UNITED OF OMAHA LIFE INSURANCE COMPANY V JERRI L NEES
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STATE OF MICHIGAN
COURT OF APPEALS
UNITED OF OMAHA LIFE INSURANCE
COMPANY,
UNPUBLISHED
September 23, 2010
Plaintiff,
V
JERRI L. NEES, Individually and as Conservator
of the Estate of MAKENZIE A. NEES, a Minor,
No. 292316
Jackson Circuit Court
LC No. 07-002157-CZ
Defendant/Cross-DefendantAppellee,
and
MATTIE I. TOMLIN,
Defendant/Cross-Plaintiff-Appellant.
Before: WILDER, P.J., and CAVANAGH and M. J. KELLY, JJ.
PER CURIAM.
In this dispute over the proper distribution of the proceeds from a life insurance policy,
cross-plaintiff Mattie I. Tomlin appeals as of right the trial court’s entry of judgment in favor of
cross-defendant Jerri L. Nees, individually and as the conservator of the estate of Makenzie A.
Nees, after a bench trial. On appeal, we must determine whether the trial court erred when it
found that Tomlin had not established a presumption that Nees had unduly influenced Willis
Tomlin (Willis) to change the beneficiary designation on his life insurance policy shortly before
he died. We conclude that the trial court clearly erred in its findings concerning the presumption
of undue influence. Further, although there is evidence to support the trial court’s ultimate
finding that the change in beneficiaries was not the result of undue influence, on this record, we
cannot conclude that the trial court would have made the same findings had it properly applied
the presumption. For that reason, we vacate the trial court’s ruling from the bench and the
judgment in favor of Nees and remand for new findings consistent with this opinion.
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I. BASIC FACTS AND PROCEDURAL HISTORY
Willis had the life insurance policy at issue through his employer, the Michigan
Department of Corrections. In 1993, he designated Tomlin, who is his mother, as his sole
beneficiary under the policy. Willis met Nees in about 1996 and after a few years he moved into
Nees’ home. According to Nees, they dated for nine-years, but never married. During the
relationship, Willis and Nees had a daughter, Makenzie Nees.
Willis began to have serious medical problems in the summer of 2005. He had surgery
the following summer to remove a mass on his liver, but it went poorly. He remained in the
hospital until his death in December 2006.
According to Nees, Willis “wasn’t himself” after the surgery and never regained the use
of his voice. She testified that, despite Willis’s inability to talk, she learned to read his lips, and
that he was able to communicate what he wanted by moving his mouth and gesturing. Tomlin
testified that Willis could not communicate at all. Another witness likewise described Willis as
wholly unable to communicate, but others described him as being able to communicate but
minimally.
Willis executed a medical power of attorney and a general power of attorney authorizing
Nees to act on his behalf. Nees testified that she was not present when Willis signed the powers
of attorney, but that he was “medically cleared” by the hospital before he signed.
Nees testified that she and Willis had also discussed updating the beneficiary designation
on the life insurance policy after she learned that she was pregnant, but Willis had procrastinated.
She stated that about a week before Willis died, he “told [her] that he was ready to update his
benefits, and he wanted [her] to bring the forms to him.” Nees said that she filled out the change
of beneficiary form in accordance with Willis’ instructions. According to Nees, although Willis
could not talk, he instructed her how to fill out the change form “by moving his mouth.” The
change form provided 50% of the insurance proceeds to appellee and 50% to their daughter.1
Nees testified that she was not at the hospital when Willis changed the beneficiary designations
on his policy. She explained that she thought it was “odd” for him to make her his beneficiary
rather than his son2 and so she requested that a social worker and notary help with the documents
and told him that she “didn’t want him to sign it in front of [her] because he put me on there.”
Nees denied resorting to any threats, coercion, or flattery of any kind to induce Willis into
changing beneficiaries.
A social worker and a notary public who were involved with the execution of Willis’
change form both testified that Willis understood the nature of the document, and wished to sign
it.
1
The same day, Nees filled out two other change forms—one for retirement benefits and one for
a different life insurance policy. She listed Makenzie as the sole beneficiary for both and neither
is at issue on appeal.
2
Willis had an older son from a previous relationship.
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Nees’ sister testified that Willis once told her that he would never list Nees as a
beneficiary because of the way she treated him. She also stated that, after Willis’ death, Nees
admitted that she had threatened to leave Willis if he did not change the beneficiary designation:
she went up to the hospital and told [Willis] that if he didn’t sign them papers,
that she was not going to ever come back up there again, and she was going to
take down all the pictures of Makenzie that was on the wall, and he would never
see her again.
Nees and her sister admitted that they had a strained relationship, and the trial court found Nees’
sister’s testimony to not be credible.
After Willis died, Tomlin apparently disputed the change in beneficiaries with the
insurer, United of Omaha Mutual Insurance. In August 2007, United sued Nees, in her
individual capacity and as the conservator of Makenzie’s estate, as well as Tomlin, in order to
resolve the dispute over the proceeds of Willis’ policy. United asked the trial court to compel
Tomlin and Nees to interplead their claims. See MCR 3.603. After United deposited the
disputed insurance proceeds with the clerk, the trial court signed an order discharging United
from any further liability under the policy and ordering Tomlin and Nees to interplead their
claims.
In April 2008, Tomlin cross-complained against Nees. In her cross-complaint, Tomlin
alleged that Nees had unduly influenced Willis to change the beneficiary of the policy from
Tomlin to Nees and Mackenzie. After a bench trial, the court found that Nees had not unduly
influenced Willis to change the beneficiary. For that reason, the trial court entered a judgment in
favor of Nees and ordered that the proceeds of the insurance policy be distributed to her in her
individual capacity and as the conservator of Makenzie’s estate.
This appeal followed.
II. THE PRESUMPTION OF UNDUE INFLUENCE
The sole issue on appeal is whether the trial court erred when it determined that Tomlin
had not established the presumption of undue influence. An action to have a testamentary
transfer set aside on the grounds that the transfer was procured through undue influence is
equitable in nature. Adams v Adams, 276 Mich App 704, 714 n 5; 742 NW2d 399 (2007). When
reviewing a trial court’s decision regarding equitable relief after a bench trial, this Court reviews
the trial court’s findings of fact for clear error, but reviews de novo whether equitable relief was
warranted under the facts. Flint v Chrisdom Properties, Ltd, 283 Mich App 494, 498; 770
NW2d 888 (2009).
To establish the existence of undue influence, the charging party must present evidence
that the grantor’s will was overborne:
“To establish undue influence it must be shown that the grantor was
subjected to threats, misrepresentation, undue flattery, fraud, or physical or moral
coercion sufficient to overpower volition, destroy free agency and impel the
grantor to act against his inclination and free will. Motive, opportunity, or even
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ability to control, in the absence of affirmative evidence that it was exercised, are
not sufficient.” In re Karmey Estate, 468 Mich 68, 75; 658 NW2d 796 (2003),
quoting Kar v Hogan, 399 Mich 529, 537; 251 NW2d 77 (1976).
However, there is a presumption of undue influence in transactions where the evidence
establishes “‘(1) the existence of a confidential or fiduciary relationship between the grantor and
a fiduciary, (2) that the fiduciary (or an interest which he represents) benefits from the
transaction, and (3) that the fiduciary had an opportunity to influence the grantor’s decision in
that transaction.’” In re Karmey Estate, 468 Mich at 73, quoting Kar, 399 Mich at 537. If the
charging party establishes a presumption of undue influence, a “mandatory inference” is created
that shifts “‘the burden of going forward with contrary evidence onto the person contesting the
claim of undue influence. However, the burden of persuasion remains with the party asserting
such. If the defending party fails to present evidence to rebut the presumption, the proponent has
satisfied the burden of persuasion.’” In re Peterson Estate, 193 Mich App 257, 260, 483 NW2d
624 (1991), quoting In re Mikeska Estate, 140 Mich App 116, 121; 362 NW2d 906 (1985).
In this case, the trial court recognized that Nees had some form of a fiduciary relationship
with Willis: “And I did find that by being named power of attorney, and health care power of
attorney, or patient advocate, Ms. Nees had a duty to act for the benefit of Willis Tomlin as it
pertained to the use of the powers of attorney.” Nevertheless, the trial court concluded that this
element had not been met because Nees “did not use the power of attorney to change the
beneficiary.” The trial court also found that Nees “clearly benefited from the change in the life
insurance,” but found that Nees did not have the opportunity to influence Willis. The court
explained that only Nees’ sister testified that Nees had threatened Willis and she was not
credible. Further, the trial court stated that Nees was only at the hospital out of concern for
Willis.
We conclude that the trial court clearly erred when it found that Tomlin had not
established the presumption of undue influence. The undisputed evidence established that Nees
had been given a general power of attorney over Willis’ affairs. The grant of a general power of
attorney establishes a fiduciary relationship as a matter of law. See In re Conant Estate, 130
Mich App 493, 498; 343 NW2d 593 (1983). And whether she used her fiduciary relationship to
effect the change in the beneficiary is irrelevant. Further, in addressing the third element for a
presumption of undue influence, the trial court focused on the evidence that Nees actually
asserted undue influence and her motive for visiting Willis in the hospital. However, the issue
with regard to that element was whether Nees had the opportunity to unduly influence Willis’
decision and not whether she actually did. Given the undisputed evidence, Nees clearly had the
opportunity to influence Willis to change the beneficiary designation on his insurance policy.
See In re Karmey Estate, 468 Mich at 73. Thus, Tomlin established the presumption and Nees
had to present evidence to rebut that presumption. In re Peterson Estate, 193 Mich App at 260.
III. CONCLUSION
Although the trial court clearly erred in its findings concerning whether Tomlin
established the presumption, the trial court also clearly found that Willis’ decision to change the
beneficiary was not the product of undue influence. Nevertheless, on this record we cannot
ascertain whether the trial court’s ultimate finding was influenced by its erroneous determination
that Tomlin had not established the presumption. The trial court may very well have concluded
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that—in the absence of the presumption—Tomlin simply had not presented enough evidence to
establish undue influence and found accordingly. Given that the trial court is in the best position
to make findings and assess credibility, we conclude that this case should be remanded to the
trial court for further findings. Specifically, the trial court shall make new findings concerning
whether—in light of the established presumption of undue influence—Nees rebutted the
presumption. Accordingly, we vacate the trial court’s ruling from the bench, vacate the
judgment entered in favor of Nees, and remand this case for further findings consistent with this
opinion.
Vacated and remanded for further proceedings consistent with this opinion. We do not
retain jurisdiction. As the prevailing party, Tomlin may tax costs. MCR 7.219(A).
/s/ Kurtis T. Wilder
/s/ Mark J. Cavanagh
/s/ Michael J. Kelly
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