Ricks v. Smith
| Decision Date | 05 November 1958 |
| Docket Number | No. A-6701,A-6701 |
| Citation | 318 S.W.2d 439,159 Tex. 280 |
| Parties | D. H. RICKS et ux., Petitioners, v. Ralph W. SMITH et al., Respondents. |
| Court | Texas Supreme Court |
Smith & Lehmann, Kelley & Ryan, Houston, for petitioners.
Strong, Baker & Compton, and John J. O'S. Heyburn, Houston, Wilson & Wilson, Wichita Falls, J. H. Schnell, Houston, for respondents.
A clear statement of this case may be found in the opinion of the Court of Civil Appeals, for which see 308 S.W.2d 941. The opinion is rather long, due no doubt to the fact that many independent questions were before the court for review. We have carefully considered all of the rulings of that court in the light of briefs filed here, and concur in each of those rulings. To place in the reports another opinion which would not vary materially from that of the Court of Civil Appeals could hardly be justified. Since, however, the case has been placed on our docket and argued orally before us, we shall write briefly on what we regard as the two principal questions presented.
The case calls for the construction of the holographic will of John Michael Dooley, which reads as follows:
'December 25th, 1952
'To whom it may concern:
'That I John Michael Dooley, do hereby make and publish this as my will and testament.
'I direct that my body be buried in a Christanlike manner in a Local cemetery.
'(signed)
'John Michael Dooley.'
During his lifetime testator purchased with community funds a number of Series E United States Savings Bonds payable to himself or his wife, Anna F. Dooley. He predeceased her without having cashed the bonds. After her death a controversy arose between her heirs, Ralph W. Smith et al., and the trustees and residuary legatees under testator's will, Ricks and wife, regarding the ownership of the bonds remaining uncashed at the time of her death, the former contending that they belonged to them as sole heirs of Mrs. Dooley, and the latter contending that they were community property of the Dooleys, one-half of which passed to them under his will. The trial court upheld this latter contention, but the Court of Civil Appeals reversed that judgment and held that upon the death of John M. Dooley his wife became vested with the sole ownership of the bonds. Accordingly, it was adjudged that no interest in the bonds passed to Mr. and Mrs. Ricks under Dooley's will. With this latter ruling we concur.
It cannot be questioned that the opinion of the Court of Civil Appeals follows the rule adopted by a majority of the courts. A number of cases from other jurisdictions are cited in the annotation in 37 A.L.R.2d 1216 et seq. The annotation is to the Louisiana case of Slater v. Culpepper, 222 La. 962, 64 So.2d 234, 37 A.L.R.2d 1216, which case declined to give controlling effect to the Treasury regulations incorporated in the bonds, holding that to do so would nullify community property law of that State. While that case is the only one cited from a State having community property law, we agree with the Court of Civil Appeals that the purchase of the bonds was by a contract which created a property right,-not merely a method of payment for the convenience of the Treasury Department. There is no sanctity of the community property law above that of other types of law. To give supremacy to Federal regulations no more affects community property law than laws of descent and distribution. The solution as to the property rights of the surviving co-owner of 'or' bonds rests in contract and that contract becomes a part of the bonds. The decisions in this jurisdiction cited in the opinion of the Court of Civil Appeals, while not deciding the precise question here presented, are certainly in harmony with the majority rule followed by that court. We, therefore, approve that holding.
Some time after the death of John M. Dooley his surviving wife, Mrs. Anna F. Dooley, became insane, and D. H. Ricks was appointed guardian of her estate. Under orders of the probate court he spent about $13,000.000 for her care and maintenance. It is the contention of the heirs of Mrs. Dooley that the trustees under the will of John M. Dooley were not vested with any discretion to determine when and in what amount resort should be made to his estate for the maintenance and support of his widow, but were compelled to exhaust all the trust estate, if necessary, before resorting to any of the property of Mrs. Dooley which was in possession of D. H. Ricks in his capacity as guardian of her estate. Neither of the courts below upheld that contention. We would regard this question as a very serious one had we concluded that a one-half interest in the bonds belonged to Dooley's estate and passed by the will to the trustees, who were made residuary legatees under the will. But, since we have held that his estate had no interest in those bonds, the only property passing to the residuary legatees under the will was a one-half interest in the Dooley homestead. Without determining what degree of discretion, if any, was vested in the trustees by the will, we agree with the Court of Civil Appeals that there was no breach of trust in the failure to sell the testator's one-half interest in the homestead in order to apply the proceeds thereof to the support and maintenance of Mrs. Dooley.
Finding no error in the judgment of the Court of Civil Appeals, that judgment is affirmed.
If this were the only situation that could arise involving ownership of 'or' bonds purchased with community funds, there would be little reason for disagreeing with the majority holding on that question. It is my view, however, that we are now drifting into a position that will either prove untenable or will lead to inconsistent or undesirable results. This case probably represents the point of no return, and I would hold that upon the death of the husband, the wife as surviving co-owner was under a duty to account to his estate for one-half of the value of the bonds at the time of his death.
It should be observed at the outset that the Texas decisions bearing on the question are not necessarily controlling here. In Edds v. Mitchell, 143 Tex. 307, 184 S.W.2d 823, 158 A.L.R. 470, we were concerned with 'p.o.d.' bonds purchased by a life tenant with power of disposition. Community funds evidently were not involved in either McFarland v. Phillips, Tex.Civ.App., 253 S.W.2d 953 (), or Chamberlain v. Robinson, Tex.Civ.App., 305 S.W.2d 817, (wr. ref.) and our courts have never considered the federal regulations in the light of our laws dealing with community property and the power of the marital partners to contract with respect thereto.
At first glance, these decisions seem to point to the conclusion reached by the majority in the present case, because a uniform rule governing ownership of 'or' bonds after the death of one of the co-owners is undoubtedly desirable. The difficulty is that the holding in this case cannot lead to uniform results unless we are willing to close our eyes to some of the principles that are rather deeply imbedded in the community property laws of this State. It is said by the majority that the solution as to the property rights of the surviving co-owner rests in contract. If this be true, then the Texas law is an important consideration in determining whether ownership of the bonds is effectively vested by contract in the surviving co-owner.
Since there is nothing in our law to prevent a husband from making a contract affecting community...
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