Opinion ID: 901464
Heading Depth: 1
Heading Rank: 6

Heading: Was Instruction 17 a misstatement of the law and therefore erroneous?

Text: [¶25.] Mollers first argue that Instruction 17 removed a question of fact from consideration by the jury. They assert that the trial court erred in instructing the jury that, because of the power of attorney, a confidential relationship did exist at the time of the execution of the April 10, 2002 will. [¶26.] Under our settled law: [a] fiduciary relationship is founded on a 'peculiar confidence' and trust placed by one individual in the integrity and faithfulness of another. When such relationship exists, the fiduciary has a 'duty to act primarily for the benefit' of the other. 'Generally, in a fiduciary relationship, the property, interest or authority of the other is placed in the charge of the fiduciary.' Ward v. Lange, 1996 SD 113, ¶12, 553 NW2d 246, 250 (citing High Plains Genetics Research, Inc. v. JK Mill-Iron Ranch, 535 NW2d 839, 842 (SD 1995)) (citations omitted). The existence of a fiduciary duty and the scope of that duty are questions of law for the court. Id. Therefore, in South Dakota, as a matter of law, a fiduciary relationship exists whenever a power of attorney is created. [¶27.] This Court has held that a confidential relationship is generally synonymous with a fiduciary relationship. Buxel v. First Fidelity Bank, 1999 SD 126, ¶14, 601 NW2d 593, 597 (citing Crane v. Centerre Bank of Columbia, 691 SW2d 423, 428 (MoCtApp 1985)) (citation omitted). Furthermore, a confidential relationship is not restricted to any particular association of persons. Hyde v. Hyde, 78 SD 176, 186, 99 NW2d 788, 793 (1959). A confidential relationship exists whenever a decedent has placed trust and confidence in the integrity and fidelity of another. In the Matter of Estate of Unke, 1998 SD 94, ¶16, 583 NW2d 145, 148 (citing In re Estate of Madsen, 535 NW2d 888, 892 (SD 1995)) (citations and internal quotations omitted). [¶28.] It is undisputed that the Mollers were in a fiduciary relationship as of March 30, 2002, as a result of the execution of the power of attorney by Duebendorfer. In addition and equally important, both Randy and Kathy individually admitted at trial that from March 30, 2002, until Duebendorfer's death, each was in a confidential and fiduciary relationship with Duebendorfer. Kathy testified: Q: You agree also that you were in a confidential and fiduciary relationship with Kenneth once the power of attorney was executed in your favor on March 30, 2002? A: Correct. Randy testified: Q: And you agree that from that time on, March 30, 2002, you were in a confidential and fiduciary relationship with Kenneth? A: Yes, I was. Mollers cannot claim a version of the facts more favorable than that to which they testified at trial. See Overfield v. American Underwriters Life Ins. Co., 2000 SD 98, ¶19, 614 NW2d 814, 819; Western States Land & Cattle Co., Inc. v. Lexington Ins. Co., 459 NW2d 429, 434 (SD 1990). Therefore, because Mollers admit they were in a confidential and fiduciary relationship with Duebendorfer (and they clearly were), it was not error for the trial court to instruct the jury, as a matter of law, such a confidential relationship existed. [¶29.] Because the trial court did not error in instructing the jury that a confidential relationship existed, we next address Mollers' second claim of error; that the trial court improperly instructed the jury regarding the burden of proof of undue influence. Mollers assert that the trial court erred in instructing that the burden of proof shifted to them. They argue that only the burden of going forward with the evidence shifted to them. [¶30.] The relative burdens of the parties in contested will cases are set forth by statute. SDCL 29A-3-407 provides: In contested cases, petitioners who seek to establish intestacy have the burden of establishing prima facie proof of death, venue, and heirship. Proponents of a will have the burden of establishing prima facie proof of due execution in all cases, and, if they are also petitioners, prima facie proof of death and venue. Contestants of a will have the burden of establishing lack of testamentary intent or capacity, undue influence, fraud, duress, mistake, or revocation. Parties have the ultimate burden of persuasion as to matters with respect to which they have the initial burden of proof. If a will is opposed by the petition for probate of a later will revoking the former, it shall be determined first whether the later will is entitled to probate. If a will is opposed by a petition for a declaration of intestacy, it shall be determined first whether the will is entitled to probate. (emphasis added). This statute clearly indicates that the party with the initial burden of proof has the ultimate burden of persuasion. Thus, the proponents of the will, Mollers, had the ultimate burden of persuasion as to the due execution of the will. That burden does not shift, but remains with them. Conversely, the contestants have the ultimate burden of persuasion to establish undue influence. [¶31.] Under this Court's settled law, to establish the existence of undue influence a will contestant must prove four elements by a preponderance of the evidence: '(1) decedent's susceptibility to undue influence; (2) opportunity to exert such influence and effect the wrongful purpose; (3) a disposition to do so for an improper purpose; and (4) a result clearly showing the effects of undue influence.' Estate of Dokken, 2000 SD 9, ¶27, 604 NW2d 487, 495 (quoting Unke, 1998 SD 94, ¶12, 583 NW2d at 148 (citing In re Estate of Elliott, 537 NW2d 660, 662-63 (SD 1995))). [¶32.] A presumption of undue influence arises 'when there is a confidential relationship between the testator and a beneficiary who actively participates in preparation and execution of the will and unduly profits therefrom.' Id. ¶28 (citing Unke, 1998 SD 94, ¶13, 583 NW2d at 148 (quoting Madsen, 535 NW2d at 892)). When this presumption arises, the burden shifts to the beneficiary to show he took no unfair advantage of the decedent. Id. (citing Unke, 1998 SD 94, ¶ 13, 583 NW2d at 148 (citing In re Estate of Metz, 78 SD 212, 222, 100 NW2d 393, 398 (1960))). In addition, [t]he finding of a confidential relationship shifts the burden to [the beneficiary] to show by a preponderance of the evidence that [he/]she took no unfair advantage of [the decedent] in the creation of the will[.] In re Estate of Smith ( Smith II ), 520 NW2d 80, 83 (SD 1994) (citing In re Estate of Smith ( Smith I ), 481 NW2d 471, 475 (SD 1992)). [6] However, the burden of going forward with the evidence in an undue influence case does not shift to the beneficiary unless a presumption of undue influence is established. Dokken, 2000 SD 9, ¶28, 604 NW2d at 495 (citing Unke, 1998 SD 94, ¶13, 583 NW2d at 148) (emphasis omitted). [¶33.] Instruction 17 instructed the jury that because a confidential relationship existed, Mollers must show they took no unfair advantage of Duebendorfer in the preparation and execution of his will. Id. Instruction 17 further instructed: if you find that the Mollers actively participated in the preparation and execution of the will and that they unduly profited there from, then a presumption of undue influence arises. When this presumption of undue influence arises, the burden of proof shifts to the Mollers to show that they took no unfair advantage of Kenneth Thomas Duebendorfer in the creation of the will in order to rebut or defeat a finding that undue influence exists. This instruction allowed the jury to determine, 1) whether the contestants had established that Mollers had actively participated in the preparation and execution of the will, and 2) whether they unduly profited from their actions. It was only after making these two findings that the jury was instructed a presumption of undue influence was established. As per the holdings of Dokken, Unke, and Smith II, the burden then shifted to Mollers to rebut this presumption. [¶34.] The jury was then further instructed that if they found Mollers did not rebut this presumption, they were to check yes on the special verdict form. However, if the jury determined that either 1) Mollers did not actively participate in the preparation and execution of the will, or 2) did not unduly profit from it, i.e. they rebutted the presumption, the jury were then instructed that the contestants have the burden of proving the four elements set forth in Instruction No. 16 in order to establish that the will was the result of the undue influence of the Mollers. Thus, the ultimate burden remain[ed] on the person contesting the will to prove the elements of undue influence by a preponderance of the evidence. Unke, 1998 SD 94, ¶13, 583 NW2d at 148 (citing Madsen, 535 NW2d at 893). [¶35.] Therefore, based on the forgoing, Instruction 17, as a whole, correctly states the law on undue influence and the shifting burden. As Instruction 17 was not a misstatement of law, this Court does not need to address whether the instruction was prejudicial. [¶36.] Affirmed. [¶37.] GILBERTSON, Chief Justice, and KONENKAMP and MEIERHENRY, Justices, concur. [¶38.] ZINTER, Justice, concurs in part and concurs in result. [¶39.] MILLER, Retired Justice, sitting for SABERS, Justice, disqualified.