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COURT OF APPEALS
DECISION
DATED AND FILED
April 23, 2009
David
R. Schanker
Clerk of Court of Appeals
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NOTICE
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This opinion is subject to
further editing. If published, the
official version will appear in the bound volume of the Official
Reports.
A party may file with the
Supreme Court a petition to review an adverse decision by the Court of
Appeals. See Wis. Stat. § 808.10 and Rule 809.62.
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Appeal No.
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STATE OF WISCONSIN
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IN COURT OF
APPEALS
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DISTRICT I
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In the matter of the estate of Stanley
J. Fredericks:
Mary Ann Jezuit,
Plaintiff-Respondent-Cross-Appellant,
v.
Michael J. Fredericks , individually as Power of Attorney
for Stanley
J. Fredericks, Michael J. Fredericks ,
Personal Representative of the Estate of Stanley J.
Fredericks and William Fredericks,
Defendants-Appellants-Cross-Respondents.
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APPEAL
and CROSS-APPEAL from a judgment of the circuit court for Milwaukee County: michael
j. dwyer, Judge. Affirmed.
Before Higginbotham, P.J., Vergeront and Bridge, JJ.
¶1 PER CURIAM. Michael Fredericks
and his son, William Fredericks, appeal a judgment that awards Mary Ann Jezuit
$239,054.68 from Michael or the estate, and compels William to return a
dwelling to the estate. The judgment is
based on a jury finding that Stanley Fredericks was not competent and was
subject to Michael’s undue influence when he signed a quitclaim deed
transferring the residence to William.
The Fredericks
raise numerous issues on appeal. Jezuit
cross-appeals, arguing that she is entitled to punitive damages. We affirm the judgment.
BACKGROUND
¶2 Stanley’s
will bequeathed a residence to Jezuit.
However, approximately three weeks before he died, Stanley executed a quitclaim deed
transferring the residence to his grandson, William. Jezuit initially commenced this action as an
untimely claim against the estate. She
eventually amended her complaint to plead an objection to the inventory of the
estate under Wis. Stat. § 879.63
(2007-08)
and breach of fiduciary duty by Michael.
¶3 At trial, Jezuit presented evidence on Stanley’s competency to execute the deed. Dr. Shane Wernsing examined Stanley’s medical records and opined that he
was not competent. Stanley’s medical records indicate that on
the day he signed the quitclaim deed he was disoriented as to time.
¶4 Jezuit also presented evidence on the two-prong and
four-prong tests for undue influence.
The two-prong test requires proof of a confidential or fiduciary
relationship and the existence of suspicious circumstances. Malmar v. Stimac, 73 Wis.
2d 192, 202, 243 N.W.2d 435 (1976). The
four-prong test for undue influence requires proof of susceptibility,
opportunity to untimely influence, a disposition to influence, and a coveted
result. Id.
¶5 The court concluded as a matter of law that Stanley and
Michael had a fiduciary relationship because Michael possessed and recently
utilized a power of attorney with respect to Stanley.
Jezuit presented numerous witnesses to establish suspicious circumstances. Attorney Michael Tobin, Stanley’s longtime attorney, testified that he
felt pressured by Michael to prepare a transfer deed. Tobin refused. Michael then approached Attorney Gerald
Boisits to prepare the deed and, along with Michael’s wife and William, to
present the deed to Stanley
for his signature. Boisits had never
spoken to Stanley
before and had not reviewed his estate plan.
Stanley’s sisters testified to Stanley’s longstanding
intent that the real estate in question go to Jezuit, including a conversation
shortly before he went to the hospital.
Family members were discouraged by Michael’s wife from visiting Stanley in his last days,
ostensibly because he was allowed no visitors other than medical
personnel. Stanley’s sister testified that she later
found out that was not the case.
¶6 Regarding the four-prong test, Jezuit presented evidence from
Dr. Wernsing that Stanley
was susceptible to undue influence.
Williams’ opportunity to influence Stanley
was accomplished through the attorney he hired, Michael’s wife and his son, who
were the only people present when the deed was signed. The disposition to influence was shown by his
hiring of attorney Boisits and, through his wife, discouraging other relatives
from visiting Stanley. Finally, the coveted desired result consisted
of obtaining for his son, William, a residence valued at $140,000.
¶7 The jury also heard evidence of Michael’s use of an
eighteen-year-old power of attorney to cash in Stanley’s
annuity that had named Stanley’s
four sisters as beneficiaries. Michael
exercised his rights under the power of attorney even though he had not had any
contact with Stanley
for more than five years. The effect of
cashing in the annuity and depositing it in a money market account was that the
$140,000 proceeds would then flow through the estate where Michael was a
primary beneficiary, rather than going to Stanley’s sisters.
¶8 The Fredericks’ witnesses denied any wrongdoing and claimed Stanley was competent to
execute the deed. Dr. Robert Goldmann, Stanley’s physician, testified as a fact witness regarding
Stanley’s
physical health. He was not, however,
allowed to offer an opinion as an expert regarding Stanley’s mental condition
because Goldmann was not identified as an expert witness as required in the
scheduling order and because Goldmann did not profess to have expertise on that
question. The court also ruled that the dead
man’s statute, Wis. Stat. § 885.16,
disqualified William and Susan Fredericks from testifying regarding their
conversations with Stanley
before his death.
¶9 The jury found that Stanley
was not competent when he signed the deed.
It also found that suspicious circumstances were present in the transfer
and that Michael had not established that he did not unduly influence Stanley. The verdict also included findings that Stanley was susceptible to undue influence, Michael had an
opportunity to unduly influence Stanley, he had
the disposition to influence Stanley
and he achieved a desired result. The court
answered the verdict questions relating to Michael’s fiduciary relationship
with Stanley
and the amount of damages that would compensate Jezuit for the lost
property. The court entered an order for
judgment requiring William to return the property to the estate and requiring
the estate or Michael to pay Jezuit $239,054.68 in which damages consisted of
the value of the house plus attorney fees and costs.
DISCUSSION
¶10 The Fredericks first argue that the circuit court should have
granted their motion for summary judgment because Jezuit’s initial claim
against the estate was untimely. Jezuit
amended her complaint to plead an action under Wis. Stat. § 879.63.
That statute imposes no deadline for bringing an action to add property
to the inventory of an estate. Because Jezuit
abandoned her “claim against the estate,” her untimely filing of the initial
claim is irrelevant.
¶11 The Fredericks next argue that Jezuit should not have been
allowed to amend her complaint because they did not consent to the
amendment. However, their consent was
not necessary under Wis. Stat. § 802.09(1)
because the amendment was granted by leave of the court. In fact, the court suggested the filing of an
amended complaint. In addition, the Fredericks’ attorney
withdrew the parts of the motion for summary judgment regarding jurisdiction
and the statute of limitations.
¶12 The Fredericks also contend the remaining portion of the
summary judgment motion, dealing with the merits of the undue influence claim,
should have been granted. Summary
judgment is only appropriate if the supporting papers show there is no genuine
issue of material fact and the moving party is entitled to judgment as a matter
of law. See Wis. Stat. § 802.08(2). The Fredericks
argue that there was no evidence of suspicious circumstances, no evidence of
Michael’s opportunity to unduly influence Stanley,
and no evidence that Michael benefitted from the transfer of the property to
William. The same argument is repeated
under sections of their brief relating to a motion to dismiss at the close of
the plaintiff’s case, challenges to the jury instructions and verdict form, and
arguments relating to their posttrial motions.
The answer is the same as to each of these arguments. Jezuit presented sufficient evidence to
defeat summary judgment and to support the jury’s verdict.
¶13 The suspicious circumstances included Stanley’s abrupt decision to, in effect,
disinherit Jezuit despite statements he made before he went to the hospital. Michael’s decision to retain an attorney to
draft and present the quitclaim deed after Stanley’s
attorney refused, along with evidence that relatives were discouraged from
visiting Stanley,
constitute suspicious circumstances, particularly when coupled with Michael’s
actions regarding the annuity. Michael’s
opportunity to influence Stanley
was established despite their estrangement.
Michael’s selection of Attorney Boisits and the presence of his wife and
son adequately establish his opportunity to influence Stanley through others. The Fredericks
cite no authority for the proposition that the opportunity to influence the
testator does not include the activity of surrogates such as an attorney and
family members. Michael’s benefit from
the undue influence consisted of obtaining a free house for his son. Again, the Fredericks cite no authority for the
proposition that the undue influence must directly benefit the person providing
the influence rather than a close family member. To the contrary, the concept of a coveted
result includes obtaining for oneself or another a benefit that a person would
not normally receive. Becker
v. Zoschke, 76 Wis. 2d 336,
349, 251 N.W.2d 431 (1977).
¶14 The Fredericks next argue that Dr. Goldmann should have been
allowed to testify as an expert witness.
The court properly exercised its discretion when it limited Goldmann’s
testimony to exclude expert opinion testimony because the Fredericks failed to comply with the
scheduling order. In addition, Goldmann
testified in his deposition that he was not qualified to give an expert opinion
regarding Stanley’s
mental ability to execute legal documents.
¶15 The Fredericks next argue that the trial court improperly
exercised its discretion when it allowed testimony regarding Michael’s
liquidation of Stanley’s
annuity account. Jezuit’s amended
complaint alleged that Michael breached his fiduciary duty as personal
representative with regard to the annuity transaction. The trial court ultimately ruled that Jezuit
lacked standing to raise that issue.
However, Michael’s decision to liquidate the annuity account was
introduced as other acts evidence to show Michael’s motive, intent, opportunity
and preparation. See Wis. Stat.
§ 904.04(2). The evidence
was relevant to show suspicious circumstances, an element of the two-prong test
for undue influence. It was also
relevant to establish Michael’s disposition to unduly influence, which “implies
grasping and overreaching, and a willingness to do something wrong or
unfair.” Evans v. Krueger, 83 Wis.
2d 259, 282, 265 N.W.2d 529 (1978). The Fredericks did not
establish that introducing evidence regarding the annuity was substantially
more prejudicial than probative.
Therefore, under the test set out in State v. Sullivan, 216 Wis.
2d 768, 772, 576 N.W.2d 30 (1998), the court properly admitted the
evidence. The Fredericks
argue that liquidating the annuity was not a “prior bad act” because it
occurred three days after Stanley
signed the quitclaim deed. Nothing in Wis. Stat. § 904.04(2) requires
that the other crime, wrong or bad act precede the charged offense.
¶16 The Fredericks next argue that they were prejudiced by the
court’s refusal to allow William and Susan to testify regarding their
conversations with Stanley. However, they do not identify any specific
error in the court’s enforcement of Wis.
Stat. § 885.16, the dead man’s statute. The core meaning of the statute is that “it
disqualifies a witness to a transaction or communication with a decedent from
testifying about that transaction or communication in his or her favor, or in
favor of any party to the case claiming under the witness.” Bell v. Neugart, 2002 WI App 180,
¶17, 256 Wis. 2d 969, 650 N.W.2d 52. The Fredericks
offer no specific argument that the dead man’s statute did not apply.
¶17 The Fredericks next argue that the court utilized a misleading,
confusing and highly prejudicial special verdict. They argue that the court improperly shifted
the burden of proof on question number 8:
“Has Michael Fredericks shown that he did not unduly influence Stanley
Fredericks?” The court did not
improperly instruct the jury on this question.
Under the two-prong test for undue influence, upon proof of a confidential
or fiduciary relationship and suspicious circumstances, a rebuttable
presumption of undue influence is raised.
See Lee v. Kamesar, 81 Wis. 2d 151,
164, 259 N.W.2d 733 (1977). The court
answered the second verdict question concluding as a matter of law that Stanley
and Michael had a fiduciary relationship.
The jury answered the third question, finding suspicious circumstances
were present in the transfer of the real estate. Therefore, a rebuttal of presumption of undue
influence was created and the court appropriately required Michael to rebut the
presumption. Although the court did not
use the term “rebuttable presumption” in the jury instruction, the effect of
requiring Michael to overcome the presumption correctly states the law. As to all other questions, the court
appropriately instructed the jury that Jezuit had the burden of proof.
¶18 The Fredericks also argue that the special verdict should not
have included question nine: “What sum of
money will fairly and reasonably compensate Mary Ann Jezuit for her
damages?” That question was answered by
the court. The Fredericks argue that the jury should not
have been exposed to the question because it raised an inference that Jezuit was
damaged. No objection to question number
nine was raised in the jury instruction and verdict conference. Therefore, the objection was waived. See Wis. Stat. § 805.13(3).
¶19 The Fredericks also argue that judgment against William was not
appropriate because none of the verdict questions mention William. William is a party to this action because he
was the title holder to the property Jezuit sought to return to the inventory
of the estate. As the beneficiary of
Michael’s wrongdoing, William is an appropriate party even though none of the
allegations directly involved William.
The Fredericks
cite no authority for the proposition that William must be included in the
verdict before he can be ordered to return property to the estate.
¶20 The Fredericks next argue that the court should have read
Wisconsin Civil Jury Instruction 352 regarding the presumption of Stanley’s competency. The court did instruct the jury that a person
is presumed to have sufficient competency to sign a deed and transfer
property. We conclude that the
instruction given adequately informed the jury of the presumption of
competency.
¶21 The Fredericks next argue that the order for judgment and
judgment are ambiguous and confusing.
They argue that Jezuit is entitled to the residence, not the cash value
of the residence under the terms of the will.
The order for judgment and the transcript of the posttrial hearing allow
a $140,000 credit against the total amount of the judgment if the estate
transferred the residence to Jezuit.
There is no double counting of the value of the house. If the Fredericks
elect to retain the house, they are not aggrieved by that choice.
¶22 The Fredericks also challenge the portion of the order for
judgment that allows recovery of future attorney fees for the cost of defending
the verdict on appeal. They argue that
the award of attorney fees is not allowed under Wis. Stat. Rule 809.25.
The circuit court awarded the future attorney fees pursuant to Wis. Stat. §§ 879.33, 879.37 and
879.63. The Fredericks do not argue the applicability of
those statutes. Therefore, we will not
address the issue. See State v. Allen, 2004 WI 106, ¶26 n.8,
274 Wis. 2d
568, 682 N.W.2d 433 (issue not argued is waived). The Fredericks also complain that the order for
judgment required the return of all early distributions by November 17, 2006,
one month before the order for judgment was signed. They do not identify any penalty that was
imposed for violating the order. They do
not argue that the court exceeded its authority to preserve the assets of the
estate. We conclude the issue is not
adequately briefed to establish that the Fredericks
are aggrieved by the discrepancy.
¶23 Finally, the Fredericks
request a new trial in the interest of justice.
They repeat arguments already considered and rejected by this
court. We conclude that the merits were
fully and fairly tried, justice has not miscarried, and there is little
likelihood that retrial would result in a different verdict. See State v. Darcy N.K., 218 Wis.
2d 640, 667-68, 581 N.W.2d 567 (Ct. App.
1998).
¶24 In her cross-appeal, Jezuit argues that the trial court
improperly exercised its discretion by not presenting the issue of punitive
damages to the jury. Punitive damages
are available only when the conduct is sufficiently aggravated. Strenke v. Hogner, 2005 WI 25, ¶38,
279 Wis.
2d 52, 694 N.W.2d 296. In Strenke,
the court noted that “not every drunk driving case will give rise to punitive
damages. Only when the conduct is so
aggravated that it meets the elevated standard of an ‘intentional disregard of
rights’ should a circuit court send the issue to a jury.” Id.,
¶42. In this case, Fredericks’ undue influence is not distinguishable
from any other undue influence case. We
agree with the circuit court that Fredericks’
actions as found by the jury are not sufficiently egregious to warrant punitive
damages.
By the
Court.—Judgment affirmed.
This opinion will not be published. See Wis.
Stat. Rule 809.23(1)(b)5.