Kelly v. Maxwell, 42990

• Decision Date: 02 February 1982
• Docket Number: No. 42990,42990
• Parties: Harriett W. KELLY, Individually and as Administratrix of the Estate of Alexander D. Kelly, deceased, Plaintiff-Respondent, v. Harriet E. MAXWELL, Defendant-Appellant.
• Court: Missouri Court of Appeals

Page 931

628 S.W.2d 931

Harriett W. KELLY, Individually and as Administratrix of the Estate of Alexander D. Kelly, deceased, Plaintiff-Respondent, v. Harriet E. MAXWELL, Defendant-Appellant.

No. 42990.

Missouri Court of Appeals, Eastern District, Division One.

Feb. 2, 1982.

Robert T. Ebert, Clayton, for defendant-appellant.

Andrew S. Meyer, Henry A. Freytag, St. Louis, for plaintiff-respondent.

PER CURIAM.

Plaintiff, as administratrix of her husband's estate, brought an action to have certain shares of stock declared an asset of the decedent's estate. Defendant, the only daughter of the decedent, appealed from judgment for the plaintiff administratrix. We affirm.

The decedent, Alexander D. Kelly, was born in 1892 and worked as an engineer-accountant until he retired in 1968. His first wife, Fannie, and he had one child, Mrs. Maxwell. Fannie died in 1964. At that time 3,535 shares of stock acquired between 1949 and 1963 were registered on the books of Laclede Gas Company in the names of Alexander D. Kelly, his wife, Fannie, and their daughter, Mrs. Maxwell, as joint tenants with right of survivorship and not as tenants in common. In 1965 an additional 1,000 shares were issued to Mr. Kelly and Mrs. Maxwell as joint tenants with right of survivorship and not as tenants in common.

In November, 1967 the plaintiff met Mr. Kelly while he was a patient at a hospital where she worked as a nurse. On or about Christmas, marriage was discussed, although the evidence conflicted as to who proposed to whom. In any case, they were wed on January 6, 1968. It was a "marriage of convenience." The amicability of the relationship survived for about six weeks and then seriously deteriorated. Plaintiff continued to take care of Mr. Kelly until his death in December, 1975.

An additional 500 shares of Laclede Gas Company stock were issued to Mr. Kelly and Mrs. Maxwell in October, 1970. In November, 1970 the 3,535 shares which bore Fannie's name were reissued, so that there were then 5,035 shares of stock registered in the name of Alexander D. Kelly and his daughter Mrs. Maxwell as joint tenants with right of survivorship and not as tenants in common. These shares were represented by 19 certificates.

In May of 1972, plaintiff commenced an action against decedent for legal separation and maintenance. On November 16, 1972 the decedent caused the 5,035 shares of stock to be listed on the corporation's books in his daughter's name alone, so that the defendant Mrs. Maxwell was the only registered owner, and had new certificates issued to reflect this change.

The stock certificates were kept in a safe deposit box in St. Louis. The defendant lived in Arizona. The defendant and her father owned the box jointly; she had a key and knew the password. She went to the safe deposit box on occasion, but always with her father.

It was defendant's practice to sign papers when requested to do so by her father. On occasion she would sign blank stock transfer forms, commonly called "stock powers," and return them to her father. These printed forms, signed in blank, would permit changes to be made in ownership of the stock when properly filled in. At least thirteen such stock powers were signed by defendant and given to her father. One was signed in 1972 or 1973, but defendant could not recall when she executed the other forms.

Defendant knew she was listed as an owner of the stock. It was her understanding that her father wanted his property to be in both names because he wished it to go to her upon his death without probate and, additionally, because he wanted to keep it from his second wife, the plaintiff. Defendant was not aware that the Laclede Gas Company stock was transferred to her and the certificates issued in her name alone in 1972. The decedent received the dividends from that stock and did not account for their disposition. Some years he would direct his daughter to report those dividends as her income for tax purposes and she would do so. In such cases he would reimburse her for corresponding taxes she was required to pay. This was the practice with respect to other jointly held property.

In June of 1975 the decedent made arrangements to borrow $31,000 from Mercantile Trust Company, and offered the Laclede Gas stock as collateral. The loan officer wrote the defendant, requesting that she sign an Agreement of Pledge and additional blank stock powers. The defendant signed the papers and returned them on the advice of her father. The money was lent to the decedent and he used it to purchase stock in Duke Power Company. The Duke Power Company stock was registered in the decedent's name alone. Following the loan, dividends from the Laclede Gas Company stock were sent to the Mercantile Trust Company and were applied against the loan.

The blank stock powers were in decedent's possession at the time of his death. Although he had had a will prepared by his attorney, no executed will was found. The will was drafted after the marriage but before the action for separate maintenance was brought by plaintiff in 1972. The attorney on decedent's directions prepared the will so that all property would go to his daughter, Mrs. Maxwell, but advised decedent that plaintiff could elect to "take against the will." The will included a recitation that adequate provision for decedent's wife had been made during his lifetime.

Plaintiff was appointed administratrix of decedent's estate by the Probate Court of the City of St. Louis and initially brought this action to determine title to personal property in that court. The cause was certified to circuit court. Before trial plaintiff dismissed two defendants (a bank and a savings and loan) who had been named along with Mrs. Maxwell. Pursuant to a court order, the Duke Power Company stock was sold and the proceeds used to satisfy the loan of Mercantile Trust Company; the stock certificates representing the 5,035 shares of Laclede Gas Company stock were deposited into the registry of the court. After evidence at trial was adduced, the plaintiff amended her petition to conform to the proof. For her alternative Count VI she pled:

"During his lifetime decedent exercised sole and unrestricted control and dominion over the said stock and never divested himself of any beneficial interest therein and that he owned same at his death as sole owner and that any other name appeared on the certificates therefor merely as an attempt to defeat the Laws of Descent and Distribution and to avoid probate.

"WHEREFORE, Plaintiff prays this Court order and decree that said stock be and is a proper asset of decedent's estate, and such other orders as may be just."

The trial court entered numerous findings of fact and conclusions of law. Those pertinent to this appeal are:

"That defendant, during her father's lifetime, did not consider the said Laclede Gas Company stock to be hers; that she did consider it to be her father's investment which he wanted her to have upon his death; and that she did not feel that she had the right to interfere with his control of it.

"That decedent, whenever he caused the said stock to be registered in joint names, intended thereby to avoid probate and to provide for devolution of his title thereto at his death.

"That when he terminated the joint registration of the said stock in November of 1972 and caused it to be registered in the sole name of his daughter, defendant herein, decedent did not intend to transfer title to her.

"That decedent never intended by registering the stock in the name of defendant, either jointly or solely, to transfer any interest to her during his lifetime.

"That decedent retained until his death the sole dominion and control of the stock here...