Ray v. Ray

• Decision Date: 22 June 1960
• Docket Number: No. 7835,7835
• Citation: 336 S.W.2d 731
• Parties: William T. RAY, Plaintiff-Respondent, v. Gloria Mae RAY, Defendant-Appellant.
• Court: Missouri Court of Appeals

Page 731

336 S.W.2d 731

William T. RAY, Plaintiff-Respondent, v. Gloria Mae RAY, Defendant-Appellant.

No. 7835.

Springfield Court of Appeals, Missouri.

June 22, 1960.

G. C. Beckham, Steeleville, J. Ben Searcy, Eminence, for defendant-appellant.

Granville L. Garblin, Clayton, William E. Seay, Salem, for plaintiff-respondent.

RUARK, Judge.

This case involves an accounting between husband and wife. Plaintiff husband, now respondent, sued his wife for divorce. Defendant wife filed a counterclaim wherein she alleged that plaintiff had taken and converted certain property and money which were jointly owned. Her prayer was for an accounting. On trial of the case the court granted decree of divorce to plaintiff, ordered custody of the only child of the marriage (a sixteen-year-old son) in the maternal grandmother, and gave judgment on defendant's counterclaim in accounting in favor of plaintiff. The wife has appealed from the judgment on her counterclaim. The propriety of the judgment for divorce is not in question.

At the outset we are presented with the question whether, certain personalty having been acquired by purchase with money drawn from a joint account of husband and wife, the action was premature. The contention is based upon the premise that, in the absence of evidence of any intention to the contrary, the property is to be presumed to be held by the entirety (Cullum v. Rice, 236 Mo.App. 1113, 162 S.W.2d 342; Glynn v. Glynn, Mo.App., 291 S.W.2d 190, 197; Hanebrink v. Tower Grove Bank & Trust Co., Mo.App., 321 S.W.2d 524; Feltz v. Pavlik, Mo.App., 257 S.W.2d 214; State Bank of Poplar Bluff v. Coleman, 241 Mo.App. 600, 240 S.W.2d 188; see 26 Am.Jur., Husband and wife, sec. 81, p. 712); and that, since the common law incidents remain, ¹ the action for accounting based on conversion of entirety property by one spouse as against the other creates friction with the fiction that each owns all. That is, one cannot be charged with converting his own property. In Smith v. Smith, 300 S.W.2d 275, we attempted to trace the development of the wife's right to sue her husband for conversion of her separate property but expressed some doubt as to whether she could sue, while still married, for conversion of entirety property. Now we are squarely confronted with the question, and so far as we have been shown or are able to find this is the first time it has ever been clearly presented to or decided by an appellate court in this state. ²

It has been held that property owned by entirety cannot be partitioned without consent of both spouses. Otto F. Stifel's Union Brewing Co. v. Saxy, 273 Mo. 159, 201 S.W. 67, L.R.A.1918C 1009. ³ But in Rezabek v. Rezabek, 196 Mo.App. 673, 192 S.W. 107, it was held that one spouse might have an accounting for the rents and profits from a leasehold held by the entirety; and in Prasse v. Prasse, Mo., 77 S.W.2d 1001, 1006, the husband was permitted to recover one-half the amounts taken from the joint account and used to improve the wife's property. In at least one case (Brooks v. Brooks, 357 Mo. 343, 208 S.W.2d 279, 4 A.L.R.2d 826), similar in some respects to the instant case, the court was able to allow an accounting by treating the husband and wife as joint adventurers.

Since we have held (Smith v. Smith, supra, 300 S.W.2d 275) that the wife may now maintain any character of action for the protection or recovery of her separate property, it would seem impractical to say that she must await divorce and then bring another action for the protection of the interest which is hers in an entirety property. ⁴ As to the objection based on public policy, it would appear that if the husband and wife are warring for the possession and use of entirety property the marriage schooner is already pretty well on the rocks. And theoretically we think the fiction of complete indivisible interests can be met on the hypothesis of agreement and acquiescence. Certainly a husband and wife can, by agreement, change the character and attributes of the estate (Stewart v. Shelton, 356 Mo. 258, 201 S.W.2d 395; Shackleford v. Edwards, Mo., 278 S.W.2d 775) or permit its destruction by acquiescence and consent. Zahner v. Voelker, Mo.App., 11 S.W.2d 63. As a matter of fact, whenever a portion of an entirety account is withdrawn for the personal use of one of the parties by the consent of the other, there is a change in the character of the ownership as to that part so withdrawn. See Harrellson v. Barks, Mo.App., 326 S.W.2d 351, 361; Ambruster v. Ambruster, 326 Mo. 51, 31 S.W.2d 28, 37, 77 A.L.R. 782; Feltz v. Pavlik, Mo.App., 257 S.W.2d 214, 218, supra. Ownership of personal property, unlike that of realty, is often transferred by informal act. If one of the parties takes the personal property to the complete denial of the other, he thereby in effect asserts that he denies the existence of an entirety title and has 'consented to or proposed' a destruction of the indivisible interest. In such a situation the spouse should have the option to accept and agree to such proposal of destruction and proceed to have her interest protected. ⁵ We think it now should be held that a spouse may maintain an action for accounting after a conversion of personal property owned by the entirety.

The facts in this case are complicated and confusing. The picture cannot be shown except by relating a generalized financial history of the parties.

Plaintiff and defendant were married in 1942 when he was twenty-three and she was seventeen. They separated in early December 1957. At the outset of the marital venture the parties had little in the way of material possessions, and the assets now in dispute were acquired in the fifteen years of their joint work and enterprise. Defendant was employed during the whole of this period, except for a brief time after the birth of the child of the marriage in the first year. We gather that she was perhaps more the 'pusher' of the two, although there is little dispute that the efforts of both contributed to the accumulation of the assets in controversy.

In 1950 the parties were living in St. Louis, he employed by General Motors Corporation and she at the Army Finance Center. They had already set up a joint savings account. In that year they moved to Licking, Missouri, and lived in a house with defendant's parents, a one-half interest in which the parties had purchased as tenants by the entirety. Both secured jobs at Fort Leonard Wood. Defendant was a civil service employee, and her gross salary soon exceeded that of the plaintiff. They had some money in their joint account, and after a time they decided to inaugurate a bus service between Licking and Fort Wood for the transportation of persons employed at the fort. We are convinced, without belaboring this phase of the history with details, that the Public Service Commission permit was obtained through their joint efforts (she assembling the data, et cetera), although the permit was issued in the husband's name. The first buses were purchased either directly or indirectly from the bank account of the parties. Some of the purchase money came from loans from defendant's parents which were later repaid from the joint account. As the business prospered, additional buses were added from earnings and joint assets, and although there is dispute as to some, we believe that titles to the buses were taken in their joint names. All moneys received and disbursed went through the joint account. Both continued in their jobs at Fort Wood and both worked to make the bus line a success. He serviced the buses and (presumably) drove one of them. For about a year defendant drove one of the buses and thereafter relieved other drivers on occasions such as vacations. She kept the records, made reports, saw to the insurance, collected the (weekly) fares, assembled income tax information, and generally did what may be called the office work. To this point there seems little question that the parties were both busily engaged in holding down their jobs at Fort Wood as well as in operating the bus line by joint effort and for a joint and unified family purpose.

In December 1956 they had an opportunity to purchase a half interest in a garage business in Cuba, Missouri, and they moved to that city. The business was purchased for a total of $15,000, and it was necessary to put in $5,000 as working capital. The purchase was made with one Brown, who, as copartner, supplied one-half the required $20,000. The Chevrolet franchise and the lease on the property, however, were taken in plaintiff's name alone. The Ray $10,000 which went into the business came, in the words of plaintiff, 'from what we had saved and we had it in St. Louis on interest and it was what we had saved.' They drew $7,000 from a savings account. Plaintiff left his job at Fort Wood and drew his 'retirement,' which was deposited in the joint account. Plaintiff says this amounted to 'about $500 or $600,' but defendant says it was $400. Plaintiff had payroll savings bonds, which he cashed for $795.49 and (presumably) put into the joint account. They borrowed some money from plaintiff's uncle and subsequently repaid him from the joint account. When they quit the bus business they had two buses and a carry-all which they later sold (at different times) for something in excess of $4,500. In the early part of 1957 they bought new furniture which cost $2,000. At some point (we are not sure when) they borrowed $1,800 or $1,900 from defendant's mother. Since the moneys went into and out of the joint account, it is impossible to say just what funds supplied all of the purchase of the garage business and what was applied to the purchase of furniture, but there is no question that both were acquired with the joint funds, which came from the combined earnings of the parties. Plaintiff testified that he did not know how the bill of sale to the garage was taken, but defendant said she later learned it was taken in the names of...