Leach, E. v. Davis, P. ( 2018 )

J-A20021-17
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
ERICA FLEAGLE LEACH : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
PEGGY A. DAVIS :
:
Appellant : No. 81 MDA 2017
Appeal from the Judgment Entered April 10, 2017
In the Court of Common Pleas of Franklin County
Civil Division at No(s): 2011-00437
BEFORE: GANTMAN, P.J., PANELLA, J., and FORD ELLIOTT, P.J.E.
MEMORANDUM BY PANELLA, J. FILED FEBRUARY 13, 2018
Two months before his death in 2010, Ira Fleagle deeded his 1101 acre
farm to his daughter, Appellant Peggy Davis. Shortly after his death,
Appellee Erica Leach, Fleagle’s granddaughter and only other surviving
intestate heir, filed an action to invalidate the transfer of the farm to Davis
under several legal theories. After a remand from this Court, the orphans’
court, sitting as fact-finder, entered a verdict in Leach’s favor. On appeal,
Davis argues the orphans’ court erred in finding she had unduly influenced
Fleagle to transfer the farm to her for nominal consideration. We affirm.
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1 The record contains references to the farm being either 110, 125, or 137
acres. As a previous panel of this Court noted, the parties to this action
appear to agree on 110 acres.
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The facts of this case are largely undisputed. After a divorce, Davis
and her sons moved in with Fleagle in 1978. At some point in the 1980s, she
took over the management of Fleagle’s finances, and provided him with a
monthly allowance. Davis kept Fleagle’s money in a joint account and was
responsible for paying Fleagle’s bills.
Fleagle was semi-literate. He could read and understand
advertisements related to farming, but little else. He did not or could not
read a book.
After his wife died, Fleagle began a relationship with Mary Hoover. As
the relationship progressed, Fleagle would stay in his home with Davis
during the week, but would spend weekends with Hoover in her home. In
2004, he moved into Hoover’s home exclusively. There he remained until his
death in 2010.
Fleagle’s relationship with Hoover and his living arrangements had no
impact on Davis’s duties managing his finances. She continued to maintain
the joint account and pay his bills while providing him with a monthly
allowance.
Fleagle was hospitalized for a heart attack in October 2010. Hospital
staff informed Davis that Fleagle would be transferred to a nursing home for
rehabilitation. Fearing that a lengthy stay in a nursing home would require
liquidation of the family farm, Davis asked Fleagle to sell the property to her
for $1.
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On October 27, 2010, Fleagle executed a deed conveying the property
to Davis for $1. The transaction occurred at Fleagle’s hospital bed. Fleagle
was never transferred to a nursing home and died, intestate, on December
20, 2010.
Approximately six months later, Leach filed a complaint seeking to
invalidate the October 27, 2010 deed. Discovery ensued, and the parties
ultimately filed opposing motions for summary judgment. Leach asserted
that Davis had a confidential relationship with Fleagle at the time he
executed the deed. If she could prove this assertion, Davis would be
required to prove that transfer of the deed was “free of any taint of undue
influence or deception.” Hera v. McCormick, 625 A.2d 682, 690 (Pa. Super.
1993) (citations omitted).
The trial court concluded Leach had failed to adduce sufficient
evidence of a confidential relationship, granted Davis’s motion, and
dismissed Leach’s complaint. On appeal, this Court reversed, holding Leach
had presented sufficient evidence of a confidential relationship to survive a
motion for summary judgment. The case was remanded for a bench trial.
After hearing the evidence, the trial court found Leach had established
Davis had a confidential relationship with Fleagle at the time the deed was
executed. Furthermore, the court found Davis had failed to establish the
deed transfer was not caused by undue influence. It therefore ordered Davis
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to transfer ownership of the property to Fleagle’s estate for proper
distribution.
Davis filed a post-trial motion arguing the trial court had erred in (1)
failing to determine whether she had been unjustly enriched before creating
a constructive trust, (2) concluding that a confidential relationship had
existed, and (3) considering certain medical evidence. 2 The court denied the
motion on January 3, 2017. Davis filed this appeal and subsequently had the
verdict reduced to judgment.
Our appellate role in cases arising from non-jury trial verdicts is
to determine whether the findings of the trial court are
supported by competent evidence and whether the trial court
committed error in any application of the law. The findings of
fact of the trial judge must be given the same weight and effect
on appeal as the verdict of a jury. We consider the evidence in a
light most favorable to the verdict winner. We will reverse the
trial court only if its findings of fact are not supported by
competent evidence in the record or if its findings are premised
on an error of law. However, where the issue . . . concerns a
question of law, our scope of review is plenary.
Stephan v. Waldron Elec. Heating and Cooling, LLC, 100 A.3d 660,
664-665 (Pa. Super. 2014) (citation and brackets omitted). Further, the
fact-finder is free to accept or reject the testimony of both expert and lay
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2 Davis’s motion was mistakenly titled “Motion to Reconsider.” Our review
indicates that despite this mistake, the motion is properly considered a
motion for post-trial relief. We therefore decline to find Davis’s issues on
appeal waived. Furthermore, while the motion was technically filed twelve
days after the verdict, it was timely filed. The motion was required to be
filed by December 25, 2016, which was a Sunday. The Franklin County
Courthouse was closed on December 26, 2016, as a court holiday. Thus, the
motion was timely filed on December 27, 2016. See Pa.R.C.P. 106(b).
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witnesses, and to believe all, part or none of the evidence. See Terwilliger
v. Kitchen, 781 A.2d 1201, 1210 (Pa. Super. 2001).
Davis’s first two issues assert the trial court applied improper
standards in concluding Fleagle had been unduly influenced. Often, the
concept of undue influence is addressed in cases arising from a will contest.
However, the standards by which we measure a claim of undue influence are
the same for inter vivos gifts. See Withers v. Withers, 70 A.2d 331, 332
(Pa. 1950).
To establish undue influence, a plaintiff must establish three elements
by clear and convincing evidence. See In re Estate of Ziel, 359 A.2d 728,
734 (Pa. 1976). First, a plaintiff must establish the existence of a
confidential relationship between the grantor and the defendant. See In re
Estate of Fritts, 906 A.2d 601, 607 (Pa. Super. 2006). In addition to the
confidential relationship, a plaintiff must establish the defendant received a
substantial benefit pursuant to the confidential relationship. See id. Finally,
the plaintiff has the burden of establishing the grantor had a weakened
intellect at the time of the transfer. See id.
If a plaintiff meets these burdens, the burden shifts to the defendant
to establish the absence of undue influence. See In re Bosley, 26 A.3d
1104, 1108 (Pa. Super. 2011). The defendant must meet this burden by
clear and convincing evidence. See id.
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First, Davis argues the evidence of record cannot support a finding of
undue influence as it was not sufficient to establish that she acted to control
Fleagle’s decision to give her the property. Thus, she challenges the court’s
conclusion that a confidential relationship existed between herself and
Fleagle.
A confidential relationship exists when “the circumstances make it
certain the parties do not deal on equal terms, but, on the one side there is
an overmastering influence, or, on the other, weakness, dependence or
trust, justifiably reposed.” Owens v. Mazzei, 847 A.2d 700, 709 (Pa.
Super. 2004) (citations omitted; emphasis in original). Likewise, a
confidential relationship “is marked by such a disparity in position that the
inferior party places complete trust in the superior party’s advice and seeks
no other counsel.” In re Estate of Fritts, 906 A.2d 601, 608 (Pa. Super.
2006) (citation omitted).
Here, we can find no error in the trial court’s determination. A
confidential relationship “exists whenever one occupies toward another such
a position of advisor or counselor as reasonably to inspire confidence that he
will act in good faith for the other’s interest.” Foster v. Schmitt, 239 A.2d
471, 474 (Pa. 1968) (citation omitted). As noted above, it is undisputed
Davis acted as her father’s financial manager for years before his death. She
was responsible for paying his bills and paid him a monthly allowance. It is
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thus clear Fleagle had confidence Davis would act in good faith in pursuit of
his interests.
Davis next argues the trial court utilized an improper standard after
finding a confidential relationship existed. She contends the court was
required to determine she used undue influence after it found the existence
of a confidential relationship. We disagree.
Davis contends the trial court found she was not motivated by ill-will
and that she was acting in Fleagle’s best interests when she counseled her
father to transfer the property to her. However, a careful reading of the
court’s opinion reveals Davis’s summary to be inaccurate. The court wrote:
Unfortunately for [Davis], she cannot overcome the fact that the
transaction, although perhaps motivated by good intentions, was
…[3] an act of undue influence. In fact if the court looks over Mr.
Fleagle’s life he was always very determined to retain the farm
to keep it for himself. However when presented with
misinformation and an inaccurate statement that the nursing
home could attach and make a claim against the farm, depriving
him of it, he executed a deed without question. His
independence and determination to retain the farm as evidenced
by all of his past conduct and his ability to deflect and parry
away requests to purchase the farm was undermined by a few
simple and inaccurate statements by his daughter.
The court has been encouraged to find that the conveyance of
the farm to Ms. Davis was of little to no consequence, because
the farm was to be hers. Yet the record is devoid of any
testamentary document confirming just that.
Trial Court Opinion, 12/15/16, at 27-28 (emphasis supplied).
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3 We omit the word “not” as context indicates this was an inadvertent
typographical error.
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Thus, the court did not find Davis had acted with proper intentions, but
rather allowed that this may have been the case. The remaining portion of
the paragraph reveals why the court was not persuaded by Davis’s
contention that the conveyance of the farm conformed with a good faith
consideration of Fleagle’s desires and goals.
The trial court’s factual findings are amply supported by the record.
And we cannot find that its legal reasoning is unsound. Davis’s second
argument on appeal therefore merits no relief.
In her third and final argument, Davis asserts the trial court was
required to find that she was unjustly enriched before it could impose a
constructive trust on the property. A constructive trust may be imposed
when the grantee of a property had a confidential relationship with the
grantor at the time of transfer and that there was a promise to reconvey the
property. See Moreland v. Metrovich, 375 A.2d 772, 775 (Pa. Super.
1977). This test, utilized by the trial court, is an alternative test to the
“unjust enrichment” test cited by Davis. See id., at 776. Thus, contrary to
Davis’s argument, the trial court was not required to find she was unjustly
enriched in order to impose the constructive trust.
Furthermore, we conclude the trial court’s imposition of the
constructive trust is justified in any event. Davis argues that, as the only
living child of Fleagle, and one who had not only lived with him for a
significant time, but also provided care and companionship to him, she was
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not unjustly enriched by receiving the property. However, as the trial court
noted, there is no testamentary document regarding ownership of the
property, let alone a testamentary document directing she receive it.
Evidence at trial revealed Fleagle desired, above all, to retain possession of
the farm during his life, and he only transferred it to Davis when he feared it
would be seized by the nursing home to pay for his care.
This evidence is sufficient to support a finding that Fleagle desired to
have the property reconveyed to him under circumstances where its
ownership was no longer subject to attack by creditors. Under these
circumstances, the trial court’s imposition of a constructive trust is well
supported by the record. Davis’s final issue on appeal merits no relief.
Judgment affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 02/13/2018
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