Milliman's Estate, In re
| Decision Date | 20 October 1965 |
| Docket Number | CA-CIV |
| Citation | 406 P.2d 873,2 Ariz.App. 155 |
| Parties | In the Matter of the ESTATE of Willard J. MILLIMAN, Deceased. FARMERS INSURANCE GROUP, Appellant, v. Neil J. WARD, Administrator de bonis non of the Estate of Willard J. Milliman, deceased, and Clarabelle Milliman, et al., Appellees. * 279. |
| Court | Arizona Court of Appeals |
Chandler, Tullar, Udall & Richmond, by D. B. Udall, Tucson, for appellant.
Rees, Estes & Browning, by Donald Estes, Tucson, for appellees.
Willard J. Milliman was killed in an automobile accident on March 2, 1961. On May 2, 1961, Lucy Milliman filed a petition in probate court to be appointed administratrix of the estate of the deceased, stating she was the widow of Willard J. Milliman and the two children named in the petition were his children. Notice of the hearing on the petition was published as required by law and was sent to the persons named in her petition as next of kin of the deceased, viz., herself, her two children, and the parents of the deceased. On May 15, 1961, letters of administration were issued her. Her bond was set in the sum of $1.00 and was posted.
On the same date the letters were issued, Lucy Milliman filed a petition to settle and compromise for $50,000.00 a wrongful death claim, arising out of the death of Willard J. Milliman, against Ralph W. Kennedy, doing business as Ralph's Truck Service, Floyd E. Tucker, and Allender & Lachemmyer. This petition was heard and acted upon by the court on the same day as it was filed.
In her petition she asked that she be authorized and directed to pay $33,333.33 of the money to herself, and $16,666.67 to herself as guardian of the persons and estates of the two minor children, and that upon receipt of $50,000.00 she be authorized to execute individually, and as administratrix of the estate of the deceased, a full and complete release to Ralph W. Kennedy, d/b/a Ralph's Truck Service, Floyd E. Tucker and Allender & Lachemmyer. No notice of any hearing upon this petition was given to any person. Appearing at the hearing was counsel for the Farmers Insurance, who had prepared the petition to compromise, but who made it clear to the court that he was not representing the petitioner, but rather the insurance company which proposed to pay the $50,000.00 in settlement. On May 15th, the probate judge signed the order authorizing a compromise of the claim for the sum of $50,000.00 and a distribution of said sum as petitioned. The bond of the administratrix was left at the sum of $1.00.
Following the court's approval of the settlement on May 15, 1961, the sum of $50,000.00 was paid by Farmers Insurance of Lucy Milliman. The amount going to the two children ($16,666.67) named in the petition was deposited in a court-controlled bank account. The amount of $33,333.33 was paid directly to the administratrix Lucy Milliman.
On July 27, 1961, Lucy Milliman petitioned in probate for final distribution of the estate, and for a discharge of herself as administratrix. Final decree of settlement and discharge of administratrix was signed by the court on August 24, 1961.
On April 25, 1962, Clarabelle Jean Milliman Childs filed petition in probate asking for revocation of letters of administration of Lucy Milliman, alleging that she, Clarabelle Milliman Childs, had married the deceased, Willard J. Milliman, on July 15, 1950, in South Dayton, New York, and that this marriage had not been terminated prior to his death. It alleged further that six children had been begotten to the deceased and Clarabelle Milliman by said marriage, and that she and her six children were lawful heirs of the deceased. This petition resulted in a hearing and an order of the court dated January 18, 1963, which found all issues in accordance with the petition, ordered that the letters of administration of Lucy Milliman and the discharge granted her be revoked, and issued letters of administration be bonis non to Neil J. Ward. No appeal has been taken from this order.
Neil J. Ward, as administrator de bonis non, on April 11, 1963, filed a petition to set aside the court's order of May 15, 1961, approving the settlement of the death claim. The Farmers Insurance was notified of this petition and appeared in opposition thereto. However, there was no notice given to any of the children of the deceased nor to the alleged tort-feasors, Ralph W. Kennedy, Floyd E. Tucker and the individuals designated as 'Allender & Lachemmyer' in the petition to compromise. Farmers Insurance presumably appeared below and appears here on their behalf, though the record is not clear in this respect. In passing, it should be noted that a liability insurance company is not usually regarded as a real party in interest in actions to determine the liability of the insured. 29A Am.Jur. Insurance § 1485; 46 C.J.S. Insurance § 1191.
At the hearing on May 22, 1963, the testimony of Lucy Milliman revealed that when she had filed the petition for probate and the petition to compromise the death claim she knew of Clarabelle and the six children in New York and knew that Clarabelle contended there had not been a termination of this prior marriage. The evidence did not establish, however, that she had informed Farmers Insurance of these facts. On appeal, appellees do not contend that Farmers Insurance knew of Lucy's fraud upon the court or participated therein.
Lucy's testimony at the hearing was to the effect that she had squandered the money she had received in the settlement by making trips to various race tracks and to Las Vegas, buying clothes for herself and making loans to relatives whom she could not locate.
The lower court entered an order on July 23, 1963, that the 'acts' of Lucy as administratrix, including the order authorizing a compromise of the death claim '* * * are void and of no further effect so far as they effect [sic] the interests * * *' of Clarabelle and her children. It is from this order of the lower court that the appellant Farmers Insurance has appealed.
The appellant urges before this court that the lower court erred in setting aside its prior order authorizing the settlement because by doing so, it permits, in effect, two wrongful death actions to be brought instead of the single one the insurance company contends the statute contemplates. The administrator de bonis non, on the other hand, maintains that the conduct of Lucy constituted such extrinsic fraud as would justify the setting aside of the court-approved settlement.
The undisputed facts of this case cry aloud for some remedy for the widow and six children of the deceased's 1950 marriage. These persons had no notice of the probate proceedings, other than that which they might have acquired from a publication in an Arizona newspaper while they were residents of New York. Likewise, they had no notice of the hearing upon the petition to settle the death claim, that hearing having been conducted ex parte. They are unprotected by any bond posted, and if the appellant prevails here, will be relegated to a suit against a person of admitted irresponsibility. However, this court is cognizant that harsh facts sometimes make even harsher law which can haunt the judicial halls for years to come.
A temptingly simple way to allow relief would be to accept the appellee's thesis to the effect that fraud invalidates a judicial proceeding. There are general statements in the law that fraud vitiates a judgment. 30A Am.Jur. Judgments § 18. Our Supreme Court has declared that only extrinsic fraud, as contrasted with intrinsic fraud, will invalidate a judgment. Dockery v. Central Arizona L. & P. Co., 45 Ariz. 434, 45 P.2d 656 (1935); Schuster v. Schuster, 51 Ariz. 1, 73 P.2d 1345 (1937); Honk v. Karlsson, 80 Ariz. 30, 292 P.2d 455 (1956). Extrinsic fraud has been defined as such fraud as that by which '* * * the defrauded person has thereby been prevented from learning of the proceeding or asserting his claim therein * * *.' Honk v. Karlsson, 80 Ariz. 30, 33, 292 P.2d 455, 457.
It seems clear in this case that the fraud practiced by Lucy upon Clarabelle and the latter's six children was extrinsic fraud and thus of the nature entitling them to relief under the general rule. But because of the special nature of probate proceedings, there remains the question as to whether those victimized by this fraud are limited to an equitable action against the defrauding party to impress a constructive trust.
A probate is a proceeding in rem. A.R.S. § 14-301 et seq. As such, the decrees of the court, when entered within the ambit of its jurisdiction, are binding upon the world as to the res which is the subject of the proceeding. 50 C.J.S. Judgments § 910c(3), pp. 553-554.
The person seeking to sustain the validity of this particular order is free of guilt of any fraud and is one relying upon a record which on its face is devoid of any flaw insofar as the giving of notice is concerned. The probate record discloses that the hearing of the petition for letters was published as required by A.R.S. § 14-412 and that notice was given to the heirs 'named in the petition' as required by A.R.S. § 14-413.
In California, from whence most of our probate code derives (Shattuck v. Shattuck, 67 Ariz. 122, 192 P.2d 229 (1948)), the sole remedy of the person victimized by the type of fraud present in this case would be to bring an equitable action against the defrauding parties benefiting from the fraud. Nicholson v. Leatham, 28 Cal.App. 597, 153 P. 965 (D.C.A.2d 1915), hearing denied 28 Cal.App. 597, 155 P. 98 (Sup.Ct.Cal.1915); Security-First National Bank v. Superior Court, 1 Cal.2d 749, 37 P.2d 69 (Sup.Ct.Cal.1934); Farmers & Merchants National Bank v. Superior Court, 25 Cal.2d 842, 155 P.2d 823 (Sup.Ct.Cal.1945).
These California cases hold that the requirement that the heirs be named in the petition for probate is not jurisdictional, and that if the clerk mailed notice to the heirs named in the petition, as required by statut...
To continue reading
Request your trial