Smith's Estate, In re
| Decision Date | 25 April 1968 |
| Docket Number | No. 39211,39211 |
| Citation | 440 P.2d 179,73 Wn.2d 629 |
| Parties | In the Matter of the ESTATE of Dan SMITH, Deceased. Betty ROWE and Jeanie Taylor, Appellants, v. Helena SMITH, Widow of the Deceased, Respondent. |
| Court | Washington Supreme Court |
Jackson, Ulvestad & Goodwin, Thor P. Ulvestad, Seattle, for appellants.
Jerry T. Haggarty, Seattle, for respondent.
The respondent, surviving spouse of Dan Smith, deceased, petitioned the superior court for clarification of two paragraphs of his will, contending that property referred to therein as separate property of the testator was in fact community property. The appellants, daughters of Dan Smith by a prior marriage, to whom he bequeathed 75 percent of his separate property, opposed this contention of the widow.
The trial court found that the earnings of the truck parts business which Smith conducted as a sole proprietorship throughout and before his marriage, were community property, those earnings which were attributable to his skill and labor having been hopelessly commingled with those which were attributable to the inventory which existed at the time of the marriage and which had a probable value of approximately $6,900; 1 that his separate funds and community funds were commingled in his bank accounts, with no attempt to keep them segregated, and that therefore the funds contained in these accounts were community property except to the extent that the evidence showed them to be separate funds.
Having traced the proceeds of the sale of certain property which the deceased owned prior to his marriage, the trial court found that $16,666.67 in one bank account was separate property. The appellants were thus held to be entitled to 75 per cent of this amount plus 25 percent of the remainder of the funds, which was community property.
The appellants challenge the court's findings as to the nature of the property in question. They concede that the deceased did deposit all of his earnings in bank accounts which were not segregated as to community and separate property. They contend, however, that the funds in these accounts were separate property, rather than community property, because the deceased regarded them as such and never 'attributed' them to the community.
The rule is well settled that, where the separate property in question is an unincorporated business with which personal services ostensibly belonging to the community have been combined, all of the income or increase will be considered as community property in the absence of a contemporaneous segregation of the income between the community and the separate estates. Hamlin v. Merlino, 44 Wash.2d 851, 272 P.2d 125 (1954); In re Witte's Estate, 21 Wash.2d 112, 150 P.2d 595 (1944); Salisbury v. Meeker, 152 Wash. 146, 277 P. 376 (1929).
However the testator chose to regard it, therefore, the income from the business after the marriage was community property. It is also the rule that, where money in the bank cannot be segregated as to its sources and its separate and community natures have become so confused that the court cannot apportion them, the presumptions in favor of community property and the favor with which it is regarded require that all of such funds be attributed to the community. Jacobs v. Hoitt, 119 Wash. 283, 205 P. 414 (1922). The trial court correctly held that all of the funds in the bank accounts were community funds except those which could be identified as separate property.
In the case of two lots in Georgetown, a section of Seattle, which were purchased in 1956, prior to the marriage, the court was able to ascertain that the testator had sufficient separate funds at the time of the marriage to complete the payment of the purchase price of these two lots, although they were only partially paid for at that time, and therefore determined that they were separate property. The purchase price of these lots was $7,500. Two adjoining lots were purchased after the marriage for $15,000. There was no showing that separate funds were used in their purchase and the trial court correctly held that these lots were community property. All property acquired by either of the spouses during coverture is presumptively community property, and the burden is upon the party who contends that it is separate property to prove otherwise. Rustad v. Rustad, 61 Wash.2d 176, 377 P.2d 414 (1963). The appellants did not sustain that burden in this case.
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Dean v. Lehman
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...(2) The necessity of proving a contemporaneous segregation of income between the community and separate estate. In re Estate of Smith, 73 Wash.2d 629, 630-31, 440 P.2d 179 (1968). When separate property is combined with community property in the acquisition or production of assets, that seg......
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...is then considered community income, and the balance of his income remains his separate property. As stated in In re Estate of Smith, 73 Wash.2d 629, 440 P.2d 179 (1968): The rule is well settled that, where the separate property in question is an unincorporated business with which personal......
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...King, The Challenge of Apportionment, 37 Wash. L. Rev. 483, 494-96 (1962). The courts reiterated the Hamlin dictum in In re Smiths Estate, 73 Wn.2d 629, 440 P.2d 179 (1968), and Pollock v. Pollock, 7 Wn.App. 394. It should be noted that in both of those cases, there had been no contemporane......