Christian v. Waialua Agr. Co., 8329.

Decision Date09 December 1937
Docket NumberNo. 8329.,8329.
Citation93 F.2d 603
PartiesCHRISTIAN v. WAIALUA AGR. CO. et al. WAIALUA AGR. CO. v. CHRISTIAN et al.
CourtU.S. Court of Appeals — Ninth Circuit

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Charles M. Hite, of Honolulu, T. H., and Sloss, Turner & Finney, M. C. Sloss, E. D. Turner, Jr., and Charles E. Finney, all of San Francisco, Cal. (Sloss, Turner & Finney, of San Francisco, Cal., of counsel), for appellant Christian.

Alfred L. Castle, of Honolulu, T. H., and Herman Phleger and Maurice E. Harrison, both of San Francisco, Cal. (Robertson, Castle & Anthony, of Honolulu, T. H., and Brobeck, Phleger & Harrison, of San Francisco, Cal., of counsel), for cross-appellant Waialua Agr. Co.

Before WILBUR, GARRECHT, and HANEY, Circuit Judges.

HANEY, Circuit Judge.

A guardian of Eliza R. P. Christian, hereinafter referred to as the ward, filed a petition in a court in the Territory of Hawaii, against Waialua Agricultural Company, Ltd., hereinafter referred to as the company, James L. Holt, and Annie Holt Kentwell. The petition prayed that a lease, an agreement, and a deed, all covering an interest in real property in the Territory, and all alleged to have been made by the ward when incompetent, be set aside; that the company be compelled to reconvey the property and to account for the reasonable rental value thereof. The Supreme Court of the Territory, 31 Hawaii 817, granted part of the relief asked, and denied the rest. Both parties have appealed.

R. W. Holt, who married a native Hawaiian, died in 1862 leaving a will by the terms of which some 14,000 acres of land in Hawaii were left in trust; one-third of the income was to be paid to each of his three sons for life; and at the death of each son, one-third of such lands was to vest in fee in the heirs at law of the son who died. All three of the sons survived the testator and were named James R. Holt, John Dominis Holt, and Owen J. Holt.

James R. Holt was the father of two sons, one of whom is named James Lawrence Holt. John Dominis Holt, who married a native Hawaiian, was the father of two children, one of whom died in infancy, and the other of whom is appellant's ward, Eliza Holt Christian. The other son, Owen J. Holt, was the father of nine children, one of whom is Annie Holt Kentwell.

On June 10, 1891, Owen J. Holt died, and as a result of his death an undivided one twenty-seventh interest in fee simple in the lands vested in each of his nine children.

In 1893, James Lawrence Holt acquired the sole title to the expectancy of the one-third interest in the event that he survived his father. He also acquired prior to July, 1902, control of the life interest of his father, and of John Dominis Holt, his uncle, and the father of appellant's ward. Such control was held in the name of a trustee.

On March 17, 1905, a lease of the lands was made for a term of twenty-five years from April 1, 1905, to the company, by the administrator of the testator's estate, the owners of the vested interests, and by the owner of the life interest in two-thirds of the estate. The ward was named as a party of the third part, and covenanted that the company "shall peaceably and quietly hold and enjoy the use and possession of said demised premises, free from let or hindrance from any other person or persons having lawful claim or title to the same, or to any thereof." This document was signed and acknowledged by the ward.

On August 31, 1906, the ward and Annie Holt Kentwell entered into a contract wherein it was recited that the latter had supported the ward for many years last past; that the ward would be entitled to receive a part of the rents of the above-mentioned lease upon the death of the ward's father (John Dominis Holt); and that the parties had agreed that Annie Holt Kentwell would support the ward for the rest of her life. By that contract, the ward "* * * does hereby give, sell, assign, release, transfer and set over unto the said — Annie Holt Kentwell — * * * all her title and interest in and to any and all rents, issues and profits to which she may hereafter be entitled or which may be due and payable to her by, through or under the lease to the Waialua Agricultural Company, Limited * * * or by virtue of being the only child of John Dominis Holt, the elder, and devisee under the will of R. W. Holt, deceased, together with all and every her right to demand, receive, collect, and receipt for all such rents, issues and profits from whomsoever due during the term of the natural life of her the ward * * *" There was also a provision whereby Annie Holt Kentwell agreed to support the ward for the rest of the ward's life, and that the heirs of Annie Holt Kentwell should be entitled to perform the contract if the ward survived Annie Holt Kentwell. This contract was recorded on June 17, 1907, in Honolulu.

On May 2, 1910, a deed was made to James Lawrence Holt of an undivided one-third interest in the lands, subject to a deed of trust made by James Lawrence Holt to a trustee and subject to the lease hereinabove described. The deed was signed by a number of people, including the ward, her father (John Dominis Holt), and Annie Holt Kentwell.

On May 28, 1910, James Lawrence Holt and his trustee conveyed to one Castle, as trustee, an undivided two-thirds interest in the lands, which included the one-third which was conveyed by the above-mentioned deed. This conveyance was recorded on May 31, 1910. The deed signed by the ward, above mentioned, was recorded on June 23, 1910.

Castle, as trustee, on May 17, 1920, conveyed the undivided two-thirds interest to trustees of a real estate trust, the conveyance being recorded the following day. The trustees, on July 20, 1921, then conveyed the undivided two-thirds interest to the company, which conveyance was recorded on the same day.

The ward's father died on April 10, 1922, leaving the ward as his heir at law. In June, 1926, the ward was declared incompetent and Annie Holt Kentwell was appointed her guardian in England, where both parties were then residing. On February 1, 1927, a brother of the English guardian (George H. Holt, being, like his sister, one of the nine children of Owen J. Holt), was appointed guardian of the estate of the ward in Honolulu. He will hereafter be referred to as the guardian.

The guardian on May 9, 1928, filed a petition in the Circuit Court of the territory, alleging that the company's attorneys, one of whom was Castle hereinabove mentioned, induced James Lawrence Holt, who was in the confidence of Annie Holt Kentwell, who in turn completely influenced and controlled the ward, to endeavor to induce Annie Holt Kentwell to procure the ward's signature to the deed hereinabove mentioned. It was alleged that an agreement was entered into between James Lawrence Holt and Castle, as trustee for the company to that effect. Other allegations are that the negotiations were carried out; that the ward had always been, and was on the date the deed was executed by her, wholly incompetent mentally to execute a conveyance; that the conveyance purported to be for a consideration of $30,000 to the ward, but that in fact it was never received by the ward; and that the amount was "grossly, utterly, and wholly inadequate as consideration." The lease and contract, hereinabove mentioned, were not mentioned in the petition. The guardian prayed that the deed executed by the ward be canceled, and that the company be required to account for the rental value of the undivided one-third interest, purported to have been conveyed, from April 10, 1922, the date of the death of the ward's father (John Dominis Holt).

James L. Holt appeared and admitted the petition.

Thereafter, and on March 5, 1929, the guardian filed an amended petition which contained substantially the same allegation as the petition but included an allegation of the existence of the lease hereinabove mentioned; that it was executed at a time when the ward was "as at all other times herein mentioned, wholly and utterly incompetent to bind herself by executing said document"; and that neither the ward nor anyone on her behalf received any consideration for the execution of the lease. There was also an allegation that notwithstanding the facts as alleged "relief in equity against said lease need not be and cannot be herein prayed for, respondent's sole claim of right to the said lands being now based upon the said deed of May 2, 1910." In accordance therewith there was no specific prayer for relief against the lease, but there was a general prayer that the court "grant such other and further relief as to the Court may seem just and equitable, to the end that complete justice and equity may be done in the premises * * *"

Appellant replaced the guardian by stipulation dated March 12, 1929.

After trial of the cause, and on May 11, 1929, the trial court wrote an exhaustive opinion, in which it was held that the deed of a mentally incompetent person was not void, but voidable and would be set aside only when the equities so required. The court found: (1) That the ward "has never been competent mentally to execute a conveyance of property," and that "she was not competent mentally to execute the conveyance of May 2, 1910"; (2) that such incompetency was known to Annie Holt Kentwell, her husband and Jame Lawrence Holt; (3) that "the evidence does not clearly show that the (company) knew of such mental incompetency." The court held that the equities required cancellation of the deed. It entered a decree canceling the deed executed by the ward, upon return to the company of $30,000 and interest, and entered judgment in favor of the guardian for rentals less $30,000 and interest in the sum of $540,806.07.

The company appealed from the decree to the Supreme Court of the territory. That court exhaustively considered the case and held that a deed of a mentally incompetent was voidable, if the incompetency had not been judicially declared prior to the...

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  • Hernandez v. Banks
    • United States
    • D.C. Court of Appeals
    • 2 d4 Maio d4 2013
    ...Levine v. Whitney, 9 F.Supp. 161, 162 (D.R.I.1934); Christian v. Waialua Agric. Co., 31 Haw. 817, 877–79 (Haw.1931), rev'd,93 F.2d 603 (9th Cir.1937), rev'd,305 U.S. 91, 59 S.Ct. 21, 83 L.Ed. 60 (1938). But the highest court of our jurisdiction did not have that opportunity in the period be......
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    ...Company, 31 Hawaii 817; Id., 33 Hawaii 34. 2 Waialua Agricultural Company v. Christian, 52 F.2d 847. 3 Christian v. Waialua Agricultural Company et al., 9 Cir., 93 F.2d 603. 4 Matos v. Hermanos, 300 U.S. 429, 57 S.Ct. 529, 81 L.Ed. 5 'This indenture—made this 31st day of August A.D. 1906, b......
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    ...v. Des Moines Life Ins. Co., 156 Iowa 539, 543, 136 N.W. 891; 17 C.J.S., Contracts, § 418e, page 904. See also Christian v. Waialua Agr. Co., 9 Cir., 93 F.2d 603, 610, and citations; revd. on other grounds, 305 U.S. 91, 59 S.Ct. 21, 83 L.Ed. However, where the executed contract of an incomp......
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    • Hawaii Supreme Court
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    ...Agricultural Co., 31 Haw. 817 (1931) and 33 Haw. 34 (1934). The second of these Christian decisions was reversed by the Ninth Circuit, 93 F.2d 603 (1937), but on appeal was affirmed by the United States Supreme Court, 305 U.S. 91, 59 S.Ct. 21, 83 L.Ed. 60 (1938).2 Anita's status as Eliza's ......

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