Pense v. Lindsey

• Decision Date: 10 July 2003
• Docket Number: No. 01-666.,01-666.
• Citation: 2003 MT 182,73 P.3d 168,316 Mont. 429
• Parties: Rosie PENSE, Plaintiff and Respondent, v. Jack LINDSEY and Lee Lindsey, Defendants and Appellants.
• Court: Montana Supreme Court

73 P.3d 168

2003 MT 182

316 Mont. 429

Rosie PENSE, Plaintiff and Respondent, v. Jack LINDSEY and Lee Lindsey, Defendants and Appellants.

No. 01-666.

Supreme Court of Montana.

Submitted on Briefs April 18, 2002.

Decided July 10, 2003.

Thomas J. Pardy, Oliver, Pardy & Associates, Billings, Montana; James L. Carbone, Kelly, Harvey & Carbone, Clinton, Washington, for Appellants.

Torger S. Oaas, Lewistown, Montana, for Respondent.

Justice PATRICIA O. COTTER delivered the Opinion of the Court.

¶ 1 Rosie Pense (Pense) conveyed her 258-acre Fergus County homestead property to Jack and Lee Lindsey (Jack, Lee, or the Lindseys) by Warranty Deed. Shortly thereafter she requested that the Lindseys return the property to her. The Lindseys offered to return the land provided their names remained on the deed as joint tenants with rights of survivorship. This offer was rejected and Pense sued the Lindseys claiming they had exerted undue influence over her. The District Court agreed and set aside the conveyance. The Lindseys appeal. We affirm.

ISSUE

¶ 2 The dispositive issue in this case is whether the District Court erred when it concluded that the conveyance of land from Pense to the Lindseys was obtained by undue influence.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 3 Pense led a sheltered life on a ranch in one of Montana's most rural counties, Garfield County. Born in 1911, Pense lived, unmarried, on her parents' 14,000-acre ranch with them until their deaths in 1972 and 1973, at which time she inherited the ranch, as well as 446 acres in Fergus County which included her grandfather's beloved 258-acre homestead which is at issue in this case (homestead property). Approximately two years after her parents' deaths, at the age of 64, Pense married neighboring ranch-owner Paul Berger (Berger). Pense and Berger combined their Garfield County ranch lands and worked the combined ranches as one unit until 1998 when Pense and Berger separated. Pense, who was 87 years old at the time of the separation, then began managing her own affairs and living on her own for the first time in her life.

¶ 4 Pense and Berger were divorced in 2000 after 25 years of marriage. The net worth of the parties at the time of dissolution was $4,461,920. After equitable distribution of marital assets, Pense had a net worth of $2,490,498 with her grandfather's homestead property being valued at $170,000.

¶ 5 During her marriage to Berger, Pense met Jack Lindsey, a legal investigator, who was working with an attorney representing Berger in an unrelated Federal District Court matter. Upon conclusion of that matter in 1994, Pense and Jack had little or no contact until the spring or summer of 1998 by which time Pense was suffering from mild to moderate age-onset dementia according to her longtime physician. Pense's doctor explained that while Pense could continue to remain independent, her level of dementia would make it very difficult, if not impossible, to grasp and deal with complex situations such as wills or deeds. The doctor further opined that, as a result of Pense's sheltered upbringing, the dementia, and the difficulty in handling complex situations, Pense was quite "possibly susceptible to influence."

¶ 6 According to Garfield County Sheriff Charles Phipps, Jack called him in mid-to-late summer of 1998, having heard that Pense and Berger had recently separated, expressed an interest in buying Pense's Fergus County homestead property, and asked Phipps how to contact Pense. This call set in play a relationship between Pense and Jack, and a course of events that saw Pense authorize and then revoke no less than five wills over a period of eighteen months. The wills were prepared first by her divorce attorney Bryan, whom Pense later said prepared a will without being asked to do so; by Jack's employer Stephens, who prepared wills # 2 and 5 in the sequence to the benefit of Jack; and by Murnion, who acted as "local counsel" for both Bryan and Stephens, and who prepared two wills falling between the Stephens' wills that omitted any reference at all to Jack. The various wills were remarkable for their disparity—Pense went from endowing to disinheriting her cousins, ranch employees and Jack, usually without any apparent triggering events. One factor above all struck the District Court about these changes in bequest: when Stephens wrote the wills, Jack figured prominently in them, being named personal representative of Pense's estate and inheriting the homestead.

¶ 7 On November 30, 1999, Pense entered into a Land Lease Agreement with Calvin Paulson, Lee Lindsey's son. Under this Lease Agreement, Paulson could graze cattle, hunt and enjoy other recreational activities on the homestead property for a period of five years. As "payment" for these privileges, Paulson agreed to construct a "homestead" cabin to replace Pense's grandfather's homestead cabin. The following day, December 1, 1999, and thirteen days after signing Murnion Will # 2, in which Jack was not referenced, Pense executed Stephens Will # 2. In Stephens Will # 2, Jack was reappointed Personal Representative and was devised Pense's grandfather's homestead property.

¶ 8 In May 2000, the Lindseys took Pense for a picnic on her grandfather's homestead property. While there, they told Pense of their plans to rebuild her grandfather's home. The Lindseys testified that Pense was so grateful that she told them she wished them to have the property immediately rather than after her death. Very shortly thereafter, Jack requested that the Stephens law firm prepare a Warranty Deed, and on June 12, 2000, Pense signed a Warranty Deed giving Jack and Lee Lindsey her grandfather's homestead. The Warranty Deed was filed one month later and a certified copy was sent to Pense.

¶ 9 Upon receiving her copy of the Deed, an agitated Pense went to her longtime accountant, Fred Schell, and showed him the Warranty Deed. According to Schell's affidavit, Pense explained that, if (she questioned whether the signature was hers) she signed the Deed, she believed that she was signing an agreement giving the Lindseys access to her grandfather's homestead property for recreational purposes. She stated she did not intend to give this property to the Lindseys or to anyone else at that time. She requested his assistance in getting the property back.

¶ 10 After initial attempts to recover the property failed, Pense filed a Complaint on November 13, 2000. Subsequently, on November 17, 2000, the Lindseys, Pense, Schell and Sheriff Phipps met to discuss the property, at which time the Lindseys proposed to put her name on the deed with theirs as joint tenants with rights of survivorship. Schell recommended that Pense consider the offer for a few days before accepting or declining it. While not noted in the record, presumably the offer was rejected, as the law suit went forward.

¶ 11 In the time between Pense's visit with Schell regarding the Warranty Deed and December 21, 2000, Attorney Torger Oaas, at Schell's request, prepared a new Will for Pense. Under the Oaas Will, Jack was no longer Pense's Personal Representative nor were the Lindseys devisees or testamentary recipients. Additionally, two former ranch hands, Terry Kastner (Kastner) and Lonnie Dahl (Dahl), who between them had convinced Pense to pay them approximately $93,000 in unearned "back wages," were also disinherited.

STANDARD OF REVIEW

¶ 12 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. A finding is clearly erroneous if it is not supported by substantial evidence, if the trial court misapprehended the effect of the evidence, or if our review of the record convinces us that the district court made a mistake. In re Estate of McDermott, 2002 MT 164, ¶ 22, 310 Mont. 435, ¶ 22, 51 P.3d 486, ¶ 22. Moreover, 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 (citation omitted). Our role in reviewing findings of fact is to determine whether the findings are clearly erroneous; it is not to determine whether there is support in the evidence for findings which were not made. Bradshaw, ¶ 11 (citation omitted). Lastly, we review a district court's conclusions of law to determine whether they are correct. McDermott, ¶ 22.

DISCUSSION

¶ 13 We are asked to determine whether the District Court erred when it concluded that the conveyance of land by Pense to the Lindseys was obtained by undue influence in the form of friendship.

¶ 14 Section 28-2-407, MCA (1999), defines undue influence as: (1) the use by one in whom a confidence is reposed by another or who holds a real or apparent authority over him of such confidence or authority for the purpose of obtaining an unfair advantage over him; (2) taking an unfair advantage of another's weakness of mind; or (3) taking a grossly oppressive and unfair advantage of another's necessities or distress.

¶ 15 In addition to the statutory definition, courts are also guided by the following five criteria when attempting to discern whether there has been undue influence: (1) any confidential relationship between the person alleged to be exercising undue influence and the donor; (2) the physical condition of the donor as it may affect his or her ability to withstand influence; (3) the mental condition of the donor as it may affect his or her ability to withstand influence; (4) the unnaturalness of the disposition as it relates to showing an unbalanced mind or a mind easily susceptible to influence; and (5) the demands and importunities as they may affect the donor, taking into account the time, place and surrounding circumstances. Bradshaw, ¶¶ 13-14 (citation omitted). As we stated in Bradshaw, the statutory requirements control and these five...