Breidenthal v. Breidenthal

• Decision Date: 07 December 1957
• Docket Number: No. 40478,40478
• Citation: 318 P.2d 981,182 Kan. 23
• Parties: Keolna W. BREIDENTHAL, Appellant and Cross-Appellee, v. George Gray BREIDENTHAL, Individually, Appellee, and Willard J. Breidenthal, Mary G. Breidenthal, Ruth B. Snyder, John W. Breidenthal, and George G. Breidenthal, as Partners, Doing Business under the Firm Name and Style of Security Investment Gompany, Appellees and Cross-Appellants.
• Court: Kansas Supreme Court

Page 981

318 P.2d 981

182 Kan. 23

Keolna W. BREIDENTHAL, Appellant and Cross-Appellee, v. George Gray BREIDENTHAL, Individually, Appellee, and Willard J. Breidenthal, Mary G. Breidenthal, Ruth B. Snyder John W. Breidenthal, and George G. Breidenthal, as Partners Doing Business under the Firm Name and Style of Security Investment Gompany, Appellees and Cross-Appellants.

No. 40478.

Supreme Court of Kansas.

Dec. 7, 1957.

Rehearing Denied Jan. 17, 1958.

Syllabus by the Court.

The record in an action by a wife for a divorce, child custody, alimony and property division in which she joined as parties defendant four members of a family partnership having alleged her husband owned an undivided one-fifth interest therein, examined and held: Under the allegations of the petition and supplemental petition, the members of the partnership were proper and necessary parties defendant in order to have determined the ownership of the property alleged to be involved and the extent and worth of the husband's interest in the partnership, and further held: That the trial court erred in sustaining the motion of the defendants other than her husband to dismiss the action as to them, and in dissolving the restraining order as more fully set forth in the opinion.

J. W. Mahoney, Kansas City, argued the cause, and William E. Carson, Kansas City, was with him on the briefs, for appellant and cross-appellee.

Arthur J. Stanley, Jr., Kansas City, argued the cause, and was on the briefs for appellee, George Gray Breidenthal. N. E. Snyder, Kansas City, argued the cause, and was on the briefs for appellees other than George Gray Breidenthal, and cross-appellants.

FATZER, Justice.

This is an action by a wife for divorce, child custody, alimony and property division. Plaintiff (appellant) joined as parties defendant four members of a family partnership in which her defendant husband, George Gray Breidenthal, allegedly owned a one-fifth interest, and secured an order restraining defendants from altering the partnership interests during the pendency of the action. The trial court sustained a motion of defendants other that George to dismiss the action and dissolve the restraining order as to them, and made rulings on other preliminary motions. Plaintiff appeals from the order dismissing the action and dissolving the restraining order as to the defendants other than George. Defendants other than George have cross-appealed from the order overruling their demurrer and motion to strike certain allegations from plaintiff's petition and supplemental petition.

The action was commenced May 9, 1956. Plaintiff alleged that the parties were married February 7, 1934, at Olathe; that George was guilty of extreme cruelty and gross neglect of duty; that a son, George Gray Breidenthal, Jr., was born March 22, 1948; that for approximately thirteen years of their married life she had worked and earned wages which were used in their mutual acquisition of property and for their necessary living expenses, and as a result of their joint efforts, as well as by gift and accretion, they had accumulated certain personal property consisting of household goods and furniture in the possession of plaintiff, a 1956 Oldsmobile automobile in the possession of George, and an equity in a home in Kansas City, Kansas, occupied by her minor son and her. She further alleged they owned certain insurance policies, government bonds, stock in corporations, and that George was the owner of an undivided one-fifth interest in a family partnership known as the Security Investment Company formed in July, 1946, between Willard J. Breidenthal, his wife Mary G. Breidenthal, and their children, Ruth B. Snyder, John W. Breidenthal and the defendant George Gray Breidenthal, for the purpose of investment in securities and real estate; that the major portion of George's assets consisted of that partnership interest; that the partnership had assets in excess of four million dollars and an annual income of over $200,000; that she was entitled to temporary maintenance in accord with George's taxable income for 1955 of $50,065.20, and to have the partnership interest considered in determining alimony, property division and child support allowance; and, that it was essential to restrain the defendants from transferring or altering any of the partnership interests during the pendency of the suit and until her rights and the rights of her minor son were fully determined.

Pursuant to the prayer of the petition, the trial court issued an order restraining George and the defendants other than George from disposing of or altering any of the partnership assets or interests during the pendency of the action, and an order directing George to pay certain sums to the plaintiff for temporary alimony, child support money and for attorney's fees.

On May 22, 1956, defendant George Breidenthal filed a motion to modify the order for temporary alimony. In his supporting affidavit he stated that he had sold his interest in the family partnership on May 6, 1956, and that by the terms of sale he had no right to receive the proceeds until May 6, 1961, and that those proceeds were subject to reduction by the payment of his share of the partnership debts. In addition he stated that his taxable yearly income, including salary and dividends, was then only $6,890, and that in addition to his right to receive the proceeds of the sale of his partnership interest, his property consisted of securities worth about $19,000, a 1956 Oldsmobile automobile, and an equity in real estate of about $6,000 owned jointly with the plaintiff.

On May 23, 1956, the defendants other than George moved to vacate and dissolve the restraining order and for dismissal of the action as to them, on the ground that George was no longer a member of the partnership, since he had sold his interest to his father, Willard J. Breidenthal, in consideration of a credit to him on the books of the partnership of the value of his original interest plus 100 percent profit from July 8, 1946, subject to the debts of the partnership and to George's debts to members of the partnership, the balance of which was not subject to his withdrawal for five years. They further alleged that they were not within the scope of the provisions of G.S.1949, 60-1507 and that the petition did not state a cause of action as to them.

On May 23, 1956, plaintiff filed a supplemental petition in which she alleged that the purported sale of May 6, 1956, was not a bona fide transfer of George's partnership interest; that it was simply a device to put that portion of George's assets represented by the partnership interest beyond her reach, the reach of her minor child, and the reach of the court; that for several months prior to suit the parties had negotiated for a settlement of their property differences; that the negotiations had reached an impasse and were finally terminated on May 4th or 5th, 1956, before the action was filed; that the negotiations had been carried on in good faith and with the implied understanding that no change in the status quo of the partnership would be made until a settlement was reached or a court determination made. She further alleged that the market value of the partnership assets had increased since the December 1951 statement of account, which she attached; and, that the 1955 partnership income was $320,896.03 as shown by George's 1955 income tax return, which was attached to the petition. She attached a copy of the original articles of partnership, reduced to writing in June, 1948, which indicated that the purported transfer was not in accord with its terms; that the spouses of each of the partners had given their written acceptance to such articles, and that the original market value of the partnership assets was more than twice the assigned book value. She alleged that the failure of the defendants other than George to furnish her with a current statement of the partnership's assets and liabilities, and their secretive attitude toward those assets and toward the disclosure of them to her, the agreement to defer payment to George for five years, and the timing of the transfer of George's interest in the partnership's assets coincident with the breakdown of negotiations, showed that the transfer was not in good faith and was a collusive arrangement between George and Willard J. Breidenthal for the purpose of defeating the rights of the minor son of the parties and plaintiff and to withhold from the court information which it must have in order to determine fairly and intelligently the rights of the parties. She further alleged that it was necessary to secure information from the defendants other than George in order to determine the property rights of the parties and that a restraining order was necessary to prevent disposal of the property until those rights had been determined.

Plaintiff also filed other motions for appointment of an auditor of the partnership, to increase the temporary alimony and for money for replacement of clothing and furniture damaged by a fire in her home.

On June 8, 1956, the defendants other than George filed a demurrer to the petition and supplemental petition on the grounds that the court had no jurisdiction of the action as to the defendants; that the petitions failed to state a cause of action against them; and that if they did state a cause of action, then several causes of action were improperly joined. These defendants also moved to strike certain allegations from plaintiff's petition and supplemental petition.

On June 21, and 22, 1956, the trial court proceeded to take evidence upon the motion of the defendants other than George to dissolve the restraining order and to dismiss the action, together with other motions, the substance of which, in view of our conclusions later stated, need not here be detailed. At the close of the hearing, the defendants other than George demurred to the evidence and moved to...