Guardianship of Mowrer, In re

• Decision Date: 09 April 1999
• Docket Number: No. 98-647,98-647
• Citation: 979 P.2d 156,294 Mont. 35
• Parties: In the Matter of the Guardianship and Conservatorship of Clara MOWRER, An incapacitated person, and Clara Mowrer, Cross-Petitioner and Respondent, v. Maurice Eddie and Peggy Eddie, Cross-Respondents and Appellants.
• Court: Montana Supreme Court

Page 156

979 P.2d 156

1999 MT 73

In the Matter of the Guardianship and Conservatorship of

Clara MOWRER, An incapacitated person, and Clara Mowrer, Cross-Petitioner and Respondent, v. Maurice Eddie and Peggy Eddie, Cross-Respondents and Appellants.

No. 98-647.

Supreme Court of Montana.

Submitted on Briefs Feb. 4, 1999.

Decided April 9, 1999.

Frank B. Morrison, Jr., Morrisons, McCarthy & Baraban, Whitefish, Montana, for Appellants.

Gary R. Christiansen, Warden, Christiansen, Johnson & Berg, Kalispell, Montana, for Respondent.

Honorable JOHN WARNER ^*, District Judge, delivered the Opinion of the Court.

¶1 This is an appeal from a judgment of the District Court of the Eleventh Judicial District, Flathead County, entered July 24, 1998, in favor of Clara Mowrer and against Maurice Eddie and Peggy Eddie, in the

amount of$807,582.44, imposing a trust on certain of Eddies' property, and dismissing their petition to be appointed guardians and conservators of Mowrer. We affirm.

ISSUES

¶2 We restate and address the issues as follows:

¶3 Did the District Court abuse its discretion when it denied appellants Maurice Eddie and Peggy Eddie's motion to disqualify respondent's counsel, grant a mistrial, and order new discovery?

¶4 Does Montana or Kansas law apply in determining if transfers of property made in Kansas from Mowrer to the Eddies were the result of undue influence?

¶5 Is the evidence sufficient to sustain the judgment that Mowrer was acting under undue influence exerted upon her by the Eddies when she transferred property to them?

BACKGROUND

¶6 Clara Mowrer was born September 13, 1894. She lived in Kansas until August of 1995, when she was brought to Montana by her niece, Peggy Eddie, and her niece's husband, Maurice Eddie. She has remained in Montana and now lives at a care facility in Kalispell.

¶7 Mowrer fell and broke her hip in June of 1995. She was hospitalized for about two months. The day before she was released from the hospital, Peggy Eddie arrived in Kansas. Maurice Eddie arrived in Kansas shortly thereafter. Mowrer was released from the hospital in late July 1995 and returned home. The Eddies stayed with her in her home.

¶8 On August 5, 1995, Mowrer executed a durable power of attorney to the Eddies at her attorney's office in Kansas. That same day, several of Mowrer's bank accounts were closed, and the funds transferred to the Eddies. Other assets, including cash and certificates of deposit, were also transferred to the Eddies.

¶9 The Eddies brought Mowrer to Montana in late August of 1995. Before the end of that year, $594,715.00 of Mowrer's assets had been transferred to Peggy and Maurice Eddie by means of the power of attorney and upon Mowrer's signature. In addition, in September of 1995, Maurice Eddie received cashier's checks in the amount of $99,950.00, from certificates of deposit that had been owned by Mowrer.

¶10 In the fall of 1995, the Eddies took stock certificates with a value in excess of $300,000.00 from Mowrer's safety deposit box in Kansas, brought them to Montana, and made arrangements with a broker for the transfer of such stock to themselves on the death of Mowrer.

¶11 In October of 1995, Maurice Eddie consulted attorney James Johnson, a partner of Gary Christiansen, concerning Mowrer making a new will and filing a gift tax return. Near the end of this meeting Johnson and Maurice Eddie also discussed a possible estate plan for the Eddies. An appointment was made to return to Johnson's office with Mowrer. That appointment was not kept. Later, the Eddies took Mowrer to an attorney in Kalispell who had previously represented them and their family. This attorney prepared, and Mowrer signed, a new will that left all of her property to the Eddies. This new will excluded her other nieces, nephews, long-time friends, and charitable organizations to which she had bequeathed property in prior wills.

¶12 The Eddies used their power of attorney to spend Mowrer's money on living expenses and to acquire land, remodel their home, travel, and make gifts to their son and grandson. They also spent some of Mowrer's funds that are not accounted for.

¶13 During 1995, 1996 and until February, 1997, Mowrer lived with the Eddies. She then moved to the BeeHive care facility in Kalispell, where she still lives. On May 16, 1997, Mowrer revoked the power of attorney to the Eddies. Her counsel, Gary Christiansen, wrote the Eddies a letter demanding an accounting.

¶14 On June 19, 1997, Eddies filed a petition to be appointed guardians and conservators of Mowrer. She responded by resisting the appointment of either a guardian

or conservator, and counterclaimed for an accounting. Substantial discovery was undertaken. The trial took seven different days between December 22, 1997, and March 10, 1998. On July 27, 1998, the District Court entered its Findings of Fact, Conclusions of Law and Judgment. The court found that Mowrer was competent, did not need a guardian or conservator, had not made gifts to the Eddies and that the transfers to the Eddies had been the result of duress and undue influence. The court ordered the Eddies to repay $807,582.44 to Mowrer, and imposed a trust on certain real property owned by Eddies to secure the judgment. Eddies' motion for new trial was denied September 22, 1998, and they appeal from such denial.

DISCUSSION

Issue 1.

Did the District Court abuse its discretion when it denied appellants Maurice Eddie and Peggy Eddie's motion to disqualify respondent's counsel, grant a mistrial, and order new discovery?

¶15 Eddies first claim that Mowrer's counsel, Gary R. Christiansen, must be disqualified, the case be remanded for a new trial, and any discovery or other proceedings in which Christiansen participated be declared a nullity, stricken, and not used for any purpose. They assert because Maurice Eddie consulted with Christiansen's partner James Johnson in October of 1995 about a possible estate plan for themselves, as well as Mowrer's estate plan and gifts she had made to them, Christiansen had a conflict of interest. Thus, he must be disqualified from representing either side in this action.

¶16 Mowrer, acting through counsel Christiansen, called Johnson to testify on the fourth trial day, February 24, 1998. Johnson stated that he had represented Mowrer and described his October 11, 1995, meeting with Maurice Eddie only as it concerned her.

¶17 Prior to re-commencing the trial on March 4, 1998, Eddies moved for a mistrial on the grounds that a conflict of interest existed requiring that Christiansen be disqualified. The District Court heard the motion, found that Johnson had represented Mowrer and thus no conflict existed, and denied the motion. Eddies petitioned this Court for supervisory control, which petition was ultimately denied as Eddies had an adequate remedy by way of appeal.

¶18 The standard for review of the District Court's denial of Eddies' motion for a mistrial is whether the District Court abused its discretion. Garrison v. Averill (1997), 282 Mont. 508, 513, 938 P.2d 702, 705.

¶19 In support of their motion for mistrial, Eddies presented the District Court the affidavit of Professor David J. Patterson who instructs an ethics course at the University of Montana School of Law. Professor Patterson, based on the limited information he was given, was of the opinion that Christiansen should be disqualified from representing Mowrer based on Rules 1.8 and 1.9 of the Montana Rules of Professional Conduct, and related provisions of the American Bar Association Model Rules of Professional Responsibility. We do not necessarily disagree with Professor Patterson's interpretation of these rules, but reach a different conclusion based on an examination of the entire record, not merely the limited facts presented to him.

¶20 A lawyer may be disqualified from appearing in an action because he has previously represented an adverse party. It does not alter the situation that the relationship has terminated. The obvious reason is that an attorney cannot use information gained in confidence against the person confiding in him. Butler Bros. Dev. Co. v. Butler (1941), 111 Mont. 329, 351, 108 P.2d 1041, 1052; Oar Lock Land & Cattle v. Crowley (1992), 253 Mont. 336, 340, 833 P.2d 146, 148. Once an attorney is found to be disqualified, his firm is also disqualified. Trone v. Smith (9th Cir.1980), 621 F.2d 994, 999.

¶21 The record shows Maurice Eddie consulted Johnson on behalf of Mowrer. During such single conference they discussed Mowrer's assets, her previous actions, and what she purportedly wanted Johnson to do for her. At Johnson's insistence, an appointment was made for him to consult personally with Mowrer. Under such circumstances Eddies could not reasonably believe that Johnson represented them. Nor could they reasonably believe that such lawyer would not be free to relate the contents of such discussions to Mowrer or her representatives. Eddies could not reasonably believe they could prevent Johnson from divulging the details of such discussion, should Mowrer desire to do so. The District Court did not err in finding Johnson represented Mowrer.

¶22 Only information concerning Mowrer was described by Johnson in his testimony. He related no information whatever concerning Eddies' assets or possible estate plan. No such information was considered by the trial court. There was no breach of confidentiality requiring that Christiansen be disqualified. In Re Marriage of Bolt (1993), 259 Mont. 54, 61, 854 P.2d 322, 326.

¶23 Shortly after Johnson began his testimony, counsel for Eddies advised the court:

So there won't be any problem, we will waive whatever privilege may be attached. He can testify about whatever he wants. [Transcript, p. 922.]

Johnson continued his testimony without objection. According to Maurice Eddie, he only later realized that Johnson was the lawyer he had first consulted. He then moved to disqualify Christiansen. In May of 1997, ...