Hensley v. Ball

• Decision Date: 26 June 1964
• Citation: 380 S.W.2d 279
• Parties: William S. HENSLEY, Administrator of the Estate of Smith Ball, Appellant, v. Mattie BALL et al., etc., Appellees.
• Court: United States State Supreme Court — District of Kentucky

Page 279

380 S.W.2d 279

William S. HENSLEY, Administrator of the Estate of Smith

Ball, Appellant, v. Mattie BALL et al., etc., Appellees.

Court of Appeals of Kentucky.

June 26, 1964.

Wix Unthank, Harlan, for William S. Hensley, Adm'r of Smith Ball estate.

Ray O. Shehan, Harlan, Edward Dooley, Middlesboro, for Charlie, Dizney, and Carter Ball, Ethel Ball Gilbert, and J. R. Weiler, Adm'r of Robert Ball Estate.

William A. Rice, Harlan, for Mattie Ball.

Joe A. Wallace, Louisville, for Creed Ball, Woodrow Ball, Beatrice Ball Ashurst, and Beatrice Ball Ashurst, Admr'x of Willard Ball Estate.

PALMORE, Judge.

Smith Ball died intestate at his home in Harlan County on June 2, 1954, at the age of 77. He was survived by his wife, Mattie, and two sets of children by previous marriages. He had amassed a substantial amount of property during his lifetime, and his death was followed by controversy among the survivors. This is a suit by the administrator against the widow and children to recover assets and settle the estate. Each and all of the parties have appealed from various aspects of a partial judgment (made final and appealable as authorized by CR 54.02) determining ownership of the personal property.

One set of the children consisted of Charlie Ball, Dizney Ball, Robert Ball, Carter Ball and Ethel Ball Gilbert. Robert died during the proceeding, and his interest is now represented by an administrator.

The other set of children consisted of Creed Ball, Willard Ball, Woodrow Ball, and Beatrice Ball Ashurst. Willard died during the proceeding and his interest is now represented by an administratrix.

Except that he operated a second hand store and apparently engaged in the business of lending money, the record does not reveal the origins of Smith Ball's fortune. However, during the later years of his life a goodly part of his income was derived from numerous securities in which he had invested. Over a long period of time he bought and sold many of these securities in the names of the various children but collected the dividends and interest himself and from time to time gave money to the children to cover taxes they were required to pay on this income. ¹ Most of the bonds and stock certificates falling in this category were kept in a safe which belonged to Smith Ball but was located in the home of his son Charlie, and to which Charlie had access. Both Charlie and Dizney worked for their father most of their lives, and their homes were situated close to his home. Dizney handled most of his stock investments and transactions, whereas Charlie kept the safe and, at his father's direction, endorsed the names of his brothers and sisters (excepting Dizney) on dividend checks payable to them and paid the money over to his father. This was done without the specific consent of the other members of the family, but for the most part ² they were aware that stocks were being bought, sold and exchanged in their names and that Smith Ball was receiving the income.

Several stocks acquired by Smith Ball in the name of his wife, Mattie, were kept by her in a cedar chest at home. Just who endorsed the dividend checks (if any) on this stock is not clear, but presumably the money went to Smith Ball. Though Mattie regarded the stock as belonging to her husband during his lifetime, after his death she sold it and retained the proceeds, amounting to $5,299.53. Her position now, however, is that all of the securities acquired by Smith Ball really belonged to him, and not to the persons in whose names he caused them to be issued. ³

For the purposes of this discussion the property in dispute can be classified as follows:

1. Corporate stock certificates in the possession of the person named thereon as owner and on which the named owner was receiving and retaining dividends prior to Smith Ball's death. This included $155,000 worth of stock in Dizney's, $28,000 in Charlie's, and $20,000 in Robert's possession, and they were adjudged the owners.

2. Corporate stock certificates in Mattie's name kept in the cedar chest at the home of Smith and Mattie Ball, as heretofore mentioned. The Smith Ball estate was adjudged the owner and thus entitled to recover $5,299.53 from Mattie.

3. Corporate stock certificates in the names of the respective children, kept in the safe at Charlie's house and delivered or caused to be delivered by Charlie to the named owners after their father's death. Dividend checks thereon had been endorsed by Charlie at his father's direction, as heretofore mentioned. The Smith Ball estate was adjudged the owner and entitled to recover $11,500 from Charlie, $179 from Ethel, $2,500 from Robert, $265 from Willard, $16,000 from Woodrow, and an unascertained amount from Carter.

4. Kentucky Finance Company debenture bonds, each in the names of Smith Ball or one of the children. Some were in the safe at Charlie's house and the rest had been left at the office of the finance company in Lexington. All were delivered to the respective co-owners after the death of their father. The Smith Ball estate was adjudged the owner and entitled to recover $5,000 from Charlie, $4,000 from Dizney, $5,000 from Robert, $6,500 from Willard, $6,500 from Woodrow, $4,800 from Creed, $5,500 from Beatrice and $500 from Carter.

5. U.S. 'E' Bonds, each in the names of Smith Ball or one of the children, kept in the safe at Charlie's house and delivered or caused to be delivered by Charlie to the respective co-owners after their father's death. The Smith Ball estate was adjudged the owner and entitled to recover $900 from Ethel, $1,840 from Robert, $1,650 from Willard, $2,200 from Woodrow, $1,650 from Creed, $830 from Beatrice, and $750 from Carter.

6. Finance company stock certificates, each in the names of Smith Ball or one of the sons, kept in the safe at Charlie's house and delivered to the respective co-owners after the father's death. The Smith Ball estate was adjudged the owner and entitled to recover $4,000 from Charlie and $2,500 from Dizney.

7. Certificate for 1,000 shares of Kentucky Finance Company common and certificate for 1,000 shares of New Finance Company preferred, each in the names of Smith, Charlie or Dizney Ball, kept in the safe at Charlie's house and delivered by Charlie to Dizney after their father's death. The Smith Ball estate was adjudged the owner and entitled to recover $11,500 from Dizney.

8. Certificate for 500 shares of New Finance Company common, in the name of Smith Ball as trustee for Dizney Ball, kept in the safe at Charlie's house and delivered by Charlie to Dizney after his father's death. The Smith Ball estate was adjudged the owner and entitled to recover $1,500 from Dizney.

9. Three promissory notes payable to Charlie Ball, evidencing money loaned by Smith Ball. Payments on principal and interest during Smith Ball's lifetime were collected by Charlie and turned over to his father. ⁴ These notes had been kept at the store and were taken by Charlie after his father's death. The Smith Ball estate was adjudged the owner and entitled to recover $1,050 from Charlie.

10. A $90,554.17 account in First Federal Savings and Loan Association of Winter Haven, Florida, and a $7,300.50 account in First Federal Savings and Loan Association of Lakeland, Florida, opened in November of 1953 in the names of Smith Ball or Charlie Ball. The funds deposited to these accounts were taken to Florida from Harlan by Smith Ball, who took Charlie with him to the two institutions and had him sign the required signature cards. After his father's death Charlie removed $57,000 (or, as he contends, $47,000) of this money. The balance was seized by the Internal Revenue Service, which charged onto the scene like a mad rhinoceros after Smith Ball's death and...