WILDER, P.J.
In this action originating in the Charlevoix Probate Court, appellees contested the August 13, 2010 trust and the June 8, 2011 will of decedent Robert D. Mardigian (decedent). Appellees challenged the trust and will on the basis that appellant, the proponent of the documents and the recipient, together with his children, of the majority of decedent's estate, also was the drafter of the documents in violation of the Michigan Rules of Professional Conduct (MRPC). In a motion for summary disposition filed in the probate court under MCR 2.116(C)(10), appellees contended that the devises were void as against public policy and, therefore, unenforceable. The probate court granted the motion for summary disposition, and this appeal ensued. For the reasons articulated herein, we reverse.
On August 13, 2010, decedent executed an amended trust prepared by appellant,
After decedent's death, appellant sought to introduce the documents he had prepared for probate, along with a petition to be appointed personal representative pursuant to the language in the document. Appellees Edward Mardigian, Grant Mardigian, and Matthew Mardigian, decedent's brother and nephews, respectively, challenged the introduction of these documents into probate, as did two of decedent's nieces, appellees Susan Lucken and Nancy Varbedian, and decedent's girlfriend, appellee Melissa Goldberg. At the same time, various appellees, primarily appellees Edward, Grant, and Matthew Mardigian, contended that subsequent writings by decedent, namely a letter with what appellant termed "dubious" handwritten notes should be submitted instead, as writings intended to be a will, and as an amendment to decedent's trust.
Following discovery, appellees Edward, Grant, and Matthew Mardigian moved for partial summary disposition and asked the probate court to void all gifts contained in both the trust and the will to appellant and his children, as a matter of law. Edward, Grant, and Matthew Mardigian argued that the gifts were against public policy, as evidenced by the MRPC, specifically MRPC 1.8(c), which provides, "A lawyer shall not prepare an instrument giving the lawyer or a person related to the lawyer as parent, child, sibling, or spouse any substantial gift from a client, including a testamentary gift, except where the client is
After the probate court granted the motion for summary disposition, the matter proceeded toward a scheduled jury trial. On the date of the scheduled trial, the probate court denied appellant's motion for a stay under MCL 600.867(1); however, the probate court and other parties agreed that appellant could continue to participate in the subsequent proceedings. For reasons not clear in the record, appellant decided not to continue to participate in the proceedings. Thereafter, the other parties reached a settlement concerning the distribution of funds and the jury was excused. This Court subsequently denied appellant's motion for a stay, and denied reconsideration.
We review de novo a trial court's ruling on a motion for summary disposition. Dillard v. Schlussel, 308 Mich.App. 429, 444, 865 N.W.2d 648 (2014).
We also review de novo the proper interpretation of trusts and wills, as well as the interpretation of statutes. In re Stan Estate, 301 Mich.App. 435, 442, 839 N.W.2d 498 (2013).
In In re Powers' Estate, 375 Mich. 150, 157, 176, 179, 134 N.W.2d 148 (1965), our Supreme Court held that a will, devising the bulk of the estate to a member of the family of the attorney who drafted the will, and also naming the attorney as an additional beneficiary, was not necessarily invalid. Rather, in such circumstances, a question of undue influence exists, such that undue influence arising from the relationship is presumed to have been exerted as the means to secure the testamentary gift. Id. at 179, 134 N.W.2d 148. In remanding for further proceedings, the Powers Court stated:
In his concurrence, Justice SOURIS further noted that:
Powers is directly on point with the facts presented in the instant case and, as such, is binding on this Court.
Although we remand for further proceedings, we further address the significant policy questions presented by this case. First, appellees note that in In re Karabatian's Estate, 17 Mich.App. 541, 170 N.W.2d 166 (1969), this Court held a will to be void as against public policy under similar facts. But, we find that the Karabatian Court erred by failing to follow Powers as binding precedent, and, as a pre-1990 decision, we are not bound by Karabatian. MCR 7.215(J)(1); Administrative Order No. 1990-6. In addition, even if Karabatian may have correctly foretold the outcome to be reached by our Supreme Court should it decide to consider a case with such facts as are presented here, we lack the authority to overrule Powers:
Second, appellees rightly recognize that MRPC 1.8(c) expressly prohibits the conduct at issue here. Based principally on (1) the adoption of this provision, (2) the fact that our Supreme Court has ruled that "public rules of professional conduct may also constitute definitive indicators of public policy," Terrien v. Zwit, 467 Mich. 56, 67 n. 11, 648 N.W.2d 602 (2002), (3) the fact that contracts entered into in violation of the MRPC have been found unenforceable, Evans & Luptak, PLC v. Lizza, 251 Mich.App. 187, 189, 650 N.W.2d 364 (2002), and (4) the enactment by the Legislature of MCL 700.7410(1) and MCL 700.2705, appellees argue, separate and apart from the Karabatian decision, that the devises to appellant and his children were void as against public policy. If appellees were correct that MCL 700.7410(1) and MCL 700.2705, together with MRPC 1.8(c), make it clear that the public policy of this state prohibits an attorney or specified relative from receiving a devise from an instrument prepared by the attorney for a client, this case might be distinguishable from Powers. However, we conclude that appellees' argument is unavailing.
Terrien established only that "public rules of professional conduct may also constitute definitive indicators of public policy." Terrien, 467 Mich. at 67 n. 11, 648 N.W.2d 602 (emphasis added). Accordingly, while the violation of MRPC 1.8(c) is clearly unethical conduct, it is not clearly conduct against public policy. Moreover, as noted in the commentary to MRPC 1.0:
The limitations noted in the commentary to MRPC 1.0 and in Terrien (that a violation of the MRPC may constitute a definitive indicator of public policy) are important considerations in the instant case, because contracts, the legal instrument at issue in Lizza, are distinctly different from trusts and wills, which are at issue in this case.
A will is generally not a contract. 1 Williston, Contracts (4th ed.), § 1:7, p. 48. Wills and contracts are different in nature, most notably in that they derive their binding force from differing sources. Finburg, Wills — As Distinguished from Common Law Contracts, 16 BU L. Rev. 269, 272 (1936). Whereas a contract is "an agreement between parties for the doing or not doing of some particular thing and derives its binding force from the meeting of the minds of the parties," 95 CJS, Wills, § 188, p. 185, a will is "a unilateral disposition of property acquiring binding force only at the death of the testator and then from the fact that it is his or her last expressed purpose, and a will, although absolute and unconditional, cannot be termed a contract," id. (citation omitted). It is this difference that gives rise to the separate and distinct rules applied to interpret
While trusts and wills "are not the same, and different legal rules govern each," 90 CJS, Trusts, § 1, p. 130, under Michigan law, courts apply the same rules of interpretation to trusts and wills, Reisman, 266 Mich.App. at 527, 702 N.W.2d 658. The primary goal of interpreting wills is to give effect to the testator's intent as long as it is lawful. See Wanstead v. Fisher, 278 Mich. 68, 73, 270 N.W. 218 (1936) ("It is elementary that the cardinal principle in the interpretation of wills is to carry out the intention of the testator if it is lawful and can be discovered; and that the whole will is to be taken together and is to be so construed as to give effect, if it be possible, to the whole."); Sondheim v. Fechenbach, 137 Mich. 384, 387-388, 100 N.W. 586 (1904) ("The general rule for the interpretation of wills is that it is the duty of courts to give full and complete effect to the testator's intention, and carry out such intention if it be lawful.") (quotation marks and citation omitted). Similarly, in interpreting trusts, "the probate court's objective is to ascertain and give effect to the intent of the settlor." In re Stan Estate, 301 Mich.App. at 442, 839 N.W.2d 498. The devises to the appellant and his children are not, on their face, unlawful devises. Therefore, they can only be invalidated as unlawful if they are definitively against public policy. No statute, including MCL 700.7410(1) and MCL 700.2705, renders these devises as definitively contrary to public policy. Decedent's purported intent, to transfer assets to appellant and appellant's children, is not per se unlawful, as demonstrated by the fact that, had an independent attorney drafted the documents rather than appellant, there was nothing illegal about the devises. Rather than the purpose of the devises being illegal, it is the fact that the person drafting the documents did so contrary to the letter and spirit of the rules of professional conduct that raises suspicion regarding the validity of the devises.
In sum, there are valid policy reasons why our Supreme Court could reembrace the rule enunciated in Powers and conclude that it is appropriate to treat a trust or will, drafted in clear violation of the MRPC, differently than a contract drafted in violation of the MRPC would be treated.
Finally, the statutory scheme provided by the Legislature suggests that the contestant of a trust or will must establish, inter alia, undue influence in order to invalidate the trust or will. MCL 700.2501 provides as follows:
The right to contest a will is statutory and "[a] contestant of a will has the burden of establishing lack of testamentary intent or capacity, undue influence, fraud, duress, mistake, or revocation." MCL 700.3407(1)(c). That is, the testator's capacity to make a will is presumed. See also In re Skoog's Estate, 373 Mich. 27, 30, 127 N.W.2d 888 (1964). And whether a testator had the requisite testamentary capacity "is judged as of the time of the execution of the instrument, and not before or after, except as the condition before or after is competently related to the time of execution." Powers, 375 Mich. at 158, 134 N.W.2d 148. Similarly, a trust is created only if the settlor has capacity to create a trust and the settlor indicates an intention to create the trust. MCL 700.7402(1)(a) and (b). "A trust is void to the extent its creation was induced by fraud, duress, or undue influence." MCL 700.7406.
"To establish undue influence it must be shown that the grantor was subjected to threats, misrepresentation, undue flattery, fraud, or physical or moral coercion sufficient to overpower volition, destroy free agency and impel the grantor to act against his inclination and free will." In re Karmey Estate, 468 Mich. 68, 75, 658 N.W.2d 796 (2003) (quotation marks and citation omitted). Motive, opportunity, or the ability to control, without proof that it was exercised, are insufficient to establish
As this Court has further explained:
The framework adopted by our Legislature attempts both to honor the actual intent of the grantor and protect against abuse. Because appellant was decedent's fiduciary, because he benefited from the transaction with decedent, and because, as the drafter of the documents, he had an opportunity to influence decedent's decision in that transaction, it is presumed he exerted undue influence in securing the devises at issue. However, caselaw and existing statutes afford appellant the opportunity to attempt to prove by competent evidence that the presumption of undue influence should be set aside, and that in fact the devises represent the unfettered and uninfluenced intent of decedent.
On the basis of the binding precedent of our Supreme Court in Powers and for the other reasons stated in this opinion, we reverse and remand to the Charlevoix Probate Court for proceedings consistent with this opinion. As the prevailing party, appellant may tax costs under MCR 7.219.
STEPHENS, J., concurred with WILDER, P.J.
SERVITTO, J. (dissenting).
I respectfully dissent. The majority is correct that In re Powers' Estate, 375 Mich. 150, 134 N.W.2d 148 (1965), stands for the proposition that instruments drafted by an attorney that propose to give a gift or devise to the attorney or the attorney's family members may be appropriate as long as the gift or devise does not result from undue influence.
However, Powers was decided long before the 1988 adoption of the Michigan Rules of Professional Conduct (MRPC), or even the predecessor of those rules, the Code of Professional Conduct, which was adopted in 1971. See Evans & Luptak, PLC v. Lizza, 251 Mich.App. 187, 194, 650 N.W.2d 364 (2002). MRPC 1.8(c) now specifically prohibits this conduct. Moreover, this Court has held, in the context of a referral fee contract sought to be upheld by the attorney, a contract is unethical when it violates the MRPC, and "unethical contracts violate our public policy and therefore are unenforceable." Lizza, 251 Mich.App. at 189, 650 N.W.2d 364.
The Lizza Court agreed with our Supreme Court's conclusion that "[i]t would be absurd if an attorney were allowed to enforce an unethical fee agreement through court action, even though the attorney
With respect to public policy issues, our Supreme Court has stated:
The Terrien Court also stated, "We note that, besides constitutions, statutes, and the common law, administrative rules and regulations, and public rules of professional conduct may also constitute definitive indicators of public policy." Id. at 67 n. 11, 648 N.W.2d 602 (emphasis added). In fact, our Supreme Court is charged with promulgating the rules regarding the ethical conduct of attorneys in Michigan. MCL 600.904 provides:
It also has "the authority and obligation to take affirmative action to enforce the ethical standards set forth by the Michigan Rules of Professional Conduct...." Speicher v. Columbia Twp. Bd. of Election Comm'rs, 299 Mich.App. 86, 91, 832 N.W.2d 392 (2012). Because "the Legislature delegated the determination of public policy regarding the activities of the State Bar of Michigan to the judiciary pursuant to MCL 600.904 ..., conduct that violates the attorney discipline rules set forth in the rules of professional conduct violates public policy." Id. at 92, 832 N.W.2d 392.
I would also note that while the majority cites the presumption of undue influence with respect to trusts and wills as a protection, the majority does not adequately address MCL 700.7410(1), governing trusts, which provides:
MCL 700.2705 similarly provides:
Thus, once the trial court has found the terms of a trust or instrument of disposition to be contrary to public policy the legal effect of the instrument is a foregone conclusion and the meaning of the instrument is no longer open to interpretation or subject to dispute concerning intent. Given these statutory provisions, longstanding caselaw, and the language of MRPC 1.8(c), I disagree with the majority's conclusion that Powers requires remand for further proceedings in which appellant would be required to overcome the presumption of undue influence. I would instead hold that the trial court did not err when it determined that the devises to appellant and his children in the June 8, 2011 will and the August 13, 2010 trust were void as against public policy and I would affirm.