De Atley v. Streit

• Citation: 263 P. 967,81 Mont. 382
• Decision Date: 30 January 1928
• Docket Number: 6230.
• Parties: DE ATLEY et al. v. STREIT et al.
• Court: Montana Supreme Court

263 P. 967

81 Mont. 382

DE ATLEY et al. v. STREIT et al.

No. 6230.

Supreme Court of Montana

January 30, 1928

Rehearing Denied Feb. 14, 1928.

Appeal from District Court, Carbon County; O. F. Goddard, Judge.

Suit by Richard De Atley and another against Estella Streit and husband and Katherine. Libby and husband. Judgment for plaintiffs, and defendants Katherine Libby and husband appeal. Affirmed.

C. C Rowan, of Red Lodge, and F. F. Haynes, of Forsyth, for appellants.

John G Skinner, of Red Lodge, and Philip Savaresy, of Billings, for respondents.

STARK J.

This is an appeal from a judgment and decree entered in the lower court canceling and setting aside a deed executed and delivered to the defendant Estella Streit by the plaintiffs on the 2d day of June, 1923, conveying to her certain ranch property; and also a deed from the defendant Estella Streit and her husband, George R., dated March 6, 1925, transferring and conveying the same property to the defendant Katherine Libby.

The complaint alleged that the plaintiffs were advanced in years and for a long time prior to the commencement of this action had been infirm in health; that the defendants Estella Streit and Katherine Libby were their daughters and the defendants George R. Streit and J. E. Libby were the husbands respectively, of said daughters; that on June 2, 1923, the plaintiffs were the owners of the property mentioned in the foregoing deed; that the same consisted of an irrigated farm well equipped to be operated as such, located near Boyd, in Carbon county; that by reason of their advanced age and the infirmity of their health the plaintiffs were desirous of making a disposition of their property and effects so as to secure for themselves support and maintenance during the remainder of their lives, and, in conformity with such desire, on the 2d day of June, 1923, conveyed the farm and also the personal property used in connection therewith to the defendant Estella Streit, with the understanding and agreement that she should support, maintain, and care for the plaintiffs during their lifetimes and at all times furnish them with proper and sufficient food, clothing, shelter, and medical attention, and treat them with reverence, respect, and affection, and that said agreement was the only consideration for the conveyance of said premises and personal property to her; that thereafter, about the 6th day of March, 1925, with the knowledge and consent of the plaintiffs and of the defendant Katherine Libby, the said Estella Streit conveyed said premises and personal property to the defendant Katherine Libby with the understanding and agreement on the part of said Katherine Libby that she would, during the lifetimes of the plaintiffs, care for, support, and maintain them, and furnish them with proper and sufficient food, clothing, and medical attention, and treat them with reverence, respect, affection, and devotion, and that the only consideration for said conveyance was the agreement last mentioned. The complaint then alleges that the defendants, in violation of said agreement, had wholly failed to provide the plaintiffs with proper or sufficient food, clothing or medical attention and had not treated the plaintiffs with proper respect, reverence, affection, or devotion, and had compelled the plaintiffs to eke out a meager livelihood from their own labor and efforts, and that these acts of the defendants in failing to comply with their agreement were working a great hardship on the plaintiffs and were causing a total absence, failure, and lack of consideration for the conveyances of the property as above set out. The plaintiffs further offered in their complaint to refund all payments made or funds advanced by defendants for their benefit and asked for an accounting of the rents, issues, and profits of the premises during the time they had been in possession of the defendants.

The defendants filed a general demurrer to the compaint, which was overruled. The defendants Estella Streit and George R. Streit did not answer; the defendants Libby answered, putting in issue the material allegations of the complaint and setting out items of money advanced and expenditures made by them to and for and in behalf of the plaintiffs. They also alleged that, by reason of facts which were stated in their separate defenses, the plaintiffs were estopped from asking for a cancellation of the deeds in question. Issue was joined on the affirmative matters alleged in the answer by plaintiffs' reply thereto.

The case was tried to the court without a jury. The court found the issues in favor of the plaintiffs and by its decree ordered the cancellation of the deeds on the ground that there had been a total failure of consideration therefor. The defendants Katherine Libby and J. E. Libby have appealed from the judgment.

1. It is first contended by defendants that the complaint does not state a cause of action and that the court erred in overruling their objection to the introduction of any evidence made on that ground at the beginning of the trial. This contention is based on the ground that the complaint does not allege either actual or constructive fraud in the procurement of the conveyance of the land to the defendants, or that it was agreed and understood between the parties at the time of the conveyance that a breach of the oral agreement should in any way affect the validity of the deed so as to entitle the plaintiffs to a reconveyance.

Examination of a large number of cases discloses that the courts in this country, with a few exceptions, regard contracts of the character set out in the complaint, entered into between parties who occupy fiduciary relations toward each other, such as husband and wife or parent and child, in which the grantee agrees to furnish maintenance and support to the grantor as the consideration for the conveyance of all or a major portion of his property, as being in a class by themselves. As was said in Payette v. Ferrier, 20 Wash. 479, 55 P. 629, quoting from Bogie v. Bogie, 41 Wis. 219:

"The conveyances of property by aged and infirm people to their children in consideration of promised support and maintenance are somewhat peculiar in their character and incidents, and must sometimes be dealt with by the court on principles not applicable to ordinary conveyances."

Quite generally, upon a breach by the grantee of his agreement to support the grantor, the courts afford the latter a relief by way of rescission on various grounds, a common one being stated as a failure of consideration. Hegge et al. v. Hegge et ux., 44 S.D. 555, 184 N.W. 800; Shepardson v. Stevens, 77 Mich. 256, 43 N.W. 919; Haataja v. Saarenpaa, 118 Minn. 255, 136 N.W. 871; Lane v. Lane, 106 Ky. 530, 50 S.W. 857; Peck v. Hoyt, 39 Conn. 9; Kusch v. Kusch, 143 Ill. 353, 32 N.E. 267; Houston v. Greiner, 73 Or. 304, 144 P. 135. The foregoing cases sustain the position of the lower court in setting aside the deeds in question on the ground of failure of consideration; but the same result might have been reached on other grounds, for, as stated in 18 C.J. p. 169, § 49: "Failure of a grantee to perform his promise, in consideration of a transfer of land, to support the grantor may be presented as a ground for relief in behalf of the grantor as evidencing fraud in the transaction, or as constituting a breach of a condition subsequent, or as justifying relief upon the ground of failure of consideration. Courts of equity have a marked tendency, owing to the usual hardship of these cases, to afford the grantor relief, particularly where he is of advanced years and without other means, and frequently proceed upon apparently all of these grounds, without definitely relying upon any one of them."

Speaking of circumstances analogous to those stated in the complaint in this case, the Supreme Court of Minnesota, in Bruer v. Bruer, 109 Minn. 260, 123 N.W. 813, 28 L. R. A. (N. S.) 608, well said:

"Contracts and agreements of the kind are quite familiar to the courts. They are, as a rule, made by people well along in years with a child or other relative, and are intended to secure to the old people proper and suitable support and maintenance during their declining years, at the same time relieving them of the care and responsibility incident to the management of their affairs. They part with their property in the expectation and belief that their future necessities and comforts are fully provided for, and in an abiding faith that natural affection and filial duty will prompt and secure a faithful discharge of the obligations assumed by the child to whom they convey. There is in such transactions an element of confidence reposed by the old people in their grantee, sacred in its nature, a breach of which, and retention of the benefits, no court should

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