Order Marc J. Lane's
When a family winds up in a dispute over a dead relative’s estate, one of the accusations that may be made is that one or more persons used “undue influence” over the deceased. Typically, this involves a claim that someone improperly caused the deceased to create or amend a will or trust to benefit that person rather than the persons who otherwise would have inherited from the deceased.
The Illinois Supreme Court, in its leading case on the subject, In re Estate of Hoover (1993), explained that the kind of “undue influence” which could invalidate a will occurs when there is any improper urgency of persuasion whereby a person’s intention is overpowered and the person is induced to do an act which the person would not do if left to act freely, or to refrain from an act which the person would do if left to act freely. To constitute undue influence, the influence must be of such a nature as to destroy the person’s freedom concerning the disposition of his estate and render the person’s will that of another person.
The court went on to state that the exercise of undue influence may be inferred in cases where another person’s power was so exercised upon the mind of the deceased as to have induced the deceased to confer a benefit contrary to the deceased’s deliberate judgment and reason. Accusations of undue influence may most often be found when a testator’s mental state was in decline at the time that he or she executed a will or trust, but not all such cases raise those implications. The Estate of Hoover case itself involved a testator who was found to have been mentally competent, but who was suspected of having signed codicils to his will under improper influence, where other relatives had allegedly made “a calculated series of lies, misrepresentations, and omissions” about his son’s character to persuade him to disinherit the son.
For several years, Illinois law has prohibited persons who have been convicted of financial exploitation, abuse, or neglect of an elderly person or a person with a disability from receiving any property, benefit, or other interest by reason of the death of that elderly person or person with a disability. More recently, the prohibition has been expanded to impose a similar prohibition on persons who have been found civilly liable of financial exploitation of the elderly or disabled person – an easier standard of proof compared to requiring a criminal conviction. But such laws may not have been sufficient to deter such exploitation. More recent legislation in Illinois and similar laws in other states have been enacted with the goal of preventing financial exploitation of elderly persons by caregivers.
Effective in 2015, the Illinois Probate Act, Article IVa, now provides that certain transfers to caregivers are presumptively void. A “caregiver” is defined as “a person who voluntarily, or in exchange for compensation, has assumed responsibility for all or a portion of the care of another person who needs assistance with activities of daily living.” Also treated as caregivers under this article are the spouse, cohabitant, child, or employee of a caregiver. However, family members of the person receiving assistance -- spouses, children, grandchildren, siblings, aunts, uncles, nieces, nephews, first cousins, and parents – are excluded from the definition of “caregiver” for purposes of this article.
The documents to which this law pertains are “transfer instruments” – that is, legal documents intended to effectuate a transfer effective on or after the transferor's death, such as wills, trusts, deeds, forms designated as payable on death, contracts, and other beneficiary designation forms – but only if the transfer instrument was signed on or after January 1, 2015, the effective date of the law. The legislation provides that in any civil action where a transfer instrument is challenged, there is a rebuttable presumption that the transfer instrument is void if the transfer is to a caregiver and the fair market value of the transferred property exceeds $20,000.
Hence, instead of a deceased person’s heirs having to prove that a caregiver exercised undue influence over the deceased and procured a will, trust, or similar document in favor of the caregiver, the burden of proof shifts to the caregiver. In such a situation, the caregiver must prove either that (a) the caregiver’s share under the transfer instrument is no greater than the caregiver would have received under the transfer instrument that was in effect before the transferee became the deceased’s caregiver, or (b) the transfer was not the product of fraud, duress, or undue influence. Proof that the caregiver would not receive an increased share under the transfer instrument need only be by a preponderance of the evidence. But if the caregiver would receive an increased share under the transfer instrument, the caregiver is required to prove the absence of fraud, duress, and undue influence by clear and convincing evidence – a tougher standard.
Unfortunately, this law raises almost as many questions as it answers. For example, an unscrupulous caregiver could exert undue influence over a low-income person whose estate amounts to only, say, $15,000, and procure a will written in favor of the caregiver to claim the person’s entire estate, without having the will presumed to be void, and leaving the deceased’s relatives with the burden of proof to show that the caregiver used undue influence. Meanwhile, another person whose estate amounts to, say, $10 million, might write a will leaving $9.9 million to family members and $100,000 to a trusted caregiver; in such a case, the family members might choose to take advantage of the presumption and challenge the will, in which case the caregiver would have the burden of proof to show that he or she did not use fraud, duress, or undue influence to have the deceased make such a gift – even though the caregiver would only be receiving 1% of the deceased’s estate in such a situation. Regardless of whether this was what the Illinois Legislature intended, this is what they have enacted.
By contrast, other states which have enacted laws to protect against undue influence by caregivers have done so in different ways. For example, both California and Nevada have enacted similar presumptions about gifts to caregivers being void, but have also adopted procedures whereby a planned transfer to a caregiver can be reviewed by an independent attorney, who counsels the person making the transfer outside the presence of any heir or proposed beneficiary and attempts to determine if the intended transfer is the result of fraud or undue influence. If the independent attorney provides a written certificate in which the attorney states that the proposed transfer is not the result of fraud or undue influence, the transfer will not be presumed void. However, the Illinois law does not provide for such an independent review process.
It’s unfortunate that honest caregivers may fall under undeserved suspicion as a result of our state’s recent legislation, but Illinois residents who really do wish to leave part of their estates to their caregivers should take the law into account in order to ensure that their wishes will be fulfilled after their deaths. Meanwhile, let’s hope that the law will indeed help catch the unscrupulous caregivers at whom it is targeted or deter them from exploiting their employers.
Our firm helps older clients preserve their assets and protect their income. Marc Lane founded the Illinois chapter of the National Academy of Elder Law Attorneys (NAELA) and served as its first President. Should you have any elder law issues or concerns, we invite you to contact him in confidence at 312-372-1040/800-372-1040 or [email protected]
Joshua S. Kreitzer is a Senior Associate Attorney with The Law Offices of Marc J. Lane, a Professional Corporation. Mr. Kreitzer is a graduate of Northwestern University (J.D.), the University of South Florida (M.A.), and Harvard University (B.A.)
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