Posts Tagged ‘mental capacity’

Even Lawyers Can Have Trouble Recognizing Undue Influence

OCTOBER 20, 2014 VOLUME 21 NUMBER 38

We often say that experienced lawyers can be pretty good at judging the competence of a client to make a will, sign a power of attorney or execute other documents. We (collectively) probably make better witnesses on those questions than even the doctors and medical staff attending to their patient (our client). Why? Not because we have better medical training — we obviously don’t. What we are better at is applying the legal tests of capacity to the person we meet with. “Can you name your family members?” and “What do you think a will is designed to do?” are questions that just don’t come up in most medical interviews.

What we are less good at, though, is recognizing undue influence. Of course we know the markers (social isolation, big changes in estate plans, active involvement by the person benefiting from the change, etc.), but we don’t see the daily interaction between our clients and their family members. That can make it easy for us to miss the significance of the influence brought to bear on our clients, even if we are vigilant and familiar with the circumstances and possibilities.

That concept was brought home this week while reviewing a recent California Court of Appeals case. Two brothers disputed the validity of a series of documents their mother had signed, and all were prepared by lawyers after close questioning by each. The two lawyers heard very different stories, and within days or weeks of one another. How could this have happened, and was there a way to avoid it in other cases?

The California case, Bellows v. Bellows (October 9, 2014), is an “unreported” decision. That means that it can’t be cited as a precedent in other, similar cases — but it doesn’t change the validity of the appellate court’s holding. That holding: the most recent documents signed by the mother were valid, at least partly because the contesting brother could not meet his burden of proving otherwise. But the story of battling lawyer visits was more poignant than the ultimate court holding was significant.

The saga began in 2002, when Ms. Bellows’ brother became ill. Her son Fred helped her deal with her brother’s illness, need for care, and ultimate death — and even the probate of his estate. After she inherited about $400,000 from her late brother, she and Fred visited her attorney about estate planning, and her stockbroker about setting up an account to hold the inherited money.

Ms. Bellows’ will and trust had previously provided for an equal division between her two sons, Fred and Donald. The upshot of the meetings with lawyers and stockbrokers was that Fred would inherit all of the money that Ms. Bellows had received from her late brother, and the balance of her estate would be divided equally between Fred and Donald.

It is worth noting that Fred went with his mother to most or all of her meetings with her stockbroker and her lawyer, though her lawyer took care to discuss her wishes in a separate session without Fred in the room. Her lawyer was certain that the changes she requested were her wishes, and that she was not being unduly influenced by her son.

About six months after those changes were completed, Ms. Bellows visited another lawyer — this time in the company of her other son, Donald. The new lawyer began the process of reviewing her existing estate planning documents, and considered her request for a change in the disposition she had planned. That new lawyer wrote to the lawyer who had prepared Ms. Bellows’ earlier documents, requesting a copy and more information.

The day after that meeting, Ms. Bellows was back in the original lawyer’s office with her son Fred. She told the first lawyer that she did not want to make any changes, and that she did not want to deal with the new lawyer any further. The first lawyer wrote to the new lawyer to tell her not to take any further action.

Nonetheless, Ms. Bellows was once again in the second lawyer’s office two days later. She signed a new power of attorney naming Donald as her agent rather than Fred, and she amended her trust to provide for equal distribution of all of her assets, including the inheritance she had previously earmarked for Fred. The second lawyer later testified that she was clear about her wishes, not being directed by Donald and could express her own wishes without any hesitation.

Shortly after those changes were made, the first lawyer visited Ms. Bellows at her apartment. She told him that she wanted Fred, not Donald, as her agent, and the lawyer prepared yet another power of attorney for her to sign. Since the beneficiary designation on the account holding her inheritance had never actually been changed, the first lawyer made no further changes.

When Ms. Bellows died three years after that sequence of events, the two brothers fought about whether there had been undue influence. Each pointed to the interviews their mother had had with the lawyers as evidence that the other had acted inappropriately. As the Court of Appeals noted, each of those two lawyers “apparently thought they were helping [her] resist improper pressure from the other brother.”

As noted in the introduction, the upshot was that the beneficiary designation favoring Fred was upheld, though mostly on the basis that Donald had not met his burden of proving undue influence in order to set it aside. But the real lesson, it seems to us, is that two lawyers — who we will assume (as the Court of Appeals did) were both well-meaning — could hear such different stories within days of one another.

What might either of those lawyers have done differently, in order to help make Ms. Bellows’ wishes clear? It is a challenge, but we have some ideas we follow:

  1. Never start a client meeting with the family — meet first and alone with the client. If either lawyer could have said that they took no direction from either of Ms. Bellows’ sons, it would have been more powerful defense of their position. Who knows what she might have said if there was no opportunity for prompting or direction? A visit without either son present is good, but perhaps it should be clearer that neither son should have been actively involved at all.
  2. Outside information might have been helpful to judge the effect on the client. The record is not clear as to whether either attorney asked for information from doctors, social service workers, psychologists, caretakers or others about Ms. Bellows’ daily life, and how susceptible she might have been to direction from others (including either or both of her sons).
  3. Once such clear conflicts have been exposed, it’s time to step up the efforts to eliminate inappropriate influence. If, as the Court of Appeals suggested, the two lawyers each thought they were protecting Ms. Bellows from the other lawyer and the brother who was seen as the “real” motive force, perhaps they would both have served Ms. Bellows better if they had discussed their different views, figured out a way to reconcile them, and give Ms. Bellows the peace of mind that her wishes were in place and would not be changed at the insistence of either son. After all, Ms. Bellows’ peace of mind should have been a primary goal of her representation.

Can a Person with Dementia Sign Legal Documents? (Part 2)

MARCH 4, 2013 VOLUME 20 NUMBER 9
Last week we posed the question, and then mostly wrote about competence (or capacity) to sign a will. We promised to explain more about the level of competence required to sign other documents. So let us now tackle that concept.

A person with a diagnosis of dementia may well be able to sign legal documents, at least in Arizona. We suspect that the answer should be pretty much the same in other states, but if you are curious about your own state you should check with a local attorney about how competence is determined.

Generally speaking, competence or capacity is usually analyzed situationally. That is, the question will be answered differently depending on the nature of the document and the circumstances of the signing. The general rule: the signer has to have sufficient understanding to know what the document is, and the effect of the signing.

What kinds of documents might be involved? There are a variety of contexts in which capacity can be difficult to assess, including (but not limited to):

  • Ability to sign a contract — say to buy a car, or build a home.
  • Understanding of a power of attorney, which might give the authority to another person to sign future documents.
  • Competence to sign a trust, which might have elements of agency (like a power of attorney) and testamentary effect (like a will).
  • Capacity to get married (which is, after all, a specialized kind of contract).
  • Ability to make medical decisions — including refusing medication, or either seeking or declining mental health treatment.

Each of those situations, and the dozens of others that might arise, will be judged differently, because the nature and effect of the act will be different. But we can generalize about several of the important rules that cut across types of documents:

  • Minority is presumptive incapacity. That is, a person under age 18 does not have the legal ability to enter into a contract, get married, sign a trust (or will), or make medical decisions for themselves. There are, however, exceptions — a contract for “necessaries” (food, shelter, etc.) may be enforceable if signed by a minor. An “emancipated” minor may be able to do some things that an unemancipated minor can not.
  • It may not be necessary to have capacity to do the underlying thing before giving the authority to someone else. What? Let us explain: a person who might not have the capacity to enter into a complicated contract might still have sufficient capacity to sign a power of attorney giving someone else the power to sign the contract.
  • Arizona’s legislature has decided that the capacity level required to sign a trust should be the same as testamentary capacity, as we described last week. That may mean that someone who does not have sufficient capacity to sign a power of attorney could nonetheless sign a trust, which gives even broader authority to the trustee. Odd result, but mostly theoretical, as it’s hard to find someone in just that circumstance.
  • Generally speaking, most observers think that the capacity to sign a will is a lower level of competence than contractual or other forms of capacity. But it might not be that hard to describe someone who adequately understands the nature of a power of attorney but does not have an understanding at the level of testamentary capacity.
  • There are few legal ways to determine capacity in advance. Challenges to capacity are almost always initiated after the signing is completed — and often after the signer has died, or become completely and undeniably incompetent. That means that evidence of capacity (or lack of capacity) is often being reconstructed well after the fact.

It’s also important to remember that we are writing here about competence/capacity, and not necessarily about the validity of documents signed by someone with dementia. In response to our article last week, one reader wrote to us:

“You covered dementia issues very clearly. Thank you! But what about the issue of undue influence in the presence of known dementia where, in principle, the demented person otherwise possesses testamentary capacity? How does the mix of those two aspects play out?”

It’s a very good point. There is a difference between capacity (or competence) on the one hand, and undue influence on the other. Dementia might make a given signer incapable of signing a document, or their competence may be sufficient to sign. But that same person might be made more susceptible to undue influence because of their dementia.

What do we mean? Let’s give an example — drawn from our considerable experience with the distinction. An elderly widower, living alone, has a diagnosis of dementia. He is nonetheless charming, witty and perfectly able to discuss his wishes. He can recall the names of his three children, and of his seven grandchildren. He can report their ages, the cities they live in and their careers (or status as students) — and he is mostly correct, though sometimes his information is two or three years out of date.

This gentleman’s daughter lives in the same city, and is the one who oversees his living arrangements and care. She does his shopping, hires people to check on him daily, takes him to doctors’ appointments, writes out his checks (he still signs them) and otherwise helps out. She also talks to him endlessly about how his other two children don’t deserve to end up with his house and bank accounts, how she really ought to be the one who benefits from his estate, and how his late wife (her mother) always wanted her to inherit everything. Eventually he agrees to sign a new will and trust, mostly to stop her constant harangues.

Was he competent to sign the new estate planning documents? On the facts as we’ve given them here, probably yes. Was he unduly influenced? Very likely. Was that influence facilitated (and the proof made easier) because of his dementia? Absolutely.

When did the daughter’s behavior cross the line? The legal system isn’t actually very helpful, since the answer is defined in a circular fashion. Her influence was “undue” when it resulted in her wishes being substituted for his. It was not necessarily objectionable (at least not legally) when she told him what she wished he would do, what her mother had wanted, or what was fair. But at some point she may well have turned ordinary familial influence into “undue” influence.

We hope that helps explain this complicated and nuanced area of the law. But we want to leave you with a completely unrelated, but important, note: Kieran Hartley York joined the Fleming & Curti family (literally) on Sunday, March 3. We are delighted to have met the little guy, and look forward to great things from him in the future.

In Rare Challenge, Court Finds Revocation of Will Effective

FEBRUARY 22, 2010  VOLUME 17, NUMBER 6

The popular conception of the probate process and the making of wills is colored by misinformation from a number of sources. Movies, books and plays provide much of the misunderstanding, building an expectation of “the reading of the will” in a lawyer’s office (it just doesn’t happen), regular will contests (they are quite rare) and regular revocation of wills. That last is especially rare, and so a recent case focusing on how one revokes a will, and what level of mental capacity it requires, is a legal gem.

Why don’t people revoke their wills more often? They do — but the nearly universal way one revokes a will is to sign a new will, which recites that any previous wills are no longer effective. It is especially rare to destroy an existing will without signing a new one. When that does happen, the person no longer has a will at all — and the state law of “intestate succession” takes effect, just as it would if there had never been a will.

So how does one revoke a will, if they are for some reason not inclined to sign a new one? There are any number of ways to do so, but the classic method is for the person to physically tear his or her own will into at least two pieces. What Bill Potts did was more elaborate: he drew lines through every line of text, applied Liquid Paper to the names of the beneficiaries he had listed in the will, wrote “void” over each paragraph, and then wrote “bastard” and “get nothing” next to some of the names. Just to make sure he had driven his point home, he later took the marked-up document to his insurance agent’s office and fed it to their shredder.

As an aside, Mr. Potts’ approach would have worked just fine under Arizona law, too. The statute in Arizona requires only that the testator (the person who signed the will in the first place) perform “a revocatory act on the will.” That includes burning, tearing, canceling, obliterating or destroying the will or any part of it. It does not include telling someone else to do any of those things, unless the testator is conscious and physically present at the time.

After Mr. Potts died the individuals named in the will sought to admit a copy to the Arkansas probate courts. They argued that Mr. Potts had suffered from “insane delusions” at the time he tried to revoke the will, and that his revocation was ineffective.

The trial in probate court primarily focused on Mr. Potts’ belief that his late wife might have had an affair with one of the beneficiaries named in his will, that another might have stolen a gold bracelet belonging to his wife. A psychiatrist testified that those beliefs were the product of a “delusional disorder.” The trial judge found that Mr. Potts’ belief about his wife’s infidelity was probably wrong, and that his poor hearing and irascible nature probably contributed to a misunderstanding about the bracelet, Still, ruled the judge, the will beneficiaries had not met their burden of showing that Mr. Potts lacked testamentary capacity when he revoked his will, and therefore the revocation was effective. Bill Potts died intestate.

The Arkansas Court of Appeals agreed, and upheld the probate court’s ruling. The appellate court spent some time considering whether there was sufficient evidence that Mr. Potts had the level of capacity needed to write a will — the same standard that would be applicable to determining whether he had the capacity to revoke a will. Although Mr. Potts frequently claimed, for example, that he had no relatives, the appellate court agreed that he probably meant that he had no surviving close relatives. Meanwhile, he could identify some, perhaps most, of his remaining distant relatives, and he just didn’t know where they lived, or even whether they were still alive.

“The evidence clearly showed that Bill was an irascible, angry, suspicious, controlling, profane and difficult man for most of his adult life,” wrote the appellate judges. That, however, was not enough to find his will revocation invalid. He had the capacity to revoke his will, and presumably he would have had the capacity to sign a new will — if he had known who he wanted his estate to go to. Heirs of Goza v. Estate of Potts, February 17, 2010.

Court Distinguishes Between Undue Influence, Incapacity

DECEMBER 28 , 2009  VOLUME 16, NUMBER 66

Contrary to public perceptions, will contests are actually rare. In fact, few wills are written in such a way that anyone would benefit from a contest — most wills leave property to the same people who would inherit if there was no will. When there is a will contest, however, the two most common grounds are allegations of (1) lack of testamentary capacity, or (2) undue influence exerted by someone. A recent Texas case highlights the differences between those two allegations.

Evelyn Marie Reno died at age 81. She had been married twice, and left three children from her first marriage and one daughter from the second. The youngest child, Jan LeGrand, did not get along well with her half-siblings. Relationships between Ms. Reno and the three children from her first marriage were also strained — at least partially because two of them had initiated a guardianship proceeding (which was later dismissed) against their mother.

Ms. Reno spent the last year of her life in a nursing home. Ms. LeGrand visited her regularly, paid all her bills, and kept her location a secret from her half-siblings. At some point in the year before she died, Ms. Reno asked her daughter to help her prepare a new will disinheriting her other three children and leaving her entire estate to Ms. LeGrand.

The will was prepared (by Ms. LeGrand), and signed in Ms. Reno’s nursing home room. The witnesses were a hospice worker and chaplain, and the notary public was a nursing home employee. Ms. LeGrand was asked to leave the room while the three non-family members discussed the will and watched her sign it.

After Ms. Reno’s death the will was filed with the probate court by Ms. LeGrand. The three half-siblings proposed an earlier will, which left most of the estate to the four children equally.

The Probate Court ruled that Ms. Reno lacked testamentary capacity at the time the last will was signed, and that she was subjected to undue influence by her daughter. The earlier will (and a codicil) were instead admitted to probate.

The Texas Court of Appeals analyzed the findings of the Probate Court, and modified the basis for its findings — while not changing the result. The evidence, according to the appellate court, showed that Ms. Reno DID have testamentary capacity. Though she was often confused, the two witnesses and the notary agreed that the will was signed on a good day. Evidence of confusion and occasional disorientation on days before and after the will signing was not enough to overcome the testimony that she knew what she was signing, who her children were and what she intended to do at the time she signed the will.

The appeals judges agreed with the Probate Court, however, on the subject of undue influence. A key part of the evidence considered by the Court of Appeals: the fact that the will was actually prepared by Ms. LeGrand. As the Court wrote: “the fact that LeGrand personally prepared teh will without the intervention of an atotrney or other third party is significant.”

Also important to the court’s analysis: Ms. LeGrand had sole access to Ms. Reno for more than a year (during which time their mother’s whereabouts were not shared with the other three children). During that time, noted the Court of Appeals, Ms. Reno was completely dependent on Ms. LeGrand for bill-paying, care management and personal contact.

A more subtle distinction is drawn by the appellate judges with regard to Ms. Reno’s declining mental status. Though her condition at the moment of signing the will did not support the allegations of lack of testamentary capacity, her growing confusion and periodic mental weakness made her susceptible to undue influence.

Finally, the Court of Appeals notes that the will prepared by Ms. LeGrand for her mother was a complete shift from her prior wills. In each of those she made specific bequests to her four children and thirteen grandchildren, plus hospitals, her church and her pastor. The last will, however, left everything to one daughter — and this significant change in her dispositive plan was yet another indication of undue influence.

Though family members often confuse the concepts of testamentary capacity and undue influence, the legal analysis of the two different approaches to will contests is well-developed. It is also important to note that not every attempt to talk someone into making a new will is automatically subject to challenge. As the Reno court opined, in somewhat dry legalistic language: “One may request, importune, or entreat another to create a favorable dispositive instrument, but unless th eimportunities or entreaties are shown to be so excessive as to subver the will of the maker, they will not taint the validity of the instrument.”

The difference between “lack of testamentary capacity” and “undue influence” is legalistic, to be sure, but it is more than just academic. Interestingly, the Texas Court of Appeals noted that there is a difference in the burden of proof borne by the parties in the two different kinds of cases. In a case alleging lack of testamentary capacity the proponent of the will has the burden of proving that the testator understood what she was doing. In an allegation of undue influence, the challenger carries the burden of proof.

That means that each side in Ms. Reno’s case met their burden of proof. That is, Ms. LeGrand showed that her mother understood what she was doing, but the other three children demonstrated that Ms. LeGrand unduly influenced their mother. Estate of Reno, December 18, 2009.

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