There are some strict deadlines for contesting a will in Texas.
The will contest generally has to be filed within two years of the time the will is admitted to probate.
What happens if one of the parties hides the existence of the will and secretly probates the will? What if they make statements to dissuade anyone from looking into the matter?
These types of disputes involve the “discovery rule.” This rule is intended to allow parties additional time to bring will contests. The courts have not applied the rule as a grant of time, but rather a constraint or limit on time.
The Mooney v. Harlin, 622 S.W.2d 83 (Tex. 1981) case provides the factual background to consider this issue.
Facts & Procedural History
This case involved dispute between friends. They terminated their romantic relationship, but remained friends.
After doing so, one of the friends died. Prior to death, she had executed a will that did not provide for the surviving friend.
The family contested the will. The family reached a settlement agreement and the will was to be admitted to probate.
The will was admitted to probate in 1975 and the executor was appointed.
In 1978, the surviving friend brought suit to contest the will based on fraud. It is not clear what type of fraud was being alleged.
The trial court dismissed the will contest as it was beyond the two year statute of limitations.
Statute of Limitations for Fraud
Generally, a will contest has to be filed within two years of the will being admitted to probate. This general two year rule is found in Texas Estates Code § 256.204:
(a) After a will is admitted to probate, an interested person may commence a suit to contest the validity thereof not later than the second anniversary of the date the will was admitted to probate, except that an interested person may commence a suit to cancel a will for forgery or other fraud not later than the second anniversary of the date the forgery or fraud was discovered.
(b)Notwithstanding Subsection (a), an incapacitated person may commence the contest under that subsection on or before the second anniversary of the date the person’s disabilities are removed.
The language about a forgery or other fraud is referred to as the “discovery rule.”
The Discovery Rule
A reading of the “discovery rule” seems to suggest that it allows a will contest to be brought after the two year contest period has expired.
The discovery rule says that the two year time period starts to run once the forgery or fraud is discovered. This often leads to questions as to when the forgery or fraud was discovered.
The courts have developed a constructive notice rule. This rule says that the time period for the discovery rule starts when the forgery or fraud could have been discovered. When it applies, this constructive notice results in the court finding that there was actual notice. The finding is irrebuttable.
For probate cases, the courts have found that the time a forgery or fraud could have been discovered is the time when the will is admitted to probate. The thought seems to be that the forged or fraudulent will or application could be discovered by searching the probate records as of that date.
The Mooney case is an example of this. The case was dismissed as the friend was charged with constructive notice of the will filing. There are several court cases that reach the same conclusion as the court does in Mooney.
These court cases leave one wondering why the Texas legislature included the discovery rule in the Estates Code. Can the discovery rule ever apply in a probate case?
There are other court cases involving probate disputes that consider whether the statute of limitations is tolled due to fraud.
The Neill v. Yett, 746 S.W.2d 32 (Tex. App.–Austin 1988) court case is an example. In Neill, the court explains that only extrinsic fraud tolls the statute of limitations. Intrinsic fraud does not. According to the court:
- extrinsic fraud includes “fraudulent acts prevent a party from either having a trial or prevent him from having a fair opportunity to present his case” and
- intrinsic fraud is “when the fraudulent acts pertain to an issue that was, or could have been, litigated in the original suit.”
Intrinsic fraud includes claims such as whether the decedent had testamentary capacity to sign the will, there was undue influence, etc. These are the grounds for most will contests, which suggests that extrinsic fraud may not be sufficient.
In Valdez v. Hollenbeck, 465 S.W.3d 217 (Tex. 2015), the Texas Supreme Court described extrinsic fraud in terms of “fraudulent concealment.” The Court suggests that concealment by a fiduciary may be sufficient to toll the statute in probate cases if the other party acted with some diligence.
When evaluating the fraudulent concealment theory, other courts have explained that the tolling ends for fraudulent concealment when party learns of circumstances which would have a reasonably prudent person to make inquiry which would lead to discovery of concealed cause of action.
In Brown v. Arenson, 571 S.W.3d 324 (Tex. App. 2018) the court cites the discovery rule and Mooney (the case with the facts described at the top of this post) for the idea that constructive notice applies. Thus, even if there is a fiduciary duty, constructive notice may bar tolling for constructive fraud in probate cases.
This leaves one wondering whether, with the right facts, an extrinsic fraud or fraudulent concealment case could succeed in a probate dispute or is it also barred by the discovery rule.
Tortious Interference With Inheritance Rights
The case law also highlights other remedies that may be available notwithstanding the discovery rule. Tortious interference with inheritance rights may be one of them.
This cause of action the cause of action arises when one who by fraud, duress, or other tortious means intentionally prevents another from receiving from a third person an inheritance or gift that he would otherwise have received is subject to liability to the other for loss of the inheritance or gift.
In Haisler v. Coburn, No. 10-09-00275-CV (Tex. App.–2010), the court confirmed that the discovery rule does not apply to this type of claim. The court reasoned that this claim is not trying to set aside the will. Rather, it is an independent claim for damages against the third party.
Tex. Civ. Prac. & Rem. Code § 16.003 provides a two year statute for bringing tortious interference claims. These claims are subject to the general discovery rule developed by the courts outside of the Estates Code. It is not clear whether the constructive notice rules apply in this situation.
Also, there have been some appellate courts that have found that there is no cause of action for tortuous interference with an inheritance. The courts that hear appeals from probate disputes in Houston have found tortious interference as a viable cause of action. The Texas legislature or the Texas Supreme Court will eventually need to decide whether this cause of action is viable.
Even if it is not, the courts have made it clear that they will impose a constructive trust to right any wrongful property transfers. By finding a constructive trust, the courts are able to make sure that a bad actor is not able to succeed to property–whether they hid the transfer or not.