In re Estate of Peppler
In In re Estate of Peppler, 971 P.2d 694 (Colo.App.1998), the testator in 1984 executed a will leaving $ 40,000 to his daughter, and most of the balance of his estate to his son. That will contained a no contest clause. After the testator died, his daughter filed a petition for probate of a 1992 will that contained provisions more favorable to her than those in the 1984 will. The personal representative objected to admitting the 1992 will to probate. After a three-day bench trial, the district court denied admission of the 1992 will to probate, finding that testator lacked testamentary capacity to execute it and that it was the product of undue influence exerted upon testator by his daughter. The personal representative then brought an action to enforce the no contest clause in the 1984 will against the daughter. He contended the daughter's attempt to admit the 1992 will to probate constituted an attack on the 1984 will within the meaning of the no contest clause and that therefore she forfeited her right to the $ 40,000 bequest.
The trial court declined to order enforcement of the no contest clause. The Court of Appeal, however, reversed and remanded, concluding that further proceedings were required to determine whether the no contest clause should be enforced.
The court held that the offer of a subsequent will for probate did constitute an attack on the prior will, triggering the no contest clause. However, the court also held that the finding of undue influence does not, as a matter of law, preclude applying a good-faith probable-cause exception to enforceability of no contest clauses. The court explained, "Courts have generally declined to enforce no-contest clauses where the beneficiary challenging the will acted in good faith and had probable cause for the challenge. 'Probable cause,' in the context of attacks on wills, is defined as 'the existence, at the time of the initiation of the proceeding, of evidence which would lead a reasonable person, properly informed and advised, to conclude that there is a substantial likelihood that the contest or attack will be successful.' One factor which bears on the existence of probable cause is that the beneficiary relied upon the advice of disinterested counsel sought in good faith after a full disclosure of the facts. The good faith-probable cause exception to enforcement of a no-contest clause has been applied in cases where the asserted attack or contest consists of offering a later will for probate. . . .
The personal representative contends that the probable cause exception cannot apply here because the district court's finding of undue influence on the part of beneficiary established as a matter of law that beneficiary was not acting in good faith or with probable cause when she sought admission to probate of the 1992 will.. . .We decline to hold that, as a matter of law, a finding of undue influence precludes applying the good faith-probable cause exception. Under the particular facts and circumstances of a given case, there may be a basis for concluding that a beneficiary acted in good faith and with probable cause in offering a will for probate, even if it is later determined that the will was the product of undue influence.We cannot determine from the record before us whether this is such a case.
The transcript of the bench trial regarding the 1992 will is not included in the record on appeal. The district court found at the conclusion of that trial that beneficiary had been 'well-intended in trying to do what she thought was right and best'; that it would not attribute any negative motive to her; that it thought the evidence showed the attorneys 'plotted this whole scenario and left beneficiary holding the bag'; and that she was simply following the advice she had been given. One year later, in ruling on the personal representative's request regarding enforcement of the no-contest clause, the court again found that beneficiary was well-intended but had been badly advised by her attorneys.These findings indicate that the court believed beneficiary was acting in good faith when she obtained the 1992 will. However, while good faith is a relevant consideration, the court's findings do not fully resolve the issue of whether there was probable cause for offering the 1992 will for probate under the standards for probable cause set forth above. For example, the definition of probable cause contemplates a determination of whether a 'reasonable person, properly informed and advised' would have concluded that the petition for probate of the 1992 will would succeed. Such a determination must be made in the first instance by the district court." ( In re Estate of Peppler, supra, 971 P.2d at pp. 697-698.)
Accordingly, the Court of Appeal remanded the cause to the district court for a determination of whether there was probable cause for institution of the proceedings regarding the 1992 will.