Pearl River County Probate Case Involving Undue Influence

Family Status Does Not Always Result in Confidential Relationship

Over the past few months, I have highlighted the role that confidential relationships play in undue influence cases (see here, here, here, and here, to name a few).  But does a family relationship automatically give rise to a confidential relationship?  In a recent Pearl River County probate case involving a father’s claim of undue influence by his daughter, the Mississippi Court of Appeals held that a family relationship does not necessarily equal a confidential relationship.

In 1992, Bordman Humphrey signed over two pieces of property to his daughter Jeanette Smith. His other daughter, Nadine Stevens, with whom he was living, drew up the deeds. A year later Humphrey initiated suit against Jeannette, claiming that his daughter procured the deeds to the property by fraud and undue influence. He argued that he had only intended for Jeanette to have title to the property temporarily in order to protect it from his daughter Wilda, who he believed was trying to take the property. He claimed that Jeannette was supposed to re-convey the property to him once he was mentally able to tend to his own business affairs.

The suit was drawn out for four years before Humphrey voluntarily dismissed the action against Jeannette.  But in 1999, two years after dismissing the initial suit, Humphrey was under a conservatorship and Nadine (who had originally drawn up the deeds) was the appointed conservator.  While under the conservatorship, Humphrey refiled his suit against his daughter to get his property back. By this time, Jeannette had sold the property.  Humphrey sought to recover the property both from Jeannette and the purchasers.

Because Humphrey had dismissed the suit already, the purchasers claimed that Humphrey was barred from re-instituting the lawsuit.  He claimed that the dismissal was void because he was not of sound mind when he filed it. The case was remanded to the lower court. While the case was on remand, Humphrey and Jeannette died.  Nadine continued the suit as executor of Humphrey’s estate.

The lower court held that Humphrey was not of sound mind at the time of the voluntary dismissal and set it aside.  This brought the issue of undue influence back to the forefront.  Nadine asserted that Jeannette abused their confidential relationship by exerting influence over him to coerce him into signing over the property to her. The Pearl River County probate (chancery) court disagreed, dismissing Nadine’s claims of undue influence and lack of testamentary capacity.  Nadine appealed on behalf of Humphrey’s estate.

On appeal, the issue was whether the Pearl River County chancellor erred in finding that there was no undue influence involved.  Nadine argued that the transfer was presumptively invalid because there was a confidential relationship between Humphrey and Jeannette.  But the Court of Appeals disagreed, upholding the Pearl River County chancellor’s determination that the transfer was not the product of undue influence.

The Court of Appeals  applied the well-established rule that a confidential or fiduciary relationship exists whenever there is a relationship between two people in which one person is in a position to exercise dominant influence upon the other because of the latter’s dependency on the former arising either from weakness of mind or body, or through trust.[1] But the family relationship, standing alone, does not create a confidential relationship.  While Humphrey was at times weak and dependent, he was dependent on Nadine, not Jeannette.  Although both daughters were close to their father, Nadine had the closer relationship.  And it was Nadine that had actually prepared the deeds.

Although Nadine reasserted Humphrey’s claim that the deeds were intended for safekeeping, there was nothing on the face of the deeds to support that contention.  The deeds simply contained nothing to indicate that the conveyance was anything but an outright transfer.

The Appellate court affirmed the ruling of the lower court, holding that there was no fraud or undue influence in the procurement of the deeds.

Stevens v. Smith, 2007-CA-01664-COA (March 3, 2009)

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[1] Hendrix v. James, 421 So. 2d 1031, 1041 (Miss. 1982) (overruled on other grounds).