Jones v. Corn

• Docket Number: COA23-927
• Decision Date: 07 May 2024
• Citation: 902 S.E.2d 17
• Parties: Karen JONES, Jonathan Wayne Corn, Jan Franklin Corn, and Jessica Corn as mother and guardian ad litem of V.E.C. and J.R.C. (minors), Plaintiffs, v. Albert Hogan CORN, Joyce A. Corn, Kenneth Gregory Corn, and Glenda Sue Corn, Defendants.
• Court: North Carolina Court of Appeals

902 S.E.2d 17

Karen JONES, Jonathan Wayne Corn, Jan Franklin Corn, and Jessica Corn as mother and guardian ad litem of V.E.C. and J.R.C. (minors), Plaintiffs,

v.Albert Hogan CORN, Joyce A. Corn, Kenneth Gregory Corn, and Glenda Sue Corn, Defendants.

No. COA23-927

Court of Appeals of North Carolina.

Filed May 7, 2024

Cross appeals by Plaintiffs and Defendants from order entered 6 June 2023 by Judge William H. Coward in Henderson County Superior Court.Heard in the Court of Appeals 14 March 2024.Henderson County, No. 19 CVS 1432

James W. Lee, III, for Plaintiffs-Appellants-Appellees.

Barbour, Searson, Jones & Cash, PLLC, Asheville, by W. Scott Jones & W. Bradford Searson, for Defendants-Appellees-Appellants.

CARPENTER, Judge.

Both parties appeal from the trial court’s order denying Defendants’ motion for judgment notwithstanding the verdict("JNOV") and granting Defendants’ motion for a new trial.After careful review, we affirm the trial court’s order.

I.Factual & Procedural Background

This appeal is about siblings disputing their parents’ estate.On 15 August 2019, brothersAlbert Corn and Kenneth Corn sued their siblings, Karen Jones, Jonathan Corn, and Jan Corn, as well as V.E.C. and J.R.C.,¹ the grandchildren of their deceased brother, Chris Corn, for reformation of a deed.On 16 August 2019, in a separate case, Karen, Jonathan, Jan, V.E.C., and J.R.C. sued Albert and Kenneth for "lack of capacity/undue influence,""distribution of trust property," conversion, and breach of fiduciary duty.On 4 March 2022, the trial court consolidated the cases for trial.

Trial evidence tended to show the following.Albert Corn("Father") and Jeanette Corn("Mother") were manned and had six children: Albert and Kenneth ("Defendants"), Karen, Jonathan, Jan, and Chris ("Plaintiffs").²On 14 March 2008, Father and Mother executed two trusts (the "Trusts").Father was the grantor of one Trust, and Mother was the grantor of the other.Upon the death of Father and Mother, both Trusts named Defendants as co-trustees, and both Trusts mandated an equal distribution of Trust assets among Plaintiffs and Defendants.

Also on 14 March 2008, Father and Mother executed two wills (the "Wills").Under both Wills, Father and Mother bequeathed their property to each other.Under both Wills, the surviving spouse bequeathed his or her "tangible personal property" to Plaintiffs and Defendants.And under both Wills, the surviving spouse bequeathed his or her residuary estate, meaning all undisposed "real and personal property," to his or her Trust.

Father died 31 August 2015; Mother died 19 August 2016.But before their death, in 2014, Father and Mother hired attorney Nicole Engel to further advise them about estate planning and property ownership.Attorney Engel is a certified elder-law specialist.Defendants accompanied Mother and Father to their initial meeting with attorney Engel.After meeting with Father, Mother, and Defendants, attorney Engel instructed attorney Margaret Toms to prepare deeds (the "Deeds") for Father and Mother concerning their home (the "Home") and a separate tract of land (the "Tract").Attorney Toms prepared the deeds.

In the Home Deed, Father and Mother granted themselves a 99% share of the Home, and they granted each Defendant a .5% share of the Home.Father, Mother, and Defendants held the Home as joint tenants with right of survivorship.In other words, if Defendants outlived Father and Mother, Defendants would own the Home upon the death of Father and Mother.

In the Tract Deed, on the other hand, Father and Mother granted each of their Trusts a 49.5% share of the Tract, and they granted each Defendant a .5% share of the Tract.Like the Home, the Tract was held in joint tenancy with right of survivorship.But unlike the Home, Father and Mother’s deaths would not change the Tract’s ownership: The Tract would remain titled 49.5% to Father’s Trust, 49.5% to Mother’s Trust, and 1% to Defendants.In other words, the Tract would not become the exclusive property of

Defendants upon Father and Mother’s deaths.

After executing the Deeds, attorney Engel sent a "follow-up" letter to Father and Mother.In the letter, attorney Engel stated the following: "Thus, because you individually and as trustees of your revocable trusts have retained majority ownership interest in your real property, the [United States Department of Veterans Affairs] will consider that you have resources equal to the tax value of your ownership interest in your real property."

Unhappy with the results of the Tract Deed, Defendants asked for reformation because the Tract Deed did not match Father and Mother’s intent.Defendants sought to reform the Tract Deed to reflect Father and Mother, individually, as grantees, rather than their Trusts as grantees.Put differently, Defendants sought to reform the Tract Deed to reflect Father and Mother’s intention for the Tract to be owned exclusively by Defendants after Father and Mother’s deaths.

On the other hand, unhappy with both Deeds, Plaintiffs contended that the Deeds were invalid because (1)Father and Mother lacked capacity to consent to the Deeds, and (2)Defendants procured the Deeds through undue influence.And because the Home Deed was invalid, Plaintiffs argued that Defendants necessarily converted rental income from the Home after the death of Father and Mother.

Attorney Engel testified that Father and Mother intended for the Tract to pass to Defendants after Father and Mother passed.Attorney Engel also testified that Father and Mother"probably would not have know, you know, the fact that if [the Tract] stayed in the trust[, it] would not accomplish that goal."Attorney Engel continued: "between Margaret and I, Margaret Toms, we did make a mistake in that deed.And that didn’t accomplish what the Corns’ intention was."

Dr. MaryShell Zaffíno, Father’s primarycare provider from 2014 through 2015, never noted concerns about Father’s mental health.Dr. Jennifer Wilhelm was Mother’s primarycare provider from 2012 through 2015, and she noted that Mother had anxiety and depression.

Plaintiff Jan stated that Father was more depressed towards the end of his life.Further, she stated that Father experienced hallucinations after his 2014 heart surgery.But Plaintiff Jan also stated that, until his death, Father knew what property he owned, where his property was, and who his relatives were.Plaintiff Jan stated that Mother suffered from anxiety.

Plaintiff John stated that Father lacked capacity to execute the Deeds, and he said that Mother had "a lot of depression."Plaintiff Karen also thought Father lacked capacity to execute the Deeds; she also said that Father sometimes hallucinated.But Plaintiff Karen stated that, until his death, Father knew what property he owned, where his property was, and who his relatives were.Plaintiff Karen said Mother was depressed, and that Mother took several medications, which could disorient her.

Plaintiffs could visit Father and Mother until their deaths; their access to Father and Mother was unmitigated.Attorney Engel did not suspect that Father and Mother were unduly influenced by anyone.

In addition to the Home and the Tract, the parties also disputed the contents of a lockbox (the "Lockbox").Plaintiff Jonathan purchased the Lockbox for Father and Mother.Plaintiff Jonathan said that he put approximately $80,000 of Father and Mother’s cash into the Lockbox, and he never saw the Lockbox again.Defendant Kenneth said that Father, before his death, gifted him the Lockbox, so Defendant Kenneth did not report the Lockbox to Father’s estate.

On 8 March 2022, at the close of Plaintiffs’ ease, Defendants moved for directed verdicts concerning all of Plaintiffs’ claims.The trial court denied the motion.At the close of their case, Defendants renewed their directed-verdict motions concerning Plaintiffs’ claims and moved for directed verdict concerning their reformation claim.The trial court denied Defendants’ motions.

On 10 March 2022, the jury found the following: Father and Mother lacked capacity to execute the Deeds; Defendants unduly

influenced Father and Mother to execute the Deeds; the Tract Deed did not require reformation; Defendants converted rental income from the Home; Defendant Kenneth, but not Defendant Albert, converted the Lockbox and its contents; and Defendants owed punitive damages to Plaintiffs.

On 16 March 2022, Defendants moved for JNOV "as to all claims and issues, except the issues of [Defendant Albert] and the [Lockbox], and, in the alternative, for a new trial."On 6 June 2023, the trial court denied Defendants’ motion for JNOV and granted Defendants’ motion for a new trial.

[1] Orders granting or denying either JNOV or a new trial do not require the trial court to make findings of fact.SeeWilliams v. Allen,383 N.C. 664, 670–72, 881 S.E.2d 117, 121–22(2022);N.C. Gen. Stat. §§ 1A-1,Rules 50,59 (2023).Nonetheless, in its order denying JNOV and granting a new trial, the trial court found there was insufficient evidence to support the following jury verdicts: that Father lacked mental capacity to sign the Deeds; that Mother lacked mental capacity to sign the Deeds; that the Deeds were procured by Defendants’ undue influence; and that Defendants converted property from Plaintiffs.

On 3 July 2023, Plaintiffs filed notice of appeal.On 11 July 2023, Defendants filed notice of appeal.

II.Jurisdiction

This Court has jurisdiction under N.C. Gen. Stat. § 7A-27(b)(3)(d)(2023)(providing this Court jurisdiction over appeals from orders in which a superior court"[g]rants or refuses a new trial").

III.Issues

The issues on appeal are whether the trial court erred by: (1) denying Defendants’ motion for JNOV; or (2) granting Defendants’ motion for a new trial.

IV.Analysis

A.Motion for JNOV

On appeal, Defendants argue that the trial court erred by denying its motion for JNOV.We disagree.

[2, 3]We review JNOV rulings de novo.Hewitt v. Hewitt,252 N.C....