De Vol v. Citizens Bank

179 P. 282, 92 Or. 606, 1919 Ore. LEXIS 135

• Court: Oregon Supreme Court
• Decided: March 18, 1919
• Status: Published

Opinions

BENNETT, J.

1. The first question presented by the appeal is whether or not the court erred in permitting George De Yol and his sister, Mary De Vol, to testify that while the legal title to the property was in her name, she held it under a parol trust, and tha:t the plaintiff was really the beneficial owner. This question is presented by assignments of error 1, 2, 3, 4, 5 and 6. All of the questions presented in these assignments are fully covered by assignment 3, where Mary De Yol was asked:

“State fully why George De Yol deeded said property to you. What, if any, consideration did you pay him for doing so, and whether you owned the property or did you hold only the legal title to said property for said George De Yol?

“A. He deeded said property to me so if he should fail in business we would always be sure of having a home. I paid no consideration whatever to him for deeding the property to me, and I did not own the property after I received the deed to it. I only held the legal title to said property for my brother, who was in possession of the same. * * ” v

It is strongly urged on behalf of appellant, that this was an attempt to prove a trust by parol evidence, and was in violation of the statute of frauds, and that Mary De Yol, and not the plaintiff, must be conclusively assumed to have been the owner of the real property deeded by her and her brother, and therefore also, of the money, which was part of the purchase price.

' We do not think this contention can be sustained. It ip conceded that she joined with her brother in executing the deed to Whitmer. Both Mary De Yol and her brother testified that she did this at his request, and she testified that she had.nothing to do with the transaction except to sign the deed, and that both the property and the money arising from its sale really belonged to her brother, plaintiff herein. If this was true, the transaction between Mary De Yol and her brother, became in the nature of an executed trust. She held the property subject to his use and disposition, and, upon his order and request, she signed the deed to Whitmer in full recognition of the parol truPt. Under such circumstances, and when the trust has been so acknowledged and executed, the reason for the rule against admitting parol evidence fails, and when the reason fails the rule fails with it.

In Perry on Trusts it is said:

“And the statute of frauds, will be satisfied if the trust can be manifested or proven by any subsequent acknowledgment by the trustee, as by an expressed declaration, or any memorandum to that effect; or by letter under his hand, or by his answer in chancery, or by his affidavit”: Vol. 1 (6 ed.), § 82.

And in the work of Mr. Beach on the same subject, it is said:

“Where the purpose of the grantor to create a trust is not set forth in the instrument by which the estate is conveyed, it may be adequately declared and proved by the testimony of the trustee to whom it is conveyed, or who is the holder of the legal title. This declaration may be made at the time of the conveyance or at a later date”: Beach on Trusts, § 39.

And this is the doctrine announced by our court in Richmond v. Bloch, 36 Or. 594, 595 (60 Pac. 385, 386), in which it is said:

“The adjudicated purpose of the statute, however, is not to declare such a parol or verbal trust illegal, and therefore a nullity. But the trastee may elect to perform the conditions thereof, notwithstanding the absence of compulsory power; and the courts will, if he chooses to act upon his verbal promise, protect him in the execution of the trust, and, as far as possible, will protect the beneficiaries in the enjpyment of the fruits of its execution, and when once the trust is executed it cannot he revoked. ’ ’ '

And again building upon and quoting with approval from Sieman v. Austin, 33 Barb. (N. Y.) 9, the court says:

“The law refuses its aid to enforce agreements creating trusts or charges upon lands when they rest altogether in parol, not because the trusts are therefore void, hut because it will not permit them to he proved by such evidence. But when a person who has received the title to lands purchased for the benefit of another, although without having declared the fact in writing, recognizes and fulfills the trust, it is not the duty of the court to deny its existence. * * If he fulfills the trust by conveying the property to the true owner, there is no rule of equity which will impeach the title thus acquired.”

And again, quoting from an Indiana case, Hays v. Reger, 102 Ind. 524 (1 N. E. 386):

“This statute, as also the statute of frauds, was enacted, not that parties might avoid trusts which were executed, hut rather to enable them, in case of an attempt to enforce such trusts while they remain executory, to insist on certain modes of proof in order to establish them. The trust having been executed, we need not determine whether it was one arising by implication of law, or whether it was an express trust. Whether it was one or the other, the parties having voluntarily executed it, the authorities are that it may be proved by parol for the purpose of showing that the apparent owner had no interest which was subject to the lien of a judgment against him.”

Neither the statute of frauds nor our similar statutes, were ever intended to prohibit men’ and women from being honest; or from observing or carrying out in good faith their moral obligations, if they choose to do so. : ‘

2. If, as testified by the plaintiff and hi's sister, George De Vol was the real beneficial owner of this property, and Mary De Vol saw fit to join in the execution of this deed at his request, for the purpose of carrying out her moral obligation to dispose of the property, according to his direction, there was no reason why she should not do so, and under such conditions the purchase price would become his property, just as much as though he had previously held the legal title.

There was a motion for a nonsuit, and also a motion for a directed verdict. The order of the court denying these motions makes up appellant’s assignments 8 and 10, and in support thereof it is urged that there is no competent evidence that the contract alleged was ever made, and no competent evidence that plaintiff ever made any deposit with defendant at all, but we think there was no error in refusing these motions.

3. The evidence of the plaintiff as to what occurred at the time of the transaction is not very clear, but there can be no question that the money was actually deposited in the bank, and accepted by the bank as a deposit, and that it was to be held with some relation to these liens. It must also be assumed, that this money primarily belonged to one or the other of the De Vols, because it was a part of the purchase price of their property.

In addition to this are the letters from De Vol to the bank and to Lambert, who was it's cashier or president. The first of these letters is dated November 6, 1910, and is as follows: f

“1695 Adeline St., Oakland, Cal.

“Nov. 6th, 1910.

“Pres, of Citizens Bank, '

“Portland, East Side, Or.

“Dear Sir:

“Not knowing what the street assessment would be on Pettygrove and 17th Sts., Portland, Or., I left $1,000 in the above Bank in the fall of 1905. Will you please, let me know if the assessment has been settled or what has been done since that time, and oblige '

“George De Vol.”

The second letter was dated January 14, 1915, and is as follows:

“2339 Adeline St., Oakland, Cal.

“January 14th, 1915.

“Mr. Lambert:

“Will you please let me know what has been done about the reassessment of 17th St.? You remember 1 left $1,000, One Thousand dollars in your bank at 4% in 1905 in case the city should win the suit. I, with others, had signed over to Ralph Duniway at that time, as it is now 10 years I should think the case should be settled.

“Please let me hear from you soon.

“Very truly,

“Geo. De Vol.”

The third was written January 23, 1915, as follows:

“2339 Adeline St., Oakland, California.

“Jan. 23rd, 1915.

“Mr. Lambert.

“Dear Sir:

“I wrote you not long ago, and have not heard from you, about the $1,000 at 4% I deposited in the Citizens Bank as collateral in case the city won the suit over the re-assessment of 17th St. I want to have a settlement and hope you will let me hear immediately from you.

“Very truly,

“George De Vol.”

The fourth was dated May 16, 1915:

“2339 Adeline St., Oakland, Cal.

“May 6, 1915.

“Dear Sir:

“I left $1,000 at 4% in Citizens Bank in Fall of 1905, this amount was left in escrow of the assessment of 17th and Pettygrove St. It was then in the hands of a lawyer to he settled. A. "W. Lambert was then Pres, of the Bank and surely he remembers the transaction, as he bought the property. I wish to know if your books show that I paid that money into the Bank.

“Please let me know soon, and oblige

“George De Vol.”

It is admitted that these letters were received by the parties to whom they were addressed, and indeed they were produced at the trial by the defendant. The plaintiff testified that he received no answers to these letters, except to the one of May 6th, which was dated May 11, 1915, and is as follows:

“Portland, Oregon, May 11,1915.

“Mr. George De Vol.,

“2339 Adeline St.,

“Oakland, Cal.

“Dear Sir:

“This is in reply to your letter of May 6th regarding $1,000.00 left here in 1905. Mr. Dunniway has recently written you a letter regarding the status of this property. The $1,000.00 you mention was applied on the note held by Dr. E. G. Clark.

“Yours truly,

“Citizens Bank.

“By M. Redmond.”

4. The defendant was challenged to produce any carbon copies of answers- to the other letters which it might have, and none were produced. There was no evidence of any other answers having been written, except the evidence of Mr. Lambert that he had written one letter in long hand and kept no copy. These letters, with the answer to the one, and the fact that the others were unanswered (if the jury so found) together with the oral testimony of Mr. De Yol, were sufficient evidence to go to the jury tending to prove that the money was deposited with the Citizens Bank by George De Yol and the purpose for which it was- deposited.

5. It is well settled that in a transaction of this kind, the correspondence between the parties, in relation to the transaction, is evidence thereof, and that where one party has written to the other, stating the transaction in a certain way, and the other party has made no disclaimer, or other answer to the letter, the letter itself; with the fact that it was not answered, is some evidence, in the nature of an implied admission, as to the truth of the facts stated therein. Altogether, there was sufficient evidence to justify the submission of the issues to the jury.

6. In this connection it is urged by appellant that the cause was essentially a suit in equity'rather than an action at law, but we cannot see that this contention was well taken. The action was upon an implied contract to pay over the money in question to the plaintiff when the property should be clear of the liens in question. It was in the nature of an action for money had and received for plaintiff’s benefit. It was merely an action against an ordinary stakeholder. If the defendant had kept the money in its hands it might perhaps by a proper pleading have presented to the court the adverse claims to the money of De Yol, by Lambert and Whitmer, and have had that matter adjudicated; hut there was no attempt to present this question. In the condition of the pleadings we think it was purely an action at law and was properly tried before a jury.

7. Under assignments of error 7, 11, 18, 19, 20, 21 and 22, it is contended that the effect of the contract alleged and urged by the plaintiff is to vary the terms of the covenant of warranty in the deed. We do not think this contention can be supported. The arrangement in regard to the holding back of this money had nothing to do with the covenants of warranty but was an independent transaction. The money was kept out and deposited with reference to the particular liens, which were then in litigation. The covenant of warranty was against all encumbrances. If this money had been paid over to the plaintiff, the grantee under the deed would still have had his action for any breach of the warranty, whether that breach might result from these particular liens, or any other liens; and whatever disposition might be made of this particular fund, the warranty in the deed would be left entirely undisturbed.

It was not, therefore, an attempt to vary or change the terms of the warranty that was contended for by the plaintiff. It was a contract in regard to this particular fund, which was held out under a special arrangement to provide for the satisfaction or discharge of these particular liens.

8, 9. The defendant asked the court to instruct the jury .as follows:

“Plaintiff alleges that he deposited the money with defendant, and defendant denies the same and alleges the money was deposited by Mary De Vol.”

And again:

“If you find from a preponderance of the evidence that the money deposited in the bank was the money of Mary De Vol, then plaintiff cannot recover.”

By these instructions the defendant sought to have submitted to the jury the question of whether the arrangement as to the money deposited was made by Mary De Yol or the plaintiff, and as to which of them, the money belonged. These instructions were refused by the court, and in this we think there was error. If the money actually belonged to Mary De Yol, and the contract of the bank was to pay it to- her and not to plaintiff, of course the plaintiff must fail in this action,' as there is no claim of any assignment. The issue was directly made by the pleadings and there was evidence to sustain both contentions.

As we have seen, the evidence of George De Yol and his sister, that he was the real owner of the land and the money, and that the contract, was made with him, was entirely competent, yet it was not necessarily conclusive.

The legal title to the property was confessedly in Mary De Yol, and some inference or presumption would naturally arise that the property was hers, and that, therefore, the money also belonged to her. Whether this presumption was overcome by the testimony of George De Yol and his sister was for the jury.

Besides this, the defendant offered and introduced affirmative evidence that the contract and arrangement in regard to this money was with Mary De Yol.

The contract, or receipt for this money, offered by defendant is as follows:

“$950.00. Portland, Oregon, October 31st, 1905.

“Received of Mary De Yol the sum of nine hundred fifty dollars, to be held as security for the payment of the City Liens against lots 1 and 4 block 235 in Couch Addition to the City of Portland, Multnomah County, Oregon, pending the result of the present litigation.

“The liens are as follows:

For improvements 17th St. lot 1.....$401.7Q

For improvements 17th St. lot 4 ..... 444.03

Total without costs or interest.......$845.73

“Also, May 24th, 1905, Tanner Creek Sewer:

Lot 1 said block.................... 9.80

Lot 4 said block.................... 9.80

Total........................19.60

“The sums for improvement of 17th Street to be held by us until the said litigation is settled by court or compromised, to bear interest at 4% per annum from date until paid.

“The said $19.60 and interest and costs for said sewer to be paid by us within five days from this date.

“And we further promise to pay the surplus over and above said liens to said Mary De Yol or her order within five days after notification that said 17th Street improvement is adjudicated by the courts or ready for compromise by the parties thereto.

“Citizens Bank.

“By A. "W. Lambert, Cash.”

Lambert testified as a witness for the defendant that this contract was written out at the time of the transaction, and that one copy of it was then and there given either to Mary or George De Yol. This evidence was amply sufficient to' go to the jury as supporting defendant ’s contention in the case.

The proposition that where the contention of either party is alleged in the pleading, and sustained by evidence sufficient to go to the jury, he has a right to have that theory submitted, is too well settled to merit the citation of authorities. "We cannot find that this issue in the case was anywhere distinctly Submitted to the jury, and the defendant having asked for specific instructions in that regard, and excepted to their refusal, a new trial must be granted.

■ Another instruction in relation to this matter asked for by the defendant and refused by the court is as follows:

“And in this connection I instruct you that the money deposited in the bank, whatever the sum thereof was, is admitted to have been withheld'.as a part of the purchase price of the property sold by the De Yols to Whitmer, and I instruct you that the property so sold was Mary De Vol’s property and that said money so 'deposited was, therefore, d^Lary De Vol’s.”

For reasons already discussed there was no error in refusing this instruction.

Reversed and remanded for new trial.

Reversed and Remanded.

McBride, C. J., and Bean and Johns, JJ., concur.