Garcia v. Marquez

684 P.2d 513, 101 N.M. 427
CourtNew Mexico Supreme Court
DecidedJuly 23, 1984
Docket15140
StatusPublished
Cited by11 cases

This text of 684 P.2d 513 (Garcia v. Marquez) is published on Counsel Stack Legal Research, covering New Mexico Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Garcia v. Marquez, 684 P.2d 513, 101 N.M. 427 (N.M. 1984).

Opinion

OPINION

SOSA, Senior Justice.

Plaintiff Caesar Garcia brought an action to impose a trust on land he had previously conveyed to his daughter Dolores Marquez. Defendant Marquez appeals from the district court’s imposition of a constructive trust claiming: 1) the evidence was insufficient to justify imposition of a constructive trust; 2) plaintiff’s complaint was barred by the statute of limitations or the doctrine of laches; 3) the clean hands doctrine should apply to preclude imposition of the trust; and 4) plaintiff Garcia waived any claims he may have had to the property.

The property in question consisted of two contiguous lots in Ruidoso purchased by plaintiff and his former spouse in 1940 and included the family residence. In July 1974 plaintiff and his spouse deeded the property to defendant. Plaintiff, his spouse and defendant continued to reside in the family home until July 1979 when the parents were divorced.

In May 1980 plaintiff filed an action to establish a constructive trust over his interest in the property. Plaintiff’s former spouse was never made a party to this action. After trial on the merits the district court concluded that defendant’s title be encumbered with a constructive trust for herself and her brothers and sisters to the extent of plaintiff’s one-half interest in the property. The court further concluded that defendant be reimbursed for $2,250 of her costs and attorney’s fees incurred in preserving the property. Defendant was accordingly ordered to convey plaintiff’s interest to herself and her brothers and sisters as tenants in common.

Substantial Evidence

Defendant initially asserts there is no substantial evidence of fraud, duress, overreaching or similar unconscionable conduct on her part in connection with the transfer of the property as would be required for the imposition of a constructive trust. Such conduct, however, is not essential for the imposition of a constructive trust. See Velasquez v. Mascarenas, 71 N.M. 133, 140-141, 376 P.2d 311, 316 (1962).

Other grounds commonly supporting the imposition of constructive trusts are abuse of a confidential relation and unjust enrichment. Flanagan v. Benvie, 58 N.M. 525, 273 P.2d 381 (1954); Restatement (Second) of Trusts §§ 2 comment b, 44, 45 (1959); G. Bogert, The Law of Trusts and Trustees §§ 482, 496 (1978). We review the record then for evidence which would properly support the trial court’s imposition of a constructive trust.

The general rule applicable to substantial evidence questions is that all evidence is viewed in a light most favorable to the findings and conclusions of the trial court and this Court will not reverse unless convinced that the judgment and the findings and conclusions upon which it is based cannot be sustained either by the evidence or by permissible inferences therefrom. Lujan v. Pendaries Properties, Inc., 96 N.M. 771, 635 P.2d 580 (1981). The rule applies equally to cases where proof must be determined by clear and convincing evidence, Duke City Lumber Co. v. Terrel, 88 N.M. 299, 540 P.2d 229 (1975), as is required for the establishment of constructive trusts. White v. Mayo, 35 N.M. 430, 299 P. 1068 (1931); G. Bogert, supra, at § 472; see Giovannini v. Turrietta, 76 N.M. 344, 348-349, 414 P.2d 855, 858 (1966).

In the instant case, the evidence was conflicting regarding the circumstances surrounding the transfer. Plaintiff Garcia testified that the property was transferred after he had been involved in an auto accident and became worried over the possibility of losing the family house in subsequent litigation. He indicated he and his former spouse transferred the property to defendant because she was their only remaining unmarried child still living at home and because his former spouse expressed a strong desire that the property be placed in defendant’s name.

At trial, plaintiff indicated that defendant had agreed to transfer ownership to all of the children in the family once the property was no longer used as the family home. This information was transmitted throughout the family by a series of individual conversations among various family members. Plaintiff and some of his children testified the property was to benefit all children in the family equally. Defendant, on the other hand, testified that she was not aware of such an obligation or any other limitation to her exclusive ownership of the property.

The evidence was also conflicting regarding exercise of dominion and control over the property after the 1974 transfer. Between the time of transfer and the date of the divorce, plaintiff’s funds were for the most part used for improvements to the home and to pay property taxes, utilities and insurance. The improvements included the addition of a two-story structure on the property. Some members of the family contributed to what they viewed as their parent’s efforts at these home improvement projects. Although defendant paid for some minor improvements of her own, she did not reimburse her father or members of the family for improvements they had made. Finally, while some of defendant’s siblings were generally aware of the deed to defendant, they thought their parents still owned the property and sought their permission, and not that of defendant, to live in the home temporarily or to store items on the premises.

From the evidence it is clear a parent-child relationship existed with surrounding circumstances indicating the presence of a relationship of trust and confidence between the parties. There was clear and convincing evidence outlining the terms of defendant’s ownership and the conditions upon which it was to be transferred to her siblings. Viewing the evidence in a light most favorable to the trial court’s findings and conclusions, Lujan v. Pendaries Properties, Inc.; Duke City Lumber Co. v. Terrel, and in keeping with the tendency of courts to liberally construe confidential relationships, see Restatement (Second) of Trusts, supra, at § 44 comment a; G. Bogert, supra, at § 496, we conclude there was sufficient basis for the imposition of a constructive trust over plaintiff’s one-half interest in the real property.

Claim Bar

Defendant also claims that plaintiff’s action was barred either by the statute of limitations or laches. As to the statute of limitations, she asserts that the four-year period set forth at NMSA 1978, Section 37-1-4 for constructive trusts began to run on the date of the original July 1974 conveyance and thus barred plaintiff’s May 1981 lawsuit. She further argues there is no evidence of fraudulent concealment on her part which would have tolled the limitations period.

Defendant’s argument is misplaced. The proper rule of law to be applied here is that a limitations period does not run between a trustee and his beneficiary until there has been a repudiation of the constructive trust. Miller v. Miller, 83 N.M. 230, 490 P.2d 672

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Bluebook (online)
684 P.2d 513, 101 N.M. 427, Counsel Stack Legal Research, https://law.counselstack.com/opinion/garcia-v-marquez-nm-1984.