RISSBERGER, Respondent, v. GORTON, Appellant.
No. 77-1256, CA 11488
Court of Appeals of Oregon
Argued March 26, affirmed as modified July 2, 1979
reconsideration denied August 14, petition for review denied September 5, 1979
597 P2d 366
RISSBERGER, Respondent, v. GORTON, Appellant.
(No. 77-1256, CA 11488)
597 P2d 366
John A. Hudson, Eugene, argued the cause for appellant. With him on the brief was Curtis, Hendershott, Strickland & Hudson, Eugene.
Before Schwab, Chief Judge, and Lee, Buttler and Joseph, Judges.
JOSEPH, J.
Plaintiff brought this suit for a declaration that she and defendant are joint and equal owners of certain real and personal property acquired while they were living together. The trial court entered a decree for plaintiff. Defendant appeals. Both parties concede that the matter as pleaded is equitable.1
The parties first moved in together in the summer of 1969, when defendant was 21 and plaintiff 18. They lived together again the following summer; but each fall whеn they returned to college, they lived in separate apartments. In 1971 they cohabited throughout the summer and until November, when they separated and began dating other people. In February or March, 1972, they resumed cohabitation and lived together until February, 1977.
During the period of separation in 1971-72, defendant looked for a duplex to buy. Around the time he and plaintiff reconciled, he found one. She testified that he gave her a copy оf the listing on the property and talked with her about it. He denied that. On March 29, after they had begun living together again, he signed an earnest money agreement on the property in his own name. The duplex was purchased on a contract, in which he was named as the buyer. Plaintiff was not involved in the closing. The title, which was placed in escrow, was in defendant‘s name alone. Plaintiff claimed she did not realize until after the closing that
The parties moved into one-half of the duplex, where they lived until the end of their relationship. The other half was rented. During that period, both parties worked off and on; he was unemployed or disabled at various times and she missed substantial periods of work for medical reasons and to have a baby. (The child was born in 1973; defendant admitted paternity and agreed to help support the child.) During the cohabitation, defendant‘s total income seems to have been approximately twice that of plaintiff.2 They maintained joint checking and savings accounts, from which “household” expenses were paid. It is not clear how much of their respective incomes the parties put in the joint accounts. There was evidence that for a time he maintained a separate account for property taxes, and she kept a separate “travel” account. The monthly payments on the duplex, with the exception of the first two, were paid from the joint checking account, and the rental payments made by the occupants of the other half of the duplex were also deposited in that account.
During their cohabitation, the рarties also accumulated personal property, including automobiles and a motorcycle, furniture, appliances, tools, a handgun and other items. Defendant‘s name only was on the title to the automobiles. The circumstances under which most items of non-household personal property
At various times during the 1972-77 period of cohabitation, plaintiff testified, she requested that defendant put her name on various titles, including the title to the duplex. He always refused. She also asked him several times to marry her, but he would not. He testified that he wished to avoid “the kinds of problems that would be incurred in a divorce suit if I married her.” Nevertheless, she was hospitalized as Nancy Gorton on one occasion and the expenses were paid by his health insurer. She claimed that he told her that in case he died, all his property would go to her and the child.
In 1975, defendant mortgaged the duplex. He paid off the purchase contract and received approximately $8,000 net, of which he invested $4,000 in a business partnership. The remaining $4,000 was apparently applied on the mortgage or taxes on the duplex. In February, 1977, the parties separated. Defendant remained in the duplex—which at the time of trial was valued at about $50,000—and retained most of the
The trial court found that
“[p]laintiff has an interest in the [duplex] and the personal property acquired by the parties during the period of the living together from February, 1972 to February, 1977. This interest arises out of an implied agreement of partnership.”
The court ordered the duplex sold and the proceeds distributed as follows: (1) $2,962, the amount of the down payment, to defendant together with interest from the date the property was purchased; (2) one-half the amount defendant borrowed on the property to plaintiff, with interest from the date of the refinancing; (3) $3,000 to plaintiff‘s parents, plus interest, from the date they paid the judgment taken against them as co-signers on the loan for the automobile originally purchased by plaintiff and later, according to plaintiff, signed over to defendant; and (4) thе remaining proceeds in equal shares to plaintiff and defendant. The court ordered $3,750 deducted from defendant‘s share of the proceeds and paid to plaintiff in lieu of distribution of her share of the personal property. Defendant requested such a cash settlement provision, and plaintiff did not object.
We review de novo. We note, however, that nothing in the record discloses the plaintiff‘s theory beyond the assertion of unjust enrichment.4 The case was decided on the basis of an implied partnership agreement, and that is the only theory urged by plaintiff in this court.
Some courts faced with the problem of dividing the assets acquired by parties during unmarried cohabitation have found an implied partnership agreement. In re Estate of Thornton, 81 Wash 2d 72, 499 P2d 864 (1972); see Folberg and Buren, Domestic Partnership: A Proposal for Dividing the Property of Unmarried
“We believe a division of property accumulated during a period of cohabitation must be begun by inquiring into the intent of the parties, and if an intent can be found, it should control that property distribution. While this is obviously true when the parties have executed a written agreement, it is just as true if there is nо written agreement. The difference is often only the sophistication of the parties. Thus, absent an express agreement, courts should closely examine the facts in evidence to determine what the parties implicitly agreed upon.
* * * * *
“More often than not, such an inquiry will produce convincing evidence of an intended division of property, but we recognize that occasionally the record will leave doubt as to the intent of the parties. In such cases, inferences can be drawn from factual settings in which the parties lived. Cohabitation itself can be relevant evidence of an agreement to share incomes during continued cohabitation. Additionally, joint acts of a financial nature can give rise to an inference that the parties intended to share equally. Such acts might include a joint checking account, a joint savings account, or joint purchases.” 282 Or at 122.
We conclude the record supports a finding of an implied intent to share equally in the household items, but does not support a finding of a mutual intent to share any interest in the duplex, the automobiles and motorcycle, or any other non-household item for which defendant paid with his own separate funds. There is no evidence of any expression by either party of an intention with respect to their relative interests in the household goods. The use of joint checking and savings accounts to purchase household items, the cohabitation itself and the conception and birth of the child, however, are persuasive evidence of an intent to share
On the other hand there were clear and repeated declarations, albeit by defendant unilaterally, but acknowledged by plaintiff on trial, of an intention with respect to the duplex and other personal property. He asserted throughout the relationship that he considered himself sole owner of those items. Plaintiff‘s repeated requests to be included in the title to various items were always refused, as were her suggestions of marriаge. Defendant may have told plaintiff she would have an interest in case of his death, but there was no evidence that he led her to believe she had any interest in those items during his lifetime. Despite the joint accounts, the cohabitation and the child, the record does not support a finding of any agreement, i.e., a mutual intention, to share the other property.
Defendant argues that the trial court erred in awarding some of the proceeds of the sale of the duplex to plaintiff‘s pаrents, who were not parties to this proceeding, because of their having paid off the loan on a car. We agree that no award could properly be made to the parents.5
The decree is therefore to be modified. The declaration that plaintiff has an interest in the duplex and the personal property, other than household goods, is eliminated. The order to sell the property and to distribute proceeds to plaintiff and her parents is also eliminated. It is decreed that plaintiff has a one-half interest in the household goods and furnishings. The value of that interest, based on plaintiff‘s estimates (which are the only available evidence), is $2,138. Because defendant has so requested and plaintiff has no objection, he may retain all the household furnish-
Affirmed as modified.
BUTTLER, J., concurring in part, dissenting in part.
I agree with the majоrity that the record does not support an express agreement of the parties with respect to their relative interests in any of the property acquired during their final five year period of cohabitation. I also agree with the majority that the record supports a finding of an implied intent to share equally in the household items. In this connection, the majority states:
“* * * The use of joint checking and savings accounts to purchase hоusehold items, the cohabitation itself and the conception and birth of the child, however, are persuasive evidence of an intent to share equally in household items, whether purchased from a joint account or given to the parties while cohabiting. Beal v. Beal, supra. There was no evidence that defendant had a contrary intent until the parties separated.” 41 Or App at 71-72.
I disagree, however, with the conclusion that plaintiff has no interest in the duplex, which was the parties’ home, as well as an investment. Therefore, I dissent.
The trial court found in favor of plaintiff, although there were substantial discrepancies between her testimony and that of defendant. We should defer to the trial judge‘s advantage in evaluating conflicting testimony, McCoy and McCoy, 28 Or App 919, 562 P2d 207, 29 Or App 287, 563 P2d 738 (1977), but whether we do or not, my reading of the record leads to the same evaluation of it.
On that basis, it appears that prior to the partiеs’ recohabitation in February, 1972, they had considered
Defendant said he began looking for a duplex before he and plaintiff reunited, and had negotiated an earnest money agreement prior to that time. Plaintiff said defendant had found one he thought was interesting, gave her a copy of the listing, and they both looked at it. The earnest money agreement was signed March 29, 1972, by defendant as buyer, “a single man,” and he paid the initial down payment out of funds he received as disability compensation for an on-the-job injury. Plaintiff did not know until after closing that the real estate contract would be in defendant‘s nаme alone.
The parties made their home in the second floor portion of the duplex and rented the other half. They opened joint bank accounts—both checking and savings—and both put most, if not all, of their earnings, and the rental income in those accounts. Most of their bills, including payments on the duplex contract, were paid from the joint checking account until the property was refinanced in June of 1976. (More about that bеlow.) While the contract payments varied (because the escrow fees changed from time to time), they were approximately $250 per month. Defendant would have us believe that the amount over and above the rental payments received and deposited in the checking account was insignificant—approximately $20 per month. However, the duplex was rented originally for $137.50 per month, then increased to $150 per month and later to $180 per month. It appears, therefore, that at least $70 per month more than the rental payments was necessary to make the contract payments—and all of it came from the joint account until the refinancing.
With respect to the rented portion of the duplex, plaintiff helped to maintain it by cleaning it and shampooing the rugs between tenants, helped to repaint it, showed the unit to prospective new tenants, issue receipts for rent, etc.
The foregoing facts, in addition to those relied on by the majority to show an implied intent to share equally in the household items, are sufficient, though barely, to support the conclusion that there was an implied partnership with respect to the duplex, which had a business purpose (see
Here, the parties pooled their earnings in joint bank accounts and paid their bills, generally, from the joint checking account. Most, if not all, of plaintiff‘s earnings were spent on their joint expenses, and some of them went into the duplex. While legal title to everything to which a document of title was applicable was in defendant, in the context of the parties’ arrangement that fact does not seem to have much real significance. He refused her request to put title in both of their names because he thought it might complicate things and because he said she and the child would get it if he died. How plaintiff would get any part of it, absent a will so providing, is not explained unless she had an intеrest by virtue of their arrangement. His intention, then, with respect to plaintiff‘s having an “interest” in the property, as opposed to his bare legal title, was ambivalent. One half of the duplex was their home, and she did all of the housework, laundry and cooking, even when she was working. The rental from the other half went into a joint account to which she had as much legal right as he—and in fact wrote most of the checks. The monthly contract payments werе made from that account, at least until the refinancing in June, 1976. Thereafter, mortgage payments and taxes were made from an account established with funds derived from the mortgage loan on the property—in other words, the property itself was funding those payments.
While it is true that he earned more than she during the last five years of their relationship, the discrepancy is nowhere near as great as he contends. As best I can determine from the testimony, most of their earnings were deposited in one or the other of the joint accounts. No effort was made to keep segregated accounts of anything.
Accordingly, I would affirm the decree as it relates to the disposition of the duplex, except that I agree with the majority that it must be modified to eliminate the requirement that defendant pay $3,000 to plaintiff‘s parents, whose rights are not involved in this proceeding. In all other respects I would affirm.
Thornton, Lee and Roberts, JJ., join in this dissent.