Thomasi v. Koch

• Decision Date: 24 March 1983
• Docket Number: No. 5776,5776
• Citation: 660 P.2d 806
• Parties: Mario THOMASI and Doris Thomasi, Appellants (Defendants), v. Linda KOCH, Administratrix and Personal Representative of Edra Vaughn Bainbrich, Deceased, Appellee (Plaintiff).
• Court: Wyoming Supreme Court

Page 806

660 P.2d 806

Mario THOMASI and Doris Thomasi, Appellants (Defendants), v. Linda KOCH, Administratrix and Personal Representative of Edra Vaughn Bainbrich, Deceased, Appellee (Plaintiff).

No. 5776.

Supreme Court of Wyoming.

March 24, 1983.

Neil J. Short, and Michael J. Krampner, Casper, for appellants.

C.L. Harden, and William W. Harden, Casper, for appellee.

Before ROONEY, C.J., ^* and RAPER, THOMAS, ROSE, ^** and BROWN, JJ.

THOMAS, Justice.

This appeal raises the question of whether a constructive trust in real property can be found to exist under Wyoming law in the absence of adequate proof of a fiduciary relationship or a close family relationship. A secondary issue is raised with respect to the sufficiency of the evidence to satisfy a standard which requires clear and convincing evidence. The district court ruled that a constructive trust had been established, and awarded the property to the appellee. We shall affirm the district court.

The property which is the subject matter of this case consists of a building located on all of one lot and a portion of another lot in the City of Casper in Natrona County, Wyoming. It was purchased by Mrs. Edra Vaughn Bainbrich, the appellee's decedent, in 1948 for an apparent consideration of $6,600. From that time until the death of Mrs. Bainbrich in 1980 the property was used as a dance school, and was known as the Bainbrich School of Dance. During this entire period Mrs. Bainbrich and her husband, Clay Bainbrich, continued to exercise total dominion over the property. The Bainbriches paid all utility bills; they paid all tax notices through 1979; and subsequent to the transfer of the property to the Thomasis they even granted the telephone company an easement across the property. In all respects the Bainbriches treated the property as their own until the death of Mrs. Edra Vaughn Bainbrich.

Sometime prior to the early months of 1968, possibly around Christmastime of 1967, the Bainbriches and a passenger in their automobile were involved in an automobile accident. According to the reports of the case in the Colorado Court of Appeals and the Colorado Supreme Court, the accident involved the automobile, which was driven by Mr. Bainbrich, skidding on the ice and colliding with a guardrail resulting in injuries to the passenger. Bainbrich v. Wells, 28 Colo.App. 432, 476 P.2d 53 (1970), affirmed Wells v. Bainbrich, 176 Colo. 503, 491 P.2d 976 (1971). During the pendency of this action brought by the passenger, Mrs. Bainbrich sought advice of counsel with respect to divesting herself of the title to the property in Casper for the purpose of placing it beyond the reach of creditors. Wyoming counsel testified that the intention of Mrs. Bainbrich and her husband was to transfer the property until the conclusion of the legal action in Colorado, but to arrange to have the property reconveyed to them after the disposition of the Colorado litigation. Their Wyoming attorney refused to prepare the deed which was requested by the Bainbriches for this purpose.

Subsequently, on March 8, 1968, Mrs. Bainbrich executed a warranty deed to Mario Thomasi and Doris Thomasi. The deed was executed in Denver, Colorado. Mr. Bainbrich testified that prior to the execution of this deed he obtained $4,000 in cash from a safety deposit box in Casper, and that he gave this money to Doris Thomasi in Denver, Colorado, on the date of the conveyance. The $4,000 was deposited in the Thomasis' checking account, and a check for that same amount was made to Mrs. Bainbrich as consideration for the warranty deed. The record justifies a conclusion that Mrs. Bainbrich selected the Thomasis to be the grantees of this deed because of a close, warm friendship which she had with Doris Thomasi. Their relationship began in the mid-1950s with their introduction by Mrs. Bainbrich's sister, who then was married to Doris Thomasi's brother. The intimacy of their relationship appears from the testimony of Doris Thomasi describing an earlier automobile accident in which Mrs. Bainbrich was injured and following which she came to the Thomasis' home and was taken care of by Doris Thomasi while she was recuperating from her injuries. The Thomasis concede the existence of a close and warm relationship as friends between Mrs. Bainbrich and Doris Thomasi.

The record discloses that following the transfer of the property in question to the Thomasis the deed was retained by the Bainbriches, and they took it to Casper, Wyoming, where they recorded it in the office of the county clerk. From that time until after Mrs. Bainbrich's death the Thomasis did nothing to exercise any dominion over the Casper property. No mention of that property was made in an extensive property settlement agreement entered into by the Thomasis immediately preceding the dissolution of their marriage in 1974. They did not pay taxes on the property; they did not insure the property; and they even forgot that they had any ownership of the property. They never even had a key. It was only after Mrs. Bainbrich's death that the Thomasis took any action concerning the property. Upon being contacted by the attorney for the estate who requested the return of the property, the Thomasis then began paying taxes on the property, and they listed it for sale at a price of $145,000 with a Casper real estate agency. The explanation offered with respect to the history of the Thomasis in ignoring their interest in the property was that the use of the property during the intervening years by the Bainbriches was permissive.

Following a trial to the court, an opinion letter in favor of the appellee was directed to the parties by the district court. The Judgment of the court which was entered later incorporated the following pertinent findings which were consistent with the opinion letter:

"3. There existed on March 1, 1968, and for sometime prior thereto a relationship of trust and confidence and a pattern of content which bespeaks the intent to create a fiduciary relationship between Plaintiff's decedent and Defendant.

"4. That the consideration recited in the warranty deed of March 1, 1968, from Plaintiff's decedent to Defendants was a sham and in fact there was a total failure of consideration for the transfer of said property to Defendants.

"5. That to permit Defendants to retain Plaintiff's decedent [sic] property would result in unjust enrichment to the Defendants.

"6. That the purpose of the transfer of Plaintiff's decedent [sic] property to the Defendants was to protect Plaintiff's property from creditors and the purpose of such transfer was understood and intended by all.

"7. That Defendant[s] do not now have and have never had any ownership interest in said property and hold bare legal title thereto, in trust for the Plaintiff's decedent."

The court then made its judgment in the following form:

"THEREFORE, IT IS ORDERED, ADJUDGED AND DECREED that Defendants hold the subject property at 460 South Oak Street and more particularly described as follows:

"Lot 12, and the North 35 Feet of the East 95 and 1/2 feet of Lot 11, Block 21, City of Casper, Natrona County, Wyoming

"together with all improvements thereon situate upon a constructive trust for the benefit of Plaintiff.

"IT IS FURTHER ORDERED, that by virtue of imposing a constructive trust upon Defendants and by declaring that Defendants are unjustly enriched and that the consideration cited was a sham and that the deed transferring the property into Defendants['] name is a nullity and is void and of no force and effect and that the title be, and hereby is, quieted and confirmed in the name of Plaintiff's decedent, Edra Vaughn Bainbrich."

It is from this judgment that the Thomasis have taken their appeal in this case.

In presenting their appeal the Thomasis articulate the issues, the resolution of which they argue will result in a favorable decision for them, as follows:

"(1) Can a constructive trust be found to exist in the absence of either a fiduciary relationship or a close familial relationship between transferor and transferee at the time of the transfer or conveyance?

"(2) Is the contested parol evidence adduced by Appellee at trial sufficient to establish clear and convincing proof that a fiduciary relationship existed, and that a constructive trust was established in this case?"

The appellee in her brief asserts a more simplistic single issue, which she states as follows:

"The sole issue before the court is whether or not the trier of facts' findings are clearly erroneous or so totally at odds with the evidence as to be irrational."

We do not find a requirement in the jurisprudence of the State of Wyoming that a constructive trust can only be found if a fiduciary relationship or a close family relationship exists between the transferor and transferee at the time that the property is transferred. We reiterate the close, warm and friendly relationship between Doris Thomasi and Mrs. Bainbrich. It does seem that the question of the type of relationship required to impose a constructive trust is one of first impression with this court. ¹ In prior cases, however, this court has recognized that one of the primary purposes for which a constructive trust will be imposed is that of preventing unjust enrichment. Fuller v. Fuller, Wyo., 606 P.2d 306 (1980); Flohr v. Walker, Wyo., 520 P.2d 833 (1974); and McConnell v. Dixon, 68 Wyo. 301, 233 P.2d 877 (1951). The facts of this case, as found by the district court, lead ineluctably to the view that unjust enrichment would result should a constructive trust not be imposed by the law.

While serving on the bench of the State of New York, Justice Cardozo tellingly stated the inherent qualities of a constructive trust as a remedial and flexible device:

" * * * A constructive trust is the formula through which the conscience of equity finds expression. When property has been acquired in such circumstances that the holder of legal title may not in good...