 |
How To Win An Undue Influence Case
R. Trevor Todd
In my experience in estate litigation, probably the most difficult
issue to win at trial is that of undue influence. A review of case
law makes clear the majority of such allegations are dismissed at
trial due to insufficient proof. Frequently the court simply finds
the testator had sufficient mental capacity and therefore allows the
will to be propounded.
The loss of an undue influence case at trial can have devastating
effects on both the client and the lawyer. This is especially true
for the lawyer handling such a case on a contingency fee basis. An
undue influence trial usually requires many days of examinations for
discovery. Such a trial often takes a minimum of two weeks.
Disbursements can be substantial including fees for medical expert
witnesses and private investigators..
Such influence is most often exerted in private aware from other
friends, family members of potential beneficiaries. There are rarely
eyewitnesses who observe blatant undue influence being exerted. It
sometimes seems therefore, the only way to prove such a case is with
a written confession from the person who exerted the influence.
It is a real challenge for counsel to successfully convince the
court to set aside the will or inter vivos gift, on the basis of
undue influence.
Outline
In this paper I will examine briefly the case law surrounding undue
influence and then set out twenty practice tips that will hopefully
assist a plaintiff’s counsel in winning his or her undue influence
trial.
WHAT IS UNDUE INFLUENCE?
Undue influence is an equitable doctrine. It is a category of
constructive fraud. A very fine line separates legitimate influence
from undue influence. These cases are understandably very much fact
driven. Success in such cases usually requires a meticulous
examination of the facts, particularly those that appear suspicious.
The following oft cited passage sets out the test for undue
influence at law:
A-It is settled law that undue influence sufficient to invalidate a
will extends a considerable distance beyond an exercise of
significant influence - or persuasion - on a testator. It is also
clear that the possibility of its existence is not excluded by a
finding of knowledge and approval.
To be undue influence in the eye of the law there must be - to sum
it up in a word - coercion. It must not be a case in which a person
has been induced by [strong relationships] to come to a conclusion
that he or she will make a will in a particular person's favour,
because if the testator has only been persuaded or induced by
considerations which you may condemn, really and truly to intend to
give his property to another, though you may disapprove of the act,
yet it is strictly legitimate in the sense of its being legal. It is
only when the will of the person who becomes a testator is coerced
into doing that which he or she does not desire to do, that it is
undue influence.” (Wingrove v. Wingrove (1885), 11 P.D. 81 (Eng.
Prob. Ct.), at page 82.)
This passage is cited with approval in Williams and Mortimer,
Executors, Administrators and Probate, (17th edition, 1993), at page
184. The authors continue as follows;
A-Thus undue influence is not bad influence but coercion. Persuasion
and advice do not amount to undue influence so long as the free
volition of the testator to accept or reject them is not invaded.
Appeals to the affections or ties of kindred, to the sentiment of
gratitude for past services, or pity for future destitution or the
like may fairly be pressed on the testator. The testator may be led
but not driven and his will must be the offspring of his own
volition, not the record of someone else's. There is no undue
influence unless the testator if he could speak his wishes would say
Athis is not my wish but I must do it.@
Two Kinds of Undue Influence : Actual and Presumed
1) Actual :
In cases of actual undue influence, the recipient must be shown to
have coerced the transferor to make will or inter vivos gift. The
conduct must be such that the court finds that the transfer or
disposition was not the true will or free intention of the victim.
Proof may be shown indirectly by circumstantial evidence, and
sometimes by direct evidence such as threats, lies, and promises
that the recipient had no intention to keep.
2) Presumed: Here a relationship of trust and confidence between the
transferor and transferee raises a rebuttable presumption that the
transfer was made by undue influence. Once the relationship of trust
and confidence is shown, the onus of proof shifts to the transferee
to prove that the transferor made the transferor after full, free,
and informed thought. The policy of preserving public confidence in
relationships of trust and confidence allows otherwise valid
transfers to be voided. Generally speaking, the courts will be more
inclined to interfere to set aside a substantial gift or transfer,
as opposed to gifts of a minor nature.
Any presumption of undue influence is rebuttable by showing that the
transfer was made after full, free and informed thought. This is
often done by showing that the transfer or obtained proper
independent advice.
N.B. This doctrine of presumed undue influence does not apply to
testamentary dispositions
Differing Burdens Of Proof-- Wills versus Inter vivos Gifts
or Transfers
A key point is the distinction made between gifts or transfers inter
vivos as opposed to those made by will. As noted above, in the case
of special “trust” relationships where a transfer is made during
life, a presumption of undue influence will arise. Where the gift or
transfer is made by will however, no such presumption arises and the
plaintiff has the daunting task of proving actual undue influence.
In the recent case of Araujo v. Neto, 2001 BCSC 935, Justice
Sigurdson does an exhaustive review of the case law.
Justice Sigurdson initially deals with the issue of onus of proof.
He states:
A-The onus for proving undue influence for inter vivos gifts differs
depending on the nature of the relationship between the parties. In
the absence of a fiduciary or special relationship, the onus rests
on the party alleging undue influence to prove it. However undue
influence is presumed to apply to certain relationships or in
certain circumstances and the onus shifts to the recipient of the
gift to rebut it.@
The Judge continues as follows:
“Feeney in The Canadian Law of Wills, 3rd ed., Vol. 1 (Vancouver:
Butterworths, 1987) draws a distinction between the burden of proof
when alleging undue influence in the making of a will and in the
case of an inter vivos gift made to a person in a special
relationship, at page 42:
In the case of gifts inter vivos to persons standing in a fiduciary
relationship, or some other relationship whereby the donee was in a
position to overbear the donor, such persons must show that they did
not influence the donor in making the gift. There is, so to speak, a
presumption of undue influence. There is no such presumption in the
case of wills. A person in a position to overbear a testator may
exercise persuasion to obtain a will or legacy in his favour and it
will stand in the absence of positive proof of undue influence by
those who assert it.
Undue Influence In Gifts or Transfers
Lord Justice Cotton in Allcard v. Skinner (1887), 36 Ch. D. 145
(Eng. C.A.), at 171 spoke of undue influence in connection with two
classes of voluntary gifts:
“First, where the Court has been satisfied that the gift was the result of
influence expressly used by the donee for that purpose; second,
where the relations between the donor and donee have at or shortly
before the execution of the gift been such as to raise a presumption
that the donee had influence over the donor. In such a case the
Court sets aside the voluntary gift, unless it is proved that in
fact the gift was the spontaneous act of the donor acting under
circumstances which enabled him to exercise an independent will and
which justifies the Court in holding that the gift was the result of
a free exercise of the donor's will.”
At page 181 Lord Justice Lindley said:
“The second group consists of cases in which the position of the
donor to the donee has been such that it has been the duty of the
donee to advise the donor, or even to manage his property for him.
In such cases the Court throws upon the donee the burden of proving
that he has not abused his position, and of proving that the gift
made to him has not been brought about by any undue influence on his
part. In this class of cases it has been considered necessary to
show that the donor had independent advice, and was removed from the
influence of the donee when the gift to him was made.
This remains an accurate statement of the law, although the courts
have taken a more flexible approach to the second class of case and
it is not always necessary to show that the donor had independent
advice in order to rebut the presumption of undue influence.”
In Goodman Estate v. Geffen (1991), 81 D.L.R. (4th) 211 (S.C.C.) at
221 Wilson_J. asked:
A-What are the factors that go to establishing a presumption of
undue influence? This question has been the focus of much debate in
recent years. Equity has recognized that transactions between
persons standing in certain relationships with one another will be
presumed to be relationships of influence until the contrary is
shown.”
She noted that these included the relationship between trustee and
beneficiary, doctor and patient, solicitor and client, parent and
child, guardian and ward and future husband and fiancée.
Wilson J. in Geffen then said at pages 221 and 227:
“Beginning, however, with Zamet v. Hyman, [1961] 3 All E.R. 933, it
came to be accepted that the relationships in which undue influence
will be presumed are not confined to fixed categories and that each
case must be considered on its own facts. Since then it has been
generally agreed that the existence of some Aspecial@ relationship
must be shown in order to support the presumption although what
constitutes such a Aspecial@ relationship is a matter of some doubt.
It seems to me rather that when one speaks of Ainfluence@ one is
really referring to the ability of one person to dominate the will
of another, whether through manipulation, coercion, or outright but
subtle abuse of power. ... To dominate the will of another simply
means to exercise a persuasive influence over him or her. The
ability to exercise such influence may arise from a relationship of
trust or confidence but it may arise from other relationships as
well.
What then must a plaintiff establish in order to trigger a
presumption of undue influence? In my view, the inquiry should begin
with an examination of the relationship between the parties. The
first question to be addressed in all cases is whether the potential
for domination inheres in the nature of the relationship itself.”
In Ogilvie v. Ogilvie Estate (1998), 49 B.C.L.R. (3d) 277 (B.C.
C.A.) at 295, the Court of Appeal, in the context of discussing the
various judgments in Geffen, stated that:
A-[t]he task to be undertaken by the court is to determine whether
there existed in the relationship between donor and donee the
potential for influence.@ In that case, the trial judge had stated
the following at para. 41 of her reasons (reported at (1996), 26
B.C.L.R. (3d) 262 (B.C. S.C.):
A-In my opinion, the case before me is a classic case of the second
category of undue influence, not the first. I agree that the
Plaintiffs fall short of proving any unfair or improper conduct on
the part of the Defendants. The rule of evidence applicable to the
doctrine of undue influence doesn't require the Plaintiffs to do so.
They only have to show the Aspecial relationship of influence@
between the Grahams and Hugh Ogilvie in the sense that they managed
his affairs or gave him advice and, therefore, had a duty to ensure
he received independent advice before making substantial gifts in
their favour. Then the burden shifts to the Grahams to show that
Hugh Ogilvie had independent advice, or was free of their influence
when making the subject gifts.”
The Court of Appeal in Ogilvie, supra, concluded that the trial
judge undertook the correct scrutiny of the relationship between the
donor and the donee and the questioned transactions, and upheld her
decision that a special relationship existed and that the
presumption of undue influence had not been rebutted by the
defendants.
Undue Influence In Wills
The decision of Scott vs Cousins 37 E.T.R. (2d) 113 summarizes the
leading Canadian case on undue influence re wills, namely Vout v.
Hay (1995), 7 E.T.R. (2d) 209 (S.C.C.)
A-The principles that I believe are established by the decision of
the Supreme Court, and that are relevant here, can be stated as
follows:
1. The person propounding the will has the legal burden of proof
with respect to due execution, knowledge and approval and
testamentary capacity.
2. A person opposing probate has the legal burden of proving undue
influence.
3. The standard of proof on each of the above issues is the civil
standard of proof on a balance of probabilities.
4. In attempting to discharge the burden of proof of knowledge and
approval and testamentary capacity, the propounder of the will is
aided by a rebuttable presumption.
Upon proof that the will was duly executed with the requisite
formalities, after having been read over to or by a testator who
appeared to understand it, it will generally be presumed that the
testator knew and approved of the contents and had the necessary
testamentary capacity. (at page 227)
5. This presumption A-simply casts an evidential burden on those
attacking the will.@ (ibid.)
6. The evidential burden can be satisfied by introducing evidence of
suspicious circumstances - namely, Aevidence which, if accepted,
would tend to negative knowledge and approval or testamentary
capacity. In this event, the legal burden reverts to the propounder.@
(ibid.)
7. The existence of suspicious circumstances does not impose a
higher standard of proof on the propounder of the will than the
civil standard of proof on a balance of probabilities. However, the
extent of the proof required is proportionate to the gravity of the
suspicion.
8. A well-grounded suspicion of undue influence will not, per se,
discharge the burden of proving undue influence on those challenging
the will:
It has been authoritatively established that suspicious
circumstances, even though they may raise a suspicion concerning the
presence of fraud or undue influence, do no more than rebut the
presumption to which I have referred. This requires the propounder
of the will to prove knowledge and approval and testamentary
capacity. The burden of proof with respect and fraud and undue
influence remains with those attacking the will. (ibid.)@
Suspicious Circumstances
Suspicious circumstances or are simply circumstances that arouse the
suspicion of the court. In the leading case, Barry v. Butlin (1838)
2 Moo. P.C. 480, it was held that the court ought not to pronounce
in favor of the will unless the suspicion is removed. That role has
been extended to include all cases in which a will is prepared under
circumstances which raise a well grounded suspicion that it does not
express the mind of the testator. ( Clark v. Nash (1989) 34 E.T.R.
174 (B.C.C.A.)
Undue influence can be established on the balance of probabilities
through circumstantial evidence. In Scott v. Cousins, 37 E.T.R. (2d)
113, the Court describes circumstantial evidence that may be
considered in undue influence cases:
In determining whether undue influence has been established by
circumstantial evidence, courts have traditionally looked to such
matters as the willingness or disposition of the person alleged to
have exercised it, whether an opportunity to do so existed and the
vulnerability of the testator or testatrix. ... The testatrix does
not have to be threatened or terrorized: effective domination of her
will by that of another is sufficient. ... This, I believe, is a
consideration of no little importance in the present case as well as
in the increasing number of those involving wills made by persons of
advanced age. Other matters that have been regarded as relevant,
within limits, are the absence of moral claims of the beneficiaries
under the will or of other reasons why the deceased should have
chosen to benefit them. The fact that the will departs radically
from the dispositive pattern of previous wills has also been
regarded as having some probative force.@
Examples of suspicious circumstances may include:
1) an elderly testator;
2) a testator who is unwilling to provide the solicitor with full
information relating to the assets, liabilities, medical history, or
family condition and circumstances;
3) a testator who has suffered significant ill health, particularly
if the condition, disease, or medication could affect the mental
stability or general mental outlook of the testator;
4) a disposition of the estate which seems unusual in the context of
the circumstances as known to the testator.
5) a beneficiary who has been particularly involved in “assisting”
the testator in the preparation of the will;
6) dispositions in the will drastically different from the terms of
the former will;
7) circumstances where the testator appears dependent upon another,
for example allowing the other person to speak on his or her behalf;
8) a testator with questionable testamentary capacity;
9) a testator who has had numerous wills prepared in a short period
of time;
10) a testator who has recently contracted a hasty or unwise
marriage;
11) a testator with a language, learning , intellectual or cultural
disability;
12) a testator who has recently changed living circumstances,
particularly one who moves in with the alleged perpetrator;
13) a will that makes no gifts to those seemingly appropriate;
14) a will prepared on instructions provided by the questionable
beneficiary.
15) cases where the long lost beneficiary seems to arrive “out of
the nowhere”
16) a testator suffering from depression/loneliness.
The existence of any one or more of these factors does not
necessarily mean that the will is vulnerable to attack. However the
presence of any one or more of these factors is probably the best
avenue for plaintiff=s counsel to attack the will. Successful
counsel will be vigilant as to these and other suspicious
circumstances.
Practice Tips On How To Win An Undue Influence Case
1) Before undertaking such a case, particularly on a contingency fee
basis, counsel should consider being retained initially only to
gather facts. This will assist both client and counsel in
determining whether there is a good likelihood of success.
This may not be required if probable lack of testamentary capacity
is apparent from the outset. The obvious difficulty with most undue
influence cases is the absence of witnesses. Most often there are
only two people involved. One is now dead and the other is not
talking. Accordingly there are usually immense problems in
determining the facts upon which to allege undue influence.
I simply stress that counsel should be very selective in deciding
whether or not to accept such cases. Certainly the size of the
estate should be considered when making this decision.
2) File a probate caveat right away, but do not commence the court
action until you have sufficient proof to justify your allegations
of undue influence. The defense may quickly move for a summary
trial. The court may award costs or higher costs against your client
if you cannot prove the allegations.
3) Consider retaining an experienced private investigator to assist
in determining the facts. Undue influence cases demand a meticulous
examination of the facts. The private investigator should take
signed statements from any witnesses who have material evidence. I
consider it necessary to interview almost every person who knew the
deceased at the relevant times. Try to obtain a background report on
the defendant. It may be surprising how often there may be evidence
of prior undue influence allegations. Interview the witnesses to the
will or transfer.
4) Get as many records as possible concerning the deceased. This
would include all medical records from every doctor and medical
institution for at least 10 years prior to death, together with all
long-term care records, social work records, nursing home records,
care facilities, work or school records (if appropriate), and the
like. It would also include the lawyer=s notes, and perhaps the
lawyer=s notes of previous wills. The majority of undue influence
cases involve senior citizens and there is often an issue of
testamentary capacity. I stress however that undue influence can
occur in non senior situations such as for example, a young person
joining a cult.
5) Marshall the suspicious circumstances and present them in the
form of a compelling argument to prove the case (usually through
circumstantial evidence). Look to stress situations showing a
pattern of the defendant making the deceased more dependant ( ie
isolating and limiting access)
6) Try to determine the names and addresses of the witnesses that
the alleged perpetrator relies upon, and try to interview them. I
have found that if the defendant appears to be flaky, (which is
often the case ),then the old adage often applies Abirds of a
feather flock together@ often applies. Having this information will
assist you in your cross examination.
7) Recognize and benefit from the lack of sophistication of most
perpetrators of undue influence. Usually perpetrators are
unsophisticated in their methods. While undue influence is a form of
civil fraud, the defendants are usually not particularly
intelligent, skilled, or savvy.
8) Try to avoid a summary trial unless you have an overwhelming
case. I have succeeded at trial, particularly through
cross-examination, on cases which may well have been lost on a
summary trial. On a summary trial the judge never has the
opportunity to assess the credibility of the witnesses. As mentioned
above, often these characters can be quite “flakey” and may contrast
well with presentable and sympathetic plaintiffs.
9) In setting aside inter vivos gifts, take advantage of the
presumption of undue influence where there is a special relationship
situation. There often is a Ahousekeeping@ situation present.
10) Obtain expert opinion(s) from those such as geriatric
psychiatrists(s) who never met the deceased. Have them review all of
the records and tender an opinion on both testamentary capacity and
the relative vulnerability of deceased to any undue influence.
11) Get on the case Take these steps as soon as possible. The
family may come to see you prior to the death. Even where you cannot
assist them to diminish any inappropriate influence, start to build
your case as pro-actively as possible. This can involve everything
from letters to doctors, banks and the Public Guardian, to obtaining
an injunction or committeeship order.
12) Use demonstrative evidence such as home videos, photographs,
handwriting samples and the like to try to demonstrate a “ before
and after” situation where there is evidence of medical or
psychological decline.
13) Cross examine the handling lawyer or notary. Try and get an
order to discover him or her for discovery. Even the most careful
and senior lawyers may fall short in their duties. It can be highly
effective to use the Law Society checklist to cross examine the
lawyer. I refer you to Danchuk v. Calderwood 15 E.T.R.(2d) 193 where
the Judge comments on the solicitor=s handling of the will:
A_In keeping with what I understand to be the law applicable to the
duty of a solicitor, in the circumstances here, I accept the
submission of counsel for the defendants that she failed with
respect to that duty.
In my view, in the particular circumstances here, at the outset:
(A) she should have regarded the circumstances as suspicious having
regard to the deceased's advanced age and considerable seniority to
that of the plaintiff as well as his apparent dependency upon her,
including allowing her to speak for him;
(B) she should have undertaken an inquiry, including interviewing
the plaintiff and the deceased separately with regard to the age
difference and as to the independence of the deceased in giving
instructions;
(C) the inquiry should have confirmed whether the deceased had a
prior existing will and, if such a will existed, what were the
reasons for any variations or changes there from prompting the
disposition being put forward;
(D) the inquiry should have encompassed why and for what reasons the
deceased had given a power of attorney to his daughter in late 1992
and, more importantly, why upon revocation of that power of attorney
a new power of attorney was to be given by the deceased to the
plaintiff; and,
(E) collateral to (D), supra, the inquiry should have included some
investigation of the health of the deceased.
In this perspective, I understand the law to be that a solicitor
does not discharge her duty in the particular circumstances here by
simply taking down and giving expression to the words of the client
with the inquiry being limited to asking the testator if he
understands the words. Further, I understand it to be an error to
suppose because a person says he understands a question put to him
and gives a rational answer he is of sound mind and capable of
making a will. Again, in this perspective, there must be
consideration of all of the circumstances and, particularly, his
state of memory.
If the solicitor had made such inquiry and had been made aware of
the circumstances in a fuller sense, including the medical
assessment of the ongoing progression and state of senile dementia,
I am satisfied the said will would not have been prepared by her at
that time. A
14) Obtain medical opinions treating physicians as to both
testamentary capacity and whether the deceased may well have been
more susceptible to undue influence given his or her medical
condition.
15) Be bold and confident in the presentation of your case The
defense will always be skeptical and the court may be as well.
16) Be prepared to prove the relative inequality of the parties. The
court should be made to understand any power differential. Age,
infirmity and loneliness will likely render any person more
vulnerable to inappropriate influences and this should be clearly
demonstrated for the court.
17) Be prepared to prove the substantial unfairness of the will or
bargain.
18) Prepare a chronology of relevant medical or factual events
germane to your case.
19) Think hard and often as to how you will present your case.
20) Prepare and use a written opening at trial.
Conclusion
Undue influence case have always been difficult to prove for a
variety of reasons, and probably will remain that way for some time
yet into the future. I hope this paper’s outline of the law of undue
influence, together with the twenty practice tips will bring success
to plaintiff’s counsel in the future.
rttodd@disinherited.com
www.disinherited.com |
