In re Estate of Harms

• Decision Date: 07 December 2006
• Docket Number: No. 03-828.,03-828.
• Citation: 2006 MT 320,149 P.3d 557,335 Mont. 66
• Parties: In the Matter of the ESTATE OF Charles J. HARMS, deceased.
• Court: Montana Supreme Court

149 P.3d 557

2006 MT 320

335 Mont. 66

In the Matter of the ESTATE OF Charles J. HARMS, deceased.

No. 03-828.

Supreme Court of Montana.

Submitted on Briefs December 22, 2004.

Decided December 7, 2006.

For Appellants: A. Clifford Edwards, Roberta Anner-Hughes, Edwards, Frickle, Anner-Hughes & Cook, Billings, Montana; Kent E. Young, Red Lodge, Montana (Charles R. "Bo" Harms), John S. Warren, Davis, Warren & Hritsco, Dillon, Montana (Diann Stephens, Steven Harms, and Thomas Harms).

For Respondents: Keith Strong, Dorsey & Whitney, Great Falls, Montana.

Justice JAMES C. NELSON delivered the Opinion of the Court.

¶ 1 The Sixth Judicial District Court, Park County, determined that the last Will and Testament (2001 Will) of Charles J. Harms (Charlie) would be probated and that Charlie's son Dennis Harms (Dennis), as personal representative of Charlie's estate, would be awarded attorney fees and costs. Charlie's other children — Charles R. "Bo" Harms, Diann Stephens, Steven "Steve" Harms, and Thomas "Tom" Harms (hereinafter Contestants) — appeal. We affirm.

¶ 2 The Contestants raise the following issues on appeal:

¶ 3 1. Did the District Court err when it determined Charlie was competent to execute the 2001 Will?

¶ 4 2. Did the District Court err when it determined Charlie was not acting under undue influence in executing the 2001 Will?

FACTUAL AND PROCEDURAL BACKGROUND

¶ 5 Charlie owned the Harms Livestock Ranch located northwest of Livingston, Montana. Charlie and his wife, Bernice, were married in 1939. Together they had five children (listed above). Their oldest son, Bo, lived and worked on the ranch for over 30 years, leaving in the fall of 1991. Dennis spent his entire adult life working with his father on the ranch and was working on the ranch when Charlie died. Steve moved to Arizona, having never worked on the ranch during his adult life. While Tom lived on the ranch, he did not work on the ranch full-time during his adult life. While not living directly on the ranch, Diann took on different responsibilities with the ranch throughout her life, such as serving as secretary/treasurer of the ranch corporation.

¶ 6 Testimony from trial indicated that Charlie and Bernice planned to leave half of the ranch, the "Upper Ranch," to Bo and the remaining half, the "Lower Ranch," to Dennis. In 1993, four years before Bernice's death, Charlie and Bernice executed wills that divided their ranch property among their five children, with preferential treatment in ranch stock given to the children operating the ranch (Bo and Dennis). This plan included a life insurance policy which would pay benefits of $100,000.00 each to Tom, Steve, and Diann (the children who did not live and work on the ranch during their adult lives) upon either Charlie's or Bernice's death.

¶ 7 After Bernice's death in 1997 when the $100,000.00 life insurance policies were paid to Tom, Steve, and Diann, several meetings and discussions took place between Charlie, various members of the family, and occasionally representatives of the Crowley Law Firm in Billings, Montana regarding the disposition of the ranch upon Charlie's death. Despite these meetings, a new will was not prepared or executed until the 2001 Will was put in place.

¶ 8 In September of 2000, Charlie chose to cease his relationship with the Crowley Law Firm, instead retaining the services of Bjarne Johnson, a ranch estate tax and probate attorney in Great Falls, Montana. Charlie met with Johnson on September 19, 2000, to discuss estate planning options. Johnson testified that he had never met Charlie and did not know whether or not Charlie already had a will in place. Roughly one week after the initial meeting with Charlie, Johnson received an unsolicited e-mail from Diann which expressed concern regarding Charlie's plans. Specifically, the e-mail informed Johnson that Charlie had been represented by the Crowley Law Firm for roughly 30 years and that Charlie had been recently diagnosed with Alzheimer's disease. Johnson testified that Diann's e-mail prompted him to pay particular attention to the issues of Charlie's competence and any possible undue influence involved.

¶ 9 In response to these concerns, Johnson contacted Dr. Ted Scofield, Charlie's physician for the last year of his life. Dr. Scofield made it clear to Johnson that while Charlie did exhibit symptoms of mild senile dementia of the Alzheimer's type, Charlie was competent to make decisions regarding his estate. During the estate planning process, Johnson observed that Charlie was aware of the nature and extent of his property, the identities of and the relationships involved with his children at the time, and the reasons for estate planning. Further, Johnson testified that Charlie presented himself well and that ultimately, Charlie's goal was to avoid selling the ranch. Concerning Charlie's health, testimony at trial indicated that Charlie went through occasional episodes of confusion and incontinence. However, Charlie was self-sufficient in that he lived on his own at the ranch and was able to drive himself around the ranch as he saw fit.

¶ 10 Johnson drafted the 2001 Will (at the complete direction of Charlie) in the following fashion: Diann was disinherited; all corporate stock in the ranch was given to Dennis; and Bo was left with those assets still in his name as a joint tenant or payee on Charlie's pay-on-death accounts. Johnson was not able to meet Charlie in person to sign the 2001 Will. Thus, Johnson mailed a copy of the 2001 Will to Charlie on January 16, 2001, and subsequently mailed the original 2001 Will to Lance Lovell, an attorney in Big Timber, Montana. Johnson then asked Lovell to sit in his place to witness Charlie sign the original 2001 Will. Charlie signed the will on January 25, 2001, and died unexpectedly two days later, on January 27, 2001, of an apparent heart attack.

¶ 11 Dennis filed a petition to admit the 2001 Will to informal probate on February 5, 2001. Contestants opposed Dennis's petition, seeking the 2001 Will be set aside and for the District Court to declare that Charlie died intestate. The District Court held a bench trial on the validity of the 2001 Will. It heard testimony from numerous witnesses and entered findings of fact, conclusions of law, and an order. The court concluded that Charlie was competent to create and execute the 2001 Will. Moreover, the court determined that the 2001 Will was not a product of undue influence on the part of Dennis. The Contestants appeal.

STANDARD OF REVIEW

¶ 12 Section 3-2-204(5), MCA, and M.R. Civ. P. 52(a), require that in equitable cases like this one, findings of fact must be upheld unless they are clearly erroneous. In re Estate of Bradshaw, 2001 MT 92, ¶ 11, 305 Mont. 178, ¶ 11, 24 P.3d 211, ¶ 11. We must examine whether the findings are supported by substantial credible evidence. Bradshaw, ¶ 11. The evidence is reviewed in the light most favorable to the prevailing party, and the credibility of witnesses and the weight assigned to their respective testimony are up to the trial court. Bradshaw, ¶ 11 (citing In re Guardianship of Mowrer, 1999 MT 73, ¶ 36, 294 Mont. 35, ¶ 36, 979 P.2d 156, ¶ 36). Further, our role is not to determine whether there is support in the evidence for findings which were not made. Cenex Pipeline LLC v. Fly Creek Angus, 1998 MT 334, ¶ 35, 292 Mont. 300, ¶ 35, 971 P.2d 781, ¶ 35. We review a district court's conclusions of law to determine whether those conclusions are correct. Guthrie v. Hardy, 2001 MT 122, ¶ 24, 305 Mont. 367, ¶ 24, 28 P.3d 467, ¶ 24.

DISCUSSION

Issue 1.

¶ 13 Did the District Court err when it determined Charlie was competent to execute the 2001 Will?

¶ 14 The test for testamentary capacity was set forth in In re Bodin's Estate, 144 Mont. 555, 560, 398 P.2d 616, 619 (1965), as follows:

[A] testator is competent if he is possessed of the mental capacity to understand the nature of the act, to understand and recollect the nature and situation of his property and his relations to persons having claims on his bounty whose interests are affected by his will . . . . The "testator must have sufficient strength and clearness of mind and memory to know, in general, without prompting, the nature and extent of the property of which he is about to dispose, and nature of the act which he is about to perform, and the names and identity of the persons who are to be the objects of his bounty, and his relation towards them."

(Citations omitted). Therefore, testamentary capacity requires three elements that the testator be aware of: (1) the nature of the act to be performed; (2) the nature and extent of the property to be disposed of; and (3) the objects of his or her bounty. In re Estate of Prescott, 2000 MT 200, ¶ 34, 300 Mont. 469, ¶ 34, 8 P.3d 88, ¶ 34.

¶ 15 Testamentary capacity is determined as of the date the will was executed, January 25, 2001, in this case, using the above test from Estate of Bodin. Prescott, ¶ 35. Proponents of a will have the burden of establishing prima facie proof of due execution while contestants of a will have the burden of establishing lack of testamentary intent or capacity, undue influence, fraud, duress, mistake, or revocation. Section 72-3-310, MCA.

¶ 16 In the case sub judice, the Contestants challenge the District Court's finding that Charlie was competent to create and execute the 2001 Will. They argue there is no evidence that Charlie knew and understood the contents and effect of the document he was signing. The Contestants point out that it took Charlie a long time to read the will, that Charlie never recited the terms of the will or identified the parties involved in the will, and that no attorney ever went over the terms of the will with Charlie in draft or final form. The Contestants point to the testimony of Dr. Donna Veraldi, a psychologist, who testified that a person with some form of Alzheimer's disease often has the tendency to appear and act as if...