When elderly clients begins making radical changes to their estate plan, most planners begin wondering whether they're truly making those decisions on their own, or whether they're the victim of undue influence.
Undue influence has been defined as "the use of improper constraint, urging or persuasion to induce a decedent to dispose of her property in a manner that she would not have done if left to act freely," which can be very hard to detect. Who can tell if a client is really acting freely or not?
That's one reason it's important to watch for cases of undue influence as they wend through the courts. Last month, a ruling in a New York case indicated existing parameters for what can constitute undue influence — and it's good news for people trying to keep their elderly parents or their clients from being a victim of undue influence.
Lewis Wechsler had filed four similar wills leaving the bulk of his estate to the children of his first marriage, as well as some to his second wife, to whom he was married 32 years. Nevertheless, the second wife told the executor of Wechsler's estate that his will would not need to go through probate because all his assets had already been transferred to her. The court noted transactions made by Wechsler within six months prior to his death that essentially liquidated his estate.
The children claimed undue influence and a surrogate judge agreed to take on the case, which is not common in these instances. What caused the judge to do that? The existence of the prior wills, all of which included Wechsler's children, probably wouldn't have been enough, but there were other pieces of evidence.
A court's invalidation of a will based on undue influence requires several essential elements. First, the influence must be so overpowering that the decedent would have been unable to make a free decision alone.
Advising a client on how to dispose of an estate does not count as undue influence; the complainant must show that the client wasn't capable of resisting the changes.
Also, the person who is accused of undue influence must be the one benefiting from the will or estate plan in question. And it must be demonstrated that the client acted contrary to how he or she would have without the alleged influence.
