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Vig v. Swenson

Supreme Court of North Dakota

December 7, 2017

Mary Ann Vig, as Personal Representative of the Estate of Junietta W. Swenson, Deceased, Plaintiff and Appellant
v.
Willis G. Swenson, Defendant and Appellee

         Appeal from the District Court of Divide County, Northwest Judicial District, the Honorable David W. Nelson, Judge. AFFIRMED.

          Erin M. Conroy, Bottineau, N.D., for plaintiff and appellant.

          Taylor D. Olson, Williston, N.D., for defendant and appellee.

          OPINION

          Tufte, Justice.

         [¶ 1] Mary Ann Vig, as personal representative of the Estate of Junietta Swenson, appeals from an order [1] dismissing the Estate's action against Willis Swenson. The Estate argues that Junietta Swenson lacked capacity to execute a July 5, 2012, quit claim deed conveying her home in Noonan to her son, Willis Swenson, and that he converted rent and grain proceeds when he subleased her farmland. We conclude the district court did not clearly err in finding Junietta Swenson was legally competent to execute the quit claim deed, or in finding that Willis Swenson did not convert the proceeds of a sublease of land he leased from Junietta Swenson. We affirm.

         I

         [¶ 2] The issues in this appeal involve a dispute between Willis Swenson and other adult children of Robert and Junietta Swenson about the ownership of the Noonan home and the right to the proceeds of leases of agricultural land. According to Willis Swenson, he moved back to North Dakota from Minnesota in 2001 to help care for his ailing father, and after his father's death in March 2005, he was primarily responsible for the care of his mother.

         [¶ 3] Before Robert Swenson's death in 2005, the parents had rented their farmland in Burke County to a third party for $20, 016 per year. In July 2008, Willis and Junietta Swenson entered a handwritten agreement for Willis Swenson to lease the farmland from Junietta Swenson for $20, 016 per year "continuing for the term of fifteen (15) years until October 15, 2024." In October 2008, Willis Swenson and Kyle Mahlum entered into a five-year lease to cash-rent part of the farmland for $26, 667 per year and to sharecrop the remaining land. After operating under that lease for one farming season, Willis Swenson and Mahlum executed a written agreement on December 16, 2009, to cash-rent the farmland for a total annual rent of $31, 022.50. Mahlum farmed the land and made payments under that lease in 2010, 2011, and 2012. Meanwhile, on November 4, 2011, Willis and Junietta Swenson executed another lease for the farmland "during the seasons of 2012 through 2022." That lease required Willis Swenson to pay Junietta Swenson a total of $20, 016 per year for cash rent.

         [¶ 4] On March 13, 2012, Junietta Swenson was admitted to a nursing home as a result of her declining medical condition, including chronic heart and kidney failure, macular degeneration, and diabetes. Some family members thereafter discovered that she had sold some of her dividend-producing stocks on March 14, 2012, by a telephone call initiated by Willis Swenson to her broker, and she had executed a quit claim deed conveying her Noonan home to Willis Swenson on March 15, 2012. According to those family members, Junietta Swenson had no recollection of selling her stocks and did not authorize Willis Swenson to make any transactions with her brokerage account.

         [¶ 5] On March 28, 2012, the district court granted a petition for a temporary guardianship and conservatorship for Junietta Swenson for ninety days, naming two of her children, Vig and Lee Alan Swenson, as temporary guardians and conservators. The temporary guardianship and conservatorship expired on June 25, 2012.

         [¶ 6] In April 2012, the State charged Willis Swenson with exploitation of an elderly adult under N.D.C.C. § 12.1-31-07.1. As a condition of bond, the district court ordered Willis Swenson to have no unsupervised contact with his mother and to execute a quit claim deed reconveying the Noonan home to her. Willis Swenson reconveyed the Noonan home to his mother on May 25, 2012.

         [¶ 7] On June 22, 2012, Lee Alan Swenson petitioned for a permanent guardianship and conservatorship for his mother, alleging she was subject to undue influence by certain family members and was incapable of managing her financial affairs. After a July 11, 2012, hearing, the district court found Junietta Swenson was an incapacitated person and appointed Lee Alan Swenson as her permanent guardian and conservator on July 12, 2012.

         [¶ 8] Meanwhile, on July 5, 2012, Junietta Swenson executed a quit claim deed, again conveying her Noonan home to Willis Swenson. According to Vig, Willis Swenson's "significant other, " Marilee Nelson, procured Junietta Swenson's signature on the deed while visiting her at the nursing home. The deed was recorded by the Divide County recorder on February 13, 2014, after Junietta Swenson died in November 2013.

         [¶ 9] The Estate sued Willis Swenson, alleging the July 5, 2012, quit claim deed was void because Junietta Swenson was incompetent to execute the instrument, and seeking an order requiring Willis Swenson to reconvey the Noonan home to the Estate. The Estate also alleged that Willis Swenson's subleases of Junietta Swenson's farmland to Mahlum constituted conversion of rent and grain proceeds that should have been paid to her.

         [¶ 10] After a bench trial, the district court dismissed the Estate's action, ruling that Junietta Swenson's clear intent was to convey the Noonan home to Willis Swenson, that an April 2013 video of Junietta Swenson explained her decision to deed the home to him, and that from the entire record, it appeared the deed was for Willis Swenson's past services to his parents. The court determined Junietta Swenson was legally competent and was not suffering from a disability when she executed the July 5, 2012, quit claim deed conveying the Noonan home to Willis Swenson. The court also ruled there were no legal grounds to question the terms of the farm leases between Junietta and Willis Swenson, there was no question she was competent when the leases were executed, and she was aware of Willis Swenson's subleases with Mahlum and was "OK" with the amount of rent she received from Willis Swenson.

         II

         [¶ 11] The Estate argues the district court erred in finding Junietta Swenson was legally competent to execute the July 5, 2012, quit claim deed conveying her Noonan home to Willis Swenson. The Estate argues that the court's conclusory findings do not provide an understanding of its decision and that the court misapplied the law regarding capacity to execute the deed because the court's decision cited no legal standard for capacity and mistakenly relied on Junietta Swenson's intent. The Estate also contends there is insufficient evidence to support the court's decision, because the time line for the temporary and permanent guardianship and conservatorship proceedings during the period when the deed was executed is instructive and leaves a firm conviction the court made a mistake.

         [¶ 12] Before a court may set aside a transaction on the ground of mental incapacity, the party attacking the validity of the transaction has the burden to prove the grantor, at the time of the transaction, was so weak mentally as not to be able to comprehend and understand the nature and effect of the transaction. Estate of Wenzel-Mosset v. Nickels, 1998 ND 16, ¶ 13, 575 N.W.2d 425; Matter of Estate of Nelson, 553 N.W.2d 771, 773, (N.D. 1996); Slorby v. Johnson, 530 N.W.2d 307, 309-10 (N.D. 1995); Runge v. Moore, 196 N.W.2d 87, 102-03 (N.D. 1972); Lee v. Lee, 70 N.D. 79, 84, 292 N.W. 124, 126-27 (1940); Meyer v. Russell, 55 N.D. 546, 575, 214 N.W. 857, 869 (1927).

         [¶ 13] In Runge, 196 N.W.2d at 103 (quoting Lee, 70 N.D. at 84, 292 N.W. at 126), this Court discussed the development of the law for the analysis of competency to execute a deed:

"The test of capacity is laid down by this court several times. In Nelson v. Thompson, 16 N.D. 295, 301, 112 N.W. 1058, 1060, this early rule, deduced from Jackson [ex dem. Cadwell] v. King, 4 Cow. N.Y. 207, 15 Am. Dec. 354, 355, was adopted: Upon the question of incapacity to render a deed invalid, the court must be satisfied that the grantor was not in a situation to transact that particular business rationally... not, on the one hand, that he should be capable of doing all kinds of business with judgment and discretion, nor, on the other hand that he should be wholly deprived of reason, so as to be incapable of doing the most familiar and trifling work. That, if the mind and memory were in such a situation at the time of executing the deed as to render him wholly incompetent to judge of his rights and interests in relation to that transaction, the deed would be void.'
"In Meyer v. Russell, 55 N.D. 546, 214 N.W. 857, we say: Impairment of faculties by disease or old age will not invalidate a deed, provided the grantor fully comprehended its meaning and effect, and was able to exercise his will in executing it.'
"Again: Before the court will set aside a conveyance on the ground of mental incompetency of the grantor, it is necessary to show that the grantor, at the time of the execution of the instrument, was so weak mentally as not to be able to comprehend and understand the nature and effect of the transaction involved.' Nordby v. Sagen, 64 N.D. 376, 252 N.W. 383.
"Old age alone does not affect competence, even though the mind may be weak and impaired compared with what it has been, and even though the capacity to transact general business may be lacking."

         [¶ 14] A district court's finding on capacity, or lack of capacity, is a question of fact. Estate of Wenzel-Mosset, 1998 ND 16, ¶ 14, 575 N.W.2d 425; Estate of Nelson, 553 N.W.2d at 773. We will not set aside a district court's finding of fact unless it is clearly erroneous. N.D.R.Civ.P. 52(a); Estate of Nelson, at 773. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if no evidence supports it, or if, on the entire record, we are left with a definite and firm conviction a mistake has been made. Id. In a bench trial, the district court determines credibility issues, which we will not second-guess on appeal. Buri v. Ramsey, 2005 ND 65, ¶ 10 693 N.W.2d 619. "We do not reweigh evidence or reassess credibility, nor do we reexamine findings of fact made upon conflicting testimony. We give due regard to the trial court's opportunity to assess the credibility of the witnesses, and the court's choice between two permissible views of the evidence is not clearly erroneous.'" Id. (quoting Akerlind v. Buck, 2003 ND 169, ¶ 7, 671 N.W.2d 256). A court's findings of fact must reflect the basis of its decision and enable this Court to understand its reasoning. Carlson v. Carlson, 2011 ND 168, ¶ 19, 802 N.W.2d 436. Findings of fact are adequate if we can discern the court's rationale for its decision. Id.

         [¶ 15] The district court's findings are sparse and could have been stated with more particularity. Although there were temporary and permanent guardianship and conservatorship proceedings involving Junietta Swenson and criminal proceedings were brought against Willis Swenson for his conduct with his mother around the time frame of the July 5, 2012, quit claim deed, we reject the Estate's claim that those circumstances compel a finding that Junietta Swenson lacked capacity to execute the quit claim deed. The July 5, 2012, quit claim deed was executed after the temporary guardianship and conservatorship had expired in June 2012 and before the order for a permanent guardianship and conservatorship on July 12, 2012. Under the temporary guardianship statute in effect in 2012, "[a]ppointment of a temporary guardian is not evidence of incapacity." N.D.C.C. § 30.1-28-10(2) (2011) (current version at N.D.C.C. § 30.1-28-10.1. The deed was executed after a licensed social worker had observed Junietta Swenson in the context of the permanent guardianship and conservatorship proceeding. The social worker's report states she interviewed Junietta Swenson on July 3, 2012, two days before the quit claim deed was executed, and observed Junietta Swenson was orientated and passed all competency tests performed by the worker. A video of Junietta Swenson was recorded by Marilee Nelson in April 2013, about nine months after Junietta Swenson executed the quit claim deed on July 5, 2012, and was introduced into evidence at trial. The district court relied on the video in determining Junietta Swenson was legally competent at the time of the deed and was not suffering from a disability.

         [¶ 16] The Estate had the burden to prove that when Junietta Swenson executed the July 5, 2012, quit claim deed, she was so weak mentally as not to be able to comprehend and understand the nature and effect of the transaction. Estate of Wenzel-Mosset, ...


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