Estate of Mark v. H.H. Smith Co.
| Decision Date | 07 December 1989 |
| Docket Number | No. 49S02-8912-CV-895,49S02-8912-CV-895 |
| Citation | 547 N.E.2d 796 |
| Parties | The ESTATE OF Martin H. MARK, Audrey L. Mark, Administrator Audrey L. Mark, and Michael L. Mark, Appellants, v. H.H. SMITH COMPANY and Jeffrey Mark, Appellees. |
| Court | Indiana Supreme Court |
Donn H. Wray, Stewart & Irwin, Leo L. Kriner, Indianapolis, for appellants.
Leonard Opperman, A. Demarest Allen, III, Bose McKinney & Evans, Indianapolis, for appellees.
This cause comes to us on a petition to transfer from the Second District Court of Appeals. The Estate of Martin H. Mark (Estate) appealed the trial court's decision that Jeffrey Mark gained title by adverse possession to certain real estate and that the Estate had no title, ownership, or interest in the real estate. The Court of Appeals affirmed the judgment of the trial court. 1 514 N.E.2d 351.
The facts show that in 1956, Martin Mark purchased real estate located at 325 North Illinois. During that same year, the H.H. Smith Company moved into the building at 325 North Illinois with Jeffrey Mark, Martin's brother, acting as its sole operating partner. This arrangement continued until Martin Mark's death in 1983. At the time of his death the title to the property was still in his name.
On October 24, 1983, Plaintiffs H.H. Smith Company and Jeffrey Mark filed their complaint to determine the Estate's interest in real estate and improvements to the property in question and, on January 30, 1984, moved to consolidate their claim, which was then pending in the Estate proceedings, with this cause of action. That motion was granted on February 1, 1984. Ultimately the cause was tried to the court and the trial court's decision was that Jeffrey Mark gained title to the real estate by adverse possession and that the Estate had no title, ownership, or interest in it. The Estate appealed the trial court's judgment to the Court of Appeals, claiming that the trial court failed to make findings of fact demonstrating the existence of all of the required elements for adverse possession.
The judgment, findings of fact and conclusions of law were entered by the trial court on January 8, 1986, as follows:
JUDGMENT, FINDINGS OF FACT, AND CONCLUSIONS OF LAW
H.H. Smith Company and Jeffrey Mark timely filed a claim against the Estate of The Court having concluded that the testimony of Jeffrey Mark expands the Plaintiffs' cause of action and should have been excluded under the Dead-Man's Statute, now sustains Defendants' objection to the testimony and strikes that testimony from the record, including Plaintiffs' Exhibits Six and Seven, which were admitted as part of said testimony.
Martin H. Mark, who died intestate on the 6th day of June, 1983. The claim alleged ownership of certain real estate and damages for breach of contract. H.H. Smith Company and Jeffrey Mark also filed their amended complaint to determine interest in said real estate, to which the Defendants filed their counterclaim. The cause was heard upon the evidence submitted by the parties and trial concluded on August 14, 1985. At the conclusion of the evidence, the Court took under advisement its decision and the objection of the Defendants to the testimony of Plaintiff and Claimant Jeffrey Mark.
And the Court, having considered all of the evidence and being duly advised by post trial briefs, does now decide and determine as follows:
FINDINGS OF FACT
1. That Jeffrey Mark and Martin H. Mark formed a partnership known as H.H. Smith Company; and filed a partnership certificate with the Recorder of Marion County on February 19, 1948; the purpose of said partnership was to sell barber and beauty shop equipment;
2. That, in 1956, Martin H. Mark, an attorney, purchased and took title to real estate located at 325 North Illinois Street, Indianapolis, Indiana, bearing the following legal description:
A strip of ground of the uniform width of 35 feet taken by parallel lines off the north side of Lot Number Nine (9) in Square 26 of the Donation Lands of the City of Indianapolis, County of Marion, State of Indiana;
3. That, at the time of Martin H. Mark's death on June 6, 1983, title to the disputed real estate remained in the name of Martin H. Mark;
4. That, from the time of the purchase of said real estate, all insurance on said building and all real estate taxes and depreciation on said building were taken as expenses and deductions on the partnership income tax return;
5. That the original inventory filed in this Estate on November 2, 1983, listed no real estate. But thereafter, on February 21, 1984, the Executrix of the Estate, being the widow of the decedent herein, filed a Partial Inventory, Number 2, in which the subject real estate was listed as an asset of decedent's Estate.
6. That Jeffrey Mark operated the business known as H.H. Smith Company as the sole operating partner.
7. That Martin H. Mark took no depreciation on his federal income tax returns for the business property from the date of its purchase until the date of his death, nor did said returns show any rent or income from said property;
8. That Jeffrey Mark significantly improved the property, including painting and remodeling the building when necessary;
9. That, at no time did Martin H. Mark receive income from the profits derived from the operation of H.H. Smith Company, nor did he participate in any manner in the operation of that business;
10. That, although the H.H. Smith Company filed partnership tax returns, the returns reflect no ownership interest of Martin H. Mark in the business. The partnership returns reflect one hundred per cent (100%) ownership of the H.H. Smith Company by Jeffrey Mark;
11. That Jeffrey Mark took possession of the building in 1956, and changed the locks at that time;
12. That Martin H. Mark never possessed a key to the building after the locks were changed, and thereby was denied access to the property;
13. That, Jeffrey Mark insured the property continuously since 1956;
14. That Jeffrey Mark paid all taxes assessed upon the property since 1970 15. That Jeffrey Mark held the property and operated the H.H. Smith Company upon the premises openly since 1956;
16. That Jeffrey Mark regarded himself as the owner of the property; and
17. That Martin H. Mark never brought an action against Jeffrey Mark to eject him from the property.
1. The law is with the plaintiff Jeffrey Mark on Count II of his complaint.
2. The operation of the H.H. Smith Company since 1956, constitutes an actual, visible and notorious possession of the property.
3. Jeffrey Mark has satisfied all the requirements necessary to gain title to the subject property by adverse possession, and is now entitled to legal title to the property located at 325 North Illinois Street, Indianapolis, Indiana.
4. The law is against Defendants on their counterclaim.
IT IS, THEREFORE, ORDERED, ADJUDGED AND DECREED by the Court that Plaintiff, Jeffrey Mark, is the owner of the following described real estate:
A strip of ground of the uniform width of 35 feet taken by parallel lines off the north side of Lot Number Nine (9) in square 26 of the Donation Lands of the City of Indianapolis, County of Marion, State of Indiana,
more commonly known as 325 North Illinois Street, Indianapolis, Indiana, and that the Estate of Martin H. Mark has no interest, title or ownership in the said real estate.
Cost vs. Defendants.
DATED this 8th day of January, 1986.
Marion Superior Court
Record at 158-61. Where special findings are made by the trial court, they must be sufficient to disclose a valid basis for the legal result reached in the judgment. Town of Rome City v. King (1983), Ind.App., 450 N.E.2d 72, 77; Sandoval v. Hamersley (1981), Ind.App., 419 N.E.2d 813, 816. This Court held in Miller v. Ortman (1956), 235 Ind. 641, 136 N.E.2d 17, that the purpose of special findings is to provide the parties and reviewing court with the theory upon which the dispute was resolved. This Court must accept the findings made by the trial court if they are supported by evidence of probative value and may not add to the findings by way of presumption or inference. Miller further provided:
In considering the sufficiency of the findings of fact and conclusions of law to sustain the decision, we recognize the general rule (a) that this court must accept ultimate facts as stated by the trial court if there is evidence to sustain them, and (b) that where facts necessary to sustain the issues are not found by the trial court and the findings are silent as to such facts, they are regarded as not proved. Under such circumstances the law, in effect, implies negative findings as to such issues against the party having the burden of their proof.
The Court of Appeals found that the trial court's findings 11, 12, and 16, were sufficient to support the trial court's legal conclusion that Jeffrey's possession was hostile and exclusive and affirmed the trial court.
It is our conclusion these three findings do not support the trial court's legal conclusion that Jeffrey's possession was hostile and exclusive. The findings of the trial court were contradictory to each other and in many respects were not supported by the evidence. In total, the trial court did not find all of the elements necessary to establish proof of adverse possession. For these reasons, the opinion of the Court of Appeals is vacated and the trial court is reversed.
It is well established in Indiana law that title to real estate may be defeated by adverse possession where the possession has been actual, visible, notorious, exclusive, under a claim of ownership, hostile to the true owner, and continuous for the statutory period. All of these elements must be proved. McCarty v. Sheets (1981), Ind., 423 N.E.2d 297, 298; Emberry Community Church v. Bloomington District Missionary and Church Extension Society, Inc., (1985), Ind.App., 482 N.E.2d 288, 294; Philbin v. Carr (19...
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