Kase v. French – Case Brief
Kase v. French, 325 N.W.2d 678 (S.D. 1982).
Facts: French and his wife (D) bought a grocery store. French made a delivery to the home of Mrs. Williams, a woman in her eighties, and discovered that she had been injured in a fall. French and his wife later agreed to take care of Mrs. Williams until she died. Williams later agreed to sell her house and property to them for $40,000 at 1% interest with no down payment. The contract was consummated with the knowledge of Mrs. Williams’ attorney and against his advice.
Kase (P), the administrator of Williams’ estate, sued to nullify the contract and to recover various cash transfers obtained allegedly through undue influence. The trial court upheld the validity of the contract on the basis that no confidential relationship was present between Mrs. Williams and French. Kase appealed.
Issue: What are the indicia of undue influence?
Holding and Rule (Wollman): The indicia of undue influence are: a person susceptible to undue influence, the opportunity to exert undue influence to effect a wrongful purpose, and a result clearly showing undue influence.
The court found that the trial court had been mistaken and that a confidential relationship had existed between P and D, which arose from D’s promise to take care of Williams. However, Mrs. Williams was able to care for herself and was mentally alert and competent and had consulted with legal counsel prior to the sale. The property was appraised at $35,000 and while the interest rate and down payment were favorable, Mrs. Williams was permitted to live there rent free for two years. The court held that D had not taken unfair advantage of Mrs. Williams and let the judgment of the trial court stand.
Disposition: Judgment affirmed.
Dissent (Henderson): The evidence does not show D to be the good Samaritans they professed themselves to be. D violated the confidential relationship between the parties by not properly advising Mrs. Williams about a fair interest rate for the purchase of her home. Mrs. Williams called upon her attorney to prepare a contract, not to give her legal advice. There is evidence that D abused their relationship with Mrs. Williams while writing checks on her accounts and conducting her business affairs.