By any standard, Manhattan trusts and estates lawyer Edward F. Campbell Jr. got a great deal on his house in ultra-exclusive Lloyd Harbor on Long Island's North Shore. For no down payment and a mere $1,000 a month, he was assigned the deed to a seven-bedroom house sitting on two wooded acres in a village where the median home sale price has been close to $2 million in recent years.
Too good to be true? Yes, said the Long Island judge who ruled earlier this month that Campbell, 57, had exercised undue influence and taken advantage of his superior legal knowledge to foist an unfair transaction on the sellers -- his own elderly parents....
The judge voided both the purchase agreement and the resulting deed, but he ordered the parties to maintain the status quo pending further hearings in Campbell v. Campbell, 23391/01. That status quo has been awkward, as the purchase agreement provided that Campbell's parents, Edward Sr. and Lucy, could continue to live in the house for the rest of their lives, cared for by their son and daughter-in-law, Carol. In their complaint, the elder Campbells claimed the arrangement had rendered them "virtual prisoners in their bedroom" who were "fed sandwiches for dinner" and denied air conditioning in the summer.
[The judge] noted that the younger Campbell had argued vigorously that this consideration should include "meals on the table" and assistance in the home, but the judge said it was "clear from the testimony that the value of this aspect of the claimed consideration has not proved significant to the plaintiffs." Bailey said a particularly "glaring example" of the unfairness of the agreement was that it gave the younger Campbell and his wife an unrestricted right to deduct any amounts they considered debts from their monthly payments to the elder Campbells. Edward Jr. paid off with interest an undocumented loan made to his parents by another son. To reimburse himself, Edward Jr. then deducted $600 from his monthly payment to his parents, paying them only $400 a month.
The judge noted that the parents did consult an outside lawyer about the proposed transfer in 1995 and that lawyer urged them to request changes to the deal. The requests caused Edward Jr. to pull out of the deal, only agreeing to revive it if his parents dropped their change requests and agreed that no outside lawyers be involved in the transaction.
Edward Jr., the oldest of nine children, also asked all of his living siblings to sign a release form agreeing not to sue over the agreement. The judge said it was significant that he did not also circulate a copy of the purchase agreement for his siblings to review.