Griffin v. Griffin

• Citation: 125 Vt. 425,217 A.2d 400
• Decision Date: 05 October 1965
• Docket Number: No. 1966,1966
• Parties: Ellen Johnson GRIFFIN v. William R. GRIFFIN and Bank of Waterbury.
• Court: Vermont Supreme Court

Page 400

217 A.2d 400

125 Vt. 425

Ellen Johnson GRIFFIN v. William R. GRIFFIN and Bank of Waterbury.

No. 1966.

Supreme Court of Vermont.

Oct. 5, 1965.

On Reargument Feb. 25, 1966.

Theriault & Joslin, John A. Burgess, Montpelier, for plaintiff.

Charles J. Adams, Waterbury (on original appeal), Black & Plante, White River Junction (on reargument), Frank G. Mahady, White River Junction (on reargument), for defendants.

Before HOLDEN, C. J., and SHANGRAW, BARNEY, SMITH and KEYSER, JJ.

SMITH, Justice.

This is an action brought by Ellen Johnson Griffin against her husband, William Griffin and the Bank of Waterbury under the Declaratory Judgment Act. The action was brought by Ellen Griffin to determine the validity of certain notes and assignments held by the Bank of Waterbury and signed by the petitioner. The defendant Bank of Waterbury has brought its appeal here from the Decree of the Washington County Court of Chancery.

The facts found by the chancellor, none of which were excepted to here, disclose the following factual situation:

Ellen Griffin and defendant William R. Griffin were husband and wife, although since about June 1, 1960, they had been living apart, and a divorce action brought by the petitioner against her husband had been pending in the Washington County Court since July, 1960, at the time of hearing.

Prior to November 15, 1959, Ellen Griffin, her husband and his mother and father were indebted to the Bank of Waterbury by reason of notes and mortgages as follows:

a. A note in the original amount of $800.00 dated March 2, 1956, and signed by Dennis Griffin and Ina Griffin, and by Ellen and William Griffin.

b. A note in the original amount of $7,200.00, dated March 2, 1956 and signed by Ellen and William.

c. A note in the original amount of $379.00, dated October 18, 1957, and signed by Ellen and William.

d. A note in the original amount of $1,485.53, dated December 16, 1958, and signed by Ellen and William.

e. A note in the original amount of $3,150.00, dated March 26, 1958, and signed by Ellen and William and by Dennis and Ina Griffin.

The findings disclose that until the middle of November, 1959, Ellen and William were in severe financial straits. They were continually delinquent in payments of both interest and principal on the above notes, and in tax payments on their home place. The requests made to them by the defendant Bank at frequent intervals to pay the various delinquencies, clearly demonstrate that the Bank was aware of their precarious financial situation. William Griffin was in the logging business, apparently without much success, for the joint checking account used to pay the bills of such operations was overdrawn at frequent intervals.

In the Fall of 1959, President Meaker and Director Brisbin of the Bank, visited the home of the petitioner. Mr. Meaker, in addition to being President and Director of the Bank, was an attorney, and his firm also acted as lawyers for the Bank. He had handled legal business for Ellen and William in the past, principally in preparing their income tax returns over the years. The purpose of the visit to the Griffin home at this time was to appraise its value, and to warn the Griffins that under the conditions then existing it might be necessary for the Bank to institute foreclosure proceedings against the property.

Ellen advised the Bank officials at the time of this visit that she was soon to receive an inheritance of money and stocks and that as soon as she received this inheritance she would bring the delinquencies up to date as far as the loans on the home place were concerned. On November 25, 1959, Ellen received her inheritance which consisted of $5,111.52 in cash and stocks then having a market value of $20,000. A listing of such stocks, given below, is necessary for an understanding of the questions presented on this appeal:

No. of shares Corporations

------------- ------------------------------

11 General Electric

22 General Portland Cement (1)

8 General Insurance (2)

11 Great Northern Railway

7 Gulf Oil Corporation

55 Metal and Thermit

11 Monmouth Racing Association

71 National Lead Co. Common Stock

13 Northern Pacific Railway (4)

17 Riegal Paper

13 Southern Company

22 United States Steel

22 U. S. Tobacco

40 Texas Company Two days after receiving her inheritance, Ellen made total payments to the Bank of interest and principal on the above mentioned notes of $684.24, and a short time later, paid in full a note dated December 16, 1958, with a then balance of $1,308.91, at the Bank's request.

It is from this point on, that is, from the time Ellen came into the possession of the money and stocks, that the Bank and the plaintiff entered into the transactions which are the subject of this controversy.

Involved here are five notes upon which Ellen's signature appears, given to the Bank between December 10, 1959 and April 29, 1960. Also involved are assignments to the Bank of the various stocks, listed above, signed by Ellen Griffin, ostensibly given as collateral security for the payment of some or all of the five notes. Plaintiff, in her complaint, asserts that she received no consideration for the notes given, and that by reason of the constructive fraud of the Bank, through its officers, she was induced to sign the various assignments of stock. The relief she seeks in her declaratory judgment action is a determination as to the actual ownership of the various stock certificates, as well as to her liability on the various notes.

Before proceeding to the decree of the chancellor relative to the right of ownership in the various stocks, and the liability of the petitioner on the respective notes, we must first resolve the questions initially presented to us in the brief of the Bank.

The Bank contends that the plaintiff, by her prayers, did not seek to have the chancellor determine the validity of any of the notes given by her to the Bank. But, as we said in Blanchard v. Knights, 121 Vt. 29, 36, 146 A.2d 173, 178:

'[T]he scope of a bill in equity is to be determined, not by the special prayers for particular relief, but by the case stated.'

In the earlier case of Hoadley v. Hoadley, 114 Vt. 75, 79, 39 A.2d 769, 773, the Court stated:

'Under the general prayer the plaintiff may have relief agreeable to the case made by the bill.'

In her bill, the petitioner states that one of the questions she seeks to have determined is 'as to the validity of certain of the notes and the validity of all the assignments * * *.' Such questions were before the chancellor for his determination.

The Bank also advances the argument that both the validity of the note and of the various stock assignments was conceded by the petitioner in her pleadings, as well as by the introduction by the petitioner, in evidence of the notes and assignments involved. It is true that petitioner in her pleadings admitted signing the various notes, and the chancellor so found. It is also true that petitioner introduced into evidence the various assignments of stock and her signatures and stated she has made 'a full and complete assignment' of her stock. But such pleadings and evidence were consistent with her further pleadings, and evidence, that such assignments were fraudulently obtained, and that certain of such notes were invalid.

It was essential for petitioner to plead existence and execution of the various notes and stock assignments, the validity of which she sought to have determined, as well as to introduce them into evidence. None of the cases cited to us by the defendant hold that such allegations in a pleading stops a plaintiff from asserting in the same pleading that such notes or assignments were invalid because of fraud or failure of consideration.

We cannot sustain defendant Bank's position that plaintiff had cast hereself by her pleadings so that she was estopped from denying the validity of the notes and assignments in the hearing below on the grounds of constructive fraud and failure of consideration.

Nor can we sustain the Bank's brief that the plaintiff should not have been allowed to introduce evidence to vary the terms or legal effects on the written instruments introduced in this case. The case of Lunnie v. Gadapee, 116 Vt. 261, 262-263, 73 A.2d 312, cited to us by the defendant does state, as defendant says, that the parol evidence rule applies where the enforcement of an obligation created by the writing is substantially the cause of action. But the opinion goes on to hold that an exception to the parol evidence rule is applicable where the parties to the litigation and to the writing are the same, but the instrument, as here, is not the basis of the action.

Nor has the defendant, in its brief, pointed out that claimed errors in the admission of such evidence was ever brought to the attention of the chancellor in the hearing below. No question shall be brought to the Supreme Court except that upon which it is made to appear that the trial court has had fair opportunity to pass judgment. Langevin v. Gilman, 121 Vt. 440, 442, 159 A.2d 340.

We now turn to the decree made below and the exceptions to it. Defendant Bank's exception to the decree raises only the question as to whether the decretal order is supported by the facts found. Lorenz v. Rowley, 122 Vt. 480, 486, 177 A.2d 364.

What now concerns us is a series of five notes signed by the petitioner between december 10, 1959 and April 29, 1960, together with certain assignments covering all the stock of the plaintiff, and which defendant Bank claims to be security for payment of these notes. The total amount of such notes exceeds $22,000.00.

The chancellor found that such notes and assignments of stock were signed by the petitioner under the following set of circumstances. They were signed by her either while in the hospital following an automobile accident in which she and her three children suffered personal injuries, or soon after leaving the hospital. The...