Gaines Bros. Co. v. Gaines, Case Number: 26104

• Decision Date: 04 February 1936
• Docket Number: Case Number: 26104
• Citation: 176 Okla. 576,1936 OK 112,56 P.2d 869
• Parties: GAINES BROS. CO. et al. v. GAINES.
• Court: Oklahoma Supreme Court

1936 OK 112

56 P.2d 869

176 Okla. 576

GAINES BROS. CO. et al. v. GAINES.

Case Number: 26104

Supreme Court of Oklahoma

Decided: February 4, 1936

Syllabus

¶0 1. DEEDS - Presumption That Fee-Simple Estate Granted Overcome Only by Preponderance of Evidence.

Under section 5272, C. S. 1921 (sec. 9698, Okla. St. 1931), every estate in land which shall be granted, conveyed, or demised by deed or will shall be deemed an estate in fee simple and of inheritance, unless limited by express words, and to overcome this presumption the party contesting it must make out his case by preponderance of the evidence.

2. EVIDENCE - Burden on Defendant to Prove Allegations of Answer Setting up Affirmative Defense Denied by Plaintiff.

Where a defendant sets up an affirmative defense, and the plaintiff denies the existence of the same, the burden of proof is upon the defendant to prove the allegations of his answer.

3. TRUSTS - Burden of Proof to Establish Resulting Trust - Parol Evidence.

A resulting trust may be established by parol evidence, but the law requires that the proof necessary to establish it should be of the most satisfactory kind. The onus of establishing a resulting trust rests upon him who seeks its enforcement, and before a court of equity will be warranted in making a decree therefor, the evidence must be clear, unequivocal, and decisive.

4. WITNESSES - Competency of Agent of Decedent to Testify as to Transactions Had With Him.

As a general rule, the agent of a decedent is not so identified with his principal that a transaction with him, or communication to him, is equivalent to a personal transaction or communication with his principal, within the meaning of the statute prohibiting a party to or person interested in the event of a suit against the estate of a deceased from testifying to a personal transaction had with the latter.

5. SAME - Statutes Excluding Persons From Testifying Strictly Construed in Favor of Witness.

Statutes which exclude persons from testifying will be strictly construed in favor of the witness. Classes of persons not named in the statute will not be excluded by implication, even though the reason therefor may seem as strong as those which apply to the persons expressly designated.

6. SAME - Incompetency of Witness Waived by Examination of Witness by Objecting Party.

A party to litigation, who elicits information concerning transactions or communications with a deceased person from a witness incompetent to testify as to the same, cannot thereafter successfully object to his adversary pursuing the same line of inquiry on cross-examination or redirect examination of the same witness.

Appeal from District Court, Ottawa County; Dennis H. Wilson, Judge.

Action by Frank Gaines against the Gaines Brothers Company et al., wherein defendants filed a cross-complaint. Judgment for plaintiff, and defendants appeal. Affirmed.

Vern E. Thompson and Loyd E. Roberts, for plaintiffs in error.

M.W. Hinch and Frank Nesbitt, for defendant in error.

PER CURIAM.

¶1 For convenience parties will be referred to as in the lower court. The plaintiff instituted this action for ejectment of the defendants from certain lands and quieting plaintiff's title therein. The plaintiff alleges that he was the owner of certain tracts of land, and attached as exhibits copies of warranty deeds to each and all of said tracts of land, and alleging that the defendants were in possession of the same, and that said possession was without right and unfounded, and that the claim of the defendants constitutes a cloud on plaintiff's title, and prays to have the same removed and title forever quieted in plaintiff.

¶2 The defendants filed an answer and cross-complaint. In addition to a general denial, it is admitted that the defendants were in possession of the property as alleged and described in plaintiff's petition. It is further claimed that the defendant, Gaines Brothers Company, a corporation, had quit-claimed all of its interests in and to the property to the individual defendants, including the plaintiff herein. The answer admits that the plaintiff is the holder of the record title to all of the property described in his petition, and further alleges that the defendant corporation had always had the uninterrupted and peaceful use and possession of all of said property; that the plaintiff had never had any beneficial title in said property, but acquired each and every tract thereof for the use and benefit of the defendant, Gaines Brothers Company, a corporation, its creditors and assigns; that the plaintiff was holding the same in trust for said corporation, and that by asserting ownership therein, he was attempting to convert said property to his own use and benefit in violation of his trust, and that said trust should be, by the court, ended and determined in this action. Defendants pray that plaintiff's petition be dismissed, and that Josie Gaines, Walter Gaines, Frank L. Gaines, W.H. Gaines, Earl E. Gaines, Mayme Gaines Powell, and Ralph E. Gaines be declared to be the beneficial owners of an undivided interest in said property as set out in their answer, and that plaintiff be required to execute to said defendants suitable conveyances to their undivided interest, and that he be decreed to have no further interest in the undivided interest claimed by the individual defendants.

¶3 To the answer and cross-complaint the plaintiff filed a reply in the nature of a general denial.

¶4 When the case was called for trial the court ruled that under the pleadings the burden of proof was on the defendants as legal title in the plaintiff was admitted. The defendants objected and excepted to this ruling. There is not very much conflict in the testimony.

¶5 It appears from the evidence adduced that two brothers, James Henry Gaines and Frank Gaines, first began their business relations as partners engaged in stock raising, farming, etc., and on the 20th day of June, 1907, the two brothers organized a corporation and all of their property was transferred to this corporation. Their interest in the corporation was practically equal with four shares assigned to Walter Gaines so as to have three incorporators, consisting of James Henry Gaines, Frank Gaines and Walter Gaines. Before the organization of the corporation the two brothers kept a joint bank account, against which they drew such checks as they desired for the operation of the partnership and for their own individual needs. After the corporation was organized and a charter issued, these two brothers proceeded in the same manner, using the funds of the corporation in such amounts as their individual needs required and no record was kept of any withdrawals by either brother. This relationship continued without friction until the death of James Henry Gaines in March, 1914. One of the sons of James Henry Gaines was elected a director soon after his father's death and the business was carried on along the same lines as theretofore with the plaintiff and the heirs of his brother drawing checks against the bank account of the corporation to meet their individual needs, without much, if any, record being kept thereof. The corporation was operated as a family affair, and all was harmonious until about the year 1930, when friction developed as to the exact interest of the two brothers in said corporation. From the organization of this corporation in 1907 until about 1929, there had never been a formal meeting of its board of directors, except the one meeting at the death of James Henry Gaines, when his son, W.H. Gaines, was made one of the directors of the corporation to take his father's place. There were no formal dividends declared during this time. The plaintiff from time to time withdrew funds from the corporation for his individual needs and the widow and children of James Henry Gaines did likewise, which included payment of household expense, the education of their children, building of homes, etc. No objection was registered by any of the parties to this action and manner of handling the business, for more than 15 years after the death of James Henry Gaines.

¶6 Beginning with 1910 up to the death of James Henry Gaines the plaintiff withdrew funds from the corporation and purchased ten tracts of land. After the death of his brother, the plaintiff, on the 6th day of November, 1914, and again on March 12, 1920, and on June 3, 1922, withdrew funds from the corporation with which he acquired three additional tracts of land, all of which is the subject of this action. The funds withdrawn by Frank Gaines with which to purchase the lands in question amounted in the aggregate to approximately $20,000. Prior to his death, the brother, James Henry Gaines, had withdrawn funds from the corporation in like manner as the plaintiff herein and acquired lands in his own name for which he paid with said funds, amounting in the aggregate to about $40,000. Upon the death of James Henry Gaines his estate was probated and all the lands he had acquired, in his individual name were listed and returned as assets of his estate and were assigned to his heirs, who are the individual defendants in this action. Later on the children of James Henry Gaines quitclaimed all of their interest in such lands to their mother, josie Gaines, one of the defendants herein, who is the present owner thereof.

¶7 All of the land acquired by the plaintiff and the individual defendants was listed and assessed for taxes in their respective individual names and the taxes paid from the corporation bank account the same as all other expenses of the two families were paid. The proceeds derived from the lands of all the parties were placed in the corporation bank account and used as a family account by all the parties regardless of what amount or for what purpose so long as the amount used was reasonable. At no time have the rights of creditors been involved in this family controversy. In 1929-1930 the two sons of the deceased brother began to assert...