Ethan R. Okura
Hawai‘i Herald Columnist
In previous columns, I have addressed the subject of financial abuse of the elderly. This usually involves outright stealing or fraud. However, there is another form of financial abuse that is subtler, harder to identify and often doesn’t show up until after the beloved family member has passed on. This type of problem is called “undue influence.”
What is “Undue Influence?”
Black’s Law Dictionary defines “undue influence” in these words: “In regard to the making of a will and other such matters, undue influence is persuasion carried to the point of overpowering the will, or such a control over the person in question as prevents him from acting intelligently, understanding, and voluntarily, and in effect destroys his, and constrains him to do what he would not have done if such control had not been exercised.”
California Probate Code Section 86 and California Welfare and Institutions Code Section 15610.70 define undue influence as “excessive persuasion that causes another person to act or refrain from acting by overcoming that person’s free will and results in inequity.”
What that means in plain English is that sometimes an unscrupulous person will manipulate another person who is dependent on them or otherwise vulnerable in such a way that the unscrupulous person will benefit or profit from the fact that the other person is dependent or vulnerable. In other words, it’s when someone puts inappropriate pressure on someone else to get him or her to do something that they wouldn’t do otherwise.
Examples of Undue Influence
Although undue influence can occur while executing a contract or a real estate transaction, it most often comes up in the contesting of a last will and testament. One of the most notorious Hawai‘i cases in recent times involved the Estate of Herbert, a case that the Hawai‘i Supreme Court decided on March 17, 1999.
In this case, an elderly woman named Ms. Herbert had written a will in September of 1988, leaving all of her assets to her local church upon her death. Ms. Herbert had a 26-year-old Canadian caregiver named Hanno Soth, who assisted her with doctor visits, taking prescription medication and even managing her finances beginning in December 1989 until her death. Hanno Soth apparently had Ms. Herbert change her will in December of 1989, leaving everything — over $1 million — to him. This happened during the two-week period when Ms. Herbert’s live-in housekeeper was out of state on a vacation. Soth later fired the housekeeper, whose last day of work happened to be three days before Ms. Herbert passed away. At trial, there was even testimony that Soth had spent the night at Ms. Herbert’s home for the first time the night she died. These are very suspicious circumstances.
Friends, neighbors, the housekeeper, and Ms. Herbert’s doctors and lawyers testified that when the new will was signed, Ms. Herbert did not have sufficient mental capacity to understand what she was signing — or to even remember the next day what she had signed. The court decided that Ms. Herbert did not have the mental capacity to change her will at that time, was mistaken about what was written in it and was unduly influenced in its execution. Thus, the caregiver, Mr. Soth, did not succeed in inheriting her assets.
Another example is more recent. It involves Princess Abigail Kawananakoa (known as “Kekau”), the closest living relative to Queen Liliuokalani. The queen was Kekau’s great-aunt. There has been a legal battle brewing between Kekau’s longtime domestic partner and now-wife, Veronica Worth, and Kekau’s former attorney, James Wright. He petitioned the court, asking that Kekau, now in her 90s, be prevented from controlling her trust after she suffered a stroke. Kekau herself sent a handwritten letter to a local news outlet insisting that it was only a minor stroke and accused her attorney of mismanagement. Her estate is worth over $200 million. You can see why many people are concerned about what happens to it. The attorney claimed to be protecting Kekau from “opportunists and interlopers,” perhaps referring to Kekau’s now-spouse, Ms. Worth.
Although Kekau’s stroke was real, whether it left her incapable of managing her affairs is the question before the courts. Although she insists that she is still competent, at least two medical experts appear to have found her lacking mental capacity. Now, the three board members of the Abigail K.K. Kawananakoa Foundation — a charitable organization that is expected to inherit large sums for the benefit of Native Hawaiians upon Kekau’s death — are also attempting to intervene in the management of Kekau’s trust in order to protect the future interests of the foundation. In this case, Kekau’s former attorney, James Wright, is claiming that he worries that Worth is exercising undue influence over Kekau to benefit from her estate. Worth, on the other hand, claims that Wright is the one trying to take advantage of Kekau’s estate. The court will ultimately settle the dispute.
In these types of cases, it’s hard to know for sure whether there actually were bad actors or just people trying to look out for the elderly person’s best interests as they perceived those interests evolving. Regardless, it’s important to communicate your wishes with multiple friends and family members early, so that they know your intentions. It’s also important to establish a good relationship with an estate planning firm that will likely be around when you might become incapacitated so that there is a clear record of your plan and whom you trust to carry out that plan for you.
© OKURA & ASSOCIATES, 2018
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Ethan R. Okura received his doctor of jurisprudence degree from Columbia University in 2002. He specializes in estate planning to protect assets from nursing home costs, probate, estate taxes and creditors.
This column is for general information only. The facts of your case may change the advice given. Do not rely on the information in this column without consulting an estate planning specialist.
See more articles by Ethan by visiting https://okuralaw.com/blog/