Carrillo v. Taylor

• Decision Date: 26 June 1956
• Docket Number: No. 6086,6086
• Citation: 299 P.2d 188,81 Ariz. 14
• Parties: Arturo R. CARRILLO and Mercedes Carrillo, husband and wife, Rupert Carrillo and Rachel Carrillo, husband and wife, Ysela Carrillo Vacovsky and Lloyd Vacovsky, wife and husband, Eloise Carrillo Aegerter, Concha Knittle and Walter Knittle, wife and husband, and Elizardo Carrillo and Rachel Carrillo, Appellants, v. Elvira Carrillo TAYLOR and William H. Taylor, wife and husband, Leo Carrillo and Henrietta Carrillo, husband and wife, Appellees.
• Court: Arizona Supreme Court

Page 188

299 P.2d 188

81 Ariz. 14

Arturo R. CARRILLO and Mercedes Carrillo, husband and wife, Rupert Carrillo and Rachel Carrillo, husband and wife, Ysela Carrillo Vacovsky and Lloyd Vacovsky, wife and husband, Eloise Carrillo Aegerter, Concha Knittle and Walter Knittle, wife and husband, and Elizardo Carrillo and Rachel Carrillo, Appellants, v. Elvira Carrillo TAYLOR and William H. Taylor, wife and husband, Leo Carrillo and Henrietta Carrillo, husband and wife, Appellees.

No. 6086.

Supreme Court of Arizona.

June 26, 1956.

Darrow & D'Antonio, Tucson, for appellants.

Carlos G. Robles and Odin B. Dodd, Tucson, for appellees.

UDALL, Justice.

The six brothers and sister, above named, joined as plaintiffs (now appellants) in bringing an equitable action, containing two counts, against their sister Elvira Carrillo Taylor and brother Leo Carrillo (defendants-appellees), seeking to impress a trust in plaintiffs' favor-both express and constructive-of a 6/16 interest in an undertaking business founded by their father, known as the Tucson Mortuary. This appeal is from a judgment of the trial court impliedly finding that the plaintiffs had not proven a case. Hereafter the parties will either be referred to by their first names or as plaintiffs and defendants.

The case was tried to the court sitting with a jury. At the close of the trial certain interrogatories were submitted to the jury; all of its answers were unanimous and were completely favorable to plaintiffs' theory of the case; however, this being an equitable proceeding, the answers were only advisory and not binding upon the trial court. See, Rule 39(l), 1956 Rules of Civil Procedure. Ultimately the court elected to disregard these answers and without making any specific findings of its own-as mone had been requested-entered judgment that plaintiffs take nothing by their complaint. Defendants' motion and the clerk's minutes refer to this as a 'motion for judgment notwithstanding verdict' which, technically speaking, is an erroneous nomenclature.

The first question presented is in what light the evidence is to be considered on this appeal. The law is well settled in this jurisdiction that in an equity matter 'While the court need not heed the advice of the jury, it must harken to it.' Stukey v. Stephens, 37 Ariz. 514, 516, 295 P. 973, 974. The final decision being that of the court, all presumptions are in support of its judgment and the appellate court in testing its validity will consider the evidence in the light most favorable to the successful party. Kubby v. Hammond, 68 Ariz. 17, 198 P.2d 134. This court in the case of In re Guardianship of Sorrells, 58 Ariz. 25, 117 P.2d 96, held, in effect, that where a verdict is advisory, the finding made by the trial court, and not the answers given by the jury to interrogatories determines the judgment, and that it is the judgment of the trial court and not the answers of the jury which must be assumed to be correct.

The facts stated in such light are as follows:

Arturo Carrillo and Eloisa Carrillo, his wife, in the year 1917, as a community enterprise, established an undertaking business known as the Tucson Mortuary, on the premises owned by them, at 204 South Stone Avenue in Tucson. There they lived, carried on that business, and reared their eight children, i. e., the plaintiffs and defendants. The father, Arturo, was a licensed mortician. On Fedruary 20, 1931, he acknowledged and recorded a notice of intention to, on 'the 3rd day of March, 1931, sell, assign, and deliver the business now conducted by him * * * including the whole of his stock in trade, to Arturo R. Carrillo (his son) * * *.' Later, on the date specified, he alone executed and acknowledged and recorded a bill of sale of the 'business' with all of the stock in trade.

On February 12, 1935, the son gave notice of his intention to sell the business to Elvira Carrillo, his sister, and on March 8, 1935 gave her a bill of sale to same. This instrument specifies that the fixtures are included, also one Nash automobile used as a hearse.

The father died on January 9, 1937, and his entire estate, including his interest in the premises at 204 South Stone Avenue-all of the net appraised value of $755-was set aside in a summary probate, on April 5, 1937, to the widow Eloisa Carrillo. No reference is made in this probate proceeding to the mortuary business as such.

Notwithstanding the paper transactions, supra, there is substantial evidence (although the jury did not so find) that there was no change in the operation of the business, either real or apparent; that is the father, from 1931 until his death, with the aid of his family, ran the business as he pleased, spent the money as he pleased, and supported the family of ten with the income therefrom. The mortuary bank balance at the time of his death was a minus $16.74.

For a period of approximately thirty-four months from the death of the father until Leo took over, Elvira with the aid of the family operated the business without a licensed mortician. The revenue therefrom was used to support the family.

Defendant Leo, the youngest son, was sent off to a mortician's school, and on November 7, 1939 he obtained a mortician's license. At all times since then he has been in charge of and has successfully operated this growing business. When Leo took over, the bank balance of the mortuary was minus $28.30, and the equipment then on hand and which was there at the death of the father was: an embalmer's table brought from Mexico in 1914, one old safe, some old instruments, two candelabras not in use, one catapult and four chairs, together with the name and good will of the business.

On December 31, 1943 a partnership was formed, evidenced by written articles of partnership, executed by the mother, Eloisa, the daughter, Elvira, and the son, Leo, which were subsequently recorded. The mother contributed the real estate at a recited value of $15,000, being the premises at 204 South Stone Avenue, which was conveyed by a bargain and sale deed to Tucson Mortuary, a co-partnership; Elvira contributed the 'business of undertaking under the firm name of Tucson Mortuary * * * and motor vehicles and equipment necessary to carry on said business * * * the value of which is approximately Fifteen Thousand Dollars * * *'; Leo's contribution was not monetary but only that he '* * * is a licensed embalmer and funeral director of the State of Arizona, and has been engaged in the business of undertaking, embalming and funeral directing for several years, * * *'. The partnership agreement expressly provided that 'The death or retirement of any partner shall not dissolve the partnership as to the other partners * * *' and the exclusive right was granted therein to the survivor or survivors to purchase the share or interest of the deceased partner at book value.

Eloisa, the mother, died on March 17, 1951. Her estate was probated, Leo acting as administrator. With the sanction of the probate court, and as provided in the partnership agreement, the interest of the mother was sold to Leo and Elvira, as the surviving partners, and the cash proceeds amounting to $19,213.77, together with the residue of the estate, was distributed on December 22, 1952 to the eight children in equal shares of $2,575.81. No appeal was taken from the decree of distribution and it has long since become final, nor have the plaintiffs returned or offered to return what they received from the sale in probate.

With reference to the alleged trusts, plaintiffs kept shifting their position during the trial so that the lower court experienced difficulty, as have we, in determining precisely plaintiffs' theory as to just when the trust originated, who created it and who the settlor was. To begin with it seems to have been their position-as set forth in the first count of the complaint-that the father, Arturo, by parol created an express trust in 1931 by transferring the 'business' and all personalty in connection therewith to the son, Arturo R., as trustee for the benefit of the mother during her lifetime and the balance to the children on her death; and in the second count an attempt is made to have the court declare the real property to be a natural increment to the trust res, upon the theory that the income from the trust res was used by Elvira to purchase the real property. The prayer is that plaintiffs be decreed to be the equitable owners and entitled to an undivided 6/16ths of both the real and personal property comprising the 'Tucson Mortuary', and for an accounting.

The defendants, in their first amended answer, defended on the grounds, among other things, that: No trust was ever intended; no trust was ever created; that the ancestor had no property of any substantial consequence which he could convey in trust; that he retained the equitable interest in and control of all of his property until his death; that the instruments were intended to delay his creditors; that the transactions were within the statute of frauds; that all of the property was community property and that the wife did not join in the supposed trust; that the property of the ancestor was consumed by his family; there was nothing out of which to create a trust; and that the action was barred by limitations; that the decree of distribution in the mother's estate was res judicata as to the rights of plaintiffs; and that plaintiffs had not offered to do equity.

At the trial, upon inquiry being made as to how they arrived at the fraction 6/16ths, counsel at first conceded that one-half went outright to Leo and it was the half belonging to Elvira they were seeking to impress a trust upon. Nevertheless, during their case in chief the plaintiffs unsuccessfully sought leave to amend their complaint by adding a third cause of action to establish a constructive trust on all of said property because Leo, as administrator, sold their mother's interest in the parthership property to...