Wachter v. Wachter

• Decision Date: 11 March 1987
• Docket Number: No. 17122,17122
• Citation: Wachter v. Wachter, 357 S.E.2d 38, 178 W.Va. 5 (W. Va. 1987)
• Court: West Virginia Supreme Court
• Parties: Janet B. WACHTER v. Del Frank WACHTER and James F. Wachter.

Page 38

357 S.E.2d 38

178 W.Va. 5

Janet B. WACHTER v. Del Frank WACHTER and James F. Wachter.

No. 17122.

Supreme Court of Appeals of West Virginia.

March 11, 1987.

Rehearing Denied June 3, 1987.

Syllabus by the Court

1. "Before a trial court may properly impress a constructive trust on property titled in the name of one spouse for the benefit of the other, the spouse seeking the trust must by a preponderance of the evidence: (1) overcome the presumption that there was a gift between the parties, and (2) show that he or she is otherwise entitled to the declaration of a constructive trust. Entitlement to a constructive trust requires: (a) a showing that the party transferred to his or her spouse money, property, or services which were actually used to procure property titled in the other spouse's name only; (b) that the transfer was induced by (i) fraud, (ii) duress, (iii) undue influence, (iv) mistake, (v) breach of implicit fiduciary duty, or (vi) that in light of the dissolution of the marriage the other spouse would be unjustly enriched by the transfer." Syl. pt. 4, Patterson v. Patterson, 167 W.Va. 1, 277 S.E.2d 709 (1981).

2. "Where one spouse purchases real or personal property and pays for the same, but takes title in the name of the other spouse, such transaction shall, in the absence of evidence of a contrary intention, be presumed to be a gift by the spouse so purchasing to the spouse in whose name the title is taken...." W.Va.Code § 48-3-10 (1986).

Robert R. Skinner, Charles Smith, Charles Town, for appellant.

Charles F. Printz, Jr., Martinsburg, for appellees.

BROTHERTON, Justice:

Janet B. Wachter appeals from the Circuit Court of Morgan County, claiming that several errors were made in the adjudication of her share of the estate of her husband, the late Herbert D. Wachter. We find no error in the proceedings below, and therefore affirm.

Herbert Wachter, a resident of Morgan County, died testate on October 20, 1984. He was survived by Janet Wachter, his wife of seventeen years, and by two sons by a previous marriage. The sons are the appellees, Del Frank Wachter and James Ford Wachter. The decedent's will left his entire estate to his sons and expressly left nothing to his widow. The widow elected to renounce the will and to take her intestate share pursuant to W.Va.Code § 42-3-1 (1982). THE PROBATE ESTATE CONSISTed primarily of THe wachters' home and the real estate on which it was located. The decedent also had a certificate of deposit in the amount of approximately $111,000, which passed outside his will to his son, James Ford Wachter, by right of survivorship.

The sons instituted a civil action in the Circuit Court of Morgan County, seeking possession of the home and a lump sum award to the widow for her dower interest in the real estate. Mrs. Wachter counterclaimed that she was entitled to a constructive trust in the real estate because she had contributed to the purchase price, improvements, and repair of the home pursuant to an understanding with her husband that she was to have a half interest. Record title was in the husband's name at all times. Mrs. Wachter also asserted that she was entitled to one-third of the $111,000 certificate of deposit, because it was made with fraudulent intent to deprive her of her share of the couple's savings.

In addition, at the trial the sons introduced the original of a written property settlement agreement between Herbert and Janet Wachter, which was signed by the parties and acknowledged by a notary public on November 22, 1982. Herbert Wachter had filed twice for a divorce in the latter years of the couple's marriage, and the agreement cites irreconcilable differences as the reason for determining property rights between the parties. The agreement provided a formula for Herbert Wachter's purchase of his wife's one-half interest in jointly owned real estate, made reference to an equal division of a joint savings account, and provided that Janet Wachter would waive all rights of dower and inheritance against her husband. There was some controversy over whether the subject real estate was the marital home or an unimproved lot adjacent to the home (because only the unimproved lot was jointly owned), and the circuit court found that it was the unimproved lot. Also, there was no joint savings account to be divided. Moreover, the parties did not separate or divorce before Herbert Wachter's death, and the agreement was never performed in any respect.

When the agreement was introduced at trial, Janet Wachter testified that her signature did not look authentic, that she never signed an agreement of that length, and that it looked as if the signature page had been taken off another document and attached to this agreement. The notary testified that he remembered acknowledging both signatures but didn't review the document itself.

The trial court found in favor of the sons on all issues, and awarded Janet Wachter $15,286, representing her dower interest in the real property. She raises three issues on appeal: First, whether she was entitled to a constructive trust in the marital home, which would give her a one-half interest; second, whether Herbert Wachter's creation of a joint certificate of deposit with his son was a fraudulent transfer and therefore void under W.Va.Code § 40-1-1 (1982); and third, whether the property settlement agreement of November, 1982, should be enforced.

I.

Janet Wachter testified that she provided at least half of the $100 used by her husband to purchase a lot from his parents on which their home was built; that she was a joint obligor on notes used to finance the construction of their home; and that she used her own money to repay portions of the home loan, repairs, etc. Other evidence adduced at trial showed that Herbert Wachter made at least $12,000 in payments on the couple's $16,000 mortgage from his separate checking account. ¹ Both husband and wife made regular contributions to the parties' joint checking account. All payments shown to have been made by Janet Wachter were made from the joint account. Janet Wachter worked as a teacher throughout the marriage, and did contribute to the joint checking account, although she testified that she also had a separate checking account.

In syllabus point 4 of Patterson v. Patterson, 167 W.Va. 1, 277 S.E.2d 709 (1981), this Court set out the rules for imposing a constructive trust on property titled in the name of one spouse for the benefit of the other in a divorce case:

Before a trial court may properly impress a constructive trust on property titled in the name of one spouse for the benefit of the other, the spouse seeking the trust must by a preponderance of the evidence: (1) overcome the presumption that there was a gift between the parties, and (2) show that he or she is otherwise entitled to the declaration of a constructive trust. Entitlement to a constructive trust requires: (a) a showing that the party transferred to his or her spouse money, property, or services which were actually used to procure property titled in the other spouse's name only; (b) that the transfer was induced by (i) fraud, (ii) duress, (iii) undue influence, (iv) mistake, (v) breach of implicit fiduciary duty, or (vi) that in light of the dissolution of the marriage the other spouse would be unjustly enriched by the transfer.

These same standards apply in the current situation, with the possible exception of the final criterion regarding unjust enrichment upon dissolution of the marriage. ²

With regard to the presumption of a gift, West Virginia Code § 48-3-10 (1986) provides that where one spouse purchases property and pays for it, but titles it in the other spouse's name, the transfer is presumed to be a gift, absent evidence of a contrary intention. ³ Janet Wachter does not dispute that Herbert Wachter held title to the real estate in issue. She testified that she...