Scheid v. Scheid

• Decision Date: 12 March 1976
• Docket Number: No. 9179,9179
• Citation: 239 N.W.2d 833
• Parties: Rose Mary SCHEID, Plaintiff-Appellee, v. Roland A. SCHEID, and all other persons unknown claiming any Estate or interest in or lien or encumbrance upon the property described in the complaint, Defendants-Appellants. Civ.
• Court: North Dakota Supreme Court

Page 833

239 N.W.2d 833

Rose Mary SCHEID, Plaintiff-Appellee,

v.

Roland A. SCHEID, and all other persons unknown claiming any

Estate or interest in or lien or encumbrance upon

the property described in the complaint,

Defendants-Appellants.

Civ. No. 9179.

Supreme Court of North Dakota.

March 12, 1976.

Rehearing Denied April 5, 1976.

Syllabus by the Court

1. An implied trust is one which is created by operation of law. § 59--01--05, N.D.C.C. Such a trust may be either a resulting trust based on the implied intention of the parties or a constructive trust imposed by a court of equity to prevent unjust enrichment.

2. An implied trust arises under § 59--01--06(2), N.D.C.C., where one gains a thing by fraud, accident, mistake, undue influence, the violation of a trust, or other wrongful act.

3. The evidence required to establish an implied trust must be clear and convincing.

4. Evidence of a mistake as to the legal effect of a joint tenancy deed, absolute on its face, introduced by the party seeking to have a constructive trust imposed by the court is reviewed and it is held that plaintiff failed to sustain her burden of proving, by clear and convincing evidence, a mistake which would invoke the provisions of § 59--01--06(2), N.D.C.C.

5. Findings that a particular division of property between the parties to a divorce action is equitable are appropriately dealt with on appeal as findings of fact. Findings of fact by the trial court will not be set aside unless they are clearly erroneous.

6. A finding of fact is clearly erroneous only when, although there is some evidence to support it, the reviewing court on the entire evidence if left with a definite and firm conviction that a mistake has been made.

7. The district court's award of North Dakota real property to the wife after a marriage dissolution by Arizona court was not clearly erroneous where the land was a gift to wife from her father; parties had generally treated the land as wife's separate property during the course of the marriage; district court had before it the property settlement agreement incorporated into the Arizona decree, which specifically excepted the North Dakota real property; and where district court had also received evidence detailing, among other relevant factors, the education of both parties, their respective occupations, the source and extent of property acquired during the course of their marriage, and evidence that the couple's only child was an emancipated minor.

Wheeler, Wolf, Wefald & Durick, Bismarck, for defendants and appellants; argued by B. Timothy Durick, Bismarck.

Richardson & Blaisdell, Hazen, for plaintiff and appellee; argued by M. C. Blaisdell, Hazen.

PAULSON, Judge.

This is an appeal by the defendant, Roland A. Scheid (hereinafter Roland), from a judgment of the Mercer County District Court quieting title in the plaintiff, Rose Mary Scheid (hereinafter Rose Mary), to certain real property located in Mercer County, North Dakota.

The parties to this action were married on December 26, 1956. About six months after their marriage, they moved to Phoenix, Arizona, where both parties still reside. The marriage was dissolved by a decree of dissolution of the Superior Court, Maricopa County, State of Arizona, on July 17, 1974.

The land involved in the instant case is pasture land located about three and one-half miles southwest of Mazen, in Mercer County, and is described as:

The Southwest Quarter (SW 1/4) of Section Fifteen (15), Township One Hundred Forty-four (144), Range Eighty-seven (87), situated in Mercer County, North Dakota.

The land was owned by Rose Mary's father, William Christmann, who executed a quit claim deed to Rose Mary on October, 27, 1953, which was about two months before Rose Mary's marriage to Roland, but which deed was not delivered to Rose Mary until 1956. The deed was recorded in the office of the Register of Deeds of the County of Mercer, State of North Dakota, on February 2, 1956.

On December 22, 1966, Rose Mary executed a quit claim deed to such property, transferring ownership to Roland and herself 'as joint tenants with right of survivorship'. Such deed was executed in Maricopa County, Arizona, and was recorded in the office of the Mercer County Register of Deeds on January 16, 1967. The deed recited that such transfer was being made 'For the consideration of Ten Dollars, and other valuable considerations'.

After the dissolution of the marriage between Rose Mary and Roland in July of 1974, Rose Mary commenced this action on August 19, 1974, in Mercer County District Court, seeking, in her original complaint, an order from the court declaring that any interest held by Roland in the property was held in trust for the benefit of Rose Mary.

Personal service of the summons and complaint in this action was thereafter effected on Roland in Arizona. Such service of process is equivalent to personal service within North Dakota. See Rules 4(b)(2)(E) and 4(d)(3), N.D.R.Civ.P.; Grenz v. O'Rourke, 235 N.W.2d 881, 884 (N.D.1975).

Roland, on September 17, 1974, answered Rose Mary's complaint, denying that her transfer of the property in 1966 was intended to be a trust, and also interposed a counterclaim, claiming for himself a joint tenancy interest in the property. Roland further asserted that his interest in such property was established by a judgment and decree entered in a quiet title action in the Mercer County District Court on April 2, 1970.

Rose Mery amended her original complaint, after securing the district court's order permitting her to do so, because the decree of dissolution entered by the Arizona court specifically excluded any disposition of such property. ¹ By such amended complaint, dated January 13, 1975, Rose Mary set forth an additional cause of action and requested that the Mercer County District Court award the property to her as a just and equitable division of the parties' North Dakota property.

Roland interposed an amended answer, denying Rose Mary's claim to the property under either cause of action set forth in her amended complaint, and reasserted his counterclaim. Rose Mary, in her reply to such counterclaim, denied Roland's allegations and the suit was thereafter tried to the court.

The only witnesses called by Rose Mary at trial were her brother, Albert Christmann; Albert's wife, Mardella Christmann; and herself. Roland called no witnesses, relying solely upon his cross-examination of Rose Mary and her witnesses to substantiate his defense and counterclaim. After trial, the trial court held that the land in question was the sole and separate property of Rose Mary. The trial court based such a holding on its conclusion that, at the time of the 1966 transfer of the property into joint tenancy ownership with Roland, Rose Mary was under a mistaken belief as to the legal effect of the joint tenancy deed, which therefore led the court to impose an implied trust for her benefit. Furthermore, the trial court also concluded that Rose Mary was entitled to the property as a result of the marriage dissolution because the property had originally been a gift to her from her father and had been so treated during the course of her marriage to Roland. Roland appeals from the trial court's judgment awarding the land to Rose Mary.

We are presented with two issues in this appeal:

1. Did the trial court err in imposing an implied trust for the benefit of Rose Mary on Roland's claimed interest in the property?

2. Did the trial court err in awarding the property to Rose Mary as a just and equitable distribution of the parties' North Dakota property after their marriage had been dissolved by a court of competent jurisdiction in the State of Arizona?

Roland's first contention in this appeal is that the trial court erred in imposing an implied trust by operation of law on any interest in the property Roland may have acquired by virtue of the 1966 joint tenancy deed executed by Rose Mary. Roland urges that even if the trial court was correct in concluding that Rose Mary was mistaken as to the legal effect of the joint tenancy deed, such mistake is not the type of mistake which comes within the purview of § 59--01--06, N.D.C.C.

The applicable statutes provide, in pertinent part:

59--01--05, N.D.C.C. 'Implied trust--Definition.--An implied trust is one which is created by operation of law.'

59--01--06, N.D.C.C. 'Implied trust--How created.--An implied trust arises in the following cases:

'2. One who gains a thing by fraud, accident, Mistake, undue influence, the violation of a trust, or other wrongful act, is, unless he has some other and better right thereto, an implied trustee of the thing gained for the benefit of the person who would otherwise have had it;' (Emphasis added.)

In the instant case, Rose Mary alleged in her complaint that Roland had acquired an interest in the land in question by procuring the 1966 quit claim deed from Rose Mary by accident, mistake, undue influence, or fraud. After trial, the district court, however, apparently found that Rose Mary had substantiated only her claim of mistake, because the court stated in its Finding of Fact No. 9:

'9.

'That plaintiff and defendant were both mistaken as to the legal effect of the Quit Claim Deed.'

There was no finding by the trial court that Rose Mary had established any claim of accident, undue influence, or fraud on the part of Roland involving the 1966 quit claim deed executed by Rose Mary.

Based upon its findings of fact, the district court, in Conclusion of Law No. 1, held:

'1.

'That defendant took no interest in the property by the Quit Claim Deed nor the action to quiet title, and that an implied trust results by virtue of Section 59--01--06 of the North Dakota Century Code, any interest in the property having been gained by defendant by mistake.'

Implied trusts are created by operation of law and consist of two types: resulting and constructive. Shong v. Farmers' & Merchants' State Bank,70 N.W.2d...