## Facts

- Joyce Hensley and Graddy S. Duncan were formerly married and operated ranching ventures in Louisiana and later in Newton County, Arkansas.
- In June 1968, while contemplating divorce, the parties executed a property settlement giving Hensley the 440-acre Newton County farm and specified personal property (including livestock and equipment); Duncan executed a quitclaim deed to Hensley.
- In August 1968, Hensley obtained a divorce; the decree approved and incorporated the settlement.
- On February 4, 1969, Hensley executed and delivered to Duncan a quitclaim deed conveying the Newton County farm and a bill of sale covering cattle, horses, and farm machinery and tools; the instruments were recorded the same day.
- Hensley asserted Duncan forced the conveyances by threatening to kill her if she did not sign and that she acted out of fear of serious bodily harm or death; she also alleged lack of consideration.
- Hensley filed suit in chancery court in late May 1969 seeking cancellation of both instruments.
- The chancery court found Hensley executed the instruments under duress and cancelled them in their entirety.
- Duncan and his subsequent wife appealed, arguing evidentiary error (matters outside the pleadings), res judicata based on the divorce decree, insufficient proof of duress, and laches due to delay in filing.

## Issues

1. Whether the deed and bill of sale were voidable and subject to cancellation because they were executed under duress involving threats of serious bodily harm or death.
2. What burden and evidentiary standard applies to a request to cancel written instruments based on duress.
3. Whether the claim was barred by laches due to the time between execution of the instruments and filing suit.
4. Whether the action was barred by res judicata due to the earlier divorce decree and incorporated property settlement.
5. Whether admitting evidence over an objection that it exceeded the pleadings required reversal.

## Decision

- The Arkansas Supreme Court affirmed the decree cancelling the deed and bill of sale.
- The court held the chancellor’s finding of duress was not against the preponderance of the evidence, particularly where the outcome depended on credibility determinations.
- The court held cancellation based on duress requires proof by a preponderance of clear and convincing evidence, the same standard applied to cancellation for fraud.
- The court rejected laches because the suit was filed within months, Hensley asserted she remained under threats for part of that period, and Duncan showed no prejudice from the delay.
- The court held res judicata did not apply because the cancellation action concerned the validity of later-executed instruments, not issues decided in the divorce proceeding.
- The court held that when evidence is admitted over an objection that it is outside the pleadings, the pleadings are treated as amended to conform to the proof.

## Legal Principles

- A deed or bill of sale procured by threats placing the signer in fear of serious bodily harm or death is executed involuntarily and is voidable in equity.
- A party seeking cancellation of a written instrument for duress bears the burden to prove the claim by a preponderance of clear and convincing evidence.
- Laches requires both unreasonable delay and a showing that the delay caused prejudice or disadvantage to the party asserting the defense.
- Res judicata does not bar a later action when the later suit involves issues not adjudicated in the prior proceeding, even if the parties are the same.
- In equity practice, admitting evidence over a “beyond the pleadings” objection operates to treat the pleadings as amended to conform to the evidence.

## Conclusion

The court upheld equitable cancellation of post-divorce conveyances where the chancellor credited evidence that the instruments were signed under threats of death or serious harm, applied a clear-and-convincing proof requirement for duress-based cancellation, and rejected defenses of laches and res judicata as unsupported on the record.


Duncan v. Hensley, 248 Ark. 1083, 455 S.W.2d 113 (Ark. 1970)