Court Determines If Sibling Procured Transfer of Land by Fraud and Undue Influence.
Richard Crawford, as administrator, sued his brother, Kenneth Smith, and alleged that a deed purportedly conveying certain real property from the parties’ mother, Jean T. Smith, to Kenneth was procured by fraud and undue influence. Jean died prior to the commencement of this action. The deed purportedly conveyed a fee interest in the real property to Kenneth, subject to Jean’s retention of a life estate in the property. After certain motion practice, the first cause of action, sounding in conversion, was dismissed.
The suit proceeded to a nonjury trial on the remaining causes of action. Richard sought to prove that Jean was mentally incompetent at the time she executed the deed and/or that Kenneth had exercised undue influence over her to procure the deed. In a decision after trial dated January 6, 2020, Supreme Court determined that Richard had failed to establish that Jean was mentally incompetent at the time she executed the deed or that Kenneth had exercised undue influence over her to procure the deed. Thereafter, the Court issued a judgment dated February 19, 2020, in favor of Kenneth and against Richard, in effect, dismissing the third through fifth causes of action in the complaint and declaring that the deed was valid and that Kenneth was the fee owner of the real property. Richard appealed.
A party’s competence to transfer property is presumed and the party asserting incapacity bears the burden of proving incompetence. A person suffering from a disease such as Alzheimer’s disease is not presumed incompetent and may execute a valid deed. Under such circumstances, in order to set aside a transfer of property on the ground of lack of capacity, it must be shown that, because of the affliction, the person was incompetent at the time of the transaction. The relevant inquiry is whether the person’s mind was so affected as to render her wholly and absolutely incompetent to comprehend and understand the nature of the transaction.
Here, there was no basis to disturb Supreme Court’s determination that Richard failed to establish that Jean was mentally incompetent at the time she executed the subject deed..
To invalidate an instrument on the ground of undue influence, there must be evidence that the influence exerted amounted to a moral coercion that restrained independent action and destroyed free agency or that, by importunity that could not be resisted, constrained a person to do that which was against his or her free will and desire, but which he or she was unable to refuse or too weak to resist. The burden of proving undue influence rests with the party asserting its existence. However, where the existence of a confidential relationship is established, the burden shifts to the beneficiary of the transaction to show that the transaction was fair and free from undue influence. To demonstrate the existence of a confidential relationship, there must be evidence of circumstances that show inequality or a controlling influence. A familial relationship alone is not enough to establish the existence of a confidential relationship.
Here, there was no basis to disturb Supreme Court’s determination that Richard failed to demonstrate the existence of a confidential relationship between Jean and Kenneth and otherwise failed to establish that Kenneth exercised undue influence over Jean to procure the deed.