In re Petition to Invalidate the William P. Baird Revocable Trust Dated Nov. 29, 2019
| Docket Number | File No. 2020-217/D |
| Decision Date | 17 October 2022 |
| Citation | 78 Misc.3d 527,185 N.Y.S.3d 879 |
| Parties | PETITION TO INVALIDATE the WILLIAM P. BAIRD REVOCABLE TRUST DATED NOVEMBER 29, 2019 |
| Court | New York Surrogate Court |
Alison Arden Besunder, Esq., Goetz Fitzpatrick, LLP, Attorneys for Petitioners, One Penn Plaza, Suite 3100, New York, New York 10119
Brian M. Newman, Esq., Blustein, Shapiro, Frank & Barone, LLP, Attorneys for Respondents, 10 Matthews Street, Goshen, New York 10924
Petitioner Mary Louise Baird Cardelli ("Mary") is one of Decedent's four surviving children. Respondents W. Robert Baird, Allen Baird and Charles Baird are the other three children of the Decedent. Petitioner Elizabeth Cardelli is Mary's daughter and granddaughter of the Decedent.
In a prior, pending proceeding, Respondents sought to admit Decedent's purported last will and testament dated October 31, 2019 (the "Purported Last Will") to probate. The Petitioners herein filed objections to probate.
The objections to probate stemmed from the Decedent's alleged departure from his prior testamentary plan, whereby he previously named Petitioner Mary Louise Baird as co-executor and 25% residuary beneficiary, in equal shares with her Respondent siblings, as evidenced by at least four prior wills and as recently as June 6, 2019. In contrast, Decedent's Purported Last Will (dated October 31, 2019) no longer names Petitioner Mary Louise Baird as co-executor and limits her beneficial interest to a specific bequest of $100,000.00, which is subject to an in terrorem clause.
Shortly after the Purported Last Will dated October 31, 2019, Decedent allegedly created his Revocable Lifetime Trust dated November 29, 2019 (the "Purported Trust"). The Purported Trust duplicated the testamentary plan of the Purported Last Will, limiting Petitioner Mary Louise Baird Cardelli to a bequest of $100,000.00, which was to be received one-time-only, under either the Purported Trust or the Purported Last Will. Similarly, Petitioner Elizabeth Cardelli was the recipient of a single bequest in the amount of $1,000.00 under either the Purported Trust or the Purported Last Will.
In the above-captioned proceeding, the Petitioners have sought to invalidate or set-aside the Purported Trust due to alleged lack of proper creation as to its execution and funding, lack of capacity to contract, undue influence, duress and fraud.
Respondents filed a pre-answer motion to dismiss the petition pursuant to CPLR § 3211. Petitioners opposed the motion to dismiss and filed a cross motion for leave to file an amended petition pursuant to CPLR § 3025(b), which Respondents have opposed.
On a motion to dismiss pursuant to CPLR 3211(a)(7) for failure to state a cause of action, the court must afford the pleading a liberal construction, accept all facts as alleged in the pleading to be true, accord the plaintiff/petitioner the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory. Clarke v. Laidlaw Transit, Inc. , 125 A.D.3d 920, 921, 5 N.Y.S.3d 138 (2d Dept. 2015). Whether the plaintiff/petitioner can ultimately establish the allegations of the pleading is not part of the calculus in determining a motion to dismiss. Lewis v. DiMaggio , 115 A.D.3d 1042, 1044, 981 N.Y.S.2d 844 (3d Dept. 2014).
On a motion for leave to amend a pleading pursuant to CPLR § 3025(b), the motion should be freely granted in the absence of prejudice or surprise, so long as the proposed amendment is not palpably insufficient or devoid of legal merit on its face and, thus, would withstand a motion to dismiss under CPLR § 3211(a)(7). Lucido v. Mancuso , 49 A.D.3d 220, 225, 851 N.Y.S.2d 238 (2008).
Contrary to Respondents’ arguments, the Petitioners have the legal capacity to challenge the validity of the Purported Trust because the Petitioners are beneficiaries thereof. See SCPA § 103(8), (19), (39) ; Matter of Kosmo Fam. Tr., dated July 18, 1994 , 72 Misc. 3d 1214(A), 2021 WL 3409360 (Sur. Ct. 2021), aff'd sub nom. Matter of Kosmo Fam. Tr., 207 A.D.3d 934, 172 N.Y.S.3d 501 (3d Dept. 2022) ; Constantine v. Lutz , 204 A.D.3d 1328, 1329, 168 N.Y.S.3d 134 (3d Dept. 2022). Thus, regardless of standing, as discussed below, Petitioners’ petition would not be dismissed since their interest gives them capacity to challenge the instrument.
Standing relates to having a stake or pecuniary interest in the matter being adjudicated. See Matter of Kosmo Fam. Tr., supra ; Constantine, supra. Respondents argue that Petitioners have no stake or pecuniary interest in the Purported Trust litigation because, even if successful in voiding the trust, Petitioners would be left with the bequests in the Purported Last Will, which are identical to those in the Purported Trust. Respondents’ argument, however, assumes the validity of the Purported Last Will, which has not yet been established in the pending probate proceeding. See, e.g., SPCA § 1408. Further, Respondents’ argument overlooks the substantial overlap of issues in these pending proceedings. For example, if the Petitioners were able to establish their undue influence claim to void the trust, they would likely be able to establish their undue influence objection to the probate of the will. In that instance, Petitioners would realize a change in stake/pecuniary interest in the estate. While, at this stage, it is hypothetical to say that the Petitioners’ claims/objections will defeat the Purported Trust and the Purported Last Will, it is equally hypothetical to say that they will not.
Respondents fail to present any relevant authority stating that the Petitioners must wait for the Purported Last Will to be invalidated in order to challenge the Purported Trust. The Stoller case, cited by the Respondents, is distinguishable. In In re Estate of Stoller [4 Misc. 3d 538, 780 N.Y.S.2d 861 (Sur. Ct. 2004) ], the court refused to entertain ancillary discovery proceedings until the probate proceeding was completed and the beneficial interests in the decedent's estate had been determined. However, the Stoller case concerned a beneficiary's attempted use of limited letters under SCPA § 702 to avoid triggering a no-contest clause in a will while, at the same time, building a case against the will or pressure for settlement concessions by the will's proponent. The Stoller court found that conduct to be contrary to the statutory purpose of SCPA § 702. Ultimately, the Stoller court did not permit that end-run around the will's no-contest clause by use of limited letters of administration pursuant to SCPA § 702 and neither did this Court in its previous Decision and Order, dated December 23, 2021, dismissing Petitioners’ SCPA § 702(9) proceeding under File No. 2020-217/B. The instant matter, however, is distinguishable from Stoller because, here, the Decedent created not only a will but a separate trust document, which is subject to its own challenges/attacks. While the Petitioners’ trust litigation may ultimately aid their probate litigation, Petitioners’ challenge of the Purported Trust comes as a result of Decedent's creation of the trust document, itself — not as a result of Petitioners’ abuse of a statute.
Petitioner's proposed amended petition contains a request for a declaratory judgment concerning the Purported Trust's allegedly invalid formation/funding. Respondents have failed to argue that this request was palpably insufficient or devoid of legal merit.
To be competent to enter into a contract, such as a trust, the grantor must comprehend and understand the nature of the transaction and be able to make a rational judgment concerning the particular transaction. Ortelere v. Teacher's Retirement Board of the City of New York , 25 N.Y.2d 196, 303 N.Y.S.2d 362, 250 N.E.2d 460 (1969) ; Matter of Lewis , 59 Misc. 3d 1217(A), 2018 WL 1885708 (Sur. Ct. 2018).
Contrary to Respondents’ arguments, the Petitioners need not establish incapacity at this pleading stage but, instead, allege circumstances that would put into question Decedent's ability to understand the nature of the transaction and to make a rational decision concerning the transaction. Petitioners have alleged sufficient circumstances concerning, among other things, the Decedent's age and health, as well as his sensory and communication abilities. Such allegations may be far from the point of establishing a claim of incapacity but they are also far from palpably insufficient or devoid of legal merit.
Upon a reading of the petition, it is reasonable to infer that the exertion of undue influence upon the Decedent was possible given the relationship, circumstances and transactions alleged. See Aponte v. Estate of Aponte , 172 A.D.3d 970, 973, 101 N.Y.S.3d 132 (2d Dept. 2019) (). Whether such exertion of undue influence can be established in this proceeding is a question of proof, which does not have to be answered at the pleading stage. Estate of Aponte , 172 A.D.3d at 973, 101 N.Y.S.3d 132 ().
In order to maintain a claim of duress, there must ultimately be a demonstration that the threat of an unlawful act deprived a party of their free will and compelled that party's performance of an act which the party the legal right to abstain from performing. Polito v. Polito , 121 A.D.2d 614, 614—15, 503 N.Y.S.2d 867 (2d Dept. 1986).
Here, Petitioners’ allegations concerning duress describe a potential environment of physical and/or psychological intimidation that could, if...
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