Phillips v. Butler

• Decision Date: 27 April 1889
• Citation: 11 S.W. 479,51 Ark. 351
• Parties: PHILLIPS v. BUTLER
• Court: Arkansas Supreme Court

11 S.W. 479

51 Ark. 351

PHILLIPS v. BUTLER

Supreme Court of Arkansas

April 27, 1889

APPEAL from Pulaski Chancery Court, D. W. CARROLL, Chancellor.

Decree reversed and cause remanded.

T. J Oliphint, for appellant.

A trust will not result to one who pays a part only of the consideration of land conveyed to another, unless it be some definite part of the whole consideration. 2 Paige, 238; 15 Wend. 647. Under no circumstances will a resulting trust be greater than the part of the consideration paid. Hill on Trustees, 144; 7 B. Mon., 433; 9 Paige, Chy., 334; 4 J. J Marsh., 590; 6 Cowen, 706; 35 Me. 41; 14 Ill. 505.

The claim is stale. 41 Ark. 301. Lapse of time and laches will bar a recovery. Courts do not enforce stale claims. Perry on Trusts, sec. 140; 6 Whart., 481; 1 Hare., 594; 2 Story Eq Jur., secs. 15-20; 21 Ark. 9.

The court erred in divesting the title. Conceding appellee's claim, the most she could possibly recover would be the $ 149 and legal interest. The U. S. government having decided that appellant was entitled to the bounty money as the brother of the deceased soldier, that decision cannot be attacked in a collateral proceeding.

The testimony was clearly insufficient to show that appellee was the wife of the deceased soldier.

Certainly there was no trust beyond the $ 149 used by appellant in the purchase of the lot. Hill Trustees, 4th Am. ed., 149; 2 John Chy., 416.

Blackwood & Williams, for appellee.

That appellant was a trustee is beyond doubt. By representing himself to the government as the heir, he put himself in a fiduciary or trust relation to the rightful person. This was a fraud and he became a trustee ex maleficio. Bispham Eq., sec. 218; Hill on Trustees, 144.

If appellant mingled trust funds with his own and failed to keep account of the rents and profits, so they could be separated, it was proper for the chancellor to divest him of the whole. The burden was on him to separate the trust fund and its increase from his own. Bisp. Eq., sec. 86, [3d ed.]; 1 Perry Trusts, sec. 128; 14 Ill. 505; 34 L. J. Ch., 301; 4 De G. M. & G., 372; L. R. 11 Chy. Div., 772; L. R. 13 Ch. Div., 128; 10 John., 65; 51 Me. 402; 1 Story Eq., sec. 468; 2 Kent, 364.

The statute of limitations was not pleaded.

The widow was entitled to the bounty. Act July 4, 1864, XIII. St. at Large, 379; Rapps. Dig. Bounty Laws, sec. 469.

OPINION

BATTLE, J.

Edward Johnigan enlisted in the army of the United States during the late war between the States, and died in the service, and before the close of the war. At the time he enlisted he had a wife, Clarissa by name, and when he died he left her surviving. He also had a brother Jacob, who survived him. In 1871 Jacob, without the knowledge, consent or authority of his brother's widow, collected from the United States $ 149.52 as bounty due his brother Edward, and invested it in a certain lot in Little Rock, which he purchased, and which cost him $ 400. Clarissa married one Butler. Having discovered Jacob's collection and investment, they brought this action to divest him of the title to the lot, and to vest it in Clarissa, or to recover a decree for the amount collected in favor of Clarissa, and to have it decreed a lien on the lot and the lot sold to satisfy the same.

The amount due Edward as bounty at the time of his death rightfully belonged to his widow. There is no controversy about Jacob having collected it, or the amount collected; and we think that the evidence clearly shows that he invested it in the lot. But it is insisted that he stood in no fiduciary relation to Clarissa, and that when he collected the money due her, and invested it in the town lot, no trust resulted to her. It is true that he stood in no relation of confidence or trust to her. But it is not necessary that such a relation should have existed to entitle her to relief against the lot. Equity created a trust in invitum out of the collection and the investment of her money in the lot, with the view of subjecting the lot to the purposes of indemnity and recompence.

"One of the most common cases," says Judge Story, "in which a court of equity acts upon the ground of implied trust in invitum, is where a party receives money which he cannot conscientiously withhold from another party." And he states it to be a general principle that "whenever the property of a party has been wrongfully misapplied, or a trust fund has been wrongfully converted into another species of property, if its identity can be traced, it will be held in its new form liable to the rights of the original owner, or the cestui que trust." Story's Eq. Jur., secs. 1255, 1258.

In 2 Pomeroy's Equity Jurisprudence, the author says: "In general, whenever the legal title to property, real or personal, has been obtained through actual fraud misrepresentations, concealments or through undue influence, duress, taking advantage of ones necessities or weakness, or through any other similar means or under any other similar circumstances, which render it inconscientious for the holder of the legal title to retain and enjoy the beneficial interest, equity impresses a constructive trust on the property thus acquired in favor of the one who is truly and equitably entitled to the same, although he may never perhaps have had any legal estate therein; and a court of equity has jurisdiction to reach the property either in the hands of the original wrong-doer, or in the hands of any subsequent holder, until a purchaser of it in good faith and without notice acquires a higher right and takes the property relieved from the trust. The forms and...