Charles named his sister, Jennifer, as primary beneficiary of his IRA and bank accounts since she was his nearest living relative. However, three years prior to his death, Charles changed these designations to name Becky, his daily caregiver for the past ten years. Charles had multiple medical conditions rendering him unable to drive, which Becky did for him. Becky was so close to Charles that she even spent holidays and celebrated birthdays with the family. Jennifer believes Becky persuaded Charles to name her as beneficiary. What can Jennifer do?

As independent executor of her brother’s will, Jennifer can file suit against the Becky to set aside the designations on the basis that she exerted undue influence on Charles in making them. Jennifer would have to prove: (1) the existence and assertion of the undue influence; (2) the influence subverted or overpowered Charles’ mind at the time he executed the designations; and (3) Charles would not have named Becky as beneficiary but for her undue influence.

The outcomes of cases which claim undue influence depend upon the facts. Jennifer believes she has a strong case because Becky drove Charles to the bank to make the changes. Furthermore, he made the changes from the car in the bank’s parking lot with Becky in the car with him. In addition, Becky, who was Charles’ agent on his financial power of attorney, had transferred $20,000.00 from Charles’ account into her own savings account.

Whether Jennifer wins her suit will depend upon the existence of facts contrary to her claim of undue influence. In a case with facts similar to Jennifer’s, a Texas Court of Appeals found no undue influence where testimony of the bank employees dealing with the decedent and his accounts revealed that: (1) the decedent had been in charge of and knowledgeable about his investments and his accounts; (2) the employee had seen no evidence of undue influence by the caregiver; (4) the decedent displayed no evidence of dementia or any other mental incapacity; (5) the decedent had mentioned that, although he would have liked to have helped out his nephew, he didn’t think leaving him any money would help him because he had a drug problem; and (6) decedent had said he had removed Jennifer as prior primary beneficiary because he believed she wasn’t going to live much longer.  

Sandra W. Reed is an attorney with Katten & Benson, an Elder Law firm in Fort Worth. She lives in beautiful Somervell County, near Chalk Mountain.