950 N.W.2d 401
N.D.2020Background
- Ruth and Carl Finstrom executed identical wills in 2011; Carl died in 2011. Ruth later executed a contract for deed (Dec. 2012) conveying three quarters of farmland to Daniel and Teresa Finstrom for $240,000, and a new will in July 2015 dividing her residue equally among her seven children.
- Several children disputed the transfers and wills after Ruth’s death in Dec. 2016; informal probate of the 2015 will followed and litigation ensued among siblings, with Heartland Trust Company ultimately appointed personal representative.
- James Finstrom sued to invalidate Ruth’s conveyances to Daniel & Teresa for undue influence and brought other fiduciary claims; Daniel & Teresa counterclaimed. Joel Finstrom separately claimed a one‑third interest in a quarter section (allegedly paid for earlier) and sought payment for caregiving.
- A two‑day bench trial in Jan. 2019 resolved undue‑influence, trust, capacity, and property interest claims; the district court upheld the 2015 will, found no undue influence or confidential relationship, denied Joel’s property interest, and validated the 2012 conveyances.
- Post‑trial motions sought allowance of Joel’s claim for property and care and formal probate of the 2011 will; the court denied property claims as already decided (res judicata), allowed Joel $6,000 for caregiving, and denied formal probate of the 2011 will.
- Siblings Joel, James, and Annette appealed various adverse rulings; the North Dakota Supreme Court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Undue influence / confidential relationship (conveyance to Daniel & Teresa) | James: Daniel & Teresa unduly influenced Ruth; sale was far below market so presumption of undue influence | Daniel & Teresa: Ruth approached them; contract drafted in Ruth’s favor; attorney present; no confidential relationship | No confidential relationship; no undue influence. Court’s factual findings supported. |
| Unjust enrichment (Daniel & Teresa) | James: Daniel & Teresa were unjustly enriched by receiving land for inadequate payment | Daniel & Teresa: An express written contract existed; parties performed and parents received benefits from decades of labor and payouts | No unjust enrichment. Express contract covered the subject matter and court credited evidence of benefit to Carl/Ruth. |
| Admissibility of parol evidence re oral agreements before contract for deed | James: Parol evidence of prior oral agreements should be excluded under statute of frauds | Daniel & Teresa: Oral testimony explains inducement and circumstances, not to vary written contract | Parol evidence was admissible to explain inducement and circumstances but not to add or vary the written contract. |
| Joel’s property claim, alleged trust, subject‑matter jurisdiction / res judicata; Hauser’s formal‑probate petition | Joel: Claim to one‑third interest and trust not properly tried; 2011 will created a trust; later disallowed without due process | Personal rep. & others: Joel’s claim was filed and expressly consented to be tried; no express or implied trust proven; issues litigated at trial so res judicata bars relitigation | Joel’s claim was tried by consent; no express or implied trust established; res judicata bars reassertion of property claim; court allowed $6,000 for caregiving. Hauser’s petition for formal probate of 2011 will barred by res judicata. |
Key Cases Cited
- Nelson v. Nelson, 2018 ND 212, 917 N.W.2d 479 (defines undue influence and standards for nontestamentary transactions)
- Erickson v. Olsen, 2014 ND 66, 844 N.W.2d 585 (undue influence framework cited)
- Vig v. Swenson, 2017 ND 285, 904 N.W.2d 489 (clear‑error review and credibility findings in bench trials)
- Estate of Bartelson, 2015 ND 147, 864 N.W.2d 441 (confidential‑relationship principles and presumption of undue influence)
- Johnson v. Johnson, 85 N.W.2d 211 (parental favoritism or gifting to a child does not itself create undue influence)
- Broten v. Broten, 2017 ND 47, 890 N.W.2d 847 (unjust enrichment doctrine and standard of review)
- Ritter, Laber & Assocs., Inc. v. Koch Oil, Inc., 2004 ND 117, 680 N.W.2d 634 (express contract precludes unjust enrichment claim on same subject)
- Zitzow v. Diederich, 337 N.W.2d 799 (parol evidence may not vary written contract but may explain terms)
- Citizens State Bank‑Midwest v. Symington, 2010 ND 56, 780 N.W.2d 676 (parol evidence admissible to show inducement)
- Albrecht v. Metro Area Ambulance, 1998 ND 132, 580 N.W.2d 583 (subject‑matter vs. personal jurisdiction principles)
- SolarBee, Inc. v. Walker, 2013 ND 110, 833 N.W.2d 422 (N.D.R.Civ.P. 15(b) implied amendment by consent to try unpleaded issues)
- Estate of Binder, 386 N.W.2d 910 (trust‑creation standards; express trusts require writing)
- Spagnolia v. Monasky, 2003 ND 65, 660 N.W.2d 223 (resulting and constructive trusts; clear and convincing evidence required)
- Estate of Wagner, 551 N.W.2d 292 (testamentary capacity standard)
- Fredericks v. Vogel Law Firm, 2020 ND 171, 946 N.W.2d 507 (res judicata principles)
- Estate of Ketterling, 515 N.W.2d 158 (effect of informal probate and when formal proceedings bind interested persons)