Musser v. General Realty Co., 46223

• Decision Date: 14 April 1958
• Docket Number: No. 46223,No. 1,46223,1
• Citation: 313 S.W.2d 5
• Parties: Dorothy MUSSER, Plaintiff-Respondent, v. GENERAL REALTY COMPANY, Inc., a Corporation, Defendant-Appellant
• Court: Missouri Supreme Court

Page 5

313 S.W.2d 5

Dorothy MUSSER, Plaintiff-Respondent, v. GENERAL REALTY COMPANY, Inc., a Corporation, Defendant-Appellant.

No. 46223.

Supreme Court of Missouri, Division No. 1.

April 14, 1958.

Rehearing Denied May 12, 1958.

Cliff H. Bailey, Kansas City, for defendant-appellant.

Francis L. Roach, Solbert M. Wasserstrom, Dean C. Allard, Kansas City, for respondent.

VAN OSDOL, Commissioner.

Defendant has appealed from a decree by which title in defendant by virtue of an absolute deed to Lot 18, Adler's High View Addition, Jackson County, executed by plaintiff and her former husband, grantors, to defendant, grantee, was subjected to a constructive trust and the equitable interests of the parties, plaintiff and defendant, were ascertained and determined.

Plaintiff had alleged that she was the owner of the described real estate which was subject to a lien securing the payment of $7,200; that defendant, in order to induce plaintiff to vest title in defendant and with the express understanding and agreement that the property was to be held in trust for the respective interests of plaintiff and defendant, contracted with plaintiff to finish the incomplete improvements at a cost of not to exceed $2,500 and to sell the completely improved property at a price agreeable to both parties, the profit from the sale to be equally divided between plaintiff and defendant; that, relying upon such understanding and agreement, plaintiff executed and delivered to defendant a deed, dated June 14, 1955; and that defendant has now refused to recognize plaintiff's interest in the property.

Defendant by answer alleged that plaintiff's petition failed to state a claim upon which relief could be granted; pleaded the Statute of Frauds, Section 432.010 RSMo 1949, V.A.M.S.; and further alleged that plaintiff and her former husband had executed and delivered the deed of June 14, 1955, as an absolute conveyance to defendant, the consideration being that defendant was to assume the stated encumbrance and satisfy other obligations owing by plaintiff and her former husband.

Defendant-appellant has stated that the principal questions presented herein upon appeal are whether the petition states a claim on the theory of a trust and, if so, whether the trial court's decree engrafting a constructive trust was supported by the evidence; and whether the judgment is responsive to the pleadings and the evidence.

On and before June 14, 1955, plaintiff was the wife of Marion Thomas Downen. Title to the described property was vested in them jointly, but subject to an encumbrance of $7,200. At the time, plaintiff and her husband were estranged, and plaintiff was divorced from Downen July 8, 1955. Plaintiff was married to her present husband, Musser, November 25, 1955. Defendant is a corporation engaged in handling real estate, of which corporation one Harper is an officer and one of the principal stockholders. June 14, 1955, the property was conveyed by plaintiff and her husband Downen to defendant by warranty deed reciting the consideration of 'one dollar and other Valuable Considerations.'

Plaintiff testified that she had used her own funds in buying the property, and that none of the purchase price had been contributed by her former husband Downen. When she bought the property the improvements consisted of a 'sub-floor on the basement of a home to be completed later.' A loan, originally $7,500, secured by deed of trust, was procured, and out of the money borrowed and by the use of her own funds, plaintiff continued in improving the property and on June 14, 1955, there remained the work of constructing a garage, a breezeway, drains and a basement wall; and the work of decorating the interior. Plaintiff considered she had a $2,500 'equity' in the property.

Plaintiff further testified that Harper who, as stated, is an officer of defendant corporation, called on her at her place of employment. Harper, who had introduced himself as a personal friend of her husband Downen, was apparently familiar with the property and the progress of the work in completing the improvement thereon. Harper represented that it would take no more than $2,500 to complete the improvement, and stated that he would like to take over the house and complete it. He said he could and would finish the house in not more than six weeks at a cost of not to exceed $2,500, and would put it up for sale immediately. He would allow plaintiff $2,500 for her 'equity' and one half of the profit, or excess over the $2,500 equity and $2,500 cost of completing the improvement. Harper interviewed plaintiff at least three times, asking her to enter into the arrangement; and, as we have said, June 14th plaintiff and her husband joined in the conveyance to defendant.

Plaintiff said she signed the deed at the home of her mother. Harper had brought the instrument there. It already bore the signature of the husband. When she signed, plaintiff asked Harper, 'How will I be assured that I will be entitled to half the profit after the house has been completed * * *?' Harper replied, 'I will bring you a paper stating that you will be entitled to half the profit over and above the costs.' He said he would bring the paper in a day or two. This testimony was corroborated by the testimony of plaintiff's mother who said she was present and heard the conversation concerning the conveyance and agreement. Plaintiff's testimony was also in part corroborated by the testimony of her employer, who had overheard Harper speak with plaintiff during one of the two or three interviews between plaintiff and Harper at the employer's place of business. The employer said he heard Harper speak 'regarding some real estate deal (about a house) and he (Harper) said something about bringing an agreement in two or three days.'

After signing the conveyance, plaintiff several times made inquiry as to the progress in completing the improvement. Harper assured plaintiff that it was coming along 'just fine.' In January 1956, plaintiff saw an advertisement of sale of the property, and called Harper to ask the price at which it was held for sale. She also inquired about the 'piece of paper stating I was entitled to half of the profit. * * * He told me if he ever tole me he was going to give me half the profit he didn't mean it, he wasn't going to.'

On the other hand, Harper testified that he had made all arrangements for taking over the property with plaintiff's husband Downen who had importuned defendant to 'take the house over for what was against it; that he was being sued; that he was going to lose the place anyway, and wanted to save his credit and name and everything, and wanted me to take it over.' The witness Harper and another of defendant's stockholders examined the property and agreed with plaintiff's husband Downen that 'we would take it over if that was all right with him.' The testimony of plaintiff's husband Downen supported Harper's version. (We have noted that the trial court in its findings and decree recited and declared that the former husband has no interest in the property, although the husband was not a party to the action. We suppose the trial court was considering the facts that the husband admittedly had joined in the conveyance to defendant and, in testifying at the instance of defendant and in its behalf, the husband disclaimed any interest in the property.)

Harper further testified that plaintiff twice called him by telephone asking the selling price of the house. In the first instance, plaintiff wanted to get 'the place back.' He told her the price was $14,500. She called again 'in January and said she couldn't give that. She talked like she might give $12,500 for it and said if you don't pay me my equity she said she would sue. * * * I told her 'just sue and be damned."

There was evidence that defendant had paid out $2,308.07 for materials and labor in completing the improvement. Defendant also claimed $3,042 as the value of labor said to have been performed by Harper and another of defendant's stockholders, personally, in working on the building. The trial court allowed defendant $2,500 for expenditures toward completing the improvements, and allowed defendant other sums expended in paying an obligation incurred by plaintiff and her former husband in purchasing storm windows and doors, and for installments on the loan, taxes and insurance theretofore and thereafter to be paid by defendant.

In examining the petition we have noted the allegation that plaintiff conveyed on the strength of defendant's agreement and there is no allegation of a confidential or fiduciary relationship existent between the parties and no specific allegation of facts, which if supported by evidence, would amount to fraud. The petition, strictly construed, merely avers that defendant refuses to recognize plaintiff's interest in the property. However, the petition does aver that, in order to induce plaintiff to vest title in defendant, defendant had agreed to hold the property in trust and complete the improvement and sell and divide the profit; and, as stated, that defendant has refused to recognize plaintiff's interest. We think that the petition, liberally construed and fully given its fair intendment, was sufficient in justifying the admission of evidence tending to show that defendant, when the agreement was made, had no intention of performing it. And the evidence introduced by plaintiff, which we have set forth, supra, went in without objection, except a general objection 'to any evidence being offered' at the beginning of the trial. We consider the petition as if amended to conform to the proof, and sufficient....