Ison v. Ison, 51957

• Decision Date: 09 January 1967
• Docket Number: No. 51957,No. 2,51957,2
• Parties: Walter ISON, Mable Fitzgerald, Francis C. Ison, and Clyde Ison, and Walter Ison, Administrator of the Estate of Clarence W. Ison, Deceased, Appellants, v. Orville ISON, Eleanor Ison and Essie C. Ison, Respondents
• Court: Missouri Supreme Court

Page 65

410 S.W.2d 65

Walter ISON, Mable Fitzgerald, Francis C. Ison, and Clyde Ison, and Walter Ison, Administrator of the Estate of Clarence W. Ison, Deceased, Appellants, v. Orville ISON, Eleanor Ison and Essie C. Ison, Respondents.

No. 51957.

Supreme Court of Missouri, Division No. 2.

Jan. 9, 1967.

John M. Belisle and Morran D. Harris, Osceola, for appellants.

Poague, Brock & Wall, Barkley M. Brock, Julius F. Wall, Clinton, for responents.

STOCKARD, Commissioner.

In August 1964, Clarence W. Ison, a bachelor, died intestate at age 63. By Count respondents. of his estate, brought suit against Orville Ison and Eleanor Ison to recover $18,500 alleged to belong to Clarence's estate and to have been converted by Orville nd Eleanor to their own use. By Count II of the petition Walter, and two other brothers and a sister of Clarence, sought to set aside a deed from Clarence to their mother. After trial before the court without a jury, judgment was rendered against the plaintiffs on all issues and they have appealed. However, there is no issue on this appeal as to Count II.

After living on and operating a farm in St. Clair County for many years, because of his failing eyesight, Clarence sold his farm and equipment in 1962, and with his widowed mother moved to a house he had purchased in Appleton City. Because of his blindness and the infirmities of his mother it was necessary that someone take them to purchase groceries and to the various places necessary to conduct their ordinary business affairs. This was usually done by Orville or his wife. None of the plaintiffs lived close by. Clarence was a diabetic, and in June 1964, he became seriously ill. On June 14 arrangements were made for his admission to a hospital. Clarence responded to treatment but entries on his hospital record for June 25 indicated that he appeared 'despondent' and 'confused.' However, entries for June 27, 28 and 29 indicated that he was 'alert.' Dr. Jerry Feagan, a treating physician, stated that this period of confusion, and another episode occurring a few days earlier, were probably the result of a mild insulin reaction, and that such periods of confusion usually last four or five hours.

On June 29, Orville and his wife were at the hospital, and Clarence talked to them about getting his money which was then on deposit at the Citizens Bank of Appleton City 'out on interest,' and he said that he wanted to talk to Mrs. Claude Elliston, a long time acquaintance who had previously assisted him with his tax returns. After Orville and his wife left the hospital they saw Mrs. Elliston and told her that Clarence wanted to talk to her, and the three of them then returne to Clarence's hospital room. Clarence and Mrs. Elliston discussed 'what would be the best way, and how to fix it so that he could have some income' from his money, and Clarence suggested the use of a savings account at the Citizens Bank. During the conversation Clarence asked about making a will, and Mrs. Elliston told him that he should 'consider that because if there was a will made there would be probate costs.' Mrs. Elliston and Orville and his wife went to the bank, apparently to inquire about the use of a savings account, and then they returned to Clarence's room and brought with them Mrs. Freda Woods, the assistant cashier of the bank. Mrs. Woods told Clarence that the bank did not pay interest on savings accounts, and she suggested that he purchase United States Government bonds, series 'H.' After a discussion, pursuant to Clarence's instructions Mrs. Woods made a memorandum of the bonds he wanted to purchase. Mrs. Elliston testified that during the conversation Clarence said that he wanted Orville and his wife 'to have more than the rest of them' because they had 'done more than anyone else in the world for him.' Mrs. Woods testified that she explained to Clarence how the bonds could be made payable, and that he gave her the names of his brothers and his sister, and first instructed her to have a thousand dollar bond issued in his name and 'POD' (which means 'payable on death') to each of his brothers and his sister except Orville. He then directed her to reduce the amount as to each brother to $500, but to leave the amont for his sister at $1,000. He then directed that 'H' bonds be purchased in his name, 'POD' to Orville, in the amount of $6,000, and 'POD' to Orville's wife in the amount of $5,000. Mrs. Woods wrote a check in the amount of $13,500 payable to the Citizens Bank, which Clarence signed, and after she returned to the bank, 'H' bonds were issued as directed.

During this visit by Mrs. Woods, she and Clarence discussed his bank account. Clarence's mother had permission to write checks on his account, but according to Mrs. Elliston, Clarence said that it would be 'a good idea' that Orville's name be substituted for his mother's name because 'his mother's mental condition was hardly safe.' Mrs. Woods testified that Clarence said 'it was getting increasingly difficult for his mother to help with his affairs, * * * and he would like to have Orville's name on the bank account.' She explained 'how there was different ways,' and according to Mrs. Woods, 'he wanted it to be a joint account.' Mrs. Woods had with her a card prepared by the Citizens Bank. On one side of the card were the words: 'Authorized signature of,' and below that a blank line. On this line Mrs. Woods wrote: 'Clarence Ison or Orville M. Ison.' Below this was the name of the bank, and below that in much smaller print was a statement concerning the responsibilities and duties of the bank which would be applicable to every account. There then were three lines, each labeled 'Authorized signature.' On these lines there appears the signatures of Orville and of Clarence. Mrs. Elliston and Mrs. Woods each signed as a witness. At the bottom of the card, in the handwriting of Mrs. Woods, appears, 'Name added 6--29--64.' On the reverse side of the card was the caption, 'Joint Account-Payable to Either or Survivor.' There then followed the terms of an agreement between the depositors providing, among other things, that 'all funds now, or hereafter, deposited in this account, are, and shall be, our joint property and owned by us as joint tenants with right of survivorship, and not as tenants in common and upon the death of either of us any balance in said account shall become the absolute property of the survivor.' Following this were two lines for signatures, but neither Clarence nor Orville signed at any place on this side of the card. Mrs. Woods apparently took the card back to the bank. The ledger sheet shows that the account was changed from the name of Clarence with permission to his mother to write checks, to 'Clarence Ison or Orville M. Ison.'

Clarence left the hospital on July 1 and entered a nursing home at Butler, Missouri. A few days thereafter Clarence executed a deed to the house where he and his mother had lived whereby he conveyed title to himself and to his mother as joint tenants with right of survivorship. It was this deed that the brothers of Clarence, other than Orville, and the sister of Clarence by Count II of the petition sought to have set aside, but which is now not an issue on this appeal.

Orville wrote seven checks on the account, three before and four after Clarence's death. All were to pay bills of Clarence except the last which was in the amount of $7,440.80 and was payable to Orville. All but the last check were signed, 'Clarence W. Ison by Orville M. Ison.' Orville testified that he had a personal account in the same bank, and that he signed the checks in the manner he did in order to designate the account upon which the check was drawn.

The administrator of Clarence's estate contends on this appeal that he is entitled to judgment against Orville in the amount of $6,000 and against Eleanor in the amount of $5,000 'as a matter of law,' and that said amounts represent 'property taken by (Orville and Eleanor respectively) from the account of Clarence W. Ison and invested in U.S. Government Bonds, Series 'H', in the name of Clarence W. Ison, with (Orville and Eleanor respectively) as beneficiary.'

The ownership of the United States Government Bonds is governed by the laws of the United States and the regulations of the United States Treasury Department, and on their face, they are payable to the named beneficiaries after the death of Clarence. Union Nat. Bank v. Jessell, 358 Mo. 467, 215 S.W.2d 474; Valentine v. St. Louis Union Trust Co., Mo., 250 S.W.2d 167; 91 C.J.S. United States § 126c. However, those laws and regulations do not prevent the recovery of the proceeds of the bonds if they have been purchased with fraudulently acquired funds, Union Nat. Bank v. Jessell, supra. The administrator argues that (1) the evidence of an intention on the part of Clarence to make a gift 'was very vague and indefinite,' (2) the donees were 'active in the procurement of the said transfer;' (3) the donees exerted undue influence on Clarence; and (4) the donees were 'in a fiduciary relation' and 'in a position of...