Undue influence cases are almost always so fact specific as to be of little use as authority, and hence don't become DD's very often. But they often make good yarns, and here's one of those, with a little bit of a legal lesson:

Daily Development Monday, February 25, 2002

By: Patrick A. Randolph, Jr.
Elmer F. Pierson Professor of Law
UMKC School of Law
Of Counsel: Blackwell Sanders Peper Martin
Kansas City, Missouri
prandolph@cctr.umkc.edu

DEEDS; VALIDITY; UNDUE INFLUENCE: When there is a confidential relationship, such as a mother-daughter relationship, between the parties to the deed, only slight evidence is required to establish undue influence, and an inference of undue influence arises when such a relationship is coupled with suspicious circumstances.

Smith v. Ellison, 15 P.3d 67 (Or. App. 2000).

When plaintiff told her daughters that she was concerned about caring for her husband, who had Alzheimer's disease and Parkinson's disease, they suggested that she move near them so they could help her care for him. She asked defendant, her daughter, to find her a duplex to purchase. Defendant instead located a two-bedroom house, which she purchased on her mother's behalf and on her mother's instructions. When the mother and her husband arrived, they discovered that the defendant and five of her family members were already living in the house, but nonetheless moved in. After disagreements with defendant and her children, plaintiff and her husband moved out of the house and moved in with her other daughter. Then husband suffered a stroke. Plaintiff discussed with defendant her concern about who would care for her husband if plaintiff should die, and defendant offered to assume that responsibility, but requested that the house be transferred to her. Her mother executed a deed transferring one-third of the property to defendant.

Plaintiff's husband then died and shortly thereafter plaintiff was scheduled to travel to California for a memorial service. Before she left, defendant prepared a deed transferring to defendant the remaining two-thirds of the property which plaintiff signed. Plaintiff alleged that she was tricked into signing the deed and was unaware of its contents; defendant alleged that plaintiff directed her to prepare the deed.

After plaintiff's return to Oregon, an argument ensued during which plaintiff learned that she had signed a deed transferring the property to defendant. Plaintiff moved to set aside both conveyances, and the trial court declined to cancel the deeds.

The court of appeals, after referring to the matter as a "close issue," concluded that the first transfer of one-third of the property was not a product of undue influence, affirming the trial court. The court found a confidential relationship between the mother and daughter, despite the sometimes "rocky" nature of their relationship, citing in part the fact that they shared a bank account and that plaintiff relied on defendant to locate and purchase a residence for her. The court then considered whether suspicious circumstances existed which, when coupled with the confidential relationship, would give rise to an inference of undue influence, concluding that in the connection with the first transfer such suspicious circumstances did not exist since the defendant did not participate in the arrangements for or execution of the deed, the transaction was not conducted in haste or secrecy, it appeared plaintiff intended to transfer the property, the transaction did not seem unnatural or unjust and plaintiff did not appear unduly susceptible to influence at the time.

The court of appeals, however, concluded that the second transfer of the remaining two-thirds of the property was a result of undue influence and reversed the trial court's decision. This decision was premised on the fact that plaintiff was more susceptible to influence since her husband had recently died, she was leaving to attend a memorial service and she was, as she testified, a "basket case." Further, the transaction was done in a hasty manner, the lack of independent advice was troublesome since the defendant had prepared the deed and the gift was somewhat unjust when compared to gifts made to other family members and given that it left plaintiff with little property of her own. The court of appeals reversed the trial court, concluding that such suspicious circumstances, coupled with the confidential relationship, raised an inference of undue influence and that defendant had failed to rebut the inference.

Comment: Deeds infected by "undue influence" are voidable, but not void. Daughter might have transferred or borrowed against the interest transferred, and Mom would have been primed by those transfers, although presumably she'd still have claim against daughter. Good luck collecting!!

In fact, Mom still has a problem here, since she's a three-quarter cotenant with her daughter, who's living in the place with Mom's five grandchildren. How's Mom going to deal with this one?

Readers are urged to respond, comment, and argue with the daily development or the editor's comments about it.

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