Articles Posted in Probate and Trust Litigation

In Tennessee will contest cases where wills are challenged on the basis of undue influence, outcomes are often difficult to predict and depend on the unique facts of each case. A recent Tennessee case proves that point. As the Court of Appeals of Tennessee noted when it affirmed the decision of the jury that there was no undue influence, there was evidence in the case to support that the will was the result of undue influence, but there was also evidence to support that it was not.

The proof at trial showed:

• The maker of the will, a Elizabeth Jones (“Decedent”), was about 93 years old in 2010 when she changed a will she had made in 1985
• In her 1985 will, the Decedent had left her assets, except for certain real property, to her nieces (who were the parties challenging the 2010 will)
• In the 1985 will, the Decedent had left the real estate in question to her stepson
• In her 2010 will, the Decedent left all of her assets to her stepson and disinherited her nieces
• Stepson began living with the Decedent when he was 5 years old, and then moved next door to her with his wife in 1985
• Decedent suffered a stroke in 1985, but her doctor testified that she was mentally competent and had no mental deficits from the stroke at the time Decedent executed her 2010 will
• Stepson admitted that he assisted Decedent by cashing her checks, and taking her to doctors appointments
• Stepson had a gate installed at Decedent’s house which he claimed he did to keep strangers from coming to her home when she was alone
• A family friend testified that the Decedent was “always sharp-minded”
• Another friend of Decedent testified that Decedent’s home smelled of urine and caused her to call the Tennessee Department of Human Services (“Department”)
• An employee of the Department visited with Decedent and concluded that she was not being neglected
• Another friend of the Decedent testified that Decedent had expressed to him that she wanted to make a new will and that, thereafter, he helped her obtain the will she executed in 2010 from Legal Zoom
• The friend who helped Decedent with the 2010 will testified that, although she was frail, Decedent was still competent

The jury determined that there was no undue influence and upheld the validity of the 2010 will. The nieces appealed. The court of appeals affirmed the jury verdict. On the facts of this case, and considering the deference given to jury verdicts on appeal, that outcome was a foregone conclusion, in my opinion.

Setting aside a jury verdict in this will contest case would have required the court of appeals to conclude that there was no material evidence to support the jury’s verdict.

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Spouses, children and parents, or other persons, who may be heirs of each other, sometimes die because of common accidents or disasters. As well, even in the absence of a common disaster or accident, sometimes spouses die within a short time of each other.  When those tragic events or nearly contemporaneous deaths occur, the Tennessee Uniform Simultaneous Death Act may be applicable.

Under the Act, the operative time period is 120 hours, or 5 days. If a spouse dies within 120 hours of his or her wife or husband, then, that spouse is deemed to have predeceased the other spouse for purposes of receiving homestead allowance, year’s support allowance, exempt property, and elective share.  The presumption also applies, importantly, for purposes of determining who the heirs are when the spouse who died first died without a will (when someone dies without a will, his or her property is distributed according to the laws of intestate succession).

Here is an example of how the Act would apply in a situation where the spouse who died first died without a will: Husband and Wife were married late in life and each has a child by another marriage who is not the child of the other spouse. Wife has an investment account worth $300,000 which she, alone, owns. As well, Wife has made no payable on death or survivorship designation on the account. Neither Husband nor Wife has a will.

Husband and Wife are in an accident. Wife dies at the scene of the accident and Husband dies two days later.  If not for the Act, Husband’s child would inherit one-half of Wife’s account, or $150,000. This is so because, under Tennessee intestate succession law, Husband would be entitled to one-half of the $300,000, and Wife’s child would be entitled to the other one-half.

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It happens that marriages occur, but children of one of the marrying spouses are not adopted by the other spouse. It also happens that these children are treated by the non-adopting spouse just like his or her own children despite never being formally adopted.  So, what are the rights of children in such situations to the assets of the man or woman who, for all practical purposes, became their mother or father, when that man or woman who was not their natural parent and who never officially adopted them passes away?

The answer to the above question depends on, at least, several factors. If the deceased non-natural parent died without a will and did not leave any assets via a joint account, payable on death or other account beneficiary designation (non-probate assets), then the never-adopted child is out of luck. Under Tennessee probate law, when a person dies without a will, the only children who may inherit are natural children and adopted children.  That’s it. No exceptions.

If, however, the non-natural parent who died left assets payable on death (non-probate assets) to his or her “children,” it is quite possible that a person the deceased considered and treated like a child, even though that person was never formally adopted, might share in those assets. In the case of In re Estate of Elrod (Tenn. Ct. App. 2015), that very outcome occurred.

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In a recent will contest case, both the trial court and the Court of Appeals of Tennessee let it be known that the current state of the law in Tennessee regarding who has standing to bring a will contest case can result in a major injustice. Both courts also invited the Supreme Court of Tennessee to change the law.

Here is what happened in the case, In re Estate of J. Don Brock:

• Don Brock had five adopted children (“Contestants”)
• Mr. Brock also had a wife
• Mr. Brock executed a will in 2013
• The 2013 Will disinherited the Contestants, and left the assets of the estate (“Estate”) to Mr. Brock’s wife
• Mr. Brock died
• The 2013 Will was submitted to probate
• The Contestants filed a notice of will contest based on undue influence, fraud, lack of testamentary capacity, and improper execution
• The Chancery Court entered an agreed order that the Contestants had standing to challenge the 2013 Will and transferred the case to the Circuit Court for the will contest trial
• The Estate filed a motion to transfer the case back to Chancery Court on the basis that the Contestants did not have standing to challenge the 2013 Will
• The grounds for the Estate’s position was that there was a newly discovered 2012 Will which also disinherited each of the Contestants
• The Circuit Court granted the motion of the Estate. It determined that the Contestants did not have standing because, even if the 2013 Will was set aside, the Contestants would still receive nothing because of the 2012 Will
• The Contestants then filed a motion to amend their notice to contest, not only the 2013 Will, but also, the 2012 Will (as well as some wills before 2012)
• Under the wills executed before the 2012 Will, some of the Contestants would be entitled to recover if both the 2013 Will and the 2012 Will were found to be invalid. If all of the wills before the 2012 Will were held to be invalid, all of the Contestants would recover
• Applying existing Tennessee law, the Chancery Court determined that the Contestants did not have standing to bring a will contest case

So, what Tennessee law compelled the ruling of the Chancery Court which slammed shut the courthouse doors to the Contestants? How could the ruling be fair given the possibility that the Contestants might be able to prove that both the 2012 Will and the 2013 Will were invalid, in which event, it was undisputed that they would be entitled to assets of their father’s estate?  The first question is easy to answer. I do not have an answer to the second question (just like the trial court and appellate court did not).

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In Tennessee, either a husband or a wife whose spouse has died has the right to elect to receive, from the deceased’s spouse’s assets, an amount allowed by a Tennessee statute, sometimes called the elective share statute, as opposed to receiving the amount left to him or her under the deceased’s spouse’s will.

Where a spouse has died without a valid will, the surviving spouse may also elect to receive the amount to which he or she is entitled pursuant to the elective share statute, as opposed to what he or she would receive under the statutes that prescribe what amount a surviving spouse receives when the deceased spouse did not leave a will. (Under Tennessee law which governs intestate estates, which are estates of those who have died without a valid will, a surviving spouse is entitled to the entire residue of deceased’s spouse’s estate where there are not children, and to the greater of one-third or a child’s share where there are children).

The amount of a surviving spouse’s elective share is based on the length of the marriage as follows:

Less than 3 years                                                     10% of the net  estate

3 years or more, but less than 6                         20% of the net estate

6 years or more, but less than 9                         30% of the net estate

9 years or more                                                        40% of the net estate

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In Tennessee, many spouses have joint bank accounts with rights of survivorship. Such accounts are considered accounts held by the spouses as “tenants by the entirety” unless the spouses have specifically agreed otherwise. Such accounts are referred to as “tenancy by the entirety accounts” or “entireties accounts.”

A tenancy by the entirety account is a form of ownership which is only available to spouses. Under Tennessee law, each spouse owns the entire account, and, when one of the spouses dies, the other spouse continues to own the entire account.

In a recent probate case which made it on appeal to the Court of Appeals of Tennessee, the Court of Appeals made some new law on tenancy by the entirety accounts. The case is In re Estate of Fletcher and here are the facts and procedural history:

• Husband and Wife opened a joint account with a right of survivorship (which was deemed to be a tenants by the entirety account)
• Husband and Wife deposited $100,000 in the account which they received from re-financing their home
• According to the account agreement, either Husband or Wife could withdraw funds without the signature of the other
• After the account was opened, Husband withdrew $100,00 from the account and bought a certificate of deposit (“CD”)
• The CD was in Husband’s name only
• Husband died with a will in place (died testate)
• Husband’s will provided that his children (“Children”) were entitled to his personal property which included the CD
• Husband’s will was admitted to probate
• In the probate litigation, Wife contended that the CD was not part of Husband’s estate and Children contended that it was
• The probate court held that the funds in the CD ceased to be owned by the entireties when Husband withdrew the funds from the entireties account and bought the CD in his name only
• Under the holding of the probate court, the funds in the CD were, therefore, personal property owned by Husband at the time of his death, and, therefore, were part of his probate estate
• Under the holding of the probate court, Children, not Wife, were entitled to the funds from the CD

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In Tennessee, family members and non-family members alike often provide care, perform services or pay for expenses for someone who passes away without compensating the person who provided the care or services or who paid expenses on their behalf. Can a family member or non-family member recover for care, services or expenses provided to someone while they were alive, after that person dies? The answer is: Sometimes they can, and sometimes they can’t.

If the person who provided the care, services or who paid the expenses (the “Provider”) has a valid and enforceable written agreement between him or her and the person who passed away (the “Deceased”), which is often not the case, then recovery against the estate of the Deceased should not be a problem (provided the probate estate has assets to pay the debt).

Frequently, life is not so orderly that a Provider receives an enforceable written agreement. Sometimes, death occurs before the Deceased was able to make arrangements to compensate the Provider by changing his or her will or by preparing a written agreement that will allow the Provider to recover. Sometimes, neither the Provider nor the Deceased anticipate that payment to the Provider will be a problem after the Deceased is gone, but it certainly can be.

If there is no enforceable written agreement between the Deceased and the Provider and the Deceased’s will or trust does not provide for payment to the Provider, whether a Provider can still recover for services, care or expenses paid is best approached by first determining whether the Provider was a family member or not. Why? Because the standard for recovery in such situations may well differ depending on whether the Provider was a family member or not, as explained more fully below.

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