Attorney General v. Flynn

• Decision Date: 28 May 1954
• Citation: 331 Mass. 413,120 N.E.2d 296
• Parties: ATTORNEY GENERAL v. FLYNN. . Argued April 7, 12-15, 20, 21, 1954
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 296

120 N.E.2d 296

331 Mass. 413

ATTORNEY GENERAL v. FLYNN.

Supreme Judicial Court of Massachusetts.

Argued April 7, 12-15, 20, 21, 1954.

Decided May 28, 1954.

George Fingold, Atty. Gen., Andrew T. Trodden, Arnold Salisbury and Charles F. Marsland, Jr., Asst. Attys. Gen., with him, for informant.

George A. McLaughlin, Boston, Walter H. McLaughlin, Charles S. McLaughlin, Boston, and Arthur Gilman, Swanpscott, with him, for respondent.

Before QUA, C. J., and RONAN, WILKINS, SPALDING and COUNIHAN, JJ.

QUA, Chief Justice.

After the order of the court filed February 17, 1954, denying the respondent's motion to dismiss and his motion to decline jurisdiction and overruling his demurrer, which order is to be reported with this opinion, ¹ and after the filing of specifications as ordered by the court in relation to certain numbered paragraphs of the amended information, and after the paragraphs numbered 14 and 15 had been struck from the information on motion of the respondent because the Attorney General had declined to specify as ordered, this cause was fully heard on the merits by a majority of the court as required by G.L. (Ter.Ed.) c. 211, § 4, as appearing in St.1945, c. 465.

On July 14, 1947, the respondent was appointed one of the trustees of a charitable trust created under the will of Edward Y. Perry, late of Hanover in the county of Plymouth. At about that time the personal property of the estate was inventoried at $126,809.56, and there were also some twenty-five parcels of real estate located in Hanover, Marshfield, and Hanson and appraised at $110,650. The will gave the trustees power to sell real estate without license from the Probate Court. There were two other trustees, Walter J. MacDonald, who, like the respondent, was a lawyer, and John F. Twohig, who was not a lawyer. The respondent and Twohig were appointed trustees in place of two former trustees who had been removed by the Probate Court for maladministration of the trust in matters with which we are not now concerned. In the former proceedings the present respondent had acted as attorney for his present cotrustee MacDonald, who was a petitioner in those proceedings. Soon after the appointment of the respondent as trustee the office of the trust was removed to the law office of the respondent in Brockton. Thereafter the books of the trust were kept at the respondent's office by the respondent's secretary. The bank account of the trust and its financial affairs generally, including the preparation of probate accounts, were handled by the respondent or by his secretary under his direction. The trustees had adopted the policy of selling off the real estate of the trust, and by some time in the spring of 1950 they had disposed of practically all but two of the parcels. With some trifling exceptions, there remained unsold only the property known as the Perry homestead located in Hanson, consisting of a house in poor condition with about eighty-four acres of land, part of which was on the shore of a pond, and with two wood lots in addition of about twelve acres and nine acres respectively, and the property in Hanover known as the Hunt property, consisting of a house and about 18,309 square feet of land. The homestead with the woodland was appraised at various times at figures ranging from $12,000 down to $10,500. The Hunt property had been appraised at $5,500. In November, 1950, the respondent was elected district attorney of the newly created Plymouth District. See St.1948, c. 423.

1. The Winslow Transaction.

Under date of June 15, 1950, at the instance of the respondent, the three trustees executed a formal agreement to convey the Perry homestead to one Arthur F. Winslow of Hartford, Connecticut, for $10,000 in cash, papers to be passed on or before September 1, 1950. Winslow was a cousin of the respondent. The respondent represented to his cotrustees that Winslow would like to buy, and would buy, the property for $10,000 cash. We believe this representation was essentially untrue. It carries the connotation that Winslow actually intended to become a bona fide buyer on his own account. Winslow never signed the agreement to buy. There is nowhere in the case any evidence that before the agreement was signed by the trustees he had ever authorized the respondent to represent that he, Winslow, actually intended to buy this property; nor is there any evidence that he did intend to buy it or had any interest in buying it for himself at a price of $10,000, or at any price.

Under date of September 1, 1950, which was the date fixed for the conveyance in the unilaterally signed agreement, a deed of the Perry homestead running to Winslow was executed by the three trustees, and under the same date a mortgage back was given by Winslow to the trustees for $9,000, leaving only $1,000 to be paid in cash. These of course were not the same terms as those on which conveyance was to be made according to the partially signed agreement. That agreement made no provision for a mortgage back of $9,000 out of the purchase price of $10,000. Although the respondent testified that this deed and the mortgage back were both executed on or about the date they bear, to wit, September 1, 1950, serious doubt is thrown upon this by the fact that in both deed and mortgage in both in testimonium clauses and in the acknowledgments--four places in all--the date 1951 was first typed in and then changed by hand by the respondent to 1950. There was no explanation of this curious circumstance, and we are unable to find when the deed and mortgage were delivered, except that it was on or before February 12, 1951, when both papers were recorded.

There is no doubt that by the time of the delivery of this deed and mortgage the respondent was actually the purchaser from his own trust of the Perry homestead and the two wood lots. Winslow, although ostensibly the purchaser and mortgagor, had no interest whatever in the purchase. He was merely a straw for the respondent. The respondent himself so testified. The respondent's explanation was that when the unilaterally signed agreement was made out in June, 1950, he believed Winslow would buy, but that before September 1 Winslow changed his mind and informed the respondent that he was not interested; and that the respondent then told his cotrustees that since he had represented to them that Winslow would buy, he, the respondent, would 'take it over.' This explanation we do not accept. There was much evidence tending to show, and we find, that the respondent's cotrustees did not know until long after the deed was recorded that the respondent was the real buyer.

Although the respondent had bought, ostensibly through Winslow, the homestead property and the wood lots for only $1,000 cash and a $9,000 mortgage, he did not pay the $1,000 or any part of it into the trust until May 4, 1951. Through Winslow he held title to the property from the date the deed was delivered until May 4, 1951, without having paid any money. His cotrustees did not know that 'Winslow' had obtained title without paying any money. When the respondent made out a trustees' account for them to sign for the year 1950 he caused an item of $1,000 of 'cash received' as of September 1, 1950, from the sale to 'Winslow' to be inserted in schedule A, and a corresponding item of 'cash on hand 1000' to be inserted in schedule C. No such cash had been received by the trust or was on hand during 1950. However, the respondent did cause this sum of $1,000 to be paid into the trust before the account was actually filed in 1951.

It was the practice of the trustees when real estate was sold to make a charge for 'extra services' in showing it and in connection with the sale which should roughly compare with the commission that a broker might charge. Such charges were made by the three trustees in June, 1950, at the time the so-called agreement was made for the supposed sale to Winslow. The respondent received $200 from the trust for his share, although he himself was in fact the purchaser. He also received from the trust an allowance in one lump sum for services in 'passing papers' in fourteen different transfers, including this transfer to 'Winslow.'

Shortly after acquiring the homestead property and the wood lots through the deed to Winslow the respondent began to make efforts to sell the property. He offered it to different people for $20,000. He testified, however, that in one instance he offered it for $10,000. He received $200 on account of an easement for wires across the property. On October, 1951, he sold one of the wood lots to Lot Phillips & Co., Corporation, for $1,901. He then caused his straw Winslow to convey the property to a Miss Stefani, who was a secretary in the respondent's district attorney office, and who thenceforward acted as his straw. He caused Miss Stefani to convey this wood lot to the Phillips concern by deed dated October 19, 1951. The trust released this lot from its mortgage but received nothing in return. The respondent kept the purchase price. After the conveyance of the wood lot the respondent continued to offer the remaining land at $20,000. On October 31, 1952, he received through Miss Stefani $300 from one Perkins for a forty-five day option to purchase the property for $20,000. This option was not taken up, and the respondent kept the $300. Early in 1953 he sold the remaining property standing in Miss Stefani's name, except the remaining wood lot, to Gil-Rich Realty, Inc., for $20,000, and caused Miss Stefani to convey to that corporation by deed dated February 2, 1953. He then paid off to the trust its $9,000 mortgage with accrued interest.

It thus appears that, if we take the respondent's date for the conveyance to Winslow, September 1, 1950, the respondent within a period of two years and five months, upon an original money investment of $1,000, had received a total of $12,401, not including what the trust paid him for services in...