What evidence is necessary to challenge the pay on death titling of a bank account based on undue influence? According to this recent appeal, you need to have some evidence of active procurement of the pay on death designation, and you need more than an unsigned schedule of accounts.
In Kester v. Rocco, (1st DCA 2013) the Decedent had a will leaving her assets to her children in equal shares. The Decedent had two bank accounts. The bank accounts had pay on death titling on them, leaving them to only one of her children.
The other children brought an undue influence action to set aside the pay on death titling and to bring the bank accounts into the probate estate. The trial court agreed with the other children, based on two pieces of evidence used to challenge the pay on death account designation. The first was a spreadsheet showing who was to receive the bank accounts. There was also testimony that the Decedent wanted all of her children to receive all of her assets equally.
The appellate court reversed, holding that there was no evidence of active procurement to set aside the pay on death titling of the accounts. The Court first set forth the law with respect to undue influence and active procurement.
Undue influence must amount to “over persuasion, duress, force, coercion, or artful or fraudulent contrivances to such an extent that there is a destruction of free agency and willpower of the testator.” Raimi v. Furlong, 702 So. 2d 1273, 1287 (Fla. 3d DCA 1997); see also Peacock v. Du Bois, 105 So. 321, 322 (Fla. 61925) (undue influence present where person “is not left to act intelligently, understandingly, and voluntarily” and the influence operates “to dethrone the free agency of the person . . . rendering his act the product of the will of another instead of his own”).
Undue influence is presumed when (i) a person with a confidential relationship with the testator, (ii) was active in procuring or securing the preparation or execution of the devise and (iii) is a substantial beneficiary thereof. See Estate of Brock, 692 So. 2d 907, 911 (Fla. 1st DCA 1996).
The active procurement element may be determined based on the following factors: presence of the beneficiary at the execution or the occasions where the testator expressed desire to devise, recommendation of an attorney, the beneficiary’s knowledge of the contents prior to its execution, giving instructions to the drafting attorney, securing witnesses and safekeeping of documents after execution. Raimi v. Furlong, 702 So. 2d at 1287; see also Hack v. Estate of Helling, 811 So. 2d 822, 826 (Fla. 5th DCA 2002) (adding (in)equality of mental capacity and strength between testator and beneficiary as factor). If sufficient facts are shown to raise the presumption, it may be rebutted by evidence to the contrary. Carpenter, 253 So. 2d 697 (Fla. 1971).
The Court applied the undue influence law to the facts before it in reversing the successful trial level challenge to the pay on death account titling:
[T]he evidence of Glenna’s active procurement of Mrs. Kester’s designations of ownership and beneficiaries on the accounts was insufficient to establish the second indicator of undue influence. The testimony was unrefuted that Glenna was not present on any occasion when Mrs. Kester created or changed the financial account ownership or beneficiary list. There was no evidence that Glenna gave her mother instructions regarding any account changes, that Glenna alerted any bank employees prior to her mother’s transactions, or otherwise actively participated in the account designations. In fact, the dates Mrs. Kester named Glenna as a joint account holder or POD beneficiary are not clear from the record and the signature cards and POD designation(s) are not in the record. Mrs. Kester’s statement to a bank employee to the effect that Glenna would “take care of everything” did not establish any conditions on Mrs. Kester’s designations or show that Mrs. Kester did not intend her actions on the accounts as written.
To prevail on an improper bank account titling or pay on death designation case, the opinion suggests, at a minimum, that the account titling documents should be entered into evidence. The lack of any evidence of active procurement facts (the “Carpenter factors”) in the pay on death designations was fatal to the case. Without having been present when the accounts were changed, and having given no instructions to change the titling on the accounts, there was no evidence of active procurement, hence no undue influence.
Although there are other ways to set aside bank account titling beyond showing active procurement factors, none of those other factors was present here. Hence the court was compelled to reverse the trial court’s judgment.