Stewart v. Todd

• Decision Date: 10 July 1919
• Docket Number: 30894
• Citation: 173 N.W. 619,190 Iowa 283
• Parties: SAMUEL M. STEWART, Appellee, v. SAMUEL W. TODD et al., Appellants
• Court: Iowa Supreme Court

173 N.W. 619

190 Iowa 283

SAMUEL M. STEWART, Appellee, v. SAMUEL W. TODD et al., Appellants

No. 30894

Supreme Court of Iowa, Des Moines

July 10, 1919

SUPPLEMENTAL OPINION DECEMBER 16, 1920.

Appeal from Van Buren District Court.--FRANCIS M. HUNTER, Judge.

ACTION in equity for the specific performance of an alleged contract. The opinion states the facts.--Modified and affirmed.

Affirmed.

W. D McCormick, Sloan & Sloan, J. C. Calhoun, and W. L Birkheimer, for appellants.

J. C Mitchell and Robert R. McBeth, for appellee.

GAYNOR, J. LADD, C. J., WEAVER, PRESTON, and STEVENS, JJ., concur. EVANS, J. (dissenting in part), SALINGER, J. (dissenting).

OPINION

GAYNOR, J.

Samuel M. Stewart and one Emma A. Stewart were husband and wife. On or about February, 1881, they entered into a contract in writing. The original of this contract was not produced on the trial. Its absence was accounted for, and secondary evidence of its contents rightly permitted. From this evidence it appears that the contract so entered into was substantially as follows:

"Contract entered into this day of February, 1881, by and between Emma A. Stewart and S. M. Stewart, both of Van Buren County, Iowa, witnesseth:

"That said parties have agreed to start a general store under the firm name of E. A. Stewart, in which each party is to be an equal partner. S. M. Stewart is to transact and do all the business, sign the firm name of E. A. Stewart to any and all papers necessary; and all the property accumulated, purchased and owned by either party to be in the firm name of E. A. Stewart. Both parties to use any money they need, and at the death of either party the one living shall fulfill all contracts, pay all debts, and have all property left or owned by either party, or in the firm name."

Upon the execution of this contract, the parties thereto opened a general store at Mt. Sterling, Iowa, in the name of E. A. Stewart. The capital used in this enterprise was very small, but the larger portion of it was undoubtedly furnished by Samuel M. Stewart. From that time until 1894, the store was run in the name of E. A. Stewart, managed and controlled, so far as this record shows, by Samuel M. Stewart, Mr. and Mrs. Stewart both assisting in the purchase and sale of goods and in the conduct of the business generally. This proved a successful venture, and the close of each year found a large profit to the credit of the firm.

On the 25th day of September, 1894, the stock of merchandise and fixtures in this store were sold to Madden & DeHunt, the contract reciting "that E. A. and S. M. Stewart have this day sold to Madden & DeHunt their stock of merchandise and fixtures, situated," etc., describing the location. The consideration paid was $ 3,000. The exact amount is not clearly ascertainable from this record.

On February 28, 1894, before the sale of this stock and while the store was being operated under the contract aforesaid, Emma A. Stewart and S. M. Stewart entered into a written contract with one John Gwinup for the purchase of 196 acres of land for $ 6,550. This contract was signed by Emma A. Stewart and S. M. Stewart. In the consummation of the contract, the deed was made on June 2, 1894, to Emma A. Stewart. The original deal was made by S. M. Stewart, and the preliminary contract signed by both. The purchase price was paid with partnership money, the proceeds of accumulated profits during the continuance of the business. The record affirmatively shows that, up to this time, neither party had any source of revenue except that which came from this partnership venture. There is some suggestion that Mrs. Stewart may have received money from her father, but there is no substantive evidence of this fact, and therefore we say that the record discloses that this land was purchased and paid for out of partnership funds.

Soon after the purchase of this land, Samuel M. Stewart and his wife took possession, and thereafter continued to occupy it as their home farm until the death of Mrs. Stewart. The land is referred to in the record as the home farm.

After the purchase of this farm, it was managed and controlled by Samuel M. Stewart. Stock was purchased by him and placed on the farm. In fact, he had the full management and control of it. The farm also proved profitable, and, in the course of time, other lands were purchased, and title taken in the names of E. A. Stewart and Emma A. Stewart, a detailed description of which is not necessary to the determination of the matters involved in this suit. But the record discloses that, after the sale of the store, there was no source of revenue to these parties except that which came as profits from this farm venture. In fact, all property the legal title to which stood in the name of Emma A. Stewart or E. A. Stewart, at the time of the death of Mrs. Stewart, on September 9, 1913, was purchased from accumulated profits arising from the original enterprise started by these parties under the contract of partnership made in 1881, and is traceable to that enterprise, except the lands conveyed to Emma A. Stewart in 1896 by her father and mother. The record of these conveyances is found in Book 59, pages 108 and 109 of the Clark County records of the state of Missouri, and in Book 36, page 66, of the Van Buren County records of this state. There seems to have been no consideration paid for either of these pieces of land, either by Mr. or Mrs. Stewart.

The plaintiff, however, does not rely upon a claim of partnership as a basis for the relief sought in this case. He bases his claim of right to all the property, whether in the name of E. A. or Emma A. Stewart, on the claimed binding force of the original contract, entered into in 1881, providing "that, at the death of either party, the one living shall fulfill all contracts, pay all debts, and have all property left or owned by either party, or in the firm name," supplemented by two reciprocal wills, executed on the 1st day of May, 1896.

The existence of the partnership is only an incident, and not the basis on which plaintiff rests his right to relief in this case. The rights he seeks to enforce are based upon the original, written contract of partnership, entered into in 1881, supplemented by the two reciprocal wills executed on the 1st day of May, 1896. It is claimed that the formation of the partnership, the investment of money in the partnership, and the subsequent investment of the earnings of the partnership in land, in the name of one of the parties, show a consideration for a performance of and such reliance on that contract that its binding force and legal efficacy, supplemented by the wills aforesaid, cannot be avoided by the acts of one of the parties to it, without the consent of the other.

In May, 1896, Mr. and Mrs. Stewart went to the office of William M. Walker, a practicing attorney in Van Buren County. They had with them at that time the original contract of partnership, hereinbefore set out. It was submitted to Mr. Walker for examination. He read it. He said:

"The contract was handed to me, and I was asked to read it and give my opinion as to whether or not it was a valid and binding contract. After an examination, I said to them that, in my judgment, it was a valid and binding contract, and that I would advise that she and her husband each make a will in favor of the other, and then, in my judgment, the contract and the wills would be binding and valid. At that time, Mrs. Stewart's father and mother and husband were all present. Mrs. Stewart said, at that time, that it was her thought and her husband's that she would, in all probability, outlive him, and they wanted to know whether the contract would have the effect of giving to her, in case of his death, all their property; and wanted to know, in case of her death, would it have the same effect as to him. They expressed the desire that, in case of death of either of them, the other should have all the property which they owned at the time. Thereupon, I prepared two wills, one for each. They were exactly alike, except that Mrs. Stewart made a special bequest of her watch to one of her nieces."

After the wills were executed, they discussed between themselves a place of deposit. They concluded, however, to deposit them with the clerk of the district court, on Mr. Walker's suggestion. The will executed by Samuel M. is substantially as follows:

"I will and bequeath that all my just debts and funeral expenses be paid.

"2d. After the payment of my debts and expenses, I will, devise and bequeath all my property, both real and personal, of whatever kind and wherever situated, of which I may die possessed, to my beloved wife, Emma A. Stewart."

Mrs. Stewart's will was the same, except as to the devise of her watch to her niece, and devised all the property of which she died seized to Samuel M. Stewart. These reciprocal wills were deposited with the clerk of the court, but were subsequently taken from his custody and placed in a receptacle, to which both parties had access, in the home of Mr. and Mrs. Stewart. So far as Samuel M. Stewart knew, or had reason to know, they remained there and were there at the time of the death of Mrs. Stewart. Upon the death of Mrs. Stewart, however, it developed that, on the 17th day of August, 1907, Mrs. Stewart executed another will, in which she revoked and canceled any and all former wills made by her, and undertook to and did make a disposition of her property inconsistent with the provisions of the reciprocal will heretofore referred to. It is this will that provokes the controversy. This will was produced and duly probated, and under this will claims are being urged, antagonistic to the claims of plaintiff in this suit.

This is the record on which the rights...