Following Joan McBride’s death, her sons from her first marriage asserted claims against her second husband Charlie, who had served as Joan’s power of attorney and executor of her will. Joan and Charlie married in 1997 and remained married until Joan’s death in 2016. The sons claimed Charlie unduly influenced Joan in connection with certain lifetime transfers of Joan’s assets.

Charlie filed a motion for summary judgment, seeking dismissal of the claims against him.

One of the arguments asserted by Charlie was that, with regard to transfers of funds from one of Joan’s accounts to Joan and Charlie’s joint account, those transfers did not constitute “gifts” as a matter of law, because as a joint account-holder, Joan did not relinquish ownership and control over the funds. Because the creation of a joint account with right of survivorship is not an inter vivos gift, Charlie argued that the transfers were not subject to claims of undue influence. The trial court disagreed, concluding that undue influence is not limited to transfers that strictly comply with the legal elements of an inter vivos gift:

One can unduly influence a failing loved one to add one to an account that will inure to the benefit of the undue influencer upon the failing loved one’s passing. And if the confidential relationship persists, and the pernicious undue influence is exerted up till the death or incapacity of the failing loved one, undue influence can be established, notwithstanding that the failing loved one technically continued to possess the legal authority to withdraw the jointly-titled funds.

Having concluded that the undue influence claims could proceed as a matter of law, the judge then considered the merits of the claim in the context of the summary judgment motion.

The court began its analysis of the inter vivos transfers by distinguishing them from transfers in the context of a will contest. In a will contest, a presumption of undue influence arises where the contestant proves a “confidential relationship” between the decedent and the proponent of the will, and proves “suspicious circumstances” are present. With inter vivos transfers, “a presumption of undue influence arises when the contestant proves that the donee dominated the will of the donor, or when a confidential relationship exists between donor and donee.” The contestant need only establish that a confidential relationship was “more likely than not.” The court acknowledged that, in the context of a marital relationship,

although a confidential relationship naturally exists between spouses, the courts are extremely hesitant to shift the burden of proof upon one spouse to show that he or she was not guilty of exercising undue influence even where suspicious circumstances exist.

The court noted that a “confidential relationship” cannot be precisely defined. However, it recognized that this was Charlie’s motion for summary judgment, so the plaintiffs were entitled to “every reasonable inference of fact.” Accordingly, the court concluded that, for purposes of deciding the summary judgment motion, there was in fact a confidential relationship, “even more so than might exist between spouses where one person is not plagued with debilitating physical limitations.”

Because the court concluded that there was a confidential relationship, Charlie bore the burden of showing, by clear and convincing evidence,

not only that no deception was practiced therein, no undue influence was used, and that all was fair, open and voluntary, but that it was well understood.

The court found that Charlie was unable to meet this high evidentiary standard. Although it noted that “there is a substantial body of evidence in this record that would and may support a finding” in favor of Charlie at trial, it concluded that Charlie had not demonstrated that there was no genuine issue of material fact in order to show, clearly and convincingly, that there was no undue influence.

The sons’ claims against Charlie could proceed.

A copy of In the Matter of the Estate of McBride can be found here-  Matter of the Estate of Joan H. McBride N.J. Super. Chancery Div. (Contillo, P.J. Ch.)

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