o
To be argued by:
Peter G. Barber, Esq.
Time requested:
l0 minutes
STATE OF NEW YORK SUPREME COURT
APPELLATE DIVISION THIRD DEPARTMENT
Proceeding by CHRISTOPHER J. NEALON, as Executor of
the Last Will and Testament of MURIEL M. NEALON,
O Deceased,
Petitioner-Respondent,
To discover property withheld and belonging to Decedent.
TRACEY NEALON.
PETERNEALON.
Respondent-Appellant,
Respondent.
Schenectady County Surrogate File No. 1386-0574
BRIEF'ON BEHALF OF'
RESPONDENT-APPELLANT TRACEY NEALON
MURPHY, BURNS, BARBER & MURPHY, LLP
Attorneys for Respondent-Appellant Tracey Nealon
226 Grcat Oaks Boulevard, Albany, New york, 12203
Telephone: 5 1 8-690-0096
Peter G. Barber, Esq.
Catherine A. Barber, Esq.
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TABLE OF'CONTENTS
Page
TABLEOFAUTHORITIES ....... i
PRELIMINARYSTATEMENT ....I
ISSUESPRESENTED .......2
STATEMENTOFFACTS ...3
ARGUMENT ... II
POINT I
TIIE SURROGATE'S COURT IMPROPERLY SHIFTED THE
BURDEN OF PROOF ON UNDUE INFLUENCE TO
RESPONDENTS ....11
A. No confidential relationship existed as a mafier of law . . . . 12
B. No confidential relationship due to the power of attorney . . 14
C. No confidential relationship due to alleged'\ryeakened state" . . . . 15
POINT II
TIIE SURROGATE IMPROPERLY RELIED UPON THE DEAD
MAN'S STATUTE TO PRECLUDE RESPONDENTS' TESTIMONY
REGARDING TIIE FINANCIAL TRANSACTIONS WITH THE
DECEDENT .. 17
POINT III
A DIRECTED VERDICT SHOULD HAVE BEEN GRANTED IN
RESPONDENTS'FAVOR ON THE ISSUE OF UNDUE
INFLUENCE ..
CONCLUSION
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TABLE OF AUTHORITIES
Page
,70N.Y.387(1877)... .....20
Cole v. Sweet, 187 N.Y. 488 (1907) . . . . . 18
Estate of Lamparelli,6 A.D.3rd 1218 (4s Dept.2004) . . . . . . 18
Estate of Wood, 52 N.Y.2d 139 (1981) . . . l8
Feiden v. Feiden, l5l A.D.2d 889 (3'd Dept. 1939) 15,21
Matter of Antoinette,z3S A.D.2d762 (3'd Dept. 1997) 12,17
Matter of Brand, 185 A.D. 134 (3'd Dept. 1918) . . . . . . 12
MatterofBreistol,64A.D.3dll22(3'dDept.2009) ....: ... 18
Matter of Estate of Fellows, 16 A.D.3 dggs (3'd Dept. 2005) 11,20
Matter ofEstate of Romano,2005 WL 155398 (N.Y.Sur.) . . . 13
Matter of Friedman, 26 A.D.3rd 723 (3rd Dept. 2006) . . 1l
Matter of MarcusTrusts,2g7 A.D.2d 68 (2"d Dept. 2002) . . . . 19
Matter ofNealon,sT A.D.3d1325 (3'd Dept. 2008) . . . . passim
Matter of Radus, 140 A.D.2d348 (2d Dept. 1988) . . . . 18
Matter of Smith ,lllA.D.zd 6,66(2"d Dept. 1991) . . . . 18
Matter of Swain, 125 A.D.2d 574 (2"d Dept. 1986) . . . . 13
Matter of Walther, 6 N.Y.2d 49 (1959) lI,!2,13,2A
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Prievo v. Urbaniak, 64 A.D.3d 1240 (4tr Dept. 2009)
Steck v. Jorling,227 A.D.2d849 (3'd Dept. 1996)
Stafutes, etc.
CPLR $4519 ("Dead Man's" Statute) passim
scPA $1401 s
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PRELIMINARY STATEMENT
In Matter of Nealon, 57 A.D.3 d 1325 (3'd Dept. 2008),this Court affirmed the
granting of summary judgment in favor of respondents-appellants Peter and Tracey on
the issue of mental capacity regarding claims by petitioner-appellee Estate of Muriel
Nealon to recover from respondents funds withdrawn by decedent from her bank
accounts. In remanding on the issue of whether respondents used undue influence to
obtain the withdrawals, this Court held that respondents should not be held to a higher
level of conduct based on an alleged confidential relationship.
At the conclusion of the proof at trial, the Surrogate's Court improperly
determined that a confidential relationship existed between decedent and respondents due
to decedent's alleged'keakened state" and the existence of a Power of Attorney between
them. With that finding, the Surrogateos Court held that respondents had the burden of
proving, by clear and convincing evidence, that each transaction was free of any undue
influence. The Surrogate's Court had compounded these errors by precluding
respondents from explaining their interactions with decedent even though the Estate had
introduced deposition testimony by respondents on these matters. These orders are in
direct conflict with the law of the case established in this Courtos prior decision.
Equally important, even in the absence of law of the case, there was no basis for
shifting the burden of proof on the claims from the Estate to respondents. No evidence
was submitted to show that respondents exercised moral coercion or other compulsive
acts upon decedent. Instead, the undisputed evidence establishes that respondents alone
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took on the personal and financial responsibility for decedent, and modified their modest
home to meet decedent's needs, while caring for their own special needs child. Nor is
there any dispute that respondents had a loving, caring and familial relationship with
decedent who decided to contribute to the increased costs of the household and provide
gifts and benefits to respondents and other family members. Simply stated, this close
family relationship did not give rise to a heightened burden or a presumption of potential
wrongdoing. In the end, the Estate failed to meet its burden of proof of moral coercion
and a directed verdict should have been entered in favor of respondents.
ISSUES PRESENTED
l. Whether the Surrogate's Court erred in finding as a matter of law that a
confidential relationship existed between decedent and respondents which shifted the
burden of proof to respondents to prove that every financial transaction involving
decedent was free of undue influence by clear and convincing
[,t{gr..,., ;J
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The Surrogate's Court reversed the burden of proof on the issue of undue A
"e,.{.'rLuJra,f ";;..lfi .r 1.r.\ I j, .,r
influence from the Estate to respondents, and instructed the jury that respondents had the
burden of proof to show every transaction free of undue influence.
2. Whether the Surrogate's Court eroneously invoked the "Dead Man's
Stafute" to preclude respondents' testimony regarding decedent's reasons for providing
the funds when respondents' deposition testimony had been offered by the Estate to
prove receipt of the funds?
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The Strrogate's Court sustained the Estate's objections and precluded
respondents' testimony about any transactions with decedent.
3. Whether the Surrogate's Court erred in denying respondents' motion for a
directed verdict on the issue of undue influence.
The Surrogate's Court first shifted the burden of proof to respondents, and then
denied respondentso motion for a directed verdict.
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STATEMENT OF FACTS
Muriel Nealon, mother of Christopher, William and Peter Nealon, was living
independently following the death of her husband in May 2001 (A109). In August 2002,
Muriel's physician, Dr. Donahue, diagnosed her with early cognitive impairment (AL27,
137). Muriel's episodes of forgetfulness caused her family to consider whether she
should continue to live alone (A99). With no other family members willing or able to
care for her, Muriel decided to live with her son Peter and his then-fiancee Tracey
McGann (A99).
Peter and Tracey owned a modest two-bedroom home in Scotia (Al19, 120). In
O September 2002, Peter and Tracey vacated their bedroom for Muriel's use. Peter and
Tracey had a toddler with cerebral palsy (Al l9), and were anticipating the birth of a
second child in January 2003 (A64). With the needs of a growing young family and to
provide appropriate accornmodations for an elderly person, Peter, Tracey, and Muriel
decided to make necessary improvements to the family residence.
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In October 2002,Peter and Tracey began construction of an addition to their
home, which included a first floor bedroom with an attachellandicapped-accessible
bathroom specifically designed for Muriel's use (4100, 113)\Ud a second story bedroom
for Peter and Tracet t"1111.*e existing bedrooms could be used for their special needs
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toddler and expected babl$tarting in November2002 and until November 2003, Muriel
signed checks for the costs of construction, gifts to her grandchildren, withdrawals for
personal and living expenses, and a wedding gift for Peter and Tracey (464, 74,84). The
financial transactions during this period are the subject of this proceeding
In February 2003, Muriel gave a Power of Attorney to Peter and Tracey (A70). In
August 2000, Muriel had given a Power of Attorney to her sons Peter and Christopher.
Christopher did not know if a copy of the 2000 Power of Attorney was ever sent to Peter
(A63). Muriel had decided to change the Power of Attorney because of increasing
difficulties in reaching Christopher due to his extensive job-related travel (A7l). Neither
Power of Attorney was used in the transactions that are the subject of this proceeding.
From November 2002 until May 2004, Peter and Tracey provided Muriel with her
daily needs, including meal preparation, laundry, housecleaning, transportation, and
personal care (469). During this time period, visits by Muriel's other sons, inctuding
petitioner Christopher Nealon, were sporadic and no family member volunteered their
services, or contributed in any way to Muriel's care. No family member was willing to
care for Muriel for brief periods to allow Peter and Tracey to take a vacation (A9Sa).
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In February 2004, Muriel was admitted to the hospital with an infection (815). By
March 2004, she was under hospice care (4133,134), while continuing to reside with
Peter and Tracey (A114). On May 18, 2004, Muriel died (Al3a).
On January 28,2005, Christopher Nealon, as Executor of Muriel's Estate, filed a
petition pursuant to SCPA $1401, et seq., seeking reimbursement from Peter and Tracey
of funds withdrawn by Muriel from her bank accounts between November 2002 and
November 2003. After extensive discovery, Peter and Tracey filed a motion for
summary judgment.
In a Decision and Order dated August 8,2006, the Surrogate's Court (Kramer, J.)
granted summary judgment against the Estate's claims. The Court held that there was no
confidential relationship between Muriel and Peter and Tracey. The Court also found
that a diagnosis of progressive dementia, without more, failed to create a triable issue of
fact as to capacity. The Court held that the Estate had failed to meet its burden to present
evidence of undue influence at the time of any of the challenged transactions, and
therefore no triable issue of fact existed as to the issue of undue influence.
In Matter of Nealon,57 A.D.3d 1325 (3d Dept. 2008), this Court affrrmed the
decision of the Surrogate's Court granting summary judgment on the issues of capacity
and confidential or fiduciary relationship, and remanded on the issue of undue influence,
finding that an issue of fact existed for trial.
At the August 2010 trial, Edmund Laven, the contractor for the addition, testified
that Muriel signed the checks relating to the construction (432-33). He recalled that
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Muriel was not confused and had appropriate conversations (A38, 41). I[r. Laven was
also Muriel's next-door neighbor and observed her in the backyard with her grandson
(A35, 36,39), and never noticed her to be in any way neglected (A40).
Muriel's son William Nealon testified that Muriel was helping to pay for
renovations to Peter's and Tracey's house (Al l-14). He was not aware of any evidence
to support the Estate's claim of undue influence (Al3).
Debra Nealon, wife of William Nealon, testified that she knew very little about
Muriel's finances (A42). She stated that she visited Muriel several times a yeax (A45).
She testified that William had received a gift of money from Muriel, and she did not
know whether Peter received a similar gift (Aa6-aD.
Beth Kissinger, a Certified Public Accountant, who prepared Muriel's tu< refurns,
testified that at an office appointment in April 2002, Muriel was oriented and asked
appropriate questions about her tax returns (A16, 18, 19, 25). Muriel told Ms. Kissinger
that she was not huppy with her son Christopher as trustee of a trust which had been
created by her (A15, 22-24). In April 2003,while at Muriel's house to discuss her ta<
return, Ms. Kissinger observed that Muriel asked Tracey to retrieve her checkbooko and
requested that Tracey fill out the check for her (A19, 3l). Ms. Kissinger believed that
this request was made because Muriel had hun her shoulder and it was physically
difficult for her to write. Ms. Kissinger saw Muriel sign the check herself (A17, 31). Ms.
Kissinger testified that Muriel appeared very happy and was insistent that she hold
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Peter's and Tracey's new baby (A19,20,26,27). She did not see Muriel in the April
2004 tax season, which was a month before Muriel died (A27).
Petitioner Christopher Nealon testified that he did not witness any financial
transactions by Muriel, and had no proof that Muriel did not authorize them (A56,57,
59). He simply posited that Muriel's diagnosis of dementia was sufficient proof that
Muriel did not authorize all of the transactions (465, 66). Petitioner Christopher Nealon
acknowledged that he had received a gift of $5,000 from Muriel in 1998, towards the
purchase of a truck (467-68).
Kathleen Nealon, Christopher Nealon's ex-wife, had no complaints about Peter's
and Tracey's care of Muriel (Al0). She only visited Muriol at Peter's and Tracey's house
three or four times (A8). She testified that over 12 years of school, Muriel had paid
$25,000 for their daughter to attend the Albany Academy for Girls (A7,9). Muriel did
not make a similar gift to her other two sons or their families (A43,44).
The Estate read the deposition testimony of Muriel's physician, Dr. Donahue, in
lieu of presenting live testimony. This testimony was included in the Estate's opposition
to summary judgment which the Surrogate's Court granted on the issue of capacity, and
this Court affirmed on appeal. Dr. Donahue testified that, after Muriel was diagnosed
with mild dementia in August 2002, her condition was stable at an office visit in
September 2002 (4128). ln a November z}Azoffice visit, Muriel showed marked
improvement on memory tests (4129). Dr. Donahue noted that it is common for aperson
diagnosed with dementia to have changes from day to day, with waxing and waning,
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including periods of complete lucidity and periods of confusion (4129, 130). Dr.
Donahue stated that it would be necessary to be present to observe Muriel in order to
know what her mental state was at any particular time (4140). In a July 2003 office
exam, Dr. Donahue noted that Muriel was doing well, and appeared well cared for and
happy, although her memory had, at that visit, declined (A131, 136). Dr. Donahue
O opined that this decline did not indicate that Muriel lacked capacity to sign forms in his
office, and she did, in fact, sign an office form that day (4135, 141). Dr. Donahue
opined that he had no medical reason to believe that Muriel, at any given time, lacked the
capacity necessary to control her own finances (A138-140).
Patricia Meo, a distant relative, testified that Muriel had good days and bad days in
general (,{52-53). She testified that Peter urrd Tru..y were giving very good care to
Muriel (453-54). Sandra Pegler, a dental hygienist, testified that she cleaned Muriel's
teeth three or four times ayear (468). Ms. Pegler testified that Muriel said positive
things about Peter, spoke about babysitting for her grandson, and had appropriate,
coherent conversations (460-63). \
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fra)Scott, a nursing assistant at Glendale Home, testified tha(she]ared for Muriel\-/\)
there several times (4106). Muriet recognized Peter and Tracey wneX*rey visited her
there, and seemed oriented and conversant (A107, 108). James McGrath, Traceyos
stepfather, testified that Muriel was "sharp as a tack" until the time of her death (Al 16).
At trial, the Estate also introduced the deposition testimony of Peter on certain
transactions with Muriel, including her payments for constructing the new bedrooms and
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monthly expenses, and her giving of gifts to her grandchildren and a wedding gift for
Peter and Tracey (A72-85). Peter testified that he used the Power of Attorney for the first
time in February 2004 (A84, 105).
The Estate also read portions of Tracey's deposition. She testified that the
transactions in question were payments for a home addition and money for household
expenses, and that Muriel authorized Peter and Tracey to make ATM withdrawals for her
expenses (486, 87).
At the close of the Estate's proof, the Surrogate's Court reserved judgment on the
Estate's motion that a confidential relationship was established as a matter of law, which
would shift the burden ofproof to Peter and Tracey to prove that each and every
transaction was free of undue influence (A90). The Surrogate stated that a mid-trial
reversal of the burden of proof would be unusual (A9l). Peter and Tracey objected,
particularly because a shift in the burden of proof could affect the presentation of their
case (490-92).
On respondents-appellants' case, Peter Nealon testified, consistent with his
deposition testimony, that he first used the Power of Attorney in February 2004, and
never used it to write any checks before that date (A105, I l5). In the prior motion for
summary judgment and a trial, this testimony was unrebutted.
Pursuant to CPLR $4519 (the "Dead Man's" Statute), the Surrogate's Court
precluded Peter from testiffing that Muriel told or directed him to do anything, and
precluded him from testifuing about any transactions (A93,94,lll,ll7). No testimony
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was allowed about any banking transactions, including gifts (A95-9S). He was precluded
from testiffing about any observations of Muriel, or anything about Muriel's involvement
in construction decisions for her new living quarters (A100-104).
Tracey Nealon testified that the construction was intended to provide a first floor
bedroom and bathroom for Muriel (4120). She testified that Peteros brothers visited
infiequently, and refused requests to provide temporary care for Muriel while Peter and
Tracey were on a wedding trip (Al2l-123). Tracey stated that she never pressured or
influenced Muriel in any way with regard to financial matters (741-42). The Surrogate's
Court again cited the Dead Man's Statute and precluded Tracey from testiffing about any
transactions with Muriel (A125, 126).
At the close ofproof, the Surrogate's Court ruled that a confidential relationship
existed between Muriel and Peter and Tracey and that they would bear the burden of
proving that the transactions were free of undue influence by clear and convincing
evidence. The Sunogate Court cited two factors: (l) that Peter and Tracey cared for the
day-to-day needs of Muriel and she was in a'heakened state"; and (2) that Muriel had
given a Power of Attorney to Peter and Tracey (A142,143).
Over the objections of Tracey and Peter, the Surrogate's Court charged the jury
with the instruction that Peter and Tracey had the burden of proof, by clear and convincing
evidence, that all of the challenged transactions were free of undue influence (4145, 146).
The jury rendered a verdict that all but a few minor transactions were the result of undue
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influence and awarded damages of $123,751.95 against Tracey and Peter Nealon (Al4T-
238). Respondent Tracey Nealon appeals.
ARGUMENT
POINT I
THE SURROGATE'S COURT IMPROPERLY SHIF'TED THE BURDEN OF
PROOF ON UNDUE INFLUENCE TO RESPONDENTS
It is well-settled that the Estate bears the burden of establishing that the financial
transactions undertaken by Muriel were the result of undue influence by Peter and Tracey.
Matter of Friedman,26 A.D.3d,723 (3d Dept. 2006). To establish undue influence, the
Estate was required to submit proof, by clear and convincing evidence, that there was
"moral coercion, which restrained independent action and destroyed free agency, or
which, by importunity which could not be resisted, constrained [Muriel] to do that which
was against [her] free will and desire." Matter of Walther, 6 N.Y.2d 49,53 (1959); Matter
of Fellows, 16 A.D.3d 995 (3d Dept. 2005).
Rather than requiring the Estate to prove moral coercion or compulsion, the
Surrogate's Court improperly shifted the burden of proof on undue influence to Peter and
Tracey based upon an alleged "confidential relationship" between Muriel, and Peter and
Tracey. The Surrogate's Court relied upon two facts:
(1) Muriel was in an alleged'\reakened state"; and
(2) Peter had Muriel's Power of Attorney.
(4142, t43).
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As demonsfated below, a confidential relationship was not created by either fact.
Moreover, the close familial relationship that existed among Muriel, Peter, and Tracey did
not justiff the shifting to Peter and Tracey the burden of proving that each transaction was
free of undue influence by clear and convincing evidence.
A. No Confidential Relationship Existed As A Matter Of Law.
In Matter of Brand, 185 A.D. l3,t (3"r Dept. 19l8), this Court emphasized the need
for caution in imposing presumed legal obligations on familial relationships. This Court
recognized that certain relationships, such as afforney and clien! trustee and beneficiary,
guardian and ward, are unequal and give rise to the legal presumption that the fiduciary
bears the burden of showing the fairness of her or his actions. While the confidential
relationship may apply in other situations, it is not presumed and must be proven by a
showing that a person imposed his will on another person and has procured that other
person to do what he wanted and not what the other person would have done, but for the
influence.
To establish a confidential relationship, the Estate was required to establish that the
transactions were the result of a "subtle, but pervasive form of coercion and influence by
which [the proponent] overwhelmed and manipulated decedent's volition to advance her'
own interests." Matter of Antoinette,23S A.D.2d762,763 Q'd Dept. lggT). It is well-
settled that where, as hereo a family member would be an expected beneficiary of a
disposition, caution should be exercised before illegitimate or unlawful motives are
attached to a family member's influence over a loved one. Matter of Walther,6 N.Y.2d
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49, 53-54 (1959). In Matter of swain, 125 A.D .zd 574, 575 (2n Dept. 19g6), the court
held that close family ties negate any presumption of undue influence that might arise
from a confidential relationship. The Court stated:
[T]he Surrogate erred in charging the jury that an inference of undue
influence arose from the confidential relationship between the testatrix and
the petitioner requiring an explanation of the bequest to the petitioner, since
'[t]he sense of family duty is inexplicably intertwined in this relationship
which, under the circumstances, counterbalances any contrary legal
presumption.'
Id.,125 A.D.2d at 575 (2nd Dept. 1986), citing Matter of Walther, 6 N.Y.2d 49,56 (1959).
See also Matter of Estate of Romano,2005 WL 155398 (N.Y.Sur.) ("The relationship
between decedent and a close family member . . . is not considered'confidential' as a
matter of law").
There is no dispute that Muriel had a close familial relationship with her son Peter
and his wife Tracey. There is also no dispute that Muriel resided with Peter and Tracey
from September 2002 until her death in May 2004, and that, during this time, Peter and
Tracey provided assistance to Muriel with her daily needs, including meal preparation,
laundry, housecleaning, transportation, and some assistance with personal care. Nor is
there any dispute that this care and assistance was exemplary with no suggestion of
neglect or abuse. There is also no dispute that Peteq Tracey, and their children would be
qxpected beneficiaries of Muriel's bequests.
.Indeed, M^*ii1ha$,made genero N gifts to' , ILfuJ .1o[.J AH\^"hu{{t,1 ,t+-a .-a-i, ,r.., S,r,t w-{ uJpl
other family members, including petitioner and his fu*ily. Likewise, thereis no
suggestion that the transactions or gifts were the result of coercion of any type. It is
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.-!eyond cavil to rygggg"tthat this loving relationship justified the imposition of a-\
heightened burden of e*xnlanation upon peter and, Tracey.
B. No Confidential Relationship Due To The Power Of Attorney.
In addition to this bar against imposing a confidential relationship on a family
relationship, this issue was also squarely addressed by this Court and the prior decision on
summary judgment. In a Decision and Order dated August 8,2006, Surrogate's Court
(Kramer, J.) held that there was no confidential relationship between the parties and that
the Peter and Tracey did not use the Power of Attorney for the transactions at issue.
On appeal, both parties briefed and argued this issue. In Matter of Nealon, 57
A.D.3d at 1328, fn 2, the Court held:
We note, however, our disagreement with petitioner's contention that
respondents must be held to a higher level of conduct commensurate with
that imposed on attorneys-in-fact. While the record indicates that a
document granting respondents power of attorney was executed in February
2003, there is no proof disputing respondents' testimony that said power of
attorney was never used until February 2004, well after the transactions of
which petitioner complains.
In Steck v. Jorling,227 A.D.2d849,850 (3'd Dept. lgg6),this Court held that
"IJnder the doctrine of the law of the case, upon remittal, the issues in a case previously
decided in the context of an appellate court review are conclusive." There was no change
in the facts at trial or intervening law that would support a departure from the law of the
case on this issue. The evidence at trial regarding the use of the Power of Attorney by
Peter and Tracey was the same relied upon by this Court and the prior decision below that
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Muriel signed each of the checks and Peter and Tracey did not use the Power of Afforney
until Febru ary 2004. r
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C. No Confidential Relationship Due To Alleged "Weakeouy' bt"t." w+u$t
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The Surrogate's Court's reliance upon Muriel's alleged'keakened state'o to impose
a confidential relationship is similarly flawed. This conclusion is contrary to the familial
relationship which encourages the in-home care of elder persons, and is simply not 6,
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supported by the undisputed facts or the law of the case. $-,,"1^f* *,Ir,r,r.i. '.i': "' ' ,e:{}u,tl rtturr4 G1:fUr,
In Feiden v. Feiden, 151 A.D.2d 889 (3'd Dept. 1989), this Court held that'SrS''- .*; O{tu^ f.l
existence of a family relationship does not,fr",s\ ileate a presumption of undue
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influence; there must be evidence of other Abse/a circumstances showing inequalrty or
controlling influence. In our viewn the state of [decedent'sl health alone was
insufficient to shift the burden of proof." (emphasis added).
Moreover, in Matter of Nealon ,57 A.D.3d at l328,this Court held that there was
no evidence that Muriel t::f!en*g at the time of any of the specific transactions at
issue. This court stated: \---l--? tiarrti't^x'+
Notably, while decedent's physician, Robert Donahue, testified as to
decedent'sprogressive delefiofation",he also clearly stated that individuals
with decedent'S eonitifion would have lucid moments and waning moments;
therefore, the fact that she lacked capacity on one day would not mean that
she could not be competent on the next. Consequently, in light of the failure
to show proof rebutting the presumption in favor of competency, Surrogate's
Court did not err in dismissing the diminished mental capacity cause of
action.
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At trial, nggUlgnge,was offered to show any inequality or controlling influence or
any other evidence to support a shifting of the burden of proof. As noted by this Court,
Dr. Donohue testified that Muriel had, until close to the end of her life, a relatively mild
cognitive impairment that waxed and waned and did not, in Dr. Donahue's opinion,
medically preclude her from managing her own financial affairs. James McGrath testified
that Muriel remained "sharp as a tack", until shortly before her death (A116). Beilr
Kissinger testified that she observed Tracey write a check at Muriel's direction, and
observed Muriel herself sign the check (A17,28). ka Scott testified that when Muriel was
at Glendale for respite care, she recognized people and she did not appear to be confused
(A107, 108). Simply stated, no witness testified that Muriel lacked capacity at the time of
any of the challenged transactions.
Equally important, the proof at trial is utterly devoid of any suggestion of coercion
or compulsion. Petitioner Christopher Nealon testified that he was not aware of any
specific circumstances in which undue influence was exerted upon Muriel. William
Nealon testified that he had no evidence that any transaction was the result of undue
influence (Al3). Sandra Pegler testified that Muriel liked living with Peter and Tracey,
and that Peter and Tracey always heated Muriel very well (A60-62). Patricia Meo
testified that Peter and Tracey took excellent care of Muriel (A53, 54). Edmund Laven,
the contractor and next-door neighbor, testified that while working on the construction
project, he saw Muriel almost daily (A34), and that Muriel did not seem confused (A35-
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38). He saw her in the backyard; saw Muriel write checks to Tracey; and witnessed no
neglect (A34, 35, 39, 40).
In sum, there wergno f-acts--.presented at trial that would establish that the state of
Muriel's health and mental capacity was so poor as to justiff imposition of a confidential
relationship, in contravention of this Courtos prior ding to the contrary.r Based upon the
undisputed facts presented at the trial, it was clear error for the Surrogate's Court to
determine as a matter of law that a confidential relationship existed between Muriel and
Peter and Tracey, and tllTltorer instruction !o the jyf_gitrng the burden ofproof on
the issue of undue influence was a fundamental error that requires reversal.
POINT II
THE SURROGATE IMPROPERLY RELIED UPON TIIE DEAD MAN'S
STATUTE TO PRECLUDE RESPONDENTS' TESTIMONY
REGARDING THE F'INANCIAL TRANSACTIONS WITH THE DECEDENT
The Surrogate's Court also erroneously interpreted the "Dead Man's" Stafute,
CPLR $4519, to preclude all testimony by Peter and Tracey about their observations of
Muriel and any actions by Muriel with respect to the transactions at issue (Al l1-l l8).
The Estate read into the record portions of the depositions of both Peter and Tracey, in
which they testified about the receipt of funds related to the specific transactions at issue.
po,,^{v$ }w.}e}t -u -- |
t Even if Peter and Tracey's care of Muriel could be construed as evidence of a confidential relationship
and that both law of the case and undisputed evidence of a loving family relationship are ignored, "the
Surrogate Court erred in charging the jury that such relationship existed as a matter of law." Prievo v.
Urbaniak. 64 A.D.3d 1240 (4u Dept. 2009); see also Estate of Antoinette,23S A.D.zd 762 (3d Dept.
1997).
t7
It is well established that, when a party puts transactions in issue by reading a
portion of another party's prior sworn testimony, the "Dead Man's" Stafute does not
preclude that party from then giving testimony further explaining the transactions placed
in issue.''Iq cole-v. Sweet, 187 N.Y.488, 492-93 (1907),the Court of Appeals held:
[PetitionerJ offered [prior testimony] to prove his case without calling the
defendant as a witness. He had a right to do this, and no complaint is made
because he did it; but, when the defendant tried to give the entire transaction
concerning which she had partially testified in his behalf, he invoked the
statute to prevent it . . . He could not thus tum a shield into a sword . . .
Havrng forced her to tell a part of the story . . . he could not read it as
evidence in this action and then prevent her from telling the whole, because
the spirit of the statute, as interpreted by the decisions of the courts, is
This well-settled principle has been re-affirmed numerous times. Estate of Wood,
52 N.Y.2d 139 (1931); Matter of Radus, 140 A.D.2d 348 (2nd Dept. l9S8); Estate of
Lamparelli, 6 A.D.3d l2l8 (4tt'Dept. 2004);Matter of Smith, 171 A.D .2d 666 (2nd Dept.
1991); Matter of Breistol,64 A.D.3d ll22 (3d Dept. 2009).
Here, the Surrogate's Court, by iq-pr-operly shifting the burden of proof a{er the
close of proof, efhcJively granjed a directed verdict in favorof the E-slate. This
fundamental error was preceded by the Surrogate's Court improperly precluding both
Peter and Tracey from explaining any transaction, or even personal observations or
personal relationship of any kind, with Muriel, despite the Estate having placed these
transactions before the jury by reading Peter's and Tracey's prior testimony. The Estate
was improperly permitted to use the Dead Man's Statute purely as a sword in this case, by
introducing deposition testimony to establish Peter's and Tracey's receipt of funds from
l8
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Muriel, and then precluding, under the Stafute, any further explanations of the transactions
thus placed at issue. Peter and Tracey were precluded from testifting that Muriel
provided the funds of her own free will to assist with the remodeling of the home, from
which she personally benefitted, to contribute toward the routine expenses of the
household, and to make gifu to her son and daughter-in-law and her grandchildren,
O despite other testimony in the record that Muriel regularly gave gifts to other sons,
children, including a large continuing gift to one grandchild for private school tuition.
POINT III
A DIRECTED VERDICT SHOULD HAVE BEEN GRANTED
IN RESPONDENTS'FAVOR ON THE ISSUE OF UNDUE INFLUENCE
At the close of the Estate's proof, Tracey moved for a directed verdict on the issue
of undue influence upon the ground that the Estate failed to establish a prima facie case of
undue influence (A88, 89). The Surrogate's Court did not deny Tracey's motion until
after determining as a matter of law that the burden shifted to Peter and Tracey to prove
every transaction free of undue influence (,4,143, 144). As demonstrated above, this ruling
was a fundamental error.
Based upon the evidence at trial, a directed verdict should have been granted. As
exhaustively discussed above, the existence of a familial relationship does not give rise to
a presumption of undue influence. Matter of Marcus Trusts ,297 A.D.2d 68 (2nd Dept.
240?). Instead, the Estate had the burden of showing "that the influence exercised
amounted ,Q| *9l9FTtT"l, gitl restrained independent action and destroyed free
6,^A
*ll** 01 JdW_ W &i)W,-'
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agencydt whicigby importunity which could not be resisted, constrained the testator to
do that which was against his [or her] free will and desire, but which he [or she] was
unable to refuse or too weak to resist." Matter of Walther, 6 N.y.2d 49,53 (1959);
Children's Aid Societv v. Loveridge, 70 N.Y. 357 (1877). Undue influence "must be
shown by establishing motive, opportunity, and the acfual exercise of that undue influence
. . . While undue influence may be proven through circumstantial evidence, that evidence
must be significant." Matter of Estate of Fellows, 16 A.D.3 d99s,996-97 (3d Dept.
f
2005).l$eneralized tg;llT-oly, without more, that decedent at times suffered from
physical weakness and confusion, is not enough to present afactquestion for the jury as to
whether any of the ftansactions were the product of undue influence. Feiden v. Feiden,
lsl A.D.2d 88e (3d Dept. l9s9):i,1
At trial, the evidence was undisputed that: (l) Muriel's diagnosis of mild dementia,
and occasional episodes of confusion or forgetfulness, did not medically preclude her
from signing documents and managing her own financial affairs, and from being perfectly
lucid and mentally capable at any given time; (2) Peter and T6acey cared for Muriel's
il.$,.4.l ( s-t /rc r[.r^
varying day-to-day needs in their home in an attentiie and exemplary manner; (3) Muriel
was observed during the relevant time period to be signing her own checks and
demonstrating an awareness of her financial situation; and (a) the Estate presented no
evidence that Muriel was improperly influenced or lacked the capacity to understand her
actions at the time that she made any of the challenged transactions. In sum, the Estate
failed, as a matter of law, to prove by clear and convincing evidence that any of the
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transactions were the result of undue influence. As such, directed verdict should have
been granted to Peter and Tracey.
CONCLUSION
For these reasons, respondent-appellant Tracey Nealon respectfully requests that
this Court reverse the judgment of the Surrogate's Courto and enterjudgment in favor of
respondent-appellant Tracey Nealon and respondent Peter Nealon.
Dated: May 24,2012 MURPIIf" BURNS, &\RBER & MURPHY, LLP
gv-\-
Catherine A. Barber, Esg.
Peter G. Barber, Esq.
Attorneys for Respondent-Appellant
226 Great Oaks Boulevard
Albany, New York, 12203
Telephone: 518-690-0096