Opinion ID: 1168618
Heading Depth: 2
Heading Rank: 2

Heading: Agreement by Heirs

Text: Objectors argue that the court erred in determining that the heirs entered into an agreement to settle their claims against the estate. Objectors further argue that the executor, who was one of the heirs, violated his fiduciary duty to the other two heirs in obtaining their signatures on the agreement. The executor had a number of personal unfiled claims against the estate. In consideration for giving up these claims, he had agreements, as to the distribution of the residue of the estate, prepared and signed by the objectors and himself. The executor was to receive $56,000 and the objectors $6,000 each under the agreement. Hal Hamilton claims that, because of his history of alcoholism, he does not know if he signed the agreement or where or why he signed it. Evelyn Aikens claims that she signed the agreement only because the executor threatened and intimidated her. They both also allege fraud against the executor in obtaining their signatures. The trial court correctly found no fraud by the executor. The transcript shows no evidence of fraud in obtaining the signatures of the other heirs. However, the court erred in finding that the executor did not exercise undue influence over Hal Hamilton and Evelyn Aikens and that he did not abuse his fiduciary relationship in regard to the objectors. When a transaction between an executor and the beneficiaries under a will is called into question, the executor has the burden of showing that he acted in good faith. See Woodson v. Raynolds, 42 N.M. 161, 76 P.2d 34 (1938). Undue influence will be presumed when the fiduciary exercises a strong dominate relationship and thereby obtains benefits for himself against the interest of the beneficiaries. See Galvan v. Miller, 79 N.M. 540, 445 P.2d 961 (1968). The transcript in this case is replete with evidence of the executor's total domination of the objectors in the handling of the estate. He handled it as if it were his own property. In addition, he did not even advise the objectors of the fact that all of the claims that he purportedly had against the estate were barred by Section 31-8-3, N.M.S.A. 1953, because they had not been filed in time. Nor could the executor explain how he determined the sum of $56,000 for his unfiled claims or show documentation to support the alleged claims. The executor occupied a strong dominant position in this relationship; therefore, it is proper to presume the existence of undue influence. Galvan v. Miller, supra. After reviewing the entire transcript, we hold that the trial court's finding was contrary to the evidence and cannot be supported. The agreement was obtained by the exercise of undue influence and cannot stand.