Frey v. Onstott

• Decision Date: 12 April 1948
• Docket Number: 40601
• Parties: Henrietta Frey, v. Loretta Onstott, Appellant
• Court: Missouri Supreme Court

210 S.W.2d 87

357 Mo. 721

Henrietta Frey, v. Loretta Onstott, Appellant

No. 40601

Supreme Court of Missouri

April 12, 1948

Appeal from Circuit Court of City of St. Louis; Hon. Joseph J Ward, Judge.

Affirmed.

John C. Kappel, Jr., and Walter S. Berkman for appellant.

(1) When an agreement is relied upon to establish a trust, it is an express trust and is void unless in writing by virtue of Missouri statute of uses and trusts. Sec. 3494, R.S. 1939; Parker v. Blakeley, 93 S.W.2d 981; Price v Kane, 112 Mo. 412, 20 S.W. 609; Rogers v Ramey, 137 Mo. 598, 39 S.W. 66; Hillman v. Allen, 145 Mo. 638, 47 S.W. 509; Crawley v. Crafton, 193 Mo. 421, 91 S.W. 1027; Ebert v. Myers, 320 Mo. 804, 9 S.W.2d 1066. (2) Implied, resulting or constructive trusts arise by operation of law and they are never the result of an express agreement. 65 C.J. 366; Ferguson v. Robinson, 258 Mo. 113, 167 S.W. 447; Parker v. Blakeley, supra. (3) Lack of consideration will not create a resulting trust unless there is evidence of fraud, mistake or undue influence. 65 C.J. 379; Parker v. Blakeley, supra. (4) The denial of the existence of an express trust or the refusal to execute same does not create a constructive trust. Ferguson v. Robinson, supra; Long v. Conrad, 42 S.W.2d 357; Parker v. Blakeley, supra; Strype v. Lewis, 180 S.W.2d 688. (5) Neither the making of a verbal agreement nor the violation thereof constitutes fraud. Parker v. Blakeley, supra. (6) To establish a lost written instrument providing for a trust in real estate, petition must set forth facts showing execution and loss of instrument and proof thereof must be clear, cogent and convincing to exclude every reasonable doubt from the chancellor's mind. Peters v. Worth, 164 Mo. 431, 64 S.W. 490.

Francis R. Stout and Richard M. Stout for respondent.

(1) This is an action to secure the equitable remedy of cancellation of a deed, not to impress a trust. 4 Pomeroy, Equity Jur. (5th Ed.), pp. 893-1081; 1 Pomeroy, Equity Jur. (5th Ed.), sec 112; Anast v. Czerwenka, 203 S.W.2d 463. (2) There was a fiduciary relationship between the parties, and defendant had the burden of proving the fairness of the transaction. She remained silent, and the deed was properly set aside for this reason alone. Fisher v. Burgeil, 382 Ill. 42, 46 N.E.2d 380; Wilkerson v. Wann, 322 Mo. 842, 16 S.W.2d 72. (3) The deed was properly set aside because plaintiff did not intend to make an absolute conveyance, and it is supported by no consideration. Cook v. Branine, 341 Mo. 273, 107 S.W.2d 28; Mentzer v. Mentzer, 325 Mo. 941, 30 S.W.2d 146. (4) The acts of defendant shown by the evidence constitute fraud and the deed is therefore void because it is the result of such fraud. Cook v. Branine, supra; Derby v. Donahue, 208 Mo. 684, 106 S.W. 632; 3 Pomeroy, Equity Jur. (5th Ed.), secs. 859, 928; 26 C. J. Fraud, sec. 39(c), p. 1109, sec. 15 (bb) p. 1073. (5) Fraud may be inferred from the facts, and need not be shown by direct evidence. Black v. Epstein, 221 Mo. 286, 120 S.W. 754; Manahan v. Manahan, 52 S.W.2d 825; Summers v. Coleman, 80 Mo. 488; Dimity v. Dimity, 62 S.W.2d 859. (6) Lack of consideration is, of itself, evidence of fraud, and when coupled with the facts here, raises a strong imputation of fraud, throwing the burden of proving freedom from fraud on defendant. Derby v. Donahue, supra; Mangold v. Bacon, 237 Mo. 496, 141 S.W. 650; 3 Pomeroy, Equity Jur. (5th Ed.), sec. 928, pp. 640-641. (7) The deed should be set aside for mistake on the part of the plaintiff at the time of its execution, especially since the defendant helped perpetuate plaintiff's mistakes. 3 Pomeroy's Equity Jur. (5th Ed.), sec. 859; Jackson v. Miller, 288 Mo. 232, 232 S.W. 104; Sampson v. Pierce, 33 S.W.2d 1039; Sanford v. Van Pelt, 314 Mo. 175, 282 S.W. 1022. (8) Even if the statute of frauds were applicable here, it has been satisfied by proof of a lost written instrument. (9) There has been part performance of the agreement sufficient to satisfy the statute of frauds. Jones v. Jones, 333 Mo. 478, 63 S.W. 20; 2 Williston on Contracts (8th Ed.), secs. 491, 494, pp. 1413, 1430. (10) A court of equity will not allow the statute of frauds to be used as an instrument to commit fraud. 3 Pomeroy, Equity Jur. (5th Ed.), sec. 921; Strype v. Lewis, 352 Mo. 1004, 180 S.W.2d 688; Restatement of The Law of Trusts, sec. 55; 3 Bogert, Trusts & Trustees, sec. 495, p. 1585; 4 Pomeroy, Equity Jur. (5th Ed.), sec. 1055, p. 131.

Dalton, C. Bradley and Van Osdol, CC., concur.

OPINION

DALTON

Action in equity to determine title to described real estate in the City of St. Louis and for other relief, with a cross action for the value of services, et certera, in the event that equitable relief was granted to plaintiff. Equitable relief was granted, but defendant's counterclaim was denied. Defendant has appealed.

In view of the issues presented, a careful review of the pleadings and evidence is required. Respondent (plaintiff) prayed the court (1) to quiet and determine title to described real estate; (2) to declare null and void an alleged warranty deed executed by respondent, dated October 7, 1942, which purported to convey the described property to appellant; (3) to require an accounting by appellant of all rents collected; and (4) to enjoin appellant from claiming any right, title or interest in the described property.

Respondent alleged that she was the owner of the described property; that she had executed and recorded the deed purporting to convey fee simple title to appellant, but that the deed was void for specified reasons; and that appellant claimed thereunder the right to collect and receive rents, and had refused to return the property to appellant by executing a proper conveyance. Respondent charged (1) that the deed was void because made without any consideration; (2) that it was made without any intention to convey the absolute title in fee, or any other actual ownership to appellant; and (3) that it was obtained by fraud and an abuse of an alleged confidential relationship existing between respondent and appellant, which relationship appellant had invited and accepted. The alleged lack of intention to convey an absolute title in fee was based upon the alleged fact that appellant had agreed and promised (at the time of the delivery of said deed) to reconvey the property on demand and respondent had relied upon the promise.

Appellant admitted the deed had been executed, but alleged that it was made by respondent with a full knowledge and understanding of what she was doing. Appellant denied the alleged want of consideration, the agreement to reconvey on demand and the fiduciary relationship and fraud. Appellant alleged (1) that the deed was executed for a valid consideration, towit, in consideration of an existing $ 2,000 indebtedness due from respondent to appellant and in consideration of future board and lodging which respondent desired to receive of appellant; and (2) that, if any agreement was made to reconvey, it was not in writing and was unenforceable because within the statute of frauds. (Sec. 3494 R.S. 1939).

For her cross action, appellant alleged that she had performed certain services, et cetera, for respondent for which she (appellant) was entitled to compensation in the sum of $ 3840.00, less certain rents collected. Appellant asked that, in the event the court found the conveyance of the described property was made "without intention to convey the absolute title in fee or actual ownership thereof to defendant," appellant be awarded judgment against respondent for $ 3750.40.

The evidence shows that respondent met appellant in 1934 and they became and remained very close personal friends. Respondent had been a nurse. She discontinued that occupation in 1938, acquired the described property, a two story two apartment flat, and moved into one of the apartments. She had not previously owned any real estate. Respondent's nearest relatives were two nieces with whom she had had little or no contact in recent years.

Apparently respondent had a faculty for getting into difficulties and, on several occasions, she had had to secure the services and advice of an attorney. One of these difficulties involved the purchase of a chicken farm and another a dispute with a tenant. Appellant visited respondent often and sometimes accompanied respondent to the attorney's office. Respondent at no time consulted appellant about her investments, contracts or other business transactions. About 1940, some real estate man came to see respondent and wanted to buy her property. She signed a listing card of some kind. She thought the price was good at the time, but later decided she didn't want to sell. Further, she felt she had been tricked into signing the card and she consulted a lawyer and he got her out of the difficulty.

The present difficulty grows out of the execution of a warranty deed purporting to convey the property to appellant on October 7, 1942. At that time respondent was about 70 years of age and appellant was some 32 years younger. The property was worth around $ 14,000. Respondent testified: "Well, I got nervous because I had signed a card with O'Rourke and I heard that I had signed my rights away. . . . I was getting old and I didn't know just what to do. . . . I was kind of afraid of myself. . . . Well, I thought she (appellant) was a faithful friend, and I asked her to take it over because I didn't feel quite sure of myself any more, and she faithfully promised to return it, whenever I was ready. She said she would go right down to the court house and turn it back, as a faithful friend. . . . I asked her to (take it over) because I thought I was too old to sign anything else. . . . I was just trying to keep my property."

Respondent...