Johnson v. Keener

• Citation: 370 So.2d 265
• Parties: Hoyt JOHNSON v. Jewell KEENER. 77-805.
• Decision Date: 27 April 1979
• Court: Supreme Court of Alabama

Page 265

370 So.2d 265

Hoyt JOHNSON v. Jewell KEENER.

77-805.

Supreme Court of Alabama.

April 27, 1979.

William L. Irons, Birmingham, for appellant.

Ralph L. Armstrong, Bessemer, for appellee.

JONES, Justice.

Appellee, Mrs. Jewell Keener, filed a complaint seeking to set aside two deeds conveying her fee simple interest in two separate parcels of property to herself and Appellant, Hoyt Johnson, jointly for life with remainder to survivor. Hoyt Johnson is the nephew of Jewell Keener. One of the parcels is located in Bessemer (Jefferson County), Alabama, and the other parcel is located in Clanton (Chilton County), Alabama.

Mrs. Keener's complaint, as amended, alleges in substance that she was urged by the defendant to sign certain instruments that were falsely and fraudulently represented to the plaintiff to be legal documents other than deeds. Particularly, in regard to the Bessemer property, Mrs. Keener's complaint states that her nephew falsely and fraudulently represented to her that she was signing a document necessary to insure that absolute title would be in her name, when, in fact, the instrument was a deed naming Jewell Keener as grantor and Jewell Keener and Hoyt Johnson as joint grantees for life with remainder to the survivor. Mrs. Keener's complaint alleges that the defendant had knowledge of the falsity of the statements when they were made and that she believed and relied upon these false representations in affixing her signature to the instruments.

Mrs. Keener also contends that there was a confidential relationship between herself and the defendant and that the defendant was able to unduly influence plaintiff to execute the two deeds made the basis of this action. Additionally, it is alleged that the transfers were made for grossly inadequate consideration.

At trial, Mrs. Keener testified that when she signed the deed to the Clanton property she was told and believed she was signing a power of attorney. Mrs. Keener testified that when she signed the deed to the Bessemer property she was told, and believed, that she was signing an instrument necessary to insure absolute title in herself after her husband's death. Mrs. Keener testified that her nephew's name was added to this instrument after she had signed it and that she was not aware that his name appeared on the instrument until many years after the deed was recorded.

The trial Court found that a confidential relationship existed between the defendant and the plaintiff and that the defendant was the dominant party. The trial Court further found that the defendant had failed to rebut the presumption, created when a confidential relationship is shown, that the transaction was a result of undue influence. Based on these findings, the trial Court set aside the two deeds in question. We reverse.

Undue influence can generally be defined as influence which dominates the grantor's will and coerces it to serve the will of another. Taylor v. Godsey, 357 So.2d 979 (Ala.1978); Terry v. Terry, 336 So.2d 159 (Ala.1976); Wyatt v. Riley, 292 Ala. 277, 293 So.2d 288 (1974). When the parties stand in confidential relationship and the evidence tends to show that the beneficiary is the dominant party, the law raises a presumption of undue influence and places on the beneficiary the burden to repel the presumption when the transaction is assailed. Wolfe v. Thompson, 285 Ala. 745, 235 So.2d 878 (1970); Taylor v. Godsey, supra.

Undue influence is a species of constructive fraud (Wyatt v. Riley, supra; Knox v. Knox, 95 Ala. 495, 11 So. 125 (1892)), and although difficult of direct proof, much latitude is allowed in the testimony. Orton v. Gay, 285 Ala. 270, 231 So.2d 305 (1970). It is because of the difficulty encountered in proving undue influence that the law provides a presumption of unlawful coercion where a beneficiary of a transaction is shown to have been in a confidential relationship with the grantor.

Fraud, on the other hand, is never presumed and the burden is on the one asserting fraud to prove it. Macon v. Alabama Mineral Land Co., 295 Ala. 222, 326 So.2d 715 (1977); Mangina v. Bush, 286 Ala. 90, 237 So.2d 479 (1970). Thus, while the law will closely scrutinize a transaction between parties in a confidential relationship to insure the absence of fraud, no presumption of fraud will arise merely because the relationship exists.

It is true that the words "fraud," "duress" and "undue influence" are frequently used interchangeably in will contests or in actions seeking to cancel instruments. Under the facts of many cases, it is a mere choice of terms. As noted above, undue influence is correctly considered a species of fraud.

Without question, undue influence invalidating a deed may have its foundation in false and fraudulent representations; but, for false and fraudulent statements to enter as an element into undue influence as a ground for setting aside a deed, it is necessary that the misrepresentation be shown to have been intermingled with or made the basis of importunities and mental pressure on the grantor. See In Re Carson's Estate, 184 Cal. 437, 194 P. 5 (1920).

Fraud in the sense of deceit is a ground for cancellation separate and distinct from that of undue influence. See Gockel v. Gockel, 66 S.W.2d 867 (Mo.1933); Estate of Ricks, 160 Cal. 467, 117 P. 539 (1911). See, also, Annot. 28 A.L.R. 790, supp. 92 A.L.R. 792, and cases cited therein.

At 79 Am.Jur.2d Wills § 410, the following is stated:

"It has been observed that fraud and undue influence are usually the very opposites of each other. Undue influence compels the testator to yield through fear and make a will (deed) which he would instantly repudiate if free and unconstrained, while fraud, although it may poison the mind of the testator, (grantor) leads him to use his testamentary power (power to grant) not only willingly, but often with pleasure and satisfaction, to disinherit persons who have the strongest natural claims upon his affections. Concisely stated, fraud wilfully deceives free agency, while undue influence overmasters it."

We add to this that fraud may also, as alleged in this case, so deceive the grantor as to make him unaware of the nature or results of his acts (i. e., signing a deed based upon the false representation as to the contents of the instrument). But this form of fraud is a form of misrepresentation or deceit and clearly is distinguishable from that species of fraud concerning the overpowering or domination of another's will.

In this case, the plaintiff testified that when she signed the deed in Clanton she was fraudulently induced by her nephew's representations to believe she was signing a power of attorney. As to the Bessemer property, the plaintiff testified that she was fraudulently induced by her nephew's representations to believe she was signing necessary documents to insure that absolute title was in her name after the death of her husband. This testimony is totally inconsistent with the theory of undue influence. This is not a case where a plaintiff is complaining that the signing of the deeds was a result of coercion, dominance of her will, fear, and/or duress. Instead, the plaintiff here asserts that she was defrauded, tricked, deceived into signing deeds under the belief that the documents she signed were legal documents other than deeds.

The plaintiff's testimony conclusively shows that the plaintiff can recover, if at all, only on a theory of fraud. As noted earlier, in a fraud case, no presumption arises from the fact that a confidential relationship exists and the burden is on the plaintiff to plead and prove the fraud. Even assuming that a Confidential relationship was shown to exist between aunt and nephew, and that the nephew...