Ferguson v. Olmsted

• Court: Colorado Supreme Court
• Citation: Ferguson v. Olmsted, 451 P.2d 746, 168 Colo. 374 (Colo. 1969)
• Decision Date: 17 March 1969
• Docket Number: No. 22291,22291
• Parties: David FERGUSON, Plaintiff in Error, v. Charles D. OLMSTED, Executor of Estate of Marguerite M. Ferguson, Deceased, Defendant in Error.

Page 746

451 P.2d 746

168 Colo. 374

David FERGUSON, Plaintiff in Error, v. Charles D. OLMSTED, Executor of Estate of Marguerite M Ferguson, Deceased, Defendant in Error.

No. 22291.

Supreme Court of Colorado, In Department.

March 17, 1969.

Philip A. Rouse and Raymond J. Turner, Denver, for plaintiff in error.

Zarlengo, Zarlengo, Seavy & Mulligan, V. C. Seavy, Jr., Denver, for defendant in error.

MOORE ^*, Justice.

We will refer to the parties by name of as they appeared in the trial court where David Ferguson was plaintiff and Charles D. Olmstead as executor of the Estate of Marguerite M. Ferguson was defendant.

For a complete understanding of the controversy now presented for determination, we direct attention to the opinion of this court in Olmstead v. District Court, 157 Colo. 326, 403 P.2d 442. In that case this court held that Robert P. Fullerton, who purported to rule upon David Ferguson's Motion for Relief from Judgment or Order at a time when his term of office as a judge of the district court had expired, had no authority to hear and determine that motion and his ruling therefore was a nullity. Thereafter the motion of Ferguson was resubmitted to the district court and all the relief prayed for by Ferguson was denied.

In a divorce action filed by plaintiff against his wife Marguerite, a decree of divorce was entered in his favor on September 3, 1963. Matters pertaining to division of property, alimony and support money for children were reserved for further hearing. On April 16, 1964, the Honorable Robert P. Fullerton, then a judge of the district court, entered an order captioned 'Property Settlement, Support, and Alimony Decree.' This decree contained provisions for alimony, support money and payment of debts, which are not material at this time.

With respect to the matters now material, the April 16, 1964, decree provided that:

'4. The Plaintiff shall pay to the defendant the sum of forty-five thousand dollars ($45,000.00) within five months from the date of this Decree, as her full share of the property settlement ordered by this Court.

'5. The house which is presently in the name of the defendant shall be sold under the direction of the plaintiff, and the net proceeds divided equally between the parties. It is contemplated that approximately twenty thousand dollars ($20,000.00) will be received as net proceeds from the sale of this property, one-half to be the property of the plaintiff, and the other half to be the property of the defendant.

'6. The proceeds from the house sale awarded to the defendant, and the forty-five thousand dollars ordered to be paid to the defendant in No. 4 above, shall be placed in trust for the benefit of the defendant.

'Mr. Zarlengo and Mr. Seavy shall prepare a Trust instrument which shall have as its corpus this property. The Defendant shall be one of the Trustees, and the Co-Trustee shall be any one of the following banks of the Defendant's choosing: First National Bank of Denver, the Denver U. S. National Bank, the Colorado National Bank, or the Central Bank and Trust Company.

'The Defendant shall receive monthly income from the Trust as income accrues. The Corporate Trustee shall invest the corpus with the objective of high income yield rather than growth.

'The Co-Trustees, by joint agreement, shall have the power to invade the corpus for defendant's health, maintenance, and support.

'This Trust shall terminate upon the remarriage of the defendant, or in the event the Corporate Trustee believes defendant's best interests would be served by termination. Upon termination the corpus and undistributed income shall be delivered to the defendant. In the event of the defendant's death prior to termination, the corpus and undistributed income shall become a part of the defendant's estate.'

This decree became final on April 16, 1964, and no appellate proceedings were ever directed thereto.

On September 5, 1964, the divorced wife died, and four days thereafter plaintiff filed the aforementioned Motion for Relief from Judgment or Order. He also filed a motion for new trial on the ground of newly discovered evidence, and a motion for custody of the two minor children originally awarded to Mrs. Ferguson. The motion for change of custody was granted on December 7, 1964.

The motion for relief from the judgment entered on division of property was based on the provisions of R.C.P.Colo. 60(b), which provides that the court may relieve a party from a final judgment for the reason, among others, that,

'* * * it is no longer equitable that the judgment should have prospective application; or (5) any other reason justifying relief from the operation of the judgment.'

The thrust of plaintiff's motion is that at the time it was filed,

'The trust ordered by the court had not been created; payment into the trust had not been made; sale of the house had not been accomplished; and the time for accomplishing such pursuant to the decree had not expired. These were the things still to be accomplished which were prospective in their application.'

It is also argued that the trial court was without jurisdiction to order the plaintiff to maintain or replace insurance policies in which his children or his wife were named beneficiaries; and that the court acted without jurisdiction in ordering plaintiff to pay $45,000 for creation of a trust fund.

Prior to the date of the hearing on plaintiff's motion, briefs were filed and plaintiff's attorney asserted that the evidence which he intended to offer would show:

'1. The persons who are to be effected (sic) by any further order of Court are the plaintiff and his four minor children.

'2. The plaintiff's ability to continue his position as president of the Boulevard National Bank will be jeopardized if the original Order were enforced.

'3. The plaintiff's experience in banking and investments and his position as president of Boulevard National Bank and as father of the four minor children overwhelmingly qualify him to handle and invest his own money for the benefit of his own children as opposed to a great aunt who is a resident of California serving as trustee of a New Mexico trust derived from a New Mexico probate of the plaintiff's money originating in the trust created by this Court.

'4. The plaintiff's ability to maintain the children as well as to conduct his own affairs will be materially reduced not only by the payment required to create the trust but also by very severe tax liability which will result from the sale of capital assets to produce the funds necessary.

'5. The funds available through the plaintiff to support the minor children of the parties will be materially reduced, if the trust is continued,...