Davidson v. Streeter, 3629

• Decision Date: 14 August 1951
• Docket Number: No. 3629,3629
• Citation: 68 Nev. 427,234 P.2d 793
• Parties: DAVIDSON et al. v. STREETER.
• Court: Nevada Supreme Court

Page 793

234 P.2d 793

68 Nev. 427

DAVIDSON et al. v. STREETER.

No. 3629.

Supreme Court of Nevada.

Aug. 14, 1951.

Samuel Platt, Reno, for appellants.

Wm. M. Kearney, Robert Taylor Adams, Reno, for respondent.

BADT, Chief Justice.

The trial court imposed a constructive trust upon certain real property theretofore conveyed by the plaintiff to defendants, by instruments absolute in form, and ordered defendants to reconvey the same to plaintiff (subject to the rights of certain third parties), and entered judgment for plaintiff against defendants for the excess of receipts from the property over disbursements for the purchase price, taxes, insurance, repairs, upkeep, etc. The court made findings to the effect that at the time of the conveyances by the plaintiff, Davidson had orally agreed to hold the premises for her benefit, to collect the rentals, make the necessary payments under a subsisting contract of purchase, etc., all of which he had carried out; that he eventually sold the premises, and, upon plaintiff's demand for payment, repudiated his oral agreement.

Davidson (generally referred to as the appellant herein-his wife being joined because she was a cograntee) assigns fourteen errors in support of his appeal, which may however be condensed into six assignments: 1) That the evidence does not support the findings, and particularly that the court failed to apply the rule requiring clear and convincing proof of the trust; 2) that plaintiff's claim is barred by laches; 3) that it is barred by the statute of limitations; 4) that the amended complaint (with supplemental amendments thereto) is deficient in not alleging diligence on the part of plaintiff, which would have disclosed that for many years plaintiff had been claiming the property as his own; 5) that the asserted oral agreement to hold the property in trust for plaintiff was void under the statute of frauds; and 6) that the judgment does not do equity, and that innocent third party purchasers for value without notice, are not protected by the judgment.

We have concluded that the assignments of error are without merit, and that the judgment and order must be affirmed. The pertinent facts are as follows:

Although the transaction in which Mrs. Streeter conveyed her interests in the property to Davidson, the nature of which transaction is the main question in dispute here, occurred in Davidson's office in Reno in December, 1936, it becomes necessary to review matters occurring some years prior to that occasion. The particular status of the parties too becomes important. Davidson is an attorney, having been admitted to practice in California in 1913 and in Nevada in 1932, from which year until 1938 he was employed by Mr. W. M. Kearney, a Reno attorney. In the latter year he left Mr. Kearney's employ and opened offices immediately adjoining. Mrs. Streeter, a woman now of the age of seventy years, and with little if any schooling, and without experience in legal transactions and who had been for some years a client of Mr. Kearney, met Davidson about 1932 and the latter thereafter handled a number of legal matters for her over a period of years. She testifies that his work was satisfactory and that she had confidence in him and relied on him. On March 26, 1935 she signed two written agreements with Reno Realty Syndicate to purchase two parcels of land, made a down payment of $250 and entered into possession, rented rooms in the premises to tenants and expended some $1,000 in improvements. After making monthly payments in excess of some $600, she became in arrears and the Syndicate, on March 26, 1936, commenced an action to cancel her contract. Mr. Davidson, then in Mr. Kearney's office, advised her in the matter, drew an answer for her and negotiated a settlement, under which the suit was dismissed and she entered into two new contracts on July 8, 1936. The new contracts provided for a slight increase in the purchase price ($9,000, raised to $9,100) and for slightly increased monthly payments ($50, raised to $55 on the larger parcel. The smaller parcel was covered by a ten year lease with a yearly rental of $10.00 and an option to buy for $500. When Mrs. Streeter called on Mr. Davidson in December, 1936 she had made either four or five of the $55 monthly payments, amounting (with interest on the deferred payments) to either $436.42 or $544.70. Prior to the dismissal of the first cancellation suit and the negotiation of the new contracts, she had expended over $1,500 upon the property. It thus appears that she had a substantial interest in the property when she again consulted Davidson in December, 1936. On that occasion no one was present other than the parties, and their testimony as to what occurred is in direct conflict. She says she went to him for advice because the police were under the impression that she was not conducting the property properly; that she knew Davidson was friendly with the administration and asked if he could do anything to help her: '* * * he said he could do it if I would put the property in his name, that he would take care of it and handle it for me, and he would collect the rents and try to get a buyer for it, and that I didn't have anything to worry about. I had another place to go to. * * * He told me to come back in a few days and he would see what he could do, and then when I went back he had a paper for me to sign and I signed it. * * * [he said] he would take care of the rentals and keep the payments made on it, and any repairs, if necessary, and try to get a buyer for it at a good price, and * * * after the property was sold * * * he said he would settle whatever money he got; he would settle up with me. * * * I thought it was all right. He was my attorney representing me and I had confidence in him. I thought it was perfectly all right.'

Mr. Davidson on the contrary described the interview as follows: 'Mrs. Streeter talked to me about the fact that she had to get out of the premises and that she couldn't afford to carry on the payments due under the agreement for the purchase of the property and that as she owed me money, she felt it would be fair if I would take over the contract as my own, that she couldn't continue the payments and she wanted me to have it. That was the substance of it. * * * She executed the contract in December '36, and it was necessary for me to make certain improvements or spend some money on the property, and I told her--I said, 'I cannot go on without getting the absolute conveyance from you to this property, as I might have to have the title of the property from you. I may need some money for the purpose of advancing it on improvements. * * * I feel better satisfied and safer with a deed from you conveying the title to me,' and that was about six months later or seven months or so.'

For some ten years thereafter Mr. Davidson carried on. Again there is a conflict in the testimony. Davidson testified that from 1940 to 1946, inclusive, Mrs. Streeter never visited his office. Mrs. Streeter says that she saw Davidson occasionally after August, 1937; that they had discussions about rentals and how things were going; that she saw him quite often between 1937 and 1947, several times a year; that Davidson said that things were going all right, only that he had repairs to make and insurance to pay and things to keep up, but that it was rented and in good order; that in 1947 she heard that he had sold the property; that she met him in the corridor of the court house and the following took place. She said: 'I heard you sold the property, how much have I got coming? He said, 'I didn't get all the money; I sold it on contract.' The bailiff objected to us talking. * * * Mr. Davidson * * * told me to come over to his office later, and in a few days I went to his office and got an appointment with him and then I asked him why he couldn't settle with me, why did I have to wait until he got the rest of the money, and he said, 'How much do you think you have coming?' I said, 'You have all my papers' * * * I think Ten Thousand Dollars is all right.' He said, 'You are lucky if you get Two Hundred and Fifty.' I said, 'Is that your offer?' He said, 'I am not offering you anything.' I said, 'What are you doing?' He wouldn't answer * * * that was the end of that conversation.' As to the period between 1936 and 1947, she testified that Davidson never indicated to her that he claimed to own the property or any interest in it; that when she would be short of money and would ask him if he had any surplus out of the rents, he always said that he did not, that something was to be done on the premises and that he had put out money for this and that--a roof to fix, insurance to be paid, etc.

Davidson introduced his canceled checks showing his payments concerning the property over the year. Payments on the contract aggregated $11,540.19, for repairs he paid out $3,217.28, in taxes he paid $2,056.03, and in insurance premiums $318.42. Fire destroyed a part of the premises and he prosecuted an action against the insurance company resulting in a collection of $2,000, of which $1,600 was applied on the purchase contract, $300 paid for attorney fees and $100 retained by Davidson. In conjunction with Reno Realty Syndicate he prosecuted an action to quiet title to the property (to which Mrs. Streeter was not a party and in which she was not served with process), in the course of which summons was published, notice of lis pendens recorded, etc. Davidson asserts that all of these things were open and notorious, without any concealment, with the knowledge or presumptive knowledge of Mrs. Streeter, but that she never in all the ten years asserted any rights to the property.

During such period Davidson received an aggregate of rentals and proceeds of sale in the sum of $19,401.00 and had paid out according to his own figures an aggregate of $17,131.92. ¹ Certain additional facts should be noted. Davidson never had...