Stewart v. Damron

• Citation: 160 P.2d 321,63 Ariz. 158
• Decision Date: 02 July 1945
• Docket Number: Civil 4665
• Parties: D. J. STEWART, as Administrator of the Estate of William W. Damron, Deceased, Appellant, v. ELIZABETH DAMRON, a Widow, Appellee
• Court: Arizona Supreme Court

160 P.2d 321

63 Ariz. 158

D. J. STEWART, as Administrator of the Estate of William W. Damron, Deceased, Appellant, v. ELIZABETH DAMRON, a Widow, Appellee

Civil No. 4665

Supreme Court of Arizona

July 2, 1945

APPEAL from a judgment of the Superior Court of the County of Maricopa. Dudley W. Windes, Judge.

Judgment affirmed.

Mr. W J. Van Spanckeren, for Appellant.

Messrs Snell, Strouss & Wilmer, and Mr. Richard G. Johnson, for Appellee.

Morgan J. Stanford, C. J., and LaPrade, J., concur.

OPINION

Morgan, J.

Plaintiff brought this action to establish her title in and require Wallace A. Macdonald, administrator of the estate of the deceased, to convey to her a lot, with improvements, situate in the city of Mesa. The grounds of the complaint were that deceased, pursuant to an oral gift agreement, held the property during his lifetime as a trustee for plaintiff. The claim was contested by the administrator. Upon the trial, with the advisory verdict of the jury on interrogatories submitted, all issues were found in favor of plaintiff and judgment entered in her behalf. Various motions by the defendant, including motion and supplemental motion for new trial on the ground of newly discovered evidence, were denied by the court. From the judgment and denial of motions, defendant appealed. During the pendency of the appeal, the present administrator was substituted in lieu of the original defendant-administrator.

The facts proven and as found by the trial court and jury may be summarized as follows: Plaintiff was the mother of the deceased, who was generally known as Bill Damron. She was an elderly woman of modest means, living at Mesa. There existed a very strong bond of affection and relationship of trust and confidence between the mother and son; he was a man of considerable wealth and had taken her on numerous trips; she generally spent several months each summer with him at his home in Kentucky. In 1930 plaintiff had married Wallace A. Macdonald, the original administrator mentioned above. They did not get along and were for the most part not living together in 1937. At that time plaintiff was being supported from the proceeds of property which she had previously sold, rentals from a house and roomers, income from a trust fund established by her son Bill, and money gifts which he sent her from time to time. Bill disliked his mother's husband and appears to have had no confidence in him.

In 1937 Bill Damron came to Mesa and visited his mother. Another son, Roy, who resided in Los Angeles, came to Mesa at about the same time. The mother desired to build some rental houses. The two brothers talked over the matter with their mother and an understanding was reached whereby Bill agreed to assist his mother with funds in the purchase of a lot and for the construction of apartments. Roy was to make the plans, work on and supervise the construction. Legal title was to be taken in Bill's name and held by him for the plaintiff until her marital difficulties could be settled or terminated. Pursuant to this agreement, the lot was purchased and the apartments constructed. One-ninth ($ 50) of the actual purchase price was paid by the plaintiff; she also expended $ 400 in the making of the improvements, the total expenditures being about $ 6,000. The balance of the funds used represented remittances sent to her by her son Bill, or directly to Roy, or through a brother-in-law. The jury found that these remittances were outright gifts and were not ear-marked for construction purposes. Roy worked for seven months without compensation. The building program was carried on in his mother's name. She issued checks and paid all accounts. No account was made by her to her son. When the structures were completed, she took possession and received all income. On many occasions Bill spoke of the houses as his mother's stating that they were hers and that he was holding the title for her. The plaintiff divorced Macdonald in 1939. Following that, Bill told his mother that he would deed her the property when he came to Arizona in about two months. He did not return to Arizona, and was killed in an accident on August 1, 1941, before executing the conveyance.

The assignments of error raise questions as to the sufficiency of the evidence to justify the answers of the jury and the judgment entered. Assignment is also made that the court abused its discretion in failing to grant motion for new trial based on newly discovered evidence.

The questions raised by defendant on this appeal may be stated as follows: (1) The transaction did not constitute a valid gift; (2) the evidence is insufficient to support an estoppel against the deceased, or to bring the case within the exception of the statute of frauds, or to create a trust upon the property involved; (3) the court abused its discretion in failing to grant a new trial, in that it appeared on the hearing of the motion that a letter, containing evidence not cumulative in character and which it is reasonably probable influenced the jury, was admitted on false testimony, the falsity of which could not have been discovered by the exercise of reasonable diligence at the time of the trial.

In support of his first proposition, defendant takes the position that where there is an attempt to establish a gift of real estate inter vivos, or an attempt made to make an imperfect gift valid, under the equitable doctrine of estoppel the plaintiff has the burden to establish the case beyond the ordinary burden assumed in a civil action. Various cases are cited to the effect that the evidence must be certain, clear, complete, direct, positive, express and satisfactory. The gift is required to be established by clear, definite and certain proof. Kelley v. Crawford, 112 Wis. 368, 88 N.W. 296; Caldwell v. Caldwell, 24 Pa.Super. 230; Flanigan v. Waters, 57 Kan. 18, 45 P. 56; Lobdell v. Lobdell, 36 N.Y. 327. Attention is called to Costello v. Cunningham, 16 Ariz. 447, 147 P. 701, 710, where in a case to establish a trust against the record title holder, this court held: "The burden was upon the plaintiffs to establish, by clear and convincing evidence, ownership" of the property claimed. The intent of the donor is a controlling factor in questions concerning gifts. Where the donor has died, his statements are scrutinized with particular care. Owens v. McNally, 113 Cal. 444, 45 P. 710, 33 A. L. R. 369. To constitute a completed or valid gift, the donor must intend to relinquish the right of dominion over the property and create it in the donee, and his intention must be to make a present gift. A mere intention to give in the future will not be sufficient. 24 Am. Jur. 738-740, § 21, Gifts.

The legal principles invoked by defendant are undoubtedly correct. There can be no question that the testimony must be clear and convincing in cases of this character. We so announced the rule in the late case of Stewart v. Schnepf, 62 Ariz. 440, 158 P.2d 529. An examination of the testimony indicates that it meets the requirements of the rule as announced and applied by this court in both the Costello and Stewart cases, supra.

Strictly speaking, this is not an action to attempt to create a trust, but to enforce a trust already created. The evidence, we think, clearly showed that the deceased took and held the title to the property involved as trustee for the plaintiff. She took possession and made valuable and lasting improvements. In these respects the trust was completed. Nothing remained to be done except to transfer the legal title to the plaintiff upon the contingency of divorce from her husband. This is all that is being sought in this action. The proof adduced, disclosing the intent of the deceased to take and hold the property as trustee for his mother, indicates not only the present intent but when the title was so taken, and possession and improvements made, the completion of the gift. The evidence does not disclose an intent to give in the future. Therefore, the authorities cited by defendant concerning an incompleted gift or an uncreated trust do not apply to the situation here. Indeed, the decisions which we have mentioned above, Kelley v. Crawford; Caldwell v. Caldwell; Flanigan v. Waters; and Lobdell v. Lobdell, cited by the defendant, fully support the statement which we have just made. In each of these cases specific performance was allowed to the plaintiff on facts somewhat similar to those in the case at bar.

A parol gift of land may be said to be upon the same footing as a parol sale of land. The rule as to this is succinctly stated in 24 Am. Jur. 764, § 68, Gifts:

". . . It has been said that a parol gift of land is on the same footing as a parol sale of land, and that in order to take a parol gift of land out of the statute of frauds possession must be taken in pursuance of the gift, and as a further condition to the consummation of the equitable right and title, the donee must have made improvements of a valuable and permanent character, induced thereto by the promise to give the land. When these conditions and considerations have followed, the performance of the promise, although by parol, can be enforced in equity, and the donee becomes entitled to specific performance. . . ."

What we have just said and quoted applies more particularly to defendant's second proposition. However, both propositions may best be considered as once since they are inextricable. The same rules of law apply, at least partially, to both.

Our statute of frauds does not contain any direct provision pertaining to the creation of trusts. The seventh section of the English statute, providing that a trust must be manifested by writing, was not adopted by our Legislature. Under the common law an express parol trust in land is valid and...