Appolonio v. Baxter

• Court: U.S. Court of Appeals — Sixth Circuit
• Writing for the Court: SIMONS, , and ALLEN and STEWART, Circuit
• Citation: Appolonio v. Baxter, 217 F.2d 267 (6th Cir. 1954)
• Decision Date: 06 December 1954
• Docket Number: No. 12220-12225.,12220-12225.
• Parties: E. J. APPOLONIO, Harold Danziger, Marshall L. Harper, J. M. Wood and O. F. Littlefield, v. Louise Rhea BAXTER, Administratrix C.T.A. of the Estate of Isaac T. Rhea. E. J. APPOLONIO v. Louise Rhea BAXTER, Admx. etc. Harold DANZIGER v. Louise Rhea BAXTER, Admx. etc. Marshall L. HARPER v. Louise Rhea BAXTER, Admx. etc. J. M. WOOD v. Louise Rhea BAXTER, Admx. etc. O. F. LITTLEFIELD v. Louise Rhea BAXTER, Admx. etc.

217 F.2d 267 (1954)

E. J. APPOLONIO, Harold Danziger, Marshall L. Harper, J. M. Wood and O. F. Littlefield, v. Louise Rhea BAXTER, Administratrix C.T.A. of the Estate of Isaac T. Rhea.

E. J. APPOLONIO v. Louise Rhea BAXTER, Admx. etc.

Harold DANZIGER v. Louise Rhea BAXTER, Admx. etc.

Marshall L. HARPER v. Louise Rhea BAXTER, Admx. etc.

J. M. WOOD v. Louise Rhea BAXTER, Admx. etc.

O. F. LITTLEFIELD v. Louise Rhea BAXTER, Admx. etc.

Nos. 12220-12225.

United States Court of Appeals Sixth Circuit.

December 6, 1954.

Walter P. Armstrong, Jr., Memphis, Tenn. (Benjamin Goodman, of counsel, and Armstrong, McCadden, Allen Braden & Goodman, Memphis, Tenn., on the brief), for appellants.

A. Longstreet Heiskell, Memphis, Tenn., Lewis Rhea Baxter, Jacksonville, Fla., Chandler, Shepherd, Heiskell & Williams, Memphis, Tenn., Rogers, Towers & Bailey, Jacksonville, Fla., for appellee.

Before SIMONS, Chief Judge, and ALLEN and STEWART, Circuit Judges.

SIMONS, Chief Judge.

The five appellants are claimants against the estate of appellee's decedent who died in Shelby County, Tennessee, on October 2, 1952. They filed a joint claim against his estate in administration proceedings pending in the Probate Court of Shelby County. At the same time, each also filed an individual claim against the estate. The causes were all removed to the United States District Court, where the administratrix, after obtaining answers from the claimants to interrogatories and filing depositions of persons listed in such answers as witnesses, moved for summary judgment on the ground that there was no provable fact issue to be determined by a jury. The motion was sustained, a judgment for the defendant entered, and the appeals followed.

The decedent, Isaac T. Rhea, during his lifetime, was president and principal stockholder of Mente & Company, Inc., a corporation with industrial plants in Louisiana. The joint claim recites that, on numerous occasions, Rhea contracted with the claimants, by repeated promises, that in consideration of their agreement to serve the corporation at salaries substantially lower than what each would otherwise have been entitled to receive, and substantially lower than salaries paid by other comparable companies to similar key executives, to leave to the claimants, upon his death, all of his interest and ownership in Mente & Company, Inc., in the proportion that each claimant's individual salary bore to the aggregate salary of all five claimants. It also recited that the claimants performed the contract with the decedent through continued service to the company for inadequate compensation but that the decedent breached the contract and left no stock of the corporation to them by will, or otherwise, that the stock owned by the decedent was sold by his administratrix for an aggregate price of $2,239,368.73, and that by reason of Rhea's failure to fulfill his contractual undertakings, the claimants were damaged in that amount, that it was a valid obligation of the estate upon which no payment in whole, or in part, had been made and that they are entitled to the money in the proportion set up in the claim for each. These proportions are: Danziger 35%, Appolonio 25%, Littlefield 15.50%, J. M. Wood 15.50% and M. L. Harper 9%. Simultaneously, with the filing of the collective claim, each claimant filed his individual claim, counting upon the identical contract recited in the joint claim and seeking his prorata share of the proceeds derived from the sale of the Rhea stock, Danziger claiming $783,779.06, Appolonio $559,842.18, Harper $201,543.19, Wood $347,102.15 and Littlefield $347,102.15.

The decedent left a will which bequeathed all of his property to his wife, Posey Blanker Rhea. The will could not be probated, since Mrs. Rhea's death preceded that of her husband by four weeks. The administratrix, Louise Rhea Baxter, sister of the decedent and his only living heir, consequently, took the entire estate under state laws of intestacy. She qualified as administratrix and the business of Mente & Company, Inc., having been conducted with the aid of the claimants for approximately ten months at substantial loss, she succeeded, after much negotiation in which the claimants Appolonio and Danziger actively participated, in selling the Rhea stock. This was represented by them to the purchaser as the shares of Mrs. Baxter. There was no assertion by them of ownership therein. To a lesser extent, the other claimants, likewise, participated. They were aware that the stock was being offered for sale by the administratrix, knew of the negotiations for sale, and Wood and Littlefield assisted by showing their respective plants to prospective purchasers. They, likewise, asserted no financial interest in the decedent's shares.

Rule 56 of the Federal Rules of Civil Procedure, 28 U.S.C.A., deals with summary judgments and provides in subsection (c) as follows: "The judgment sought shall be rendered forthwith if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Of this Rule, a distinguished member of the Drafting Commission, said: "Another radical departure from our Tennessee practice is a rule providing for summary judgments. Under this Rule, either party may move, with or without affidavits, for a summary judgment. * * * The value of this practice is that it weeds out those cases where there is no real cause of action and those where the defense is merely frivolous." 15 Tennessee Law Review, 614, 625.

In support of her motion for summary judgment, the administratrix addressed certain interrogatories to the claimants, inquiring as to the date of their employment, their several capacities, their salaries and bonuses, and the dates and amount of increases in both. The answers disclosed that during the period when the alleged contract was made, or reaffirmed, there had, in each case, been substantial increases, both in salary and bonuses, up to the time of the decedent's death. In depositions taken of five witnesses, listed by the claimants, there were disclosed representations alleged to have been made by the decedent that the company would some day "belong to the boys," without any designation therein as to who constituted the class referred to and without any information from the decedent as to the share each was to get.

The motion for summary judgment is grounded upon the proposition that the alleged contract is not supportable by legal proof because of the provisions of the so-called Dead Man's Statute, Tennessee Code § 9780, because of the Tennessee Statute of Frauds §§ 7197, 7831, the Statute of Limitations § 8600, the doctrines of estoppel, laches, hearsay, and the lack of an adequate consideration to support the contract, without which an oral agreement to make a will is unenforceable under §§ 8098.1-8098.6.

It is indisputable, upon the facts therein alleged, that the claims are based upon an oral contract to make a will. The claimants aver, in their joint claim, a promise by the decedent "to leave to claimants, upon the death of the decedent, all of decedent's interest and ownership in Mente & Company, Inc." The general rule is that such oral contract must be definite; proven as pleaded; cannot be established by loose or casual conversation; must be fair and the proof leave no reasonable doubt that the contract as pleaded was in fact made and has been performed by the parties relying on the contract. This was said in respect to the provisions of a Missouri contract recited in Plemmons v. Pemberton, 346 Mo. 45, 139 S.W.2d 910, but we recognized it as sound in McCabe v. Bagby, 6 Cir., 186 F.2d 546, 549. To the same effect is our decision in Rash v. Peoples Deposit Bank & Trust Co., 6 Cir., 192 F.2d 470, where we held that the rule in Kentucky, as to admissibility of conversations between a deceased person and a litigant seeking to establish a claim upon him, is identical with that recognized in almost all jurisdictions. It is true, of course, that if trial were had, it is conceivable, although highly improbable, that the quantum of proof as to the making of the alleged contract would be...