Kelly v. Gram

• Decision Date: 19 July 1949
• Docket Number: 8981.
• Parties: KELLY v. GRAM et al.
• Court: South Dakota Supreme Court

38 N.W.2d 460

73 S.D. 11

KELLY v. GRAM et al.

No. 8981.

Supreme Court of South Dakota

July 19, 1949

Rehearing Denied Oct. 21, 1949.

Stephens & Riter, Pierre, Earl F. Jackson, St Paul, Minn., for plaintiff and appellant.

Martens & Goldsmith, Pierre, for defendants and respondents.

RICE, Circuit Judge.

Plaintiff and appellant, Daniel S.W. Kelly, and Ilma Kelly Gram, the defendant and respondent, are brother and sister. They are the only children and heirs of Robert L. Kelly, who for many years was a photographer in Pierre. He died on May 30, 1934 at the age of 83, after some years of ill health. Subsequent to 1932 he lived with defendant at her home in Minneapolis. Defendant is fifteen years older than plaintiff. She served as an army nurse in the first World War, after which she went to Minneapolis for further training, marrying her co-defendant, Robert Gram, in 1926. They established a home in Minneapolis and lived there until shortly before this action was commenced in 1945. They had no children. Plaintiff enlisted in the navy in 1917, at the age of sixteen, serving until 1919. Thereafter he attended the University of Wisconsin, graduating in 1925, since which he has resided almost continuously in Milwaukee. While in college, in 1919 plaintiff married and to the marriage a daughter, Jean, was born. He secured a divorce in 1924 and was awarded the custody of his daughter. In 1926 he remarried and to this union a son, Bobby was born. Plaintiff secured a divorce from his second wife and was given the custody of his son. Defendant cared for Jean Kelly in her home, as her own daughter, for several years subsequent to 1926. She cared for Bobby between 1935 and 1938. The trial court found that plaintiff had made settlement with her for taking care of his children. As to whether she was compensated for the love and affection bestowed, is not within the issues of this case.

Plaintiff in his complaint asked to be decreed the owner of a half-interest in the property which belonged to his father. This includes business properties in Pierre and Philip personal property--principally photographer's equipment--and land in Stanley and Haakon counties. He also asked a judgment for $4,835.92, and that it be decreed a lien on the property. This was for money loaned his father and payment of mortgage indebtedness which will be described later. The defendants, by their answer, asserted ownership in all the property, and by a counterclaim asked a judgment against plaintiff for $7,375.00, based on claims for the care and support of plaintiff's children.

The judgment of the trial court found that defendants were the owners of all of the property in dispute, but gave judgment to plaintiff for the amount asked and denied defendants judgment on their counterclaim.

Defendant Ilma Gram's title to the property in dispute rests upon deeds executed by her father on June 5, 1929, in which she is the grantee, a bill of sale to the personal property, executed June 26, 1929, and a deed to the Nelson property, dated July 10, 1930. The deeds were recorded and the bill of sale filed in July 1934, following the father's death. In June 1944, by conveyances to a third party, the title was placed in defendant Ilma Gram and her husband, Robert Gram, in joint tenancy.

As Robert Gram does not assert title as an innocent third party, the issues will be treated as existing between plaintiff and his sister, and she will be referred to as the defendant. She did not appeal from the adverse judgment on her counterclaim and that is now final.

Plaintiff by his assignments of error asks reversal of the judgment on three grounds: first, that there was no valid delivery of the deeds from Robert L. Kelly to defendant; second, that the evidence requires a finding that defendant holds an undivided one-half of the property in trust for him; and, third, that defendant is in equity estopped from asserting he is the owner of such half-interest. In considering the claims of plaintiff, further history of the relations of the parties will be developed. As a preliminary thereto it may be stated that the father at all times had a strong affection for both his children and they for each other. There was no family trouble of any kind and no misunderstanding, at least until 1941, when defendant refused to convey a half-interest in the property to plaintiff. Plaintiff did not learn that the property had been placed in joint tenancy by defendant until 1945. This action was then commenced. No question is raised as to the father's mental capacity. He was a business man of intelligence and character, who retained his faculties until his death.

The deeds (except to the Nelson lot) were executed by Robert L. Kelly at Pierre in June 1929, before a Pierre banker, J. R. (Jim) McKnight, an old-time friend, as notary public. Neither child was present. In July, following, Robert L. Kelly made a trip to Minneapolis to visit his daughter, taking the deeds along and a will which he had drafted in his own handwriting in 1922. This will is witnessed and in customary form, and gives all of the father's property to the daughter, Ilma, except a legacy of $100 to plaintiff. There is evidence in the record, in a letter from Ilma, that this will was executed to place the father's property, in the event of his death, beyond the reach of plaintiff's first wife. This and the will itself are only material in so far as it is evidence of the intention of the father in disposing of his property, or attempting to do so, by deed.

Defendant's evidence of delivery is that at her home, in July 1929, her father showed her the deeds, the bill of sale and will, handed them to her and said, in effect, 'I am giving you these deeds * * *. If there's a court action the court may not accept this, in case they don't I am giving you the will. If the Court will accept these deeds it will save probate expense but if anything comes up you will have this will.' She testified that her father told her she was to have the property, because Dan had received an education and more advantages than she, and because she would take care of Dan's children and had their interests at heart; that in case of need of the children, Bobby and Jean, she would have it for their care. Upon defendant's inquiry as to what she would do with the deeds, her father assented to her proposal that he take care of the deeds and the will and look after the property, because she was not a good business woman. The deeds were then placed in a suit case and were in the father's possession until his death. The testimony of Mrs. Mabel Sombke, an old and intimate friend of the family and particularly of Ilma, in all respects corroborates the testimony of defendant. Thereafter Robert Kelly returned to Pierre, taking the deeds and will with him. At Christmas time in 1929 he was again at his daughter's and plaintiff was likewise a guest. At that time the father asked his son to make a trip to Pierre, secure the deeds from his place of business, rent a safety deposit box and place them therein. The evidence is undisputed that he did this. It is likewise undisputed that after the claimed delivery the father retained complete control and possession of the property. He entered into a party wall agreement and paid part of the cost of the wall. He collected the rentals, paid the taxes and insurance, until his death. At least for some months before the father's death, the deeds were in a suit case in a closet off from the room occupied by him, and on various occasions were examined by him.

Possession of the deeds by grantor, permitting their destruction after claimed delivery, and retention of possession of the property, both constitute strong evidence of non-delivery. However, they do not invalidate a delivery previously made. In view of the trial court's express finding of delivery, supported not only by the testimony of defendant but of Mrs. Sombke, we conclude that the finding of the trial court should stand. Decisions of this court, supporting our views on delivery are: Wilmarth v. Hill, 55 S.D. 410, 226 N.W. 557; Birchard v. Simons, 59 S.D. 422, 240 N.W. 490; McGillivray v. Wipf, 64 S.D. 367, 266 N.W. 724; Benson v. Benson, 63 S.D. 241, 257 N.W. 460; Strain v. Ferris, 65 S.D. 226, 272 N.W. 677; Ansted v. Grieve, 57 S.D. 215, 231 N.W. 912.

Plaintiff's second contention is that there was an express agreement that defendant would hold title to one-half of the property as trustee for him. In support of this claim he testified to several conversations with his father, while defendant was present, to the effect that although the property would be conveyed to defendant, both children were to share equally therein. The first of such conversations was at Christmas time, in 1928, and as testified to by plaintiff was as follows:

'He said 'Ilma you are fifteen years older than Dan, I am going to make these deeds over to you, I have got confidence in you, I know I can depend upon you to do what I want.' He said, 'After I pass on I want to you to pay the funeral expenses and other expenses and after the property is all clear and unencumbered I want you Ilma to deed Dan a half interest in the property. He asked Ilma whether she would follow his wishes, whether she would do that and Ilma said 'Yes, dad I will, you can count on me dad.' Dad asked me if I was satisfied with the arrangements and I said 'yes, dad I trust Ilma as much as you do, I am perfectly satisfied.''

Other conversations, to the same effect as testified to by plaintiff, took place at defendant's home in June 1930 at Christmas in 1932 and at Christmas in 1933. The latter talks are to the effect that the half-interest in the property was to be deeded to plaintiff after the Nelson mortgage was paid. This...