Ashton v. Thompson, 32 Minn. 25

32 Minn. 25 | Minn. | 1884

Berry, J.¹

Facts are found in this case as follows: The plaintiff was born August 16,1856, and was married to Isaiah Ashton in December, 1877. Her father, James E. Thompson, died intestate on May 27, 1870. His estate was duly administered and distributed to the defendant, who was his widow and plaintiff’s mother, and to his other heirs, and on October 5, 1871, one-fifth part of his real estate, subject to defendant’s dower, and one-sixth part of his personal property, were duly assigned to the plaintiff. The real estate, etc., assigned to plaintiff was of the value of $6,500, and the personal property of the value of $43,000. On October 5, 1873, the defendant and Horace Thompson, brother of J. E. Thompson, were duly appointed guardians of plaintiff. They qualified and entered upon their duties, taking possession of the real and personal property assigned to her, and receiving and disbursing the income and profits thereof. On October 18, 1876, the account of plaintiff’s guardians was duly allowed in the probate court, and a decree made ascertaining and to her assigning the property in their hands to her belonging. On the same day the guardians delivered to her a check, payable to her order, for $6,842.95, being the money belonging to her found in her guardians’ hands. She immediately indorsed and delivered the check to defendant. On the same day she executed and delivered to defendant four deeds, conveying all her right, title, and interest in the real estate decreed to her as above stated, and also a bill of sale conveying to defendant all the money, including the $6,842.95 above mentioned, and all the personal property of every description belonging to her and assigned to her by the decree aforesaid.

The conveyances and bill of sale embraced and conveyed all the plaintiff’s property of every description, including all income which had accrued or should accrue therefrom. Plaintiff never had in her actual possession or under her control any part of said real estate or personal property, or of the income thereof, (save the momentary possession of the check,) until July 1, 1877. No consideration whatever was paid to the plaintiff, or agreed or intended to be paid to her, by the defendant or by any one for the personal property, (including the check,) or for the real estate thus conveyed and transferred to defendant, but the same was “purely and simply a gift” from the plaintiff to her mother. “And I find as a fact,” says the trial judge, “that the plaintiff did not make said gift of her own free will; that it was not her voluntary act; but that she was moved and induced thereto by the solicitations of her mother, and through her personal influence, which then was and always had been very great over the plaintiff, and without fully understanding the character, extent, or value of her property, without due deliberation, without comprehending or realizing the fact that in executing said conveyances she was divesting herself of her entire estate, and without the counsel or assistance of a disinterested, independent adviser, and under the false impression, derived from an unsigned memorandum or draft of a will left by her father, and from conversations with and statements made by her mother, that in executing such conveyances she was carrying out the wishes and desires of her deceased father.” The deeds were duly recorded, and under them and the bill of sale, respectively, the defendant took possession of the real estate and personal property therein embraced, and collected and applied to her own use and benefit the rents, income, dividends, and profits arising therefrom, from October 18, 1876, to July 1, 1877; and also took into her possession and applied to her own use the sum of $6,482.95, represented by the check.

In February, 1877, “plaintiff for the first time became aware of and realized the fact that she had, in the manner above stated, made an absolute gift to her mother of her entire estate * * * inherited from her * * * father,” and being very anxious to regain the same, or some portion thereof, she applied to Horace Thompson and Bishop Whipple to counsel and assist her in effecting a settlement with her mother, and, they assenting, negotiations were entered into, which resulted in an agreement, evidenced by a written instrument, made June 26, 1877, between plaintiff and three of her sisters (who occupied a position analogous to that of plaintiff) on the one side, and the defendant on the other.

Referring to the reporter’s statement of the case for any fuller account of the contents of the instrument which may be deemed advisable, it is sufficient, for the purposes of this opinion, to say that by its terms the plaintiff was to surrender, give, and relinquish to defendant a considerable part (of the value of several thousand dollars, in addition to the amount of the check before mentioned, viz., $6,482.95) of the share of her father’s estate, to which plaintiff was lawfully entitled. Subject to such gift, surrender, and relinquishment, defendant was to restore to plaintiff what she had transferred to defendant by the transactions of October, 1876, before mentioned. For the surrender, gift, and relinquishment, the trial court finds that “no consideration whatever was paid or agreed to be paid” by the defendant or any other person, except the defendant’s right of dower in plaintiff’s share (one undivided fifth part) of her father’s real estate, which right of dower was of the value of $2,000, and no more. The trial court further finds as follows:

“And I find, as a fact, that said agreement, dated June 26, 1877, was executed by the plaintiff while she was a member of. the family ■of the said Susan L. Thompson, wholly dependent upon her for support, and under her habitual influence and control.

“That when the plaintiff first understood and comprehended the fact that she had, in the manner aforesaid, divested herself of her entire estate, and that she was wholly dependent upon her mother for her support and maintenance, she became very anxious that some settlement or arrangement should be made with her mother, whereby her said estate and property, or at least some portion thereof, should be reconveyed to her, and placed under her own management and control.

“The said Susan L. Thompson was strongly opposed to any such settlement or arrangement, and desired to retain said property in her possession and control, which was well known to the plaintiff.

“That such was the influence of the plaintiff’s said mother over and her attitude towards her, that the plaintiff, through fear of her displeasure, did not personally make known to her her desire that the said property should be reconveyed to her, but instead thereof applied to her said uncle and the said Whipple to aid her therein as above stated; and, after consultation between the defendants and said Whipple, and between said Horace Thompson, said Whipple, and the plaintiff and her said three sisters, the terms of said agreement were settled upon, and were assented to by the plaintiff, and thereupon said agreement was reduced to writing by the attorney of said Susan L. Thompson, and was signed by the said parties thereto, including the plaintiff.

“And although before said agreement was executed, and after the said application of the plaintiff to her uncle and the said Whipple, and after the said consultation as above stated, the said Susan L. Thompson stated to the plaintiff that if she did not desire to abide by the said conveyance of October 18, 1876, or to leave-said property in her possession — which she still insisted was the wish of the plaintiff’s said father — she was willing to transfer to the plaintiff the portion of said property to which she was by law entitled, yet I find the fact to be that the plaintiff did not sign said agreement of her own free will and accord, but that she was influenced thereto through fear of her mother, and being still under the false impression, derived from her mother, and from said unsigned memorandum left by her father as above stated, that it was the wish of her father that she should not have the possession of the whole of her said property, and in the hope of creating pleasant feelings between her mother and herself, and through her extreme anxiety that a settlement should be effected in order that she might, to some extent at least, be pecuniarily independent, and through the apprehension that unless some settlement was at that time effected, she would never regain her rights, she accepted said agreement and settlement, and consented to the concessions in favor of her mother, contained in the third, tenth, and thirteenth articles thereof, hastily, without legal advice, without knowledge or information of the value or amount of the income, dividends, rents, and other property which she thereby released, relinquished, and conveyed to her mother, and without thought or question whether she was or was not thereby receiving all her rights to which she was by law entitled as heir of her said deceased father.

“And I also find that the said Horace Thompson and the said Whipple did not, nor did either of them, nor did the said Susan L. Thompson, in any manner, or to any extent whatever, instruct, counsel, or advise the plaintiff as to her rights, or as to the extent or value of her said property, income, rents, and dividends which by said agreement she relinquished to her said mother, and that she did not receive such instruction, counsel, or advice from any other person or source whatever, and that she did not have the benefit of an independent adviser in said settlement.”

The terms of the agreement evidenced by the instrument of June 26, 1877, were on August 24, 1877, carried out by proper conveyances, transfers, and other proceedings on both sides, and without further consideration to the plaintiff than as before stated. The defendant departed from this state and from the United States in September, 1877, and did not return to this state until June, 1879. This action was commenced in July, 1879.

So far as deemed important upon this appeal this is the substance of the findings of fact. In our opinion they are substantially sustained by competent evidence reasonably tending to support them. With the exception of that given by defendant herself, the testimony was oral. The case was one calculated to arouse considerable feeling in the family of which most of the witnesses (the defendant and her daughters) were members. That there was more or less conflict in the evidence is therefore not at all surprising, and the case is emphatically one in which the learned and experienced trial judge, who saw and heard the witnesses, was in a position to arrive at the facts far superior to that occupied by this court, which can look only at the printed record. Besides, a motion for a new trial upon the ground, among other things, that the findings of fact were not justified by the evidence, was heard before the three judges of the district court for Ramsey county, sitting in bank, and denied. In these circumstances it would require a far stronger ease than is presented here to induce us to disturb a finding as against evidence.

As conclusions of law the trial court finds, among others, the following : That, as against the plaintiff, the deeds and bill of sale of October 18, 1876, and the agreement and settlement of June 26, 1877, and the conveyance made by plaintiff in pursuance thereof on August 24, 1877, are null and void; that the deeds and conveyances executed by defendant on or about August 24, 1877, in and by which she reconveyed to the plaintiff the real estate which plaintiff had before conveyed to her, and by which she relinquished her right of dower therein, and by which she relinquished to plaintiff the stocks, bonds, and other personal property before conveyed to her by plaintiff, are null and void; that plaintiff is entitled to an accounting by defendant of all and singular the income, dividends, issues, rents, and profits which accrued from said above-described real estate, and from said stocks, bonds, and other personal property which belonged to the plaintiff, as heir of James E. Thompson, and were assigned to her by the decree of the probate court, from the seventeenth day of October, 1S76, up to and including the first day of July, 1877, and for said sum of $6,482.95, (represented by the check,) and for the sum of $3,000 paid by plaintiff to defendant under the agreement of June 26, 1877, and for the value of plaintiff’s interest in the household furniture and other personal property, also conveyed under said agreement, August 24, 1877; and that the defendant is entitled to an accounting by plaintiff of the value of her dower right, aforesaid, since July 1, 1877. Judgment was directed accordingly. Speaking generally, the substantial effect of these findings of law would appear to be to restore the plaintiff and defendant, respectively and relatively to each other, to the position occupied by each on October 17, 1876, after the decree of the probate court assigning to plaintiff her share in her deceased father’s estate.

The record is unusually voluminous, and the case was discussed by counsel at great length, and from many points of view. Questions of pleading and practice were raised, as well as very many upon the merits. "While we have endeavored to duly consider all that was urged by counsel, we have come to the conclusion that the case lies in a comparatively narrow compass, and may fairly and justly be determined by the application of a few well-settled rules of equity. To these we will mainly confine ourselves, without consuming time or space in taking up the positions of counsel in detail.

Upon grounds of public policy, or, as it is otherwise expressed, of public utility, equity exercises a salutary jurisdiction in setting aside donations of property made to a donee who stands in some confidential or fiduciary relation to the donor. The relief granted in such cases rests upon a general principle applicable to all relations in which dominion is exercised by one person over another. Dent v. Bennett, 4 Mylne & Cr. 269; 1 Story, Eq. Jur. §§ 307, 308; Rockafellow v. Newcomb, 57 Ill. 186. The confidential relation of parent and child, and the fiduciary relation of guardian and ward, are among those in which such relief is frequently granted. Equity looks with special jealousy upon donations from a child to a parent when made recently after the child comes of age, or while he is under the constant and immediate influence of the parent, (as, for instance, residing with him,) or while his property is in the parent’s possession or control. Wright v. Vanderplank, 8 De Gex, M. & G. 133; Baker v. Bradley, 7 De Gex, M. & G. 597; Bergen v. Udall, 31 Barb. 9; Taylor v. Taylor, 8 How. 183; 2 Pom. Eq. Jur. § 961. Donations from a ward to his guardian are regarded with still greater jealousy where the circumstances are such as to give the guardian an ascendency over the ward, for here the natural and mutual ties and obligations between parent and child are wanting, and the position of the guardian is fiduciary. Hylton v. Hylton, 2 Ves. Sr. 547; Hatch v. Hatch, 9 Ves. 292, and note; Fish v. Miller, Hoff. Ch. 267; 2 Pom. Eq. Jur. § 962. Whether the donation be from a child to a parent or by a ward to his guardian, if the donor is so placed as to be subject to the control or influence of the donee, the onus is on the parent or guardian (as the case may be) to show that “the transaction is righteous.” Gibson v. Jeyes, 6 Ves. 266; Hoghton v. Hoghton, 15 Beav. 278, 299. In such cases the undue influence is, on grounds of public policy, prima facie presumed from the peculiar relations subsisting between the parties. Archer v. Hudson, 7 Beav. 551; Hylton v. Hylton, supra; Hatch v. Hatch, supra; Kerr on Fraud & Mistake, 178, 179; Williams v. Powell, 1 Ired. Eq. 460; Chambers v. Crabbe, 34 Beav. 457; Garvin v. Williams, 44 Mo. 465; Todd v. Grove, 33 Md. 188; Berdoe v. Dawson, 34 Beav. 603; Huguenin v. Baseley, 2 Lead. Cas. Eq. [556] and notes; 2 Pom. Eq. Jur. §§ 961, 962. Substantially the same rules are applied to the case of an ex-guardian, where, notwithstanding the termination of the formal fiduciary relation between him and his ward, he still retains his dominion in fact and his position of influence as respects the ward or his property. This is especially true where the donations called in question are made while (even after his majority) the ward continues to reside with the ex-guardian, or the ex-guardian continues to retain possession or control of the ward’s property. Hylton v. Hylton, supra; Hatch v. Hatch, supra; Pierse v. Waring, 1 P. Wms. 121, note; 1 Story, Eq. Jur. § 317; 2 Pom. Eq. Jur. § 961. In all these cases where the law infers from the relations of the parties the probability of undue influence on the part of the party having dominion or ascendency over another, it requires that the influence in fact exercised shall be exerted for the benefit of the person subject to it, and not for the benefit of the party possessing it, otherwise the' donations will be promptly set aside. Hoghton v. Hoghton, supra; Cooke v. Lamotte, 15 Beav. 234. These principles govern the case at bar, and uphold the conclusions of law found by the trial court.

The defendant sustained a double relation to the plaintiff: First, the confidential relation of parent; second, the fiduciary relation of guardian. The plaintiff resided with the defendant as a member of her family, and under her habitual influence and control at the time of the transactions of October 18,1876, when plaintiff was a little over 20 years old, and up to September, 1877. The agreement of June 26, 1877, was executed by plaintiff, and on her part performed, while she was a member of defendant’s family, wholly dependent upon her for support, and under her habitual influence and control, and while she held in her possession and control the entire property which plaintiff had inherited from her father, and had bestowed upon her as a pure gift, unsupported by any consideration. In fact, with the exception of her momentary possession of the check before mentioned, the plaintiff never had any possession or control of any part of her inheritance until after the execution and performance of the agreement of June 26, 1877. By that agreement the transactions of October 18, 1876,, were overhauled, and a portion of the plaintiff’s inheritance restored to her; but nevertheless defendant retained, took, and held a considerable part thereof, of the value of several thousand dollars, in addition to the check of $6,182.95, all for no consideration other than the release of a dower right of the value of $2,000. That the transaction of October 18, 1876, was a “righteous” one, and ought ever to have been consummated or be permitted to stand, is hardly claimed. That it ought to be set aside is manifest upon the plainest principles of equity.

The substance of the finding of the court (heretofore recited- at length) is that the agreement of June 26, 1877, was made and consummated when the plaintiff was a member of defendant’s family, wholly dependent on her for support, and under her habitual control; that in executing the same plaintiff was not a free agent, but that she executed it without full knowledge or appreciation of her rights, and under the influence 'of fear of her mother, in hope of restoring pleasant relations with her, 'and in the apprehension (in view of the-transactions of October 18, 1876) that unless a settlement was then effected she would never regain her rights, but would remain pecuniarily dependent upon her mother. Upon the findings the case is, then, one of a parent and ex-guardian retaining and having dominion and ascendency over the child and ward, and her property, who for a grossly inadequate consideration — in effect, largely by gift — has obtained a considerable portion of the property of the child and ward. So far from defendant’s successfully bearing the burden of showing that the transaction was a “righteous” one, that it was the free act of the donor, accomplished with a full knowledge of her rights and of all the material facts, and so far from any rebuttal of the presumptions (before spoken of) against its validity, (in view of its attending circumstances,) it appears that the execution of the agreement wasbrouglit about by the influence of the defendant, exerted, not for the advantage of the plaintiff, but for the defendant’s own benefit. The-contrary of this has been well said to be an “inseparable condition” •of the validity of such a transaction. Hoghton v. Hoghton, supra.

Upon the findings of fact, the case is clearly one of the use of undue influence by the plaintiff in obtaining that which she ought not to have, and should not be permitted to retain. The facts hardly present the case of a family settlement, such as are referred to by defendant’s counsel. There was no dispute as to legitimacy,— no ground for any controversy or difference of opinion as to the plaintiff’s rights as her father’s heir. These latter were explicitly and definitely fixed by statute. Nor was there any family settlement, or attempt at one, in the sense of making provision for other members of the family, defendant excepted. See Chambers v. Crabbe, 34 Beav. 457; 1 Story, Eq. Jur. § 309a.

Defendant’s counsel have laid much stress upon the fact, as they claim it, that defendant, in the transaction of June, 1877, had the benefit of competent and independent advice. The court has found the fact otherwise, and we are not prepared to say that the finding is not sustained by the testimony. But if this were not so, and the fact was that the plaintiff had competent and independent advice in the premises, the question would still remain whether, she and her property •being under the dominion and control of the defendant, the plaintiff acted under the advice, or under influence of the defendant unduly and improperly exerted for her own advantage. An analogous remark would be applicable to plaintiff’s knowledge and appreciation •of her rights, and of what she was doing. As remarked by Lord Eldon, (p. 300,) the crucial question in cases of this kind “is not whether she knew what she was doing, had done, or proposed to do, but how -the intention was produced; whether all that, care and prudence was placed around her, as against those who advised her, which, from their situation and relation with respect to her, they were bound to exert in her behalf.” Huguenin v. Baseley, 14 Ves. 273; Hoghton v. Hoghton, supra.

This is all that we deem it necessary to say about the case, or the numerous points made and discussed by counsel.

The order refusing to vacate the decision below and to grant a new trial is affirmed.

1 GHlfillan, O. J., and Dickinson, J., did not hear the argument or take part in the decision of this case.