Kohlhaas v. Smith

• Decision Date: 22 March 1951
• Docket Number: No. 31598,31598
• Citation: 97 N.E.2d 774,408 Ill. 535
• Parties: KOHLHAAS v. SMITH.
• Court: Illinois Supreme Court

Page 774

97 N.E.2d 774

408 Ill. 535

KOHLHAAS v. SMITH.

No. 31598.

Supreme Court of Illinois.

March 22, 1951.

Stephen M. Eleming and Eugene R. Ward, both of Chicago, for appellant.

Scott, Sakelson, Tyrrell & Collias, of Chicago (Joseph T. Tyrrell, Chicago, of counsel), for appellee.

WILSON, Justice. ^*

The plaintiff, Marie Kohlhaas, filed an amended complaint in the superior court of Cook County against the defendant, her brother, joseph A. Smith, seeking to establish a resulting trust in a parcel of real estate, in Chicago. Defendant's motion to strike plaintiff's plading was sustained, and the action dismissed for the want of equity. Plaintiff prosecutes this appeal, a freehold being necessarily involved.

Prior to, and on January 30, 1946, Edward Smith was the sole owner in fee simple of a parcel of real estate, improved with a one and one-half story frame building and basement, located at 2524 North Mont Clare Avenue, in Chicago. Smith and his wife, Catherine, purchased the property on January 26, 1926, and, from 1926 until their respective deaths, occupied the premises as their home. They satisfied the mortgage indebtedness and paid all the expenses of maintenance and repairs, fire insurance and other premiums, general taxes and special assessments. Catherine Smith died on July 27, 1944. Subsequently, on November 16, 1944, Smith executed his will, bequeathing and devising all his property equally between his two children, Marie Hohlhaas and Joseph A. Smith, and caused the will to be recorded. On January 30, 1946, Smith conveyed the property to Nellie C. Meyer who, the next day, conveyed to Smith and his son, Joseph A. Smith, as joint tenants. Both deeds were caused to be recorded on February 5, 1946. Smith died on June 10, 1948, survived by his daughter and son, his only heirs-at-law. Title to the property thereupon vested in Joseph A. Smith, as surviving joint tenant.

By her amended complaint, plaintiff alleged that no part of the purchase price of the real estate was furnished or paid by defendant; that, subsequent to her mother's death and the transfer of title in 1946, as described, her father, Edward Smith, exercised complete dominion over the ownership of the premises; that he leased protions of the property to, and collected rents from, tenants, and acted generally as owner of the property; that, at no time, did defendant consider himself the owner of any part of the property other than as a trustee for the rightful owner, his father; that, prior to and after the execution of the deeds creating the joint tenancy, Edward Smith stated to plaintiff, her husband, and other relatives that he had caused the transfer of title to the property in joint tenancy as a matter of convenience and to avoid unnecessary future expense incident to its sale; that, although defendant knew he was only a trustee of the legal title for Edward Smith and his heirs-at-law, only after his father's death did he begin to set up claims and attempt to exercise full ownership of the property, and that, prior to and since the death of their father, defendant has lived on the property, collected rents and assumed full ownership, not only of the real estate but of all personal property contained in the premises. The principal relief sought was a decree declaring defendant a trustee of the property, including personal property, for the heirs-at-law of Edward Smith, namely, plaintiff and defendant; an accounting by defendant of rents collected, and an order of partition.

Defendant's motion to strike the amended complaint and to dismiss the action averred that the complaint does not state a cause of action and that, in particular, it attempts to establish a trust based upon an alleged oral conversation, to create an interest in real estate by oral agreement or conversation in contravention of the Statute of Frauds, and to vary the terms of a written instrument by parol evidence. The motion to strike was sustained, as narrated, and the action dismissed.

Seeking a reversal, plaintiff contends that defendant merely holds title as trustee for her and himself for the reason that, although their father paid the entire consideration for the property, title was taken in the names of the father and defendant. She also urges that there was no unity of interest when the joint tenancy was created and that, in consequence, the surviving joint tenant holds title as trustee. To sustain the decree, defendant maintains that the transaction described in the complaint was not a purchase of real estate but, instead, a conveyance in joint tenancy of property which the father had long owned, and that he had the legal right to make a present gift of a one-half interest, together with the right of the son to become the owner of the entire title upon the father's death.

A resulting trust arises by operation of law from the acts of the parties and is not based upon contract. Houdek v. Ehrenberger, 397 Ill. 62, 72 N.E.2d 837. Where land is purchased with the money of one person and title taken in the name of another, and the acts of the parties establish an actual or presumed intention to create a trust, the law raises a resulting trust in favor of the person whose money was used. Murray v. Behrendt, 399 Ill. 22, 76 N.E.2d 431; Kane v. Johnson, 397 Ill. 112, 73 N.E.2d 321; Houdek v. Ehrenberger, 397 Ill. 62, 72 N.E.2d 837. It arises, if at all, the instant the legal title is taken and the title vests. Murray v. Behrendt, 399 Ill. 22, 76 N.E.2d 431; Kane v. Johnson, 397 Ill. 112, 73 N.E.2d 321; Nickoloff v. Nickoloff, 384 Ill. 377, 51 N.E.2d 565; Spina v. Spina, 372 Ill. 50, 22 N.E.2d 687; Wiley v. Dunn, 358 Ill. 97, 192 N.E. 661; Falgowski v. Daniel, 333 Ill. 208, 164 N.E. 405. The burden of proof rests upon the party seeking to establish a resulting trust, and the evidence, to be effective for this purpose, must be clear, convincing, unequivocal and unmistakable, and must establish beyond a doubt the payment by the claimed beneficiary at the time the title was taken in the alleged trustee. Hille v. Barnes, 399 Ill. 252, 77 N.E.2d 809; Houdek v. Ehrenberger, 397 Ill. 62, 72 N.E.2d 837; Curielli v. Curielli, 383 Ill. 102, 48 N.E.2d 360; McCarthy v. McCarthy, 289 Ill. 365, 124 N.E. 578. If the evidence is doubtful or capable of reasonable explanation upon any theory other than the existence of a trust it is insufficient. Hille v. Barnes, 399 Ill. 252, 77 N.E.2d 809; Houdek v. Ehrenberger, 397 Ill. 62, 72 N.E.2d 837; Goelz v. Goelz, 157 Ill. 33, 41 N.E. 756. Resulting trusts are expressly excepted from the operation of the Statute of Frauds and may be proved by parol evidence. Ill.Rev.Stat.1949, chap. 59, par. 9; Murray v. Behrendt, 399 Ill. 22, 76 N.E.2d 431; Kochorimbus v. Maggos, 323 Ill. 510, 154 N.E. 235; Froemke v. Marks, 259 Ill. 146, 102 N.E. 192.

...