No
No. 97-532
IN THE SUPREME COURT OF THE STATE OF MONTANA
1998 MT 198
VERNA JOYCE HAUCK,
Plaintiff, Appellant and Cross-Respondent,
v.
MERLE L. SERIGHT, as an individual
and as Personal Representative of the
Estate of Alice A. Sisson, Deceased,
Defendant, Respondent and Cross-Appellant.
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APPEAL FROM: District Court of the Tenth Judicial
District,
In and for the County of Fergus,
Honorable John R. Christensen, Judge Presiding.
COUNSEL OF RECORD:
For Appellant:
Robert L. Johnson, Attorney at Law, Lewistown, Montana
For Respondent:
Jon A. Oldenburg, Attorney at Law, Lewistown, Montana
Leonard H. McKinney, Attorney at Law, Lewistown, Montana
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Submitted on Briefs: June 14, 1998
Decided: August 11, 1998
Filed:
__________________________________________
Clerk
Chief Justice J. A. Turnage delivered the Opinion of the Court.
¶ In this will contest, the Tenth Judicial District Court, Fergus County, dismissed
Verna Joyce Hauck's claim for tortious interference with an expectancy. On Hauck's
other claims, a jury found that Merle Seright unduly influenced his aunt and
Hauck's adoptive mother, Alice A. Sisson, when she executed her October 30, 1992
Will, but that Sisson was free from undue influence in other transactions. The court
ordered formal probate proceedings as to Sisson's October 27, 1992 Will. Hauck
appeals, and Seright cross-appeals. We affirm.
¶ Hauck raises the following issues on appeal:
¶ 1. Did the District Court err in dismissing Hauck's damage case against Seright for
tortious interference with her expectancy from decedent Sisson?
¶ 2. Did the court err in adjudging that a $105,000 withdrawal from Sisson's capital
and a $100,000 quasi-testamentary disposition were valid transfers?
¶ 3. Did the court err in admitting Sisson's October 27, 1992 Will to probate?
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¶ 4. Did the court err in granting Seright his attorney fees and costs?
¶ On cross-appeal, Seright raises a fifth issue, arguing that the court erred in failing
to grant his motions for directed verdict and for judgment notwithstanding the
verdict.
Background
¶ In the pretrial order, the parties stipulated to the following facts:
1. Plaintiff Verna Joy Hauck resides in Seal Rock, Oregon and she is the
adopted daughter of the late Alice A. Sisson. Mrs. Sisson died in Lewistown,
Montana on September 30, 1995 at the age of ninety years. Defendant Merle
L. Seright is a resident of Fort Benton, Montana and he is one of Mrs. Sisson's
nephews.
2. Mrs. Sisson was the widow of the late Laurence R. "Ray" Sisson who died
in Lewistown, Montana on May 19, 1990. Mrs. Sisson inherited all of Ray
Sisson's property.
3. After Mrs. Sisson's death Merle Seright commenced informal proceedings
in this court to administer her estate. The clerk appointed him personal
representative under the terms of a Will he filed which was dated October 30,
1992. Merle Seright petitioned the court for an order admitting that Will to
probate, and Joy Hauck contested claiming that the Will was procured by
Merle Seright through undue influence. It conflicts with the provisions of a
Will Mrs. Sisson executed on October 27, 1992. In an independent action Joy
Hauck complains that Merle Seright interfered with her expectancy of
inheritance from Mrs. Sisson, and she asks that he respond to her in
appropriate damages. The Will contest and the damage action have been
consolidated for trial.
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¶ At trial, Hauck testified that she had known the Sissons all her life and that she had
maintained a close relationship with them for many years. After Ray Sisson died in
1990, Hauck stayed with Alice Sisson for about a month and helped with her
financial and other affairs. During that visit, Sisson adopted Hauck as her daughter
and granted her a power of attorney. Sisson later canceled that power of attorney
when she became aware that Hauck was receiving her bank statements.
¶ In February 1991, Sisson executed another power of attorney naming Hauck as her
attorney-in-fact. In April of that year, however, Sisson again revoked Hauck's power
of attorney and instead named Seright as her attorney-in-fact. Also during April of
1991, Sisson made a $100,000 account she held with the Edward D. Jones investment
firm payable upon her death to Seright and his brothers and sisters.
¶ On October 27, 1992, while Hauck was again visiting her, Sisson executed a Will in
the offices of her longtime Lewistown, Montana attorneys, Wilkins & Berger. In that
Will, Sisson bequeathed to Hauck 40 percent of her estate, which exceeded $400,000
in total value. Three days later, on October 30, 1992, after Hauck had left town,
Seright took Sisson to the offices of another Lewistown attorney, Leonard McKinney.
There, Sisson executed a Will reducing Hauck's share of her estate to $10,000 and
canceling Hauck's inheritance altogether if Hauck contested the Will.
¶ In December 1992, upon Seright's petition alleging that Sisson was incapacitated
and unable to make a consistent estate plan, the District Court appointed Lewistown
attorney Leonard McKinney as Sisson's legal guardian. The petition was supported
by the recommendation of Sisson's physician, who stated that Sisson did not have
good short term memory and was not able to perform moderately complex
calculations.
¶ Following Sisson's death in September 1995, Seright applied for probate of her
October 30, 1992 Will. Hauck contested that Will. She also filed a separate action
against Seright alleging that he had fraudulently represented to Sisson that Hauck
was stealing from her, inducing Sisson to allow his name and those of his siblings to
be placed upon her securities as beneficiaries at her death. The two matters were
consolidated for trial.
¶ Both parties presented evidence at trial that Sisson was susceptible to the influence
of others in her decision making. Hauck admitted that her relationship with Sisson
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had cooled dramatically in the last years of Sisson's life, but she contended that this
was because of Seright's improper influence upon Sisson. Seright presented witnesses
who testified to the effect that Sisson distrusted Hauck and wanted to distance herself
from Hauck financially as much as she could in spite of their adoptive mother-
daughter relationship. Hauck contended that Seright influenced Sisson in April 1991
to make the $100,000 Edward D. Jones account payable to himself and his siblings
upon Sisson's death; to execute her October 30, 1992 Will; to transfer $105,000 from
her Edward D. Jones account to him and his wife in December 1992; and, in January
1993, to list him and his siblings as the beneficiaries of a $100,000 IDS investment
account. Seright presented evidence that it was Hauck who was influencing Sisson to
make financial decisions which she really did not want to make, and that he had
merely helped Sisson to carry out her own wishes.
¶ The court ruled that there was no evidence of undue influence as to the April 1991
transfer of Edward D. Jones funds, and did not submit that issue to the jury. In
answer to special interrogatories, the jury found that Sisson was not free from undue
influence by Seright when she executed her October 30, 1992 Will. The jury found,
however, that Sisson was free from undue influence from Seright when she
transferred her Edward D. Jones funds to him and his wife in December 1992 and
when she named Seright and his siblings as beneficiaries on her IDS account in
January 1993.
¶ After trial and after the parties filed various post-trial motions, the October 27 Will
was admitted to formal probate.
Issue 1
¶ Did the District Court err in dismissing Hauck's damage case against Seright for
tortious interference with her expectancy from decedent Sisson?
¶ After Hauck presented her case in chief at trial, Seright moved to dismiss all of her
claims. As to the claims for tortious interference with an expectancy, the court took
the motion under advisement. At the close of the evidence, the court granted the
motion to dismiss the claim for tortious interference with an expectancy as to the
April 22, 1991 transaction in which Sisson transferred $100,000 into a payable-on-
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death Edward D. Jones account. The court stated that there was insufficient evidence
to go to the jury on that claim. The court did not allow the jury to consider the
tortious interference claim because "I think this is an undue-influence case."
¶ Tortious interference with an expectancy has not heretofore been recognized as a
legal theory in Montana. Where it is recognized, the tort consists of intentionally and
by fraud, duress, or other tortious means preventing another from receiving from a
third person an inheritance or gift that he would otherwise have received.
Restatement (Second) of Torts § 774B (1977).
¶ The elements of undue influence are: (1) a confidential relationship between the
person alleged to be exerting undue influence and the testator; (2) the testator's
physical condition affects her ability to withstand undue influence; (3) the testator's
mental condition affects her ability to withstand undue influence; (4) the
unnaturalness of the disposition shows an unbalanced mind or a mind easily
susceptible to undue influence; and (5) the demands and importunities may have
affected the testator, taking into consideration the time, place, and surrounding
circumstances. Matter of Estate of Jochems (1992), 252 Mont. 24, 28, 826 P.2d 534,
536.
¶ The court allowed Hauck's claims regarding the December 1992 and January 1993
transactions to go to the jury on a theory of undue influence. Hauck has not shown
how it would have been to her advantage had the court instead or in addition allowed
her to proceed on a theory of tortious interference with an expectancy as to those
transactions. We conclude that the court did not err in ruling that this case was tried
as a claim for undue influence.
¶ The only claim which the court did not allow the jury to consider under any theory
was Hauck's claim that the April 1991 transfer was improper. In reviewing a
directed verdict, this Court will consider only the evidence introduced by the party
against whom the directed verdict is granted. If that evidence, when viewed in a light
most favorable to the party, tends to establish the case alleged in the party's pleading,
we will reverse the directed verdict. The test is whether reasonable persons could
draw different conclusions from the evidence. Wise v. Ford Motor Co. (1997), 284
Mont. 336, 343, 943 P.2d 1310, 1314.
¶ Sisson's Edward D. Jones agent provided the only direct evidence as to the April
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1991 transaction. The agent testified that prior to that time, Sisson asked him on a
number of occasions what she could do to move some of her assets out of her
accounts and to get them out of her estate because "[s]he was concerned that those
dollars because of the way things were going were going to end up in Joy Hauck's
hands, and she didn't want that to happen." He testified that she "absolutely" knew
what she was doing when she made the transaction and that he felt no one had put
any pressure on her to make the transaction.
¶ We agree with the District Court that on this record there was no evidence to
support a claim of tortious interference with expectancy as to the April 1991
transaction. For that reason, and because Hauck's claims as to the October 30, 1992
Will and the December 1992 and January 1993 transactions went to the jury on
theories of undue influence, we need not address whether tortious interference with
an expectancy will be recognized as a cause of action in Montana. We hold that the
District Court did not err in dismissing Hauck's damage case against Seright for
tortious interference with her expectancy from Sisson.
Issue 2
¶ Did the court err in adjudging that a $105,000 withdrawal from Sisson's capital
and a $100,000 quasi-testamentary disposition were valid transfers?
¶ The jury found in answer to special interrogatories that neither Sisson's transfer of
$105,000 in Edward D. Jones funds on December 18, 1992, nor her January 27, 1993
transfer of $100,000 in IDS funds was a matter of undue influence. Hauck argues
that the court went beyond the jury's verdict in stating in its judgment that these
were "valid transfers." She asks that such language be stricken from the judgment as
being outside the issues submitted as to the December 18 transfer and as an improper
preclusion of any future argument that the January 27 transfer was a voidable act by
an unadjudicatedly incapacitated person. Hauck fears that the court's order has the
effect of authorizing Seright and his wife to keep the $105,000--a result even Seright
testified was not Sisson's intention. He testified that he and his wife were merely
holding this money for Sisson to cover any possible medical expenses she might incur.
¶ The court's order stated, "The transfer of funds by Alice A. Sisson to Merle and
Priscilla Seright, from her account at Edward D. Jones, on December 18, 1992, was a
valid transfer and not as a result of undue influence," and, "The transfer by Alice A.
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Sisson from IDS Bond Fund account no. . . . on January 27, 1993, to trust accounts
whereby [Seright and his siblings] are beneficiaries, were valid transfers and not as a
result of undue influence."
¶ Our review of the court's order shows that its language follows that used in the
special interrogatories agreed to by the parties and upon which the jury rendered its
verdict. We hold that the court did not err in its judgment.
Issue 3
¶ Did the court err in admitting Sisson's October 27, 1992 Will to probate?
¶ Under this issue, Hauck argues that as a result of the defeat of the October 30, 1992
Will, Sisson should be deemed to have died intestate. Hauck makes a somewhat
round-about argument that under the doctrine of dependent relative revocation,
Sisson's October 27 Will should be deemed revoked in order to comply with Sisson's
intent that Hauck inherit the bulk of her estate. Hauck argues for a determination of
intestacy by which, as Sisson's adopted daughter, she would inherit all of the
property remaining within Sisson's estate.
¶ The doctrine of dependent relative revocation presumes that a testator who has
canceled an old will preparatory to making a new will which thereafter fails would
prefer the old will to an intestacy. Matter of Estate of Patten (1979), 179 Mont. 299,
301-02, 587 P.2d 1307, 1309. For the doctrine to apply, the new will must not have
changed the testamentary purpose of the old will and must essentially repeat the
same dispositive plans.
¶ Hauck argues that the October 27 Will is strikingly dissimilar to the October 30
Will and that, because the doctrine of dependent relative revocation therefore does
not apply, the October 27 Will is void. However, she offers no authority for this type
of reverse application of the doctrine. Further, the two Wills differ only as to the
relative shares to be received by Hauck and by Seright and his siblings. Sisson's
grants of $5,000 to the City of Lewistown, Montana ambulance service and $5,000 to
each of three of her friends remain the same under both Wills and would not exist in
intestacy. We conclude the District Court did not err in failing to invalidate the
October 27 Will under the doctrine of dependent relative revocation.
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¶ Seright further responds to Hauck's argument under this issue by stating that the
validity of the October 27 Will was not a trial issue, that Will not having been
challenged in these proceedings. He maintains that even if Sisson's mental condition
rendered her subject to undue influence on October 27, 1992, no one has alleged
undue influence as to the October 27 Will. In fact, in her original petition in the will
contest, Hauck asked that the October 27 Will be admitted to probate.
¶ An order admitting a will to probate is appealable under Rule 1, M.R.App.P.
Hauck's notice of appeal states that she is appealing from the final judgment entered
on July 21, 1997, and from the order regarding post-trial motions entered August 26,
1997. As part of the order regarding post-trial motions, the District Court ordered
Sisson's October 27 Will admitted to formal probate. We conclude that the court's
admission of that Will into probate is an appealable order which is properly a subject
of this appeal.
¶ Despite Hauck's position that the validity of the October 27 Will was not an issue at
trial, she presented evidence at trial that the October 27 Will was prepared by
Sisson's longtime attorneys, who, prior to and during the execution of the Will,
carefully interviewed Sisson about her testamentary intent. Those attorneys
preserved that interview on an audiotape, which was played for the jury at trial. The
two attorneys who witnessed the October 27 Will both testified that they did not feel
Sisson was being unduly influenced at the time she executed the Will, and the
attorney who drafted the Will testified that he had no doubt that Sisson was
competent when she executed it. There was no evidence at trial that Seright unduly
influenced Sisson as to the October 27 Will.
¶ We hold that the court did not err in admitting the October 27, 1992 Will to
probate.
Issue 4
¶ Did the court err in granting Seright his attorney fees and costs?
¶ In arguing that the District Court erred in awarding costs and attorney fees to
Seright for defense of the will contest, Hauck relies on § 72-12-206, MCA. That
statute provides:
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If the probate is revoked, costs, as provided in 25-10-201, but not attorney
fees, must be paid by the party who resisted the revocation or out of the
property of the decedent, as the court directs.
Hauck asserts that under this statute attorney fees are not included within the term "costs"
and that there is no special statute authorizing payment of attorney fees from the assets of
the estate in the unsuccessful defense of a will contest.
¶ Seright acknowledges that under the above statute, attorney fees are not included
within the term "costs." He points out, however, that § 72-3-632, MCA, specifically
authorizes payment of reasonable attorney fees by the estate if the personal
representative (in this case, Seright) defends a will contest in good faith.
¶ Section 72-3-632, MCA, states: "If any personal representative or person
nominated as personal representative defends or prosecutes any proceeding in good
faith, whether successful or not, he is entitled to receive from the estate his necessary
expenses and disbursements, including reasonable attorneys' fees incurred." In this
case, there is no claim that the attorney fees are unreasonable.
¶ Hauck points out that she prevailed in the part of the action concerning Sisson's
October 30, 1992 Will, and that under Seright's prevailing position, the IDS and
Edward D. Jones accounts are not part of the estate. She argues that Seright's
success in defending those transfers was not in his capacity as personal
representative, but in his individual capacity.
¶ The fact remains, however, that as a significant part of this action Seright defended
the October 30 Will under which he was personal representative of Sisson's estate.
Under § 72-3-632, MCA, he is entitled to reasonable attorney fees for that effort,
whether he was successful in defending on that claim or not. Hauck's claims under
her various legal theories were factually intertwined. Additionally, if Seright had not
defended the three transfers which the court and the jury upheld, the transferred
property could have been determined to be part of the estate and Seright would have
been remiss in his capacity as personal representative in not having included them
therein.
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¶ We review an award of attorney fees to determine whether the trial court abused
its discretion. Matter of Estate of Stone (1989), 236 Mont. 1, 4, 768 P.2d 334, 336.
Here, we hold that the District Court did not abuse its discretion in awarding Seright
his attorney fees.
Issue 5
¶ Did the court err in failing to grant Seright's motion for directed verdict or motion
for judgment notwithstanding the verdict?
¶ Seright contends there was not enough evidence that he exerted undue influence
upon Sisson to allow the court to submit to the jury the issue of the validity of the
October 30 Will. This Court's standard of review of a decision on judgment as a
matter of law through either denial of a motion for directed verdict or denial of a
motion for judgment notwithstanding the verdict, is the standard set forth under
Issue 1 above: whether the evidence, viewed in a light most favorable to the
nonmoving party, tends to establish the case alleged in the party's pleading. A
judgment as a matter of law should be granted only if reasonable persons could not
draw different conclusions from the evidence. Wise, 284 Mont. at 343, 943 P.2d 1310,
1314.
¶ In this case, Hauck established that Sisson executed two different wills within three
days in October 1992. In one, Hauck would receive 40 percent of Sisson's $400,000
estate; in the other, Hauck would receive only $10,000 and Seright and his siblings
were awarded the residue of the estate. In denying the motion for directed verdict,
the District Court pointed to the evidence that Sisson vacillated and to her doctor's
testimony that she had a poor memory. Hauck points out that Seright admitted at
trial that in October 1992 Sisson was approximately 87 years old, could not make a
consistent plan for her estate; was elderly enough and confused enough that she
could have been unduly influenced by him at that time; and that he could have
forced her to do what he wanted her to do.
¶ When viewed in a light most favorable to Hauck, the evidence tended to establish
her case. Reasonable persons could have drawn different conclusions from the
evidence. We hold, therefore, that the District Court did not err in failing to grant
Seright's motion for directed verdict or for judgment notwithstanding the verdict.
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¶ Affirmed.
/S/ J. A. TURNAGE
We concur:
/S/ KARLA M. GRAY
/S/ JAMES C. NELSON
/S/ JIM REGNIER
/S/ WILLIAM E. HUNT, SR.
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