American United Life Insurance Company et al v. Mays et al

Filing 52

MEMORANDUM OPINION AND ORDER: The Court GRANTS the Plaintiffs' Motion to Deposit, provided that the Benefits are deposited with the court's registry within fourteen (14) days of the date of entry of this Memorandum Opini on and Order, after which deposit the Plaintiffs are DISMISSED from this action. The court GRANTS IN PART AND DENIES IN PART Defendant Mays's Motion to Strike. Specifically, the court FINDS that Defendant Whitney has insufficiently pled duress and undue influence and STRIKES those defenses, but GRANTS leave to amend thereto. Any amended pleading shall be filed with the court within twenty-one days of the date of entry of this Memorandum Opinion and Order. The co urt FINDS Defendant L. Veale has insufficiently pled duress and undue influence under a confidential relationship theory and STRIKES those defenses, but GRANTS leave to amend thereto. Any amended pleading shall be filed with the court within twenty-one days of the date of entry of this Memorandum Opinion and Order. The court DENIES Defendant Mays's request for a determination that interpleader is not appropriate. Defendant Lentz is DISMISSED from this action. Signed by Chief District Judge Rebecca Beach Smith on 7/31/17. (Copies distributed as directed 7/31/17)(afar)

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FiLED JUL 3 1 2017 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF VIRGINIA Norfolk Division CLERK, US DiSTRlCT COURT NORFOLK, VA AMERICAN UNITED LIFE INSURANCE COMPANY AND THE STATE LIFE INSURANCE COMPANY, Plaintiffs, CIVIL ACTION NO. V. SAHDE Z. MAYS, 2;17cv99 Individually and as Trustee of the Restated Robert Veale Living Revocable Trust, TIMOTHY E. LLOYD T. WHITNEY, JR., VEALE, AND STEPHEN LENTZ, Defendants. MEMORANDUM OPINION AND ORDER This for matter Receipt Deposit"), Life and Insurance The Deposit Company of the court Defendants' argument and time in this to on the Interpleader The the "Plaintiffs") response was received. oral before and accompanying Memorandum, (collectively, 20. comes Life on March 31, Additionally, matter. Funds" ECF Motion ("Motion to filed by American United State respond "Renewed has Insurance 2 017. now Company ECF Nos. expired, and 19, no the Plaintiffs have waived No. Motion to Deposit is now ripe for review. 30. Accordingly, the Also before Affirmative Veale" Defenses ("Motion Support, the filed on May was Defendant filed Lloyd 34, subject Veale to by Jr. and the Lloyd T. Memorandum in Sahde Mays Defendant Timothy Whitney 37, 38. defect, ("Defendant Strike Defendant Response ECF Nos. to accompanying 35. his "Motion Whitney, 2017, filed 2017. E. and 4, ECF Nos. Whitney") the Timothy Strike"), Support on May 15, Strike of is to ("Defendant Mays"). {"Defendant court L. and Memorandum However, in the Motion to regard Veale"), in to se failure for pro to include a notice consistent with the requirements of Roseboro v. Garrison, 528 F.2d 7 (K) . ECF No. 39. 309 (4th Cir. file a and Local Civil Rule The defect was corrected by Defendant Mays on May 26, 2017. S^ ECF Nos. 43, not 1975), 44. Defendant L. Veale still did response to the Motion to Strike. Accordingly, the Motion to Strike is now ripe for review, I. In October of 2014, Robert H. Veale ("Robert") life insurance policies from the Plaintiffs, collectively worth Ex. 1, ECF beneficiaries daughter; Veale, No. $700,000. No. 1-1; of Defendant Whitney, 1-2; Ex. 4, ECF Am. No. which policies are Am. Compl. 12-25, ECF 1-3. The original Defendant Mays, Robert's policies Robert's brother. two 3, Ex. these bought No. were Robert's cousin; Compl. 17-18, 1-4. On December ECF No. and Defendant 24-25; 18, Ex. 2015, 2, 29; L. ECF Robert established "Trust"), the for Robert H. Veale which Robert served for which Robert's attorney, Lentz"), Am. tn 26-29; the Trust trustee original (the and Defendant Stephen Lentz ("Defendant transfer ownership 5, ECF No. 1-5. On July submitted purportedly change as Living would serve as the successor trustee on Robert's death. Compl. Robert Revocable Ex. documentation attempting of the two the beneficiaries of policies to the policies the 25, 2016, to and Trust to the Trust. (1) (2) Neither change was recorded by the Plaintiffs on the basis that "proper and complete 30-37; No. 1-8; Ex. Ex. On documentation" 6, 9, 23, trust instrument dated replace 1-6; 2016, the Am. is not Ex. 7, submitted. ECF No. Am. 1-7; Compl. Ex. 8, ECF 1-9. "Declaration of restated the Trust. ("This No. ECF No. November issued a ECF was six days Trust," Compl. a 18th, original trust HI 2015, and his death, Robert which purportedly amended and complete December before 38-39; Ex. 10, of restatement and any is the intended subsequent the original trust."). On this same day, ECF No. 1-10 original to totally restatements to Robert also purportedly signed and submitted another form to the Plaintiffs changing the beneficiaries of to the Trust. the life Am. Compl. insurance 40-41; policies Ex. 11, to be ECF No. 1-11. beneficiary change was recorded by the Plaintiffs, was sent to Robert notifying him of such. transferred Am. and a Compl. This letter 42-43; Ex. 12, ECF change No. 1-12. Both the restated Trust document and in beneficiary form were purportedly signed at Robert's request by another individual.^ Am. Compl. HH 44-45; Ex. 13, ECF No. 1-13; Robert Ex. 23, ECF No. 1-23. and Mavis McKinley, with AMG National Trust The restated Trust in her capacity as Bank a Trust Officer {or any other trust company with which she may be employed), as primary co-trustees. H 49; 1-10. Ex. 10, trustee, at 2, Am. Compl. If Robert ceased to serve as AMG National Trust Bank was designated to serve as the sole trustee. could ECF No. designated serve Financial Ex. as 10, at 2, trustee, Group ("AFG") ECF No. the to 1-10. restated select a If none of Trust these three required professional Anchor successor trustee. Am. Compl. H 49; Ex. 10, at 2-3, ECF No. 1-10. ^ Another of Robert's attorneys, Veronica Williams, drafted the restated Trust document, "presided over the execution of his trust based estate plan, and . . . served as notary public during the bedside execution of his documents." Ex. 13, at 1, ECF No. 1-13. In a "[1]egal opinion letter" to the Plaintiffs, Ms. Williams explains that "another individual" signed the restated Trust direction. name this Id. document at 2. individual, on Robert's Although it Ms. indicates behalf and Williams's the at letter restated Trust Robert's does not document was signed by the agent "newly appointed" under the "Financial Power of Attorney" form, also signed by another individual on Robert's behalf and at Robert's direction, id., which implies that it was Robert's friend, James Battle. See infra at 5-6. Ms. Williams's letter does not specifically explain how the change in beneficiary form was executed, but i t states that "each of [Robert's] estate planning documents" were executed using this "alternative method" as authorized under Virginia law. Ex. 13, at 2, ECF No. 1-13. 4 Robert Ex. 19, died on November 29, ECF No. Battle 1-19. ("Battle") same day. life the "Interim Compl. policies. Am. Compl. 2016, 9, 64-65; AFG appointed James Successor HI 52-53; Battle submitted a insurance No. 1-20. On December 5, as restated Trust. Am. 2016. Ex. 15, Trustee" ECF No. of the 1-15. The claim for the proceeds of the two Am. Battle also provided Compl. the HH 66-67; insurance Ex. 20, companies with a signed "Trust Affidavit" form. Am. Compl. No. 1-21. AMG National Trust Bank declined On December 6, 2016, 68-69; Ex. ECF 21, ECF to serve as trustee of the restated Trust. Am. Compl. tl 50-51; Ex. 8, 14, Battle ECF No. 1-14. requested Trust's name. December nil 54-55; 15, the Am. later, December wired be on to an 75-76; Battle 16, days proceeds Compl. 2016, Ex. Two ECF Ex. resigned No. 1-16. 24, as account ECF No. trustee. AFG and 2016, in the 1-24. Am. On Compl. Defendant Mays subsequently executed the Non-Judicial Settlement Agreement and the Certificate of Successor Trusteeship, appointing Defendant Mays as the successor trustee of the restated Trust. Am. Compl. nn 57-59; Ex. 26, ECF No. 29-1; Ex. 27, ECF No. 29-2. Overlapping the Trust are these changes documents with different vesting individuals. "Durable Power of Attorney" Attorney-in-Fact and with the power On June insurance policies and of 14, attorney 2016, for Robert Robert signed a appointing Defendant Whitney as his Defendant L. Veale as successor should Defendant Ex. 17, Whitney ECF No. be unable 1-17. to serve. On November 23, Am. Compl. flU 60-61; 2016—the same day Robert purportedly had another individual sign the documents restating the Trust and changing the beneficiaries of policies to the Trust—he allegedly the life insurance signed another "Durable Financial General Power of Attorney," which named Battle as his Power of Attorney and "revoke[d] financial powers of attorney, Ex. 18, ECF No. all previously of any sort." Am. executed Compl. 62-63; 1-18. Defendants L. Veale and Whitney challenge the validity of the change in beneficiary form purportedly executed at Robert's behest on November 23, 2016. See Am. Answer of Defendant Whitney [hereinafter "Whitney Am. Answer"] of Defendant L. No. 9; Am. Am. Answer"] Veale Answer 10-11, [hereinafter "L. of Defendant L. ECF No. 31; Answer Veale Answer"] Veale [hereinafter at 1, "L. ECF Veale flU 3-4, ECF No. 47. Accordingly, both Defendants L. Veale and Whitney claim they are entitled to their shares of the proceeds of the insurance policies. Am. Compl. tl 77-78; Ex. 25, ECF No. 1-25; Whitney Am. Answer ^ 12. Defendant Lentz, initial policies trustee at . . . issue." "Lentz Answer"] makes no claim to Answer of Defendant the proceeds Lentz "as the of the [hereinafter H 5, ECF No. 40-1. Defendant Mays also initially questioned the validity of the change in beneficiary form signed on November 23, 2016. See Am. Compl. 6 71-72; Ex. 22, ECF No. 1-22. However, relating to [Robert's] Mays the she has since execution attorney, of Veronica the[] "denies that ^ 7, "the documents Williams." [hereinafter "Mays Answer"] Defendant Mays accepted provided Answer ECF No. explanation of by Defendant 32. Accordingly, the plaintiffs need the assistance of this court to pay out the benefits under their policies." Id. H 8. Based on these claims and disputes, the Plaintiffs brought this action in interpleader. II. The Motion to Deposit^ requests leave to deposit with the court the policies proceeds (the Deposit "Benefits"). also prejudice owed by contains the the Mot. an Plaintiffs from action against the or [the court proceeding Plaintiffs] grants under to Deposit at 1. implied injunction prohibiting any of any Plaintiffs this the request case and Defendants in any state for the recovery of the Motion to Deposit or the The Motion to to dismiss enter from United insurance a with permanent "instituting States court the Benefits," and on payment of if the Benefits into the court's registry. See ECF No. 20-1 at 2-3. ^ The Motion to Deposit was previously granted by the court. See ECF No. 21. However, on reassignment of this case to the undersigned, the order was vacated as premature as the Defendants' time to respond to the Motion to Deposit had not yet expired and the Plaintiffs had a motion seeking leave to file an amended complaint before the court. ECF No. 24. A. "Interpleader is a disinterested stakeholder or more adverse claimants Hartford v. Arcade Cir. An equitable 2002). protect the inconsistent procedural to bring a to a Textiles, Inc., disinterested that allows fund." 40 F. Sec. App'x Ins. 767, 769 stakeholder relieve from it of the interpleader "rule" interpleader under under Federal Rule 28 U.S.C. of Civil of (4th is to "multiple, obligation of Id. are two distinct methods for invoking interpleader in a "statutory" Co. interpleader's purpose determining which claimant is entitled to the fund." court, a single action joining two single remedy, judgments and to device § There federal 1335, Procedure and 22, and each has its own jurisdictional requirements. Here, the Plaintiffs have invoked both statutory interpleader and rule interpleader on the basis of diversity of citizenship. Am. Compl. 7-8. In regard to statutory interpleader, district courts have original jurisdiction actions if: (1) the amount in dispute exceeds (2) over $500; there are two or more adverse claimants of diverse citizenship; and {3} the plaintiff deposits the money or property in dispute into the registry of the court or posts an adequate bond. 28 U.S.C. § 1335. Section 1335 has been "uniformly construed to require only 'minimal diversity,' that is, diversity of citizenship between two or more claimants, without regard to the circumstance that other rival claimants may be co-citizens." Tashire, State 386 U.S. 523, Farm 530 Fire (1967). & Cas. Co. v. Allstate Life at . *2 . (E.D. . is Ins. Va. a Co. Feb. v. Ellett, 4, 2015). procedural No. "By contrast, device therefore be proper under 28 2:14cv372, only, U.S.C. and § 2015 WL 500171, rule interpleader jurisdiction 1331 must (federal question jurisdiction) or § 1332 {diversity jurisdiction)Id. Regardless of the mechanism used to invoke interpleader, interpleader the court invoked action generally proceeds must determine interpleader, whether threatened with equitable double concerns the including jurisdiction over the suit, is {6th Cir. appropriate, the or multiple further liability,' claimants from court." I^ F.3d at 641). "Once a court stages. plaintiff 'has the the liability, use of and (citing 28 "may interpleader.'" Prods., Inc., discharge related actions U.S.C. § 2361; In the second stage, No. WDQ-10-2809, whether any Id. 497 F.3d 637, the plaintiff from and may enter an injunction restraining the litigating and has court determines that interpleader 'normal litigation processes, motions, properly court in state trial.'" 2011 Metro. WL 2133340, 9 or High Tech. federal Prods., 497 "the case continues between the claimants to determine their respective rights the "First, whether the stakeholder is actually prevent 2007)). two whether (quoting United States v. High Tech. 641 in an . including pleading, Life at *2 Ins. {D. Co. Md. May . . [via] discovery, v. 25, Vines, 2011) (quoting High Tech. Ins. Co., Prods., 2015 WL 500171, 497 F.3d at 541); see Allstate Life at *2. B. Here, the invoking both Benefits $500 the Plaintiffs statutory and $75,000 diversity interpleader: Mays is a of of for First, the which exceeds both the statutory statutory interpleader and that applies of § 1332 interpleader and that to The Plaintiffs are citizens of residents Plaintiffs interpleader. for for requirement resident requirements to diversity is satisfied under both the standard resident of Florida, are the jurisdiction requirement rule interpleader. Second, complete all $700,000, requirement diversity diversity met rule in controversy total jurisdictional minimal have New Jersey, applies Indiana; Defendant L. the rule Defendant Veale is a and Defendant Whitney and Defendant Lentz Virginia. Am. have asserted that Compl. 1-7. Third, they stand ready to deposit the the Benefits with the court, as is required under statutory, but not rule, interpleader. Moreover, potential the Plaintiffs conflicting conflicting claims." legitimately claims, Allstate but Life. actual, Ins. Co., fear and 2015 "not just colorable, WL 500171, at *3. The Plaintiffs have received letters staking claim to all or some case. Am. of the Compl. Benefits 66, from at least two Defendants in this 77. Although this stage does not require 10 inquiry into the merits of each claim, Co., 2015 WL 500171, court should claimants claims determine had must at *3 both not at the first stage "'valid' so wanting in whether substance to 232 F.2d 811, Strike Benefits does 813 not {9th Cir. justified. two the that interpleader Life Ins. Co. v. 1956). Defendant Mays's Motion demonstrate are so wanting the claims"), competing under the statute may not be justified," N.Y. Lee, Ins. (rejecting claimant's assertion that presented "be see Allstate Life. that all in substance See infra Parts III-IV. other to the interpleader that claims is not Accordingly, the Plaintiffs' fear of multiple lawsuits is legitimate. Finally, equitable there are no facts to suggest that there are any concerns Accordingly, the weighing Plaintiffs against have properly and the court GRANTS the Plaintiffs' that Opinion (14) and days Order, of the a date $700,000 plus accrued interest until the date of deposit represent the Benefits deposit, the Defendants prosecuting any judicial of certified in from with dispute are interpleader. invoked interpleader court's registry, entry check of in within this Memorandum the amount of the date of Robert's death the in ENJOINED proceeding of Motion to Deposit provided the Plaintiffs deposit with this fourteen use court, this action. from against which the proceeds Upon such instituting Plaintiffs or in any State or United States court pertaining to the Benefits in 11 dispute in this action. Additionally, upon such deposit, the Mays argues that sufficiently pled Plaintiffs are DISMISSED from this matter. III. In the Defendants duress, Motion L. Veale undue Virginia to Strike, and Whitney influence, law to Defendant and challenge have lack the not of mental validity capacity of the under change in beneficiary form dated November 23, 2016. Mot. to Strike IIH 1-4; Mem. Supp. identify which Mot. the she to Strike particular moves the and court language, under Rule from a 12(f), pleading immaterial, 4-5. to Defendant Rule Federal Defendants Whitney and L. title at of strike the court Procedure answers construes that insufficient impertinent, Civil does and the under of By its Motion to Strike court may strike "[t]he defense not defenses Veale for being insufficient. which provides an the Mays or any or scandalous matter." Fed. redundant, R. Civ. P. 12(f) . The 12(f) No. district motions. 2:14cv373, court has "broad Certusview discretion" Techs., 2014 WL 12591937, at *4 When reviewing a motion to strike, LLC {E.D. to v. Va. Seidel, (E.D. Va. Oct. 26, P.A., 2009) No. Dec. 15, LLC, 2014). the court views the pleading I:09cv833, Law Offices 2009 WL 3583606, (quoting Clark v. Milam, 12 Rule Usic, in the light most favorable to the pleader. Kalos v. of Eugene A. decide at *3 152 F.R.D. 66, 71 (S.D.W. typically Charles Va. 1993)). grant leave Alan Wright Procedure § 1381 to If amend & Arthur (3d ed. the motion the R. Id. Federal see Fed. ("The court should freely give leave granted, pleading. Miller, 2004)); is R. (citing Practice Civ. [to amend] courts P. 5C and 15(a)(2) when justice so requires."). Additionally, on diversity of because this court's citizenship and rule interpleader, the adequacy of the jurisdiction here rests under both statutory interpleader the court applies Virginia law to assess substantive elements of the defenses, but employs federal procedural law to weigh the sufficiency of the factual V. allegations supporting the defenses. Jobar Int'l, Va. Apr. 16, Inc., No. 3:14cv50, See, 2014 WL 1513289, e.g., Fields at *1 (E.D. 2014). IV. The court addresses separately the sufficiency of Defendant Whitney and Defendant L. Veale's pleadings. A. Defendant Whitney Defendant Whitney pleads as follows: 10. The Plaintiffs should not release the funds to the Restated Robert H. Veale Living Revocable Trust because Robert H. Veale was subject to undue influence, duress and constraints by James Battle, Barry Farr and representatives of Anchor Financial Group at the time that Robert H. Veale allegedly signed the designation of Beneficiary Change form (Exhibit 10 to Plaintiffs' Complaint), purporting to 13 name the Restated Robert Trust as the beneficiary. 11. The Robert Plaintiffs H. Veale H. Veale should not Trust Living release because the Robert Revocable funds H. to the Veale was terminally ill, was under the influence of narcotic pain medication and did not possess sufficient mental capacity to execute the signed designation of Beneficiary Change form (Exhibit 10 to Plaintiffs' Complaint) purporting to name the Restated Robert H. Veale Living Revocable Trust as the beneficiary. Whitney Am. Answer ^ Response that "[p]aragraph 10 sets forth the legal claims while [p]aragraph 11 sets . . . 10-11. Defendant Whitney clarifies in his rel[ies]." forth some of Mem. Supp. the Resp. facts at 10. upon which Whitney Accordingly, the only defenses pled by Defendant Whitney and challenged by Defendant Mays are duress and undue and, consequently, Rule of Civil the influence. heightened pleading Procedure particularity requirement, 84 F. Supp. 2d 736, Both are species of fraud 739 9 (b) , apply. (W.D. Va. as See standard of well King v. 2000) as Virginia's Donnkenny, fraud, Eng'q with particularity." Servs., OneWestBank, (E.D. fraud.' Va. As 467 F.S.B., Feb. such, Tabb V. Willis, 12, S.E.2d No. (citing Mortarino v. 778, 782 3:09cv699, 2010) ("'Undue (Va. 2010 a 1996))); WL influence 538760, is a 563 14 (Va. species Consultant Davis at *4 species i t must be pled with particularity." 156 S.E 556, Inc., ("Federal Rule of Civil Procedure 9 requires that the Plaintiff plead duress, of Federal v. n.3 of (quoting 1931))). Defendant Whitney requests leave to amend should the court strike any of his party to the defenses. Mem. Supp. Resp. at 12. In Virginia, duress is present when "one transaction is prevented from exercising his free will by reason of threats made by the other and . by reason of such f a c t . . . . of Soc. App. (Va. Ct. Servs. 1986) omitted); Nelson 1943248, at *2 has pled not particularity Specifically, v. (Va. all the has App. Record Aug. by failed Father, quotation elements required he Unknown Nelson, Ct. the contract is obtained to constitute duress." {internal v. . Authorities are in accord that the threatened act must be wrongful Div. . of 16, 9(b) allege individuals he claims exerted duress, S.E.2d marks 533, and 541 citations 0603-05-2, 2005). duress, Rule to No. 345 Norfolk 2005 WL Defendant Whitney let alone and with Virginia any wrongful namely Battle, act the law. by the Barry Farr ("Farr"),^ or APG's representatives, that destroyed Robert's free will. Although Defendant Whitney now states in his Response that the narcotic medication destroyed Robert's Supp. AFG's Resp. at 10, participated administering this medication. or a in Furthermore, any 15 Farr, decisions stead, friend of Robert's. 1. see Mem. or for under Virginia law, party bringing suit in his ^ Farr appears to be a Answer a t will, he makes no allegation that Battle, representatives only Robert, free can assert See L. Veale duress. See Norfolk Div. of Soc. Servs., 345 S.E.2d at 541 ("The general rule is that duress must have been exercised upon him or her who sets it up as a defense, of the contract, knowledge." by him who claims the benefit or by someone acting in his behalf or with his (internal quotation marks and citations omitted)). Even if Defendant Whitney could assert duress on Robert's behalf under some exception to any such exception. this general he does {stating See id. rule, the not "general allege rule" for pleading duress as a defense to a contract). Virginia law also requires that the person pleading duress (here, Whitney) also duress (here, exerted allege how Battle, the party Farr, or purported AFG's not alleged. See alleged that Battle, id. Alternatively, Farr, or AFG's have representatives) benefitted from the change in beneficiary—which, has to again, Whitney Whitney could have representatives put Robert under duress on Defendant Mays's behalf or with her knowledge, and pled Because how she Whitney benefitted did not from make the any change such in beneficiary. allegations, he has insufficiently pled duress as a defense. See generally id. Under that the destroyed." Virginia free agency Parfitt v. Acknowledging difficult law, to that "undue of influence the Parfitt, contracting 672 S.E.2d 827, 829 a party "[d]irect proof produce," requires Virginia 16 of undue courts has (Va. influence have showing been 2009). is identified often two situations that are deemed "[w]here great weakness concurs with gross inadequacy of consideration, of suspicion, the brought about Turnbow, 639 person cannot so by undue in as a to accept 293 such an to the nature connection, their obtained." Id. (citing be Id. of habitual risk, a of of mind have Bailey v. "[w]here one confidence influence been towards over him, benefit he without degree proportioned to the having Bailey, Second, personal in a to {citing special once or circumstances presumed 2007)). person exposing himself of (Va. relationship acquire from will influence." S.E.2d 291, stands another, transaction and, a shift the burden of production to the proponent of First, destroyed, that established, Id. was show party's contract." agency to contracting the free "sufficient it 639 set aside S.E.2d at as 293). unduly "These principles apply to gratuitous transfers as well as contracts." Id. Defendant Whitney has also insufficiently pled the elements of undue influence, Rule 9 (b) and let alone with the particularity required by Virginia law. In the first instance, Defendant Whitney has alleged weakness of mind, Answer H 11 insufficient facts that suspicious although see Whitney Am. (alleging influence of narcotic pain medication and mental would capacity), he suggest gross circumstances. With 17 has not inadequacy respect alleged of to any other consideration or the confidential relationship Whitney those has that theory named of undue Battle, exerted the influence, Farr, undue although and AFG's influence Defendant representatives over Robert, see as id. H 10, he has not alleged that any of these individuals stood in a relationship identified of the special nature Defendant Whitney does of not confidence such towards Robert relationship. allege how Battle, nor Additionally, Farr, and AFG's representatives benefitted from the change in beneficiary. Defendant Whitney claims that his Amended Answer pleads that "parties around Robert Veale destroyed the free will of the terminally ill Robert Veale and/or that it had been destroyed by the medication Defendant was Whitney's See Whitney Am. Answer he had so under." Amended Answer Mem. Answer 10-11. explicitly Supp. stated, does Second, the this court cannot find a Defendant Whitney pointed to any, at not even Amended allege how the parties around Robert Third, Resp. 10. First, state this. if the Amended Answer destroyed his does free single Virginia case, not will. nor has holding that the influence of narcotic pain medication on its own is sufficient to destroy the free will of an individual so as to give rise to a presumption of undue influence. Defendant Whitney also now claims that undue influence presumptively exists due to Defendant Mays's relationship with her father and her role as the trustee of the restated Trust. Mem. Supp. Resp. 18 at 10-11. However, Defendant Whitney's Amended Answer makes no such allegations with respect to Defendant Mays, Whitney Am. and that is the pleading at issue here. Answer 10-11. Therefore, Defendant See Whitney has insufficiently pled undue influence as a defense. B. In determining pleads duress, court Defendant L. whether Defendant undue influence, refers to both Order of June 6, his 2017, Veale L. Veale sufficiently or lack of mental capacity, Answer at 2-3, and his ECF No. Amended 46 Answer. the See (stating his Amended Answer incorporates by reference his original Answer); L. Veale Am. Answer t principles by change Veale pled which his decisions." is Fed. R. articulated sufficiently act(s) 3; mind L. also Virginia law, as Battle unable Answer to 10(c). Applying Defendant he fails and concerning Veale P. above. duress ''Mr. Civ. Mr. Trust at assert 1. to L. and Veale allege Farr" property on legal has the "caused Additionally, duress the not wrongful Robert management Defendant Robert's to behalf L. under and/or has not identified any applicable exception to that general rule.^ Defendant L. Veale has, however, sufficiently pled undue influence by alleging with particularity great weakness of mind and suspicious circumstances. See supra at 14-16. 19 First, Defendant L. Veale discusses in detail his concerns for Robert's decision-making abilities; On two occasions Williams I approached and advised her that I lawyer felt that [Veronica] Robert could not make rational and sound decisions concerning his estate/trust and his physical care and wellbeing. Robert was in extreme pain, on strong medication, refused to hire a 24-hour health care provider (would only pay for 8-hour care even though his insurance would pay for 24-hour care), would not provide me with sound guidance on paying his bills and taxes and spoke to myself and others about his committing suicide. L. Veale Answer at 1. He also alleges suspicious circumstances, asserting that the signatures on the restated Trust document and change in beneficiary form, to be forgeries, see id., both dated November 23, [with] letter of 2016. See id. which lawyer Williams removed me, resignation, appear and questioning the last-minute nature of the documents dated November 23, speed 2016, as Trustee and ("Based on the without a replaced formal me with Mr. Battle suggests that lawyer Williams was not willing to have Robert evaluated to determine his mental and physical competency to make independent decisions."); L. Veale Am. Answer t did Mr. Gonzalez death, when [of AFG] Robert was physically incapacitated wait until Robert was a heavily medicated, ("Why few days from when (could not sign own name) 3 Robert was to bring the change of beneficiary document/s to Robert and then have someone else sign Robert's name? Mr. to bring any oversight on Gonzalez had more than enough time Robert [']s 20 part to me (the acting CO-trustee) and/or Robert in a timelier questions the disposition of the assets. H 4 manner.") See L. He Veale Am. also Answer ("At one of the meetings I had with Robert in the Sept/Oct 2016 period, in the presence of Lawyer Williams, Mr. Gonzalez and others, Robert stated that he absolutely did not want Sahde Z. Mays to benefit in created to support any way his from his granddaughter Trust. and his The Trust was granddaughter's offspring."). Further, that Defendant appear to communicating see Ex. 1, support with ECF L. Veale these Gonzalez (renewing insurance policies on November 5, Veronica Williams (discussing and Defendant Robert[']s are Veale, stating maneuvering/persuading examined competent estate," by enough a and make for include emails of copies his 5, 22, at 11, 2016 AFG, of all belief to make determine independent/life ECF No. 9-5 between Williams that "because of so called friends unsound "strongly suggest[ing] to documents 2016); with Robert's attorney, condition his him physic [ian] to These request November physical and mental concerning his be L. exhibits ("Gonzalez") ("Williams"),® see Ex. conversation of as allegations. Dimingo No. 47-1 attaches if and he decisions that is death Robert mentally impacting decisions"); as well as a note purportedly signed by Robert that ^ See supra note 1. 21 states that Defendant death when i t occurs, Mays is see Ex. not 4, to be ECF No. informed of Robert's 9-4. Finally, Defendant L. Veale introduces new complications in the timeline insurance exhibits of Robert's policies are a and decision-making Trust: "Certificate of Two of Trust" regarding Defendant and a his L. "Durable life Veale's Financial General Power of Attorney," both executed on September 10, Ex. 5, at 1-10, ECF No. 9-5. 2016. The Certificate of Trust indicates that the Trust was restated on September 10, that there was an attempt to do so. 2016, or at least Id. at 1. Williams served as the notary for both of these documents. Id. at 2, 10. No other party or filing has mentioned the events of September 10, Thus, Defendant by advancing a L. Veale has sufficiently pled undue 2016. influence theory of great weakness of mind and suspicious circumstances, and pleading particular facts in support thereof. To the alternative, influence, to Battle, Veale the Farr, L. Veale advances, relationship in theory of the undue insufficiently pled such theory with respect Williams, that occasions Defendant confidential he has alleges several extent or Gonzalez. Battle and Farr, caused Robert to as Although Defendant friends change Trust and property management decisions his of mind Robert, L. "on concerning that Robert and I made together," L. Veale Answer at 1, mere friendship is not the kind of confidential relationship that 22 can give rise to the presumption of undue influence under Virginia law. Rather, in Virginia, the party asserting [undue influence] must establish . . . an agency relationship in which one party is bound to act for the benefit of another and can take no advantage himself, or between family members when one member bears also an attorney-client relationship to another member, or "when one family member provides financial advice or handles the finances of another family member." Bailey, V. 639 S.E.2d at 293-94 Beckner, 597 S.E.2d 34, {quoting Friendly Ice Cream Corp. 40 {Va. 2004) (emphasis omitted)). With respect to Williams and Gonzalez, to the extent he alleges an individuals agency relationship between these and Robert, Defendant L. Veale does not allege how they benefitted from the change in beneficiary. not sufficiently For these reasons, Defendant L. Veale has pled undue influence under the confidential relationship theory. Defendant L. Veale has capacity on November 23, also pled Robert 2016. As a preliminary matter, mental capacity is not a species of fraud, ex rel. Cash v. (Cir. Ct. fraud as Aug. Fitzgerald, 31, separate requirements of 1992) 28 Va. (listing grounds each), and, Cir. court must determine the 548, 1992 lack of mental for relief and thus. Rule 9(b)'s standard 23 mental lack of see generally Garland pleading with particularity does not apply to the lacked by WL 12024795 capacity and discussing requirement it. which the of Accordingly, to judge the sufficiency of this pleading. for the may Fourth be pleaded sufficient (4th omitted) with held general as long as 2004) (second and Clem v. (internal of "[a]n Bell Atl. Iqbal, Inc. (E.D. were Corp. 556 V. U.S. V. in the Va. Jan. 662, decided, 5, be defense held to be 98 quotation marks original). This United States forth F. App'x 197, and was Supreme citations in accord Court with in Federal Rule of prior to the Supreme Court's decisions in Twombly, Dollar Gen. will Corbeau, respect to the pleading standards set Civil Procedure 8(a) affirmative it gives plaintiff fair notice of alteration decisions that terms the defense." Cir. the has in ... the nature of 203 Circuit The United States Court of Appeals 677 (2009) . Corp.. 2016) however, 550 U.S. No. (2007), Info. J.). Fourth and Ashcroft v. Planning 2:15cv206, (Jackson, the 544 & Mgmt. 2016 WL 69902, Serv. at *3-4 Since Twombly and Iqbal Circuit has not addressed whether the heightened pleading standard of Twombly/Iqbal—that alleged facts, taken as true, plausibly support an entitlement to relief—applies to the pleading of affirmative defenses, district courts are divided on the the Eastern District of Virginia. Inc., 2016 WL 69902, District of Virginia, in the Fourth Circuit, LLC, 2014 WL 12591937, at *4 question, Info. including within Planning & Mgmt. (collecting cases and from Serv. the Eastern as well as from the other district courts and discussing split); Certusview Techs., at *4-5 (same). 24 The majority support the pleading of view of the that decisions Twombly/ Iqbal affirmative defenses Rule of Civil Procedure 8(b)(1)(A) pleading of defenses, from this does because and court, not the (c)(1), apply text LLC, language of 2014 Rule Twombly/Iqba1 defenses) . at this time, 12591937, 8(b)(1)(A) not However, of the Federal "does not track the text of Rule 8(a)(2)," WL does to which governs the which governs the pleading of a claim to relief. Techs., however, at and apply *5 (discussing (c)(1) to See Certusview and the plain determining pleading of affirmative this court need not weigh in on this as here. Defendant L. that issue Veale has sufficiently pled lack of mental capacity even under the heightened Twombly/Iqbal standard. In person, person Virginia, capacity claiming "the to an law presumes contract and exemption that that under there the this is, burden rule is 1961 Chesapeake WL 66110, & 0. Ry. at v. *1 (Cir. Mosby, 24 Ct. Mar. 14, S.E. 916 (Va. reasoning, or mere absence of experience or 1961) incapacity, incapacity." but additional facts, Id. (internal if proven, citations 25 Cir. (citing 1896)). It is immaturity skill upon matter under contract affords per se no ground for a the establish 17 Va. further "well established that mere weakness of mind, of every upon to incapacity." Cent. Nat'l Bank of Richmond v. Warner, 444, in the claim of may establish such omitted). There is no bright-line defining capacity; rather, and requires time, a determination of sufficient consequences S.E.2d 56, of 60 the whether capacity to transaction. the party had, understand Id.; Bailey v. the nature the at and Bailey, 677 (Va. Ct. App. 2009). Defendant Robert's mental the test is fact-specific L. capacity, Veale alleges that he had questions about arising from Robert being in "extreme pain" and "on strong medication," for some time, including the day the change of beneficiary form was signed. See L. Veale Answer at 1; Ex. he 5, at 11, ECF No. questioned decisions," 9-5. Robert's those He alleges capacity being to Robert's specific instances where "make refusal rational and to a hire sound 24-hour health care provider, despite his insurance covering such care, and Robert's to failure bills and taxes." L. provide ''sound guidance Veale Answer at 1. on paying Therefore, his Defendant L. Veale has sufficiently pled lack of mental capacity. V. In summary, Deposit, the provided court that the GRANTS Benefits court's registry within fourteen of this The court Motion GRANTS to IN Strike. Plaintiffs' are (14) Motion deposited with to the days of the date of entry Memorandum Opinion and Order, P l a i n t i f f s are DISMISSED from Mays's the after which deposit the t h i s action. PART AND DENIES Specifically, 26 the IN PART court Defendant FINDS that Defendant Whitney has insufficiently pled duress and undue influence and STRIKES those defenses, but GRANTS leave to amend thereto. pleading be within Any amended twenty-one (21) days shall of the filed date with of the entry court of this Memorandum Opinion and Order.® In regard to Defendant L. Veale, the court FINDS under a theory circumstances, court that he has FINDS of great weakness Defendant those amended L. defenses, pleading twenty-one {21) Veale mind and of for a suspicious However, the insufficiently pled duress but GRANTS leave shall days has influence, confidential relationship theory and be the Opinion and Order.' Further, request of as well as lack of mental capacity. and undue influence under a STRIKES sufficiently pled undue filed date to amend with entry of the of thereto. court this Any within Memorandum the court DENIES Defendant Mays's determination that interpleader is not appropriate. Defendant Lentz seeks dismissal from this suit on the grounds that he makes no claim to the proceeds of the policies at issue in his Lentz Answer at status 2. No as the initial tirustee other party objected to of this the Trust. dismissal. Accordingly, Defendant Lentz is DISMISSED from this action. ® If facts are developed during discovery to support an affirmative defense, Answer to add such a leave of court may be defense. See Fed. ' See supra note 6. 27 R. sought Civ. P. to amend the 15(a). The Clerk is DIRECTED to send a copy of this Opinion and Order to all parties. IT IS SO ORDERED. Isl Rebecca Beach Smith Chief Judge REBECCA BEACH SMITH CHIEF JUDGE July 31, 2017 28 Memorandum

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