IN RE ESTATE OF LINDA A. FARMER
Session August 19, 2014
Appeal from the Circuit Court for Davidson County No. 11P1469 David Randall Kennedy, Judge
John A. Beam, III, Andrew Christian Cameron, and Desiree J. C. Goff, Nashville, Tennessee, for the appellants, Doris Fay Parris and the Estate of Linda A. Farmer.
J. Ross Pepper and Mitchell Paul Ronningen, Nashville, Tennessee, for the appellee, Randy L. Farmer.
Frank G. Clement, Jr., P.J., M.S., delivered the opinion of the Court, in which Richard H. Dinkins and W. Neal McBrayer, JJ., joined.
FRANK G. CLEMENT, JR., JUDGE
This action was brought by the Estate of Linda A. Farmer and on behalf of the decedent's sister, Doris Fay Parris, against their brother Randy L. Farmer, who is alleged to have unduly influenced Linda Farmer in executing amendments to her revocable living trust, pursuant to which he was named the trustee and the sole residuary beneficiary; he is also alleged to have unduly influenced his sister Linda Farmer to execute a power of attorney naming him as her attorney-in-fact. Further, it is alleged that Randy Farmer breached his fiduciary duties as the trustee by converting trust assets and, as Linda's attorney-in-fact, by converting assets from Linda's bank accounts. The relevant facts leading up to this action are stated below.
Linda A. Farmer ("the decedent") lived with her mother, Marie Farmer, her entire life in Nashville, Tennessee. This was due in part to the fact that the decedent was born with Turner's syndrome, a condition that affected her physical development and impeded her ability to interact in social situations. The condition, however, did not prevent the decedent from maintaining gainful employment for much of her adult life as she worked for many years as a data entry clerk for the State of Tennessee. Because her mother provided all essentials, including room and board as well as transportation to and from work everyday, the decedent was able to save her earnings; by the time of her death, the decedent had almost a million dollars in assets, much of which she had placed in a revocable living trust that was created in 2004.
The decedent died on September 13, 2011, at the age of 64. She was survived by her mother, who died a few weeks later, and by two siblings, her brother Randy Farmer, who is the defendant in this action, and her sister Doris Parris, who is the individual plaintiff along with the estate. She was also survived by several nieces and nephews.
When the decedent created her revocable living trust in 2004, she placed substantial assets in the trust; specifically, a U.S. Bank account and a brokerage account at Cambridge Way Brokerage Securities. Pursuant to the 2004 trust agreement, she appointed herself as the sole trustee, and she named her brother, Randy Farmer, and two of her nieces, Vicky Gamble and Cheryl Pitt, as successor co-trustees. Upon the decedent's death, the trust assets were to be distributed as follows: her brother Randy Farmer was to receive 25%; her sister Doris Parris was to receive 25%; and the remaining 50% was to be distributed equally among Mrs. Parris' children. The decedent also contemporaneously executed a power of attorney in 2004 by which she appointed her niece Vicky Gamble, one of Mrs. Parris' children, as her attorney-in-fact.
In the fall of 2006, the husband of Mrs. Parris died. As a result, Randy Farmer, who had been living in Florida with his wife, Nancy Farmer, for many years, returned to Tennessee for the funeral. They remained for approximately a month, during which time they stayed with the decedent and her mother. It was during this month-long stay when Mr. Farmer prepared an amendment to the 2006 trust, a new power of attorney, and a new will, each of which the decedent executed. Pursuant to the 2006 trust amendment, Mr. Farmer was appointed the sole successor trustee. The 2006 amendment also directed that upon the decedent's death, her sister Mrs. Parris and her niece Vicky Gamble were each to receive a $5, 000 cash distribution; the other nieces and nephews were to receive $1, 000 each, and all remaining trust assets were to be distributed to Mr. Farmer as the sole residuary beneficiary of the trust. The 2006 amendment further specified that "I'm only leaving $5, 000 to my sister Doris Parris, because she's been so well taken care of by her husband." The new power of attorney designated Mr. Farmer as the decedent's attorney-in-fact. In the 2006 will, Mr. Farmer was appointed the executor of the decedent's estate, and the will directed that, at her death, any assets of her estate shall be poured over into the trust.
Mr. Farmer then returned to Florida where he and his wife remained until the fall of 2007 when he again visited his mother's home. During this visit, Mr. Farmer determined that his mother and the decedent were in need of assistance, and they could not continue living alone without full-time assistance. Particularly, his mother's eyesight had worsened which prevented her from driving the decedent to and from work. In addition, the decedent was now experiencing severe back pain that prevented her from working; instead, she was drawing upon her accrued sick pay. Believing his mother and the decedent needed full-time care and attention, and because no other family member was willing or able to help, Mr. Farmer and his wife moved into the basement of his mother's home to provide full-time assistance.
The decedent and her mother paid for Mr. Farmer's moving expenses and to remodel the basement of the home so that he and his wife Nancy could live there. After the move, Mr. Farmer and his wife, a registered nurse, would take the decedent and her mother to their doctor's appointments, manage their medicine, prepare meals, and attend to their daily needs. Nancy made an appointment for the decedent to be examined by a neurologist to address her increased back pain, after which the decedent's back pain subsided substantially. Not long after Mr. Farmer and his wife moved into his mother's home, the decedent elected to retire. Thereafter, they continued to reside in his mother's home while the decedent and her mother supported them.
By 2008, Mr. Farmer began revising the decedent's financial holdings, including those in her trust. He consolidated most of the decedent's assets by closing her Cambridge Way brokerage account and transferring those assets into several E*Trade accounts in the name of the trust; specifically, he transferred the cash accounts to an E*Trade investment account and an E*Trade banking account in the name of the trust. He also rolled over her Cambridge Way IRA into an E*Trade IRA.
After establishing the E*Trade accounts for the decedent and her trust, Mr. Farmer began day-trading and managing those investments. He also possessed the debit card associated with the decedent's E*Trade bank account, which he used to pay for his and his wife's personal expenses. Mr. Farmer also made a series of broker-to-broker transfers from her E*Trade investment account into either his personal E*Trade account or an E*Trade account he had created for his daughter. Over a period of time, Mr. Farmer transferred $167, 000 out of the decedent's account into his or his daughter's accounts. Despite these substantial transfers, the decedent always had more than sufficient funds needed for her welfare and support.
In November 2009, the decedent executed another amendment to her trust, a power of attorney, and will. These documents were executed with the assistance of counsel in the decedent's home in the presence of her mother, her sister Mrs. Parris, and her niece Vicky Gamble. Mr. Farmer and his wife were neither present nor aware of the execution of these documents. In the 2009 trust amendment, the decedent appointed herself as the trustee and her niece Ms. Gamble as the successor trustee, and restated the terms of her 2004 trust agreement, whereby upon the decedent's death, her sister and brother, Mrs. Parris and Mr. Farmer, each received a 25 percent share of the trust, and her nieces and nephews shared the remaining 50 percent of the trust. Ms. Gamble was designated as the decedent's attorney-in-fact and as the executor of her estate. The will distributed the residue of her estate into her trust.
A few months later, in February 2010, the decedent met privately with attorney Allison Thompson on two occasions prior to executing a third amendment to the decedent's revocable trust; the amendment was signed in the attorney's office. The 2010 amendment, which was the final amendment to the trust, revoked the 2009 amendment and republished the 2004 trust agreement subject to several amendments. Specifically, the decedent resigned as trustee and appointed her brother Mr. Farmer as the sole trustee; she also reinstated several small cash bequests to family members, including a $5, 000 cash bequest to her sister Mrs.Parris, and designated her brother Mr. Farmer as the sole residuary beneficiary of her trust.Additionally, she executed a new power of attorney that appointed Mr. Farmer as her attorney-in-fact.
In the spring and summer of 2011, the decedent's health and that of her mother declined, during which time the decedent was in and out of the hospital repeatedly while her mother was receiving hospice care at home. The decedent passed away on September 13, 2011, at the age of 64. Her mother died two weeks later on September 25, 2011. Within days following the decedent 's death, her will dated November 2009 was admitted to probate and letters testamentary were issued to her niece Vicky Gamble.
Contemporaneous with the opening of the decedent's probate estate, on September 30, 2011, Ms. Gamble and her brother Paul Parris, III, commenced this action in the name of their mother, Doris Fay Parris,  against Randy Farmer, individually, and as attorney-in-fact and as trustee for the decedent. The complaint alleged that Mr. Farmer committed the tort of conversion in his dealings with the decedent's bank accounts prior to her death, that he breached his fiduciary duty as the decedent's attorney-in-fact and trustee in dealing with her property, and that he unduly influenced the decedent in procuring amendments to her trust. The complaint clearly states that it was filed on behalf of Doris Fay Parris and the estate was not identified as a plaintiff; however, in subsequent proceedings, the trial court ruled that the Estate of Linda Farmer was also a plaintiff. Thus, the action proceeded with the Estate of Linda Farmer recognized as a plaintiff along with Mrs.Parris.
A jury trial was held from July 15-18, 2013. Several witnesses testified, including Vicky Gamble, her son John Gamble, and Carl Davis, who testified as an expert witness for the plaintiffs. Testifying for the defense were Randy Farmer, his wife Nancy Farmer, and attorney Allison Thompson. Thirty-five exhibits were introduced into the record, including the 2004 trust document, the 2006 trust amendment, the 2009 trust amendment, and the 2010 trust amendment; the 2004 power of attorney, the 2006 power of attorney, the 2009 power of attorney, and the 2010 power of attorney; the 2006 will and the 2009 will; and monthly statements from the E*Trade accounts from 2007-2011.
Ms. Gamble testified that she and her mother, Mrs. Parris, shared a close relationship with the decedent and her mother throughout their lives. Ms. Gamble and Mrs. Parris lived nearby, and would frequently visit the decedent and her mother. Ms. Gamble testified that the decedent 's mother was very protective of the decedent, and she always wanted the decedent to live with her in her home. Ms. Gamble explained that the decedent was a special needs child due to Turner's syndrome and that she needed guidance paying bills and taking her medication. She further testified that the decedent was easily manipulated and unable to stand up to Randy Farmer's domineering demeanor. Ms. Gamble stated that, while the decedent could bathe and dress ...