Challenging Wills, Trusts and Other Transactions Caused by Undue Influence of Other Persons
The 2008 Massachusetts case of Germain v. Girard has made it easier to challenge gifts, joint accounts, wills, trusts, beneficiary designations and other estate plan changes on the grounds of undue influence.
For undue influence to exist, a previous court had concluded in Heinrich v. Silvernail: “Four considerations are usually present in a case in which a supportable finding of undue influence has been made. These involve showings that an (1) unnatural disposition has been made (2) by a person susceptible to undue influence to the advantage of someone (3) with an opportunity to exercise undue influence and (4) who in fact has used that opportunity to procure the contested disposition through improper means.”
In Germain v. Girard, the person guilty of undue influence had received only an indirect benefit, as it was his wife who eventually received a larger inheritance. Since she had benefitted from his actions, and he would indirectly receive a financial benefit by being married to her, the court invalidated the trust amendment that the husband had directed a lawyer to prepare for his father-in-law shortly before death. That lawyer had represented the husband in prior cases and did not even meet his new “client” until he brought the trust amendment to the hospital to be signed.
Because of Germain and other recent Massachusetts case law developments, the burden of proof when arguing the existence of undue influence is no longer on the person challenging gifts, joint accounts and estate plan changes. If a person who was in a fiduciary role or other position of responsibility received a direct or indirect benefit from a transaction, that person will now be in the position of defending the transaction. If a person who relies on you for help in their everyday life is making any type of change that could possibly benefit you financially, that financial transaction or legal document can later be reversed or undone by the court if somebody else objects to it.
A large part of the court’s concern in Germain was that the lawyer drafting the new trust provisions was taking instructions from someone other than the person who was eventually going to sign the document. Therefore, lawyers who prepare documents are now being held to higher standards to make sure elderly and disabled persons are being protected. When an elderly or disabled person makes a gift, creates a joint account or makes changes to an estate plan (including wills, trusts, beneficiary designations and other probate-avoidance techniques), it is important that the elderly or disabled person receive independent legal advice, or else the transaction could later be declared null and void after an expensive legal battle.