Plaintiff rented out a condominium to his mother and the decedent, his mother’s husband. The couple paid the mortgage payment directly to the mortgage holder.  After plaintiff’s mother died, the decedent continued to live in the residence and pay the mortgage.  After the decedent passed away, the plaintiff filed a claim for unpaid back rent. The plaintiff claimed that he did not charge the couple full rental value during the decedent’s lifetime because of a promise that the outstanding balance would be paid back through a provision in the decedent’s will. In other words, he claimed that the decedent promised to leave the plaintiff something in his will. The Personal Representative filed a disallowance of the claim.   The plaintiff thereupon filed a complaint in the probate court on the theories of breach of contract, promissory estoppel, and quantum meruit (an equitable theory to receive remuneration on the basis of fairness).

The probate court dismissed the case on the basis that MCL 700.2514, which requires that contracts to make a will must be in writing,  barred the action.  The probate court raised this statute on its own.  The plaintiff claimed on appeal that it was error for the probate court to raise this statute on its own.  The plaintiff claimed that his case was an ordinary breach of contract action.  The Court of Appeals disagreed.  The Court of Appeals held that a party’s choice of labels for a cause of action is not dispositive.  A party cannot avoid the dismissal of a cause of action through “artful pleading.”  The Court of Appeals further held that MCL 700.2514 directly applied to this situation.  This statute provides that a contract to make a will, or to die without a will, must be in writing.  The Court of Appeals held that because the terms of the alleged contract in this case were to arise after death, it was clearly an agreement to make a will.  Since it was not in writing, it was unenforceable.  The trial court correctly dismissed the case.

What this means for claimants:  If you expend monies or provide other services on behalf of someone in exchange for their promise that you will be reimbursed via their Will or Trust, be sure to get that promise in writing.

You can read the entire opinion here.

Plaintiff rented out a condominium to his mother and the decedent, his mother’s husband. The couple paid the mortgage payment directly to the mortgage holder.  After plaintiff’s mother died, the decedent continued to live in the residence and pay the mortgage.  After the decedent passed away, the plaintiff filed a claim for unpaid back rent. The plaintiff claimed that he did not charge the couple full rental value during the decedent’s lifetime because of a promise that the outstanding balance would be paid back through a provision in the decedent’s will. In other words, he claimed that the decedent promised to leave the plaintiff something in his will. The Personal Representative filed a disallowance of the claim.   The plaintiff thereupon filed a complaint in the probate court on the theories of breach of contract, promissory estoppel, and quantum meruit (an equitable theory to receive remuneration on the basis of fairness).

The probate court dismissed the case on the basis that MCL 700.2514, which requires that contracts to make a will must be in writing,  barred the action.  The probate court raised this statute on its own.  The plaintiff claimed on appeal that it was error for the probate court to raise this statute on its own.  The plaintiff claimed that his case was an ordinary breach of contract action.  The Court of Appeals disagreed.  The Court of Appeals held that a party’s choice of labels for a cause of action is not dispositive.  A party cannot avoid the dismissal of a cause of action through “artful pleading.”  The Court of Appeals further held that MCL 700.2514 directly applied to this situation.  This statute provides that a contract to make a will, or to die without a will, must be in writing.  The Court of Appeals held that because the terms of the alleged contract in this case were to arise after death, it was clearly an agreement to make a will.  Since it was not in writing, it was unenforceable.  The trial court correctly dismissed the case.

What this means for claimants:  If you expend monies or provide other services on behalf of someone in exchange for their promise that you will be reimbursed via their Will or Trust, be sure to get that promise in writing.

You can read the entire opinion here.

Authored by Barbara A. Assendelft

The Decedent had a life insurance policy which named his mother as the beneficiary.  Subsequently the decedent met and dated his girlfriend. They eventually moved in together and had a baby girl together in 2003.  While his girlfriend was pregnant, they discussed decedent changing the beneficiary of the policy.  In 2005 decedent began having serious medical problems. In August 2006 he had surgery, but it was not successful and he was thereafter confined to a hospital bed.  After the surgery he was unable to speak but he could nod, move his lips, and gesture.   Then, one week before he died, decedent told his girlfriend that he wanted her and their daughter to share the life insurance proceeds equally, and instructed her to  fill out the appropriate  change forms, which she did.   The decedent signed the change of beneficiary forms at the hospital.  The girlfriend was not present when he signed them, but a hospital social worker and a notary were present.  They testified that the decedent could communicate, that he understood the document and that he intended to execute it.

            Decedent’s mother testified that on the way to the hospital before his surgery, decedent said he wanted her (the mother) to have his life insurance benefits.  

             After decedent died, there was a dispute between decedent’s mother and his girlfriend as to who should get the life insurance proceeds. The mother claimed that decedent’s changing the beneficiary was the result of undue influence on the part of the girlfriend.  The insurance company filed an interpleader action to get the court’s ruling on who was entitled to the proceeds.   The trial court ruled that the mother did not meet the burden of a presumption of undue influence.  The Court of Appeals reversed.  Upon remand, the trial court ruled that although the mother established the presumption, the girlfriend had successfully rebutted the presumption of undue influence.   Thus, the girlfriend was entitled to the proceeds.  The mother appealed.   The Court of Appeals affirmed, finding that the trial court did not err in finding that the presumption was rebutted.  

            Under the law, undue influence will presumed if evidence establishes the following three things: 1) the existence of a confidential relationship between the decedent and a fiduciary, i.e, the girlfriend; 2) the fiduciary benefits from the transaction; 3) the fiduciary had an opportunity to influence the grantor.   The party opposing the claim of undue influence then has the burden, by competent and credible evidence, of providing evidence to rebut the presumption.   The Court of Appeals held that although all three of the criteria for a presumption were met in this case, the girlfriend satisfactorily rebutted the presumption by the following evidence:  Decedent could communicate by moving his lips and gesturing.  He was medically cleared before signing the forms. The social worker and notary testified they believed he understood what he was doing.  The girlfriend was not present in the room when decedent signed the forms, and the only contra testimony indicating coercion was from the girlfriend’s sister, from whom she was estranged and whose testimony the trial court found not credible.   The Court of Appeals held that the trial court did not err in concluding that the girlfriend rebutted the presumption.  The Court of Appeals also held that the fact that the girlfriend’s testimony was self-serving did not change the conclusion, nor did the fact that the decedent was in a weakened and vulnerable physical state.

  What this means for beneficiaries:   A claim of undue influence can be made if a fiduciary to the decedent receives more from the estate than other heirs.  The girlfriend in this case was found to be a fiduciary because she was decedent’s appointed agent in his durable powers of attorney.  Fiduciaries are more vulnerable to a claim of undue influence because of the presumption mentioned in the case.   If you are a fiduciary (agent appointed in a durable power of attorney, executor, or trustee), you should take care not to take actions which could be construed as trying to exert influence on the decedent to leave more of his estate to you, especially if the grantor is elderly, frail, or in poor health.   Fortunately for the girlfriend in this case, there was enough evidence that the decedent was not unduly influenced so that the courts  denied the mother’s claim of undue influence and upheld the change in beneficiary.

You can read the entire opinion here.

Authored by Barbara A. Assendelft

            In 1984 Lyall and June Aldrich signed a quit claim deed that transferred ownership in some land to their three children, Kim Aldrich, Randy Aldrich, and Kit Price as tenants in common.   Randy Aldrich died without a Will in 1998.  No probate estate was opened at the probate court after his death.  In June 2001 Randy’s wife, Carol,  signed a deed transferring her interest in the property as survivor of her husband, to Randy’s brother, Kim Aldrich, and his sister, Kit Price.  After both Lyall and June died, Kim and Kit filed suit to quiet title in the property claiming they legally held all the interest.    Kim and Kit filed a motion for summary disposition, claiming that under the statute pertaining to intestate succession, MCL 700.2102 (1), Carol had interited  her husband’s entire estate, so that when she quitclaimed the property to Kim and Kit, she effectively transferred her husband’s one-third interest in the property to them.   Randy’s children, on the other hand, claimed that since Randy’s estate was not probated, Carol had never received a deed transferring the property to her and thus she could not transfer her interest to Kim and Kit. 

                The trial court ruled for Kim and Kit.  The trial court ruled that by executing the June 2001 quitclaim deed, Carol Aldrich in effect elected to take her survivor’s share in her husband’s estate.   The children appealed. The Court of Appeals affirmed.  The Court of Appeals noted that under Michigan law, title to real property vests in a decedent’s heirs at the moment of the decedent’s death, even if no probate estate is opened.  Hence, Carol received Randy’s 1/3 intere4st immediately when Randy died.  Thus, she could properly quit claim the 1/3 interest to Kim and Kit.   A quitclaim deed effectively transfers whatever interest in the property that the grantor had at the moment of the transfer. Because title to her husband/s one-third interest vested in her at the moment of her husband’s death, Carol Aldrich owned the one-third interest when she executed the quit claim deed.  Accordingly, there was nothing left for Randy’s children.

 

 What This Means For Heirs:

 If a person dies without a Will or Trust, a probate estate does not have to be opened at the probate court in order for legal title to real estate to pass to the decedent’s heirs.   However, be aware that this is not the rule for personal property.  The Court of Appeals specifically stated that title to personal property does not transfer to a decedent’s heirs at the moment of death; rather, it passes to the executor of the decedent’s estate upon appointment as executor by the probate court.  So, for all assets other than real estate, you should always have a probate estate opened in order to properly pass title to the heirs. 

You can view the entire Court of Appals opinion here.

Authored by Barbara A. Assendelft