425 S.W.3d 8
Ark. Ct. App.2012Background
- Will is diagnosed with terminal cancer and signs a deed involving the Hankins farm shortly before death (March 2007).
- Willis and Sally Austin lived as companions for about 15 years; they were not married and had no children.
- Zelma Hankins deeded the Hankins farm to Willis in 1993; John Sr. and his sons later disputed matters of estate and ownership.
- On March 14, 2007, the deed to Sally was allegedly signed after Willis was urged by Sally; Knight notarized the deed that Willis allegedly signed.
- A check for $47,800 was signed by Willis and deposited March 16, 2007, with Bancorp South assisting in completing the instrument at Sally’s direction.
- The trial court found no clear and convincing evidence of incompetence or undue influence, and held Sally had authority to complete the check; the estate appealed the rulings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was the deed valid or forged and executed with Will’s capacity? | Hankins contends the deed was forged and Willis lacked capacity. | The trial court relied on Knight’s testimony and Willis’s capacity; Vastrick’s opinion was limited. | No clear error; deed valid despite expert contradicted by witness credibility. |
| Did Willis have sufficient mental capacity to execute the deed? | Estate argues insufficient capacity due to illness and medications. | Willis appeared lucid and capable; witnesses supported capacity. | Willis had sufficient mental capacity to execute the deed. |
| Was Sally unduly influencing Willis or acting with a confidential relationship to procure the deed? | Estate asserts undue influence and isolation of Willis from family. | Evidence shows family feud unrelated to Sally; no proven undue influence. | No clear error; estate failed to prove undue influence. |
| Did Sally have authority to complete the $47,800 check and is it an altered instrument? | Sally procured the check by manipulation; Knight failed to verify. | Sally had Will’s authority; the instrument was incomplete, not altered; Knight acted on instructions. | Sally had authority; instrument not altered. |
| Was Knight negligent or did Bancorp South owe duties to protect Willis? | Bankers failed to protect Willis from diversion of funds. | Willis was not a bank customer; bank duties do not extend in that way. | No reversible error; trial court did not clearly err. |
Key Cases Cited
- Looney v. Estate of Wade, 310 Ark. 708 (1992) (burden shifting not stated; applicable to proof standards in capacity/undue influence)
- Birch v. Coleman, 15 Ark.App. 215 (1985) (burden of proof in related context)
- Estate of McKasson v. Hamric, 70 Ark.App. 507 (2000) (mental capacity and instrument validity standard)
- Richard v. Smith, 235 Ark. 752 (1962) (test for mental capacity to execute an instrument)
- Carpenter v. Layne, 2010 Ark. App. 364 (2010) (credibility determinations valuable in conflicting testimony)
- Peoples Bank & Trust Co. of Van Buren v. Wallace, 290 Ark. 589 (1986) (preservation of issues and treatment of altered/incomplete instruments)
- Munzner v. Kushner, 375 S.W.3d 647 (Ark. App. 2010) (credibility and weight to witness testimony in equity review)