03/17/2005 FYI – Undue Influence and Constructive Fraud Claims Should Have Been Submitted to Jury

After her husband became ill, an elderly woman who had never managed finances during their married life summoned her children to meet with her and to help decide how to handle the family ranch and other properties. After the family discovered that her husband had incurred $54,000 in credit card debt the children agreed to take responsibility for that debt in return for their mother transferring shares of stock in the ranch to them; she made transfers of substantially all of the stock based on that understanding.

Later, the mother sued for return of the ranch stock, claiming that her children had unduly influenced her, that they had defrauded her and that they had converted her property. Before trial all but one of the children reconveyed their interests to her; at the close of her case against the last remaining defendant, the court granted a verdict in favor of that child. The state Supreme Court reverses and remands for a new trial, finding that there is a separate cause of action for undue influence and that the evidence, when viewed in the light most favorable to the mother, could support a judgment in her favor. Similarly, the evidence would support a jury verdict in her favor on constructive fraud and conversion claims; on remand she may also amend her pleadings to conform to the evidence and include claims for unjust enrichment and quasi contract.

Johnson v. Reiger
Supreme Court of Wyoming, July 15, 2004