Appeal from the District Court of Sublette County The Honorable Norman E. Young, Judge Representing Appellants in Case No. S-10-0179:
The opinion of the court was delivered by: Kite, Chief Justice.
Chris Edwards of Simpson, Kepler & Edwards, LLC, the Cody, Wyoming Division of Burg Simpson Eldredge Hersh & Jardine, PC, Cody, Wyoming. Henry F. Bailey, Jr. and Lance T. Harmon of Bailey, Stock & Harmon P.C., Cheyenne, Wyoming. Argument by Mr. Bailey.
Before KITE, C.J., and GOLDEN, HILL, VOIGT, and BURKE, JJ.
This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of typographical or other formal errors so correction may be made before final publication in the permanent volume.
[¶1] Following a bench trial, the district court concluded that Eva D. and Lee J. Kelly (the Kellys) exercised undue influence over Robert Lee McNeel. Accordingly, the district court invalidated the trust and will in which Mr. McNeel had named Mrs. Kelly as one of two beneficiaries in place of his son, Roby McNeel. In a separate proceeding, the district court granted Roby McNeel's motion to remove Mrs. Kelly as Mr. McNeel's guardian and conservator, and appointed Roby McNeel to replace her. The Kellys appealed, claiming the district court's finding of undue influence and removal of Mrs. Kelly as guardian and conservator were clearly erroneous. We affirm.
[¶2] The issues for this Court's determination are whether the district court's finding of undue influence and removal of Mrs. Kelly as Mr. McNeel's guardian and conservator were clearly erroneous.
[¶3] Mr. McNeel married Lois Hicks in 1948. At the time of the marriage, Ms. Hicks had two daughters by her deceased first husband, Eva Bronnenberg (Mrs. Kelly), age three, and Roberta Bronnenberg (Mrs. Jenkin), age five. During the marriage, the McNeels had one child together, Mary Kay McNeel (Mrs. Diehl). Mr. and Mrs. McNeel raised the three girls on their ranch in Bondurant, Wyoming. Mrs. McNeel died in June of 1984.
[¶4] In January 1985, at the age of fifty-nine, Mr. McNeel married Paula Webb. They had a son, Roby, in 1987. Mr. McNeel's step-daughters did not approve of the marriage; consequently, he had no significant contact with them for many years. In 1991, Mr. McNeel established the Robert L. McNeel Family Trust. His wife and son were the only beneficiaries under the trust.
[¶5] In 1998, Mr. McNeel sold the ranch in Bondurant, except for 80 acres that had been homesteaded by Mr. McNeel's first wife's parents (the Hicks property). He purchased a ranch near Big Piney and he and his wife and son moved there. At the time of the trial in this matter, the Big Piney ranch consisted of approximately 4,015 acres of deeded land and 31,000 acres of grazing-permitted land, 420 cattle and two homes.
[¶6] Beginning in 1997, when Mr. McNeel was seventy-one, his regular physician, Dr. Michael Menolascino, became concerned that Mr. McNeel might be suffering from organic brain syndrome. Cognitive testing performed at that time revealed at least a mild cognitive impairment. By 2001, Mr. McNeel was taking Aricept, a medication prescribed for Alzheimer's disease. In 2002, Mrs. McNeel expressed concern to Dr. Menolascino about her husband's behavior, providing notes in which she had documented episodes of unusual behavior on his part, including accusing her of infidelities and expressing the belief that Roby was not his son. Dr. Menolascino performed a mental status exam and concluded Mr. McNeel was suffering from progressive Alzheimer's dementia.
[¶7] In the winter of 2002-2003, Mr. McNeel's older step-daughter, Mrs. Jenkin, reestablished a relationship with her step-father and she and her husband moved back to the ranch to live with Mr. McNeel, his wife and son. In February of 2003, Mr. McNeel, then seventy-eight, filed for divorce. Mrs. McNeel moved out of the home she had shared with him and into the second home located on the ranch. In response to the divorce complaint, she asserted that her husband was not mentally competent to pursue the divorce. Mr. McNeel's attorney retained Dr. Bruce Kahn to evaluate Mr. McNeel and provide an opinion as to his mental competency. In March of 2003, Dr. Kahn diagnosed Mr. McNeel with mild dementia with delusional features. His conclusion that Mr. McNeel was suffering from delusions was based on Mr. McNeel's emphatic belief that Roby was not his biological son despite DNA evidence to the contrary.
[¶8] In June of 2003, Mr. McNeel amended the Robert L. McNeel Family Trust to create the Robert McNeel Living Trust in which he disinherited his wife and named his son as his sole beneficiary. Around the same time, the Kellys stopped at the ranch and visited with Mr. McNeel. He told them he needed help with the ranch and, in July of 2003, Mrs. Kelly returned to the ranch permanently. Mr. Kelly continued to live and work in Nevada but returned frequently to help with the ranch work. Shortly after Mrs. Kelly moved in, the McNeels' son, who was then fifteen years old, left his father's home and began staying with his mother or friends.
[¶9] In the course of the divorce proceedings, Mr. McNeel agreed to the appointment of a guardian/conservator to help effectuate a property division and ensure the ranch continued to operate as it had in the past. In a separate action, he filed a petition requesting the appointment of Steven D. Olmstead as his guardian and conservator. The district court entered an order appointing Mr. Olmstead in August of 2003.
[¶10] In April of 2004, Mr. McNeel met with an attorney to discuss another change to his estate plan. At that time, he contemplated leaving the 80 acre Hicks' property in Bondurant to Mrs. Kelly and Mrs. Jenkin and the remainder of his estate to his son. Mr. Olmstead requested that he wait until the divorce was final and knew what property was his before changing his estate plan. In June of 2004, Mr. McNeel was granted a divorce with the property division left unresolved. A trial was held in October of 2004 to address the property division; however, no decision was rendered at that time.
[¶11] In December of 2004, Mr. Kelly moved to the ranch to live with his wife, Mr. McNeel and the Jenkins. On January 2, 2005, the ranch house in which they were living burned down. They rented rooms at an inn in Marbleton, Wyoming where they lived for the next few months. A few days after the fire, Mr. Kelly drove Mr. McNeel to Afton, Wyoming to meet with his attorney to change his 2003 estate plan. At that time, Mr. McNeel told his attorney that he wanted to leave his entire estate in equal shares to Mrs. Kelly and Mrs. Jenkin. A few weeks later, on January 20, 2005, Mr. Kelly called the attorney at Mr. McNeel's request and asked him to change the estate plan from equal shares to leave two-thirds of his estate to Mrs. Kelly and one-third to Mrs. Jenkin. On January 25, 2005, despite Mr. Olmstead's request that he wait, Mr. McNeel signed the trust amendment and will expressly disinheriting his son and leaving two-thirds of his estate to Mrs. Kelly and one-third to Mrs. Jenkin. On February 10, 2005, the district court entered an order dividing the McNeels' marital property.
[¶12] On the night of March 29, 2005, Roby McNeel found his father walking down the road in Marbleton. He stopped and asked his dad what he was doing. Mr. McNeel responded that he was headed to the ranch and intended to stay out there. Despite knowing that the ranch house had burned down and there was no place for his father to stay, Roby offered him a ride to the ranch. After confirming that there was no place for Mr. McNeel to stay, Roby took him back to Big Piney to Dr. David Burnett's office. Dr. Burnett found Mr. McNeel to be extremely agitated and confused and recommended that his son take him to the hospital in Jackson, Wyoming. The hospital physician's assessment was that Mr. McNeel had advanced dementia with very little insight into his condition.
[¶13] Mr. McNeel was referred to a psychiatric hospital in Salt Lake City, Utah. He remained there through April when he was discharged into the Kellys' care. In July of 2005, Mrs. Kelly was substituted for Mr. Olmstead as guardian and conservator. Mr. McNeel's condition continued to deteriorate and, after temporarily placing him in a skilled nursing facility in Salt Lake City, the Kellys had him transferred to a secure treatment facility. A few days later, Mrs. Kelly signed a contract for construction of a half million dollar house on the ranch. After the construction was completed, the Kellys lived in the new house, charged expenses to the trust account and paid Mr. Kelly a monthly salary from the trust.
[¶14] As Mr. McNeel's guardian and the conservator of his estate, Mrs. Kelly was required to file regular accountings of her administration of the estate for approval by the district court. In 2007, she and Mr. Kelly filed a declaratory judgment action against Roby McNeel.*fn1 They alleged that Roby McNeel had made claims in the guardianship/conservatorship proceedings that they had exercised undue influence over Mr. McNeel and that was why he signed the 2005 trust amendment and will disinheriting his son and leaving the entire state to his step-daughters. The Kellys asked the district court to declare the 2005 trust documents valid.
[¶15] Roby McNeel answered the complaint and filed a counterclaim and third party complaint against the Kellys. He asserted the Kellys obtained their interest in the McNeel property by exercising undue influence over Mr. McNeel at a time when he lacked contractual or testamentary capacity. He sought a declaration that the 2005 trust amendment and will were invalid.
[¶16] The district court convened a bench trial from January 19 to 23, 2010. In May of 2010, the court issued a judgment and order finding that Roby McNeel did not establish by a preponderance of the evidence that Mr. McNeel lacked testamentary capacity on January 25, 2005, but did establish by clear proof that the Kellys exercised undue influence over Mr. McNeel in executing the 2005 trust amendment and will. The district court held invalid the January 25, 2005, trust amendment and will disinheriting Roby McNeel, leaving in effect the terms of the 2003 Robert L. McNeel Living Trust naming Roby McNeel as sole beneficiary. In the ...