Haynes v. First National State Bank

87 N.J. 163, 432 A.2d 890 (1981)

 

RULE:

The presumption of undue influence arose from a draftsman-attorney's conflict of interest and required a will's proponents to rebut the undue influence presumption by clear and convincing evidence. 

In terrorem clauses in the will and trust instruments were not enforceable where challenges to testamentary instruments were brought in good faith and probable cause existed to challenge the will.

FACTS:

Plaintiffs, two of a testatrix's six grandchildren, sought to set aside the probate of their grandmother's will and related trust instruments on the grounds of undue influence.  In an unreported opinion upholding the probate of the will and related trusts, the trial court held that the circumstances created a presumption of undue influence but that this presumption had been rebutted by defendants, one of the testatrix's daughters and the daughter's family attorney. It further ruled further that the in terrorem clause was unenforceable. The case was appealed to the Appellate Division, which affirmed the trial court as to the lack of undue influence, sustaining the probate of the will and its judgment upholding the related trust agreements, but disagreed with the trial court's ruling that the in terrorem clause was unenforceable. Plaintiffs then filed their petition for certification, which was granted.

ISSUE:

Did a trial court error in upholding the probate of the will and related trusts where circumstances created a presumption of undue influence but that this presumption had been rebutted by the proponents of the will, one of the testatrix's daughters and the daughter's family attorney who also drafted the testatrix's will and trusts?

ANSWER:

Yes.

CONCLUSION:

On further review, the court held that the trial judge failed to accord sufficient weight to the undue influence presumption arising from the conflict of interest of the attorney who drafted the will, who was also the daughter's family attorney, and that it was error to permit the proponents to rebut the presumption by a preponderance of the evidence where clear and convincing evidence was needed in the circumstances of the case. The court also held, in keeping with the policy of N.J. Stat. Ann. § 3A:2A-32, which took effect after the date of probate, that an in terrorem clause was unenforceable where probable cause existed to challenge the will. The judgment was reversed and remanded.

Click here to view the full text case and earn your Daily Research Points.