McCracken v. McBee

• Decision Date: 17 October 1910
• Citation: 131 S.W. 450
• Parties: McCRACKEN v. McBEE.
• Court: Arkansas Supreme Court

Page 450

131 S.W. 450

McCRACKEN v.McBEE.

Supreme Court of Arkansas.

October 17, 1910.

Appeal from Marion Chancery Court; T. H. Humphreys, Chancellor.

Suit by Victor B. R. McBee against Winnifred M. McCracken.Judgment for plaintiff, and defendant appeals.Reversed and dismissed for want of equity.

Testator, W. C. McBee, deceased, had a life insurance policy for $6,000, payable to complainant and certain other children, as beneficiaries, share and share alike, and to the survivors or survivor, but, in the event none of them survived, then to be paid to his executors, administrators, and assigns.Thereafter testator made a will by which he gave complainant and his other children a certain share of his estate, and provided that the life insurance money should become a part of his estate and be paid to his widow, defendant, in 20 annual installments of $300 each; one-third to become the property of the widow, and the remaining two-thirds to be used in educating complainant and his two sisters, so long as they should attend school and stay with defendant and be governed by her, and as they ceased to attend school and be so governed their respective shares should revert to and become the widow's property.Defendant was also directed to guide the course of complainant and the other children while minors, to superintend their education, and to use any money belonging to them under the will to pay for their necessary clothing, tuition, and board when away from home attending school.The will was duly probated, and defendant was appointed guardian of complainant, and he was sent to school until he was 21 years of age; defendant claiming that in educating complainantshe used all his personal estate and the money derived from the sale of lands in which he was interested and money collected from the life insurance.After complainant became of age, a settlement was had between him and defendant, by which he agreed to take $1,000 for his entire interest in the estate and life insurance, and in consideration thereof executed a deed of the real estate to defendant, and a bill of sale covering all his interest in the personal property, including the life insurance.On the faith of these instruments, defendant instituted proceedings to settle her account as guardian in the probate court, and while such proceedings were pending, three years thereafter, complainant brought this suit to cancel the deed and bill of sale for fraud.

S. W. Woods, for appellant.J. W. Black and Sam Williams(Thos. M. Pratt, of counsel), for appellee.

WOOD, J.(after stating the facts as above).

First.Cancellation of instruments is one of the well-recognized grounds of equity jurisdiction.It operates indirectly to establish or protect primary rights.It is often granted as ancillary and "preliminary to the final relief by which a party's primary right, estate, or interest is established and enforced."It is a remedy which belongs exclusively to the equity jurisdiction and is exercised in order to remove the obstacle which stands in the way of the enjoyment of one's right, interest, or estate."The occasions giving rise to the jurisdiction are mistake, fraud, and other instances where enforcing instruments or agreements would be inequitable or unjust.A doubt was formerly entertained as to whether a court of equity ought to exercise its jurisdiction to order instruments absolutely void at law, and not merely voidable, to be delivered up and canceled, since the legal remedy of a party was adequate and complete, and no case was presented for equitable interference; but it is now well settled that jurisdiction will be exercised in such cases except where the invalidity of the instrument is apparent on its face."Pomeroy, Eq. Jur. §§ 170-172, 1377.But while the chancery court had jurisdiction of the subject-matter of the cancellation of the deeds and bill of sale, it had no jurisdiction over the settlement of the guardian while that was still pending in the probate court.The bill of sale on its face was evidence of the settlement of appellant with appellee.But it was not the settlement itself.Unattacked for fraud or mistake, it would have to be taken as conclusive evidence of the settlement.Hence appellee could go into chancery to have the bill of sale canceled.Such relief was only ancillary to the settlement itself, and, the bill of sale being out of the way, the question of settlement still remained in the probate court.The chancery court therefore did not err in refusing to entertain the question of accounting, leaving that matter for final determination by the probate court.This is not a complaint to surcharge and falsify a confirmed settlement in the probate court for fraud.As to the accounting, it is sought to take it out of the probate court before that court has finally disposed of it.That cannot be done.Coppedge v. Weaver, 90 Ark. 444, 119 S. W. 678;Turner v. Rogers, 49 Ark. 51, 4 S. W. 193;Hankins v. Layne, 48 Ark. 544, 3 S. W. 821;Dyer v. Jacoway, 42 Ark. 186.

Second.The next question is: Did the court err in setting aside the bill of sale?Says Prof. Bispham: "Canceling an executed conveyance is the exertion of a most extraordinary power in courts of equity, and when asked for on any ground it will not be granted unless the ground for its exercise most clearly appears."Bisp. Eq. Prin. § 475.The evidence to overcome the "written memorial must be clear, unequivocal, and decisive."Carnall v. Wilson, 14 Ark. 482;Rector v. Collins, 46 Ark. 167, 55 Am. Rep. 571;McGuigan v. Gaines, 71 Ark. 614, 77 S. W. 52;Goerke v. Rodgers, 75 Ark. 72, 86 S. W. 837.

Appellee alleges and contends that the mistake he made in signing the instruments was caused by the misrepresentation and concealments of appellant and his misplaced confidence in her.In other words, he charges appellant with actual fraud, and seeks relief solely on that ground.The evidence fails to convince us that appellee is the victim of misplaced confidence.He says he trusted the appellant like a boy would trust his mother, and hence signed the papers without reading them, and without understanding them, and thought that he was only signing a deed to the land, as that was what appellant represented.In the light of all the other evidence, we are of the opinion that there was no misrepresentation and no concealment upon the part of appellant.Nor did appellee execute the instruments through any misapprehension caused by appellant, or because of any trust and confidence reposed in her.His own letters and the testimony of his own brother show that before the instruments were executed he had begun to distrust appellant, and that he was determined when he made the settlement with her "to get all that was coming to him."He assured his brother of that fact, and there is no doubt from all the testimony in the record that when he made the settlement with appellant, and when he executed the instrument evidencing such settlement, he was dealing with her at arm's length.Appellee was of age, had received excellent advantages of education, and the record does not disclose any evidence of mental imbecility on his part, but rather the opposite.The law requires that "the settlement of a guardian with his ward shortly after the latter's majority shall be closely scrutinized.The burden of proving good faith rests upon the guardian.To sustain a private settlement, the guardian must show that he fully and clearly disclosed the condition of the ward's estate at the time of the settlement, that he exercised no undue influence, and that the settlement is fair and equitable."21 Cyc.The conduct of appellant in dealing with appellee measures fully to the required standards.There is a general finding by the court that appellee executed the bill of sale to appellant...