Great Am. Life Ins. Co. v. Tanner
| Decision Date | 31 March 2020 |
| Docket Number | NO. 3:16-CV-70-DMB-JMV,NO. 3:18-CV-23-DMB-JMV,3:16-CV-70-DMB-JMV,3:18-CV-23-DMB-JMV |
| Parties | GREAT AMERICAN LIFE INSURANCE COMPANY PLAINTIFF v. AVA MITCHELL TANNER, ALITA MARGARET MITCHELL, and CRAIG J. CHEATHAM DEFENDANTS consolidated with AVA MITCHELL TANNER and PHYLLIS FERNANDEZ PLAINTIFFS v. ALITA CHEATHAM MITCHELL and CRAIG CHEATHAM DEFENDANTS |
| Court | U.S. District Court — Northern District of Mississippi |
Following Don Mitchell's death, his biological daughters, Ava Mitchell Tanner and Phyllis Fernandez, sued Don's stepson, Craig Cheatham, and Don's widow, Alita Cheatham Mitchell, alleging they unduly influenced Don in his modification of the beneficiaries of his assets. A bench trial was held on (1) Ava's claims that Alita and Craig exerted undue influence to cause Don to change the beneficiary from Ava to Alita on two Great American Life Insurance Company annuities, a Prudential insurance policy, a CETERA account, and a trust; (2) Phyllis' claims that Alita and Craig exerted undue influence to cause Don to change the beneficiary from Phyllis to Alita on the Prudential policy and the trust; and (3) Ava and Phyllis' claims that Craig and Alita violated Mississippi's Vulnerable Persons Act. At trial, Alita and Craig made an oral motion to dismiss the Vulnerable Persons Act claims, which the Court took under advisement. In accordance with Rule 52(a) of the Federal Rules of Civil Procedure, the Court's findings of fact and conclusions of law are set forth below.
"In an action tried on the facts without a jury or with an advisory jury, the court must find the facts specially and state its conclusions of law separately." Fed. R Civ. P. 52(a)(1). This rule "exacts neither punctilious detail nor slavish tracing of the claims issue by issue and witness by witness." Century Marine Inc. v. United States, 153 F.3d 225, 231 (5th Cir. 1998). However, a court may not make a factual finding which is unsupported by substantial evidence, based on a misinterpretation of evidence, or clearly against the preponderance of credible testimony. Meche v. Doucet, 777 F.3d 237, 241-42 (5th Cir. 2015). Credibility determinations should be based on a witness' "demeanor and inflection," and whether "[d]ocuments or objective evidence may contradict the ... story; or [whether] the story itself [is] ... internally inconsistent or implausible on its face." Anderson v. City of Bessemer City, 470 U.S. 564, 575 (1985).
Applying the standard above, the factual findings below considered (1) the trial testimony of Ava, Craig, Alita, Phyllis, Charles Cheatham, Terry Green, and Tarishan Winder; (2) the video depositions of Phyllis Harden, Scottie Lactland, Rhonda Gentry, and Stephen Jones, which were admitted into evidence without objection; and (3) the documentary exhibits admitted into evidence.
Don and Barbara Mitchell married in the 1960s and had three children—Ava, Phyllis, and Donice. Donice passed away in 1980. About four years after Donice's death, Don and Barbara divorced. At the time of the divorce, Don, Barbara, Ava, and Phyllis lived in Pine Bluff, Arkansas.
In 1987, Don married Earline White Cotton, and moved to Heth, Arkansas. While living in Heth, Don worked as a boat captain for Pine Bluff Sand and Gravel. As part of his employment benefits, Don designated Ava and Phyllis as beneficiaries of a Prudential life insurance policy valued at $186,000. P-6; Doc. #219 at 5. Earline died of cancer in 2005. Two years later, Ava moved to Heth to be closer to her father.
In 2011, Don, who was then approximately seventy-six years old, developed "respiratory issues." Don went to the doctor and was diagnosed with COPD. Tests also revealed a "spot" on one of his lungs. The same year, Don developed a spot on his forehead, which he had removed.
Also in 2011, Don began communicating by telephone with Alita Margaret Mitchell, who then lived in Horn Lake, Mississippi. Don knew Alita through his friendship with Alita's husband, who had died earlier in 2001.
In March of 2012, Ava traveled to Florida to care for her mother following a knee replacement surgery. When Ava returned to Heth in August, she found that her father's respiratory condition had deteriorated and that he was experiencing "urology issues." Ava scheduled Don appointments with a urologist and with an oncologist, Rhonda Gentry. In November 2012, Gentry diagnosed Don with stage IV lung cancer.
Around the time of his cancer diagnosis, Don met with Frank Dudeck, an attorney Don had previously used regarding issues of his sister's guardianship, for the purpose of estate planning. As a part of this process, Don executed on November 9, 2012, a last will and testament which left his estate to a revocable trust. The same day, Don executed documents creating the Don Mitchell Revocable Trust. As executed, the trust left "[a] sum equal to the greater of $100,00 or 25% of trust assets" to each of Don's great-grandchildren Emmia and Bianca.1 Ava and Phyllis werenamed trustees and were included among the beneficiaries of the trust. Additionally, Don named Ava as the beneficiary of two annuities valued at $120,153.25 and $117,333.54 which were issued by Great American Life Insurance Company ("GALIC") through Regions Bank,2 and a CETERA account with $148,504.14 in benefits.
In January of 2013, Don, who had been hospitalized "a couple of times" for pneumonia, began receiving chemotherapy in Little Rock, Arkansas. Throughout the year, Ava stayed with Don during his hospitalizations and his chemotherapy appointments. During that time, Ava assisted her father with paying bills. Due to his health problems, Don retired in April 2013.
In the fall of 2013, Don was "doing a little bit better" and started on a "maintenance-type therapy." Also in the fall of 2013, Alita traveled to Heth to visit Don. After her initial visit, Alita visited Don in Heth approximately once a month. Don also visited Alita in Horn Lake. During his visits to Horn Lake, Don spent time with Alita's son Craig Cheatham, who lived in Jonesboro, Arkansas. Don and Craig "started having dinners with each other."
On February 18, 2014, Don executed an amendment to the trust. The amendment modified the provision regarding Emmia and Bianca to state that "[t]he sum of $100,000.00 of trust assets shall remain in trust for the sole use and Benefit of Emmia ... and the sum of $100,000.00 of trust assets shall remain in trust for the sole use and benefit of Bianca." The amendment further added a provision stating "[a]ll mineral rights shall be equally distributed to" Ava and Phyllis.
In the fall of 2014, Ava, who was still caring for Don, began having discussions with her mother Barbara about Barbara's deteriorating health. In January of 2015, Ronnie, one of Earline's children from a previous marriage, and his girlfriend moved in with Don to assist with Don's care.Because Ava trusted Ronnie to care for her father, she "decided that [she] would take a couple of months and go down [to Florida] and see what was going on with [her] mom." Before her trip, Ava spoke with her father, who "expressed the desire to help [Barbara] with purchasing" certain medical necessities. Ava traveled to Florida in March 2015 to be with her mother. One month after Ava left for Florida, Don had surgery to remove a tumor in his bladder.
While Ava was in Florida, she monitored Don's checking accounts and observed that Ronnie, who oversaw purchasing items for Don, had engaged in a "lot of extra activity." According to Ava, she and Don agreed to open a joint checking account with Regions Bank in Florida to control Ronnie's spending. Also, consistent with Don's desire to help his former wife, Ava used Don's funds to purchase dentures, glasses, and hearing aids for her mother.
In early August 2015, Don called Craig and asked him to come to his home in Heth to help him answer some questions about his bank accounts, and to ask for Alita's "hand in marriage."3 Don, Alita, and Craig agreed that Don and Alita should get married and move to Horn Lake. During this visit, Don took Craig into his bedroom for the purpose of showing Craig Don's financial records.
Don showed Craig "everything" and, according to Craig, asked Craig, "Would you help me go through these and figure out where my trust account is?" Although initially reluctant to become involved, Craig said "sure," and advised that Don go see his banker. Don agreed and asked if Craig would come to the bank with him. Craig agreed. At Don's request, Craig took two boxes of documents home with him.
On or about August 4, 2015, at Gentry's office, Don executed a form which removed Ava'sability to make healthcare decisions for him and placed the power in Alita. According to Gentry, while Don suffered from chemotherapy-related fatigue, she believed Don had the capacity and understanding to make beneficiary determinations during the time period relevant here.4
The following week, on August 12, 2015, Don and Craig met at the Regions Bank branch in West Memphis, Arkansas. The two men met with a bank associate who informed Don that he had approximately $18,000 in open accounts in Arkansas, Florida, and Alabama. According to Craig, Don appeared confused as to why there were open accounts in Florida and Alabama. Don obtained statements for these accounts. Don was upset because he believed there should have been approximately $60,000 in the accounts. Don closed all the Regions Bank accounts and left with a check for $18,000. As they left the bank, Don appeared physically shaken and stated that Ava "ruined" him.
The following day, on August 13, 2015, Don met with Dudeck and Dudeck's legal assistant Stephen Jones. The meeting was also attended by Craig, who did about half of the talking at the meeting. At the meeting, Don complained about Ava allegedly misappropriating his funds and expressed a desire to grant Craig power...
To continue reading
Request your trial