A California appeals court rules that principles of collateral estoppel prevent a conservatee's son from suing his sister for undue influence following their father's death when the son had already been disinherited by an earlier uncontested substituted judgment order. Murphy v. Murphy (Ca.App., No. A115177, June 26, 2008 modified July 22, 2008).
In June 2001, an independent conservator was appointed for the estate of William Murphy, who had recently suffered a stroke. Mr. Murphy's two children, William, Jr., and Maureen, had a history of conflict, and William, Jr., brought the petition for conservatorship out of concern that his sister was improperly influencing their father. Prior to the appointment of the conservator, Mr. Murphy had executed a holographic will and living trust that revoked his estate planning instruments and left all his property to Maureen.
In December 2002, Mr. Murphy filed a petition for substituted judgment requesting both court confirmation of his trust and court approval of the transfer of his assets into the trust. William, Jr., raised no objection to the petition, which was approved. After Mr. Murphy died in 2004, William, Jr., sued his sister, alleging, among other charges, fraud and undue influence pertaining to the transfer of Mr. Murphy's assets into the trust. Maureen argued that collateral estoppel prevented the lawsuit since the issues had already been litigated when the court approved Mr. Murphy's petition for substituted judgment. The trial court ruled in favor of William, Jr., and Maureen appealed.
In a case of first impression, the Court of Appeal of California, First District, overturns the trial court, finding that collateral estoppel applies. The court reasons that all of the claims raised in William, Jr.'s complaint could have been raised when Mr. Murphy presented his petition for substituted judgment. Furthermore, there are no due process concerns if collateral estoppel is applied because William, Jr., was given notice and an opportunity to present evidence at the hearing on the substituted judgment petition.
For the full text of this decision, go to: https://www.courtinfo.ca.gov/opinions/documents/A115177.PDF and https://www.courtinfo.ca.gov/opinions/documents/A115177M.PDF
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