Windle v. Flinn

• Citation: 196 Or. 654,251 P.2d 136
• Parties: WINDLE et al. v. FLINN et al.
• Decision Date: 03 December 1952
• Court: Supreme Court of Oregon

Page 136

251 P.2d 136

196 Or. 654

WINDLE et al. v. FLINN et al.

Supreme Court of Oregon.

Argued and Submitted Oct. 17, 1952.

Decided Dec. 3, 1952.

James C. Dezendorf and William F. Lubersky, of Portland, argued the cause for appellants. On the briefs were Koerner, Young, McColloch & Dezendorf, William F. Lubersky and James H. Clarke, of Portland.

Will H. Masters, of Portland, argued the cause for respondents. On the brief were Masters & Masters, of Portland.

Before BRAND, C. J., and ROSSMAN, LUSK, LATOURETTE and WARNER, JJ.

WARNER, Justice.

Mary M. Windle, the appellant, is impleaded as a party plaintiff in two different capacities: (1) as the administratrix of the estate of J. E. Windle, her deceased husband, and (2) in her individual capacity. The status of Mildred Windle Flinn, Jeanette Windle Andrews, June Windle Stout and Carmen Windle of the defendants-respondents is not disclosed by the complaint nor is any relief requested for or against either of them. The defendant-respondent, Will H. Masters, trustee, is alleged to be the trustee under the purported instrument which occasions this litigation. All of the defendants successfully demurred to plaintiffs' complaint on the ground that it did not state sufficient facts to constitute a cause of suit. A first amended complaint was thereafter filed; but before the defendants made any plea to the same, the plaintiffs, on leave of court, filed a second amended complaint. The defendants demurred to this third pleading upon the same ground, with like result. Upon plaintiffs' refusal to seek an opportunity to plead further, the suit was dismissed. From the order of dismissal, the plaintiffs appeal.

The ultimate and only question for determination is whether the court erred in dismissing the suit as framed by the second amended complaint.

The last amended complaint alleges:

'I

'That J. E. Windle died intestate in Multnomah County, Oregon on the 19th day of September 1943 and was at the time of his death a resident of the County of Washington, Oregon being temporarily in Portland, Oregon for hospitalization, and that the plaintiff Mary M. Windle is the duly appointed, qualified and acting administratrix of the estate of the said J. E. Windle, deceased, under and by virtue of letters of administration duly issued to her out of the County Court of the State of Oregon for the County of Washington and is duly authorized and directed by order of the said County Court to prosecute this suit as such administratrix.

'II

'That said plaintiff Mary M. Windle in her individual capacity is the widow of said J. E. Windle, deceased, with whom she intermarried on the 22nd day of February 1918 and at all times thereafter until the death of said J. E. Windle, was his lawful wife.

'III

'That at the time of the death of the said J. E. Windle, deceased, there were a number of judgments of record against him in the Circuit Court of the State of Oregon for the County of Multnomah as follows:

State of Oregon v. J. E. Windle dated December 20, 1938--$36.42

Lowell Mortgage & Adjustment Co. v. J. E. Windle dated October 20, 1939--$4,000.00 and costs $880.00.

State of Oregon v. J. E. Windle dated June 26, 1940--$6.52.

United States v. J. E. Windle dated April 25, 1942--$3,771.59.

Mary Myrl Windle v. J. E. Windle dated April 25, 1942--$1,000.00.

and also thirteen judgments of record in the District Court of the State of Oregon for Multnomah County, certain of which are also against this plaintiff in her individual capacity and which render it difficult for her to retain employment which is very essential as she is without funds.

'IV

'That since the death of the said J. E. Windle and the appointment of plaintiff as administratrix of his estate the following claims have been presented against his estate, all of which have been examined and approved by said administratrix, as follows:

Dr. Dorothy M. Johnstone $840.00

Portland Sanitarium 229.30

Dr. Chester O. Nugent 154.00

Collector of Internal Revenue 4,752.18

'In addition to the above claims plaintiff, as surviving spouse of said deceased, has been granted a family allowance of $2,400.00 by the said County Court.

'V

'That there is no money or other property which can be reached by plaintiff administratrix for the purpose of paying the claims against the estate of the said J. E. Windle, deceased, or the expenses of the administration thereof and it will be necessary for plaintiff administratrix to acquire possession of and to sell any property belonging to said estate for the purpose of raising funds with which to pay the just debts of said decedent and the expenses of administration of his estate.

'VI

'That prior to and at the time of his death, said J. E. Windle was the owner of, and exercised full control and management of and enjoyed the income and benefits from all property carried in the name of the Oregon Realty Co., although said property purportedly was held under the terms of a certain Trust dated March 4, 1938 whereby the capital stock of Oregon Realty Co., was assertedly transferred to defendant Will H. Masters as Trustee.

'VII

'That on or about March 4, 1938 at the time of the execution of said purported Trust, the said J. E. Windle was living with a woman other than plaintiff; that he had been unsuccessful in persuading plaintiff to grant him a divorce and was himself preparing to bring a divorce action against plaintiff.

'VIII

'That subsequently on July 19, 1939 said J. E. Windle filed suit for divorce against plaintiff in Multnomah County, and after trial on the merits said suit was dismissed on April 24, 1942 and plaintiff was awarded alimony of $75.00 per month, $250.00 costs and $750.00 attorneys' fees, no part of which award has been paid. On January 8, 1943, plaintiff filed suit for divorce against said J. E. Windle in Multnomah County, which suit was pending at the time of the decease of said J. E. Windle.

'IX

'That said purported Trust Agreement of March 4, 1938 was the final and culminating step in a series of purported trusts entered into by said J. E. Windle or on his behalf in furtherance of a fraudulent and mala fide scheme designed to vest and retain in the said J. E. Windle the control, management and fruits of his property, while at the same time to divest the rights of his creditors and in particular the rights of the plaintiff as his wife against his income and property either for support, maintenance or alimony or as surviving spouse upon his death.

'X

'That under said purported Trust of March 4, 1938 the active and direct management and control of said Oregon Realty Co. and of the properties held in the name of said corporation were vested and retained in the said J. E. Windle; the said J. E. Windle had and retained the right to use and enjoy said properties as though no such Trust Agreement had ever existed; the defendant Will H. Masters was required to vote the shares of stock in said corporation in accordance with the written instructions of said J. E. Windle; the defendant Will H. Masters was required to pay over to said J. E. Windle during his lifetime the entire net income derived from said corporation; the tenure of said Will H. Masters as Trustee was completely dependent upon the will and whim of the said J. E. Windle to whom the right to change trustee was reserved; the compensation of the Trustee was limited to such reasonable sum as might be agreed upon between the Trustee and the said J. E. Windle; the Trustee was, by the said purported Trust, released and relieved from responsibility for acts or things done by the said J. E. Windle during his lifetime while J. E. Windle was managing properties under said purported Trust and carrying on the business of the properties of the said J. E. Windle which were supposedly a part of the said purported Trust corpus.

'XI

'That said J. E. Windle did not in fact give up ownership, dominion, control, use and enjoyment of the property included under said purpoted Trust; that on the contrary, said J. E. Windle exercised full control and management of the property included in said purported Trust and enjoyed the income therefrom and the benefits thereof and dealt with the same as if no Trust had in fact been created, and during said period said defendant Will H. Masters was in fact without discretion and without authority with regard to said property, and in fact the ostensible creation of said Trust was a patent veil for the continued control, use and enjoyment of the said property by the said J. E. Windle.

'XII

'That plaintiff has no plain and speedy remedy at law.'

This was followed by the prayer wherein plaintiff asked for judgment and decree essentially as follows: (1) Adjudging that said purported trust agreement dated March 4, 1938, is illusory and void and that all property included therein passes to the heirs at law of the said J. E. Windle; (2) adjudging that said purported trust agreement is fraudulent and void as against the creditors of the estate of said J. E. Windle, deceased, and particularly against the plaintiff as a quasi creditor and as surviving spouse of said J. E. Windle, deceased; and (3) that the defendants and each of them be enjoined and restrained from selling, charging or in any way dealing with any of the shares in said Oregon Realty Co. or any of the property owned by said corporation during the pendency of the suit.

The alleged trust agreement is not made an exhibit to the second amended complaint and, therefore, our entire knowledge of its contents is found solely in the allegations of the pleading to which the demurrer was addressed.

The rules which govern our inquiry have been well and long established. A complaint when challenged by demurrer is to be construed most strongly against the pleader. Musgrave v. Lucas, 193 Or. 401, 408, 238 P.2d 780; Aune v. Oregon Trunk Railway, 151 Or. 622, 626, 51 P.2d 663; Brosius v. Hazelwood, 127 Or. 635, 637, 271 P. 992. The pleader is presumed to have stated his case as...