Workman v. Workman (In re Estate of Workman)

• Citation: 903 N.W.2d 170
• Decision Date: 20 October 2017
• Docket Number: No. 15-2126,15-2126
• Parties: In the MATTER OF the ESTATE OF Margaret E. WORKMAN, Deceased, Dennis Workman, Appellant, v. Gary Workman, Individually and as Executor of the Estate of Margaret E. Workman, Appellee.
• Court: Iowa Supreme Court

903 N.W.2d 170

In the MATTER OF the ESTATE OF Margaret E. WORKMAN, Deceased,

Dennis Workman, Appellant,

v.Gary Workman, Individually and as Executor of the Estate of Margaret E. Workman, Appellee.

No. 15-2126

Supreme Court of Iowa.

Filed October 20, 2017

Eric M. Updegraff of Hopkins & Huebner, P.C., Des Moines, for appellant.

Daniel P. Kresowik of Stanley, Lande & Hunter, P.C., Davenport, for appellee.

MANSFIELD, Justice.

This review of a will contest proceeding raises two questions for our consideration. First, the unsuccessful will contestant asks us to adopt the Restatement (Third) of Property standard concerning the appropriate burden of proof in an undue influence case where a confidential relationship existed. Second, the contestant argues the district court abused its discretion in denying his motion to amend the pleadings to conform to the proof at the close of his case. That motion sought to broaden the contestant's undue influence claim to include all of the testator's prior wills and codicils.

We conclude the first issue is not preserved for our review. The contestant asks us to overturn a ruling on burden of proof that was incorporated within a pretrial order denying summary judgment. Yet the contestant never renewed his position at trial. Instead, when presented with jury instructions that reiterated the same burden-of-proof standard, the contestant indicated he had no objection. Iowa Rule of Civil Procedure 1.924 requires more.

On the second issue, we find no abuse of discretion. The district court correctly determined that this last-minute amendment would have broadened the issues and the proof. Also, this case falls within our precedent upholding denials of motions to amend under Iowa Rule of Civil Procedure 1.457 when the motion is based on facts the movant knew or should have known before trial. See, e.g. , Meincke v. Nw. Bank & Tr. Co. , 756 N.W.2d 223, 229 (Iowa 2008). Accordingly, we vacate the decision of the court of appeals and affirm the judgment of the district court.

I. Background Facts & Proceedings.

Margaret Workman died on December 26, 2012, at the age of eighty-nine, survived by her husband, LaVerne Workman, and their three children, Dennis, Gary, and Cynthia. Long before Margaret's death, Gary had decided to move back home to farm in eastern Iowa. For the next thirty-one years until his mother's death, Gary lived within five miles of his parents and saw them on a nearly daily basis as he farmed with them. Dennis, however, took up residences around the country and became involved in a number of business ventures, several of which were unsuccessful.

Margaret's will and codicil were admitted to probate on January 24, 2013. Margaret had previously executed a series of wills and codicils that provided for the distribution of her personal and real property and established a trust for the benefit of her husband and son Dennis.

At her death, Margaret owned approximately 200 acres of farmland, and she was supremely concerned about what would happen to this land at her passing, often discussing the issue with her family and her attorneys. Margaret became, according to her attorney, "obsessed with her estate-planning documents." From 1983 to 2008, Margaret altered her distribution plan through either will or codicil no fewer than ten times.

Margaret's initial will, executed in 1983, provided a life estate for her husband in all of her personal property and the homestead. The farmland was to be divided into three parcels, with LaVerne receiving forty acres and Gary and Dennis receiving eighty acres each. In the event LaVerne predeceased Margaret, Gary's daughter Christine would inherit the forty acres that would have been LaVerne's, and the remaining 160 acres would go entirely to Gary, with Dennis inheriting none of the farmland. Apparently concerned about the possibility of Dennis's numerous creditors reaching the farmland, Margaret later executed a codicil to this will to create a spendthrift trust for Dennis's benefit.

The next few wills made shifts in the property distribution, many of which benefited Gary, in response to Gary's work on the farm for his parents. Margaret noted the apparent discrepancy for the first time in her 1987 will, in which she stated, "It may appear that I have provided more generously for my son, Gary, than my other two children, but in part it is in repayment for work and improvements he has done on our farmlands." Every subsequent will executed by Margaret contained similar precatory language.

The final will, executed in 2007, passed the homestead to the Workman Family Trust, subject to a life estate for LaVerne and a right of first refusal to purchase in favor of Gary, and distributed 160 of the 200 acres of farmland in life estate to LaVerne, with the remainder passing to Gary. Gary's interest was subject to $25,000 in equalization payments to be paid by him at $2500 per year over a ten-year period. The remaining forty acres of land went to Gary's two children. The will contains the following statement by Margaret, similar to the one first included in the 1987 will:

My husband and I wish to formally acknowledge that we recognize and understand that the cumulative effect of our Wills and The Workman Family Trust will be to give our son, Gary, a disproportionately large share of our combined assets. We have intentionally and knowingly made these provisions understanding that Gary will receive more of our combined estates than our other two children. We have done this to recognize the many years of contribution and effort made by Gary, which has benefitted us over the years that he has lived near us. The statement I am making in this paragraph is merely precatory and intended to express my intent.

In 2008, Margaret executed a codicil to the 2007 will, adding a provision to prevent the sale of the farmland for a period of three years. In the event the farmland was sold within three years of Margaret's death, the proceeds from the sale in excess of $5000 per acre would be divided equally among Gary, Cynthia, and the Workman Family Trust.

Several months after Margaret's death, on June 14, 2013, Dennis filed a petition to set aside the 2007 will and the 2008 codicil in the Iowa District Court for Scott County. The petition alleged both undue influence by Gary and lack of testamentary capacity on the part of Margaret, and also sought the imposition of a constructive trust. On July 9, 2014, Gary filed a motion for summary judgment seeking dismissal of the case. After an opportunity for discovery, on March 12, 2015, the district court granted in part and denied in part Gary's motion. The court dismissed the testamentary capacity and constructive trust claims but denied summary judgment as to undue influence.

In his resistance to the motion for summary judgment, Dennis had argued that the existence of a confidential relationship between Gary and Margaret shifted the burden to Gary to prove that there was no undue influence. Although the district court ultimately denied summary judgment on the issue of undue influence, the court disagreed with Dennis's contention that the burden would shift for a testamentary transfer:

[I]t appears as if this analysis is only considered when inter vivos transfers are involved. See In theMatter of Estate of Todd , 585 N.W.2d 273, 277 (Iowa 1998).... Here, we only have testamentary transfers at issue and thus the burden shifting does not appear to apply. It remains for the Plaintiff to establish at trial the Defendant unduly influenced Mrs. Workman and there is a fact question precluding summary judgment on that issue.

The case proceeded to trial on the undue influence claim. At the close of the plaintiff's case, Dennis moved to amend the pleadings to conform to the proof to allow the jury to consider undue influence for the entire series of wills and codicils Margaret made from 1983 to 2008. Neither the initial petition nor the amended petition had challenged the earlier wills. Ruling from the bench, the court denied the motion to amend, stating,

[B]ecause the defense has prepared their whole strategy and their whole basis of this case in defending the 2007 Will and the 2008 Codicil and did not defend the earlier Wills, there could have been and would have been ... much different proof presented [and] many different witnesses called, it's too late in the game and the motion to amend is denied.

Only Gary submitted proposed jury instructions. At the close of evidence, in accordance with Gary's proposed instructions, the jury was instructed that "[t]he law presumes a person is free from undue influence," and to overcome this presumption, Dennis had to prove "[t]he result was clearly brought about by undue influence." Dennis never objected to these instructions or requested alternate instructions shifting the burden of proof to Gary.¹

The jury returned verdicts in Gary's favor finding no undue influence as to either the 2007 will or the 2008 codicil.

Dennis appealed, challenging the summary judgment ruling that he had the burden of proving undue influence and the later denial of his motion to amend the pleadings to conform to the proof. On the former point, Dennis urged adoption of the Restatement (Third) of Property: Wills and Other Donative Transfers section 8.3, comment f , which provides that

[a] presumption of undue influence arises if the alleged wrongdoer was in a confidential relationship with the donor and there were suspicious circumstances surrounding the preparation, formulation, or execution of the donative transfer, whether the transfer was by gift, trust, will, will substitute, or a donative transfer of any other type.

Restatement (Third) of Prop.: Wills & Other Donative Transfers § 8.3 cmt. f , at 145 (Am. Law Inst. 2003) [hereinafter Restatement (Third) ]. Gary responded that both trial court rulings were correct and also that Dennis had failed to preserve error with regard to the allocation of the burden of proof in an undue influence case. We...