The Idaho Supreme Court finds a mother had testamentary capacity when she disinherited two stepchildren from the family trust because she felt they treated her poorly since their father’s death. In Gestner v Divine (Idaho, No. 48381, October 21, 2022).
Donald and Marjorie Woodfin each had two adult children when they married in 1997. Mr. Woodfin’s two children are Kathleen Gestner and Ray Woodfin. Mrs. Woodfin’s two children are Julie Divine and Colleen Shiras.
Mr. and Mrs. Woodfin created the Woodfin Family trust, a revocable trust, in 1999. The trust identified the primary beneficiaries as Mr. Ray Woodfin, Ms. Gestner, Ms. Shiras, and Ms. Divine. On the death of the surviving spouse, each beneficiary would receive $100,000 in equal shares. Any remaining assets of the trust were to be distributed to the four beneficiaries in equal shares.
Donald Woodfin died in 2000. Following her husband’s death, Mrs. Woodfin sold the home they had shared and sent checks of $93,656.19 to each of the four children.
After Mrs. Woodfin sold the home, Ms. Divine and her husband built a house on their property in California for Mrs. Woodfin to live in, rent-free. In 2009, the Divines moved to Idaho. Mrs. Woodfin sold her car and moved into a mobile home with her daughter Ms. Shiras until Ms. Shiras died in 2012. Mrs. Woodfin eventually moved into the Divines’ home and paid them $2,000 a month, plus $30 a month for her phone. In 2018, Mrs. Woodfin added Ms. Divine as a joint account holder to her bank account to handle her online banking and transfers.
Mrs. Woodfin amended the Trust several times after Mr. Woodfin died; in 2002, she included additional successor trustees. In 2007, she named Ms. Divine as successor trustee, with Ms. Shiras as successor if Ms. Divine was unable to serve. Ms. Gestner and Mr. Ray Woodfin were to be removed as primary beneficiaries following Mrs. Woodfin’s death. In 2010, Mrs. Woodfin designated her daughters as co-trustees and reduced her stepchildren’s special bequests from $200,000 to $100,000.
Mrs. Woodfin was diagnosed with breast cancer in Spring 2017. In August 2017, Ms. Shiras drove her mother to meet with attorney Robert Green regarding another trust amendment. Mrs. Woodfin explained to Mr. Green she felt her stepchildren treated her poorly and discussed with Mr. Green eliminating or reducing the special bequests to her stepchildren.
Mr. Green met with Mrs. Woodfin alone and had her complete a mental health capacity assessment that required him to determine whether Mrs. Woodfin had the mental capacity to proceed with the trust amendment. Mr. Green made detailed notes and concluded that Mrs. Woodfin was very capable of making her own decisions with a high degree of understanding: “Marjorie understands my potential concerns – but is insistent that she makes her own decisions and has other resources … that she can rely on.”
The 2017 trust amendments are not in the record, but Mr. Green testified Mrs. Woodfin did not disinherit or reduce the $100,000 distributions to her stepchildren at that time.
In May 2018, Ms. Divine again drove her mother to Mr. Green’s office to make further amendments to the Trust, eliminating Ms. Gestner and Mr. Ray Woodfin’s bequests and naming Ms. Divine as the sole beneficiary. Mr. Green met with Mrs. Woodfin alone and testified that he did not notice any change in her mental capacity and had reviewed her 2017 mental capacity worksheet prior to the meeting.
Mrs. Woodfin died in October 2018 at the age of 92. After learning of her death and that Ms. Divine was the sole beneficiary, Ms. Gestner and Mr. Ray Woodfin filed a complaint requesting the court declare the 2018 trust amendments void because of Ms. Divine’s undue influence and ordering her to distribute $100,000 to Mr. Ray Woodfin and $100,000 to Ms. Gestner.
Following a bench trial, the district court determined that the evidence “overwhelmingly supports the conclusion that Marjorie had full testamentary capacity when she amended the Trust.”
Ms. Gestner and Mr. Ray Woodfin appealed, arguing that the district court erred when it concluded that Mrs. Woodfin had testamentary capacity, that the 2018 Trust Amendment was the product of undue influence, and that Ms. Divine breached her fiduciary duties to them.
This Court review of the trial court’s conclusions following a bench trial is limited to determining whether the evidence supports the findings of fact and whether the findings of fact support the conclusions of law. A trial court’s factual findings are reviewed for clear error and will not be disturbed if the findings are “supported by substantial and competence evidence, even if there is conflicting evidence.”
The trial court’s conclusion that Mrs. Woodfin possessed testamentary capacity when she executed the 2018 Trust Amendment and that it was not a product of undue influence is supported by substantial and competent evidence. The district court relied on testimony from Mr. Green and his notes on the competency worksheet that is a tool that every estate planning attorney should use. The district court also considered testimony from Mrs. Woodfin’s family members, clergy, medical staff, and friends. A reasonable trier of fact would accept and rely on the evidence the trial court considered on making its findings of fact.
The district court also properly concluded that Ms. Gestner and Mr. Ray Woodfin failed to establish undue influence or that Ms. Divine breached her fiduciary duties to the beneficiaries of the Trust. The high court concludes that Ms. Gestner and Mr. Ray Woodfin waived this issue, because there is no indication in the record on appeal that they pleaded or argued a claim for breach of fiduciary duty before the district court.
For the foregoing reasons, the high court affirms the district court’s findings of facts and conclusions of law, and awards costs on appeal to Ms. Divine.
See the entire opinion.
Subscribe to the Knowledge Bank.
