Kuhn v. Zepp

• Decision Date: 08 July 1946
• Docket Number: 39852
• Parties: Alfred Kuhn, Appellant, v. Elsie M. Zepp and Fred W. Zepp
• Court: Missouri Supreme Court

196 S.W.2d 249

355 Mo. 295

Alfred Kuhn, Appellant, v. Elsie M. Zepp and Fred W. Zepp

No. 39852

Supreme Court of Missouri

July 8, 1946

Appeal from Circuit Court of City of St. Louis; Hon. William S Connor, Judge.

Affirmed.

Fred E. Maetten and Roy M. Hardy for appellant.

(1) The express trust for the benefit of plaintiff was established in October, 1933; and the trial court erred in not so holding in view of the specific admissions and the cumulative evidence. Stephenson v. Stephenson, 171 S.W.2d 565; Hall v. Bank, 145 Mo. 418. (2) Admissions of defendants' counsel in the trial are binding and were alone sufficient for establishment of the trust. State v Reynolds, 224 S.W. 401; Pratt v. Conway, 143 Mo. 291; McNatt v. Wabash Ry. Co., 335 Mo. 1008, 74 S.W. 625; Wood v. Wells, 270 S.W. 332. (3) Answers of defendants to the interrogatories established the express trust by their own sworn statements. (4) Plaintiff's Exhibits I to XXVII, inclusive, acknowledged the trust relation by the manner in which defendants handled and managed the property, accounted to plaintiff and made monthly payments to him in the specific amounts agreed upon. Stephenson v. Stephenson, 171 S.W.2d 565. (5) Plaintiff's Exhibits I to XXVII, inclusive, sufficiently complied with the requirement that express trusts be expressed or manifested in writing. Stephenson v. Stephenson, 171 S.W.2d 565; Hall v. Bank, 145 Mo. 418; I Beach on Modern Equity Jurisprudence, sec. 150. (6) No consideration was given by defendants for the conveyance in 1933. (7) The defense of laches was supported by no evidence that the delay caused the position of defendants to change to their detriment. (8) If the element of laches influenced the lower court in rendering judgment, it was error and is assigned as such. Smith v. Hainline, 253 S.W. 1049; Stephenson v. Stephenson, supra; Rollestone v. Natl. Bank of Commerce, 299 Mo. 57, 252 S.W. 394; Laughlin v. Laughlin, 237 S.W. 1024; Elliot v. Machine Co., 236 Mo. 546, 139 S.W. 356; Murray v. King, 153 Mo.App. 710. (9) The trustees, defending by asserting their purchase from the cestui que trust, did not establish it by clear or convincing evidence. Neither did they affirmatively prove that there was no fraud, deception, unfairness or over-reaching on their part. Assuming that the judgment was based on that defense, we assign and specify it as error. Loud v. St. Louis Union Trust Co., 315 Mo. 552, 218 S.W. 744; Davidson v. Real Estate & Inv. Co., 249 Mo. 474; Newman v. Newman, 152 Mo. 398; McKee v. Spirs, 107 Mo. 452; Bochlert v. McBride, 48 Mo. 505; Price Heirs v. Evans, 26 Mo. 30; Lass v. Steinberg, 50 Mo. 124. (10) Defendants failed to offer clear and unequivocal evidence of the fairness of their alleged purchase from their cestui que trust or that they paid him an adequate price. Smith v. Hainline, 253 S.W. 1049; Newman v. Newman, supra; Davidson v. Real Estate & Inv. Co., supra.

Louis Shifrin and David R. Hensley for respondents; Taylor, Mayer & Shifrin of counsel.

(1) In an equity case the finding below will be deferred to by the Supreme Court and will not be disturbed unless clearly erroneous. Mercantile Commerce Bank & Trust Co. v. Kieselhorst, 350 Mo. 30, 164 S.W.2d 342; Niehaus v. Madden, 348 Mo. 770, 155 S.W.2d 141; Tobin v. Wood, 159 S.W.2d 287; Ulrich v. Zimmerman, 349 Mo. 772, 163 S.W.2d 567; Hobson v. Elmer, 349 Mo. 1131, 163 S.W.2d 1020. (2) The sale of the property in question by the plaintiff to the defendants was valid and should not be set aside. The plaintiff was sui juris. The defendants made a full disclosure of all the facts to the plaintiff. The price paid for the property was fair and reasonable. The defendants exerted no influence upon the plaintiff to induce the sale. Scott on Trusts, sec. 170.1; Restatement of the Law of Trusts of the American Law Institute, sec. 170, subsection (2), u; Taylor v. Gordon, 169 Ark. 1132, 278 S.W. 26; Guy v. Mayes, 235 Mo. 390, 138 S.W. 510; Bailey v. Waddy, 195 Ky. 415, 243 S.W. 21; Brown v. Cowell, 116 Mass. 461; Barnard v. Stone, 159 Mass. 224, 34 N.E. 272; Coates v. Lunt, 210 Mass. 314, 96 N.E. 685; Herpolsheimer v. Michigan Trust Co., 261 Mich. 209, 246 N.W. 81; Merriam v. Merriam, 136 Minn. 246, 161 N.W. 518; Ungrich v. Ungrich, 141 A.D. 485, 126 N.Y.S. 419 (1910), affirmed 207 N.Y. 662, 100 N.E. 1134; Matter of Daggett, 128 Misc. 588, 219 N.Y.S. 569; Waddy v. Grimes, 154 Va. 615, 153 S.E. 807; Wertz v. Clay, 157 Va. 263, 160 S.E. 27; Dodge v. Dodge, 102 F.2d 703; certiorari denied 308 U.S. 550, 60 S.Ct. 85, 84 L.Ed. 463; Winn v. Shugart, 112 F.2d 617; Hastings v. Jackson, 201 Ark. 1005, 148 S.W.2d 305; Malone's Guardian v. Malone, 255 Ky. 210, 73 S.W.2d 38; Schockett v. Tubin, 170 Md. 117, 183 A. 521; Stutzman v. Barnhart, 318 Pa. 285, 178 A. 673. (3) Even if the sale by the plaintiff might have been avoided if the plaintiff had sought relief promptly, such relief cannot be granted seven years later; such delay clearly constitutes laches on the part of the plaintiff. 1 Scott on Trusts, secs. 170.2 and 219.1; Hammond v. Hopkins, 143 U.S. 224, 12 S.Ct. 418, 36 L.Ed. 134; Marcum v. Wallace, 246 Ky. 726, 56 S.W.2d 5; Teachey v. Gurley, 214 N.C. 288, 199 S.E. 83; Quirk v. Liebert, 12 App. D.C. 394; Word v. Davis, 107 Ga. 780, 33 S.E. 691; Boyer v. East, 161 N.Y. 580, 56 N.E. 114; Randolph v. Vails, 180 Ala. 82, 60 So. 159; Hudson v. Barnes, 278 S.W. 395; Morgan County Coal Co. v. Halderman, 254 Mo. 596, 163 S.W. 828. (4) It was not necessary for the defendant to plead the sale from the plaintiff to the defendants since this sale was the termination of the trust agreement upon which the plaintiff relies.

OPINION

Ellison, J.

Judging from the petition, this case may be an action to define and adjudicate title to real estate under Sec. 1684, ^[1] or it may be a suit in equity to establish an implied trust ^[2] in the land, for the petition alleges a conveyance on a trust and prays an accounting of rents and profits. The answer in the main is a general denial coupled with affirmative pleas of ownership, estoppel and laches. At any rate the suit was tried to the court without a jury, and under Sec. 114(d) of the Civil Code, ^[3] is to be treated as of an equitable nature, calling for an appellate review upon both the law and the evidence. It clearly involves the title to real estate, and appellate jurisdiction is in this court under Sec. 3, Art. V, Const. 1945.

The plaintiff-appellant, Alfred Kuhn, is the father of the defendant-respondent Elsie M. Zepp and, of course, the father-in-law of her husband, the defendant-respondent Fred W. Zepp. Appellant was a married man. On October 19, 1933, while living in St. Louis he owned a residence property in that city described as Lot 11 in City Block 4979, and known as 7052 Tholozan Avenue, subject to a judgment lien in favor of a bank and some delinquent taxes. On that date he deeded the lot to his daughter, the respondent Elsie M. Zepp, by warranty deed. We are unable to find the deed in the transcript and there is no affirmative showing that his wife joined in it. But we assume she did, for these reasons.

It is admitted that appellant was having trouble with his wife and that she refused to join in the execution of a deed of trust on the property whereby he could borrow $ 2000 to pay off the judgment lien against it and alimony to her. The conveyance to the respondent daughter was made to put the title in such shape that the two respondents could obtain the real estate loan for these purposes. And it further appears that the appellant and his wife were later divorced and she was paid $ 500 as alimony in gross out of the proceeds of the loan. The judgment lien also was paid off, the total outlay for both being $ 1813.28. Further, some of the $ 2000 was used to pay past due water and gas bills, and the rest was consumed by appellant for living expenses.

It is further conceded the respondent daughter agreed to remit $ 15.00 per month to appellant out of the net income of the property, and that respondents would handle and try to sell the property and account to appellant for the income thereof. And they did account to him until June, 1936. Respondents contend that appellant sold the property to the respondent F. W. Zepp at that time, but executed no deed because the title already stood in the name of the respondent Elsie Zepp, for whom the purchase really was made. Respondents further assert that after they paid the purchase price appellant made no claim to the property for eight years until he brought this suit on June 28, 1944. In the meantime they had put a new loan for $ 2500 on it and improved it considerably. Respondent F. W. Zepp estimated its market value in 1944 at $ 5000.

After the divorce, or at least after the new $ 2000 deed of trust was made, appellant moved to California where he has since lived. Upon the filing of the suit each side served written interrogatories upon the other and the appellant made a request for an admission of the genuineness of 27 written exhibits, this under Sec's 85 and 88 of the Code. ^[4] These exhibits were letters written by one or another of the two respondents, and statements of account rendered by the respondent F. W. Zepp. Such of them as cover the period before respondents' alleged purchase of the property in June, 1936, are immaterial to the issue because respondents concede they were holding the title in trust for appellant prior to that. And some of the letter exhibits from the respondent daughter are undated and cannot be placed in chronological order. However, these do not throw light on the issues, except that one of them, which would have been written in the spring of 1936 judging from its exhibit number, told appellant her husband was trying to sell the property but...