Ambruster v. Ambruster
| Citation | 31 S.W.2d 28 |
| Decision Date | 04 September 1930 |
| Docket Number | No. 29912.,29912. |
| Parties | ROBERT J. AMBRUSTER, Appellant, v. EDITH E. AMBRUSTER and WILLIAM AMBRUSTER UNDERTAKING COMPANY. |
| Court | United States State Supreme Court of Missouri |
Appeal from Circuit Court of City of St. Louis. — Hon. Frank Landwehr, Judge.
REVERSED AND REMANDED (with directions).
Mark D. Eagleton and Hensley, Allen & Marsalek for appellants.
(1) An administrator cannot lawfully buy property of the estate at his own sale; and if he does so, he will be required by a court of equity to account for the property as a trustee. Gilmore v. Thomas, 252 Mo. 147; Stoff v. Schuetze, 293 Mo. 635; Bopst v. Williams, 287 Mo. 317, 334; Hull v. Voorhis, 45 Mo. 555; State ex rel. v. Amer. Surety Co., 191 Mo. App. 191; Davoue v. Fanning, 2 Johns. Ch. R. 252; Scott v. Gamble, 9 N.J. Eq. 218; Otis v. Kennedy, 107 Mich. 312; Harrod v. Harrod, 167 Ky. 308; Ebelmesser v. Ebelmesser, 99 Ill. 541; 24 C.J. 633-635, sec. 1590; 18 Cyc. 769, 770. (2) Where an administrator purchases property of the estate with funds or credits of the estate in his hands, he holds such property in trust for the heirs or distributees of the estate, in whose favor a resulting trust arises. Stoff v. Schnetze, 293 Mo. 635, 652; Hynds v. Hynds, 274 Mo. 123, 134; Harney v. Donohoe, 97 Mo. 141; Patterson v. Booth, 103 Mo. 402. (3) Where an administrator retains property in his hands rightfully belonging to the heirs or distributees, no distribution thereof ever having been made by him, he remains a trustee with respect to such property and is liable to account therefor as such. Stoff v. Schuetze, 293 Mo. 635, 656; Hynds v. Hynds, 274 Mo. 123; Moulden v. Train, 199 Mo. App. 511. (4) Since the fifteen shares of stock of the corporation standing in the name of William Ambruster were inventoried by the defendant Edith E. Ambruster, administratrix, as assets of the estate of William Ambruster, deceased, and were dealt with by her, as such administratrix, throughout the process of administration, as being assets of said estate, she is forever estopped to claim any title thereto or right therein other than as a distributee of said estate. In re Estate of Cogswell & Co., 93 Mo. App. 482, 490; Bombeck v. Bombeck, 18 Mo. App. 26; Estate of Glover & Shepley, 127 Mo. 153; Potter v. Adam's Executors, 24 Mo. 159; Coleman v. Farrar, 112 Mo. 54; Mississippi County v. Jackson, 51 Mo. 23; Prince v. Towns, 33 Fed. 161; 23 C.J. 1158, sec. 372, footnote 62; 39 Cyc. 226; 10 R.C.L. 821, sec. 127; 10 R.C.L. 107, sec. 109 (5) The articles of association of the corporation constituted a solemn written agreement between the parties signing the same as to their respective stock holdings. And, in the absence of fraud or mutual mistake, the terms of that contract could not be varied by parol. Scullin Steel Co. v. Iron Co., 308 Mo. 453; Beheret v. Myers, 240 Mo. 58; Willoughby v. Brandes. 297 S.W. 54; Bank of Dearborn v. Gabbert, 291 S.W. 142; J.B. Colt Co. v. Farmer, 286 S.W. 399. (6) It is not material whether any stock certificate for the fifteen shares in question was ever issued to William Ambruster during his lifetime. To constitute one a stockholder in a corporation it is not necessary that a certificate be issued to him. The title to the shares may exist without the certificate, the latter being only evidence of such title. Williams v. Everett, 200 S.W. 1045; Business Men's Association v. Williams, 137 Mo. App. 575, 588; Vanstone v. Goodwin, 42 Mo. App. 39. (7) The trial court erred in permitting defendant Edith E. Ambruster to testify, over plaintiff's objections and exceptions, as to transactions claimed by her to have occurred prior to the incorporation of the Wm. Ambruster Undertaking Company for the purpose of undertaking to show that she was entitled to more of the stock of that corporation than shown by the articles of association thereof. Having, as administratrix, inventoried the fifteen shares of stock in the estate of William Ambruster, she was estopped to personally assert title thereto. And she could not thus, by parol, vary the terms of the articles of association as a contract between the parties: nor was this testimony competent since one of the parties to such contract is dead. Authorities cited under points 4 and 5; Gibbs v. Haughowout, 207 Mo. 384. (8) By virtue of the oral agreement between the parties of December 4, 1917, the defendant Edith E. Ambruster, for a valuable consideration, became a trustee for plaintiff; from that time forward her possession of the stock of said corporation was in such trust capacity, and such legal title as she held to any thereof was as such trustee; and she is now liable to account to plaintiff for all of said stock, together with the earnings, profits and gains thereon, or derived to her by the control thereof exercised by her, after such time as she should have turned over to plaintiff said stock and the business of said corporation, according to the terms of said agreement, and, together with all increments to such earnings, profits and gains. Rollestone v. Bank of Commerce, 299 Mo. 57; Laughlin v. Laughlin, 291 Mo. 472; In re Estate of Soulard, 141 Mo. 642; Moulden v. Train, 199 Mo. App. 509; Korompilos v. Tompras, 251 S.W. 80; Davies v. Keiser, 297 Mo. 1; Harris Banking Co. v. Miller, 190 Mo. 640; Leeper v. Taylor, 111 Mo. 324; Watson v. Payne, 143 Mo. App. 721; 3 Pomeroy Equity Jurisprudence (4 Ed.) 2232-2239, secs. 1008, 1009; 26 R.C.L. 1194. (9) A valid trust may be created in personalty by parol; the matter being one not within the Statute of Frauds. Moulden v. Train, 199 Mo. App. 509; 1 Perry on Trusts, sec. 86; Korompilos v. Tompras, 251 S.W. 81; Rollestone v. Bank of Commerce, 299 Mo. 57; Harris Banking Co. v. Miller. 190 Mo. 640; Estate of Soulard, 141 Mo. 660; Lane v. Ewing, 31 Mo. 86; In re Kelley v. Kelley, 213 Mo. App. 402, 507; Orr v. Trust Co., 291 Mo. 383.
Holland, Lashly & Donnell for respondents.
(1) A sale by an administrator to himself of property of the estate is not void but is, at most, merely voidable. Mitchell v. McMullen, 59 Mo. 252; Benson v. Benson, 97 Mo. App. 460; 24 C.J. 636, sec. 1592; L.R.A. 1918-B. 26; Otis v. Kennedy, 107 Mich. 312; Scott v. Gamble, 9 N.J. Eq. 218. (a) An heir or distributee may ratify a sale made by an administrator to himself: and the plaintiff ratified the sale now attacked by receipting the funeral bill, the release of which was the consideration for the said sale, and by participating in the administration and by acquiescence through a period of ten years or more, 24 C.J. 219, sec. 739; 24 C.J. 638, sec. 1594d: 24 C.J. 710, sec. 1741; Fuller v. Little, 59 Ga. 338; Boerum v. Schenck, 41 N.Y. 182; Shelby v. Creighton, 65 Nebr 485; Rhodes v. Caswell, 58 N.Y. Supp. 470; L.R.A. 1918-B, 43, 45; Scott v. Gamble, 9 N.J. Eq. 218. (b) The approval of a final settlement in a probate court to which no exceptions were taken constitutes a final judgment which cannot be subsequently attacked, except by a direct proceeding in equity upon the ground of fraud in the procuring of said judgment. Young v. Byrd, 124 Mo. 590; State ex rel. v. Gray, 106 Mo. 526, 533; State ex rel. v. Holteamp, 266 Mo. 347, 371; Michie v. Grainger, 149 Mo. App. 304; Smith v. Hauger, 150 Mo. 437. (c) A judgment of a probate court approving a final settlement, discharging an administrator and vesting the title to property of the estate in a purchaser from said estate, is a judgment not subject to collateral attack. Oldaker v. Spiking, 210 S.W. 59; Wright v. Hetherlin, 277 Mo. 99; Viehmann v. Viehmann, 250 S.W. 565. (d) A collateral attack is an attempt to impeach a judgment in a proceeding not instituted for the express purpose of annulling it; and the proceeding here is a collateral attack upon the judgment of the probate court approving final settlement in the estate of William Ambruster. State v. Ellison, 226 S.W. 559, 563; Licber v. Licber, 239 Mo. 1; 34 C.J. 520. (2) The defense of laches is properly in this case, even though not pleaded by defendants, for the reason that such defense need not be pleaded in an equity suit. Stevenson v. Smith, 189 Mo. 447, 466: Dexter v. MacDonald, 196 Mo. 373: Murphy v. DeFrance, 105 Mo. 53, 69. (3) The mere fact that an administrator inventories certain property in the estate does not bar him from showing that he himself was the owner of said property; and the inventory of the stock of defendant corporation for the obvious purpose of clearing the record title thereto does not preclude Mrs. Ambruster from showing her own right and title to said stock. Dodge v. Lunt, 181 Mass. 320; Sloan's Estate, 254 Pa. 346. (4) The mere fact that corporate stock stands upon the books of the corporation in the name of one does not prevent another who is the equitable or beneficial owner of said stock from showing that he is the real owner. Williams v. Everett, 200 S.W. 1045. (a) William Ambruster and Edith Ambruster owned the stock of defendant corporation as tenants by the entirety, and estates by the entirety may exist in personalty. Johnson v. Johnson. 173 Mo. 91; Lomax v. Cramer, 202 Mo. App. 365; Rezabek v. Rezabek, 196 Mo. App. 673; Craig v. Bradley. 153 Mo. App. 586; Bryan v. Ford, 151 Mo. App. 689; 22 L.R.A. 594, notes; 30 L.R.A. 305. (b) Property purchased with the proceeds resulting from, or the funds of, an estate by the entirety are impressed with the same title as the proceeds or the funds with which said property was purchased. Frost v. Frost, 200 Mo. 474; Blick v. Cockins, 252 Pa. 56; George v. Dutton, 108 Atl. 515, 8 A.L.R. 1014. (5) The fact that no stock certificates were issued at the time of the incorporation of the defendant corporation is important from an evidentiary standpoint, as tending to substantiate the proposition shown by other evidence, that the stock was all owned by William and Edith Ambruster as tenants by the entirety. (6) The oral agreement which plaintiff alleged was made on December 4, 1917, with his mother, was never...
To continue reading
Request your trial