or abandoned the marriage. In re Marshall’s Will, 243 Miss. at 478, 138 So. 2d at 484 [(1962)]; Walker v. Matthews, 191 Miss. 489, 511-12, 3 So. 2d 820, 826 (1941); Williams v. Johnston, 148 Miss. 634, 636-37, 114 So. 733, 733-34 (1927). In Tillman v. Williams, 403 So. 2d 880, 881 (Miss. 1981), the supreme court clarified what was required for estoppel: “Our Legislature has not seen fit to enact any legislation on this abandonment question. It is, therefore, obvious that the statute has to be strictly construed unless there is a clear desertion and abandonment that sets up the estoppel.”
¶20. While he acknowledged evidence showing Young’s desertion or abandonment of the marriage, the chancellor did not make a finding of clear desertion or abandonment. This was because he mistakenly believed such an estoppel-type finding would have no legal effect on Young’s right to inherit. Since the award of a child’s share of the estate was based on an erroneous application of the law, we reverse the award to Young of one-fifth of the estate and remand for a determination of whether Young’s action met the clear-abandonment standard of Tillman, thus estopping her from inheriting from the Estes’s estate. [Footnotes omitted]
So it is estoppel that will preclude a spouse who has abandoned or deserted the marriage from taking a child’s share. For the estoppel to come into effect the chancellor has to make a finding that “there is a clear desertion and abandonment.”
An interesting sidelight in this appeal is that the appellants did not specifically raise Sarah’s renunciation as an issue in the appeal. How, then, could the COA address it? The COA opinion said this about it at Footnote 5 to ¶16:
While the co-executors did not raise as a separate issue Young’s renunciation of the will, they raised the issue of Young’s abandonment of the marriage and its effect upon Young’s rights, as well as challenged the amount of the award of one-fifth of the estate. Thus, we find the question of the will’s renunciation and Young’s right to inherit a child’s share is before us. But even were it not, reversal based on the chancellor’s misapplication of the law would be warranted under plain-error review. “Plain-error review is properly utilized for ‘correcting obvious instances of injustice or misapplied law.’” Smith v. State, 986 So. 2d 290, 294 (¶10) (Miss. 2008) (quoting City of Newport v. Fact Concerts, Inc., 453 U.S. 247, 256 (1981)); see also M.R.A.P. 28(a)(3) (permitting this court to “notice a plain error not identified or distinctly specified” in the appellants’ statement of issues).
A post that talks about some of the quirks of renunciation can be found at the link.
Rights of a Widow, Part I: Widow’s Allowance
August 12, 2013 § 1 Comment
Joe Howard Estes accumulated a considerable estate during his lifetime. On August 3, 2006, he married Sarah (Young) Estes. Not long after the marriage, Joe Howard suffered health complications that resulted in amputation of a leg and surgery to alleviate an arterial blockage. Later in that same year, Sarah moved out of Joe Howard’s home and back into her own home. She filed for divorce a few months after moving out.
Joe Howard died on May 17, 2007. The divorce action was still pending at the time of his death, and he and Sarah had not resumed cohabitation.
Joe Howard had a will, which his children probated, that made no provision for Sarah.
Sarah filed a petition for one year’s support (widow’s allowance) and exclusive possession of homestead property, renounced the will, and asked for appointment of appraisers.
There ensued several years of litigation between Sarah and Joe Howard’s four surviving children. In the course of the litigation, the chancellor granted Sarah a widow’s allowance of $12,000, and awarded her one-fifth of the estate — a child’s share — of some $80,000, from which he subtracted her $12,000 allowance.
The co-executors appealed.
The COA reversed the trial court in the case of Estate of Estes: Estes v. Estes, decided December 11, 2012. In this post, we’ll look at the court’s ruling on the issue of widow’s allowance.
Judge Maxwell’s opinion explains it clearly:
¶10. A widow or widower who was dependent on the surviving spouse is statutorily entitled to a year’s allowance for his or her maintenance and that of the children, if any. Section 91-7-135 imposes a duty on “the appraisers [of an estate] to set apart out of the effects of the decedent, for the spouse and children who were being supported by the decedent, or for the spouse if there be no such children, or for such children if there be no spouse, one (1) year’s provision[.]” Miss. Code Ann. § 91-7-135. This provision may take the form of money “necessary for the comfortable support of the spouse and children, or spouse or children, as the case may be, for one (1) year.” Id.
¶11. Under section 91-7-141, the chancery court has discretion to “apportion the one year’s allowance, or any part of it, according to the situation, rights, and interests of any of the children or the widow, and may direct the payment of any portion of the allowance which may be found necessary or proper to any of them.” Miss. Code. Ann. § 91-7-141; see also Bryan v. Quinn, 233 Miss. 366, 368, 102 So. 2d 124, 125 (1958) (citations omitted) (“The rule is well settled in this State that the widow’s allowance for one year’s support is within the sound discretion of the chancellor.”).
¶12. While the chancellor relied on this statutory authority to award Young a $12,000 widow’s allowance, Young was not “being supported by the decedent” and, thus, not in need of provision from Estes’s estate to make her comfortable. See Miss. Code Ann. § 91-7-135. So we find the award an abuse of discretion.
¶13. Our supreme court has clarified that the statute “relative to the widow’s allowance provides that such allowance shall be set aside to the widow and children who were supported by the decedent.” In re Marshall’s Will, 243 Miss. 472, 479, 138 So. 2d 482, 484 (1962) (emphasis added). The statute places on the widow “the burden of establishing her claim to a year’s support, [by] showing either that she was being supported by [her husband] at the time of his death or that she was away from him without fault on her part.” Id. Here, Young clearly failed to meet this burden.
¶14. It is undisputed that Young left Estes’s home by her own volition after his leg was amputated. And she was living in her own home at the time Estes died. In Byars [v. Gholson, 147 Miss. 460, 465, 112 So. 578, 578-79 (Miss. 1927)] , the Mississippi Supreme Court held that a widow who had been living apart from her husband, without his fault, and who was not supported by him, was not entitled to one year’s support from his estate. Byars, 147 Miss. at 465, 112 So. at 578. We find the same is true here.
¶15. Because we find the widow’s allowance was not supported by substantial evidence of Young’s financial dependence on Estes at the time he died, the chancellor abused his discretion in awarding Young one-year’s support. We reverse the award of a $12,000 widow’s allowance and render judgment against Young’s claim to one-year’s support. [Footnotes omitted]
I think that there is a widespread belief that the widow’s allowance (that term embraces widower’s allowance also) is automatic, and that the only issue is how much. That’s not so, as Estes tells us.
In Part II, we’ll address how the COA dealt with Sarah’s rights due to renunciation of the will.
Speculation About Undue Influence Will Not Win the Case
August 8, 2013 § 1 Comment
We’ve talked here before about what one needs to prove to make out a case of undue influence in a will contest. It’s not an easy case to make, and the proof must be clear and convincing
In the COA case of Estate of Strong: Johnson, et al. v. Washington, handed down July 16, 2013, contestants Johnson, Foster, Miller and Wright claimed that their father, Rev Strong, had been subjected to undue influence when he executed a will in 1986. Washington came to be appointed executrix of the contested will.
Under the terms of the will in question, Rev. Strong left $10,000 to Miller, and bequeathed some real property to Wright. All of the residuary estate went to his wife, Earnestine, who was the step-mother of the contestants. Johnson and Foster were disinherited.
The parties engaged in discovery, following which Washington filed a motion for summary judgment.
The contestants filed three affidavits in oppositiion to the motion, alleging that Earnestine had been controlling, and that Rev. Strong had stated on many occasions that he regretted marrying her. They averred that Earnestine would not even allow the contestants into the home to visit their father. The contestants admitted that their father had testamentary capacity at the time he executed the will, and that he was of sound mind, They emphasized that Rev. Strong was a private person who handled his own financial and business affairs. There was no proof that Rev. Strong was in poor health or suffered from any condition that made him dependent on Earnestine. The record also established that Earnestine was not present when Rev. Strong executed the will, and that he kept it in a safe deposit box to which Earnestine did not have access.
If the contestants made a triable issue for a jury, then, it turned on their allegations that Earnestine was overbearing and controlling. Did they make a case sufficient to get by MRCP 56?
The chancellor ruled that they did not, granted summary judgment, and the contestants appealed.
Here is how the COA addressed the issues, per Judge James:
¶12. The only evidence the Contestants have to support their assertion of undue influence is the three affidavits alleging that Earnestine was overpowering and controlling toward Rev. Strong. However, not one of the affidavits contains specific facts showing that Rev. Strong was improperly influenced by Earnestine during the execution of the disputed will. The Contestants’ blanket allegations do not pass muster to show a triable issue. “The trial court should only submit an issue to the jury when the evidence creates a question of fact over which reasonable jurors could disagree.” In re Last Will & Testament & Estate of Smith, 722 So. 2d 606, 611 (¶17) (Miss. 1998) (citing Vines v. Windham, 606 So. 2d 128, 131 (Miss. 1992)). Here, the evidence does not formulate a factual question over which reasonable jurors could disagree.
¶13. “A presumption of undue influence arises in a will contest when a beneficiary occupies a confidential relationship with the testator and there is active participation by the beneficiary in either procuring the will or in preparing the will.” [In re Last Will and Testament of] Smith, 722 So. 2d [606] at 611-12 (¶18) (citing Simm v. Adams, 529 So. 2d 611, 615 (Miss. 1988)). However, the existence of a confidential relationship, alone, does not automatically raise a presumption of undue influence. [In re Estate of] Laughter, 23 So. 3d [1055] at 1064 (¶37) (citing Wright v. Roberts, 797 So. 2d 992, 999 (¶21) (Miss. 2001)). There must be circumstances where the beneficiary in the relationship took some active part in preparing the will. Id. (citing Croft v. Alder, 237 Miss. 713, 723-24, 115 So. 2d 683, 686 (1959)). There is no evidence of undue influence here. As previously mentioned, there is nothing in the record to suggest that Rev. Strong was dependent upon Earnestine in any capacity. According to the Contestants, Rev. Strong was very independent and handled his own financial affairs. Earnestine was never granted power of attorney during their marriage. Furthermore, there is no evidence that Earnestine actively participated in the will’s preparation or was present during its execution.
The court also quoted from In re Estate of Pigg, 877 So.2d 406, 412 (Miss. App. 2003) as to what the contestants need to show to make a jury issue:
[¶10] … Those contesting a will need not present sufficient evidence to prove undue influence. The contestants, however, must at least raise sufficient question to cause jurors to conclude that the proponents failed to prove that the will was free of improper influence[.] . . . The jurors had to decide if the inferences of undue influence made the quantum of evidence in support of due execution less than a preponderance. The best evidence on the issue was the testimony of the subscribing witnesses and others who were present during the execution. From no one contemporaneously involved . . . was there any suggestion that Mrs. Pigg was unaware of what she was doing or that her personal desires had been overwhelmed by someone else. Doubts about due execution that arise solely from speculation are insufficient. That would be too light a counterweight to the evidence of proper execution. [Emphasis in original].
The counterweight sufficient to overcome evidence of proper execution is clear and convincing evidence that the the dominant person in the relationship was in a position to exercise undue influence due to the other’s weakness of mind or body, or due to trust, and it has to be proven by clear and convincing evidence. It’s not necessarily whether the dominant person did or did not exercise dominant influence; rather, the issue is whether he was in a position to do so. If the answer to the inquiry is that there is clear and convincing evidence that the dominant person was indeed in a position to exercise undue influence, the presumption arises, and the burden shifts.
In this case the contestants’ proof fell short because they could only speculate that their father acted against his true wishes, and they had no proof that Earnestine was actually in a position to exercise undue influence. The mere facts that she was domineering and even alienating were not enough.
WHOSE ACCOUNT IS IT, ANYWAY?
April 15, 2013 § 2 Comments
Remember that every pleading in an estate, guardianship and conservatorship must be signed by the fiduciary, and not the attorney or anyone else. And that includes “accounts and reports.” That’s what UCCR 6.13 expressly states.
In your mad frenzy to avoid a show-cause order, it sometimes seems expedient to bypass that sluggish fiduciary altogether and just do it yourself, but if you sign that motion, or that account, or that inventory, you have really accomplished nothing. It’s the fiduciary who is on the line, and her name needs to be on the dotted line.
And, although it is the fiduciary’s account, strictly speaking, you stand to suffer the slings and arrows of outrageous fortune yourself if the case is delinquent. UCCR 6.17 says, “If, without cause, an attorney fails to file accountings or other matters in probate cases … after being so directed in writing by the Court, the Court may consider such misconduct as contempt.”
WHAT IS YOUR DUTY WHEN YOUR FIDUCIARY-CLIENT IS DERELICT IN HIS DUTIES?
April 11, 2013 § 2 Comments
It seems to be a more and more frequent problem that when we issue orders in delinquent estates, an attorney pops up and says something like, “Well, judge, the reason we haven’t filed an inventory, or any accountings since 1997 is that I lost contact with the fiduciary.”
Who’s got the problem in that situation?
Well, UCCR 6.02 says this about that:
In guardianships and conservatorships an attorney must be faithful to both fiduciary and the ward and if it appears to the attorney that the fiduciary is not properly performing duties required by the law then he shall promptly notify the Court in which the estate is being administered. Failure to observe this rule without just cause shall constitute contempt for which the Chancellor will impose appropriate penalties.
And what exactly are those “duties required by law?” Here’s what UCCR 6.02 says:
Every fiduciary and his attorney must be diligent in the performance of his duties. They must see to it that publication for creditors is promptly made, that inventories, appraisements, accounts and all other reports and proceedings are made, done, filed and presented within the time required by law, and that the estates of decedents are completed and assets distributed as speedily as may be reasonably possible.
It’s pretty clear from the language of the rule that your neck is in the noose along with your fiduciary. If the requirements are not met, you are as responsible for the lapse as is your fiduciary. Oh, and explaining to the chancellor that you had no idea that the Uniform Chancery Court Rules had this provision will in all likelihood only make things worse.
Here are some helpful posts from the past … Five Mistakes that Fiduciaries Make … Five More Mistakes that Fiduciaries Make … Approaching Zero Tolerance … and … Essential Procedures in Guardianships and Conservatorships.
If the landscape of your probate practice is littered with failures to file accountings, inventories and other reports, and you have estates that due to sheer neglect are languishing unclosed far beyond what is reasonable, look no farther than yourself for a place to lay the blame. That’s where the judge will look.
STANDING TO FILE A CLAIM AGAINST AN ESTATE
April 2, 2013 § 3 Comments
The COA decision in Estate of Necaise: Covington v. McDaniel, decided March 12, 2013, addresses the question whether a judgment creditor of the potential heirs of an estate has standing to assert a claim against the estate.
Lawrence Covington probated a claim against the estate of Darryl Necaise, Sr., based on a $1,000,000 judgment he had obtained against three of the decedent’s heirs in the Circuit Court of Yalobusha County. The proceedings are convoluted, involve three separate appeals, all consolidated, and even a separate circuit court proceeding. For our purposes, however, we are focusing on the sole issue of Covington’s standing to assert a claim against the estate when the judgment forming the basis of his probated claim was against some of its heirs, and not against the decedent or the estate itself.
Judge Carlton, for the court, spelled out the answer:
¶23. Covington’s appeals regarding the findings of the chancery court primarily arise out of his claim to be an interested party to the probate proceedings and the contest of Darryl Sr.’s will based upon his pecuniary interest in his judgments against potential heirs of the Estate. In support of his argument, Covington relies on Mississippi Code Annotated section 91-7-25 (Rev. 2004), which states that “[i]n any proceeding to contest the validity of a will, all persons interested in such contest shall be made parties.” Significantly, Covington does not assert on appeal that a judgment was entered against the Estate or Darryl Sr., the decedent.
¶24. Relying upon precedent, this Court recognizes that “[i]nterested parties are those whose direct[] pecuniary interests will be either detrimentally or advantageously affected by the probate of the will. Included in this group will ordinarily be [the] decedent’s heirs at law, beneficiaries under earlier wills, and beneficiaries under the will being contested.” Garrett v. Bohannon, 621 So. 2d 935, 937 (Miss. 1993) (emphasis added and citation omitted). With respect to the claim asserted by Covington, we find that Covington failed to prove he possessed a direct pecuniary interest against the Estate. Moreover, the only heir named in Darryl Sr.’s will, McDaniel, never contested the will. In fact, McDaniel, as the executor, had Darryl Sr.’s will admitted to probate; she possessed no duty to notice any parties except creditors of the Estate, which she alleges she accomplished by publication as required. As previously discussed, Darryl Sr.’s former spouse abandoned any intent to contest the will admitted to probate.
¶25. Covington asserts no direct pecuniary interest in the probate of the Estate. Covington is not a creditor of the Estate and identifies no debt or expense owed to him by the Estate or Darryl Sr., the deceased. Further, Covington is not an heir-at-law of the decedent nor a named beneficiary in any will alleged to have been executed by the decedent. In fact, Covington is not a judgment creditor of the sole heir of the estate, McDaniel. Therefore, Covington fails to establish standing to assert a will contest that would never result in him being a beneficiary of the assets of the Estate. His only connection to the Estate is that he tried, yet failed, to obtain a judgment against Darryl Sr. and the Estate. As such, we find this issue to be without merit.
An interesting twist in this case is how Covington attempted to assert himself into the proceedings as to the validity and enforceability of the will itself. I had never seen a party claiming to be a judgment creditor try to assert those kinds of issues in the probate of an estate.
Chancellor Vicki Cobb apparently considered the issue of standing so clear-cut that she assessed sanctions against Covington. You might want to add the possibility of sanctions into the equation before you leap into filing something similar yourself.
IF YOU CAN’T TRUST A TRUSTEE, WHO CAN YOU TRUST?
March 5, 2013 § Leave a comment
“In God we trust; all others pay cash.” — Graffiti
A trust is aptly named. Its grantor literally trusts the trustee to carry out his or her wishes with respect to the money or property placed in the trustee’s care.
In the case of Smiley v. Yllander, handed down December 11, 2012, by the COA, the chancellor found at trial that Jeanette Smiley had created a trust when she deeded her home and 140 acres to her nephew, Gary, and his wife, Mary Ann. The deed by which she conveyed the property included this provision:
This conveyance is executed trusting that Gary Lamar Smiley will follow the dictates of my Last Will and Testament with regard to the disposition of the above described property. In the event, however, that said Gary Lamar Smiley should predecease me, then, in that event, his executor/administrator shall follow the dictates and dispose of said property according to my Last Will and Testament.
By her express language, then, Jeanette trusted Gary to deal with her estate as directed in her will.
Alas, as sometimes happens, things did not go as Jeanette had envisioned. Gary and Mary Ann clearcut timber on property specifically reserved in the will for other family members, and the other family members sued, not only for the wrongful timber removal, but also alleging that Mary Ann had misappropriated over $100,000 of Jeanette’s money.
The chancellor found that the deed created a trust and awarded the plaintiffs $292,000 for removal of the timber, and another $44,000 for misappropriation.
Gary and Mary ann appealed.
The COA reversed and remanded the trust issue because the chancellor was unclear about the standard of proof that she applied. Judge Maxwell’s opinion is a good primer on the law of creation of trusts and the burden of proof required for each. Here’s what he wrote:
¶11. Generally, trusts are classified under two broad categories: (1) express trusts and (2) implied trusts. Express trusts arise from a party’s manifestation of an intention to establish such an agreement and are created by a trust instrument. Miss. Code Ann. § 91-9-103(a) (Supp. 2012). If the trust holds real property as an asset, the trust agreement must be in writing and signed by the grantor. Miss. Code Ann. § 91-9-1 (Rev. 2004); Alvarez v. Coleman, 642 So. 2d 361, 366-67 (Miss. 1994).
¶12. While an express trust must be written, implied trusts differ in that they arise by implication of the law or are presumed from the circumstances. Mississippi recognizes two types of implied trusts: (1) resulting trusts and (2) constructive trusts. A resulting trust “is designed to give effect to the unwritten but actual intention of the parties at the time of the acquisition of title to the affected property.” In re Estate of Gates, 876 So. 2d 1059, 1064 (¶17) (Miss. Ct. App. 2004) (quoting Robert E. Williford, Trusts, 8 Encyclopedia of Mississippi Law § 73:2, at 422 (2001)). A constructive trust is a judicially imposed remedy used to prevent unjust enrichment when one party wrongfully retains title to property. McNeil v. Hester, 753 So. 2d 1057, 1064 (¶24) (Miss. 2000). The primary difference between the two is that “in a resulting trust, the acquisition . . . is mutually agreeable[,] and the inequity arises out of the trustee’s subsequent unwillingness to honor the terms of the parties’ original agreement”; whereas a constructive trust may be imposed when “acquisition of title is somehow wrongful as to the purported beneficiary[.]” Simmons v. Simmons, 724 So. 2d 1054, 1057 (¶7) (Miss. Ct. App. 1998).
¶13. Here, the chancellor found a trust existed but did not distinguish the particular type. Though both parties insist the chancellor imposed a constructive trust, or something akin to it, a plain reading of her order shows she likely found Jeanette had intended to create an express trust by executing the deed “trusting” Gary would follow the dictates of her will—which did in fact leave the ninety-acre tract to the plaintiffs. According to the chancellor, the deed “was subject to the terms of the will and did not serve to vest fee title in the Smiley Defendants.” That the chancellor likely believed an express trust, rather than implied trust, arose is further supported by her finding that Gary and Mary Ann had “knowingly and willfully violated the explicit terms of that trust.”
¶14. But regardless of the type of trust implicated, “to establish a trust, the evidence must be more than a mere preponderance. The proof must be clear and convincing.” Lee v. Yeates, 256 So. 2d 371, 372 (Miss. 1976) (emphasis added). And here, it is not at all obvious whether this standard was employed. We note that in the chancellor’s order indicates she found:
Plaintiffs have met their burden of proof by a preponderance of the evidence on all necessary elements and are entitled to recover for the wrongful removal of the timber from the acres devised to them under the terms of the will. Even though the property was conveyed to the Smiley Defendants, such conveyance was specifically subject to a trust for Plaintiffs’ benefit, and the Smiley Defendants knowingly and willfully violated the explicit terms of that trust. (Emphasis added).
While the chancellor may have indeed considered the trust issue separately under the clear-and-convincing-evidence standard, she did not specifically say so in her order. This omission, coupled with the chancellor’s reference to the preponderance standard when describing the burden of proof “on all necessary elements,” supports our decision to remand to ensure the chancellor considers the trust issue under the clear-and-convincing-evidence standard. See Estate of Langston v. Williams, 57 So. 3d 618, 622 (¶17) (Miss. 2011).
Aside from the nifty trust-law-in-a-nutshell aspect of this case, it illustrates what can happen when the trial judge applies the wrong standard of proof or is unclear whether she applied the right standard. You can avoid this kind of result by offering to do proposed findings of fact and conclusions of law that set out and cite authority for the appropriate standard. Or, if you aren’t that industrious, timely file an MRCP 59 motion asking the judge whether she really meant “clear and convincing” rather than preponderance, and cite a supporting case or two. It might just save you a retrial.
THE HIGH COST OF FALLING OUT OF LOVE
February 14, 2013 § Leave a comment
A contract to devise property by will is enforceable under Mississippi law. It’s not something one sees every day, but it is something one bumps into every now and then.
Take the case of Hall v. Lewis, decided February 12, 2013, by the COA, a most appropriate case to look at on Valentine’s Day.
Howard Hall and Varnell Lewis were in love. They had been involved in a romantic relationship for several months when, in 1998, Howard purchased a piece of property in his sole name and built a home on it at his expense. At the time of trial in this case, many years later, the property was valued at $80,000.
In 1999, Howard and Varnell, still lovebirds, executed a document entitled “Intervivous [sic] and Testamentary Contract” [is the proper use of Latin phrases yet another thing they’ve stopped teaching in law school?] and each executed a will. The contract provided that Varnell would have a life estate in the property, or have one-half of the proceeds if sold during her lifetime, or have a life estate in any property acquired to replace the property. The agreement required both of them to execute a will contemporaneously to effect its terms. The agreement also provided that it “shall remain in full force and effect and may not be changed by either party,” and “a violation of this agreement may result in a suit for damages for the value of the property.”
By 2005, Howard and Varnell, alas, were out of love, and they parted ways. Howard changed his will to make his grown children the sole beneficiaries and devisees, cutting Varnell completely out.
In 2007, Varnell tried to move a mobile home onto the property based on her contract rights, but Howard refused. Varnell filed suit to enforce the contract, and the chancellor ruled in her favor that it was, indeed, an enforceable contract. Based on the final sentence of the contract as to damages, the judge awarded Varnell a judgment for $40,000 against Howard, and ordered that, upon payment of that amount, Varnell’s right to a life estate would be extinguished. Howard appealed.
After disposing of Howard’s assertion that he did not actually sign the contract, Judge Ishee’s opinion states:
¶10. Additionally, Mississippi law provides that a contract to devise or bequeath property by will is enforceable. Williams v. Mason, 556 So. 2d 1045, 1048 (Miss. 1990) (citing Trotter v. Trotter, 490 So. 2d 827, 830 (Miss. 1986) (citation omitted)). With regard to oral promises to devise property, the Mississippi Supreme Court has held that “[a] will, when written in conformity and compliance with the agreement, was a consideration which belonged to the appellee. The testator had no right to revoke it, and its attempted revocation, if deliberately made, constituted a fraud upon [the appellee.]” Johnson v. Tomme, 199 Miss. 337, 347, 24 So. 2d 730, 732 (1946).
¶11. Here, not only did Hall’s and Lewis’s wills reflect the agreement between them, the agreement itself was written by an attorney, signed by both parties, and notarized. This constitutes “clear, definite[,] and certain evidence” of the parties’ intentions. Trotter, 490 So. 2d at 830. Hall’s assertion that the contract is unconscionable is, therefore, also meritless. Accordingly, we cannot find error in the chancery court’s enforcement of the contract.
As illustrated in this case, a contract to bequeath or devise property by will is one of those planning tools that can be used to help unmarried parties to formalize their relationships, as I have discussed here before. You will want to be sure you advise them both in advance, in writing and acknowledged by each of them, that the contract may not be unilaterally rescinded later.
Another interesting point in this case is that the appellant’s 19-page brief cited not a single authority in support of the argument. As the opinion pointed out, “Failure to cite authority to support an argument renders an issue procedurally barred.”
Finally, it’s a hard but immutable principle of law that falling out of love is simply not a reason to abrogate any legal agreement. Happy Valentine’s Day!
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