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Landmark TX Case on Interference w/Inheritance Expectancy

Landmark TX Case on Interference w/Inheritance Expectancy

In a six-year family dispute over an Atascosa County ranch, the Texas Supreme Court is currently weighing whether or not a Texas-based law firm, Jackson Walker LLP, caused a landowner’s beneficiaries to lose a $3 million inheritance. Oral arguments began Wednesday for this landmark case that is set to determine whether, for the first time, Texas will recognize tortious interference with an expectancy of inheritance as a legal cause of action.

Kinsel Family Sues Over $3M Land Inheritance: Jury Awards $3.8M

The case involves Texas landowner, Lesey Kinsel, who co-owned a 2,400-acre ranch and subsurface oil and gas interests valued at $3 million with her step-daughter, Virginia Kinsel (Lesey owning 60% and Virginia owning 40%). Just prior to her death, the 93-year-old Kinsel decided to sell the Atascosa County ranch for $5 million and amend the trust, leaving the proceeds to her niece Jane Lindsey and nephew Bob Oliver.

In 2011, Virginia Kinsel and her three children filed a lawsuit against Jane Lindsey, Bob Oliver and Jane Lindsey’s Jackson Walker law firm attorney Keith Branyon, claiming that Branyon exploited Lesey Kinsel’s reduced mental capacity to persuade her to sell the Atascosa County ranch and amend the trust to favor Lindsey and Oliver.

The plaintiff’s claimed that Branyon’s undue influence over his client caused them to lose the 60% inheritance of the ranch.

In November 2012, a Tarrant County District Court jury awarded $3.8 million to Virginia Kinsel and her three children - $3 million for the 60% ownership of the land they would have inherited but for Branyon’s undue influence over Lesey Kinsel, plus $800,000 in attorneys’ fees from the case against Branyon.

Jackson Walker LLP appealed the decision, arguing that Branyon played no significant role in Kinsel’s decision to sell the ranch and that, although the plaintiffs might have inherited Kinsel’s 60% share of the land had she not sold it, no evidence was presented suggesting she planned to will the land to them in the first place.

Appellate Court Strikes Damages, Retains Constructive Trust Of Ranch Sale Proceeds

In April 2015, the Seventh Court of Appeals determined that the trial court erred in its decision, claiming that neither the Texas Supreme Court nor Second Court of Appeals has ever recognized tortious interference with an expectancy of inheritance as a cause of action.

The court struck the damages amount against Jackson Walker and retained a constructive trust for the proceeds from Kinsel’s ranch sale.

In December 2016, the court granted two petitions for review: one from Virginia Lindsey and her three children seeking $3 million for the land value plus $800,000 in attorneys’ fees for their case against Branyon; the second from defendants Jane Lindsey and Bob Oliver who argued that the constructive trust over the proceeds from the sale was unjust and that Lesey Kinsel was “lucid and coherent” the day she signed the amended trust.

Defendants Argue Kinsel Not Lacking In Mental Capacity

During oral arguments Wednesday, in response to the question of Lesey Kinsel’s mental capacity, plaintiff Virginia Lindsey argued that, once Lesey met a threshold of mental incompetence, she could never regain the competence required to understand the legal implications of her trust.

Defendants Lindsey and Oliver argued that the evidence shows Kinsel had the mental capacity to understand the decisions she made to amend the trust on the day of execution. They argue that the Amarillo appellate court ignored Texas law requiring that proof of competence be lacking at the time of execution unless the individual has a condition that is “persistent and likely manifest at the time of the execution.” Lindsey and Oliver claim that the evidence showed only that Lesey Kinsel had physical infirmities and “senior moments” but not dementia.

Will Texas Recognize Tortious Interference With Expectancy of Inheritance?

Jackson Walker is arguing that undue influence is not an actionable tort, that acknowledgement of a tortious interference with an expectancy cause of action in Texas is “inimical to public policy,” and that no evidence exists demonstrating that Branyon unduly influenced Kinsel to sell the ranch.

Tortious interference with an expectancy of inheritance is currently recognized as a cause of action in many states and acts to protect individuals’ beneficial interests in trusts and estates.

In general, to recover damages under the tortious interference of an expectancy rule, a plaintiff must prove that (1) they had a reasonable expectation of receiving the benefit, (2) the defendant interfered with that expectancy via fraud, duress or undue influence, and (3) the plaintiff suffered damages as a result of the tortious conduct.

The Texas Supreme Court’s decision is going to be an important one, potentially determining whether Texas will begin to recognize tortious interference with expectancy of inheritance as a legal cause of action in the future.

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