Kyle v. Perdue

WALKER, J. The original bill in this case was filed for the foreclosure of a mortgage, the ownership of which was claimed by the appellants, R. B. Kyle and Sam. Henry, under a certain instrument alleged by them to have been executed by Mrs. Augusta E. Perdue on the 9th day of — 582 — August, 1886. The case was in this court at a former term, on appeal from a decree sustaining demurrers to tbe bill. It was then held that, so far as the title to the mortgage and the right to sue on it were concerned, the instrument was not testamentary in character, but operated as a deed. It was decided that the demurrers had been improperly sustained. — Kyle v. Perdue, 87 Ala. 423. After the remandment of the cause, Mrs. Perdue interposed an answer and cross-bill, wherein she denied the rights set up by Kyle and Henry under the instrument of August 9, 1886, and ashed that it be cancelled, on the grounds (1) that her signature to it was made at a time when she was physically and mentally incapable of transacting business of any kind, so that in signing the instrument she knew nothing of its contents or of its import; and (2) that in the alleged execution of said instrument she did not act freely and understandingly, but that her signature to the same was procured by the fraud and undue influence of Kyle and Henry who had long been her confidential friends and business advisers and as such had great influence over her which they abused by getting her to convey all her property to them at a time when she was prostrated by a serious illness and when she did not understand the terms or effect of the instrument which she signed. That instrument can not stand if either of the above mentioned grounds of attack upon it is sustained by the evidence. The' testimony of several witnesses, whose credibility does not seem to be affected by any improper bias, tends strongly to show that on the 9th of August, 1886, Mrs. Perdue was in no condition, mentally or physically, to attend to the disposition of her property. Two colored women who waited on Mrs. Perdue during her sickness describe her condition at and about the time the paper was signed as one of extreme illness. It appears from their testimony that she was physically helpless, was out of her head, and was unable to transact any business. Mrs. Hosmer, who was a near neighbor of Mrs. Perdue and was present when the instrument in question was signed, describes her as completely prostrated mentally and physically at that time, and says that her mind was not theu strong enough to enable her to know and understand the business she was engaged in. Mr. Mower, a minister of the Protestant Episcopal Church, states that he had known Mrs. Perdue since 1850, and was lor many years a friend of her deceased husband, who was a minister of the same church. He testifies that as minister he called to see Mrs. Perdue on the day the paper was signed, — 583 — and that at tbat time ber mind was seriously impaired, and that she was neither mentally nor bodily in a condition to attend to any business relating to the disposal of her property. Mr. Dortch, an attorney, states that on Sunday, the 8th of August, 1886, he was asked by R. B. Kyle to go to Mrs,. Perdue’s residence, Kyle stating that Mrs. Perdue wanted to dispose of her property and wished the witness to draw the papers. Mrs. Perdue was found in’a condition of such prostration that the business was posponed until next day. On the next morning Mr. Kyle again asked the witness to go to Mrs. Perdue’s residence. The witness refused to go, at the same time telling Mr. Kyle that he had detérmined not'to go back there as it was his judgment and opinion that Mrs. Perdue was unable to dispose of her property, and that he would have nothing to do with drawing the papers. There was other evidence to support the allegation that Mrs. Pedue was at that time physically and mentally unfit to attempt the transaction of business. On the other hand, the witnesses introduced by the defendants to the cross-bill, including the physician who regularly attended upon Mrs. Perdue during her sickness, stated that she was competent to transact business and that she was able to understand the instrument when she signed it. We are thus confronted with irreconcilable conflicts in the testimony upon the issue as to Mrs. Perdue’s mental competency at that time. In considering the evidence bearing upon the charge that Mrs. Perdue, in signing the instrument, was unduly influenced by Kyle and Henry who abused the confidence which she reposed in them as her trusted friends and business advisers, it is material to ascertain at the outset the truth as to the relations existing between the parties. Kyle and Henry admit that they were on terms of intimate friendship with Mrs. Perdue, but deny that they occupied toward her any relation of special trust or confidence. From their own account of this matter the following state of facts is disclosed : Kyle and Henry were men of wealth actively engaged in business pursuits. For many years prior to his death they were intimate personal friends of Dr. Perdue who was a clergyman and a school-teacher. He frequently advised with them as to his business affairs. His means were invested in a residence in Gadsden, in railroad stocks and bonds, and in notes and mortgages. He had no children, and bequeathed all his property to his wife. A few weeks before his death he told Mr. Henry that he wanted him to look after and care for his wife. This conversation — 584 — Henry repeated' to Mrs. Perd'ue after her husband’s death. After she became a widow both Henry and Kyle frequently advised her in regard to her business affairs. She had such confidence . in them that she requested them to use money she had on hand .and pay her interest on it, as she preferred that disposition of it to any other investment. To satisfy her each of them accepted some of her money in this way, giving their,notes and paying the interest as accrued. The box containing her valuables was kept in Mr. Henry’s vault. He attended to getting the securities which her husband had left her transferred to her name and looked after collections for her. She was an old woman, and it is plain that she regarded Kyle and Henry as her trusted friends, and that she was in the habit of applying to them for advice in all business matters or troubles, and that they advised and assisted her whenever the occasion to do so was afforded. She had been quite ill for several weeks when, on August 8th, 1885, Mr, Kyle called, to see her in response to a message to the effect that she wished to see him on business. When he entered her room she said that she wanted to see him about her business. In the course of the conversation she said that she was very sick and wanted to arrange her business before she got worse. She did not on that occasion state what disposition she wished to make of her property, but requested Mr. Kyle to bring Mr. Dortch to draw the papers. Kyle returned with Mr. Dortch during the afternoon of that day. At that time Mrs. Perdue was greatly prostrated and stated that she was unable to attend to the business. She requested Mr. Kyle to bring Mr. Henry with him when he came again. Henry states that on the morning of Aug118! 9, Kyle said to him that Mrs. Purdue wished them to come to her house, that she wanted to make some disposition of her property. They accordingly went to her house that morning. Mr. Dortch having refused to go with them they decided to take another attorney. The attorney who. accompanied them had never spoken to Mrs. Perdue before that day. When her attention was called to his presence and he spoke to her she asked him if he was a lawyer. Both. Kyle and Henry say that when they went to Mrs. Per-due’s residence that morning they did not know what disposition she proposed to make of her property. From their own version of the circumstances attending their visit it is plain that they understood that Mrs. Perdue wished to make some disposition of her property and that she desired them to. be present to see that the business was properly attended to, Mr. Henry says that when the instrument which she — 585 — signed'was read over to ber sbe asked bim if it was right. Sbe sought and relied upon bis advice as sbe bad often done before. In considering the transaction then bad between Mrs. Perdue on the one band and Kyle and Henry on the other, due regard should be bad to their attitude towards ber as shown by their previous relations with ber and by the circumstances which, led to their presence in her house on that occasion. There are well established rules to be applied in passing upon transactions between persons whose relations are such as to suggest that in dealings between them confidence is reposed and accepted to such an extent that one of them is subject to the influence or ascendency of the other. When such a relationship is shown to exist if the one who was in a position to exert the influence claims the benefit of a contract with the person bestowing the confidence, the burden is cast upon the former to show affirmatively that the influence of his position, was not unduly exerted, that the utmost good faith was exercised, and that all was fab', open, voluntary and well understood. This rule as to the burden of proof is of familiar application to contracts by which benefits are conferred by a cestui que, trust upon his trustee, by a ward upon his guardian, by a child upon his parent, by a client upon bis attorney, by a patient upon bis physician, Or by any one upon bis priest or spiritual adviser. — Noble v. Moses, 81 Ala. 530; Dickinson v. Bradford, 59 Ala. 581; Malone v. Kelly, 54 Ala. 532 ; Boney v. Hollingsworth, 23 Ala. 690; Johnson v. Johnson, 5 Ala. 94; Marx v. McGlynn, 88 N. Y. 357 ; Hugnenin v. Baseley, 2 Leading Cas. in Eq., (W. & T.) 1156. The relations here mentioned are but instances in which the principle is applicable. ■ It is not essential that any formal or technical relationship of a fiduciary character has been established betweén the parties. It suffices that they stand in such a relation to each other that, while it continues, confidence is justifiably reposed by one, and the influence which naturally grows out of that confidence is possessed by the other. When -the parties are merely friends of each other and deal upon • terms of equality, the burden of showing the invalidity of any transaction between them is upon the one who assails it. But where their situation is such that as a matter of fact confidence • is reposed on one. side and there is superiority on the other side resulting from the influence acquired by the acceptance of the confidence bestowed, there is a presumption of undue influence to be rebutted by the superior party. Transactions between such persons may be entirely valid, but the — 586 — one wbo is in a position to influence tbe other must show that the duty which he assumed by the acceptance of the confidence has been fully performed.— Voltz v. Voltz, 75 Ala. 555; Shipman v. Furniss, 69 Ala. 555; Waddell v. Lanier, 62 Ala. 347 ; Ferguson v. Lowery, 54 Ala. 510; Cowee v. Cornell, 75 N. Y. 99; Billage v. Southee, 9 Hare, 534; Tate v. Williamson, L. R. 2 Ch. 55; Kerr on Fraud and Mistake, (Bump’s Ed.) 183; 2 Pomeroy’s Eq. Juris., §§ 956, 963; 8 Amer. & Eng. Ency. of Law, 647-654. In the present case it appears from the testimony of, the beneficiaries in the instrument which is assailed that the grantor therein had long been in the habit of seeking and relying upon their advice and assistance in reference to her business affiairs; that the circumstances leading to their visit to her on the occasion when the instrument was signed were such as to make it plain that she looked to them to see that the disposition of her property which she desired was properly made; and that by the arrangement which she then suggested and to which they fully assented they formally assumed the position of trustees of all her property with powers implying her unlimited confidence in their fidelity to her interests. It does not often happen that any of the familiar relations of a fiduciary character between adults beget in fact more of trust and confidence than the statements of Messrs. Kyle and Henry show that they were the recipients of on the occasion in question. "We are satisfied that it is incumbent upon them to show that Mrs. Perdue signed the instrument voluntarily, deliberately and advisedly, with full knowledge of its nature and effect; that there was an absence of all undue influence, advantage, or imposition; and that they did not in any way mislead her as to the meaning or operation of the paper prepared for her signature. — Balkum v. Breare, 48 Ala. 75; Jackson v. Harris, 66 Ala. 565; Haydock v. Haydock, 34 N. J. Eq. 570; Gillespie v. Holland, 48 Am: R. 1; Baker v. Monk, 4 DeG., J. & S. 388, and authorities cited supra. Mr. Kyle states that Mrs. Perdue said to Mr. Henry: “I wanted to see you and Col. Kyle about the disposal of my property. They want me to give it to the church, but I do not want to do it. I know what I want to do with it. I want you and Col. Kyle to take charge of all my property and take care of me while I live, and when I die Í want you to pay all my debts, if any, and put a tomb-stone like the one over my dear husband’s grave over my grave, and then I want the balance of my property divided equally between you and Col. Kyle, reserving to Bookie and Zeebie the lots — 587 — set apart to them. Can I do it ? Col. Henry replied very promptly, ‘Ton certainly can, madam, if yon desire to do it.’ ” Henry says : “"Wben I went into ber room I went np to ber bed. I asked ber bow sbe felt. After answering me sbe told me tbat sbe bad sent for Mr. Kyle and me, tbat sbe wanted to give bim and me everything sbe bad in trust. Tbat we were to look after ber business and attend to ber business. I wont be certain wbat other words sbe used. Sbe said tbat sbe wanted to give it to me and Kyle square out, the property to be held by us during ber life in trust for ber support. This is all that- I recollect now that sbe said before the paper was written.” As to wbat occurred wben the paper was signed, be says : “Capt. Cunningham read over the paper to her. Sbe remarked that sbe.wanted to give Kyle and me the property in trust. Sbe seemed not to have grasped the idea of its being given in trust in the paper. It was then re-read to ber. She then asked me if tbat was right, and I told ber if wbat sbe told me just before the paper was written was right, it was. Sbe then took pen in band as above statedand also, in reply to an inquiry as to wbat explanation was made by Cunningham : “The explanation given by bim was tbat she.gave her property to Kyle and Henry, but tbat they were to have it for ber support.” Henry called to see Mrs. Perdue after ber recovery and sbe then asked bim as to the contents of the instrument which sbe bad signed during her illness. He testifies : “I told her tbat in the paper sbe bad given everything sbe bad to Kyle and me. That we were to look after ber and support ber and have the property in trust for tbat purpose, and tbat in the paper sbe authorized us to make a deed each to Bookie and Zeebie of an eighth of an acre each with the bouses where they lived. Sbe asked me then if the interest on ber papers would not support ber, or if sbe was to get sick again, bow was sbe to be provided for? I told ber tbat it was Kyle’s and my duty under the deed to take care of ber and support ber.” It is plain from the testimony of both Kyle and Henry tbat they understood tbat, by accepting the benefit of the instrument, they became bound to provide for the support of Mrs. Perdue during ber life, without regard to the sufficiency of the income to be received by them from ber property. They are careful to state tbat the money and supplies which they have furnished ber were from their own means and were not derived from the trust estate. The instrument which was signed by Mrs. Perdue does not provide for such a disposition of ber property as the. — 588 — statements of Kyle and Henry sbow was proposed and was understood to be effected. There is nothing in the instrument to impose upon the grantees any duty to care for or support the grantor during her life; they are only required to pay her so much of the income from the property as may be left after deducting all expenses for repairs and for all charges, taxes and assessments. No .provision is made for the payment of the grantor’s debts, or for the erection of a tomb-stone over her grave. The trust for her support during her life does not extend to the property conveyed but only to the income therefrom. Yet the trustees do not intimate that they understood that her claim upon the trust estate for a support was to be limited to the income. That, however, is the extent of the provision in her favor. The effect of the instrument which was prepared and signed is that Mrs. Perdue strips herself of all beneficial interest in her property except as to the net income therefrom during her life, and that the grantees do not undertake to contribute one cent to her support either from their own means or from the corpus of the trust estate. If Mrs. Perdue signed the instrument on Henry’s assurance that it was right and that it conformed to her directions,' it is plain that she acted under an entire misapprehension of its real meaning and effect. A comparison of the contents of the instrument with the statements by Kyle and Henry as to what was proposed and understood leads inevitably to the conclusion that in signing the instrument Mrs. Perdue did not understand its contents. Henry’s own statement shows that he misled her, whether he intended to do so or not. The grantees acquired greater benefits than were intended to be conferred, and they did not assume the obligations to which they consented. The disposition of property which Messrs. Kyle and Henry say Mrs. Perdue expressed a desire to make was not effected by the instrument which she signed after being assured by Henry that the paper conformed to her directions. If that instrument is allowed to stand the grantees thereby acquire all of the grantor’s property of every description without becoming liable to secure to her the substantial advantages which were contemplated to 'be provided for in her favor by the arrangement which was proposed. The testimony of the grantees themselves shows that the grantor never intended to make such a disposition of her property &s is embodied in the instrument which she signed. In view of the relations of trust and confidence existing between the parties, and of the evident reliance by the grantor on the false assurances of one of the grantees, — 589 — an instrument, tbe provisions of which fall so far short of the grantor’s understanding of its operation in her favor can not prevail against her impeachment of it. .The result is. that, accepting the version of the transaction as detailed by the parties who assert its validity, it must upon their own statements be pronounced invalid. It is, therefore, unnecessary to pass upon the conflicts in the testimony upon the issue as to Mrs. Perdue’s mental competency at the time she signed thé instrument. It is urged that by accepting' money and supplies from Kyle and Henry Mrs. Perdue ratified the invalid instrument. It is plain that she had no intention to ratify it. She was asserting its invalidity in the courts. Her adversaries, by the active assertion, of their claim, had succeeded in cutting her off from,the enjoyment of the income from her property. She received their contributions toward her support during the pendency of this suit, and while she was under the stress of want, caused by the withdrawal of her accustomed means of livelihood. Ón one of the receipts which was presented for her signature she wrote, “I take this money because I am starving.” Beceipts given in such circumstances are entitled to no weight as evidence of a free consent to confirm the voidable transaction. The evidence by no means shows that the alleged acts of ratification were free, voluntary and well understood.— Voltz v. Voltz, 75 Ala. 567; Thompson v. Lee, 31 Ala. 392; Butler v. Haskell, 4 Dessau. (S. C.) 651; 2 Pom. Eq. Jur., § 964. "We discover no error of injury to the appellants in the decree of the Chancery Court. Affirmed.