Ex'r v. Kaye (In re Kaye), 2017-CA-00511-COA

• Decision Date: 02 October 2018
• Docket Number: NO. 2017-CA-00511-COA,2017-CA-00511-COA
• Citation: 270 So.3d 1023
• Parties: In the Matter of the Estate of John M. KAYE, Deceased: John Morgan Kaye Jr., Executor, Appellant v. Patricia M. KAYE, Appellee
• Court: Mississippi Court of Appeals

270 So.3d 1023

In the Matter of the Estate of John M. KAYE, Deceased: John Morgan Kaye Jr., Executor, Appellant

v.Patricia M. KAYE, Appellee

NO. 2017-CA-00511-COA

Court of Appeals of Mississippi.

October 2, 2018

ATTORNEY FOR APPELLANT: DEWITT T. HICKS JR.

ATTORNEY FOR APPELLEE: HAL H. H. MCCLANAHAN III, Columbus

BEFORE LEE, C.J., WILSON AND WESTBROOKS, JJ.

WESTBROOKS, J., FOR THE COURT:

¶ 1. John Morgan Kaye Jr. (John), as executor of the Estate of John M. Kaye (Jack), deceased, filed a petition to recover assets and for other relief against Patricia M. Kaye (Pat), Jack's wife, in the Lowndes County Chancery Court. Although neither the will nor Pat's power of attorney was contested, John claimed that Pat's inheritance should be rendered void because a confidential relationship existed between Jack and Pat. The chancellor found that no confidential relationship or fiduciary duty existed between Jack and Pat nor was there any undue influence exerted by Pat over Jack. John appeals. Finding no error, we affirm.

FACTS

¶ 2. Jack and Pat married in 1987 and remained married until Jack's death on January 20, 2012. Both Jack and Pat had children from previous marriages. Jack had two sons, John and William Samuel Kaye, as well as a daughter, Louise Harlan Kaye.

¶ 3. In early 2006, Jack fell backward down fourteen steps at his home. After his fall, in August 2006, Jack created a will. Instead of using Hunter Gholson, his long-term attorney, Jack switched his services to Hal H. H. McClanahan, Pat's attorney, because she believed Gholson's fees were too high. In his uncontested will, Jack left John, John's three sons, and Pat each one-fifth of his estate. Jack also devised Pat their marital home with all furnishings. In his will, Jack stated that he did not split the estate with William or Louise because William is independently wealthy and Louise, who is mentally handicapped, has a trust. On the same day Jack created the will, he executed a Power of Attorney appointing Pat as his attorney in fact.

¶ 4. In February 2007, Jack fell again and broke his hip. After this fall, Jack was placed in Trinity Place for rehabilitation. After an incident with the staff, Jack returned home. During this time, Jack was regularly treated by his physician, Dr. Frank Dailey. Dr. Dailey treated Jack from 2006 until his retirement in 2008.

¶ 5. In 2008, Jack created a joint account with Pat that included rights of survivorship. In 2009, Jack authorized UBS to transfer all assets from his solo account to the joint account. This authorization gave Pat the right to make decisions and jointly access the funds. Because Jack did not execute the document at the UBS office, he had the form notarized by Marilyn Reaves at a Regions Bank and sent back to UBS. Reaves testified that Jack alone came into the bank and signed the forms. Furthermore, she stated that she did not recall anyone accompanying Jack to the bank.

¶ 6. After Jack's death in 2012, his will was admitted to probate, and it was discovered that minimal funds remained in the UBS account. John brought an action against Pat claiming wrongful conversion. While John decided not to contest the will or the Power of Attorney, he requested the chancery court deny her assignment from the will: her fifth of the estate and the marital home. He also requested that the court require Pat to return the joint account to the amount of $1,210,371.91.

¶ 7. The chancellor court found that Pat committed no wrongdoing. John timely appeals.

STANDARD OF REVIEW

¶ 8. "The standard of review of chancery matters is limited."

Estate of Langston v. Langston , 141 So.3d 28, 31 (¶ 7) (Miss. Ct. App. 2014).¹ "We will not disturb a chancellor's factual findings that are supported by substantial evidence." Id. "The chancellor's decision will be affirmed unless the chancellor abused [his] discretion, was manifestly wrong, or [his] findings were clearly erroneous, or [he] applied an erroneous legal standard." Id. "We review questions of law de novo." Id.

DISCUSSION

¶ 9. John raises four issues on appeal. First, he asserts that the chancellor committed manifest error in failing to find that a close relationship existed. Second, he asserts that the chancellor failed to apply established caselaw that when a close relationship exists in an inter vivos transfer the presumption of undue influence is established. Third, he asserts that the chancellor failed to shift the burden to the inter vivos grantee/beneficiary to prove by clear and convincing evidence the transfer was valid. Last, he asserts that the chancellor failed to apply the correct legal standard regarding the presumption of undue influence.

¶ 10. In his principal brief, John asserts there is a confidential relationship between Pat and Jack proven through the seven Dabney factors.² The Mississippi Supreme Court describes a confidential relationship as:

[A] relation[ship] between two people in which one person is in a position to exercise a dominant influence upon the other because of the latter's dependency upon the former, arising either from weakness of mind or body, or through trust, the law does not hesitate to characterize such relationship as fiduciary in character. The dependency factor was emphasized again when we stated, "In determining whether or not a fiduciary or confidential relationship existed between two persons, we have looked to see if one person depends upon another."

In re Caspelich , 22 So.3d 1199, 1205 (¶ 20) (Miss. Ct. App. 2009) (quoting Madden v. Rhodes , 626 So.2d 608, 617 (Miss. 1993) ).

Morever, this Court has held that "a confidential relationship between spouses does not create a presumption that one spouse used undue influence over the other to obtain an inter vivos gift." Estate of Langston v. Langston , 141 So.3d 28, 31 (¶ 9) (Miss. Ct. App. 2014). Although "[i]t is undoubtedly true that a husband or a wife may exercise undue influence upon the other spouse ... it is the contestant's burden to show that the surviving spouse used undue influence." Id. (internal quotation mark omitted). So, regardless of whether there was a confidential relationship because of Jack and Pat's status as husband and wife, it is John's burden to prove that Pat used undue influence in Jack's creation of the joint account.

¶ 11. This Court has held that "[w]ith regard to both testamentary and inter vivos gifts, undue influence will be found where a spouse has used undue methods for the purpose of overcoming the free and unrestrained will of the other spouse, so as to control his or her acts and to prevent him or her from being a free agent." Id. (internal quotation mark omitted). Here, it seems that Jack was "a free agent." Id. The chancellor considered the testimonies of many witnesses...