Greenman v. McVey
| Decision Date | 05 June 1914 |
| Docket Number | 18,664 - (168) |
| Parties | JESSE E. GREENMAN v. WILLIAM McVEY and Another |
| Court | Minnesota Supreme Court |
Action in the district court for Goodhue county against William McVey individually and as administrator with the will annexed of the estate of Hugh Vallely, deceased, to recover $423.29. In his answer defendant denied that James H. Vallely, son of the testator, had any interest in the land left by the testator at his decease under the will mentioned in the opinion or otherwise; denied that the pretended levy of attachment or execution by plaintiff was of any effect alleged that defendant was the owner of the share of said James in the estate of his father by virtue of a written assignment of his title and interest in the year 1904. The case was tried before Johnson, J., who made findings and ordered that the action be dismissed on the merits. From the order denying his motion to amend the conclusions of law and order for judgment or for a new trial, plaintiff appealed. Affirmed.
Will -- equitable conversion of realty -- interest of legatee.
A testator by his will devised and bequeathed to his wife his real estate and personal property, and "after her death and within two years thereafter" gave and bequeathed to each of his children a specific sum of money, the total bequests to such children amounting to the sum of $5,200 approximately equal to the total value of his real and personal property, which personal property was worth $800 at the time the will was made and $300 at the time the testator died. After the testator's death, and before the death of his widow, a creditor of a son of the testator obtained a judgment, levied an execution on the son's interest in the real estate and purchased such interest at the execution sale. After the death of the widow, the real estate was sold under a license of the probate court to pay debts and legacies, and this action was brought by the creditor to recover of the administrator the son's interest in the proceeds of such sale. It is held:
(1) Though there is no express direction in a will to sell the real estate of testator and convert it into personalty, where it appears that the testator must have contemplated that it would be necessary to sell the real estate in order to carry out the provisions of the will, the direction is implied, and there is an equitable conversion of the realty into personalty.
(2) When the sale is directed, expressly or by implication, at a specified time in the future, in this case after the death of the life tenant, the conversion takes place in equity as of the date of the testator's death. Between that time and the actual sale the legatees of the testator had no interest in the land that could be levied upon or sold on execution.
Jesse E. Greenman and Mohn & Mohn, for appellant.
Thomas H. Quinn, for respondent.
February 12, 1901, Hugh Vallely, a resident of Goodhue county, made his will. After directing the payment of his debts and funeral expenses, the testator gave, devised and bequeathed to his wife during her natural life his real estate consisting of a tract of 160 acres, and another 10-acre tract, and his personal property. Then follows this language: "And after her death and within two years thereafter, I give and bequeath to the oldest son, Thomas M. Vallely, $100; to John O. Vallely, the second son, $100; to Peter J. Vallely, third son, $600; to Mary A. Vallely, $900; to Kate A. Vallely, $900; to Charles E. Vallely, fourth son, $600; to James H. Vallely, fifth son, $600; Ann M. Vallely, $1,200; to Frances D. Vallely, $200." The will contained no devise or bequest in terms of the remainder after the life estate of the wife.
Hugh Vallely died in June, 1905, seized of the 160-acre tract before mentioned. The will was admitted to probate September 25, 1905, and William McVey appointed administrator with the will annexed.
Plaintiff was a creditor of James H. Vallely, the fifth son of the testator, to whom, after the death of his wife, he gave and bequeathed $600. September 13, 1905, plaintiff commenced an action against James H. Vallely to recover his claim. In this action, a writ of attachment was issued and levied upon "all the right, title and interest in reversion or otherwise of the said James H. Vallely" to the 160 acres of land described in and devised by the will of Hugh. In May, 1906, judgment was entered in the action, execution was issued on the judgment, and a levy made upon the interest of the judgment debtor in the real estate. This interest, if the debtor had any interest, was thereafter sold to plaintiff at the execution sale, and a certificate of sale executed and recorded in June, 1907. No redemption was made from this sale.
Margaret Vallely, the widow of the testator, died March 10, 1910. March 31, 1910, the administrator applied to the probate court for license to sell the real estate of deceased, being the 160 acres before mentioned, for the purpose of paying the debts of deceased, and the bequests and legacies given by the will, as hereinbefore set out. After due notice and hearing, the court licensed and directed the administrator to sell the 160 acres at private sale for the purpose of paying the debts and legacies of deceased, and thereafter this real estate was, pursuant to the license, sold for $8,000. The sale was confirmed by the court. In December, 1911, the administrator filed his final account and petition for the settlement thereof, representing that he had paid the debts of deceased, including a $1,500 mortgage on the real estate, and had in his hands for distribution under the terms of the will $6,378.62, being part of the proceeds of the sale of said real estate. The court distributed and assigned the sum of $3,670.19, the residue, to the legatees named in the will. The share of James H. Vallely was the sum of $423.49.
Plaintiff demanded of the administrator the sum so assigned to James H. Vallely. The administrator refused to pay the same to plaintiff, and this action was brought to recover it. The case was tried to the court without a jury, and the decision was that plaintiff take nothing by the action. Plaintiff moved to amend the conclusions of law so as to find that he was entitled to recover, or if that was denied, for an order granting a new trial. The motion was denied, and plaintiff appealed from the order.
The findings of fact are not challenged. In addition to the facts stated above, the court found that at the time the will was made, the real estate was worth $35 per acre, subject to a $1,500 mortgage, and that the personal property then owned by the testator was worth $800. At the time of the testator's death, the 160 acres he then owned was worth $35 per acre, or $5,600, still subject to the mortgage, and his personal property was worth $300. The aggregate amount of the bequests to his children was $5,200. These figures have a bearing upon the question of the intent of the testator in making his rather peculiar and unusual will. It is noteworthy that the amount of his bequests is far in excess of the value of his personal property at the time the will was made, as found by the trial court, and is only slightly under the total net value of all the real and personal property then owned by the testator.
Plaintiff's claim that he is entitled to recover of the administrator the amount of the bequest to James H. Vallely is based first upon the contention that under the will, or under the statute, James H. acquired a reversionary interest in his father's real estate that could be seized and sold on execution. The will contains no residuary clause, and no express direction or power to sell the remainder after the termination of the life estate. If the testator died intestate as to this remainder, the land on the death of the life tenant would go in equal shares to his children, and James H. Vallely would have an interest in the real estate that might be seized and sold on execution against him. And if plaintiff acquired such interest by purchasing at the execution sale, he would be entitled to James H. Vallely's share in the proceeds of the sale by the administrator. Ness v. Davidson, 49 Minn. 469, 52 N.W. 46; Kolars v. Brown, 108 Minn. 60, 121 N.W. 229, 133 Am. Rep. 410.
But if there was an equitable conversion by the testator of the real estate into personalty so that the remainder must be regarded as personalty at the date of the testator's death, James H. Vallely never had an interest in the real estate described in the will, and the levy and attempted sale amounted to nothing. The case hinges therefore on the question whether there was an equitable conversion of the real estate into personal property at the date of the death of the testator.
The doctrine of equitable conversion has been applied in a multitude of cases, but not frequently in Minnesota. There is no doubt that an express direction by the testator to sell real estate and devote the proceeds to the payment of bequests or to other purposes amounts to an equitable conversion of the real estate into personalty. And where the time at which the land is directed to be sold is indefinite it is universally held that the conversion takes place, not when the sale actually takes place, but when the will goes into effect, on the death of the testator. The decisive questions in the case at bar are these: (1) In the absence of any express direction to sell the real estate to pay the bequests, does it clearly appear that it must have been the intention of the testator that his real estate be sold, and is this equivalent to an express direction? (2) In view of the fact that the sale could only take place after the termination of the widow's life estate, is the...
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