Reimche v. First National Bank of Nevada

• Decision Date: 25 February 1975
• Docket Number: No. 73-1740,73-1740
• Citation: 512 F.2d 187
• Parties: Marian F. REIMCHE, Plaintiff-Appellant, v. FIRST NATIONAL BANK OF NEVADA, Executor of the Estate of Marcus Daly, III, Deceased, and Candace Marie Daly, a minor, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 187

512 F.2d 187

Marian F. REIMCHE, Plaintiff-Appellant, v. FIRST NATIONAL BANK OF NEVADA, Executor of the Estate of

Marcus Daly, III, Deceased, and Candace Marie

Daly, a minor, Defendants-Appellees.

No. 73-1740.

United States Court of Appeals, Ninth Circuit.

Feb. 25, 1975.

Ralph M. Crow (argued), of Ross & Crow, Carson City, Nev., for plaintiff-appellant.

Melvin D. Close (argued), of Jones, Jones, Close, Bilbray, Kaufman & Olsen, Las Vegas, Nev., for defendants-appellees.

OPINION

Before LUMBARD, ^* KOELSCH and WRIGHT, Circuit Judges.

EUGENE A. WRIGHT, Circuit Judge:

Plaintiff-appellant, a California resident, sought in this diversity action specific performance of a contract to make a will allegedly entered into between her and the late Marcus Daly III. Joined as defendants were the corporate executor of Mr. Daly's estate, his wife at the time of death and a daughter, alleged to be the child of the plaintiff by Mr. Daly. The district court dismissed the amended complaint on motion of the appellees on the ground that it failed to state a claim. We reverse.

For purposes of review, we must taken as true the facts as alleged in the amended complaint; Walling v. Beverly Enterprises, 476 F.2d 383 (9th Cir. 1973). Appellant alleged that she and the decedent were involved in an adulterous relationship in 1954 while both were married to other persons. Appellant had been abandoned by her husband during this period. She supported two small children, a sister, and a widowed mother in California by working as a waitress in Reno, Nevada. An alleged promise of marriage by the decedent was withdrawn because of his inability to obtain a satisfactory property settled with his then wife.

Appellant moved to California at decedent's request when they learned that she had become pregnant by him. The decedent allegedly supported her and provided for his medical costs during the pregnancy. Before the birth, decedent asked that the appellant consent to his adoption of the child, not seek to regain custody, the remain silent about the parentage of the child during his lifetime. In return, the decedent allegedly promised to rear, support, educate and maintain the child,

leaving to the child and the Plaintiff all of his estate the same as if they were married, or in the alternative, leave all of his estate to the child and the Plaintiff, and any widow who survived him, other than the Plaintiff.

Amended complaint, CR 126.

The appellant acceded to this arrangement and the decedent subsequently adopted the child and provided for her in his will. He made no provision for appellant, however.

The district court dismissed the amended complaint, holding that it was against public policy to enforce a contract by the father of an illegitimate child to provide for the mother in his will if the contract was incident to an adoption agreement. This decision was based on a misinterpretation of the case law relating to public policy in this area.

There are not Nevada statutes or cases indicating state policy with respect to the propriety of such a contract. Contracts to make a will, however, are permitted, Waters v. Harper, 69 Nev. 315, 250 P.2d 915 (1952). But Nevada statutes do recognize the distinction between adoption agreements involving the natural parents of the child and those involving third parties. Parents placing their own children are exempt from the licensing requirements necessary for persons who place children for adoption, N.R.S. 127.240(1) and from criminal sanctions for receipt of compensation by unlicensed persons arranging for the placement of children, N.R.S. 127.300(2). Mothers of illegitimate children are permitted to agree on support arrangements by putative fathers, N.R.S. 126.280.

The Nevada case relied upon by the district court is inapposite. In Las Vegas Sun v. Franklin, 74 Nev. 282, 329 P.2d 867, 872 (1958), the court in a libel action held that there was no proof of the "black-market sale" of a child "in the absence of proof of a sale price or profit ..." The basis of the alleged libel was the placement of the child with an unrelated person for adoption. The case is not precedent in a situation involving an adoption agreement between the natural parents of an illegitimate child. Moreover, the decision did not relate to circumstances in which there was other consideration for the payment besides mere consent to the adoption by the mother.

No decisions in other jurisdictions involving similar facts have been discovered. Some principles can be gleaned from cases in related areas.

Courts have upheld support agreements between the natural parents of illegitimate children based on consideration provided by the mother's forbearance from instituting filiation proceedings. Schumm v. Berg, 37 Cal.2d 174, 231 P.2d 39 (1951), Peterson v. Eritsland, 69 Wash.2d 588, 419 P.2d 332 (1966), 20 A.L.R.3d 512 § 4. Here the plaintiff necessarily surrendered all support rights against the decedent by permitting the adoption and remaining silent about her daughter's paternity rather than instituting a filiation proceeding.

Similarly, courts have approved contracts to devise between parents of illegitimate children based on the mother's forbearance from instituting filiation proceedings and consent to adoption, Redmon v. Roberts, 198 N.C. 161, 150 S.E. 881 (1929); Smith v. Wagers' Administrators, 238 Ky. 609, 38 S.W.2d 685 (1931).

Other courts have upheld adoption agreements between parents of illegitimate children, permitting the children to share in the fathers' estates despite a lack of formal adoption proceedings, and holding that the mothers' surrender of the children provided valid consideration for the contracts. Doty's Administrators v. Doty's Guardian, 118 Ky. 204, 80 S.W. 803 (1904); Couch v. Couch, 35 Tenn.App. 464, 248 S.W.2d 327 (1951).

The courts in Georgia have prohibited adoption agreements involving some financial benefit to the mother where the adoptive parent was not the natural parent of the child. Downs v. Wortman, 228 Ga. 315, 185 S.E.2d 387 (1971); Savannah Bank and Trust Co. v. Hanley, 208 Ga. 34, 65 S.E.2d 26 (1951). Courts in other jurisdictions have permitted mothers to regain custody of their children after agreeing to surrender custody to third parties, Walker v. Williams, 214 Miss. 34, 58 So.2d 79 (1952); In re Guardianship of Fox, 212 Or. 80, 318 P.2d 933 (1957).

In a case closer to our facts, the Supreme Court of Kansas in In re Shirk's Estate, 186 Kan. 311, 350 P.2d 1 (1960), upheld an oral contract in which the adoption of a child by its grandmother was conditioned on granting both the child and its mother a one-third interest in the grandmother's estate. The court, citing 39 Am.Jur., Parent and Child, § 30, held that

a contract, whether an adoption contract or merely an agreement for the transfer of the custody of the child, is not (against public policy) merely because it provides for the surrender by a parent of his child to another in consideration of the latter's promise to give or leave money or property to the parent or to the child, where it appears that the contract is in fact one which is promotive of the welfare and best interests of the child, and especially where the parent is not in a position to furnish proper care for the child and the promisor is able and fit to perform the obligation.

350 P.2d at 11.

The court distinguished the case in which the child was surrendered for adoption to a stranger, holding that the "instant case involves a family compact." 350 P.2d at 12.

The court in Shirk's Estate also found significant the facts that the adoption request was initiated by the grandmother, including the promise of a share of her estate, that it was not prompted by self-seeking on the part of the mother, and that the "controlling consideration" was the welfare of the child, id. See also Clark v. Clark, 122 Md. 114, 89 A. 405 (Ct. of App. 1913) and Enders v. Enders, 164 Pa. 266, 30 A. 129 (1894). Although the court noted that the mother already had a right to share in the grandmother's estate by intestate succession, this seems rather meaningless since implicit in the offer of a share in the estate was the prospect of explicit disinheritance.

The court found additional support for the agreement in the fact that the mother had surrendered "the control, custody, and daily companionship of her daughter. She lost the privilege of watching her grow and develop and the love and affection of the child for her was lessened." 350 P.2d at 9.

We conclude then that it is not against public policy to enforce an agreement to provide for the mother of an illegitimate child in the putative father's will, incidental to an agreement to permit the adoption of the child by its father, where the adoption was in the best interests of the child and pecuniary gain was not the motivating factor on the mother's part. The fact that the agreement was not initiated by the mother is evidence of the motivation behind the agreement.

Here the appellant alleges that she was in dire financial straits and had been abandoned by her husband while the decedent offered the prospect of a stable home and a secure financial position. She alleges further that she accepted the agreement offered by the decedent only when a prior offer of marriage was withdrawn by him. The appellant incurred a significant detriment by foregoing her right to child support through filiation proceedings, relinquishing the companionship and affection of their child as well as any financial compensation she might have obtained from her daughter's earnings during minority and her support obligations thereafter.

Since there is no Nevada public policy apparent from its statutes and case law, it was error for the district court to find that Nevada would reject the majority rule with respect to a compact between parents such as this. The fears that approval of such a policy would lead to the bartering or sale of children are not...