What Constitutes Undue Influence Sufficient to Challenge a Trust in Florida?
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Trusts are an increasingly popular estate planning vehicle by which estate assets can be administered and distributed outside of probate court, often in place of more traditional wills. Like with wills, there can be disputes about the terms of the trust when a trust is created or changes are made late in the trust settlor’s life and the result is a significant change in favor of a particular beneficiary of the trust to the detriment of other beneficiaries or potential beneficiaries.
At times, there may be concerns raised in such situations regarding whether a new beneficiary or a beneficiary with a substantially increased share, may have exerted undue influence over the now-deceased trust settlor to cause the trust to be created or changed. In fact, the Florida Trust Code provides in section 736.0406, Florida Statutes, that: “If the creation, amendment, or restatement of a trust is procured by fraud, duress, mistake, or undue influence, the trust or any part so procured is void.” But what does “undue influence” actually mean under Florida law? And, what is necessary to prove that a trust or trust provision was procured by undue influence so as to successfully challenge the trust?
What is Undue Influence?
Undue influence sufficient under the law to challenge and overcome a trust is the same as for a will challenge and requires proving that the mind of the settlor of the trust was so controlled by persuasion, pressure, and outside influences that he or she did not act voluntarily but was subject to the will of another when execution of the trust took place. See In re Carpenter’s Estate, 239 So. 2d 506 (Fla. 4th DCA 1970), aff’d in part, remanded in part, 253 So. 2d 697 (Fla. 1971). “Mere affection, kindness or attachment of one person for another may not of itself constitute undue influence. Rather, it is conduct which must amount to overpersuasion, duress, force, coercion, or artful or fraudulent contrivances to such a degree that there is destruction of the free agency and will power of the one making the will [or trust].” Id. at 508.
What is Needed to Prove Undue Influence?
Because undue influence often occurs in private and confidential moments, and the issue is most often raised after the settlor of the trust is deceased, it can be very difficult to prove undue influence with direct evidence. For this reason, Florida law provides for a presumption of undue influence if certain factors can be met.
In general, a presumption of undue influence arises upon a showing that: (1) one having a substantial benefit under the will or trust; (2) possessed a confidential relationship with the decedent and (3) was active in the procurement of the will. In re Estate of Carpenter, 253 So. 2d 697 (Fla. 1971). In the Carpenter case, the Florida Supreme Court laid out the following nonexclusive factors that, if present, may show a presumption of undue influence regarding a will:
- Presence of the beneficiary at the execution of the will;
- Presence of the beneficiary on those occasions when the testator expressed a desire to make a will;
- Recommendation by the beneficiary of an attorney to draw the will;
- Knowledge of the contents of the will by the beneficiary prior to execution;
- Giving of instructions on preparation of the will by the beneficiary to the attorney drawing the will;
- Securing of witnesses to the will by the beneficiary; and
- Safekeeping of the will by the beneficiary subsequent to execution.
Id. at 702. These Carpenter factors apply equally to the presumption of undue influence regarding a trust. See Gorman v. Harrison, 599 So. 2d 643 (Fla. 3d DCA 1990).
Not all of the factors are required to be proven to establish active procurement by the beneficiary sufficient to raise the presumption, and the Carpenter court noted that “it will be the rare case in which all of the criteria will be present.” Id. Another factor that has been recognized since Carpenter is if there is an inequality of mental capacity and strength between the decedent and the party with the confidential relationship. See Hack v. Est. of Helling, 811 So. 2d 822, 826 (Fla. 5th DCA 2002).
Once the presumption of undue influence is established, then undue influence is presumed to have occurred, and the burden of proof shifts to the proponent of the trust or will to prove the nonexistence of the presumed fact of undue influence. See RBC Ministries v. Tompkins, 974 So. 2d 569, 572 (Fla. 5th DCA 2008) (“Accordingly, once a will contestant establishes the existence of the basis for the rebuttable presumption of undue influence, the burden of proof shifts to the proponent of the will to establish by a preponderance of the evidence the nonexistence of undue influence.”). This is because a “presumption of undue influence implements public policy against abuse of fiduciary or confidential relationships and is therefore a presumption shifting the burden of proof.” Fla. Stat. § 733.107(2).
A Florida trust can be challenged, in whole or in part, on the basis of undue influence, but only if it can be established that the settlor of the trust was influenced to such an extent that he or she was acting under the will of another. Because of the difficulty in proving undue influence with direct evidence, Florida law provides for a presumption of undue influence, if sufficient factors supporting undue influence can be proven. Once this presumption of undue influence is established, then the burden shifts to the beneficiary to disprove the presumption, due to Florida’s public policy against abuse of fiduciary or confidential relationships.