Patterson v. Bowes

• Decision Date: 10 March 1914
• Citation: 139 P. 225,78 Wash. 476
• Court: Washington Supreme Court
• Parties: PATTERSON v. BOWES et al.

139 P. 225

78 Wash. 476

PATTERSON v. BOWES et al.

Supreme Court of Washington

March 10, 1914

Department 1. Appeal from Superior Court, King County; Boyd J. Tallman Judg.

Action by E. O. Patterson, as receiver of the Nye & Ormsby County Bank, against Edward Bowes and wife and another. From the judgment, plaintiff appeals. Reversed, with directions.

E. H Guie and J. A. Guie, both of Seattle, for appellant.

John L Rockwell, Chas. F. Riddell, and Edwin C. Ewing, all of Seattle, for respondents.

GOSE J.

On the 31st day of January, 1907, the respondent Edward Bowes and one Effinger executed to the Nye & Ormsby County Bank of the state of Nevada their joint and several promissory note for the sum of $33,339.36, payable upon demand. At the same time the makers each deposited with the bank as collateral security 9,000 shares of mining stock. The bank was given authority to sell the stock with or without notice, either at public or private sale. The stock was sold and applied. This action was brought to recover the balance due upon the note. Ancillary to the suit, certain real estate situated in the city of Seattle, and standing of record in the name of the respondent Ada F. Bowes, was attached, upon the theory that it is the community property of the respondents Ada F. Bowes and her husband, Edward Bowes. A personal judgment was entered for the balance due upon the note in favor of the receiver of the payee bank and against the respondent Edward Bowes 'and the community composed of the said Edward Bowes and Ada F. Bowes, his wife,' and the attached property was adjudged to be the separate property of Mrs. Bowes. The receiver has appealed from that part of the judgment fixing the status of the property. It is admitted that the debt is a community obligation. The single question presented by the appeal is whether the attached real estate is community or separate property.

The theory of the case presented by the respondents at the trial is that in November or December, 1904, the respondent husband made a gift of between $30,000 and $40,000 to his wife, and that the attached property represents the gift and its proceeds. The presumption is that all property acquired during the existence of the marital relation is community property, and this presumption obtains when the legal title is in the name of the wife, as well as when it is in the name of the husband. Rem. & Bal. Code, § 5917; Weymouth v. Sawtelle, 14 Wash. 32, 44 P. 109.

Under our statute (Rem. & Bal. Code, § 5292) the gift was presumptively fraudulent as against creditors, and the burden was on the respondents to overcome this presumption by clear and convincing evidence. Liebenthal v. Price, 8 Wash. 206, 35 P. 1078; Kemp v. Folsom, 14 Wash. 16, 43 P. 1100; Bates v. Drake, 28 Wash. 447, 68 P. 961; Canedy v. Skinner, 50 Wash. 501, 97 P. 497; Dill v. Carver, 70 Wash. 103, 126 P. 86.

The material question is, Have the respondents overcome these legal presumptions? The respondents were married in 1892. The testimony shows that the wife was then a widow and possessed of a small estate. There is no evidence, however, that any part of this estate or its avails went into the Seattle property. The respondent husband operated as a promoter of mines and mining stock, and in dealing in mining stock in the state of Nevada from March, 1902, until some time in 1907. He testified that in November or December, 1904, he gave his wife $32,000 or $33,000 in drafts or checks, and that he had no interest in the property in controversy. However, after the commencement of the action he made an affidavit in support of the motion of Mrs. Bowes to dissolve the attachment, in which he referred to her estate at the time of her marriage, and in effect said that the property in controversy was purchased with the proceeds of this estate making no reference at all to the alleged gift. It is obvious that, if he had made the gift in 1904 or 1905, the fact would have occurred to him at the time he made this affidavit. The amount of the alleged gift is large, and it is incredible that it should have escaped his attention at that time. On the 20th day of August, 1907, he conveyed the property in controversy to his wife by a deed of quitclaim. On his direct examination he testified that, at the time of making that conveyance, he was free from debt; that the note was supposed to have been paid. He also testified that he did not know who made the payments on the note. In opposition to this testimony the appellant produced statements taken from his (Bowes) private box in the state of Nevada, which showed that the bank had sold the collateral security and rendered him an itemized account of the sales. He testified that he had never seen this statement. His evidence given at the trial is much weakened by the fact that it runs counter to his affidavit and to the statements found in his private box. The wife testified that in November or December, 1904, at a time when she was ill in the city of Seattle, her husband gave her checks or drafts for $35,000 or $40,000, they alone being present; that she did not know by whom the checks or drafts were drawn or upon what bank; that at some time, the exact time not appearing, she deposited $2,000 of the checks in the First National Bank of Seattle; that she deposited the larger check--some $30,000 or $32,000--in some bank in the city of San Francisco; that she does not know in what bank she made the deposit, and she does not know its location. She was asked whether she had $40,000 or $45,000, and answered, 'I can't remember.' She further testified that she had never seen or had so large a check before; that she had no bank books at the time of the trial and no checks and no written evidence of any of the deposits, and that she did not know where her bank books were. She was asked, 'Where did you have the $30,000 deposited?' and answered, 'I don't remember which one of the...