Farrar v. Young, s. 13634

• Decision Date: 23 November 1976
• Docket Number: 13635,Nos. 13634,s. 13634
• Parties: Robert E. FARRAR, Administrator, etc., et al. v. Mildred YOUNG, Administratrix, etc. Mildred YOUNG, Administratrix, etc. v. Robert E. FARRAR, Administrator, etc., et al.
• Court: West Virginia Supreme Court

Page 261

230 S.E.2d 261

159 W.Va. 853

Robert E. FARRAR, Administrator, etc., et al. v. Mildred YOUNG, Administratrix, etc.

Mildred YOUNG, Administratrix, etc. v. Robert E. FARRAR, Administrator, etc., et al.

Nos. 13634, 13635.

Supreme Court of Appeals of West Virginia.

Nov. 23, 1976.

Syllabus by the Court

1. The provisions of a written agreement are binding upon the parties thereto and the fact that such agreement was not recorded does not relieve said parties of their obligations thereunder.

2. A grantee in a deed to whom a conveyance of land was made with a covenant of general warranty and free of all liens and encumbrances is not afforded protection by the recording statute, W.Va. Code, 1931, 40--1--9, as amended, against an encumbrance on the conveyed property created under the terms of a written agreement previously entered into between said grantee and his grantor.

3. 'Code, 1931, 31A--4--33 as amended, creates, in the absence of fraud, mistake or other equally serious fault, a conclusive presumption that the donor depositor of a joint and survivorship bank account intended a causa mortis gift of the proceeds remaining in the account after his death to the surviving joint tenant.' Point 2, Syllabus, Dorsey v. Short, W.Va., 205 S.E.2d 687 (1974).

4. 'In the absence of a valid contract of employment an allowance of fees to an attorney, payable out of the estate of a decedent, can only be justified upon a showing of services beneficial to the estate, or necessary to its settlement, as distinguished from services performed for a client presenting a claim against the estate.' Syllabus, Beuter v. Beuter, 122 W.Va. 103, 7 S.E.2d 505 (1940).

Billy E. Burkett and Randall L. Veneri, Princeton, for Farrar, et al.

John P. Anderson, Princeton, for Mildred Young.

CAPLAN, Justice.

This case, on appeal from a final order of the Circuit Court of Mercer County entered on February 10, 1975, involves a civil action instituted in that court by Mildred Young, in her individual capacity and as Administratrix of the Estate of R. S. Farrar, deceased, against Robert E. Farrar, Administrator of the Estate of R. S. Farrar and in his individual capacity and Charles E. Farrar. After a trial before the court without a jury, the court made certain findings and entered an order, part of which favored the plaintiff and part of which was favorable to the defendants. Both the plaintiff and the defendants appeal.

Mildred Young, Robert E. Farrar and Charles E. Farrar are the children of R. S Farrar who died intestate on July 26, 1972. The settlement of his estate resulted in this family squabble, prompting this litigation and these appeals.

In her civil action Mildred Young sought an accounting and a recovery of monies paid by Mercer Crushed Stone, Inc. to her brothers. Mercer Crushed Stone operated a quarry on the Farrar lands under a lease with the Farrar brothers. That corporation is not a party to this appeal but it did answer the complaint, therein acknowledging the existence of the lease and its performance thereunder.

Reflecting the position of the plaintiff are the following allegations in her complaint. She asserts that under the terms of an agreement dated April 22, 1965, she and her brothers, in consideration of the conveyance of certain lands, agreed to make certain royalty payments to their father, R. S. Farrar, for the removal of rock, limestone and other minerals from lands owned by said R. S. Farrar. That agreement is contained in the record as an exhibit, the pertinent part of which reads as follows:

4. In the event any of the Minerals, limestone, rocks, coal, oil or Gas are removed and/or sold off of the above described farm during the lifetime of the said R. S. Farrar, the proceeds of the sale of said minerals, limestone, etc. shall be divided as follows:

(a) The first Ten Thousand ($10,000.00) Dollars received from such sales, in any one year, shall be paid to the said R. S. Farrar, and all money in excess of $10,000.00, in any one year, shall be divided equally between R. S. Farrar, Charles E. Farrar, Robert E. Farrar and Mildred Farrar Young.

(b) On the death of the said R. S. Farrar, the proceeds from the sale of said minerals shall be divided equally between Charles E. Farrar, Robert E. Farrar and Mildred Farrar Young, their heirs or assigns.

The plaintiff notes in her complaint that R. S. Farrar, on February 8, 1969, executed in favor of his sons, C. E. Farrar and R. E. Farrar, a release of certain conditions contained in the aforesaid agreement but specifically retained and excluded from that release the above quoted royalty payment clause, designated 4(a).

It is further asserted by the plaintiff that no royalty payments provided for in the above agreement were made by her brothers to R. S. Farrar during his lifetime; that she has no knowledge as to when Mercer Crushed Stone commenced operation of the quarry; and that she has requested an accounting of the operation from her brothers and from the operator of the quarry but has received no information from either of them. Expressing her belief that royalty payments are due and owing the estate of R. S. Farrar, she demands that Robert E. Farrar or Charles E. Farrar or both and Mercer Crushed Stone, Inc. be required to make an accounting of all the monies paid by the latter to her brothers under the lease and that all monies due R. S. Farrar under the agreement of April 22, 1965 be paid to the estate. She also seeks recovery of attorneys fees.

Responding to the complaint, Robert E. Farrar and Charles E. Farrar filed an answer and counterclaim. In their answer, the defendants, while admitting the existence of the April 22, 1965 agreement, deny that R. S. Farrar was the owner, taking the position that he owned only a one-third undivided interest in such property. Furthermore, they deny that the release executed by R. S. Farrar, alluded to in the complaint, was valid or effective, since they did not sign it.

In addition, answer the defendants, two certain deeds, dated May 12, 1965, wherein Robert E. Farrar and Charles E. Farrar were each a grantee of the subject real estate, which deeds conveyed to the defendants 'with covenant of General Warranty of Title and free of all liens and encumbrances', superceded and nullified the agreement of April 22, 1965. They took the position, therefore, that neither the plaintiff nor R. S. Farrar was entitled to any royalty payments nor to the demanded accounting.

In their counterclaim the defendants allege that in July, 1970 R. S. Farrar became incapacitated and went to live with the plaintiff where he resided until his death on July 26, 1972. They assert that at the 'instance and demand' of the plaintiff, R. S. Farrar closed out his chekcing and savings account at the Princeton Bank & Trust Company and opened other checking and savings accounts in other banks jointly with the plaintiff, 'so that all the money in those accounts went to the Plaintiff on his death.' They further allege that a substantial number of shares of stock in the Princeton Bank & Trust Company were given to the plaintiff by her father, R. S. Farrar; that a considerable amount of real and personal property of R. S. Farrar was sold, the proceeds thereof remaining unaccounted for; that the sum of $2,600.00 received by her father in social security payments has not been accounted for; that she had received an advance of $1,000.00 which should be deducted from her share of the subject estate; that R. S. Farrar was mentally incompetent during the period in which he resided in his daughter's home; and, that, although they had requested an accounting of these various funds no such accounting was ever made.

Based upon its findings of fact and conclusions of law, after lengthy hearings, the court, by its order dated February 10, 1975, adjudged and decreed that: (1) The agreement of April 22, 1965, entered into between R. S. Farrar and his children, R. E. Farrar, C. E. Farrar and Mildred Young, is enforceable and binding with respect to the royalty clauses contained in Paragraphs 4(a) and 4(b) thereof, such payments to be subject to reasonable and necessary expenses; (2) that Mercer Crushed Stone, Inc. make an accounting of all royalty payments made to or on behalf of the plaintiff's brothers from the date of the commencement of the payment of royalties until the date of the death of R. S. Farrar and the amounts so reported shall be made a part of and included in the estate of R. S. Farrar; also, the defendants shall place in escrow, pending the final disposition of this proceeding, an amount equal to one-third of the royalty payments received by them from Mercer after the death of their father; (3) the $1,000.00 advance made by R. S. Farrar to Mildred Young shall be considered as a $1,000.00 advance against the plaintiff's share of said estate; (4) the balance in the savings account in the joint names of R. S. Farrar or Mildred Young, in the amount of $4,798.05, at the Bank of Tazewell shall be included in the R. S. Farrar estate; (5) R. S. Farrar was not incompetent at any time prior to his death and all of his transactions referred to in this order are valid and shall not be set aside; and (6) neither party to this proceeding shall be permitted to charge or claim attorney's fees against the R. S. Farrar estate.

The plaintiff and defendants filed objections to the order of the court, such objections giving rise to the following questions on this appeal. (1) Whether the court erred in holding that the agreement dated April 22, 1965 was enforceable and binding with respect to the royalty clauses contained in Paragraphs 4(a) and 4(b) thereof; (2) whether the court erred in holding that the joint savings account shall be included in the R. S. Farrar estate; (3) whether the court erred in denying payment of attorneys' fees from the estate; and, (4) whether the court erred in its allowance of expenses to the defendants.

In arriving at a decision...