Court addresses claim of undue influence in life insurance benefits
The Court of Appeals sent United of Omaha Life Insurance v. Nees back to the trial court after examining the facts of the case on appeal. Willis Tomlin bought life insurance back in 1993 and designated his mother his sole beneficiary. In 1996, Willis began dating Jerri Nees, moved in with her, and they had a child together. In 2006, he was hospitalized with chronic liver disease and vested Nees with his power of attorney.Nees brought Willis Change of Beneficiary forms, allegedly at his request. Just before Willis' death, in the presence of a witness and a notary, he changed beneficiaries from his mother to his long-term partner and their child. An involved social worker and the notary testified that he did this without compulsion and knowingly, however, his mother filed suit alleging undue influence by the girl-friend, Nees.
The trial court found that Nees did not exercise undue influence on Willis' change of beneficiaries, and therefore, Willis' mother did not establish a presumption of undue influence requiring Nees to rebut the presumption that arises when a fiduciary acts in her or his own interest. The Court of Appeals held that the lower court did not accurately apply the law and sent the case back for further examination. It ruled that even though Willis' girlfriend did not use her power of attorney to change beneficiaries, the existence of that relationship rendered her a fiduciary owing Willis a fiduciary duty. The lower court must therefore examine the case in light of the presumption that there was undue influence and determine whether the facts presented by Nees rebutted that presumption.