O'Leary v. McCarty

• Decision Date: 27 February 1973
• Docket Number: No. 34562,34562
• Citation: 492 S.W.2d 124
• Parties: F. Douglas O'LEARY, Administrator of the Estate of Mary Louise Kelly, Plaintiff-Appellant, v. John A. McCARTY, etc., et al., Defendants-Respondents. . Louis District, Division One
• Court: Missouri Court of Appeals

Page 124

492 S.W.2d 124

F. Douglas O'LEARY, Administrator of the Estate of Mary

Louise Kelly, Plaintiff-Appellant, v. John A. McCARTY, etc., et al., Defendants-Respondents.

No. 34562.

Missouri Court of Appeals, St. Louis District, Division One.

Feb. 27, 1973.

Moser, Marsalek, Carpenter, Cleary, Jaeckel, Keanye & Brown, F. Douglas O'Leary, St. Louis, for plaintiff-appellant.

Heneghan, Roberts & Godfrey, Bryan, Cave, McPheeters & McRoberts, R. H. McRoberts, Jr., Thompson, Mitchell, Douglas, Neill, Guerri & Elbert, W. David Wells, Theodore S. Martin, Martin A. Rosenberg, James J. Sauter, Joseph A. Lott, St. Louis, for defendants-respondents.

McMILLIAN, Judge.

This is an appeal by plaintiff, administrator of the estate of Mary Louise Kelly, from a judgment of the Circuit Court of St. Louis County sustaining the joint motion of defendants for summary judgment. Defendants are the administrators of the estate of Mary Louise Kelly's deceased husband, Joseph James Kelly, and various beneficiaries under the will of Joseph James Kelly. Plaintiff appealed. We affirm.

For the purpose of this appeal, we outline certain salient facts surrounding the Last Will and Testament of Joseph James Kelly; also we treat plaintiff's petition as amended as he sought. In 1964, Mary Louise Kelly and Joseph James Kelly jointly owned as tenants by the entirety the apartment building and property located at 7716--18 Maryland Avenue in the City of Clayton, Missouri. Sometime during that year Mary Louise Kelly conveyed her interest in that property to her husband through a straw party. In consideration for this transfer Joseph James Kelly allegedly executed a Will that provided benefits for the heirs of Mary Louise Kelly. This entire transaction was purportedly handled by defendant McCarty, attorney for Joseph James Kelly and Mary Louise Kelly.

On May 24, 1967, Joseph James Kelly died. On the 6th of July, 1967, Joseph James Kelly's Will was admitted into probate. In admitting that Will into probate, the Probate Court of St. Louis County in Cause No. 38439 stated that:

'. . . that said Will created a Marital Trust and a Residuary Trust, with each said Trust to hold approximately one-half of the distributable Probate Estate, and said Will further provided that, as to the Marital Trust, testator's wife, Mary Louise Kelly, was to be the sole life time beneficiary with Power of Appointment of the principal on her death as she may designate or appoint 'in her Last Will and Testament executed after my (Joseph James Kelly) death making specific reference to this Power of Appointment,' and that, if testator's said wife defaulted in her Power of Appointment, then the principal of said Marital Trust, remaining at the time of her death, shall be added to the Residuary Trust, and said Will further provided, as to the Residuary Trust, that testator's wife, Mary Louise Kelly and testator's sister, Charlotte M. Kelly, were to be the primary life time beneficiaries and that testator's brother, John J. Kelly, testator's sister-in-law, Norma V. Kelly, and John A. McCarty were to be contingent life time beneficiaries and that, upon the death of the survivor of all life time beneficiaries the then remaining principal of the Residuary Trust shall be distributed in equal shares to the Damon Runyon Cancer Fund, the Heart Fund, Multiple Sclerosis Society and the St. Jude's Hospital.'

On July 26, 1967, after a hearing, Mary Louise Kelly was declared non compos mentis and John A. McCarty was appointed her Guardian. Subsequently, John McCarty resigned and John J. Kelly, brother of the deceased Joseph James Kelly was appointed Guardian.

In March of 1968, Charlotte M. Kelly and John J. Kelly, sister and brother of the deceased Joseph James Kelly, filed a Petition to Contest the Will of Joseph James Kelly. The will contest allegedly involved the claim by the brother and sister of the deceased that defendant McCarty exercised undue influence over the deceased in assisting the deceased in the preparation of his Will.

On April 17, 1968, Mary Louise Kelly died. Patrick M. Fiandaca III, the Public Administrator of St. Louis County was appointed the administrator of Mary Louise Kelly's Estate and subsequently filed the appropriate pleadings to intervene in the Will contest case. On September 16, 1970, F. Douglas O'Leary, the plaintiff in this case, replaced Patrick M. Fiandaca III, who had resigned as the administrator of the Estate of Mary Louise Kelly. Plaintiff O'Leary filed an Amended Motion for Leave to Intervene and Notice in the Will Contest. On November 12, 1970, the Circuit Court of the County of St. Louis overruled plaintiff's 'Amended Motion of the Administrator of the Estate of Mary Louise Kelly to Intervene.' Plaintiff O'Leary did not appeal from this order.

On February 19, 1971, the Circuit Court of the County of St. Louis found that the instrument admitted to probate on June 7, 1967, and dated March 16, 1967, was the Last Will and Testament of Joseph James Kelly.

Plaintiff contends that the trial court erred in granting summary judgment as to Count I, in that the facts alleged in Count I showed that plaintiff's decedent was wrongfully deprived of certain property in such a manner that no adequate legal remedy was available. Further, that these facts, if proven at trial, would establish a situation in which the court should declare that either a resulting or constructive trust should be imposed with respect to the proceeds of the sale of property located at 7716--18 Maryland Avenue in Clayton, Missouri.

Plaintiff alleged in paragraph 8(a) of his amended petition that, ". . . Mary Louise Kelly conveyed the said property to her husband, and as part of the same transaction, her husband executed a will, the exact nature of which is unknown to plaintiff, but known to defendants herein; . . . that Mary Louise Kelly was influenced to believe that the conveyance of said property would benefit her said heirs, not defendant McCarty, who was the lawyer for Mary Louise Kelly and Joseph James Kelly in connection with said conveyance and said will . . . that the execution of said will was caused or contributed to by undue influence upon Joseph James Kelly by defendant McCarty and that the execution of said latter will to the benefit of Joseph James Kelly and his heirs and defendant McCarty without benefit to persons intended by Mary Louise Kelly, constituted a breach of the trust which came into existence at the time the property was conveyed by Mary Louise Kelly to her husband." Plaintiff contends that this paragraph establishes that either a constructive or resulting trust was created and such trust was subsequently breached.

There have been many definitions of a constructive trust recited by Missouri courts. What seems to be the most comprehensive definition of a constructive trust appears in Gwin v. Gwin, 240 Mo.App. 782, 219 S.W.2d 282 at 285:

'A constructive trust does not arise by virtue of any agreement or intention of the parties, actual or implied, but is implied by law, independently of their intention to create a trust. Suhre v. Busch, 343 Mo. 679, 123 S.W.2d 8. 'Obviously the constructive trust is not the product of the intent of the parties.' Kerber v. Rowe, supra, 348 Mo. (1125) page 1130, 156 S.W.2d (925) page 927; 3 Bogert, Trusts and Trustees, § 471. It is a device or method of the law of equity to effect restitution or to rectify a situation where a party has been wrongfully deprived of some right, title or benefit in property as a result of a fraud or violation of confidence or faith reposed in another. Fraud, actual or constructive, is the essential element of a constructive trust. Little v. Mettee, 338 Mo. 1223, 93 S.W.2d 1000; Wier v. Kansas City, 356 Mo. 882, 204 S.W.2d 268; Young v. Kansas City Life Ins. Co., 329 Mo. 130, 43 S.W.2d 1046.'

Most, if not all, instances of fraud or breach of faith reposed in another, involved a fiduciary or confidential relationship between either: (1) the alleged trustee and the beneficiary, Vol. 3, Scott on Trusts, § 462.4 at p. 3420; Service Life Ins. Co. of Fort Worth v. Davis, Mo.App., 466 S.W.2d 190; or (2) the grantee and the grantor, Bogert, Trusts and Trustees, 2d Ed., § 474; Vol. 3, Scott on Trusts, § 468 at p. 3441; Swon v. Huddleston, Mo., 282 S.W.2d 18, 55 A.L.R.2d 205; Karnopp v. Karnopp, Mo., 387 S.W.2d 527; wherein either the beneficiary or grantor is injured by a breach of the fiduciary duty or confidential relationship by the other party.

Plaintiff alleges that defendant McCarty exercised undue influence on the husband of Mary Louise Kelly that resulted in the husband executing a will to the benefit of Joseph James Kelly and his heirs and to the benefit of defendant McCarty in direct contravention of the agreement between Mary Louise Kelly and Joseph James Kelly wherein Mary Louise Kelly conveyed her interest in the property at 7716--18 Maryland Avenue to her husband. The allegations of undue influence do not involve the breach of confidential relationship or the breach of a fiduciary duty by a grantee to a grantor (Mary Louise Kelly). Here, there was only the allegation that undue influence was exercised over the grantee by a third party. This allegation does not constitute a basis on which a constructive trust may be found.

Further, plaintiff makes no allegation in his petition that Mary Louise Kelly was in anyway directly injured by the alleged exercise of undue influence by McCarty. The transfer of the property in question was purportedly made in return for the husband's execution of a will which was to provide substantial benefits for the heirs of Mary Louise...