Fix v. Fix, 75025

• Decision Date: 23 February 1993
• Docket Number: No. 75025,75025
• Citation: 847 S.W.2d 762
• Parties: Frank F. FIX, et al., Respondents, v. Wilhelmina (Billie) T. FIX, et al., Appellants.
• Court: Missouri Supreme Court

Page 762

847 S.W.2d 762

Frank F. FIX, et al., Respondents, v. Wilhelmina (Billie) T. FIX, et al., Appellants.

No. 75025.

Supreme Court of Missouri,

En Banc.

Feb. 23, 1993.

G. Edwin Proctor, Jr., Kansas City, for appellants.

Michael Paul Harris, St. Joseph, for respondents.

COVINGTON, Judge.

Wilhelmina (Billie) Fix appeals from the trial court's judgment imposing a constructive trust on money held in a joint savings account and a joint checking account in the names of Billie and her deceased sister, Catherine Liggett. The court found that Billie enjoyed a confidential relationship with Catherine with the understanding that Billie would divide the money equally among herself and her brothers, Frank, Nicholas, and John, after Catherine's death. The Missouri Court of Appeals, Western District, reversed the trial court. This Court granted transfer of the case to examine the issue of admissibility of certain evidence in view of the 1985 amendment to § 491.010, RSMo 1986, which abolished the disqualification of interested witnesses in civil actions where one party is dead or incompetent and the adverse party testifies with respect to the contract, transaction, or cause of action. Id. That issue need not be addressed because, even if the evidence at issue is admitted, there is insufficient evidence to allow imposition of a constructive trust. Reversed and remanded.

Catherine died testate in May of 1986 in St. Joseph. Catherine executed her will in July of 1985. Billie, a resident of Florida, traveled to St. Joseph for Catherine's funeral. She and her brothers made the funeral arrangements. After the funeral, Billie and Frank went to the American National Bank in St. Joseph to examine the contents of Catherine's safe deposit box, of which Billie was a joint owner. The box contained Catherine's last will and testament, ¹ along with two $5,000 certificates of deposit (CD's) in the name of Frank and Catherine; three $5,000 CD's in the name of Catherine and John; two $5,000 CD's in the name of Catherine and Nicholas; and four CD's in the total amount of $40,000 in the names of Catherine and Billie. The box also contained a savings account book and a checking account book, both in the names of Catherine and Billie, as per Catherine's designation on the accounts in 1964. The total amount of money in the accounts at the time of Catherine's death was $132,181.03, contributed solely by Catherine. From these accounts, Billie gave her brother Frank $20,000 to pay the decedent's funeral expenses, bills, personal income taxes, and certain specific monetary bequests to nephews set forth in the decedent's last will and testament. After Frank paid the expenses and bequests, there remained $6,150.79. In addition to the personal property in the safe deposit box, Catherine designated Billie as a joint tenant with right of survivorship on the deed to her real estate. Catherine also designated Billie as a beneficiary on a $1700 life insurance policy. Only the savings and checking accounts in the joint names of Catherine and Billie are at issue.

Frank and Nicholas filed suit against Billie alleging that Catherine had told them that the joint savings accounts were to be divided equally among all of the surviving siblings; they alleged that clause eight in Catherine's will set out her intent in this regard. They alleged that Billie was aware of Catherine's intent and wrongfully converted the monies to her own use. The brothers sought judgment against Billie in the amount of "twenty-five percent each" of the balance of the account. In the alternative, the brothers asked the court to establish a constructive trust over the funds and distribute the funds equally among the siblings. Billie filed a counterclaim seeking return of the $6,150.79 balance of the $20,000 she gave Frank to pay the expenses.

At trial, the court admitted over Billie's objection testimony of Frank Fix, his wife, Mary, and their daughter, Mary, with respect to the decedent's alleged statements regarding Catherine's expectation of distribution of funds in the savings and checking accounts to the brothers, as well as to Billie. Billie denied the brothers' contentions. Billie testified that Catherine and she had placed the other's names not only on bank accounts but also on real estate deeds so that the other would be taken care of.

After the conclusion of the trial, the court entered an interlocutory order. The court ruled that the issue of constructive fraud was tried by agreement and treated as if raised in the pleadings, pursuant to Rule 55.33(b). The court also found that a fiduciary relationship existed between Catherine and Billie, Billie having promised to divide the funds in the joint accounts equally with the brothers upon Catherine's death. The court found that Billie breached the promise and was thereby unjustly enriched. The court found that Billie's actions constituted constructive fraud and imposed a constructive trust upon the disputed funds, including the $6,150.79 held by Frank. The court later entered judgment against Billie in the amount of the principal with statutory and bank interest.

Although this Court granted transfer to decide the effect of the 1985 amendment to § 491.010 in the present case with respect to Billie's claim that the alleged statements of the decedent were inadmissible through the testimony of Frank and Mary Fix, it is unnecessary, thus inappropriate, to resolve that question. As Billie alleges in her first point relied on, the evidence is insufficient to allow imposition of a constructive trust.

Billie alleges that the trial court erroneously imposed a constructive trust because the evidence did not meet the level of proof necessary for imposing a constructive trust. To establish a constructive trust, an extraordinary degree of proof is required. The evidence must be unquestionable in character. The evidence must be so clear, cogent, and convincing as to exclude every reasonable doubt in the mind of the trial court. Suhre v. Busch, 343 Mo. 679, 123 S.W.2d 8, 19 (1938). Review is governed by Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976).

The analysis commences with emphasis upon the fact that it is undisputed that Billie and Catherine were joint tenants with right of survivorship on the accounts, as designated by Catherine in 1964 at the inception of the accounts. Ownership of the accounts therefore vests in Billie as a survivor, absent evidence of fraud, undue influence, mental incapacity, or mistake. In re Estate of LaGarce, 487 S.W.2d 493, 500-01 (Mo. banc 1972); § 362.470, RSMo 1986. ² There is no suggestion in the present case of Billie's having undue influence over Catherine, nor is there suggestion of mistake or mental incapacity. The issue is whether there is constructive fraud.

To establish constructive fraud, it is necessary only to prove the acts of fraud. See Barrie v. United Ry. Co., 138 Mo.App. 557, 119 S.W. 1020, 1050 (1909). A constructive trust is a method by which a court exercises its equitable powers to "remedy a situation where a party has been wrongfully deprived of some right, title, benefit or interest in property as a result of fraud or in violation of confidence or faith reposed in another." Schultz v. Schultz, 637 S.W.2d 1, 4 (Mo. banc 1982); see also Suhre v. Busch, 123 S.W.2d at 15. Either actual or constructive fraud is sufficient to support imposition of a constructive trust. Swon v. Huddleston, 282 S.W.2d 18, 25 (Mo.1955). The object of the constructive trust is to restore to the rightful owner the property wrongfully withheld by the defendant. March v. Gerstenschlager, 436 S.W.2d 6, 8 (Mo.1969).

Proof of constructive fraud depends necessarily upon the actual circumstances of each case. Swon v. Huddleston, 282 S.W.2d at 26. Courts have equated constructive fraud with the breach or violation of a fiduciary, or confidential, relationship. Id. at 25. A confidential, or fiduciary, relationship exists in the context of the law of constructive trusts when a special confidence is reposed in one party and there is resulting domination of or influence on the other party. See e.g. Matlock v. Matlock, 815 S.W.2d 110, 115 (Mo.App.1991). A confidential, or fiduciary, relationship is not proven merely by a showing that the persons have ties of blood or family. Misskelly v. Rogers, 721 S.W.2d 170, 172 (Mo.App.1986). Family and blood ties are factors to be considered in determining whether such a relationship exists. Harlan v. Bishoff, 649 S.W.2d 230, 233 (Mo.App.1983). Under Missouri law, the primary question is whether one family member has dominion over the other family member in regard to the transaction involved. See Misskelly, 721 S.W.2d at 172. There is no claim in this case that Billie exerted dominion or influence over Catherine, nor is there any evidence to support such a claim. A confidential, or fiduciary, relationship did not exist between Catherine and Billie.

A bench tried judgment that reaches a correct result, however, will not be set aside even if the trial court gives a wrong or insufficient reason for its judgment. Edgar v. Fitzpatrick, 377 S.W.2d 314, 318 (Mo. banc 1964). A finding of a fiduciary, or confidential, relationship is not always a prerequisite to a finding of constructive fraud for the purpose of imposing a constructive trust. There are numerous other circumstances in which Missouri courts have imposed a constructive trust. Closest to the present case are the cases that impose a constructive trust over property bequeathed or devised by will when a testator makes disposition of property in reliance on the beneficiary's promise, express or implicit, to convey the property to a third person, and the beneficiary breaches the agreement.

In Soehngen v. Jantzen, 186 S.W. 1109 (Mo.App.1916), the court imposed a constructive trust on property of a husband who admitted that he had promised his wife that he would sell land she bequeathed to him in her will and give...