Young v. Fawcett
| Decision Date | 26 July 2012 |
| Docket Number | No. 09–11–00391–CV.,09–11–00391–CV. |
| Citation | 376 S.W.3d 209 |
| Parties | Stephen YOUNG and Kimberly Young, Appellants v. Lenora FAWCETT, Appellee. |
| Court | Texas Court of Appeals |
OPINION TEXT STARTS HERE
Robert E. Price, Houston, for appellants.
Bruce Gregory, Gregory Law Firm, Port Neches, for appellee.
Before McKEITHEN, C.J., GAULTNEY and KREGER, JJ.
Kimberly Young and Stephen Young challenge the sufficiency of the evidence to support the jury's finding that a fiduciary relationship existed with Kimberly's grandmother, Lenora Fawcett. The Youngs also challenge the imposition of a constructive trust on their property. We hold that the jury's finding is supported by the evidence, and that a constructive trust is an appropriate remedy under the circumstances. The judgment of the trial court is affirmed.
After two strokes, Lenora decided to build her house behind her daughter's house on her daughter's land. Her daughter assured her she could live there the rest of her life. Lenora paid her son-in-law “[e]verything I had, $40,000” to build the house. He assured her the house would be nice, because when Lenora died the house would be his.
Lenora testified:
Q. Did you think that they would eventually get the house that you built?
A. I expected that they would outlive me; and—and, if I should go first, naturally the house would be theirs.
Q. So, how long did you intend to live in that house?
A. I intended to live there till the day I died.
Q. Okay. Did anybody say anything to make you believe that would happen?
A. Yes, when I talked to my daughter about building the house.
And I said,
And she says, “And we'll always be here.” She said, “Don and I love our home, and we will be here.”
When Lenora's son-in-law died, her daughter Debbie was unable to pay the mortgage on her own house. Kimberly and her husband Stephen purchased the property, but at a price which the jurors could reasonably infer did not reflect the value of the house Lenora had built on the property. The foreclosure that was avoided was on the daughter's mortgage. Over time, the Youngs spent approximately $35,000 in making improvements to the property.
All parties understood Lenora's house was built with Lenora's money, and she would live there. When Kimberly and Stephen bought the property, the agreement between Lenora and her daughter had been followed: Lenora's house had been built, she had fully paid her son-in-law, and she was living there. See generally Swinehart v. Stubbeman, McRae, Sealy, Laughlin & Browder, Inc., 48 S.W.3d 865, 882–83 (Tex.App.-Houston [14th Dist.] 2001, pet. denied) (partial performance). Lenora indicated she did not remember having any specific discussion about the house with Kimberly and Stephen either around the time they bought the property or shortly thereafter. But the evidence indicates Kimberly and Stephen accepted the arrangement in purchasing the property. See generally Providian Nat'l Bank v. Ebarb, 180 S.W.3d 898, 901 (Tex.App.-Beaumont 2005, no pet.) (ratification). Kimberly testified that “when we bought the house, we bought the house to let everybody stay in a house.” Lenora paid $150 a month to Kimberly and Stephen for what Lenora understood were taxes and insurance, although Kimberly and Stephen testified the $150 was to help with utilities.
Kimberly and Lenora were close. Lenora had been involved in Kimberly's life from the day Kimberly was born. After Kimberly was grown, she took Lenora on trips with her. She and Stephen called Lenora “Mom.” After the Youngs bought the property, Lenora continued to live in her house for seven more years.
Kimberly and Stephen knew Lenora trusted them to let her live there as she had been doing, and, if they sold the property, to give her money for her house. Lenora indicated the Youngs did not discuss with her a specific dollar amount that they would pay her after the property was sold. But Kimberly testified, “I knew [Lenora] intended it to be $40,000 ‘cause she had told my mother that.’ ” Kimberly explained they told Lenora they would help her out, but never told her they would pay her for her house. Kimberly testified they agreed for Lenora “to stay back there and live in that house while we were up there[,]” but there was no agreement she could stay there for life. When Kimberly and Stephen decided to sell the property, they knew that Lenora paid to have her house built and expected to be compensated.
One of the reasons Kimberly and Stephen were able to sell the property at an increased price was the presence of Lenora's house on the property. The purchasers wanted two houses. Lenora's house was valued by the appraisal district as worth $37,162. Lenora presented expert testimony that her house contributed about $27,500 to the sales price the Youngs were able to obtain.
Assurances were made to Lenora. Stephen, in Kimberly's presence, assured Lenora that “[w]e're selling the house, but don't worry because we're gonna give you some money for your house.” Stephen testified:
The evidence indicated a confidential relationship of trust existed.
After Kimberly and Stephen sold the property for $199,900, Kimberly sent Lenora a letter by certified mail with a $6,000 check enclosed—a check that Kimberly and Stephen never honored. In the letter, Kimberly acknowledged that the amount was less than Lenora expected to receive from the sale, but Kimberly told Lenora that the amount they received for the property (a little over $110,000 net cash) was less than they had expected.
At the time of the sale, Lenora had fractured her knee and was receiving rehabilitation at a medical care facility. The Youngs and other family members packed up her home furnishings and personal belongings and placed them in a rented storage unit until Lenora was able to find another place to live and retrieve her belongings.
Kimberly wrote Lenora this explanation:
Mom,
I apologize for it taking so long we've been out of town for the past month (alot)....
I wish that things werent so hard for you it wasn't our intensions on doing this to you. I understand that its been stressful for alot of people. Enclosed is a check that will hopefully get you on your feet. I'm sorry that its not the amount you intended it to be, but we weren't able to sell the house for what we thought we were. I hope there's no hard feelings. This has been a very difficult situation for us and we know its been difficult for you as well. We love & miss you. We would love for you to come visit us one day when you are feeling better.
Love you,
Instead of paying Lenora anything for her house from the sale proceeds, however, Kimberly and Stephen used the money to pay their credit card bills, to pay their car loan, to pay a loan on a trailer house, to buy a truck, and to build a new house on fourteen acres, a property valued at $335,000.
To address a legal sufficiency challenge, an appellate court reviews the entire record, and credits favorable evidence if reasonable jurors could, and disregards contrary evidence unless reasonable jurors could not. See City of Keller v. Wilson, 168 S.W.3d 802, 827 (Tex.2005). We must assume in this case that the jurors decided questions of credibility or conflicting evidence in favor of Lenora if they reasonably could do so. Id. at 819–20. The test for legal sufficiency is whether the evidence at trial would enable reasonable and fair-minded people to reach the verdict under review. Id. at 827. If the evidence “would enable reasonable and fair-minded people to differ in their conclusions, then jurors must be allowed to do so.” Id. at 822. An appellate court cannot substitute its judgment for that of the trier-of-fact if the evidence falls within the “zone of reasonable disagreement.” Lee v. Hasson, 286 S.W.3d 1, 13 (Tex.App.-Houston [14th Dist.] 2007, pet. denied) (citing City of Keller, 168 S.W.3d at 822). When a court of appeals reviews a jury finding for factual sufficiency, the court considers and weighs all the evidence and concludes that the finding is not supported by factually sufficient evidence only if the finding is so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust. Id. at 14 (citing Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986)).
Kimberly and Stephen contend that no fiduciary relationship existed, that they never held or administered property owned by Lenora, and that the trial court could not impose a constructive trust in Lenora's favor. The Youngs do not challenge the phrasing of the jury questions or the amount ($37,162) of the damages the jury awarded.
“The term ‘fiduciary’ refers to a person owing a duty of integrity and fidelity, and ‘it applies to any person who occupies a position of peculiar confidence towards another.’ ” Hasson, 286 S.W.3d at 14 (quoting Kinzbach Tool Co. v. Corbett–Wallace Corp., 138 Tex. 565, 160 S.W.2d 509, 512 (1942)). The Supreme Court has explained that the term “contemplates fair dealing and good faith, rather than legal obligation, as the basis of the transaction.” Tex. Bank & Trust Co. v. Moore, 595 S.W.2d 502, 507 (Tex.1980). A fiduciary duty may arise from an informal...
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