Undue Influence in Trust Amendment Results in Attorneys Fees

The Oklahoma Supreme Court has ruled that the nearly disinherited step-grandchildren of an elderly decedent are entitled to attorneys fees in their action to set aside a trust amendment that was obtained through undue influence. Corr v. Smith (Okla., No. 102687, Feb. 12, 2008).

Rachel Corr established a trust that divided her estate between her husband and her sister. Mrs. Corr's husband, her stepson, and her sister all predeceased her. After her husband died, Mrs. Corr was largely bedridden and her great-niece, Linda Smith, and her husband moved in to her home. During this time, Mrs. Corr executed an amendment to the trust that disinherited the Corr family and substituted her nieces and nephews as the primary beneficiaries.

Mrs. Corr's step-grandchildren sued to have the trust amendment set aside as being a product of undue influence. The trial court agreed and declared the trust amendment to be void. The grandchildren asked for attorney fees under a state law, which provided this remedy for cases "involving a trust." The court granted the fees, and the Smiths appealed arguing the attorney fee provision applies only to actions for breach of trust. The appeals court reversed the award of fees and expenses. The Corrs appealed.

The Oklahoma Supreme Court reverses, finding that the statute unambiguously allows for attorneys fees in cases, such as this, that involve a trust. According to the court, "Mrs. Corr's trust was the target of the Smith's actions and they were in "breach of trust" from the moment they succeeded in having [Mrs. Corr] execute the amendment."

For the full text of this decision, go to: http://www.oscn.net/applications/oscn/deliverdocument.asp?citeid=451262.