Merritt v. Easterly
| Decision Date | 07 March 1939 |
| Docket Number | 44517. |
| Citation | 284 N.W. 397,226 Iowa 514 |
| Parties | MERRITT et al. v. EASTERLY. |
| Court | Iowa Supreme Court |
Appeal from District Court, Jones County; H. C. Ring, Judge.
Suit in equity to set aside transfers of real and personal property because of the undue influence and the dominance of the defendant over the deceased in combination with her mental weakness. From a decree for the plaintiffs, the defendant has appealed.
The decree is affirmed.
J. E Remley, of Anamosa, and Harold E. Davidson, of Clarinda, for appellant.
C. J Lynch and William M. Dallas, both of Cedar Rapids, for appellees.
The appellee, W. D. Merritt, is the administrator with the will annexed of the estate of Harriet E. Rummell, deceased. The appellee, Consolidated Independent School District, is the residuary legatee and devisee of the testatrix. The appellant is the grantee in two deeds, executed by the deceased, and conveying to him eighty acres of land in Thayer County Nebraska, and one hundred eighteen acres in Jones County, Iowa. He also took possession of two certificates of deposit, and the proceeds of a third certificate, all of which were originally issued to the deceased, and certain other personal property.
The petition of the appellees alleges that for more than two years prior to her death on April 6, 1937, when she was more than eighty-seven years old, the health of the testatrix was so impaired, and her mental and physical powers had so failed, that, at the time the transfers and conveyances of property were made, she did not have sufficient mental capacity to make them. The petition further alleges that during this period a fiduciary and confidential relation existed between the testatrix and the appellant, and that the latter took complete charge of all of the property and the business affairs of the testatrix, and by reason of her implicit trust and confidence in him, and his dominance over her, he acquired the title and possession of the property in controversy. Appellants prayed for an annulment of these transfers, for a return of the personalty and all income and rentals, for a reconveyance of the Nebraska real estate, the quieting of title to the Jones County real estate in them, and for general equitable relief.
The appellant in his answer denied generally, and alleged that he had performed valuable services for the deceased for many years, for which he had not been paid, and that the transfers of all of the property had been made to him voluntarily by the deceased as a gift because he had not been compensated for his valuable services or for the many kindnesses he had bestowed upon her. The trial court granted relief to the appellees, as prayed.
For the court, at this time, to discuss, at length, the equitable or legal principles and the authorities having to do with the issues involved in this action, would be a work of supererogation, in view of the able and exhaustive discussions of principles and collations of authorities, by Justice Weaver, in Curtis v. Armagast, 158 Iowa 507, 138 N.W. 873, Justice Evans, in Johnson v. Johnson, 196 Iowa 343, 191 N.W. 353, Justice Kindig, in McNeer v. Beck, 205 Iowa 196, 217 N.W. 825, Justice Morling, in Utterback v. Hollingsworth, 208 Iowa 300, 225 N.W. 419, Justice Mitchell, in Ennor v. Hinsch, 219 Iowa 1076, 260 N.W. 26, Justice Richards, in Jensen v. Phippen et al., Iowa, 280 N.W. 528, and in Vorse v. Vorse, 186 Iowa 1091, 171 N.W. 186,Sullivan v. Kenney, 148 Iowa 361, 126 N.W. 349,Good v. Zook, 116 Iowa 582, 88 N.W. 376,Pruitt v. Gause, 193 Iowa 1354, 1357, 188 N.W. 798,Hull v. Mitchell, 181 Iowa 51, 162 N.W. 235,Drefahl v. Rabe, 132 Iowa 563, 107 N.W. 179,Fitch v. Reiser, 79 Iowa 34, 44 N.W. 214,Spargur v. Hall, 62 Iowa 498, 17 N.W. 743,Lampman v. Lampman, 118 Iowa 140, 91 N.W. 1042,Burger, Adm'r v. Krall et al., 211 Iowa 1160, 235 N.W. 318.
The appellees in their petition alleged both mental incapacity and undue influence. If their cause of action depended upon the establishment of either of these issues, the burden would be upon them to prove the same by clear, satisfactory and convincing evidence, in order to set aside the conveyances. Curtis v. Armagast, supra; McNeer v. Beck, supra; Johnson v. Tyler, 175 Iowa 723, 157 N.W. 184; Sutherland State Bank v. Furgason, 192 Iowa 1295, 186 N.W. 200; Zinkula v. Zinkula, 171 Iowa 287, 154 N.W. 158; Brackey v. Brackey, 151 Iowa 99, 130 N.W. 370.
But coupled with these allegations is the additional one that the conveyances of the real estate and the transfers of the personal property were procured by the appellant, while he was the dominating person in a fiduciary and a confidential relation, existing between him and the deceased. As stated in Thomas v. Whitney, 186 Ill. 225, 57 N.E. 808, 810," there is a well-defined distinction between undue influence arising from acts which the law deems fraudulent and undue influence resulting from fiduciary relations existing between the parties. * * * Pomeroy, in his work on Equity Jurisprudence (vol. 2, § 955), says: ‘ Nothing can tend more to produce confusion and inaccuracy in the discussion of the subject (undue influence) than the treatment of actual undue influence and fiduciary relation as though they constituted one and the same doctrine.’ The same author says (section 947): ‘ The term " fiduciary or confidential relation," as used in this connection, is a very broad one. It has been said that it exists, and that relief is granted, in all cases in which influence has been acquired and abused,-in which confidence has been reposed and betrayed. The origin of the confidence and the source of the influence are immaterial. The rule embraces both technical fiduciary relations and those informal relations which exist whenever one man trusts in and relies upon another. The only question is, does such a relation in fact exist?" '
" While the phrases ‘ fiduciary relations' and ‘ confidential relations' are frequently used as convertible terms, strictly they are of differing significance." Jensen v. Phippen, Iowa, 280 N.W. 528, 529, and Curtis v. Armagast, both supra.
The American Law Institute defines the terms, thus: 1 Restatement of The Law of Trusts, Section 2b.
The phrases are used by the courts and law writers as convertible and synonymous terms. Bacon v. Soule, 19 Cal.App. 428, 126 P. 384; Ewing v. Ewing, 33 Okl. 414, 126 P. 811.We have no intention of fettering the operation of the principles which have been consistently followed by this and other courts in cases of this kind by undertaking to define the various confidential, or fiduciary relationships, or the precise limits thereof.
No witness in this case testifies to any false or fraudulent representations which the appellant made to the deceased, or to any deceit or trickery which he practiced upon her. In the view which we take of the case such proof is not necessary to support the decree. As stated by this court, in Burger v. Krall, supra, 211 Iowa 1160, on page 1167, 235 N.W. 318, on page 321, " The circumstances loudly cry fraud, but, if there is doubt about the sufficiency of the evidence to show actual fraud, equity from the proved relationship and the advantage obtained by defendants therein implies fraud, and demands of defendants proof that decedent, in extending to defendants the profits and advantages which they now claim, acted with freedom, intelligence, and full knowledge of all the facts."
The rule to guide us in this case has been very well and fully stated by Justice Morling, in Utterback v. Hollingsworth supra, 208 Iowa 300, 301, on pages 302 and 303, 225 N.W. 419, on page 421, as follows: ...
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