Court Awards Fees To Plaintiff In Will Contest Because He Had Reasonable Cause To File His Complaint
In re Estate of Grischuk, A-3890-18, 2021 WL 3160466 (N.J. Super. App. Div. July 27, 2021).
This appeal encompassed a will contest and a dispute as to counsel fees.
The decedent was survived by her sister, defendant Olga Sweeney (“Olga”), her nephew, plaintiff Michael David (“Michael”), and others.
With the assistance of her long-time attorney, the decedent drafted five wills over an 11-year period. She executed her final will in 2015 (“2015 Will”).
Michael sought to invalidate the 2015 Will. He alleged that the decedent lacked testamentary capacity and that Olga exercised undue influence.
After a four-day bench trial, the trial court rejected Michael’s claims, upheld the 2015 Will, and ruled on counsel fees. The appeal thus addressed (1) incapacity, (2) undue influence, and (3) counsel fee awards.
The trial court found that the decedent had testamentary capacity when she executed the 2015 Will. The court concluded that Michael’s incapacity claim was based only on his subjective opinion that the decedent was in failing health when she executed the will. Michael’s opinion was contradicted by the other testimony and medical records.
The Appellate Division affirmed and explained that a very low degree of mental capacity is required to execute a will. Courts must consider whether the testator was able to “comprehend the property [she was] about to dispose of; the natural objects of [her] bounty; the meaning of the business in which [she was] engaged; the relation of each of these factors to the others, and the distribution that is made by the will.” In re Livingston’s Will, 5 N.J. 65, 73 (1950). Capacity is tested at the time of execution of the will. Id. at 76.
In addition, a decedent is presumed to have been of sound mind and competent when she executed the will. Haynes v. First Nat’l Bank, 87 N.J. 163, 175-76 (1981). “[T]he burden of establishing a lack of testamentary capacity is upon the one who challenges its existence . . . [and] must be [proven] by clear and convincing evidence.” In re Estate of Hoover, 21 N.J. Super. 323, 325 (App. Div. 1952).
Michael argued that the trial court ignored medical records establishing that the decedent suffered from anxiety and depression and was in a weakened state at the time she executed the will. He also argued that the court overlooked testimony from the decedent’s caregiver regarding her physical and mental state.
The Appellate Division disagreed and noted that the record contained other evidence that the decedent was mentally sharp and making reasoned decisions at the time she executed the 2015 Will. The attorney who prepared the will and was present for its execution had no doubt of the decedent’s capacity.
- Undue Influence
The trial court concluded that Michael had not proven that Olga exerted undue influence on the decedent as to the 2015 Will. The court relied on the testimony of the drafting attorney. The court further found that, although Olga was present when the decedent met with her attorney before executing the will, Olga neither spoke to the decedent nor the attorney about its contents nor to anyone else to influence the bequests.
As to a presumption of undue influence, the trial court found that Olga and the decedent maintained a confidential relationship – for example, they shared a joint bank account, and had both been represented by the attorney who drafted the 2015 Will. The trial court also noted that one could reasonably conclude that suspicious circumstances surrounded the decedent’s changes to Michael bequests in her series of wills.
Nevertheless, the court concluded that Michael’s claim of undue influence failed in the context of the entirety of the case, because the facts simply were lacking to prove that Olga dominated the decedent or that the decedent relied upon Olga to make decisions on her behalf. Instead, the court found that the decedent made all of her financial decisions and continued to pay her own bills until her death. Although Olga had written checks on the joint account she held with the decedent, these were at the decedent’s direction and for her convenience. Olga made no financial decisions on behalf of the decedent, nor did she benefit from any of her activities on the decedent’s behalf.
The Appellate Division again affirmed, explaining that not all influence is “undue.” Mere persuasion, suggestions, or the opportunity to exert influence over a testator are not sufficient to invalidate a will. Livingston’s Will, 5 N.J. at 73.
Indeed, the Appellate Division agreed with the trial court that, even though a confidential relationship and suspicious circumstances existed, “the suspicion was dispelled by proof of [the] decedent’s independent and informed decision to execute the will.” Grischuk, at *4.
- Counsel Fees
Michael applied to the trial court for an award of attorney fees and costs from the estate pursuant to Rule 4:42-9(a)(3). Olga opposed the motion and cross-moved for sanctions against Michael pursuant to N.J.S.A. § 2A: 15-59.1(a) and Rule 1:4-8 for having filed frivolous claims.
The trial court awarded Michael $84,030 in attorney’s fees and $5,350.91 in costs and denied Olga’s motion for sanctions. The court concluded that Michael had reasonable cause to file his complaint based on information then in his possession. However, Olga’s discovery responses made clear that Michael’s claims were baseless and he should not have proceeded to trial. As a result, the court awarded Michael only those attorney fees and costs on the incapacity claim up to the point of his receipt of the decedent’s medical records and on the undue influence claim up to the last deposition of a trial witness. The court awarded no attorney fees or costs to Michael related to trial preparation after August 12, 2017, or for the trial.
After summarizing the standards for counsel fee awards, the Appellate Division concluded that the trial court acted within its discretion when it awarded the fees and costs to Michael. However, the appellate court agreed with Olga that the trial court’s decision lacked precision: the court did not identify the date on which Michael received the decedent’s medical records or explain in any detail the amounts sought by Michael but disallowed. In addition, the court issued only a conclusory statement that the time spent by Michael’s attorneys and the hours they expended were reasonable.
After noting that a remand would result in additional expenses which would further deplete the relatively modest estate, and that the trial judge had retired, the appeals court undertook its own review of Michael’s application for attorney fees. It concluded that the amount of fees and costs awarded reflected an equitable exercise of the trial court’s discretion in light of the record, Michael’s lack of success, and the court’s conclusions regarding reasonable cause.
Finally, the Appellate Division rejected Olga’s argument that the trial court erred when it denied her motion for sanctions. Although the trial court did not issue findings of fact and conclusions of law addressing Olga’s motion for sanctions, the judge found that Michael had reasonable cause to file his complaint and to pursue his claims through discovery. Implicit in those findings was the conclusion that Michael’s complaint was not frivolous. In addition, the trial court’s limitation on the award of attorney fees and costs was sufficient to resolve Olga’s claims that Michael’s pursuit of a trial was wrongful.