Gatewood v. Gatewood
| Decision Date | 20 January 2016 |
| Docket Number | No. 07A01–1503–EM–108.,07A01–1503–EM–108. |
| Citation | 45 N.E.3d 1279 (Table) |
| Parties | Charles E. GATEWOOD, II, and Rita L. Gatewood, Appellants–Defendants, v. John A. GATEWOOD, as Personal Representative of the Estate of Margaret H. Gatewood Appellee–Plaintiff. |
| Court | Indiana Appellate Court |
Thomas M. Barr, Tomas M. Barr & Associates, Nashville, IN, Attorney for Appellant.
Stephen J. Harants, Miller & Harants, New Haven, IN, Attorney for Appellee.
[1] Charles E. Gatewood, II a/k/a Chip (“Chip”) and Rita L. Gatewood (“Rita”) appeal the judgment of the Brown Circuit Court in favor of John A. Gatewood, as personal representative of the Estate of Margaret H. Gatewood (“the Estate”)in the Estate's action against Chip and Rita. On appeal, Chip and Rita (collectively “the Defendants”) present two issues for our review, which we consolidate and restate as whether the trial court properly applied a presumption of undue influence in Chip's and Rita's transactions with the decedent.
[2] We affirm.
[3] The decedent in this case, Margaret Gatewood, had three children with her husband, Charles Gatewood, Sr., namely: Suzanne Zupancic (“Suzanne”), Chip, and John Gatewood (“John”). Margaret also had a granddaughter, Laurie Linback (“Laurie”) who was Suzanne's daughter. Charles, Sr. passed away in 1999.
[4] Chip married Rita in 1984. From that date until 2009, Chip and Rita lived in a mobile home on property adjacent to Margaret's home. Both Chip and Rita helped Margaret with mowing and other upkeep on her property, especially after the death of Charles, Sr.
[5] Margaret was an independent and strong-willed woman most of her life. When her husband was alive, he and Margaret would make an annual trip to Disney World in Llorida, staying at a campground at the park from January to March. After her husband's death, Margaret continued to spend the winter months in Llorida. By 2007, Margaret showed signs of slowing down. Although she was able to live by herself and even travel to Florida, Margaret began to suffer from memory loss and had issues maintaining her balance.
[6] When Margaret was in Florida in the winter of 2007, Laurie reviewed Margaret's checkbook and found checks that had been made but not recorded, which was very unusual. She also noticed that some of these unrecorded checks had been made out to Chip and Rita when Margaret was in Florida. Shortly thereafter, Margaret removed Rita as a signatory from her bank accounts and her certificates of deposit and instead added Laurie as a signatory. In April of 2007, Laurie then obtained power of attorney from Margaret.
[7] Margaret again made her annual trip to Florida in 2008 with Laurie accompanying her, but Margaret's condition gradually worsened. In the winter of 2009, Margaret again made her annual trip to Florida, this time without Laurie. Laurie received a call from Margaret's neighbor in Florida who was concerned with Margaret's welfare. Laurie attempted to contact her grandmother in Florida but could not reach her. Concerned for Margaret's wellbeing, Laurie and her mother Suzanne traveled to Florida to check on Margaret. There, they found Margaret living in squalid conditions: the home was filthy, feces were on the carpet, and Margaret was apparently not taking her medications, as the medicines were unopened. Margaret also appeared not to have bathed since she had arrived a month ago, and she had lost a substantial amount of weight. Laurie and Suzanne cleaned Margaret up and flew back to Indiana with her a few days later.
[8] Once in Indiana, Laurie took Margaret to her family physician, who referred her to neurologist Doctor Abdulkarin Sharba (“Dr.Sharba”). When Dr. Sharba examined Margaret on March 11, 2009, she was unable to read or write a sentence, and she was disoriented as to both her location and the current year. Dr. Sharba diagnosed Margaret with at least moderate dementia.
[9] With the agreement of all of the family, Margaret was admitted to the Methodist Home in Franklin, Indiana, for rehabilitation and physical therapy. Chip and Rita claim that they did not intend for Margaret to permanently remain in the nursing home and considered the move only temporary. Eventually, however, it became more clear that Margaret's stay in the home was going to be long-term, if not permanent. Laurie began to seek guardianship over her grandmother in March 2009.
[10] Margaret, who was still strong-willed, did not wish to remain in the nursing home. On April 27, 2009, Margaret was taken to an attorney by Chip and Rita where she executed a new power of attorney instrument removing Laurie as her attorney-in-fact and naming Chip as her attorney-in-fact. Chip paid the fees for preparing this change in the power of attorney. When Laurie learned of the change in the power of attorney, she abandoned her efforts to establish a guardianship. Laurie turned over to Chip all of Margaret's financial information and papers. Among these was a will that was executed in Laurie's presence. This will was never submitted to probate.
[11] At the end of April and the beginning of May 2009, Chip moved his mother back to her home. Chip and Rita moved out of their mobile home and moved in with Margaret. Rita eventually quit her job at a grocery store to help care for Margaret, as did Chip after he suffered a heart attack. When Chip and Rita were living with Margaret, Margaret's money was used to pay all of the bills, and Chip and Rita paid no rent. They did, however, rent out their mobile home for $400 or $500 per month. Once Chip and Rita moved in with Margaret, they limited her contact with the other members of the family. Laurie was told that she was not allowed to go to the home, and John was only allowed to visit with his mother if either Chip or Rita were with him. On occasion, John's visits were even monitored using a baby monitor.
[12] As his mother's attorney-in-fact, Chip took care of Margaret's finances. He helped her close certain bank accounts and open other accounts. However, his efforts to keep his money and his mother's money separate were not successful. Indeed, Chip admitted that his money and Margaret's money were “all the same.” See Appellant's App. p. 19. Typically, Chip paid for his mother's expenses out of her accounts, but he sometimes used his and Rita's accounts and reimbursed himself from Margaret's accounts. Other than some notations in the memo lines of the checks such as “food,” Chip did not maintain records of how he used his mother's money.
[13] Additionally, Rita used two credit cards that were in Margaret's name. She used these cards to pay pharmacy and medical bills and other household expenses in addition to almost $5,000 in balance transfers from other credit cards. Although Rita used these cards mostly for Margaret's medicine and expenses, she also used them to pay for items for herself, with Margaret's permission. Chip, however, was unaware of these cards, and Rita gave the credit card bills directly to Margaret who asked her not to discuss the bills with Chip.
[14] Between August 14, 2010, and October of the next year, Chip, acting as Margaret's attorney-in-fact, wrote checks on Margaret's accounts to himself, his auto-repair company, and Cintas, who provided uniforms for Chip's auto-repair company. These checks totaled $5,610. Of this amount, $1,150 noted in the check memo line, or were testified to by Chip, as being for food and gas. Another $1,000 was for labor Chip performed installing a water systems and pump in Margaret's house. Margaret was aware that Chip and Rita would purchase groceries and medicine for her, sometimes with their own funds, and Margaret would reimburse them for such expenses.
[15] Between May 2009 and January 2011, Chip, acting as attorney-in-fact, wrote an additional $2,766 of checks and traveler's checks from Margaret's account to Rita. Although some contained memo notes that they were for items purchased for Margaret, others contained no notation. Furthermore, during 2011, checks totaling $4,989 were written, purportedly by Margaret, to Rita without any notation or other record of their purpose. The checks to Rita increased in frequency and amount as Margaret's condition worsened. Although all of the checks bear the name of Margaret as signor, the signatures were not the same on all of the checks. As noted by the trial court, however, no handwriting analysis was submitted into evidence. However, Rita did admit to writing her own name on the payee line on all of Margaret's checks written to her.
[16] On May 1, 2009, Margaret visited her family physician, Dr. Michael Chitwood (“Dr.Chitwood”). During this visit, Margaret was confused and not oriented as to time, i.e., Margaret thought the year was 1996. Dr. Chitwood concluded that Margaret had dementia but could still live at home with the assistance of Chip and Rita.
[17] On July 2, 2010, Margaret signed a quitclaim deed that conveyed her home and real property to herself, Chip, and Rita. The attorney who prepared the deed never met Margaret and did not have any opportunity to speak with her privately about the deed. One week after executing the deed, Margaret again visited Dr. Chitwood. Margaret did not want to eat or drink and was not motivated. She was withdrawn, depressed and had “psychomotor slowing,” i.e., slowing of thought processes. These were not usual symptoms for Margaret. During testing, she could not read something and repeat it five minutes later. She also did not know what day it was or who was president. Dr. Chitwood diagnosed Margaret with mild to moderate dementia.
[18] On September 2, 2011, when Margaret was in hospice care near death, Chip, acting as Margaret's attorney-in-fact, added his name to Margaret's bank accounts as a joint owner with right of survivorship. Margaret was not present when Chip did this.
[19] Margaret died on October 18, 2011. Ten days later, Chip filed an application for consent to transfer the balance of Margaret's accounts to his...
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