Plath v. Mullins

• Citation: 151 P. 811,87 Wash. 403
• Decision Date: 25 September 1915
• Docket Number: 12268.
• Parties: PLATH v. MULLINS et al.
• Court: United States State Supreme Court of Washington

151 P. 811

87 Wash. 403

PLATH v. MULLINS et al.

No. 12268.

Supreme Court of Washington

September 25, 1915

Department 2. Appeal from Superior Court, King County; Everett Smith Judge.

Action by F. B. Plath, as administrator, against Pat Mullins and others. Judgment for defendants, and plaintiff appeals. Reversed and remanded, with directions to enter judgment for plaintiff.

Wende &amp Taylor and E. B. Velikanje, all of North Yakima, for appellant.

H. J Snively, of North Yakima, for respondents.

MAIN J.

This action was brought by the plaintiff, as administrator de bonis non of the estate of A. W. Burnett, deceased. The purpose of the action was to have the equitable interest in certain real estate situated in Yakima county, Wash., subjected to the claims of creditors of the estate. The principal defense was that the interest in the land sought to be reached for the benefit of creditors was the separate property of Mrs. Burnett, wife of the deceased. The cause was tried to the court without a jury. The trial judge was of the opinion that the evidence established the fact that the interest in the property was the separate property of Mrs. Burnett, and entered judgment accordingly. From this judgment the plaintiff appeals.

The facts are as follows: Some time during the year 1891, A. W. Burnett and Josie Burnett were united in marriage, which relation continued until the death of A. W. Burnett, which occurred on June 4, 1910. At the time of the marriage, and for some years subsequent thereto, Mr. Burnett was engaged in the butcher business at Anaconda, Mont. Some time during the year 1897, the butcher business was discontinued. Thereafter, and in February, 1898, Mr. Burnett went to Alaska, where he remained for a period of approximately elghteen months. During the time Mr. Burnett was in Alaska, Mrs. Burnett conducted a restaurant at Anaconda. The restaurant business was disposed of some time during the year 1903, the business having been operated for a period of five years. The profits from this business amounted to $4,400.

In January, 1904, the Clarence Hotel at Butte, Mont., was acquired by Mr. Burnett, and was conducted thereafter for a period of approximately three years, when the hotel was disposed of. During the month of December, 1907, Mr. and Mrs. Burnett came to North Yakima and vicinity, and remained about two weeks. During this time they visited with Mr. Burnett's sister and her husband, a Mr. and Mrs. Nesley, After remaining at North Yakima for the time mentioned, the Burnetts returned to Butte, where the Braund Hotel was purchased, and was thereafter conducted until Mr. Burnett's death.

Some time during the month of February, 1908, Mr. Burnett returned to North Yakima, where he contracted to purchase from one William L. Lemon and wife 20 acres of land. The contract with Lemon was made with Mr. Burnett only; Mrs. Burnett's name does not appear in it. The contract for this land was executed on the 13th day of that month. The purchase price was $10,000, $3,000 of which was paid at the time the contract was executed and delivered. The balance, as provided in the contract, was to be paid $1,000 August 15, 1908; $2,000 February 15, 1909; $2,000 February 15, 1910; and $2,000 February 15, 1911.

While running the restaurant in Anaconda, Mrs. Burnett had money on deposit in her own name in the Hogue-Daley Bank of that city. This money was derived from the proceeds of the restaurant business. After moving from Anaconda to Butte, and on November 18, 1904, Mrs. Burnett opened an account in the State Savings Bank of that city. This account continued until March 19, 1910, when it was closed. From November 23, 1904, until August 10, 1910, Mrs. Burnett had money on deposit in her own name with Yegen Bros. Bank in Butte. On or about February 10, 1908, a check for $3,500, drawn by Mrs. Burnett on her account in the State Savings Bank, was received by the Silver Bow National Bank of Butte in exchange for a draft issued by that bank to A. W. Burnett. On February 13, 1908, A. W. Burnett indorsed to the Yakima Valley Bank of North Yakima, Wash., a draft for $3,500, issued by the Silver Bow National Bank to him. At the same time, Mr. Burnett opened an account with this bank and received credit for the amount of the draft. On February 14, 1908, the Yakima Valley Bank paid to A. W. Burnett, or to his order, $2,750. This $2,750 apparently went to Lemon, and was applied upon the first payment made upon the contract. Where the other $250 necessary to make up the $3,000 to meet this payment came from does not appear. During the month of March, 1910, the Yakima Valley Bank loaned to A. W.

Burnett and his wife $2,000, to secure which a note was given, and the contract with Lemon was assigned to the bank. On May 3, 1910, the $2,000 thus borrowed was paid by the bank directly to Lemon, and was applied upon the purchase price of the land. In addition to the $3,000 paid when the contract was executed, and the $2,000 borrowed from the bank and paid to Lemon, Mr. Burnett paid upon the contract the $1,000 due August 15, 1908, and the $2,000 due February 15, 1909. From what source the money which met these two payments last mentioned was derived does not appear. The only evidence upon the question is the testimony of Lemon that the payments were made by Mr. Burnett.

If the property purchased from Lemon became the separate property of Mrs. Burnett, it is by reason of the facts already stated and declarations made by Mr. Burnett during his lifetime. The evidence touching the declarations relied upon may be briefly summarized as follows: A. G. Burnett, a brother of A. W. Burnett, deceased, testified that, about ten days prior to the death of his brother, he had a conversation with A. W. Burnett, in which the latter said: That his affairs were in bad shape, but his wife had money of her own; that she had always taken her part out of the business; that the understanding between them was that Mrs. Burnett always took her part of the money or profit from the business, and it was her own personal property; that, if anything happened to him, his wife would have her ranch in Yakima; that the property in Yakima was his wife's, and bought with her money. This conversation, it should be noted, occurred approximately two months after A. W. Burnett had borrowed the $2,000 to make the payment upon the ranch due February, 15, 1910.

J. W. Nesley, a brother-in-law of A. W. Burnett, deceased, testified that while Mr. and Mrs. Burnett were in North Yakima for about two weeks in December, 1907, he heard Mrs. Burnett say to her husband: 'You know, Alex, that this is my money that is buying the ranch.' The witness did not remember Mr. Burnett's answer, but testified that the statement was not denied.

One C. P. Flannagan testified that he had a conversation with Mr. Burnett in the bar room of the Yakima Hotel upon one occasion when the latter was showing him some orchard views; and Mr. Burnett said that he wished the orchard were his, but that it was not, that it belonged to his wife, that she was using her money in the Yakima property, and he was putting his into mining.

A Mrs. Delia O'Neil, the wife of a brother of Mrs. Burnett, testified that she had frequently heard talks between the Burnetts touching business affairs, and that in these talks she heard Mr. Burnett say, after he returned from Alaska, that the profits of the restaurant business were his wife's; that before they moved to Butte she heard him say that his wife was loaning him $4,400 which he was going to pay back out of the profits of the Clarence Hotel business; that his wife was to have one-half of the profits out of this business; that she heard Mr. Burnett speak of the Yakima ranch property as his wife's.

From a reading of this witness' testimony as it appears in the statement of facts, it is very apparent that she was an ardent partisan of her sister-in-law. Referring to her testimony, the trial judge in his opinion said: 'I believe that she was not willfully falsifying, but painting the truth in glowing colors.'

The first question to be considered is whether, under the facts stated and the testimony bearing upon the declarations made by A. W. Burnett during his lifetime, the Yakima property became the separate property of Mrs. Burnett. The property was acquired during the marriage relation. It is a well-known rule that property acquired by purchase during the marriage is presumed to be community property, and that the burden rests upon the spouse asserting its separate character to establish his or her claim by clear and satisfactory evidence. Ballard v. Slyfield, 47 Wash. 174, 91 P. 642; Denny v. Schwabacher, 54 Wash. 689, 104 P. 137, 132 Am. St. Rep. 1140. In the Denny Case, it was said:

'Property acquired by purchase during marriage is presumed to

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