Estate of Campbell

1997 ME 212, 704 A.2d 329, 1997 Me. LEXIS 216
CourtSupreme Judicial Court of Maine
DecidedNovember 4, 1997
StatusPublished
Cited by19 cases

This text of 1997 ME 212 (Estate of Campbell) is published on Counsel Stack Legal Research, covering Supreme Judicial Court of Maine primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Estate of Campbell, 1997 ME 212, 704 A.2d 329, 1997 Me. LEXIS 216 (Me. 1997).

Opinion

DANA, Justice.

[¶ 1] John Campbell, a son of Mary Campbell, appeals from the judgment of the York County Probate Court (Nadeau, J.) ordering him to hold two parcels of real estate in a constructive trust for the benefit of Mary’s estate. John contends that the court erred by finding that he abused a fiduciary or confidential relationship so as to give rise to a constructive trust and maintains that he owns one of the two parcels outright based on a deed signed by the then owner after his mother’s death. John’s brother, Joseph Campbell, the personal representative of Mary’s estate, cross-appeals from that part of the Probate Court’s amended decision that found no constructive fraud. Because the evidence supports the Probate Court’s finding of an abuse of a confidential relationship, we affirm the judgment.

[¶ 2] In 1987 Mary transferred her interest in two cottage properties located in York to her son, John. At the time of the conveyances, Mary was 85 years old, in failing health, and living in a nursing care facility in Massachusetts. Because Mary’s liquid assets were almost depleted, John made inquiries of Massachusetts officials regarding how Mary could qualify for Medicaid assistance. On the advice of Massachusetts Medicaid authorities and his own attorney, John arranged for Mary to transfer her two Maine cottages into his name, thereby removing them from the assets considered for Mary’s Medicaid eligibility. Although John had undertaken the responsibility of making arrangements for Mary’s care with the consent of his siblings, he did not inform any of them about these transfers until after their mother’s death.

[¶3] Mary died intestate in 1990, and shortly thereafter a dispute arose among her children over the proper disposition of the two York properties. Joseph was appointed personal representative of his mother’s estate and filed a complaint against John seeking a constructive trust over the York properties for the benefit of the estate on the grounds of breach of a fiduciary duty, fraud, misrepresentation, and undue influence. Following a testimonial hearing in March 1994, the York County Probate Court (Brooks, J), relying on the Improvident Transfers of Title Act, 33 M.R.S.A §§ 1021-25 (Supp.1996), imposed a constructive trust on both properties. John appealed, and, without deciding whether a cause of action under the Act survives the death of the transferor, we vacated the judgment because the Act applies only to transfers made after August 4, 1988 and the conveyances at issue here occurred in 1987. Estate of Campbell, 651 A. 2d 382, 384 (Me.1994).

[¶ 4] On remand, and after further hearing, the court again declared that John must hold the properties in a constructive trust for the estate of Mary. The court found for Joseph on the abuse of the confidential relationship count and the constructive fraud count and found for John on the misrepresentation and undue influence counts. After John moved to alter or amend the judgment pursuant to M.R. Prob. P. 59, a newly elected probate judge (Nadeau, J.) vacated the prior judge’s finding supporting the constructive fraud count. The court upheld the imposition of a constructive trust, however, finding sufficient evidence of John’s abuse of a confidential relationship. This appeal and cross-appeal followed. 1

[¶ 5] “[A] constructive trust may be imposed to do equity and to prevent unjust *331 enrichment when title to property is acquired by fraud, duress, or undue influence, or is acquired or retained in violation of a fiduciary duty.” Gaulin v. Jones, 481 A.2d 166, 168 (Me.1984) (citing Chandler v. Dubey, 325 A.2d 6, 8 (Me.1974)). The modern rule, unlike the traditional view, does not require a party seeking a constructive trust to show affirmative wrongdoing. See Horton & McGehee, Maine Civil Remedies § 9-3, at 221 (2d ed.1996). “[T]he constructive trust arises by operation of equity without regard to the parties’ intentions. Its objective is to prevent unjust enrichment.” Id. § 9-2, at 220.

[¶ 6] The existence of a confidential relationship is a question of fact. Ruebsamen v. Maddocks, 340 A.2d 31, 35 (Me.1975). Issues of fact are reviewed for clear error. M.R. Civ. P. 52(a); VanVoorhees v. Dodge, 679 A.2d 1077, 1080 (Me.1996). “A trial court’s factual finding is ‘clearly erroneous’ if there is no competent evidence in the record to support it.” Id.

[¶ 7] John contends that the court committed an error of law in holding that he retained title to the York properties in violation of a fiduciary duty. John, relying on Gaulin v. Jones, 481 A.2d 166 (Me.1984), argues that no constructive trust may be imposed in this case without clear and convincing evidence of an agreement between Mary and John that John would hold the property for the benefit of the other family members. Joseph maintains that although such a standard of proof is required to show constructive fraud under some circumstances, the court’s finding of a breach of a fiduciary or confidential relationship does not require such a showing.

[¶ 8] Although in Gaulin we spoke in terms of a “resulting fiduciary relationship” arising out of an agreement by one party to hold property for another, the term was used in that case in the context of describing the elements of constructive fraud. Gaulin, 481 A.2d at 169. The elements of a claim for a constructive trust on the independent basis of an abuse of a confidential relationship are found in Ruebsamen v. Maddocks, 340 A.2d 31, 35 (Me.1975). In Ruebsamen, we established the procedural steps necessary before imposing a constructive trust based on an abuse of a fiduciary or confidential relationship: The party seeking the imposition of the trust must first establish by a preponderance of the evidence the existence of a confidential relationship between the grantor and the grantee. Id. at 34.

The salient elements of a confidential relation are the actual placing of trust and confidence in fact by one party in another and a great disparity of position and influence between the parties to the relation. That the parties are related by blood or marriage may lead a court to find that a confidential relation exists, where there is evidence as to trusting and where the blood or family relationship is in a close degree so that the imposition of great trust and the letting down of all guards and bars is natural.

Id. at 35. The burden then shifts to the benefited party to show the fairness of the transaction. Id. at 36-37.

[¶ 9] The court was justified in finding the following facts regarding the existence of a confidential relationship and its abuse: At the time of the 1987 conveyances Mary was 85 years old and in failing health.

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Bluebook (online)
1997 ME 212, 704 A.2d 329, 1997 Me. LEXIS 216, Counsel Stack Legal Research, https://law.counselstack.com/opinion/estate-of-campbell-me-1997.