Workman v. Douglas

• Decision Date: 12 May 1981
• Docket Number: No. 1-980A251,1-980A251
• Citation: 419 N.E.2d 1340
• Parties: Buford WORKMAN, Plaintiff-Appellant, v. Betty DOUGLAS, Defendant-Appellee, and Steven R. Douglas, Third Party Defendant-Appellee.
• Court: Indiana Appellate Court

Page 1340

419 N.E.2d 1340

Buford WORKMAN, Plaintiff-Appellant, v. Betty DOUGLAS, Defendant-Appellee and Steven R. Douglas, Third Party Defendant-Appellee.

No. 1-980A251.

Court of Appeals of Indiana, First District.

May 12, 1981.

Robert L. Dalmbert, Dalmbert & Marshall, Columbus, for plaintiff-appellant.

Richard S. Eynon, Columbus, for defendant-appellee.

NEAL, Presiding Judge.

This is an appeal by plaintiff-appellant Buford Workman (Workman) from a judgment in the Bartholomew Circuit Court in favor of a counterclaim filed by defendant-appellee Betty Douglas (Betty) on a theory of a resulting trust.

We reverse.

STATEMENT OF THE FACTS

Steven and Betty Douglas were a young married couple desiring a better home. Being unable to finance a new home, they approached Buford Workman, a friend with whom Steve had lived as a child, to solicit his aid. Workman purchased a home from Mr. and Mrs. John Ritzenthaler for $15,000; and title was recorded in Workman's name on April 5, 1974. He made a $3,000 down payment and obtained a mortgage from a financial institution for $12,000 at 8.5 percent interest, payable over 25 years with monthly payments of $96.80. Without drawing a contract or any other writing, Steven and Betty moved into the home. Though Workman contended the transaction between himself and Steven and Betty was a rental, they testified it was their impression, based upon all the conversations, with Workman, they had contracted orally to buy the house for $96.80 per month for 25 years, at which time it would be legally theirs. Steven and Betty testified they understood the purchase price to be $15,000; however, the record is silent as to how they had decided to pay back Workman's $3,000 down payment, if at all. Calculation reveals that the payment of $96.80 per month for 25 years would retire only the $12,000 loan. No mention is made in the record of the payment of taxes, repair, insurance on the property or the rights of the parties in the event of a default. Steven and Betty never insured the house, but claimed they paid taxes on it for two years, and then, for obscure reasons, ceased. The evidence does not disclose Steven and Betty ever made a down payment on the home at or prior to the time Workman took title on April 5, 1974.

In 1979, Steven and Betty were divorced, and Betty received the property pursuant to the divorce decree. At this time they were in arrears on the $96.80 monthly payments in the approximate amount of $1,152. Workman filed suit for the rent arrearages, damages in the amount of $270, and possession of the real estate. Betty filed a counterclaim upon a theory of a resulting trust under Ind.Code 30-1-9-8 alleging there was an oral contract to purchase the home for $15,000, payment of $1,000 down, and $96.80 per month for 25 years with interest at 73/4 percent. In the prayer of her complaint, Betty asked the trial court to declare a resulting trust, constructive trust, or to issue an order estopping Workman from denying the contract.

Upon a trial before the court, special findings of facts and conclusions of law were entered in which the trial court found as follows: 1) that an oral contract of sale existed, 2) that Steven and Betty had paid valuable consideration, 3) that Workman had given a mortgage on the property for $12,000 to be paid in 25 years at $96.00 per month, and 4) that Steven and Betty, upon making those payments, were to receive the property. The trial court's findings Nos. 11, 12, and 13, its conclusions, and judgment are set out verbatim as follows:

"11. Burford V. Workman should be estopped from refuting the April, 1974 agreement he entered into with the Douglases, and a resultant trust should be found to have arisen in favor of Betty Douglas concerning her continued status as a purchaser of the subject real estate and the identification of Buford V. Workman as vendor of the same;

12. The parties should be ordered to enter into a written contract for the sale of the subject real estate by Workman to Betty Douglas, provided that Betty Douglas shall first pay to Buford V. Workman on or before the 2nd day of May, 1980, the sum of Fifteen Hundred Twenty nine Dollars Thirty Five cents ($1,529.35) and make a payment of Ninety-six Dollars ($96.00) on or before May 5, 1980, and if Betty Douglas shall fail to make such payments when the same are due, then Burford V. Workman should have judgment for such sums and be entitled to immediate possession of the subject real estate;

13. The contract for the sale of the subject real estate should be prepared in a form similar to that published by the Indianapolis Bar Association or the Allen County, Indiana, Bar Association, and the contract should call for payment of real estate taxes by the vendor and insurance of the dwelling house by the purchaser in an amount of at least Eighty-five percent (85%) of the replacement costs of the subject dwelling house, and the terms of the sale should be set down as a balance owed of Ten Thousand Nine Hundred Seventy-one Dollars Forty-eight Cents ($10,971.48) to be paid in equal monthly installments of Ninety-six Dollars ($96.00) principal and interest included, at an annual percentage rate of eight-and-one-half percent (81/2), such payments to continue over approximately Two Hundred Thirty-five (235) months, with the first such payments to be made on or before June 5, 1980.

IT IS THEREFORE, ORDERED, ADJUDGED AND DECREED as follows:

1. Buford V. Workman, plaintiff herein, shall have judgment against Betty Douglas, defendant herein, for the sum of Fifteen Hundred Twenty-nine Dollars and thirty-five Cents ($1,529.35) on the 2nd day of May, 1980, and for the sum of Ninety-six Dollars ($96.00) on the 5th day of May, 1980, and possession of the following described real estate more commonly known as 1904 Keller Avenue, Columbus, Indiana:

Lot Numbered One Hundred Twenty-two (122) in George W. Caldwell's Addition to the City of Columbus, Bartholomew County, State of Indiana.

2. However, if Betty Douglas shall pay such hereinabove described sums to Buford V. Workman on or before the respective dates the same are due, then she shall be entitled to remain in possession of the subject real estate and the parties shall enter into a written contract for the sale of the real estate by Buford V. Workman to Betty Douglas, which contract

shall be subject to approval by the Court and shall be in a form similar to that published by the Indianapolis Bar Associate (sic) or the Allen County Bar Association, and which contract shall provide for payment of real estate taxes by the vendor and insurance of the subject property in an amount equal to at least Eighty-five percent (85%) of its replacement cost value by the purchaser, and which purchase price shall be set down at Ten Thousand Nine Hundred Seventy-one Dollars Forty-eight Cents ($10,971.48) with payments thereon to be made in equal monthly installments of Ninety-six Dollars ($96.00), consisting of principal and interest, with interest at an annual rate of Eight-and-one-half percent (81/2%), such payments to continue for approximately Two Hundred Thirty-five (235) months, or until the purchase price is paid."

ISSUES

Workman presents four issues for review wherein he contends:

I. The trial court erred in finding that the parties entered into an oral contract and that the same was valid and that a resulting trust exists in favor of the appellee, Betty Douglas;

II. The trial court erred in ordering the parties to enter into a written contract embodying certain terms and conditions;

III. The trial court erred in permitting, over objection, oral testimony concerning the terms and conditions of a decree of dissolution and by indicating that it would take judicial notice of such decree; and

IV. The trial court erred in not finding any contract that may have been entered into in default.

DISCUSSION AND DECISION

Issue I. Existence of a resulting trust

The sole issue raised by the parties is the theory of a resulting trust. The trial court, upon entering its own findings, concluded that a resulting trust had arisen in favor of Betty.

Our standard of review as stated by Ind.Rules of Procedure, Trial Rule 52(A) requires us to uphold the trial court's findings of fact or judgment unless "clearly erroneous." Furthermore, T.R. 52(A), in relevant part, states:

"Upon its own motion, or the written request of any party filed with the court prior to the admission of evidence, the court in all actions tried upon the facts without a jury ... shall find the facts specially and state its conclusions thereon." (Emphasis added.)

This court, in Blade Corp. v. American Drywall, Inc., (1980) Ind.App., 400 N.E.2d 1183, 1185, stated:

"It is well-established that this court will not reweigh conflicting evidence on appeal. We will consider only that evidence which tends to support the trial court's findings of fact, conclusions of law, and judgment, together with all reasonable inferences which may be drawn therefrom. If, from that perspective, there is sufficient evidence to support the trial court's judgment, we must affirm. Shahan v. Brinegar, (1979) Ind.App., 390 N.E.2d 1036. We are cognizant that the trial court's findings are not to be set aside on appeal unless clearly erroneous, Ind.Rules of Procedure, Trial Rule 52(A), and that a trial court's judgment will be determined to be clearly erroneous only after a review of the evidence leaves us with a definite and firm conviction that the trial court erred. University Casework Systems, Inc. v. Bahre, (1977) Ind.App., 362 N.E.2d 155.

Judge Garrard, in In Re the Marriage of Miles, (1977) 173 Ind.App. 5, 362 N.E.2d 171, rendered a thorough treatment on the matter and stated:

"(T)he purpose of special findings is to provide the parties and reviewing courts with the theory on which the judge decided the case in order that the right of review for error may be effectively preserved. Miller v. Ortman (1956), 235 Ind. 641, 136...