BETTY W. TRUVER v. ESTHER W. KENNEDY, ET AL.
Supreme Court of Pennsylvania
April 18, 1967
Reargument refused May 29, 1967
425 Pa. 294 | 229 A.2d 468
In thе case at bar, upon the entry of the first judgment, even though such entry was not in accord with the provisions of the warrant of attorney, the warrant of attorney ceased to have vitality upon which to enter the second judgment and the court below should have stricken off the judgment.
The court below, while acknowledging the general rule, relying on Seltzer v. Delfiner, 17 Pa. D. & C. 2d 185 (1958) sought to distinguish between a complete and an imperfect exercise of a warrant of attorney and held that the instant warrant of attorney had been imperfectly exercised when the first judgment was entered and had not been exhausted. In our opinion, Seltzer is neither apposite nor controlling. The distinction adopted by the court below would erode the general rule and would create an exception which would emasculate a rule which has proven salutary. The sense of the rule is that parties are required to live up to that upon which they have agreed.
Order reversed and judgment directed to be stricken from the record.
Truver, Appellant, v. Kennedy.
Harry E. Smith, for appellee.
OPINION BY MR. JUSTICE JONES, April 18, 1967:
On February 2, 1928, Lizzie M. Wilson died, intestate, survived by her husbаnd, three sons and two daughters. Upon her death, title to a property,-consisting of 192 acres of land and situated in Roaring Brook Township, Lackawanna County, became vested by operation of law in her husband and five children, the former receiving a one-third interest and the latter each a two-fifteenths interest. In 1940, the husband‘s one-third interest in the property was conveyed to Esther W. Kennedy, one of the two Wilson daughters, who thus became the owner of a seven-fifteenths interest in the property.
In the meantime, taxes on this property not having bеen paid since 1930, the property was sold at a tax sale to Lackawanna County (County); nevertheless, the five Wilson children retained a right of redemption of the property. By deed recorded on April 18, 1941, the three Wilson sons and one Wilson daughter, Betty W. Truver, conveyed their respective interests in the property to Esther Kennedy. Thereafter, Mrs. Kennedy exercised the right of redemption and, by the payment of $900 in settlement of delinquent taxes owing on the property for the years 1930-1944, inclusive, she
On December 13, 1955, Mrs. Kennedy, without consideration, conveyed the remaining portion of the property to her daughter, Charlotte Kennedy, and herself and, on March 29, 1957, the same property was conveyed, without consideration, to Charlotte Kennedy. Although since 1957 several portions of the property have been sold, a considerable portion of the property is still owned by Charlottе Kennedy.
On December 30, 1963, Betty W. Truver instituted an equity action in the Court of Common Pleas of Lackawanna County against Charlotte Kennedy seeking: (a) to restrain her from conveying or encumbering that portion of the property which remains unsold; (b) an accounting of all income which has been realized from the property and all moneys received from the sales of the several portions of the property since she acquired title; (c) a court direction that, after such accounting, she pay over to Mrs. Truver such amount of money as may be found to be due to her. While the equity complaint does not specifically so state, Mrs. Truver seeks to have a trust imposed upon the property to the extent of her claimed two-fifteenths interest therein. Upon issue joined between the parties, the matter was tried before Judge CONABOY; after hearing, the court found that the evidence did not establish any trust, either express or by operation of law, and dismissed the complaint. That decree is the subject of the instant appeal.
Mrs. Truver claims that in April of 1941, after having received several letters from Mrs. Kennedy, she executed a quitclaim deed to Mrs. Kennedy of her interest in the property; that the execution of this deed was upon the express understanding that Mrs. Ken-
The real crux of this litigation lies in the construction to be placed on certain letters of Mrs. Kennedy and her counsel, -the authenticity of which letters has been established by the findings of the chancellor, -which immediately preceded the execution of the quitclaim deed and, undoubtedly, motivated Mrs. Truver in the execution оf the deed.
On March 29, 1941, Mrs. Kennedy wrote to Mrs. Truver, -who was then living in Texas, -stating that the property had been taken over by the County, that, if “one of us” did not do something, the chance to save the property would be gone, that she and her husband had ascertained that a building and loan association would “advance the money for taxes if one of us has it [the property] in our name,” that her father had already executed a deed to her and that the three brothers were willing to do so and she then requested that Mrs. Truver execute a deed convеying her interest in the property. In that letter, Mrs. Kennedy added: “... Then I can borrow the money ... and hold the place for a better sale. If at any time you want to pay your share of the taxes [giving the amount of taxes due] you can do so and get anything out of it there is to get. I am taking the responsibility of paying back the loan company so you certainly won‘t be out anything and otherwise the place will be lost anyway.”
Shortly after the receipt of these three letters, Mrs. Truver executed the deed conveying to Mrs. Kennedy her two-fifteenths interest in the property.
As we scrutinize this record certain conclusiоns are inescapable: (a) the Wilson property, sold to the County at a tax sale, was in danger of being irretrievably lost if it was not redeemed shortly by some or all of the Wilson heirs; (b) to preserve the property, at least for the purpose of selling the property for a price approximating its real value, Mrs. Kennedy was willing to borrow money to effectuate such redemption; (c) the lending agency, as a prerequisite to making a loan, required that the property be conveyed to Mrs. Kennedy; (d) Mrs. Kennedy‘s father and brothers did сonvey their respective interests to her; (e) Mrs. Tru-
From 1928 (when Mrs. Wilson died) until April, 1941, the Wilson children, including Mrs. Kennedy and Mrs. Truver, were tenants in common of this property. Even though the property had been sold at a tax sale
Unquestionably, without Mrs. Truver‘s quitclaim deed, had Mrs. Kennedy redeemed this property, to the extent of Mrs. Truver‘s two-fifteenths interest in this property she would have been considered a trustee for Mrs. Truver. Therefore, Charlotte Kennedy, who now stands in Mrs. Kennedy‘s shoes since she paid no consideration for the conveyance of thе property, must
In our view, this record reveals unequivocally that the sole reason for Mrs. Truver‘s execution of this deed was her reliance upon the promises, made by Mrs. Kennedy and her counsel, that her two-fifteenths interest in this property would be preserved for her. Unlike the court below, we find no ambiguity or uncertainty in the representations made to Mrs. Truver nor any lack of clarity in Mrs. Kennedy‘s promised undertakings.
Were it not for the parol evidence rule (Restatement 2d, Trusts, §38 (1) (pp. 102, 103)), we would have no hesitancy in finding an express trust had been created. The statements made by way of representation to Mrs. Truver, at the time of execution of the deed, satisfied the essentials to the creation of a trust. See: Helfenstein‘s Estate, 77 Pa. 328 (1875); Smith‘s Estate, 144 Pa. 428, 22 A. 916 (1891); Thompson Will, 416 Pa. 249, 206 A. 2d 21 (1965). Moreover, the letters satisfied the requirement of §4 of the Statute of Frauds2 that the declarаtion or creation of a trust “be manifested by writing.”
However, the parol evidence rule precludes the declaration of an express trust. Mrs. Truver‘s deed, absolute on its face, “release[s] and quitclaim[s]” her interest to Mrs. Kennedy, her heirs and assigns for a $1.00 consideration and no ambiguity arises from the deed‘s language. The written instrument, declares “that [Mrs. Kennedy] is to take the property for [her] own benefit.” In the absence of any averment of
Next we consider whether an implied trust, either resulting or constructive, can be imposed. Section 4 of the Statute of Frauds, supra, contains the following proviso: “Provided, That where any conveyance shall be made of any lands or tenements by which a trust or confidence shall or may arise or result by implication or construction of law, or be transferred or extinguished by act or operation of law, then and in every such case such trust or confidence shall be of the like force and effect as if this act had not been passed.” Section 44 of the Restatement 2d, Trusts, states, inter alia: “Effect of Failure of Oral Trust for Settlor. (1) Where the owner of an interest in land transfers it inter vivos to another in trust for the transferor, but no memorandum properly evidencing the intention to create a trust is signed, as required by the Statute of Frauds, and the transferee refuses to perform the trust,
The critical issue is whether, in the factual posture herein presented, a constructive trust should be raised.3 “‘... a constructive trust arises where a person holding title to property is subject to an equitable duty to convey it to another on the ground that he would be unjustly enriched if he were permitted to rеtain it.‘“: Gray v. Leibert, 357 Pa. 130, 135, 53 A. 2d 132 (1947). As Judge (later Justice) CARDOZO, speaking of the purpose of a constructive trust, said, in Beatty v. Guggenheim Exploration Co., 225 N.Y. 380, 386-89, 122 N.E. 378, 380, 381 (1919): “A constructive trust is the formula through which the conscience of equity finds expression. When property has been acquired in such circumstances that the holder of the legal title may not in good conscience retain the beneficial interest equity converts him into a trustee.... A court of equity in decreeing a constructive trust is bound by no unyielding formula. The equity of the transaction must shape the measure of relief.”
The existence of a confidential relationshiр may be found either as a matter of law or as a matter of fact. In Ringer v. Finfrock, 340 Pa. 458, 461, 462, 17 A. 2d 348 (1941), this Court said: “[s]uch a relation [confidential relation] is not restricted to any particular
That Mrs. Kennedy and Mrs. Truver were in a confidential relationship is evident; a tenant in common stands in a confidential relationship to another tenant in common with respect to the common property: Lund v. Heinrich, 410 Pa. 341, 344, 345, 189 A. 2d 581 (1963). While this Court has never adopted in toto comment c, §44, Restatement 2d, Trusts and while we have held that the existence of a clоse family relationship per se does not justify recognition of a confidential relationship5 (Brunier v. Stanert, 369 Pa. 178, 185, 85 A. 2d 130 (1952); Stewart v. Hooks, 372 Pa. 542, 546, 547,
Whether we consider the relationship between Mrs. Kennedy and Mrs. Truver as a fiduciary relationship or as a confidential relationship, we deem that the proof in the case at bar in support of a constructive trust meets the qualitative proof standard of clarity, precision and conviction. See: Jourdan v. Andrews, 258 Pa. 347, 102 A. 33 (1917); Sechler v. Sechler, 403 Pa. 1, 7, 169 A. 2d 78 (1961). We are of the opinion that the evidence clearly indicates that Mrs. Kennedy and Mrs. Truver “assumed a relation of confidence to which equity will give effect....” Lalich v. Bankovsky, 350 Pa. 441, 446, 39 A. 2d 514 (1944).
Not determined by the court below, although raised, is the question whether the instant action is barred either by a statute of limitations or laches. The transfer of Mrs. Truver‘s interest in this property took place in 1941 and this action was not instituted until December 1963, approximately 22 1/2 years after such transfer. Conveyances of two portions of the property were made and duly recorded in 1951. The remaining portion of the property was conveyed first from Mrs. Kennedy to her daughter and herself in 1955 and later to the daughter alone in 1957. From 1957 to the date of this action, Charlotte Kennedy has made several other conveyances of portions of this property. Mrs. Kennedy, the transferee, died lоng before the institution of suit.
Mrs. Truver, a Texas resident, claims she did not know of the transfer of the property to Charlotte Kennedy until 1961, four years subsequent to such trans-
The
Under the position taken by Mrs. Truver, her cause of action accrued in 1957 and the five year period of limitation under §6 of the
Where a cestui que trust seeks to enforce his alleged rights against a trustee, either actual or by operation of law, the burden is upon the trustee, who relies on laches, to show that an inordinate length of time has elapsed since the cause of action arose and that, due to changes which have accrued during such lapse of time, the trustee has been prejudiced: Mulholland v. Pittsburgh National Bank, 418 Pa. 96, 209 A. 2d 857 (1965); Barnes & Tucker Co. v. Bird Coal Co., 334 Pa. 324, 5 A. 2d 146 (1939).
Laches applies to both express trusts and trusts created by operation of law, whether resulting or constructive: Trusts and Trustees, Bogert, (2d Ed.), §951 et seq., p. 467 et seq.; Scott on Trusts (2d Ed.), Vol. II, §219 et seq., p. 1609 et seq. For reasons previously given, we have concluded that, under the instant circumstances, a constructive trust arose and we further conclude that Mrs. Truver‘s action is barred by laches.
In determining the question of laches we are mindful that Mrs. Truver has lived many years in Texas, that she only visited Lackawanna County three or four times during the entire period and that her opportunity to know the status of the property involved was some-
However, the instant record reveals a lack of diligence on the part of Mrs. Truver. Between 1951 and 1961, on at least six occasions, portions or all of this property were conveyed and such conveyances were recorded.6 During this period of time Mrs. Truver made no inquiries whatsoever concerning the status of this property; so far as the record reveals, she made no inquiry whether the taxes were being paid and, if so, by whom, whether the mortgage which Mrs. Truver knew had been placed upon the prоperty by the Kennedys was being paid and, if so, by whom, whether the property was being kept in repair and properly maintained, etc. On the contrary, the record reveals an absence of even minimal curiosity on Mrs. Truver‘s part as to the status of this property as well as a willingness on her part, through inaction, to let others assume the burdens associated with the care of the property of which she now seeks the benefit. Mrs. Kennedy, the constructive trustee, and her counsel are both now deceased, 22 years has elapsed since the events which led to the creation of the constructive trust took place and that prejudice has resulted is obvious.
The record evidence establishes the existence of a constructive trust but the lack of due diligence on the part of Mrs. Truver bars her from the maintenance of this action.
Decree affirmed. Each party to pay own costs.
DISSENTING OPINION BY MR. JUSTICE ROBERTS:
I disagree with the conclusion of the majority that Mrs. Truver is barred from obtaining the relief she seeks either because of the statute of limitations or the doctrine of laches.
The majority opinion while not suggesting that Mrs. Truver had knowledge of Mrs. Kennedy‘s conveyances, imposes a duty upon her to have made frequent inquiries about the status of the realty, to have displayed “curiosity“. In my view appellant was under no such duty. Mrs. Truver, a resident of Texas, had every right to assume that her sister-trustee would continue to preserve, hold and account for her interest in the property. It was not until she noticed the construction in 1961 that she first had cause to be suspiсious and thereafter she immediately demonstrated her concern. Nor do I see how Charlotte Kennedy was unduly prejudiced by the death of her mother, some two months prior to the institution of this suit, and the death of her mother‘s lawyer. The majority is willing to conclude that the record evidence clearly establishes the existence of a constructive trust, and Charlotte Kennedy as donee stands in the shoes of her mother.
I am in substantial accord with the view taken by Mr. Justice JONES on the remaining issues of this case. Accordingly I dissent from the Court‘s judgment.
Mr. Justice MUSMANNO and Mr. Justicе O‘BRIEN join in this dissenting opinion.