What happens if someone makes a promise to leave property to another person in their will, but then they update their estate plan and their promise is not fulfilled?
What if the promise was not reduced to writing? Can the person recover property from the probate estate based on a verbal promise?
These questions are at the heart of the probate litigation case of Estate of Gilbert, 513 S.W.3d 767 (Tex. 2017), which was decided by the Texas Supreme Court.
Facts & Procedural History
This probate litigation involves a long-term girlfriend who transferred property to the boyfriend based on his verbal promise to execute a will naming her as the sole beneficiary.
In the late 1990’s the girlfriend, Trudy, sold her boyfriend, Jack, her house in exchange for Jack’s promise to execute a will naming her as the sole beneficiary of his estate. The boyfriend executed a will listing the girlfriend as the sole beneficiary in 2004.
In 2008, Trudy executed a gift deed transferring an unimproved half-acre lot to Jack also in reliance on his promise to name her as his sole beneficiary. In 2015, the couple split up and Jack revised his will, naming his son, James, as his sole beneficiary and independent executor of his estate. Jack died about four months later.
Probate Process Begins
The son probated the will. Trudy sued Jack’s estate asserting claims for breach of contract and promissory estoppel. Trudy requested injunctive relief and a constructive trust on all of the estate’s property, including the two tracts of real property Trudy previously conveyed to Jack. The trial court granted a temporary restraining order in Trudy’s favor.
During the hearing for the temporary injunction, Trudy based her request solely on her claim of promissory estoppel. However, the trial court ruled that Trudy did not have a legally valid cause of action and dissolved the temporary restraining order while also denying her application for a temporary injunction. As a result, Trudy has filed an appeal.
Here, the trial court assumed Trudy could prove all of the elements of her promissory estoppel claim, but it denied Trudy’s application for a temporary injunction because it concluded section 254.004 bars such a claim as a matter of law.
Trudy argues that the trial court made a mistake by determining that her promissory estoppel claim against Jack’s estate was not valid. James argues that Trudy failed to provide evidence to support her claim. However, Trudy points out in her reply brief that the court’s ruling was not based on evidence. Rather, during the hearing, the court explicitly stated that its decision depended on whether the law permitted Trudy to make a promissory estoppel claim against Jack’s estate.
Therefore, the dispositive question in this appeal is whether Trudy can assert a promissory estoppel claim against Jack’s estate based on his oral promise to name her as his sole beneficiary in his will.
Writing Required for Breach of Contract Claims
Texas Estates Code § 254.004(a) provides that a contract to make a will can only be proven by a written document or a will stating that the contract exists and what the terms are. This law bars claimants from inheriting property based on verbal promises made by the decedent during lifetime.
In recognition of this provision, Trudy dropped her breach of contract claim; however, Trudy contends section 254.004(a) does not affect her ability to assert a promissory estoppel claim. However, Trudy didn’t cite any authority to show that promissory estoppel is a viable cause of action in her circumstances.
Requirements of Promissory Estoppel
Promissory estoppel requires the claimant to prove that there was:
- a promise,
- the promisor foresaw that the claimant would rely on it, and
- the claimant relied on the promise to her detriment.
These elements seem to have been met in this case. The boyfriend made a promise, he knew she would rely on the promise, and she did, as she transferred her property to the boyfriend.
This leaves the question whether promissory estoppel is a valid claim, when the promise is not in writing?
The court also explained the similar case of Estate of Wallace, No. 04–05–00567–CV (Tex. App.–San Antonio 2006) in their opinion.
Facts & Procedural History
This case involves two cousins, William Riddick and Willard Wallace. Wallace owned 500 acres of land, and Riddick alleged Wallace, promised to sell him the property in the future, in exchange for services the aggrieved party provided. Wallace contracted to sell 400 acres to a third party; however, the sale never closed, and Riddick subsequently threatened to sue Wallace for breaching his promise. To avoid the lawsuit, Wallace and his wife agreed to give Riddick an undivided one-half interest in 100 acres instead of selling him the entire 500 acres, as previously agreed.
In 1993, Wallace and his wife showed Riddick copies of their wills, which included the devise. After Wallace’s death in 2001, his wife filed an application to probate his will. The will offered for probate, however, was a 1996 will that excluded Riddick from receiving any interest in the 100 acres. Riddick sued the estate asserting various claims, and the trial court granted a series of summary judgments on different claims.
On appeal, Riddick challenged the summary judgment dismissing his unjust enrichment claim. Similar to Trudy’s stance in this appeal, Riddick conceded that section 59A(a) of the Texas Probate Code barred him from maintaining a breach of contract claim. However, Riddick argued the trial court erred in granting the estate’s motion for summary judgment wherein the estate contended that Riddick’s claim for unjust enrichment was barred as a matter of law because § 59A bars the enforcement of an oral agreement to make a will.
Unjust enrichment allows the party to be put back into the position he would have been before dealing with the decedent. In this situation, that would equate to payment for his services but that isn’t what he asked the court for. Instead, he asked for the property he was promised. This remedy is more in line with expectancy damages which allow a plaintiff to receive the benefit of the bargain by placing him in as good a position as he would have been had the contract been performed.
The court noted that unjust enrichment does not allow for expectancy damages, which are only available pursuant to a contract. Thus, the court in Wallace concluded that the claim for unjust enrichment fails given what the aggrieved party asked for in that case.
The Court’s Decision in the Temporary Injunction Appeal
Trudy contends the decision in Estate of Wallace does not preclude her promissory estoppel claim because she has limited the relief she is requesting and only seeks to be placed in the position she was in, prior to her dealings with Jack, by recovering the real property she conveyed to him.
The court explained that Congress intended 254.004 to foreclose a claim relating to a promise to make a will if that promise is not in writing. Accordingly, the court held section 254.004 bars a claim for promissory estoppel on an oral promise to devise property that is disposed of in a will. Therefore, because Trudy seeks to enforce Jack’s alleged oral promise to devise his estate to her, and Jack’s will devises his estate to another, Trudy’s claim is barred.
To obtain a temporary injunction, Trudy was required to prove she had a cause of action against the estate, but because Trudy’s promissory estoppel claim is barred by Estates Code section 254.004(a), Trudy no longer had a cause of action against the estate. Therefore, the court concluded the trial court did not abuse its discretion in denying Trudy’s application for a temporary injunction.
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