Background
JK, an elderly woman with progressive dementia, had two adult children: her son William Michael Kawa IV, who served as her caretaker for several years, and her daughter Heather Hayek. In 2024, Hayek successfully petitioned the Macomb County Probate Court to appoint her as JK’s conservator after she became concerned that Kawa was providing inadequate physical care and had misappropriated funds from JK’s bank accounts.
At the center of the dispute was a 2017 transfer of $87,406.53 from JK’s bank account into an account bearing both Kawa’s and JK’s names. Kawa maintained the money was a gift from JK — made voluntarily and while mentally competent — intended to compensate him after Hayek failed to repay a $100,000 loan JK had previously extended to her. Hayek disputed this account and petitioned the probate court to order Kawa to return all funds he had converted for his personal or business use.
The probate court held an evidentiary hearing at which it heard testimony from JK’s longtime friend, Hayek’s husband, Hayek, and Kawa. The court found the transfer was an act of conversion, expressly found Kawa’s testimony not credible and self-serving, and ordered him to repay the $87,406.53. Kawa appealed.
The Court’s Holding
The Court of Appeals affirmed on both grounds raised by Kawa. First, the court held that Kawa waived his statute-of-limitations defense under MCL 600.5805 by failing to raise it in his responsive pleading to Hayek’s petition, raising it instead for the first time at the evidentiary hearing. Under MCR 2.111(F)(2) and (3), failure to plead an affirmative defense in a first responsive pleading constitutes waiver. The court noted that the probate court had reached the correct result — rejecting the limitations defense — even though it had done so on different grounds (fraudulent concealment tolling), and affirmed on waiver grounds.
Second, the court found no clear error in the probate court’s conversion finding. Applying the common-law standard — that conversion is any distinct act of dominion wrongfully exerted over another’s personal property inconsistent with the owner’s rights — the court found ample record support. Hayek and JK’s longtime friend both testified that JK would not have secretly gifted money to one child without the other’s knowledge, and that major financial decisions were always discussed openly among the three. The deposit slip accompanying the transfer bore JK’s name but listed Kawa’s fiancée’s address, and Kawa ultimately admitted the handwriting on the slip appeared to be his own.
The court deferred to the probate court’s credibility determination that Kawa’s testimony was not believable, reiterating that appellate courts owe broad deference to probate court findings on witness credibility. It rejected Kawa’s argument that his unrebutted testimony that he was not a signatory on JK’s account compelled a finding in his favor, noting that fact-finders are not required to accept uncorroborated testimony they find incredible.
Key Takeaways
- Statute-of-limitations defenses are waived in Michigan probate proceedings if not raised in the first responsive pleading; raising the defense for the first time at an evidentiary hearing is too late.
- Probate court credibility determinations receive broad appellate deference, and uncorroborated testimony — even if technically unrebutted — need not be credited by a fact-finder that finds it incredible.
- A family member who controls an incapacitated person’s finances and transfers funds to his own account without corroborating evidence of consent or a gift may be liable for common-law conversion, even if the account nominally bears the incapacitated person’s name.
- An appellate court will affirm a probate court that reached the correct legal result even if it relied on different reasoning — here, waiver rather than tolling.
Why It Matters
This unpublished decision highlights the procedural and evidentiary risks facing family members who manage a vulnerable relative’s finances. The court’s strict enforcement of Michigan’s affirmative-defense pleading rules means that a respondent in probate proceedings cannot hold limitations arguments in reserve for trial — they must be raised at the outset or they are lost. Elder law practitioners and conservatorship respondents should take note that procrastination on affirmative defenses carries serious consequences.
More broadly, the case underscores the evidentiary burden on a person claiming a large cash transfer from a dementia patient was a gift. Absent contemporaneous documentation, corroborating witnesses, or other objective evidence, a fact-finder is free to disbelieve even unrebutted testimony — particularly when circumstantial evidence, such as the transferor’s handwriting on the deposit slip and the family’s documented practice of transparency around financial matters, points the other way.