87 N.J. 163, 432 A.2d 890 (1981)
Mrs. Isabel Dutrow, the testatrix, died on September 27, 1977.1 Her last will, dated April 8, 1976, was admitted to probate by the Surrogate of Ocean County on October 12, 1977, with the First National State Bank of New Jersey serving as executor.2 The plaintiffs, two of Mrs. Dutrow's six grandchildren and the sons of her deceased daughter Betty Haynes, brought suit to set aside the probate of the will and two related trust agreements.3 The principal beneficiary under the contested instruments was Mrs. Dutrow's surviving daughter, Dorcas Cotsworth.4
After the death of her daughter Betty in June 1973, Mrs. Dutrow moved from York, Pennsylvania, to live with Dorcas and John Cotsworth in Short Hills and Bay Head, New Jersey.5 For more than thirty years prior to Betty's death, Betty and her sons had lived with Mrs. Dutrow in the family home.6 Although Mrs. Dutrow was eighty-four years old at the time of the move and suffered from glaucoma, cataracts, diverticulitis, and a recent hip fracture, she remained alert and intelligent.7 Earlier estate plans prepared by longtime family attorney Richard Stevens had provided for equal treatment between the Haynes and Cotsworth branches of the family.8
Beginning in July 1973, Mrs. Dutrow executed multiple new wills and trust agreements that progressively favored Dorcas Cotsworth and her children.9 Dorcas and John Cotsworth consulted their attorney Grant Buttermore, who had represented the Cotsworth family and their business for several years.10 Buttermore met privately with Mrs. Dutrow, discussed her assets and plans, and prepared new trust agreements and a will executed on January 16, 1974, which severed the Haynes grandchildren from most of the estate.11 On April 24, 1975, Mrs. Dutrow amended the revocable trust agreement and added a codicil to her will to include in terrorem clauses in each instrument.12 The necessary amendments to the revocable trust agreement were prepared by Buttermore and executed by Mrs. Dutrow on January 9, 1976, providing for distribution of the principal to Dorcas upon Mrs. Dutrow's death, or, if Dorcas was not then living, equally among Mrs. Dutrow's grandchildren.13
The plaintiffs challenged the instruments after probate.14 In an unreported opinion, the trial court upheld the probate, finding that a presumption of undue influence had been rebutted, but ruled the in terrorem clauses unenforceable.15 The Appellate Division affirmed the upholding of the will and trusts but reversed on the enforceability of the in terrorem clauses.16 The Supreme Court granted the plaintiffs' petition for certification.17
Whether the contested will and two related trust agreements are invalid on the grounds of undue influence because the attorney who advised the testatrix and prepared the testamentary instruments was also the attorney for the principal beneficiary?18
A presumption of undue influence arises when there is a confidential relationship between the testatrix and a beneficiary and suspicious circumstances are present.19 When the attorney preparing the will has a conflict of interest by also representing the principal beneficiary, the presumption must be rebutted by clear and convincing evidence rather than a mere preponderance of the evidence.20
No. The trial court correctly identified the confidential relationship between Mrs. Dutrow and Dorcas Cotsworth as well as the suspicious circumstances arising from Buttermore's dual representation.21 The court nevertheless applied the incorrect burden of proof by requiring only a preponderance of the evidence instead of clear and convincing evidence to rebut the presumption.22 The matter must therefore be remanded for new findings under the proper standard.23
The matter is remanded to the trial court for new findings of fact and legal conclusions based upon application of the clear and convincing evidence standard.24
Whether a non-contestability or in terrorem clause in the testamentary documents is enforceable under New Jersey common law when the decedent died before the effective date of N.J.S.A. 3A:2A-32?25
Under New Jersey common law, in terrorem clauses are generally enforceable even when a contest is brought in good faith and with probable cause if the challenge is based on undue influence.26 However, the policy expressed in N.J.S.A. 3A:2A-32, though not applicable by its terms, supports declining to enforce such clauses where probable cause exists for the challenge.27
No. The trial court concluded that the plaintiffs proceeded in good faith and on probable cause.28 That finding is amply supported by evidence of record concerning the complex changes in the estate plan and the involvement of the Cotsworths' attorney.29 Although the statute was not effective at the time of Mrs. Dutrow's death, the court applies the legislative policy to render the clauses unenforceable in both the will and the trust agreements.30
The in terrorem clauses in the will and trust instruments are not enforceable.31
Related opinions on this issue
Justice Clifford agrees with the majority's treatment of the undue influence issue but dissents on the enforceability of the in terrorem clauses.32 He maintains that enforcement was in keeping with the public policy of the state at the time the clauses were added in 1975 and at the time of Mrs. Dutrow's death in 1977.33 Clifford argues that the majority improperly relies on a statute not yet effective and that testators should be permitted to include such clauses to discourage litigation and family discord without judicial second-guessing of their intentions.34