Alleged Delusions Did Not Invalidate Trust In Favor Of St. Jude’s For Lack Of Testamentary Capacity

In Eyford v. Nord, a March 2021 opinion, the California Court of Appeal, First Appellate District, affirmed a California probate court’s judgment denying a petition filed by two granddaughters to invalidate their grandmother’s trust on the ground of delusions that negated her testamentary capacity, which disinherited them in favor of St. Jude Children’s Research Hospital.  The facts are long, but they give great insight into what facts might be enough (or not) to rise to the level of delusion that results in testamentary incapacity under California law.

The Facts of Eyford v. Nord

Catherine “Kay” Pearson had two children, Cathy and John, with her first husband, John Sr.  After Kay and John divorced, Kay married Bob Pearson.  Kay became estranged from her son after the divorce, but remained close with Cathy.  Cathy had two daughters, Shannon Eyford and Erin Johnson.  Cathy died in 2014 from cancer.

Around the time of Cathy’s death, Kay told numerous people that her estate was going to her granddaughters.  Kay also told her longtime friends that her granddaughters had caused Cathy’s death by repositioning her in bed the night of her surgery against a doctor’s orders.

In August 2014 Kay and Bob moved to a senior living facility in Napa.  Kay stayed in independent living at the facility until her death.  Bob died on October 1, 2015.  Within weeks after Bob’s death, Kay called John Sr. (her ex-husband whom she had remained close with) and said she was confused and alone. She also said that she did not know what she was doing and that Bob had taken care of everything.

Kay was admitted to the hospital in October 2015 with confusion secondary to a UTI.  The confusion cleared up in the hospital. When Kay was discharged and returned to independent living, John Sr. and Johnson helped her go through her finances.  They found documentation of an account worth $2.4 million.

On October 26, 2015, Eyford took Kay for cognitive testing. Eyford testified that the hospital had scheduled the appointment because the senior living facility required an evaluation to determine if Kay needed changes to her living arrangements. At the clinic, Kay underwent a “mini mental status exam” which indicated she was experiencing mild to moderate cognitive impairment.

On October 27, 2015, Eyford, Johnson, John Sr., and Kay went to Kay’s bank, and Kay put appellants on her account so they could help with her banking. Kay also signed a will and a power of attorney that appellants obtained from the internet. The notarized power of attorney form named Eyford as Kay’s attorney-in-fact, giving her power to make financial decisions for Kay, and it named Johnson the successor attorney-in-fact. The will Kay signed named Eyford and Johnson as Kay’s sole beneficiaries. Concerned about the validity of that will, John Sr. advised Kay to consult an attorney.

On October 28, 2015, John Sr. and Johnson left town.  Eyford stayed and took Kay to an estate planning attorney, Watson, for the purpose of preparing a trust leaving everything to Eyford and Johnson.  Watson planned to have the trust ready for signing by November 9, 2015.  Eyford and Kay argued about Kay’s ability to continue to drive, and Kay became very upset with Eyford.  The next morning, Kay did not remember accusing Eyford of trying to take away her independence, and confirmed her intention to keep the estate in the family.

The February 2016 Trust

Kay went back to see Watson several times concerning executing the trust.  Watson felt uncomfortable that Kay was accompanied by different people every time she came to see him, and requested a capacity declaration before documents were signed.  Kay dismissed Watson after a meeting in December 2015.

Kay then retained another attorney, Lori Hunt.  Before seeing Hunt, Kay told her accountant, Joan Sturges, that she wanted her estate to go to “sick babies.”  On February 10, 2016, Hunt met with Kay and suggested St. Jude as a potential beneficiary; Kay loved the idea. When asked why she was disinheriting appellants, Kay replied that she felt she and Bob had given them enough through the years, that what she had was attributable to Bob, and that Bob loved helping sick babies, so she wanted to leave her estate to a charity that benefited sick babies to honor him. On February 24, 2016, Kay signed a trust that named St. Jude as her sole beneficiary and expressly disinherited her son and appellants.

Kay died in December 2016.

Petition Contesting the Validity Of the Trust

The granddaughters filed a petition contesting the validity of the trust on the ground that Kay had a mental disorder with symptoms including delusions or hallucinations that allegedly caused Kay to devise her property in a way she would not otherwise have done.  The petition was filed under § 6100.5(a)(2) of the California Probate Code.  Jim Nord, trustee of the trust, and St. Jude were named as respondents.

The California probate court upheld the validity of the trust, and the granddaughters appealed the judgment.

Do Delusions Negate Testamentary Capacity Under California Law?

Delusions that result in an individual devising property in a way that, except for the existence of the delusions, the individual would not have done, can result in a lack of testamentary capacity to make a will or trust under California law.  The presumption under California law is always that a person is sane, and the burden is always upon the contestants of the will or trust to show affirmatively, and by a preponderance of the evidence, that the testatrix was of unsound mind at the time of the execution of the will or trust.

“As a general proposition, California law allows a testator to dispose of property as he or she sees fit without regard to whether the dispositions specified are appropriate or fair. Testamentary competence is presumed.” (Estate of Sarabia (1990) 221 Cal.App.3d 599, 604, italics added.)

California Probate Code Section 6100.5(a)(2) provides that “[a]n individual is not mentally competent to make a will if, at the time of making the will, . . . [¶] . . . [¶] . . . [t]he individual suffers from a mental health disorder with symptoms including delusions or hallucinations, which delusions or hallucinations result in the individual’s devising property in a way that, except for the existence of the delusions or hallucinations, the individual would not have done.”

What Is a Delusion For Purposes of Testamentary Capacity Under California Law?

A delusion “has been defined to be the conception of a disordered mind which imagines facts to exist of which there is no evidence and the belief in which is adhered to against all evidence and argument to the contrary, and which cannot be accounted for on any reasonable hypothesis. ‘One cannot be said to act under an insane delusion if his condition of mind results from a belief or inference, however irrational or unfounded, drawn from facts which are shown to exist.’ ” (Estate of Putnam (1934) 1 Cal.2d 162, 172.)

“If there is any evidence, however slight or inconclusive, which might have a tendency to create a belief, such belief is not a delusion.” (Estate of Alegria (1948) 87 Cal.App.2d 645, 655.) “Capricious and arbitrary likes, dislikes and mistrusts are not evidence of unsoundness of mind.” (Ibid.) “Care must be taken to differentiate between mere unreasonable opinions and mental derangements. Testamentary capacity does not depend upon the testatrix’ ability to reason logically or upon her freedom from prejudice. A belief may be illogical or preposterous, but it is not, therefore, evidence of insanity.” (In re Estate of Perkins (1925) 195 Cal. 699, 708 (Perkins).)

The Evidence of Delusions At Trial – Kay’s Accusations Against Her Granddaughters and State of Mind

A mass of evidence was presented at trial, including testimony of the parties, experts, Kay’s friends, the drafting attorneys, and Kay’s accountant.  The evidence at trial included:

  • Kay believed that Eyford was trying to sell her car and had keys to her apartment, threatening to come in.
  • Kay stated she was afraid of Eyford.
  • Kay said that Eyford and Johnson were interested only in her money, that they were trying to say she had cognitive issues and could not handle her own affairs, and that Kay did not want to associate with Eyford.
  • Kay stated that Eyford was still in Napa staying with her, despite being at home in Washington State.
  • Kay called Eyford a “floozy,” and said Eyford was no longer welcome at her living facility because Kay did not feel safe and Eyford stole money and a bracelet from her.
  • During their final phone conversation, Kay accused Johnson of being in “cahoots” with Eyford and cut off contact with her as well.
  • Kay was afraid of “everything.” She would not allow handymen into her home and was afraid of appellants being in town.
  • Sturges, Kay’s long-term accountant, testified that Kay had good days and bad days, and that the day that Kay signed the subject trust was a good day, that Kay was clear headed and Sturges believed that Kay knew what she was doing.
  • Kay talked poorly about Eyford and Johnson to her friends.
  • Kay’s internist testified that she never noticed Kay exhibit delusions or paranoia, and that she never formed any concern that Kay might have dementia.
  • Kay’s hematologist/oncologist, also never noticed any cognitive decline or delirium in Kay.
  • The parties presented competing expert testimony concerning Kay’s mental condition.

 

 

What Is The Standard Of Review Under California Law When There Is Disputed Evidence Of Testamentary Capacity?

Where the trial court’s “ruling that is the subject of appeal turns on the trial court’s determination of disputed facts, the appropriate standard of review on appeal is “sufficiency of the evidence.”

As to the standard of review, the California Appeals Court stated:

There appears no doubt that the relevant facts concerning Kay’s mental state and mental condition were in dispute, and the parties presented conflicting evidence over the course of trial. For example, witnesses Hunt, Steele, McCully, and Barrios testified that Kay never appeared disoriented or confused or to be having mental trouble in 2016, while witnesses Sturges and John Sr. testified differently. The parties also presented competing experts who provided different opinions about Kay’s mental condition when she executed the trust. Under these circumstances, we decline to conduct a de novo review. Instead, we will review the trial court’s determination for substantial evidence.

Testamentary Capacity Evaluated At The Time The Trust or Will Is Executed

In this case, the judgment turned on the evidence of Kay’s delusions and alleged testamentary capacity at the time the trust was executed in February 2016.

In its statement of decision, the trial court found that Kay was not experiencing delusions within the meaning of section 6100.5(a)(2) at the time she executed her trust. Thus, the court implicitly determined Kay did not have the requisite mental health disorder at the time she executed her trust.

The Court of Appeals noted:

Many of the witnesses . . . testified that they had no concerns regarding her mental capacity from November 2015 through her death a year later.

Even Dr. Spar, appellants’ expert who opined Kay had delusions arising from a mental disorder when she signed her trust, testified the “second best” explanation for why Kay changed her estate plan did not involve any delusions: specifically, it was possible that appellants upset Kay when they “swept” into her life after her hospitalization, and that she did not want to give her money to them. Dr. Spar acknowledged, after hearing all the evidence in the case, that a trier of fact could reasonably reach a different conclusion than the one he espoused.

Although the court acknowledged that Kay had delusions in late October 2015 while hospitalized for UTI, it determined her delusions ended shortly after her discharge from the hospital and were not operational when she signed the trust.

Hunt—who had many years of experience in estate planning and experience with clients with questionable mental capacity—met with Kay both before and when she executed the trust and the two subsequent trust amendments. Hunt never observed Kay to be forgetful or confused or cognitively impaired. Kay never exhibited paranoia or having delusions about appellants, and Hunt never believed Kay had a mental deficit.

The bottom line:  the delusions or lack of testamentary capacity must be demonstrated to have existed at the time the trust or will was executed to invalidate a will or trust under California law.  Testamentary capacity under California law is a very low standard, and evidence of delusions before or after the execution of the document, which were not demonstrated to have changed the disposition of the estate, will not invalidate a document.

In conclusion, the court stated:

In closing, we recognize the result here is likely a very disappointing one for appellants. Nevertheless, we are bound to apply the law (People v. Mowatt (1997) 56 Cal.App.4th 713, 720) and, under the substantial evidence standard, our role is circumscribed. We cannot reweigh the evidence; we determine only if there is any substantial evidence, contradicted or uncontradicted, which will support the judgment. (Estate of Sapp (2019) 36 Cal.App.5th 86, 104.)

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