Estate of Cleveland v. Gorden
1992 Tenn. App. LEXIS 439, 837 S.W.2d 68 (1992)
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Rule of Law:
The presumption that financial support provided between family members is a gratuitous gift can be rebutted by circumstances showing the recipient knew or should have known the provider expected reimbursement, even without an express agreement.
Facts:
- Frances Cleveland, an elderly woman, lived alone in Nashville and supported herself on a modest income.
- In January 1984, at age 92, Cleveland became seriously ill.
- Her niece, Jane C. Gorden, traveled from Houston to care for her, as Cleveland had no one else.
- Recognizing her aunt needed skilled care, Gorden placed Cleveland in a nursing home in February 1984.
- Bank officers advised Gorden she could be reimbursed for Cleveland's expenses if she opened a separate account and kept detailed records.
- From 1984 until 1989, Gorden used her own funds to pay for Cleveland's nursing home bills, medical expenses, and other costs.
- Cleveland was aware that Gorden was paying her bills and stated to a companion that Gorden "would get everything she had, if there was anything left."
- Frances Cleveland died on March 15, 1989.
Procedural Posture:
- Jane C. Gorden filed a claim for $99,741 against the estate of her deceased aunt, Frances Cleveland, in the Davidson County Probate Court.
- The administrator of the estate opposed the claim, arguing the expenditures were gifts.
- The probate court (trial court) denied Gorden's claim, finding no evidence of an agreement for reimbursement.
- Gorden, as the appellant, appealed the probate court's decision to the Court of Appeals of Tennessee.
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Issue:
Does a niece who pays for her elderly aunt's medical and living expenses out of a sense of moral obligation have a right to reimbursement from the aunt's estate, despite the absence of an express repayment agreement, if circumstances indicate the aunt knew her niece expected to be repaid?
Opinions:
Majority - Koch, J.
Yes. A niece who pays for her aunt's expenses under a moral obligation is entitled to reimbursement where circumstances demonstrate the aunt knew or should have known reimbursement was expected. The general rule that a volunteer who pays another's debt is not entitled to reimbursement does not apply to a person acting under a moral obligation, such as a family member caring for another. While services between family members are presumed to be gratuitous, this presumption is rebuttable. Here, the presumption was overcome because Gorden and Cleveland were not close relatives who lived together, Cleveland was unable to reciprocate the care, and the circumstances indicated an expectation of repayment. Gorden's meticulous record-keeping, as advised by the bank, and Cleveland's statement that Gorden would get everything she had, demonstrated that the payments were not intended as a gift and that Cleveland understood Gorden expected to be compensated from her estate.
Analysis:
This decision clarifies the application of the 'presumption of gratuitousness' in family law and estate claims. It establishes that the presumption is significantly weaker when relatives do not live together in a shared household. The case provides a framework for recovering expenses based on an implied-in-fact contract, where the parties' conduct, rather than an express promise, demonstrates an intent for repayment. This precedent is significant for future cases involving family members who provide substantial financial support during a relative's final illness, allowing for reimbursement where fairness and the parties' apparent understanding warrant it.
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