Shong v. Farmers' & Merchants' State Bank, Hutchinson, Minn., 7494
| Decision Date | 07 June 1955 |
| Docket Number | No. 7494,7494 |
| Citation | 70 N.W.2d 907 |
| Court | North Dakota Supreme Court |
| Parties | Peter M. SHONG, Plaintiff and Appellant, v. FARMERS' & MERCHANTS' STATE BANK, Inc., HUTCHINSON, MINNESOTA, a corporation; John A. Humbird, trustee; Hutchinson State Bank; R. L. Mackedanz; Ida Mackedanz; Mohall State Bank, a defunct banking corporation; Charles H. Pettis, also known as C. H. Pettis; Bertha Pettis; Ray Shong; Hans S. Rapp, administrator of the Estate of Alfreda Shong, deceased; the heirs of Alfreda Shong, deceased, namely, Grace Conway, Gladys Schmidt, also known as Mrs. Gordon Schmidt, Frances Shong, Franklin R. Shong, Hazel R. Shong, Alice B. Sulster, and Barton J. Westergren; and the County of Renville, North Dakota, a municipal corporation and a political subdivision of the State of North Dakota; and all other persons unknown claiming any estate or interest in or lien or encumbrance upon the property described in the Complaint, Defendants and Respondents. |
Syllabus by the Court.
1. When a transfer of real property is made to one person and the consideration therefor is paid by or for another, a trust is presumed to result in favor of the person by or for whom such payment is made. Subsection 4 of Section 59-0106, NDRC 1943.
2. Parol evidence is admissible to prove an implied or resulting trust from payment of the purchase money for the conveyance to another and to show that the consideration belonged to the person claiming the trust or was paid for another. Such trust does not depend upon contract. It arises by operation of law and is not affected by the statute of frauds.
3. Whether a trust is created is primarily a question of intention.
4. Where a parent pays the consideration for real property and has a conveyance run to a child, there is a rebuttable presumption of a gift.
5. Section 31-0103, NDRC 1943 may not be extended by interpretation or by judicial construction beyond its plain application and is to be confined to the letter thereof.
6. In an action to quiet title by a son of a deceased, who claims real property under an absolute conveyance, and his brother and sisters claim that he holds the title as a trustee, and in which action the administrator of the deceased is named as a party defendant but did not otherwise appear therein, and the brother and sisters are designated as heirs, but do not claim any interest in the property as heirs of the deceased, the actual facts involved and not the title to the action determine whether the parties appear in the action in the capacity of executor, administrator, personal representative or heirs and where the facts show that they do not so appear, the parties to the action are not prohibited by Section 31-0103 of the NDRC 1943 from testifying to transactions between themselves and the deceased.
7. The evidence in this action is examined and it is held for reasons set forth in the opinion that a resulting trust has been established by that weight of evidence which the law requires and that the proof thereof is clear, specific and satisfactory and that the plaintiff and his brother, Franklin Shong, and his sisters, Gladys Schmidt, also known as Mrs. Gordon Schmidt, Frances Shong and Hazel Shong, have a beneficial interest in the real property and hold title thereto as tenants in common subject to a lien in favor of the plaintiff as determined by the trial court.
8. That where an attorney and client relationship exists, an attorney without the consent of the client, cannot be examined as to any communication made by the client to him nor as to his advice thereon in the course of professional employment. Section 31-0106, subsection 1, NDRC 1943.
9. Where an attorney is consulted and acts professionally, it is not necessary, in order to render communications to him privileged, that he should require or be paid a regular retainer or should charge or receive any fee for his service or services.
10. Where the relationship of attorney and client exists, the attorney may not testify in an action unless the privilege has been waived. The evidence of the attorney properly objected to under the statute is inadmissible where no waiver of the privilege exists.
Duane R. Nedrud, Minot, for plaintiff and appellant.
McGee & Van Sickle, Minot, for defendants and respondents.
This action comes to us for a trial de novo upon an appeal from a judgment of the district court of Renville County, North Dakota, decreeing that the plaintiff, Peter M. Shong, and the defendants, Gladys Schmidt, Grace Conway, Frances Shong, Franklin Shong, Hazel Shong, Barton J. Westergren, and Alice B. Sulster, the children of Alfreda Shong, deceased, are the owners as tenants in common of the South Half (S 1/2) of Section 23, Township 163, Range 84, Renville County, North Dakota. This real property was purchased from Renville County under a contract for deed in the name of Peter Shong on the 15th day of January, 1942, and a county deed was issued to him on the 26th day of January, 1945. He brought an action to quiet title to the premises on the 21st day of March, 1952, claiming to be the absolute owner thereof. The answering defendant, Gladys Schmidt, claims that he holds the title in trust.
If the facts in this action warrant the determination that the plaintiff holds title to the premises for himself and his brothers and sisters, the trust arises by implication and would be in the nature of a resulting trust.
The trial court decided the issues between the parties apparently on the theory of an implied trust. An implied trust is one which is created by operation of law. Section 59-0105, NDRC 1943.
A trust in land created by operation of law may be established by parol evidence. Fox v. Fox, 56 N.D. 899, 219 N.W. 784. Parol evidence is admissible to prove an implied trust resulting from payment or ownership of the purchase money for the conveyance to another and to show that the consideration paid belonged to the person claiming the trust. 65 C.J. 385 et seq.; 89 C.J.S., Trusts, Sec. 116; Sheffield Milling Co. v. Heitzman, 192 Iowa 1288, 184 N.W. 631. Such trust does not depend upon contract, but arises by operation of law and is not affected by the statute of frauds. Redman v. Biewer, 78 N.D. 120, 48 N.W.2d 372.
The record in this case reveals that Alfreda Shong was married twice. Her first husband was Michael H. Conway. Peter M. Shong and Grace Conway, Alice B. Sulster and Barton J. Westergren are children of the first marriage of Alfreda Shong. One son of the first marriage of Alfreda Shong was killed in the war. The testimony is silent as to what war, but it must have been World War II. None of the children of the first marriage ever lived on the premises involved in this action except Peter M. Shong, the plaintiff. Sometime in the 1920's, Alfreda Conway married Ray Shong. On March 6, 1931, under a land sale contract, Ray Shong and Alfreda Shong, his wife, purchased the premises involved in this action from the Farmers' and Merchants' State Bank of Hutchinson, Minnesota, for the sum of $5,000.
It appears that four children were born of the marriage of Ray Shong and Alfreda Shong, to wit: Gladys Schmidt, also known as Mrs. Gordon Schmidt; Frances Shong, Hazel Shong and Franklin Shong. About 1936, Ray Shong abandoned and deserted his family. The address of Ray Shong is unknown. The evidence does not show whether he is dead or alive. The taxes on the premises were not paid and Renville County acquired title thereto for nonpayment of taxes on the 10th day of April, 1940. At that time Peter M. Shong, the plaintiff, a child of the first marriage of Alfreda Shong, was about twenty years of age and the other children were between twelve and seventeen years old.
The dispute in the evidence in this action centers around a disagreement as to whether the plaintiff paid for the premises or whether the $2,000 paid therefor was made to Renville County by the combined efforts of Alfreda Shong, now deceased, and Peter M. Shong. It also involves the question of whether the premises were purchased by Alfreda Shong, not only for Peter M. Shong, but for his half brother and sisters, already mentioned, or whether they were purchased by Alfreda Shong for all of her children, both of the first and the second marriage.
Peter M. Shong testified that he had two full sisters and two full brothers, one of whom was killed in the war. The record does not disclose the whereabouts of Grace Conway. The address of Alice B. Sulster, as shown by the record, is Solvang, California. But the record does show that except for Peter M. Shong, the children of the first marriage of Alfreda Shong did not live on the premises which are the subject of this action at any time after the purchase thereof in the name of Peter M. Shong from Renville County, North Dakota, nor did they in any way contribute to the common effort of Peter M. Shong and his half brother and sisters, and Alfreda Shong in maintaining the family and keeping it together on this farm.
There are two types of implied trusts, constructive and resulting. Section 59-0106, NDRC 1943. If a trust is involved here, it is a resulting trust.
The existence of a resulting trust depends upon the acts or expressions of the parties indicating an intent that a trust relation result from their transaction. For a discussion of resulting trusts see Volume 29, North Dakota Law Review, pages 75-80.
The courts are reluctant to ingraft a trust by parol on the legal title to real estate, and there is perhaps no better established doctrine than the one which requires a high degree of proof in order...
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