Undue Influence: Definitions and Applications - California Courts ...

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guardians, real estate agents or brokers, lawyers, estate executors or administrators, and stockbrokers. Non-professionals may also have a fiduciary responsibility. Relatives or friends, for example, may serve as guardians, conservators, or trustees. “Reliant relationships” are ones in which the weaker parties rely on others for judgment or advice. An example is the doctor/patient relationship. In “dominant-subservient relationships” the weaker person is subservient to the dominant person. Persons likely to be in subservient relationships include those who are mentally or physically impaired. These categories are not mutually exclusive and there is potential for overlap among them. Family members and friends may also have an informal duty of trust and confidence toward weaker members. When undue influence has been alleged in contracts involving family and friends, courts have looked at whether the weaker parties were very old, mentally incapacitated, suffering from debilitating sicknesses, or otherwise physically or psychologically impaired. In general, family relationships between husbands and wives and between parents and children are considered confidential relationships (Nievod, 1992). In situations involving parties where there is no confidential or fiduciary relationship, courts may still determine that an individual has taken advantage of another’s weakness through the use of his or her own disproportionate strength. The courts have found that "disproportionate strength" may be based upon knowledge, experience, training, or relationship. Factors that contribute to the weaker parties’ weakness include diminished mental capacity, failing health, isolation, and/or distress. In these cases, courts also consider what benefits the powerful parties provided to the weaker (Frolik, 2001). Undue Influence in the Execution of Contracts and Wills Undue influence is among the most commonly asserted grounds for invalidating contracts, including wills, deeds, or trust instruments. It is addressed under a branch of law called “constructive fraud,” which covers situations in which someone is manipulated into doing something with legal consequences through the actions of others who have an unfair advantage. In these situations, courts may decide that the person is not exercising free and independent judgment and that the action should be treated as fraud even if all of the technical elements of fraud have not been proven. If undue influence is proved to have been exercised in 99
the signing of contracts, the contracts are voidable by the innocent party, and the remedy is rescission. In contract law, if a contract is obtained by undue influence, the document is invalid and no contract has been formed (Nievod, 1992). In determining whether contracts are the products of undue influence, courts consider: • Imbalances in power between signers and beneficiaries; • The circumstances in which the contracts were negotiated; • Specific actions taken; and • The inherent fairness or “naturalness” of transactions. Imbalances in power result from the nature of the relationship (is it a relationship of trust or confidence). Weaker parties may also be at a disadvantage as result of diminished capacity. Therefore, courts consider whether weaker persons were of full capacity at the time they signed documents, if they understood the facts and their rights, if they had time to reflect, and if they had independent advice (Nievod, 1992). In evaluating the results or products of the exchanges or transactions in question, courts attempt to determine if the transactions give an obvious advantage to the stronger parties. They may consider, for example, whether properties are sold at fair value, if employees are compensated at reasonable rates, and whether gifts are commensurate with the length and quality of relationships. They may also look at whether exchanges are “natural,” or what one would ordinarily expect. For example, courts may scrutinize wills that leave inheritances to new friends as opposed to family members. Approximately 3% of wills are challenged and 1% are found to be invalid (Mohr, 1997). A survey of will contestations showed that wills are likely to be contested when decedents have no biological children (this is true in 52% of will contests) and when the will was written less than one year prior to the testators death (this accounts for 48% of contests) (Hall, Hall, Myers, & Chapman, 2009). There are two primary reasons that wills are contested. The first is dramatic or “radical” changes from previous wills or inconsistently expressed wishes of the testators. This factor accounts for 72% of contested wills. 100
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UNDUE INFLUENCE: DEFINITIONS AND AP
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Claims of undue influence can be di
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probate courts. They encounter it a
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4. Focus groups with San Francisco
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More recent law is contained in Cal
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searching bibliographic databases a
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submissiveness to point that victim
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Elements of Undue Influence Describ
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Category I Category II Category III
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Category I Category II Category III
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Focus Groups To gain greater insigh
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for love, emotional attachment, or
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who would deliver the money.’’
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esidence (as opposed to, for exampl
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percent), followed by a change in a
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escinding the sale of the house. Ri
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Capacity Declaration Form The menta
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Case Examples Case Five A 75-year-o
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to undue influence and to more reli
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Project staff have been invited to
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APPENDIX A REPORTS OF CASES DECIDED
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The facts upon which the allegation
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APPENDIX B A STATUTORY DEFINITION O
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whether undue influence has taken p
Page 49 and 50: etween the testator and the influen
Page 51 and 52: guardian/ward, physician or nurse/p
Page 53 and 54: undue influence reduced from the ca
Page 55 and 56: said at times that she was afraid o
Page 57 and 58: According to Dr. Spar, the common r
Page 59 and 60: disposition to exert undue influenc
Page 61 and 62: her overall mental and physical wea
Page 63 and 64: Familial relationships are frequent
Page 65 and 66: This presumption of undue influence
Page 67 and 68: element (4) requires a disposition
Page 69 and 70: intentions of testator). However, w
Page 71 and 72: APPENDIX C Literature Review on Und
Page 73 and 74: 7. How professionals exploit relati
Page 75 and 76: that can be brought to bear in doin
Page 77 and 78: professionals who became controvers
Page 79 and 80: • Hostage takers threaten to kill
Page 81 and 82: Walker identified four general char
Page 83 and 84: of anxiety, avoidance behavior and
Page 85 and 86: and Vicary later retracted some of
Page 87 and 88: protecting themselves against manip
Page 89 and 90: not exhibit Stockholm syndrome, law
Page 91 and 92: financial gain. Others have focused
Page 93 and 94: esult or outcome of the undue influ
Page 95 and 96: Association, 2008). Naimark (2001)
Page 97 and 98: 2. Power Differentials Undue influe
Page 99: goes back even further. Abraham Nie
Page 103 and 104: to the accused to show that there w
Page 105 and 106: The authors note that courts tend t
Page 107 and 108: ing a claim that the church had use
Page 109 and 110: 8. An elder’s will, living will,
Page 111 and 112: covered under the prohibited transf
Page 113 and 114: ecovery of damages, attorneys’ fe
Page 115 and 116: As noted earlier in this literature
Page 117 and 118: witnesses with respect to the impor
Page 119 and 120: Donohue, W. A. (1985). The politics
Page 121 and 122: Naimark, D. (2001). Financial explo
Page 123 and 124: Rusch, J. J. (1999). The social eng
Page 125 and 126: APPENDIX D Capacity Declaration For
Page 127 and 128: CONSERVATORSHIP OF THE PERSON ESTAT
Page 129 and 130: APPENDIX E Court File Review - Deta
Page 131 and 132: Table 8. Age of proposed conservate
Page 133 and 134: Table 12. Proposed conservatee’s
Page 135 and 136: Table 16. Other traits of alleged a
Page 137 and 138: Table 21. How long has the alleged
Page 139 and 140: Table 24. Other elements/characteri
Page 141 and 142: Borchard grant file review 1. Case
Page 143 and 144: Borchard grant file review 12. Tact
Page 145 and 146: Borchard grant file review 20. Does
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