A COUNTRY PLACE CONDOMINIUM ASSOCIATION VS. MAROECHEABDELHAK(DC-12065-14, OCEAN COUNTY AND STATEWIDE), A-0145-15T4

Background

Evelyn Worley (diagnosed with mild dementia in 2009) executed a POA in favor of Richard on Dec. 14, 2011; she later executed a Will in Jan. 2012 naming Richard executor. Prior documents (1993, 2008 Wills; 2005 POA) named Dwight for some roles.
In 1997 Evelyn opened a Transfer on Death (TOD) investment account at Waddell & Reed naming Dwight as sole beneficiary; the account remained in place and was unknown to other brothers until litigation.
After Evelyn was placed in an assisted living facility in Nov. 2011, she expressed a desire to return home and to have Richard act for her; Richard arranged the 2011 POA and removed her from the facility.
Dwight and Daniel challenged the 2011 POA as a product of Richard’s undue influence and sought guardianship of Evelyn and disclosure of financial changes; a consent order initially voided the 2011 POA and the 2012 Will and gave limited interim management roles.
At trial the court found (1) a presumption of undue influence arising from the confidential relationship and suspicious circumstances, (2) Richard rebutted that presumption as to the 2011 POA (POA valid), (3) Richard did not rebut as to the 2012 Will (Will invalid), (4) Richard appointed guardian of person and property, and (5) the judge reordered the TOD account beneficiary to split equally among the three sons.
The Appellate Division affirmed most holdings but reversed the re-designation of the TOD account, restoring Dwight as beneficiary; it also upheld exclusion of an undisclosed expert opinion and the limited awards of attorney fees.

Issues

Issue	Plaintiff's Argument (Dwight & Daniel)	Defendant's Argument (Richard)	Held
Validity of 2011 POA (undue influence)	POA procured by Richard's undue influence; presumption arises from confidential relationship and suspicious circumstances	Richard acted per Evelyn's wishes to remove her from facility; evidence shows she wanted Rick and had capacity to choose him	Court: presumption arose, burden shifted to Richard, who rebutted by clear and convincing evidence; POA valid
Validity of 2012 Will (undue influence)	Will changed executor to Richard without evidence Evelyn wanted that; undue influence not rebutted	Richard argued testamentary capacity and intent, but less evidence that Evelyn wanted executor changed	Court: presumption not rebutted; 2012 Will invalid
TOD account beneficiary re-designation	Plaintiffs argued Evelyn later wanted all sons treated equally; court should reform beneficiary to reflect probable intent	Richard (and Dwight) relied on unchallenged, competent 1997 TOD naming Dwight; no evidence of change of intent	Court of Appeals: trial court erred; insufficient evidence to change beneficiary; restored Dwight as beneficiary
Award of attorney fees	Plaintiffs sought fees from Richard for undue influence and defense of 2005 POA	Richard sought fees for defending the 2011 POA and under POA’s fee clause	Court: American Rule applies; no basis to shift full fees. Trial court acted within discretion in awarding modest symmetric fees and denying broader fee awards

Key Cases Cited

In re Estate of Stockdale, 196 N.J. 275 (presumption of undue influence where confidential relationship plus suspicious circumstances shifts burden)
Haynes v. First Nat'l State Bank, 87 N.J. 163 (same principle regarding burden shift)
Estate of Ostlund v. Ostlund, 391 N.J. Super. 390 (definition of confidential relationship)
Pascale v. Pascale, 113 N.J. 20 (parent-child as a natural confidential relationship)
In re Will of Rittenhouse, 19 N.J. 376 (requirement of additional suspicious circumstances)
In re Niles, 176 N.J. 282 (exception to American Rule for fees where fiduciary committed undue influence)
In re Estate of Vayda, 184 N.J. 115 (American Rule overview on shifting attorney fees)
Manalapan Realty, L.P. v. Twp. Comm., 140 N.J. 366 (de novo review for legal issues vs. deference to trial factfinding)