Robertson v. Campbell

• Decision Date: 02 November 1983
• Docket Number: No. 17504,17504
• Parties: Laverne ROBERTSON, Darlene Olsen and Eldon M. Johnson, Plaintiffs and Appellants, v. Thora J. CAMPBELL, Defendant and Respondent.
• Court: Utah Supreme Court

Page 1226

674 P.2d 1226

Laverne ROBERTSON, Darlene Olsen and Eldon M. Johnson Plaintiffs and Appellants, v. Thora J. CAMPBELL, Defendant and Respondent.

No. 17504.

Supreme Court of Utah.

Nov. 2, 1983.

George K. Fadel, Bountiful, for plaintiffs and appellants.

Ann Wasserman, Michael N. Emery, Salt Lake City, for defendant and respondent.

STEWART, Justice:

In a probate action prior to this suit, a will executed by Marinus Johnson, father of both the plaintiffs and defendant, was held invalid by reason of undue influence. The will devised and bequeathed to Thora J. Campbell a disproportionately large share of her father's estate. Plaintiffs, who are a brother and sisters of Thora Campbell, subsequently filed this action when they learned that their father had conveyed a large part of his estate to a trust, which was executed at the same time as the will, and which divided the property in the same manner as the will did. In this case, plaintiffs attack the trust on the same ground as the will, i.e., that it too was produced by their sister Thora's undue influence. They assert that the prior judgment holding the will invalid because of undue influence by Thora is determinative of the issue of undue influence as to the trust. The trial court rejected this argument and, on the ruling that plaintiffs had failed to meet their burden of proof, dismissed the suit on defendant's motion at close of plaintiffs' case in chief.

I. THE FACTS

During his life, Marinus Johnson was a rancher who owned large real estate holdings in Juab, Millard, and Salt Lake Counties. His estate also included substantial personal property comprised of equipment and stock.

Before he died, Marinus executed four wills. His first will, executed August 20, 1964, left all his property to his first wife. Her death in July, 1968, necessitated a second will. The second will, executed May 5, 1969, was drawn up at Marinus' request by an attorney who had handled his legal affairs for some fifteen years, and left $500 to his second wife, with the remainder of his property to be apportioned among his four children in equal shares. That will named his daughter Thora executrix. She had assisted him with his business dealings through the years and was familiar with his holdings.

Over a year later, when Marinus was approximately 74 years old and apparently still living with his second wife, Thora took Marinus to a law firm which had not previously handled Marinus' affairs, but had handled her affairs. There a new will with a different property distribution was executed. This will (the third), executed January 19, 1971, left the same amount of money to his second wife, $500, and reduced his son Eldon's share from an equal one-fourth of the estate to only $2,500. Thora was singled out to receive all the Juab County property (constituting the major part of the real property) and all the stock. The residue of the estate was to be divided into three parts, with one half to Thora, and one fourth each to LaVerne and Darlene. Thora was designated executrix.

The fourth will and the trust instrument at issue in this case were executed almost two months later on March 5, 1971. The will and trust were prepared, again with assistance from Thora, by the same law firm that prepared the third will, and those documents made the same disproportionate distribution of the estate as the third will. The trust was intended to be effective upon execution, and Marinus conveyed several parcels of real property to the trustee simultaneously with the execution of the trust agreement. The agreement directed that the trust income be paid to Marinus during his life and called for a distribution of trust property upon his death in the same manner as specified in the third will.

The fourth will referred to the terms of the trust agreement. Both contained the same provisions for the disproportionate distribution of property among the children as in the third will. At Marinus' death, the fourth will was to pour over into the trust the residue of his estate not previously transferred to the trust by inter vivos conveyances. Thora was again named executrix.

In approximately September, 1974, Marinus moved into Thora's home, apparently for health reasons. While there, he conveyed more property into the trust, and did so at least as late as October, 1975. On December 29, 1975, at the age of 79, he died.

A probate dispute arose among the children as to which will should be probated. Daughters LaVerne and Darlene petitioned for probate of the second will, which provided for an equal distribution of the estate among all four children. Thora objected to probate of the second will, arguing that it had been revoked by the subsequent wills, and she petitioned for the admission of the fourth will to probate. The primary issue put to a jury was whether the two 1971 wills (the third and fourth), which revoked the second will, were the product of undue influence exerted by Thora over her father, Marinus. On special interrogatories the jury found that Marinus acted under undue influence in executing the wills of January 19, 1971, and March 5, 1971. Accordingly, in March, 1978, the probate court declared the third and fourth wills invalid by reason of undue influence and entered a decree that the testamentary estate should be distributed according to the terms of the second will.

The effect of that decree on the distribution of the total estate was minor, however, as almost all the decedent's property had already been transferred by inter vivos conveyances into the trust. Only a small residue of the estate was left to pass under the terms of the second will. That, apparently, is the reason why Thora has now abandoned her appeal from the decree in the probate proceeding and why the present lawsuit was filed to set aside the trust.

LaVerne, Eldon, and Darlene filed the instant action against their sister Thora in July, 1978. The complaint alleged that the "trust agreement and all transfers, assignments and conveyances in relation thereto are invalid" by reason of undue influence exercised by Thora over Marinus. The complaint then listed those challenged conveyances, including those made at the time of the execution of the trust on March 5, 1971, as well as those made subsequently, thus placing them all in issue. Plaintiffs sought to have the trust and all related conveyances set aside so that the entire estate could be distributed equally according to the second will.

At the nonjury trial on the validity of the trust, plaintiffs contended that the prior probate judgment constituted a conclusive determination of the issue of undue influence in the creation of the trust. Alternatively, plaintiffs argued that Thora's confidential or fiduciary relationship with her father and her disproportionately large share of the inheritance created a presumption of undue influence which she failed to overcome. Defendant took the position that collateral estoppel did not apply because the two cases dealt with different issues. That is, the issue in the first case was the validity of the will; whereas in the instant case the issue is the validity of the trust. Defendant further argued that any presumption of undue influence, if one did arise, was rebutted by plaintiffs' own evidence. Defendant also maintained that even assuming undue influence on the day the trust was created, Marinus' subsequent transfers of property into the trust ratified the trust and its terms from its inception.

The trial court rejected plaintiffs' argument that the prior probate judgment was a conclusive determination on the issue of undue influence in the creation of the trust. The trial court's relevant findings were that "[t]he trust agreement and conveyances in connection therewith were not the product of undue influence exercised over Marinus Johnson by the defendant, or anyone," and that "[d]efendant did not stand in a fiduciary capacity as to Marinus Johnson." The court concluded that "the trust agreement and all conveyances made in connection therewith were, and are, valid." The court therefore dismissed plaintiffs' claims.

The plaintiffs contend that the trial court erred in ruling that (1) Thora was not collaterally estopped by the finding of undue influence in the will case, (2) she did not stand in a confidential relationship with her father, and (3) the acts of alleged ratification of the trust were not the result of undue influence.

II. COLLATERAL ESTOPPEL

Collateral estoppel is a branch of what once was lumped with other rules under the general doctrine of res judicata. Collateral estoppel is distinct from the rules of bar and merger--other branches of res judicata--in that it precludes relitigation only of issues actually tried in a prior action, and it may be invoked even though the subsequent cause of action is different from the former. E.g., Schaer v. State, Utah, 657 P.2d 1337 (1983); Searle Bros. v. Searle, Utah, 588 P.2d 689 (1978); In re West Jordan, 7 Utah 2d 391, 326 P.2d 105 (1958). See generally Penrod v. Nu Creation Creme, Inc., Utah 669 P.2d 873 (1983). It is not necessary that the parties who assert collateral estoppel against one who lost the issue in a prior case were also parties to the first action. Searle Bros. v. Searle, supra. However, collateral estoppel is also, of course, applicable when there is mutuality. Taylor v. Barker, 70 Utah 534, 262 P. 266 (1927). Furthermore, collateral estoppel may be invoked by either the plaintiff or defendant in a subsequent action, regardless of whether the prior suit was at law and the subsequent suit in equity, or vice versa. 46 Am.Jur.2d Judgments §§ 446-48 (1969); 50 C.J.S. Judgments §§ 691-92 (1947). See Matthews v. Matthews, 102 Utah 428, 132 P.2d 111 (1942). ¹

In the instant case the parties in the first and second actions are the same, except perhaps the plaintiff, Eldon Johnson (the record is not clear). Defendant's contention is that collateral...