Rozan v. Rozan

• Decision Date: 01 June 1964
• Docket Number: No. 7951,7951
• Citation: 129 N.W.2d 694
• Parties: Alice F. ROZAN, Plaintiff and Appellant, v. Maxwell M. ROZAN, also known as M. M. Rozan, and also known as M. R. Maxwell et al., Defendants and Respondents, and Herbert T. Silverberg, Intervenor and Appellant.
• Court: North Dakota Supreme Court

Page 694

129 N.W.2d 694

Alice F. ROZAN, Plaintiff and Appellant, v. Maxwell M. ROZAN, also known as M. M. Rozan, and also known as M. R. Maxwell et al., Defendants and Respondents, and Herbert T. Silverberg, Intervenor and Appellant.

No. 7951.

Supreme Court of North Dakota.

June 1, 1964.

Syllabus by the Court.

1. In North Dakota a divorce action is regarded as a proceeding quasi in rem, the res being the marriage status.

2. North Dakota will accord full faith and credit to a judgment and decree of divorce rendered by a court of another state insofar as that court within its jurisdiction limitations affected the marital status of the litigants.

3. The courts of another state cannot by judgment or decree directly affect or transfer title to real property situate in North Dakota.

4. A valid decree in personam of one state may determine the equities of litigants to lands in another state, and may order and compel conveyance thereof and thus indirectly affect or transfer title to land situated beyond the territorial jurisdiction of the decreeing state, and it is the executed conveyance and not the decree that is operative upon such title.

5. That portion of a foreign judgment purporting by its own operational force to directly transfer title of lands located in North Dakota, without personam enforcement by the litigants thereof, is a nullity and will not be accorded full faith and credit.

6. For divorce purposes, personal property acquired during the continuance of the marriage is governed by the law of the domicile of the parties.

7. The finding of fact in a valid judgment by a court of California, such being the domicile of the parties, that community property funds were used to acquire real property situated in North Dakota is entitled to full faith and credit, is res judicata, and is conclusive upon the parties, and such use of these funds constitute the owners thereof owners in common of the so acquired North Dakota real properties.

8. Use of community property funds of husband and wife, by husband with wife's consent, to acquire in his own name real property in North Dakota, gives rise to an implied trust whereby one-half of the so acquired real property is held in trust for the wife, and subsequent transfer by the husband of such acquired real property to one who is not a purchaser in good faith and for value does not divest the trust identity.

9. Where a foreign judgment does not purport to be a final disposition of an issue of fraudulent conveyance of land situate beyond the territorial jurisdiction of that court, such judgment is not res judicata.

10. A party attacking a conveyance as fraudulent must prove such issue by evidence that is clear, substantial and convincing.

11. To set aside a conveyance as fraudulent, the requisite fraudulent intent must exist at the time of transfer, and proof of subsequent events or intent is insufficient.

On Rehearing

12. An action to set aside conveyances and transfers of interests in real property is maintainable by a divorced wife when such are made with intent to hinder, delay and defraud her of property interests or to defeat anticipated alimony and other marital allowances.

13. Proof of participation by the grantee under a deed or other transfer of real property in a fraudulent conveyance is sufficient where it is shown that the grantor fraudulently transferred such property and that the grantee knew at the time of transfer that the grantor's intent therein was to hinder, delay or defraud his creditors.

14. Actual knowledge by the transferee of suspicious facts and circumstances as should put a prudent person on inquiry is equivalent to knowledge of all facts which would be developed by reasonable inquiry.

15. Unexplained absence during trial by a party defendant and consequent failure to testify gives rise to an inference unfavorable to such absent party which, while not conclusive, may be considered with all other evidence in determination of the case.

16. Deposition testimony to be admissible must be relevant and material.

17. Testimony of a party given in an earlier trial may be admitted as evidence of an admission against interest.

18. A person merely holding title to land for another and being responsive to the instructions of the latter is not an indispensable or necessary party to this action, nor is it necessary to prove his participation in the fraud.

19. Evidence examined, and for reasons stated in the opinion it is held the transfers of land were fraudulent and are therefore void.

20. California judgments bear interest at the legal rate of that State from time of entry of judgment, and upon such judgments being made domestic judgments of this State, bear interest at North Dakota's legal rate.

21. A wife's separate property is not liable upon execution for a husband's separate tort judgment debt.

Bjella, Jestrab & Neff, Williston, for Herbert T. Silverberg, intervener and appellant.

William S. Murray, Bismarck, Gustave L. Goldstein, Beverly Hills, Cal., and Bjella, Jestrab & Neff, Williston, for Alice F. Rozan, plaintiff and appellant.

E. J. McIlraith, Minot, for Maxwell M. Rozan, defendant and respondent.

Jansonius, Fleck, Smith, Mather & Strutz, Bismarck, for Lee McCormick and Jessie McCormick, defendants and respondents.

Walter O. Burk, Williston, and Stanley B. Frosh, Washington, D. C., for Eugene D. Rosen, defendant and respondent.

Cox, Pearce & Engebretson, Bismarck, for Stanolind Oil Purchasing Co., defendant and respondent.

DOUGLAS B. HEEN, District Judge.

Plaintiff instituted this action upon a judgment and decree of divorce rendered by the courts of California, and Herbert T. Silverberg, the intervenor, is a judgment creditor of defendant Rozan and by way of intervention in the instant suit seeks to enforce a money judgment obtained in the State of California.

Being considered and determined in this opinion are two separate appeals, plaintiff Alice F. Rozan and intervenor Silverberg both having appealed from a judgment of the District Court of Williams County, North Dakota, and from an order of that court denying a motion for a new trial, and both appellants in this Court demand trial de novo.

Plaintiff Alice F. Rozan, sometimes referred to as A. F. Rozan, and defendant Maxwell M. Rozan, also known as M. M. Rozan and M. R. Maxwell (designated hereafter as 'Rozan' for purposes of this opinion), were married at Monroe, Michigan, in 1927, subsequently residing for varying periods of time in Colorado and in at least one other State. One child, John Elias Rozan, was born to their marriage.

In August of 1948, plaintiff and Rozan rented a dwelling in California, and it is apparent from the record that these parties then did not own other property of consequence. The Rozans in July, 1949, entered into a contract for the purchase of a home in California. In the same year, Rozan was a patient in a Veteran's Administration hospital in California, and subsequently, because of disability, need and lack of resources, made application for a veteran's pension with the Veteran's Administration.

Rozan in 1951, using borrowed money came to North Dakota and acquired by deed or lease certain mineral interests, receiving such largely in his name although certain acreage was taken in the name of the plaintiff. Among such properties so acquired was certain mineral acreage which for the purposes of this action are referred to as the 'Kvam' properties. In the same year, the 'Kvam' acreage was transferred by Rozan to his nephew, Sanford Rollins, however, it is evident that Rozan retained the actual and beneficial interest thereof. Subsequently, the 'Kvam' properties developed considerable value and much of the controversy in this case centers around this particular property.

Differences arose in the marriage relationship, and plaintiff and Rozan separated in April of 1953, plaintiff instituting an action for divorce in California. Almost immediately following the separation, Rozan, commencing in June, 1953, transferred and conveyed, without plaintiff's knowledge or consent, the North Dakota mineral interests to defendants, Eugene D. Rosen, individually, and as trustee for John Elias Rozan, and to defendant McCormick.

On July 12, 1955, plaintiff was granted an interlocutory decree of divorce in California, and upon appeal such decree was modified and affirmed, the final decree subsequently issuing. The judgment of divorce, among other things, adjudges and determines that the litigants were residents of California for purposes of divorce, and further that all properties accumulated by the parties from and after July, 1948, wherever located, including real property interests in North Dakota, was and is community property of the parties, such interests having been acquired with community property funds and assets. The decree further found that Rozan's transfers and conveyances to defenant Rosen, individually, and as trustee for John Elias Rozan, and to defendant McCormick, were wash transactions upon simulated considerations, being a scheme attempting to defeat plaintiff's marital interest, the California court adjudicating all such transfers and conveyances fraudulent as to plaintiff. The judgment further awarded and decreed to plaintiff a 65% interest, Rozan retaining the remaining 35% interest, of all community property, including therein the real property interests situate in North Dakota, plaintiff further being granted alimony, support money and other incidental relief.

The instant action is brought by plaintiff upon the California divorce decree to recover accrued sums under that judgment; to have this Court decree all North Dakota property acquired by Rozan and plaintiff, as described in the complaint, to be community property of plaintiff and Rozan; to establish title to such community properties in the ratio of 65% to plaintiff and 35% to Rozan, as fixed by the California divorce decree, and that plaintiff's...