Kase v. French Case Brief

Summary of Kase v. French
S Ct S D 325 NW 2d 678 [1982]

Avoidance of the K: Undue Influence

Relevant Facts: Adm of Mrs McWilliams estate brought action against Df French. McWilliams, in her 80’s had a 4thgrade edu and no business experience, but mentally competent lived on her own and was assisted by her nephew. Dfs bought a small grocery store and made deliveries. Df in delivering to Williams found that she had been injured in a fall. A mo later Dfs agreed to take care of her until she died. McWilliams later agreed to sell her house and property to Dfs for $35K. Upon consultation w/ her atty the deed was executed and she lived in an apartment w/i the house rent free for over two yrs.

Legal Issue(s): Whether undue influence was shown in securing K for R Prop through deed by purchasers despite existence of confidential relation btwn the K’ing parties?

Court’s Holding: NO

Procedure: Tr Ct upheld the validity of the deed; Pl appealed; S. Ct S D Affirmed.

Law or Rule(s): A confidential relationship exists btwn two people when one has gained the confidence of the other AND purports to act or advise w/ the other’s interests in mind. This requires that the Dominant party exercise good faith and to refrain from obtaining any advantage at the expense of the confiding party.

Court Rationale: The B o’ P never shifts from the one claiming undue influence, but the B o’ P does transfer to the other side when evidence shows a relationship of trust and confidence. The Dfs had duty to go forward w/ evidence and in fact went forward w/ evidence showing that the transaction was free from undue influence. The indica of undue influence are : person susceptible to undue influence, opportunity to exert undue influence and effect wrongful purpose, disposition to do so for improper purpose, and result clearly showing effect of undue influence. Mrs McWilliams was at all times mentally alert, able to care for herself, and in good health. The K shows the absence of undue influence. McWilliams lived in the home w/ Dfs rent free for over two yrs. Upon her entering a nursing home Df signed a financial responsibility agreement for her care. The presence of independent legal advice is an important factor. Mrs McWilliams engaged her atty of some yrs to draft the Deed.

Plaintiff’s Argument: Mrs Williams received independent legal advice before entering into contract and that contract permitted her to live rent free in apartment w/i house for two years.

Defendant’s Argument: The Dfs placed themselves in a fiduciary relationship w/ McWilliam and then abused that relationship by securing her property thereafter.

DISSENT: Shortly after establishing a relationship w/ the deceased, the Dfs retained her confidence. The Dfs did not act in G. F. For the benefit of McWilliams. A transaction w/o which is fraudulent and voidable which said presumption was not overcome by the Dfs.

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