In Texas, the law regarding undue influence applies to wills, trusts, and other instruments, including account designations. In Fielding v. Tullos, a Texas appeals court affirmed a trial court’s summary judgment in favor of a caretaker and against heirs alleging undue influence regarding financial account designations. No evidence of exerted undue influence ended this case before trial in Texas.
Texas Law Regarding Undue Influence
To bring a successful challenge to an instrument based on undue influence, the challenger must prove:
- The existence and exertion of an influence;
- The effective operation of such influence so as to subvert or overpower the mind of the property owner at the time of the execution of the instrument;
- Execution of an instrument which the maker thereof would not have executed but for such influence.
Facts of Fielding v. Tullos
In Fielding, the decedent, Charles Hodge held several financial accounts at UBS. Hodge had no spouse and no children. Hodge’s heirs at law were several nephews and nieces.
In 1997, Janniece Tullos began working for Hodge and his wife as a caretaker. Tullos continued to care for Hodges when his wife died in 2004.
In 2004, Hodge designated beneficiaries for his accounts at UBS. Hodge named his sister as the primary beneficiary. Tullos and Hodge’s brother-in-law were named as 50% contingent beneficiaries in the event that Hodge’s sister predeceased Hodge.
In 2011, Hodge changed the beneficiary designations for the UBS accounts. Hodge named Tullos as the primary beneficiary of the accounts.
Hodge passed away in 2014.
The Record Evidence
The personal representative of Hodge’s estate sued to overturn the beneficiary designations on the basis of undue influence committed by Tullos. The evidence presented by the plaintiff was as follows:
- Tullos drove Hodge to UBS in 2004 when Hodge did the initial beneficiary designations naming Tullos as a 50% contingent beneficiary.
- Plaintiff alleged that the 2011 beneficiary designations in favor of Tullos demonstrated that the designations were done in the car in the UBS parking lot. Tullos was in the car.
- Tullos worked for Hodge seven days a week after Hodge’s wife died.
- Hodge spent birthdays and holidays with Tullos and Tullos’ family.
- Days prior to Hodge’s death, Tullos used her power of attorney to take $20,000 out of Hodge’s account and put it in her own account.
- After decedent’s death, Tullos withdrew $348,081.91 from the UBS accounts and used the money to buy a car and give her children each $100,000.
- Tullos had opportunities to influence Hodge because she was at his house every day, wrote his checks, made his bank deposits, and decedent left Tullos blank checks when he was hospitalized.
- Hodge had multiple medical issues, underwent 17 major surgeries, and was totally dependent on Tullos.
Caretaker Tullos provided her own evidence to demonstrate that no undue influence occurred, as follows:
- Hodge made it clear to his financial advisors that he intended to leave Tullos the funds in his UBS accounts.
- Tullos cared for Hodge daily for ten years.
- Hodge had no relationship with three of his nieces and nephews and a limited relationship with the others. None of the nieces and nephews had helped care for Hodge.
- The personal representative admitted that she had no personal knowledge to support her undue influence claim.
- The personal representative could not provide any examples of how Tullos exerted undue influence over Hodge.
Deposition testimony of Hodge’s financial advisors was also presented to the court, including:
- Tullos was not involved in decedent’s finances, although she drove him to UBS so that he could transact business.
- Hodge had good mental capacity in 2011 and appeared in control of his finances.
- Hodge explained to the financial advisors why he did not want certain family members to receive his money.
The Texas appeals court affirmed the summary judgment in favor of Tullos.
You Need Some Evidence of The Exertion Of Influence Over The Decedent To Defeat Summary Judgment
To be entitled to summary judgment in Texas, the movant must establish that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. Summary judgment is rare in general, and very rare in undue influence cases. In this case, the trial court determined, and the appeals court affirmed, that no record evidence was presented of Tullos’ influence over Hodge regarding the beneficiary designations that rose to the level of creating a material issue of fact for summary judgment.
The appeals court summarized the rationale as follows:
Although an opportunity for influence may have existed because of the close relationship between Tullos and Charles and because of the degree of care provided by Tullos, opportunity alone is not sufficient to prove undue influence without evidence of exertion of influence. See In re Estate of Sidransky, 420 S.W.3d at 96. The record gives no indication of force, intimidation, duress, persistent requests or demands, or deceit by Tullos. See Rothermel, 369 S.W.2d at 922. Consequently, the trial court would not have erred in concluding that summary judgment evidence offered by Tullos rebutted any presumption of undue influence. See Saenz, 873 S.W.2d at 359.There also was no evidence that Charles would not have designated Tullos as his beneficiary but for the alleged undue influence.
The bottom line is that you do not have a case for undue influence in Texas just because a beneficiary designation seems unnatural or because you do not like the result. Some evidence must be presented to show that influence was not just present, but that it was exerted with respect to the challenged instrument. If you proceed with an undue influence challenge with no such evidence, you risk losing on summary judgment like the plaintiffs in this case.