Respondents Owen and Eleanor Hartog brought an action in the Circuit Court of Gasconade County for partition of a 126 acre tract of land situated in Gasconade County and asserted an equitable lien against the property for reimbursement of improvement, maintenance and repair expenditures. The Hartogs and appellant, Paul Siegler, each held an undivided half-interest in the property, and all co-tenants stipulated to the partition sale. Owen Har-tog and his sister, Harriett Siegler, had acquired the property from respondent, Haroco Corporation in 1967. At the sister’s death in 1968, her son, appellant Paul Sie-gler, had inherited her half-interest in the property in trust, and Hartog had been appointed trustee. Respondent Haroco Corporation intervened in this action to assert a lien against the property for Haroco’s payment of a promissory note on behalf of the co-tenants. The Circuit Court of Gasco-nade County awarded the Hartogs $15,-243.62, plus reasonable attorney’s fees from the proceeds of the sale of the tract, and also awarded Haroco $15,128 from said proceeds.
Appellants claim that Hartog incurred expenses as a volunteer, breached his fiduciary duty as trustee to render accurate accounting of his trusteeship, and therefore was not entitled to reimbursement. They also contest particular expenses claimed by Hartog. Appellants assert that Haroco’s claim was based on insufficient evidence as to Harriett Siegler’s intent to pledge the property as security with respect to payment of the note.
Haroco Corporation is a closed Missouri corporation whose principal dealings are in real estate. In 1967 Owen Hartog, his sister, Harriett Siegler, and their mother held all of Haroco’s common stock. Hartog held 40% of the stock and was president of the corporation; his sister held 30% and was secretary. In April, 1967, Haroco acquired by warranty deed the 126½ acre farm which is the subject of this suit, subject to a
At that time the house on the tract had been “uninhabitable,” and the barn had “required a lot of work.” Hartog and his sister orally agreed to modernize the farm for use as a weekend residence, and they began to make repairs and improvements. They continued an arrangement by the previous owner with a local farmer who sharecropped the ground and paid rent for pasture land. On October 5, 1967, Hartog and Mrs. Siegler borrowed $7,000.00 from a bank to reimburse themselves for personal expenditures on the property. After Har-tog personally had spent $5,899.33 on building materials, they initiated a separate checking account for all farm expenditures.
On or about October 30, 1967, Haroco conveyed the farm by warranty deed to the Hartogs and Harriett Siegler subject to the deed of trust. Hartog and Mrs. Siegler agreed to assume payment of the note and to cover Haroco’s acquisition expenses as consideration for the property. There was no written closing statement, nor did any money change hands. Haroco, however, subsequently paid the periodic interest on the note and paid it off in 1969. Harriett Siegler’s estate files and estate tax return noted an indebtedness due on one-half of a deed of trust on a piece of property. The Circuit Court found that the circumstances of the conveyance and the estate records evidenced an intent by the parties to the conveyance that the property stand good for the co-tenants’ obligation to Haroco.
Harriett Siegler died testate on February 1,1968. She left all of her real and personal property in trust for the benefit of her 12 year old son, appellant Paul Siegler. The boy thereafter lived with his father, Robert Siegler, who had been divorced from Harriett Siegler several years prior to her acquisition of her interest in the 126 acre tract of land in issue. Her will named Hartog as executor and trustee. Her estate was closed in November, 1971. Hartog claims to have resigned as trustee prior to this suit, and appellants have denied that there was an effective resignation. Hartog did not render any accounting to the probate court. The trust terminated at Paul’s twenty-first birthday, sometime after initiation of this suit.
After his sister’s death and until initiating this suit Hartog continued to make improvements and repairs to the property. He spent most of his weekends working there. Out of his farm checking account he paid for telephone and electric service, gasoline and fuel oil, insurance, taxes, building materials, and excavation costs, as well as for seed and fertilizer for the tenant farmer’s use. The farming operation produced income of $11,263.15 between May, 1967, and December, 1975.
Hartog did not consult appellants with respect to any of the work being done on the property, nor did he expressly advise appellants that the property was included in the trust assets. He knew, however, that the trust’s attorney had informed Robert Siegler of the existence of the trust. Robert Siegler claims he did not remember whether the attorney listed the farm among the trust assets. Appellants were aware of the farm’s existence, however, and had visited it once in 1968. In 1974 Hartog told Robert Siegler that he had made improvements to the property and offered to purchase appellants’ interest. His offer was refused. Appellants visited the farm for the second time in 1976. By that time the property had been considerably improved.
The Circuit Court found that the Hartogs had not been reimbursed for the following expenditures: fencing and materials ($1,227.84), gasoline ($1,075.65), excavating ($476.50), taxes ($2,273.34), insurance ($1,686.00), grain and seed ($2,999.94), fertilizer and lime ($1,413.25), building supplies ($12,847.31) and half the amounts expended for fuel oil ($1,022.35), electricity ($881.65), light, heat and power ($602.93). This total credit was offset against the property’s income ($11,263.15) for a net credit of $15,-243.62.
In this court-tried case the scope of appellate review is circumscribed by Rule 73.01 and the Supreme Court’s construction of that Rule in
Murphy
v.
Carron,
Bearing in mind these restrictions on our review of their partition decree, we undertake our review of this decree by taking cognizance of the rule of law that a tenant in common’s right to contribution from his co-tenant may extend to payments made for repair and improvements, taxes and other expenses, depending upon the nature and circumstances of the particular expenditures.
Hahn
v.
Hahn,
The right to compensation for improvements made without the consent of co-tenants is not a legal right, but may be enforced in equity for payment out of partition proceeds when said improvements are made in good faith, are of a necessary and substantial nature, materially enhance the value of the property, and the circumstances show that it would be equitable to do so.
Beckham v. Eggleston,
We believe there is substantial evidence to support the trial court’s finding that the expenditures made by the plaintiffs were necessary for the maintenance and repair of the real property ordered partitioned and that said expenditures were made in good faith by the plaintiffs.
Owen W. Hartog and Harriett H. Siegler, his sister, agreed to improve this property for use as a weekend home, made plans, took out a loan to reimburse themselves for expenses thereby incurred, and actually worked on the property. Clearly Mr. Har-tog had his sister’s consent for those expenditures made prior to Mrs. Siegler’s death in 1966 for those improvements made to the property up to that time.
After Mrs. Siegler’s death Mr. Hartog proceeded to carry out the plans they’d made for the property and thereby enhanced its value. There was no evidence that these expenditures were wasteful or frivolous, nor that he should have been put on notice that Paul Siegler had any objection to the work being done on the property. Despite the fact Paul Siegler saw the property in 1968, no objection to the improvements was made until 1974. As trustee of the trust estate Mr. Hartog would have been required to make an accounting to Paul Siegler had there been a request for one.
Morrison v. Asher,
We further conclude that the record supports the trial court’s finding that Mr. Har-tog was not acting as a volunteer and that he entertained a good faith expectation of reimbursement if and when he property should be sold. He kept detailed records for the property held in co-tenancy and maintained a separate account for expenditures made on this property. The loan he and Mrs. Siegler made to reimburse themselves for expenditures made on improving the property and the opening of a separate bank account for that purpose supports this finding also, particularly, inasmuch as all income from this property was deposited in that account. These steps clearly indicate an intention to maintain the co-tenancy as a separate entity from his personal finances, as well as those of Mrs. Siegler.
With respect to appellant’s contention that the evidence is insufficient to support the trial court’s conclusion that these expenditures materially enhanced the property’s value at least to the extent of said expenditures, we believe that it has no merit.
Recovery under an equitable lien depends upon what is found to be just and equitable in each particular case. In some instances the amount to be awarded may be the cost of the improvements; in other cases it may be more equitable to allow recovery of the amount by which the property’s value was enhanced solely by reason of the improvements. Enhancement value is always the upper limit of recovery, to prevent reimbursement for wasteful expenditures.
Buschmeyer v. Eikerman,
supra, l.c. 479[7];
Sires
v.
Clark,
Furthermore, it was within the trial court’s discretion to stay its final order until after the partition sale and to employ the sale price as a factor in determining the final partition of proceeds; he was not required to make a final determination based on the trial record alone.
Lester v. Tyler,
Appellants claim that Mr. Hartog’s expenditures for taxes, insurance, gasoline, fuel oil, electricity, light, heat and power were not recoverable because he was in possession and they were made for his sole benefit is also without merit.
On partition of property held in co-tenancy, an occupying co-tenant may claim reimbursement for advances made for the benefit of the commonly held property; including repairs, taxes and insurance, and his co-tenant will be entitled to set off against such claims rents and profits for the period of his occupation. 68 C.J.S. Partition § 141; Beckham v. Eggleston, supra.
The trial court here deducted the farm’s profits from respondents’ claim for reimbursement, but correctly allowed recovery for those expenditures benefitting the co-tenancy.
When a co-tenant pays taxes due on the jointly owned property he acts for the benefit of all co-tenants by preventing a lien from attaching against the property.
Where insurance benefits all of the interests of the co-tenants, premiums therefore are likewise recoverable. Goforth v. Ellis, supra.
As trustee for Paul Siegler, Mr. Hartog was under a duty to protect his nephew’s interest in the property,
Estate of Luyties v. Scudder,
The same reasoning supports the finding of the trial court that expenditures for gasoline, fuel oil, electricity, light, heat and power benefitted the co-tenants, i. e. that they were necessarily incurred in the repair and improvement of the jointly owned property.
We find no error.
Appellants’ next claim of error is that the trial court erred in reimbursing the respondents for expenditures made prior to Mrs. Siegler’s death and during the probate of her estate. The basis for this claim is that such expenditures constitute a claim against Mrs. Siegler’s estate and are barred by § 473.360 RSMo 1978, because not filed within six months of publication of letters testamentary in said estate.
Partition is a proceeding in rem and not in personam;
State ex rel. State Park Board v. Tate,
With respect to the general statute of limitations, Missouri cases have held that in an equitable partition the statute does not bar a claim for improvements.
Henry v. Steward,
supra, l.c. 530[5];
Adams v. Adams,
Section 473.360(1) of the Missouri Probate Code as revised in 1955, and in effect at the time this cause was tried, barred .“All claims against the estate of a deceased person ... whether due or to become due, absolute or contingent, liquidated or unliq-uidated, founded in contract or otherwise, which are not filed ... within nine months after the first published notice of letters testamentary ...” Section 473.360(4) exempts from this non-claim limitation period “Any action or proceeding to enforce any mortgage, pledge or other lien upon property of the estate; except that attachment, judgment and execution liens shall be enforced as provided in this law and not otherwise.”
The plain language of the statute implies that an equitable lien is an “other lien” and exempt from the statute. Prior interpretation of § 473.360(1) also indicates that the statute-does not include the lien in this case. Section 472.010(3) provides that “claims” includes liabilities of the decedent which survive, whether they arise in contract or tort or otherwise. “Liability,” in probate matters, usually refers to a debt or a pecuniary obligation.
Strumberg v. Mercantile Trust Co.,
Appellants’ argument that to exempt equitable liens from the statute will frustrate the orderly administration of estates because since the executor has no notice of an equitable lien and therefore is unable to reserve assets to satisfy the equitable lien is without merit. There is no need to reserve any assets of the estate to satisfy a co-tenant’s lien for improvements. The only asset here is the real estate held in co-tenancy and which passed directly to Paul Siegler upon his mother’s death, subject to respondent’s claim.
In re Jackson’s Will,
We hold that § 473.360 RSMo 1978 did not outlaw respondent’s claim for reimbursement for expenditures made by Mr. Hartog.
Appellant complains that the trial court erred in adjudging an equitable lien in the amount of $15,128.00 from the proceeds of the sale of the property. We hold the trial court did not err.
Owen Hartog and Harriett Siegler agreed to assume the deed of trust and to pay Haroco’s acquisition expenses in consideration for the property. The trial court found that the conveyance and the dealings between the parties and Mrs. Siegler’s estate files and the estate tax return evidenced an intent of the parties that the property stand good for the debt owed Har-oco.
To give rise to an equitable lien there must be a debt, a duty or an obligation owing by one person to another; a res to which the obligation attaches, which can be identified or described with reasonable certainty; and an intent, express or implied, that the property serve as security for the debt or obligation.
Wilkinson v. Tarwater,
Under the circumstances in evidence, the close relationship between the vendor and the vendees, and the conduct of the parties subsequent to Haroco’s payment of the note, it was not error for the trial court to conclude that the land was intended as security for the debt owed by Owen Hartog and Harriet Siegler.
The conveyance was prompted by tax considerations; no money changed hands. Owen Hartog and Harriett Siegler orally agreed to assume the note and then became personally liable on the agreement to Haroco.
Missouri Home Savings & Loan Ass’n v. Allen,
The actions of the parties support this view of the agreement. They treated the continuing indebtedness as a bookkeeping necessity rather than as a breach of contract. They were not adverse to one another, and it was not, under the circumstances, unreasonable for these parties to leave the indebtedness as a continuing entry on their books. With the close identity and good faith existing between the parties, it would be inequitable not to permit Haroco ánd Owen Hartog to adjust their dealings with respect to the property.
An equitable vendor’s lien is the creation of a court of equity, arising from an executed conveyance of land without payment of the purchase price, and based upon the principle that it is wrong for a person to retain lands of another without paying the purchase price.
Appellant also raises § 516.120 RSMo 1978 — the five year statute of limitations — as a bar to Haroco’s claim. However, this statute was not pleaded and therefore is not properly before us. Rule 55.08 requires that to interpose the defense of outlawry the particular statute must be alleged with specificity, and the failure of appellant to plead the special statute of limitations upon which he relies deprives him of that defense.
Modine Mfg. Co. v. Corlack,
We rule this claim against appellant.
Appellant’s final claim is that the trial court erred in awarding attorney’s fees of $4,860.00 to respondents’ counsel. We rule this point against appellant.
The determination of a reasonable attorney's fee in a suit for partition is a matter within the sound discretion of the trial court,
Billinger v. Jost,
Judgment affirmed.