Appeal from the Iowa District Court for Linn County, James H. Carter, Judge.
The opinion of the court was delivered by: Vogel, P.J.
A plaintiff appeals a jury verdict for the defendant on a claim of undue influence. A defendant cross-appeals the denial of a directed verdict on the same. REVERSED AND REMANDED FOR NEW TRIAL ON APPEAL; AFFIRMED ON CROSS-APPEAL.
Heard by Vogel, P.J., and Potterfield and Doyle, JJ.
The case before us involves a dispute over the revocable trust of Louis Burkhalter Jr.*fn1 One of Louis's sons, William Burkhalter, sued his brother, Steven Burkhalter,*fn2 claiming Steven unduly influenced their father to modify the revocable trust just days before Louis's death. William also raised claims of lack of testamentary capacity and tortious interference with a trust. The district court directed a verdict for Steven on the tortious interference claim, and the jury returned a verdict for Steven on the testamentary capacity and undue influence claims. William appeals asserting the marshalling instruction on the undue influence claim was erroneous, heightening his burden of proof. Steven cross-appeals the district court's denial of his motion for directed verdict.
I. Background Facts and Proceedings
On January 14, 1980, Louis created the Louis D. Burkhalter Jr. Revocable Trust, with the United State Bank, a/k/a/ Hawkeye Bank, n/k/a U.S. Bank, N.A., of Cedar Rapids, Iowa, designated as trustee. The primary beneficiary of the trust, after the death of Louis and his wife, Margaret,*fn3 was William, with the remaining trust assets at the time of William's death to be distributed to the heirs of Louis.
The trust was amended in December 1995 naming William's wife, Cynthia, and son, Matthew, beneficiaries.
In 2003 the trust was again amended, providing the trustee may, at its discretion, use trust income or principal for the support of Louis's sister, Patricia. The home William lived in throughout his life was placed into the trust in 2004, with the intent that William, Cynthia, and Matthew would have "complete control of the residence" so long as it was "reasonable and approved by U.S. Bank."
The events of July 2007 are at the center of this lawsuit. Louis, then age ninety-eight, was in declining physical health and moved from the Woodlands Manor, the independent living wing at Meth-Wick assisted living community, to The Woodlands, the twenty-four hour care wing. On July 9, Steven, aware of this change, left his home in California and arrived in Cedar Rapids to see Louis. On July 11, Steven and Louis had a conversation about the trust, which, according to Steven's testimony, went as follows:
[Louis] said to me . . . "I want to make a change with that trust. I want to change the beneficiaries to 50-50 with you and William. I want you to call Phil Hershner at the US Bank[.]" . . . [Louis] says, "Phil doesn't get into his office 'till like 9:00, 9:30, so I want you to call him this morning and go down to see him and tell him that I want to change the trust beneficiaries to 50-50 between William and Steven. I will sign whatever you want-whatever he wants me to sign to get that accomplished."
That same day, July 11, Steven went to meet with Hershner, who then called Louis's attorney, William Hochstetler. Hershner met with Louis the morning of July 11. Hochstetler met with Louis the next day. The trust was modified on July 13, 2007, dividing the trust assets equally between William and Steven. Louis died on July 19, 2007.
William filed a petition on January 25, 2008, alleging the 2007 modification was a result of undue influence, Louis lacked the capacity to make the modification, and Steven intentionally and improperly interfered with the distribution plan of the trust. A jury trial commenced on October 31, 2011, and the district court granted Steven's motion for a directed verdict on the tortious interference with the trust claim but denied it as to the undue influence and lack of capacity claims.
After an unreported conference, the parties and the court made a formal record regarding the court's proposed jury instructions. William objected to the court's marshalling instruction on undue influence, particularly the use of the word "clearly" in instruction number two, paragraph number five-"The changes made to the trust provisions were clearly the result of the foregoing circumstances"-claiming it was a commentary on the evidence and was suggesting a higher burden of proof than the preponderance of the evidence. The district court ...