Mitchell's Estate, Matter of

• Citation: 610 S.W.2d 681
• Decision Date: 16 December 1980
• Docket Number: No. 40865,40865
• Parties: In the Matter of the ESTATE OF Frank W. MITCHELL, Deceased.
• Court: Court of Appeal of Missouri (US)

Page 681

610 S.W.2d 681

In the Matter of the ESTATE OF Frank W. MITCHELL, Deceased.

No. 40865.

Missouri Court of Appeals, Eastern District, Division Four.

Dec. 16, 1980.

Chopin & Kennedy, P.C., Francis H. Kennedy, Jr., and Joseph S. McDuffie, St. Louis, for Eugene N. Mitchell.

Gunn & Gunn by Donald Gunn, Jr., and Stein & Seigel by Charles Alan Seigel, St. Louis, for Betty Wilson.

SATZ, Judge.

This appeal arises from a suit to discover assets instituted by Betty Mitchell Wilson (petitioner) as administratrix of the estate of her deceased husband Frank W. Mitchell, Sr., (decedent). Petitioner initiated her action in the Probate Court of St. Louis County by filing an affidavit ¹ in which she stated that 19 shares of stock in the St. Louis Argus Publishing Company were unlawfully withheld from the estate by Eugene N. Mitchell (respondent), the son of decedent. At some point in the prehearing process, petitioner amended her affidavit to sue not only as administratrix but also "individually as the surviving spouse" of decedent. In answer to interrogatories filed by petitioner, respondent first stated he had received the stock as a gift from decedent. Subsequently, he amended his answers to these interrogatories to state that he had received the stock from decedent "in consideration" for his promise to take an active part in running the Argus Publishing Company. Ultimately, the cause was tried to a jury. The jury returned a verdict in favor of petitioner and found that "the 19 shares of stock in the St. Louis Argus Publishing Company are part of the estate of Frank W. Mitchell, Sr., deceased".

On appeal, respondent first contends the trial court erred in overruling his motions for directed verdict at the close of petitioner's case and at the close of the entire case. We disagree. By presenting evidence in his own case, respondent waived his right to appeal the adverse ruling on his motion for a directed verdict at the close of petitioner's case. Summers v. Sitze, 580 S.W.2d 562, 563 (Mo.App.1979); McCarty v. Donahue, 545 S.W.2d 359, 360 (Mo.App.1976). As to respondent's motion for a directed verdict at the close of the entire case, we must and we have reviewed all of the evidence and all reasonable inferences in the light most favorable to petitioner and we must and we have rejected all unfavorable inferences. Depper v. Nakada, 558 S.W.2d 192, 194 (Mo.App.1977); Forbis v. Associated Wholesale Grocer's Inc., 513 S.W.2d 760, 763 (Mo.App.1974). No useful purpose will be served by a detailed recitation of our marshalling of the evidence and inferences favoring petitioner. Suffice it to say that the evidence more than supports a case properly submissible to a fact finder.

Respondent also asserts several instructional errors. We find one of these assertions to have merit and we reverse. To understand respondent's specific assertion and the bases of our decision, we outline the procedural history of the present action.

A discovery of assets action, as its name implies, is a search for assets owned by the decedent at his death, and, thus, traditionally in these actions, the ultimate issue is whether title to the assets in question had passed from the decedent to another person prior to the former's death. E. g., Allmon v. Allmon, 306 S.W.2d 651 (Mo.App.1957); Edlen v. Tweed, 295 S.W.2d 397 (Mo.App.1956). In this context, the issue of the proper holder of title is considered to be an issue at law rather than equity. See, Kearney Commercial Bank v. Deiter, 407 S.W.2d 575, 581 (Mo.App.1966); In re Petersen's Estate, 295 S.W.2d 144, 146 (Mo.1956). Historically and by statute this legal issue rightfully may be tried to and resolved by a jury. See Tygard v. Falor, 163 Mo. 234, 63 S.W. 672 (1901); In re Van Fossen, 13 S.W.2d 1076 (Mo.App.1929); § 473.340 RSMo 1978. Implicit in the traditional procedure is a denial that there was an effective transfer of title from the decedent to another party. The issue of title is framed by the petitioner simply alleging that the decedent held title at his death to certain described property and that this property is being adversely withheld by another person. Section 473.340 RSMo 1978; See, § 462.400-462.440 RSMo 1949; Allmon v. Allmon, supra. The decedent's legal representative may initiate the action, and, once the initiating petitioner makes a prima facie showing that the decedent owned the property in question at his death, the burden of going forward and the burden of proof shifts to the respondent to show there was an effective transfer of the property from decedent to him. See, e. g., Allmon v. Allmon, supra at 655; Edlen v. Tweed, supra. Thus, traditionally but not universally, in a discovery of assets case, the legal representative of the decedent may be the petitioner, and the petitioner may raise the issue of title to the property in question as a matter of law, may demand a jury trial to resolve this issue and may make a submissible case by a prima facie showing of title in the decedent at the time of his death.

However, apparently because of the facts in the present case, petitioner did not choose to trod this precise procedural path. One of her theories of recovery, the one upon which she unquestionably submitted her cause to the jury, was that decedent transferred the stock to respondent and that transfer was a gift in fraud of petitioner's marital rights. We assume petitioner processed this cause of action as the surviving spouse of decedent rather than as his administratrix, because it is questionable whether as administratrix she has standing to set aside a fraudulent transfer by decedent. Stierlin v. Teschemacher, 333 Mo. 1208, 64 S.W.2d 647, 650 (1933); Kerwin v. Kerwin, 204 S.W. 922 (Mo.App.1918). In addition, we note that a gift in fraud of marital rights is an equitable cause of action, in which the aggrieved party normally seeks relief in equity rather than at law. E. g., Edgar v. Fitzpatrick, 369 S.W.2d 592, 599 (Mo.App.1963) modified on other grounds, 377 S.W.2d 314 (Mo.1964). Admittedly, today the probate divisions of our circuit courts appear to have wide ranging equitable power in probate matters. Section 472.030 RSMo 1978; In re Myer's Estate, 376 S.W.2d 219, 224 (Mo.banc 1964). Arguably, then, the discovery of assets process contemplates this substantive cause of action even though it is equitable in nature. See In re Estate of Lowe, 519 S.W.2d 373 (Mo.App.1975). Nonetheless, it still remains questionable whether a jury, other than an advisory jury, is the proper fact finder to resolve the ultimate issues raised by this equitable cause. ² See, State Bank of Willow Springs v. Lillibridge, 293 S.W. 116, 118 (Mo.1927); State ex rel. William v. Sloan, 574 S.W.2d 421 (Mo.banc 1978); Edward v. Maples, 388 S.W.2d 850, 852 (Mo.1965). Neither party has raised or addressed these procedural peculiarities and their possible effect on the substantive issues in this action. For our purposes here, we assume that petitioner, as a surviving spouse, may process the substantive cause of action of a gift in fraud of marital rights by a discovery of assets proceeding and that the issues raised may be properly resolved by a jury.

Against this procedural background, we now turn to respondent's assertion of instructional error. He contends the verdict director for petitioner, Instruction No. 2, was prejudicially erroneous. Petitioner's verdict director was submitted in the disjunctive. ³ It required the jury to find for petitioner if they found either (1) the shares of stock were not sold by decedent to respondent under a valid contract, or, (2) the stock had been a gift from decedent to respondent in fraud of petitioner's marital rights. Under this instruction, the jury could return a verdict for petitioner without finding that the decedent made a transfer intending to defraud the petitioner of her marital rights. A finding of no valid contract for the sale of stock would support a verdict for petitioner. This instruction, respondent argues, improperly eliminates petitioner's burden of proving her cause of action. We agree.

Petitioner's chosen theory of recovery was a gift in fraud of marital rights. Unquestionably, she had the burden of showing a fraudulent intent on the part of decedent. E. g., In re Estate of LaGarce, 532 S.W.2d 511, 515 (Mo.App.1975). The first paragraph of the verdict director in this case would have allowed the jury to find for petitioner without finding that she had carried her burden on this issue of intent. A verdict director must tell the jury each ultimate fact which must be determined in order for the jury to return its verdict. Douglas v. Hoeh, 595 S.W.2d 434, 437 (Mo.App.1980); Milliken v. Trianon Hotel Co., 364 S.W.2d 71, 74-75 (Mo.App.1962). The omission of the ultimate facts necessary to petitioner's claim made the instruction obviously misleading and confusing. See Douglas v. Hoeh, supra, R-Way Furniture Co. v. Powers Interiors, Inc., 456 S.W.2d 632, 639 (Mo.App.1970).

Petitioner argues that this is a discovery of assets case, and "these shares either belong in the estate ... or they do not". Because respondent justified his possession of the stock on the sole ground that he received them for valid consideration, petitioner reasons she is entitled to a verdict if the jury did not believe this contention. In short, petitioner argues the stock must be returned to the estate if there was a gift in fraud of marital rights or if respondent failed to support his justification for receipt and possession of the stock. Petitioner's argument does not cure the defective verdict director. Simply labeling this action as "discovery of assets case" does not eliminate the requirement that petitioner affirmatively establish the elements of a gift in fraud of marital rights. If this action can be construed as a discovery of assets case, it can be so construed only to the extent that the procedural devices for a discovery of assets were used to...