This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
A transaction between parent and child, resulting in a benefit to the parent, creates a presumption of undue influence.1 The Supreme Court of the United States has held, contrary to the weight of authority, that no presumption of undue influence arises in such cases,2 though circumstances showing compulsion as a fact may establish undue influence.3
No presumption of undue influence arises in case of a gift by the parent to the child, or other transaction resulting in a benefit to the child,4 even if they are living together,5 and even if such instrument is drawn by a lawyer who is not the one usually selected by the father;6 or even if such instrument is witnessed, while another instrument executed at the same time is not witnessed.7 The fact that a parent conveys all his property to his children is not sufficient to establish undue influence if he was earning more than enough to support him when he made such conveyance.8 Undue influence is not shown where the parent reserved enough for support.9 A conveyance by a parent to a child is not presumed to be made by undue influence, even if it results in an unfair distribution of the property of the parent among his children;10 and still less is it to be presumed that undue influence existed if the property conveyed to one of grantor's children is no more than fair compensation for services and support furnished by such child.11 The fact that such transaction is not supported by an adequate consideration,12 or that it is not shown that the parent acted on independent advice,13 does not render the transaction invalid. There is even a negative presumption in cases of gifts from parent to child, and undue influence has been held not to exist where, owing to the feeble condition of the parent, undue influence would be held to exist had the transaction existed between persons not so related.14 In some jurisdictions, however, it has been said that if the parent is aged and infirm and reposes actual trust and confidence in the child, the burden is upon the child to show that such transaction was fair and free from undue influence.15
7Pritchard v. Hutton, 187 Mich. 346, 153 N. W. 706; Fjone v. Fjone, 16 N. D. 100, 112 N. W. 70.
8Cox v. Schnerr, 172 Cal. 371, 156 Pac. 509; see Sec. 407 et seq.
1Illinois. Oliphant v. Liversidge, 142 111. 160, 30 N. E. 334.
Mississippi. Plant v. Plant, 76 Miss. 560, 25 So. 151.
Pennsylvania. Worrell's Appeal, 110 Pa. St. 349, 1 Atl. 380, 765.
Texas. Saufley v. Jackson, 16 Tex. 579; Millican v. Millican, 24 Tex. 426.
Virginia. Todd v. Sykes, 97 Va. 143, 33 S. E. 517.
Washington. Muzzy v. Tompkinson, 2 Wash. 616, 27 Pac. 456, 28 Pac. 652.
2 Jenkins v. Pye, 37 U. S. (12 Pet.) 241, 9 L. ed. 1070.
3 Taylor v. Taylor, 49 U. S. (8 How.) 183, 12 L. ed. 1040.
4 United Stares. Mackall v. Mackall, 135 U. S. 167, 34 L. ed. 84; Towson v. Moore, 173 U. S. 17, 43 L. ed. 597.
Alabama. McLeod v. McLeod, 145 Ala. 269, 117 Am. St. Rep. 41, 40 So. 414; Hawthorne v. Jenkins, 182 Ala. 256, 62 So. 505; Hassell v. Hassell, - Ala. - , 77 So. 716.
Illinois. Kennedy v. Kennedy, 194 III. 346, 62 N. E. 797; Preston v. Lloyd, 269 111. 152, 109 N. E. 687.
Indiana. Slayback v. Witt, 151 Ind. 376, 50 N. E. 389.
Iowa. Mallow v. Walker, 115 la. 238, 91 Am. St. Rep. 158, 88 N. W. 452.
Louisiana. Reinerth v. Rhody, 52 La. Ann. 2029, 28 So. 277.
Massachusetts. Parsons v. Parsons, 230 Mass. 544, 119 N. E. 1020.
Michigan. Ladu v. Ladu, 84 Mich. 469, 47 N. W. 1101.
Missouri. Carter v. Dilley, 167 Mo. 564, 67 S. W. 232; Fitzpatrick v. Weber, 168 Mo. 562, 68 S. W. 913.
New Jersey. Soper v. Cisco, 85 N. J. Eq. 165, 95 Atl. 1016.
Oregon. Sappingfield v. Sapping-field, 67 Or. 156, 135 Pac. 333; Rowe v. Freeman, 89 Or. 428, 172 Pac. 508.
Pennsylvania. Crothers v. Crothers, 149 Pa. St. 201, 24 Atl. 190; Simon v. Simon, 163 Pa. St. 292, 29 Atl. 657; Hummel v. Kistner, 182 Pa. St. 216, 37 Atl. 815; Carney v. Carney, 196 Pa. St. 34, 46 Atl. 264.
South Carolina. Huggins v. Hug-gins, 107 S. Car. 470, 93 S. E. 129.
Wisconsin. Marking v. Marking, 106 Wis. 292, 82 N. W. 133.
5Hawthorne v. Jenkins, 182 Ala. 255, 62 So. 505.