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Capacity Case Illustrates Witness Weight

This unpublished opinion provides an opportunity to discuss the types of witnesses that are often involved in lack of capacity and undue influence cases, and how they are weighed at the trial level.

The case of is called In Re Estate of Aurelia Rokosky (click on the name to read the case).

Aurelia lived alone on Grosse Ile. She apparently had no spouse or children.  But she had a friend who lived nearby until 1994 when this friend moved to Portland, Oregon.  In 1976 Aurelia prepared a will leaving everything to this Portland friend.

In 2008, when Aurelia was 86, she developed a new friendship with a person in Michigan. This Michigan friend helped Aurelia with her shopping and housework.  In 2010, this Michigan friend began helping Aurelia with her bill payment and finances.

Aurelia also had a neighbor (“Neighbor Bill”) with whom she had a good relationship until mid-2010. Before their friendship broke off, Neighbor Bill observed that Aurelia suffered from significant confusion, that she was unable, for instance, to operate her television, and that she repeated herself frequently. Their relationship ended, Neighbor Bill claimed, because Aurelia became paranoid.  At one point in late 2010, Neighbor Bill called the local police department because he was afraid that Aurelia was not safe living alone, but the police found her home and living situation to be in reasonable order.

On January 24, 2011, Aurelia saw a lawyer and had a will prepared leaving everything to the Michigan friend. The lawyer testified that she was clear and coherent at their meeting, and that she had testamentary capacity.

That same day, when Aurelia arrived home, she called Neighbor Bill several times, each time in an agitated state, and each time explaining that she had arranged for her estate to pass to the Michigan neighbor at her death.

A few days later, Neighbor Bill and others who knew Aurelia became concerned that they had not heard from or seen Aurelia. The police were called.  Aurelia was found in her home in her bathtub fully clothed.  It is unclear how long she had been in the tub, and she was taken to a hospital where a doctor evaluated her cognition and deemed her to be “profoundly confused.”

Aurelia was discharged from the hospital to a long term care facility where she lived the remainder of her life and died in August, 2013.

Also, it is important to note that in September 2011, Aurelia met with a second lawyer and executed a ladybird deed leaving her home to Michigan friend at her death. That deed was deemed invalid, and that decision was not appealed.  But the second lawyer also testified that as of September 2011, when Aurelia met with him, she had testamentary capacity.

And finally, the Portland friend, in contesting the validity of the will, employed an expert witness, a geriatric psychiatrist, who reviewed the Aurelia’s medical records and opined that Aurelia lacked testamentary capacity on January 24, 2011 (the date of the will) and for every day thereafter.

After receiving all of this testimony, the trial court admitted the 2011 as valid on summary disposition, and the Portland friend appealed.

So, to sum it up, besides the presumably self-serving testimony of the parties themselves:

  • There are two lawyers who met with Aurelia and who testified that Aurelia had testamentary capacity in January 2011 and in September 2011.
  • There is a police report that indicates that Aurelia’s home was reasonably maintained in mid-2010.
  • There is an uninterested fact witness, Neighbor Bill, who testified as to Aurelia having clear signs of cognitive impairment before the 2011 will was executed, and that Aurelia became severely agitated and confused on the very date she signed the will, leading to hospitalization a few days later.
  • There is the evidence that the Michigan friend, a fact witness who seeks to have the will upheld, cannot dispute, which is that she was helping Aurelia with her daily activities, including her finances, before the will was signed.
  • There is a medical opinion from four days after the will was signed, when Aurelia was in the hospital, that she was demented and severely confused.
  • There is an expert opinion that she lacked testamentary capacity on the date the will was signed.

Indeed it is difficult to understand how a trial judge would think that, with all this evidence, this case could be decided on summary disposition. And you will not be surprised to learn that the Court of Appeals reversed that order and remanded the case for trial.  But this case illustrates some important points about how these cases can be viewed at the trial court level, and what witnesses carry the most weight, including:

(1) Trial judges often place great weight on the testimony of the lawyers they know. Capacity is, after all, a legal question and lawyers who regularly prepare estate plans are considered experts in evaluating whether their clients meet the standards of testamentary capacity.

(2) Capacity is presumed. The burden is on the contestant to overcome the presumption of capacity.  In any case where there is a lawyer who prepared the document, this presumption and the testimony of an experienced estate planning attorney, carries great weight.

(3) Testamentary capacity is a low standard.

(4) The “lucid moment” concept is far from dead. Even though Aurelia was deemed incompetent only a few days after the execution of the will, and even though she spent those few intervening days in a confused and agitated state, and even though there is ample evidence of age-related cognitive decline even before the will was signed, the trial judge presumably had no problem concluding that she was clear and coherent at the moment she signed the will, as her attorney testified.

These are the types of witnesses that often exist in lack of capacity/undue influence cases. What we can take away from this example, I think, is that challenging documents prepared by an experienced lawyer is tough sledding, but can be accomplished.  As in this case, expert opinions have become standard practice, and are often critical to surviving summary disposition.  Solid testimony from an uninterested fact witness can also be very valuable.  And, as I have suggested before, surviving summary disposition is often the first objective.  When a case is heading to a jury, the parties each face significant risk and the possibility of settlement increases accordingly.

Published Opinion: No Immunity for Retained Expert

This question could have come up in some other type of case, but it came up in a probate case and that case is published, so I’ll write about it – briefly.

The question is: Can I sue my own expert witness for malpractice?

The answer is: Yes.

That answer did not surprise me.

To read Estate of Voutsaras v Bender et al, click on the name.

Great Facts and Experts Can’t Survive Summary

An unpublished opinion today that looks at the question of when expert opinions are sufficient to create a question of fact, versus when they remain mere speculation; in the context of a motion for summary disposition.

In In Re Jeannine A. Palazzo Irrevocable Trust (click on the name to read the case), the attorney/trustee failed to inform beneficiaries of his activities in relation to an irrevocable life insurance trust (an “ILIT”) established for their benefit by an aunt. During the years leading up to the aunt/settlor’s death, the liquidity in the ILIT was depleted to the point of near insolvency.  This prompted the attorney/trustee to liquidate the policy for $36,000 and by doing so give up the $500,000 death benefit. As it turns out, he did this just days before the death of the aunt/settlor.

The successor trustee sued attorney/trustee for breach, and presented testimony of an expert estate planning lawyer and an accountant, both of whom opined that had the attorney/trustee performed his fiduciary duties with respect to informing the beneficiaries, the beneficiaries could have taken steps to protect their interests and potentially preserved the policy so as to receive some or all of the death benefit.

An Interesting Question

The trustee/attorney moved for summary disposition in the trial court and prevailed on the argument that merely speculating that the beneficiaries could have or might have taken steps to alter the outcome is insufficient, if you don’t explain what they would have done and when.

The Court of Appeals affirmed the trial court, adopting the proposition that merely speculating that something could have been done is insufficient to create a question of fact sufficient to survive summary disposition.

An Uncomfortable Result

A central premise to trust law is that beneficiaries are empowered to protect their interests by being provided information. A trustee protects itself by providing that information.  When a trustee fails to provide the required information, the law holds the trustee liable for the resulting damages and does not allow the trustee the protection of time barriers to claims that would otherwise arise.

For a court to conclude that although a trustee breached its duties by failing to provide the required information, but that the trustee is nonetheless absolved of liability on summary disposition even where experts have opined that something could have been done had the information been provided, just feels wrong.

Conclusion

Bottom line is the beneficiaries lost on summary because they did not specifically state what could have been done to alter the outcome had the missing information been provided. While that seems like a fine line to draw; that is the line that worked in this case, and a line litigators will want to remember when they need to make the same distinction in future matters.

They say it is an ill-wind that blows no one good, and no doubt there is one trustee/attorney who will be full of Thanksgiving today.