Stephens v. Colley

• Court: Alabama Supreme Court
• Writing for the Court: STUART, Justice.
• Citation: Stephens v. Colley, 160 So. 3d 278 (Ala. 2014)
• Decision Date: 15 August 2014
• Docket Number: 1130609.
• Parties: Franklin Leroy STEPHENS v. Hazel COLLEY.

160 So.3d 278

Franklin Leroy STEPHENS

v.Hazel COLLEY.

1130609.

Supreme Court of Alabama.

Aug. 15, 2014.

Joel Lee Williams, Troy, for appellant.

Elizabeth M. Borg of McAdory Borg Law Firm, PC, Auburn, for appellee.

Opinion

STUART, Justice.

Franklin Leroy Stephens, the defendant below, appeals from an order of the Pike Circuit Court granting injunctive relief to the plaintiff below, Hazel Colley. We reverse and remand.

I.

In late 2011, Sara Frances Dees was residing at Troy Health and Rehabilitation Center following the amputation of her second leg as a result of diabetes and related circulation issues. On approximately January 15, 2012, Stephens—a nephew of both Dees and Colley—checked Dees out of the rehabilitation center and moved her back into her house in Troy. Stephens and an unidentified female companion also moved into the house and began caring for Dees. Colley alleges that Stephens thereafter began restricting access to Dees, preventing Colley and Dees's friends from speaking with her on the telephone or visiting with her outside his or his female companion's presence. Colley, who lives in Opelika, alleges that she had previously had a close relationship with her sister and had stayed with her for weeks at a time to help with her medical needs; however, she alleges, once Stephens moved into Dees's house Stephens would no longer allow her to stay with Dees overnight.

Over the course of 2012, Stephens's role in Dees's life continued to increase. In September 2012, Stephens scheduled two separate appointments for Dees with an attorney. At the first of those appointments on September 26, 2012, Dees executed a durable power of attorney designating Stephens as Dees's attorney-in-fact. At a second appointment on September 28, 2012, Dees executed a new will naming Stephens as executor and primary heir of her estate. These newly executed documents replaced a previous durable power of attorney naming Colley as Dees's attorney-in-fact and a will naming Colley as executor and primary heir of Dees's estate, both of which Dees had executed in July 2011.¹

Beginning in October 2012, Stephens also began taking Dees to the various financial institutions at which she had deposits and requesting that he either be added to all her accounts as a signatory or be named as the beneficiary on the accounts. The evidence in the record indicates that multiple bank employees involved in those requests were alarmed by Stephens's actions. For example, Kathryn Faircloth, a personal banker at Troy Bank and Trust, made the following statement in an affidavit submitted to the trial court:

“Mrs. Sara Dees has banked with Troy Bank and Trust for many years. In working with her on her banking needs, I met her sister, Hazel Colley, and have spoken with each of them often regarding Mrs. Dees checking accounts as well as several certificates of deposit. Mrs. Dees executed a power of attorney which named Mrs. Colley as her attorney-in-fact and supplied a copy of that to the bank. Mrs. Dees listed Hazel Colley as joint owner on her personal checking account and also as a pay-on-death beneficiary on certain certificates of deposit. Even when Mrs. Dees married Marion Dees, Hazel Colley remained on her checking account and some certificates of deposit as pay-on-death.^[ [^{2 ]} Marion was on the checking account for a period of time and then came off but Hazel remained on the checking account.

“Mrs. Dees was brought to the bank by Leroy Stephens in 2012, who stated that he was to be added as beneficiary of every financial instrument held by Mrs. Dees at [Troy Bank and Trust]. This included all of her certificates of deposit and her checking account. Mrs. Dees's appearance was drastically different from how she appeared in our interactions through the years. She did not appear alert or fully aware of the changes stated by Stephens. This was very out of character for Mrs. Dees because she always listed her sister Mrs. Colley as beneficiary on all of her certificates of deposit, even when she was married to Marion Dees. Mr. Stephens was so adamant to make these changes to Mrs. Dees's accounts that he called me regularly wanting to know when the paperwork on all certificates of deposit and bank accounts would be completed and ready for Mrs. Dees's signature.

“I grew concerned while making these changes because I noticed several large checks clearing out of her checking account. Each of the large checks were made payable to Leroy Stephens, most of them with the memo listed as ‘bills.’ Checks were also clearing her account for her bills in addition to these large checks made payable to Mr. Stephens. I immediately notified my supervisor of the large checks clearing her account that were abnormal from her typical usage. My supervisor then consulted the bank's security officer, who advised that absent any order from a judge that declared Mrs. Dees not competent, we could not refuse to add Stephens to her accounts or cash checks she signed made payable to Mr. Stephens.”

It appears that Stephens was thereafter successfully added as a signatory or beneficiary to all of Dees's accounts.

On February 16, 2013, Dees passed away. Thereafter, Stephens began exercising control of those accounts on which he had been listed as the payable-on-death beneficiary. The value of those accounts appears to have exceeded $300,000 at that time. On February 22, 2013, Stephens submitted Dees's will to the Pike Probate Court and petitioned the probate court to name him executor of Dees's estate consistent with the terms of that will; on March 1, 2013, the probate court granted that petition. On March 8, 2013, Colley separately moved both the probate court and the Pike Circuit Court to have the administration of Dees's estate removed to the circuit court. Colley simultaneously moved the circuit court to remove Stephens as the executor of Dees's estate pursuant to § 43–2–22(a), Ala.Code 1975, because Stephens had been convicted in 1990 of manslaughter.³ On April 17, 2013, the circuit court granted Colley's motion and ordered the administration of Dees's estate removed to the circuit court. Following a hearing on April 24, 2013, the circuit court also granted Colley's motion to remove Stephens as executor of Dees's estate. Pursuant to the terms of Dees's will, Stephens's daughter, Sonya S. Bolling, was eventually named as successor executrix of Dees's estate.

On August 26, 2013, Colley filed an amended complaint seeking to set aside the power of attorney and will executed by Dees in 2012, alleging that Dees was incompetent at the time those documents were executed and that Stephens had procured them via fraud, misrepresentation, and undue influence.⁴ On October 30, 2013, Colley initiated a new action asserting multiple undue-influence and breach-of-fiduciary-duty claims against Stephens. Colley simultaneously moved the circuit court to exhume Dees's remains and to consolidate this new action with the already existing action; the circuit court granted the motion to consolidate the next day.

Colley thereafter continued the discovery process, taking depositions and subpoenaing Dees's financial records. On February 19, 2014, after obtaining and reviewing those records, Colley moved the circuit court to enter a temporary restraining order barring Stephens from spending any further money that he had obtained from Dees's accounts or taking any action that would affect the title to Dees's house, in which Stephens continued to live after Dees's death. Colley also requested that Stephens be ordered to divulge where all assets formerly held by Dees were located and that Troy Bank and Trust and Wells Fargo be ordered to pay all funds in Dees's accounts, which were then held in Stephens's name, an amount totaling approximately $72,000, into the circuit court. Colley simultaneously moved the circuit court to enter a preliminary injunction extending the terms of the temporary restraining order until this litigation was resolved. The circuit court issued the requested temporary restraining order that same day and set a hearing on the motion for a preliminary injunction for February 24, 2014.

Following the February 24 hearing, which consisted entirely of arguments by counsel, Colley, on February 26, submitted a supplemental motion for injunctive relief to the circuit court, along with various affidavits and other documentary evidence. On February 27, 2014, the circuit court entered an order granting Colley the injunctive relief she had sought, stating:

“Having considered [Colley's] motion for injunctive relief, this court finds said motion well taken. Accordingly, it is ordered that all funds not previously frozen or transferred in accordance with the temporary restraining order issued on February 19, 2014, from Troy Bank and Trust in Troy, Alabama, Wells Fargo Advisors in Troy, Alabama, and Trustmark National Bank in Brewton, Alabama,^{[ 5 ]} in the name of Leroy Stephens be immediately paid to the Circuit Clerk of Pike County, Alabama, who is ordered to hold said funds until a final judgment is entered in the above styled case.

“It is further ordered that neither the Estate of Sara Dees nor Leroy Stephens shall transfer title, rent, lease, or dispense of the real property located at ... Avenue, Troy, Alabama, and that the aforementioned property shall remain in the name of Sara Dees, pending a final judgment in this matter.

“Defendant Franklin Leroy Stephens is barred from transferring, selling, or dispensing of any property received from Dees during her lifetime, and is further ordered to provide a complete accounting of assets obtained through the estate of Sara Frances Dees at the time of her death, including but not limited to: the 2010 Pontiac vehicle transferred to [Stephens] prior to Dees's death, all furnishings of Dees's home, all jewelry owned by Dees, and personal items of value.

“A copy of this order shall be provided to all counsel of record and to the below listed banks.”

On March 7, 2014, Stephens filed a...