In re Estate of: Alice I. Engman, Decedent.

• Court: Court of Appeals of Minnesota
• Decided: January 30, 2017
• Docket: A16-805
• Status: Unpublished

Opinion

This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2016).

STATE OF MINNESOTA IN COURT OF APPEALS A16-0805

In re Estate of: Alice I. Engman, Decedent.

Filed January 30, 2017 Affirmed Johnson, Judge

St. Louis County District Court File No. 69DU-PR-15-54

James W. Balmer, Falsani, Balmer, Peterson & Quinn, Duluth, Minnesota (for appellant Dean Korach)

Michael E. Orman, Orman Nord & Hurd, P.L.L.P., Duluth, Minnesota (for respondents Lois LeBlanc and Karon Engman)

Considered and decided by Reyes, Presiding Judge; Tracy M. Smith, Judge; and

Johnson, Judge.

UNPUBLISHED OPINION

JOHNSON, Judge

The primary issue in this case is whether an elderly woman’s daughter or daughter-

in-law exerted undue influence over her when she executed a will that excluded another

daughter who had been included in an earlier will. We conclude that the district court did

not err by determining, on a motion for summary judgment, that the latest will is valid. We

also conclude that the district court did not err by denying a motion for sanctions.

Therefore, we affirm. FACTS

This appeal concerns the estate of Alice Engman, who died in 2013 at the age of 99.

She had three children from her marriage to John Engman: Bernice Korach, Lois LeBlanc,

and Jack Engman. When Alice and John were divorced in 1962, Alice was awarded five

parcels of rural property in Duluth on Munger Shaw Road. She sold the three western

parcels and conveyed an eastern parcel to her son, Jack, and his wife, Karon Engman, who

established their residence there. Alice moved into a trailer home on the other eastern

parcel, where she lived for nearly 50 years. In the last stages of her life, that 36-acre parcel

of property was her only significant asset.

Jack died in 1993. After his death, Alice and Karon had a joint bank account, which

Karon used to pay Alice’s bills. In 2010, Alice slipped and fell in her home, which

prompted her to move in with Lois, her daughter. A year later, Alice moved into the

Carefree Living assisted-living facility in Silver Bay. Lois visited Alice at Carefree Living

nearly every day. Alice granted Lois a power of attorney, and Lois paid Alice’s bills out

of the joint checking account that Alice shared with Karon.

Alice executed three wills during her lifetime, all of which were drafted by the same

attorney. Her first will, dated March 11, 2008, would have bequeathed her property in

three equal shares to Bernice and Lois (her two daughters) and Karon (her daughter-in-law,

who had survived her son Jack). Her first will specified that a grandson, Dean Korach, one

of Bernice’s four children, would serve as personal representative of the estate, for which

he would have received a gift of $2,000.

2 Shortly after Alice executed her first will, Dean expressed his preference to not serve

as personal representative. Accordingly, Alice executed a second will on July 9, 2008,

which specified that a different grandson, Guy LeBlanc, a child of Lois, would serve as

personal representative of the estate. Her second will also would have bequeathed her

property in three equal shares to Bernice, Lois, and Karon, and it provided that if any of

the three beneficiaries were to predecease Alice, that beneficiary’s children would inherit

their mother’s share.

In May 2012, Alice contacted her attorney for the purpose of making another change

to her will. Alice met with her attorney at Carefree Living. The attorney testified in

deposition that Alice told him that she did not want to leave any property to Bernice

because Bernice was ill and was applying for medical assistance and that she did not want

one-third of her estate to be subject to a medical-assistance lien. In addition, Alice told the

attorney that she was upset with Bernice’s children because they had attempted to pressure

her into selling her real property to them for less than what it was worth. The attorney

testified that he prepared a new will in accordance with Alice’s wishes.

Alice executed the third will on June 1, 2012, at Carefree Living. The third will was

different from the second will in that it bequeathed Alice’s property to only Lois and Karon

and specifically excluded Bernice and her children. Two employees of Carefree Living

testified in depositions that their supervisor asked them to serve as witnesses to Alice’s

execution of the will, that Alice appeared to be competent, and that Lois was not in the

room when Alice executed the documents.

3 Bernice died in October 2012. Alice died in January 2013. Approximately two

years later, in March 2015, Dean filed a petition for formal adjudication of intestacy. In

April 2015, Lois and Karon moved for summary judgment, arguing that Alice’s June 2012

will conclusively establishes that she did not die intestate. In May 2015, Lois and Karon

moved for sanctions on the ground that Dean petitioned for an adjudication of intestacy

despite knowing that Alice had executed a will. In July 2015, the district court denied Lois

and Karon’s motion for summary judgment on the ground that Dean may attempt to prove

his claims of lack of capacity and undue influence. At the same time, the district court

denied Lois and Karon’s motion for sanctions. In February 2016, Lois and Karon again

moved for summary judgment, arguing that there is insufficient evidence to support Dean’s

allegations that Alice lacked testamentary capacity or that Lois or Karon exerted undue

influence on Alice. In April 2016, the district court agreed with Lois and Karon’s argument

and granted their second motion for summary judgment.

Dean seeks review of the district court’s grant of the second summary-judgment

motion by way of a notice of appeal. Lois and Karon seek review of the district court’s

denial of the sanctions motion by way of a notice of related appeal.

DECISION

I. Undue Influence

Dean argues that the district court erred by granting Lois and Karon’s second motion

for summary judgment.

A district court must grant a motion for summary judgment if the “pleadings,

depositions, answers to interrogatories, and admissions on file, together with the affidavits,

4 if any, show that there is no genuine issue as to any material fact and that either party is

entitled to a judgment as a matter of law.” Minn. R. Civ. P. 56.03. A genuine issue of

material fact exists if a rational trier of fact, considering the record as a whole, could find

for the nonmoving party. Frieler v. Carlson Mktg. Grp., 751 N.W.2d 558, 564 (Minn.

2008). This court applies a de novo standard of review to the district court’s legal

conclusions on summary judgment and “view[s] the evidence in the light most favorable

to the party against whom summary judgment was granted.” Commerce Bank v. West Bend

Mut. Ins. Co., 870 N.W.2d 770, 773 (Minn. 2015).

Undue influence is “influence of such a degree exerted upon the testator by another

that it destroys or overcomes the testator’s free agency and substitutes the will of the person

exercising the influence for that of the testator.” In re Wilson’s Estate, 223 Minn. 409,

413, 27 N.W.2d 429, 432 (1947). A party seeking to prove undue influence must prove

that the influence “was so dominant and controlling of the testator’s mind that, in making

the will, [she] ceased to act of [her] own free volition and became a mere puppet of the

wielder of that influence.” In re Reay’s Estate, 249 Minn. 123, 126-27, 81 N.W.2d 277,

280 (1957). “Evidence which raises merely a suspicion and shows no more than a motive

for exerting and an opportunity to exert undue influence is insufficient proof thereof,

though coupled with proof of inequality in the terms of the will.” In re Mardsen’s Estate,

217 Minn. 1, 10, 13 N.W.2d 765, 770 (1944). Undue influence may be proved by either

direct evidence or circumstantial evidence. Agner v. Bourn, 281 Minn. 385, 392, 161

N.W.2d 813, 818 (1968). The supreme court has identified several forms of circumstantial

evidence that may be introduced to prove undue influence:

5 the opportunity to exercise it, active participation in the preparation of the will by the party exercising it, a confidential relationship between the person making the will and the party exercising the influence, disinheritance of those whom the decedent probably would have remembered in his will, singularity of the provisions of the will, and the exercise of influence or persuasion to induce him to make the will in question.

Wilson’s Estate, 223 Minn. at 413, 27 N.W.2d at 432.

In this case, the district court analyzed the parties’ arguments by discussing each of

the forms of circumstantial evidence identified in Wilson’s Estate. Specifically, the district

court reasoned that the evidence in the summary-judgment record, when viewed in the light

most favorable to Dean, shows that Lois and Karon had an opportunity to exercise

influence over Alice and that the provisions in Alice’s will were singular in that they

“significantly and uniquely change[d] the disposition of Decedent’s estate.” But the district

court also reasoned that the evidence in the summary-judgment record did not show that

Lois or Karon actively participated in preparing the will, that they had a confidential

relationship with Alice, that Bernice or her children would have inherited property from

Alice in the absence of undue influence, or that Lois or Karon actually exercised influence

or persuasion over Alice in her making of the third will. The district court concluded that

Dean did not produce sufficient evidence to create a genuine issue of material fact as to

whether Lois or Karon exercised undue influence over Alice when Alice executed her third

will.

Dean makes three specific arguments for reversal.

6 A.

Dean argues that the district court erred by considering the deposition testimony of

the attorney who assisted Alice with her third will. He contends that the attorney’s

testimony is not credible because the attorney recently was disciplined for professional

misconduct, including the making of a knowingly false statement to a court.

The district court considered and rejected this argument, which Dean did not include

in his motion papers but presented to the district court orally at the summary-judgment

hearing. In its order, the district court questioned whether Dean would be allowed to

introduce extrinsic evidence of the attorney’s lack of credibility. See Minn. R. Evid.

608(b). The district court also noted the absence of caselaw stating that the attorney’s

testimony could not be considered in any way. And the district court noted that the

attorney’s testimony was corroborated by other evidence. We note that Dean did not

attempt to attack the credibility of Alice’s attorney when deposing him, which means that

the summary-judgment record contained no impeachment evidence. We also note that

Dean did not introduce any evidence that directly contradicts the attorney’s testimony.

For all of these reasons, the district court did not err by considering the deposition

testimony of Alice’s attorney.

B.

Dean argues that the district court misanalyzed the question whether there was “a

confidential relationship between the person making the will and the party exercising the

influence.” See Wilson’s Estate, 223 Minn. at 413, 27 N.W.2d at 432. Dean further argues

that, if his evidence of a confidential relationship is recognized, he will have established a

7 majority of the relevant factors, which he contends would warrant a trial or a judgment in

his favor.

Dean’s second argument is based on the mistaken premise that the various forms of

circumstantial evidence identified in Wilson’s Estate constitute a multi-factor balancing

test that requires consideration of each factor in every case and whose result depends on

the number of factors implicated and the weight of the evidence supporting each factor.

The district court’s analysis appears to be based on the same premise because the district

court’s order discusses each of the items identified in Wilson’s Estate, regardless of

whether Dean offered such evidence. The district court may have performed such an

analysis because the supreme court has referred to the various forms of circumstantial

evidence as “factors,” see id., and because this court subsequently has summarized the

applicable law in a manner that could be read to suggest a multi-factor balancing test, see

In re Estate of Opsahl, 448 N.W.2d 96, 100 (Minn. App. 1989); In re Estate of Ristau, 399

N.W.2d 101, 104 (Minn. App. 1987); In re Estate of Olsen, 357 N.W.2d 407, 411-12

(Minn. App. 1984), review denied (Minn. Feb. 27, 1985). We read Wilson’s Estate to say

that there are various ways in which a party might prove undue influence, depending on

the facts of a particular case, and that a party seeking to prove undue influence may choose

to introduce, among other things, any of the forms of circumstantial evidence identified in

that opinion. See Wilson’s Estate, 223 Minn. at 413, 27 N.W.2d at 432.

With that understanding, we consider Dean’s evidence of a confidential

relationship. He points to evidence that Karon paid Alice’s bills using a joint checking

account and evidence that Alice granted Lois a power of attorney. The district court

8 accepted that evidence as true but said that it did not go “beyond what could be expected

in a close relationship between a mother and daughter or mother and daughter-in-law.”

The district court also reasoned that “there is no evidence that either woman abused their

responsibilities, or that [Alice] was sufficiently dependent on either woman as to suggest

she was controlled by them.” For those reasons, the district court concluded that “there is

insufficient evidence to support an inference that a confidential relationship existed”

between Alice and Karon or Lois.

A confidential relationship may exist if an elderly person relies on the assistance of

another person in business and financial matters. See, e.g., Norlander v. Cronk, 300 Minn.

471, 475, 221 N.W.2d 108, 111 (1974). The existence of a confidential relationship may

suggest that a confidante has exerted undue influence. See Marsden’s Estate, 217 Minn.

at 11-12, 13 N.W.2d at 771. But the mere existence of a confidential relationship does not

necessarily imply the exercise of undue influence. See Wilson’s Estate, 223 Minn. at 413,

27 N.W.2d at 432. Indeed, if a confidential relationship exists between relatives, this fact

tends to negate, rather than prove, undue influence. Marsden’s Estate, 217 Minn. at 11-

12, 13 N.W.2d at 771; In re Estate of Larson, 394 N.W.2d 617, 619 (Minn. App. 1986),

review denied (Minn. Dec. 12, 1986); In re Estate of Anderson, 379 N.W.2d 197, 201

(Minn. App. 1985), review denied (Minn. Feb. 19, 1986). Accordingly, the evidence that

Lois and Karon assisted Alice in financial matters is evidence of a confidential relationship,

but that evidence is not, in itself, determinative of the question whether Karon or Lois

unduly influenced Alice to execute the third will. See Wilson’s Estate, 223 Minn. at 413,

9 27 N.W.2d at 432. Whether the evidence is capable of proving undue influence in

combination with other evidence is a question that we consider below.

Thus, the district court did not commit reversible error in analyzing whether Dean

introduced evidence of a confidential relationship between Alice and Karon or Lois.

C.

Dean argues that the district court erred by not recognizing that the reasonable

inferences from his evidence are capable of proving that Karon or Lois exercised undue

influence over Alice.

To prevail on a claim of undue influence, Dean must have “evidence that undue

influence was in fact exerted.” See Reay’s Estate, 249 Minn. at 126-27, 81 N.W.2d at 280

(emphasis added). Moreover, the evidence must show “not only that the influence was in

fact exerted, but that it was so dominant and controlling of the testator’s mind that, in

making the will, he ceased to act of his own free volition and became a mere puppet of the

wielder of that influence.” Id. “Evidence which raises merely a suspicion and shows no

more than . . . an opportunity to exert undue influence is insufficient . . . .” Marsden’s

Estate, 217 Minn. at 10, 13 N.W.2d at 770.

Dean’s circumstantial evidence is insufficient to create a genuine issue of material

fact. In his deposition, he did not disclose any evidence that Karon or Lois actually

influenced Alice to execute the third will. Dean suspects Lois of having done so, but he

has nothing more than suspicion, which is insufficient by itself. See id. Likewise, Dean’s

siblings are unaware of any facts that would suggest that Karon or Lois exercised undue

10 influence over Alice. Lois and Karon denied any involvement in the preparation or

execution of the third will, and Dean has no evidence to contradict their testimony.

Furthermore, the evidentiary record contains evidence that Alice had affirmative

reasons for executing her third will. As her attorney testified in deposition, Alice wanted

to avoid a situation in which the property she left to Bernice would be subject to a medical-

assistance lien, and Alice was upset with Bernice’s children because they had attempted to

pressure her into selling her property to them for less than it was worth. The evidentiary

record corroborates both of these reasons. The record shows that Bernice was in declining

health and on medical assistance in May 2012 and that she died in October 2012, three

months before Alice died. The record also contains two letters that Dean wrote to Alice in

March 2012 concerning Dean’s interest in purchasing Alice’s real property, and both letters

reveal that the matter was somewhat contentious and had created friction between them.

In addition, Dean’s sister Becky Korach stated in her deposition that Alice was “fiercely

independent,” which tends to suggest that she would decide for herself whether to execute

the third will. In short, Dean’s undue-influence argument is based solely on speculation,

but “mere speculation, without some concrete evidence, is not enough to avoid summary

judgment.” Osborne v. Twin Town Bowl, Inc., 749 N.W.2d 367, 371 (Minn. 2008)

(quotation omitted).

Thus, the district court did not err by granting Lois and Karon’s motion for summary

judgment.

11 II. Sanctions

Lois and Karon argue that the district court erred by denying their motion for

sanctions. They contend that sanctions are appropriate because Dean and his attorney filed

a petition for a formal adjudication of intestacy despite knowing that Alice had executed a

Lois and Karon sought sanctions under rule 11 of the Minnesota Rules of Civil

Procedure and section 549.211 of the Minnesota Statutes. Under the rule, whenever an

attorney files a pleading, motion, or other paper with the court, the attorney is “certifying

that to the best of [his] knowledge, information, and belief, formed after an inquiry

reasonable under the circumstances, . . . the allegations and other factual contentions have

evidentiary support or . . . are likely to have evidentiary support after a reasonable

opportunity for further investigation or discovery.” Minn. R. Civ. P. 11.02. An objective

standard of reasonableness applies. Uselman v. Uselman, 464 N.W.2d 130, 142-43 (Minn.

1990). A similar standard is imposed by the statute. See Minn. Stat. § 549.211 (2016). If

an attorney violates the rule or the statute, a district court has discretion to impose

sanctions. Kalenburg v. Klein, 847 N.W.2d 34, 41-42 (Minn. App. 2014). This court

applies an abuse-of-discretion standard of review to a district court’s decision whether to

impose sanctions. In re Progressive Ins. Co., 720 N.W.2d 865, 874 (Minn. App. 2006),

review denied (Minn. Nov. 22, 2006).

In this case, the district court ruled on the motion for sanctions shortly after the case

was commenced and approximately nine months before granting Lois and Karon’s second

motion for summary judgment. The district court determined that sanctions were

12 inappropriate because Dean and his attorney were unaware of the June 2012 will when they

commenced this action and because Dean’s attorney consulted with an attorney with more

experience in probate matters, who advised that the petition that was filed would be an

appropriate way to seek relief on the ground that the third will was invalid. The district

court also reasoned that, even if Dean’s petition did not reflect the best form of pleading,

it would effectively prompt a resolution of the parties’ dispute.

We acknowledge some uncertainty in the record as to whether the district court was

correct in stating that Dean and his attorney were unaware of the June 2012 will when they

commenced this action. We also note that Dean was undoubtedly aware of Alice’s first

will, which named him as personal representative, which caused him to request that she

put those responsibilities on someone else, which she did in her second will. Nonetheless,

the district court’s decision appears to be based primarily on Dean’s attorney’s reliance on

another lawyer with expertise in probate law and on the observation that Lois and Karon

were not prejudiced by the form and content of Dean’s pleading. The district court did not

abuse its discretion by declining to impose sanctions for those reasons.

Affirmed.