Wilson v. Wilson

• Court: California Court of Appeals
• Writing for the Court: DORAN; WHITE, P. J., and FOURT
• Citation: Wilson v. Wilson, 299 P.2d 318, 143 Cal.App.2d 53 (Cal. App. 1956)
• Decision Date: 11 July 1956
• Parties: Doris WILSON, Plaintiff and Respondent, v. James Gordon WILSON et al., Defendants and Appellants. Civ. 21519.

Page 318

299 P.2d 318

143 Cal.App.2d 53

Doris WILSON, Plaintiff and Respondent, v. James Gordon WILSON et al., Defendants and Appellants.

Civ. 21519.

District Court of Appeal, Second District, Division 1, California.

July 11, 1956.

Smith, Van Dyke & Hildreth, Jack E. Hildreth, Los Angeles, for appellants.

Belcher, Kearney & Fargo, George M. Henzie, Los Angeles, for respondent.

DORAN, Justice.

The action herein is one for divorce and the appeal is from that portion of a judgment which decreed that a certain limited partnership known as Tri-Color Laboratories was 'fictitious, invalid, void and non-existent and of no force and effect', and that appellant Anna E. Wilson, the husband's mother and nominally a limited partner therein, 'does not have, own or hold any right, title or interest in or to any of the community property' of the husband and wife, including said partnership.

The appeal by the husband and the husband's mother is, according to appellants' brief, 'predicated on the basis that there was no evidence to substantiate the findings of fact * * *, that these findings do not substantiate the conclusions of law, and that there is no evidence to substantiate that portion of the judgment heretofore mentioned'.

The record discloses evidence to the effect that Doris and James Gordon Wilson were married December 31, 1933, at which time Mr. Wilson was president of Harmonzing Cartoon Studios, and Doris Wilson was employed by RKO Theatre Corporation which latter employment continued for about a year after the marriage. During 1937 Mr. Wilson's mother, the appellant Anna E. Wilson, and James A. Wilson, James Gordon Wilson's father, came from New Mexico for a visit, and continued to live with the junior Wilson for some years; the senior Wilson remaining for eleven years until death, and Anna E. Wilson remaining for four years, thereafter living with a daughter, the defendant Doris Seligman. During this period the senior Wilson was only employed for short intermittent periods, and Anna E. Wilson was not gainfully employed during the four year residence with the junior Wilsons. According to plaintiff's testimony, the elder Wilsons 'never had any money. They have never been able to even take care of themselves except for intermittent periods when Pop (Wilson, Sr.) worked, which was a very short period out of his life when I knew him'.

In January, 1940, appellant James Gordon Wilson organized Color Prints, Inc., acted as president thereof, and owned 15% of the stock. This business was not particularly profitable. In 1945, Wilson organized Tri-Color Laboratories as a sole proprietorship to take advantage of a new Printon color process, for which venture Doris Wilson's mother, Mrs. Ora Kimball, advanced $21,000. Initally Mrs. Kimball was to have a one-half interest in Tri-Color; later on, two post-dated notes were given Mrs. Kimball for this amount, which notes are still outstanding although some payments thereon have been made.

In 1945, the first of two fires occurred at the premises occupied by Color Prints, Inc. and Tri-Color; financial difficulties followed, and soon both businesses and James Gordon Wilson were being harassed by creditors. There is evidence that in 1949, Anna E. Wilson had received a life insurance payment of $1,000 upon the death of the senior Wilson which was deposited at Bank of America, Beverly-Wilshire Branch; that Anna E. Wilson wrote a check for $1,500 to Color Prints, Inc., and received in return an assignment of accounts receivable. A bank account was the opened in the name of Anna E. Wilson at the Security-First National Bank, Vermont and Sunset Branch on which account appellant James Gordon Wilson was authorized to draw checks. Mr. Wilson's accountant characterized this as 'a business account pure and simple' which 'was set up as a device to protect business funds'. This account was so maintained until July, 1953.

During this same period of financial difficulties two promissory notes secured by trust deeds covering the family home of Doris and James Gordon Wilson were executed in favor of this same Anna E. Wilson. One was dated September 24, 1949, in the amount of $7,500; the other was dated August 20, 1950, for the sum of $5,000. Anna E. Wilson testified that neither amount was ever loaned; that these instruments were 'just for temporary and were to be turned back any time.'

As pointed out in respondent's brief, 'During the same period of time that the above steps were being taken to circumvent creditors, defendant Anna E. Wilson applied for and commenced receiving Old Age Security benefits from the State of California (Rep.Tr. p. 840, lines 9-15). She 'made no misrepresentations' in her application and advised the Bureau of Public Assistance that she 'owned 'No property" * * *. She would have been ineligible for benefits if she had owned personal property of a value in excess of $1,200.00. She received said benefits continuously from the year 1949 or 1950, a year or so after her husband's death, down to the date of trial herein in the year 1955'.

After a second fire which occurred in 1950, Color Prints, Inc., was closed out as a defunct corporation; thereafter, James Gordon Wilson resumed operations under the Tri-Color proprietorship, and profits steadily increased until in the last months of 1954 when such profits amounted to $49,822.55. In July, 1952, for the alleged purpose of...