Logan v. Forster

250 P.2d 730, 114 Cal. App. 2d 587, 1952 Cal. App. LEXIS 1213
CourtCalifornia Court of Appeal
DecidedDecember 5, 1952
DocketCiv. 19002
StatusPublished
Cited by58 cases

This text of 250 P.2d 730 (Logan v. Forster) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Logan v. Forster, 250 P.2d 730, 114 Cal. App. 2d 587, 1952 Cal. App. LEXIS 1213 (Cal. Ct. App. 1952).

Opinion

FOX, J.

Plaintiff filed this action against the executrices of his late wife’s estate alleging that one half of all the properties comprising the estate belonged to him as his share of the community property. The total appraised value of the *590 estate was $364,382.54. Plaintiff appeals from the judgment that there was no community property.

Plaintiff and the decedent were twice married and lived together more than 20 years. The first marriage took place in Ventura County on December 8, 1923, at which time Mrs. Logan was a widow about 51 years of age and plaintiff was her junior by 19 years. She had inherited from A. J. Flores, her first husband, and at the time of her marriage to plaintiff was the owner of all the stock in a Mexican corporation which owned and operated a power and light business located in Mexicali, Baja California, Mexico. On the date of the marriage plaintiff was employed at a bank and earned a salary of $135 a month, while his wife’s income from her stock ownership in the utility company was approximately $3,000 per month. Mrs. Logan also owned a house in Los Angeles which she had inherited from Mr. Flores and in which she was residing when she died. At the time of her death she also owned or had an interest in certain real property in Los Angeles County, all of which she had inherited from her mother with the exception of property located in South Pasadena, which she purchased during her marriage and which was conveyed to her by an instrument describing her as a married woman.

Prior to Mrs. Logan’s first marriage in 1923, the Mexican utility company had been small, not too efficiently operated, and plagued by a degree of corrupt practices, waste and incompetence by certain of its employees. In 1921 Mrs. Logan employed her nephew, Mr. Chapman, and sent him to Mexicali to rectify these conditions. In subsequent years, with the installation of an improved organization under the direction of Mr. Chapman, who became manager and treasurer of the company, coupled with the growth and expansion of the city of Mexicali, the company began to prosper through the increased sale of electricity. In 1924 plaintiff and Mrs. Logan interrupted their European honeymoon to return to Mexico in order to obtain a new franchise after the old one had been cancelled. In March, 1925, Mr. Chapman resigned as manager of the utility company, after the company had shown a net profit of over $140,000 in the last three years of his tenure, whereupon Mrs. Logan became president, general manager and treasurer of the company. She retained those offices until the assets of the business were sold in 1943.

In 1925 Mrs. Logan purchased a residence in Mexicali and thereafter, until the sale of her business, resided there about *591 eight months of each year, spending the summer months annually in her Los Angeles home. During the 20 years following Mr. Chapman’s resignation the utility company was put in charge, successively, of three Mexican managers, who handled the entire business operation. Plaintiff testified that these managers and Mrs. Logan’s Mexican attorney, Mr. Barcenas, were in frequent telephonic communication with Mrs. Logan, held conferences with her from time to time about business transactions, and visited her house several times weekly as dinner guests where company affairs were discussed. Plaintiff further testified that Mrs. Logan was furnished daily reports concerning collections, disbursements and bank deposits. Mrs. Logan received no specified salary but made periodic withdrawals between 1937 and 1944 totaling $40,697 which were attributed to salary and reported as such to the Mexicali office of the Baja California Treasury Department.

The record is replete with oral and documentary testimony regarding the financial history and vicissitudes of the utility company. By 1928 the entire plant and operating system had been rebuilt, part of it with funds advanced by Mrs. Logan. In 1927, in addition to the 100 shares outstanding, 900 more shares were issued to Mrs. Logan, adding 450,000 pesos in capitalization. At that time, 300,000 pesos were charged to surplus and 50,000 pesos to the new franchise, while the remaining 100,000 pesos were charged to surplus in 1940. During the period 1932 to 1935, and again in 1938, the business operated at a loss. Between 1937 and the ultimate sale of the business in 1943 the financial statements of the company indicate a steady increase in the value of the physical plant largely due to a reinvestment in capital equipment of about 180,000 pesos. Between 1937 (the date of the second marriage) and 1944 Mrs. Logan received as dividends and salaries from the business about $88,000, of which $47,808 was denominated dividends and $40,697 as salary.

In 1929 Mrs. Logan became a Mexican citizen, and retained her Mexican nationality until she died. Plaintiff testified that her naturalization was undertaken on the advice of Mr. Barcenas, to avoid the impact of laws restricting the ownership of Mexican land by aliens and requiring governmental approval for the operation of a domestic industry by foreigners. Plaintiff testified that Mr. Barcenas counseled that Mrs. Logan should keep her own property in her separate name and should not engage any foreigners as employees or directors of her *592 company. The record shows clearly that Mr. Logan, who is an American citizen, was never officially connected with the company nor did he ever receive any salary from it and that the Logans at all times scrupulously kept their properties separate and apart. However, plaintiff testified that he assisted his wife in many ways in connection with the business operations, such as checking reports, participating in business conferences, and making purchases of materials, as well as representing her interests during a period of political turmoil' and labor unrest.

In 1934 Mr. and Mrs. Logan parted after a period of domestic infelicities during which time Mrs. Logan commenced an action for divorce in Los Angeles County, which was later dismissed because she was not a resident there. On November 26, 1934, a separation agreement was executed between the parties, in which the salient terms provided that: (1) All property of every kind standing in the name of either party and all property subsequently to be acquired was to be the separate property of such party; (2) Mrs. Logan was to pay $10,000 to plaintiff in settlement of all claims, including any for services and in lieu of support of plaintiff for the rest of his life; (3) there never had been any community property belonging to the parties and all property held by Mrs. Logan and its increments were her separate estate; (4) the parties waived alimony, court costs and counsel fees and right to support in any pending or future action; (5) plaintiff was to leave the house in which he resided with Mrs. Logan and the parties would henceforth live apart. On the date of the execution of their agreement Mrs. Logan paid Mr. Logan the $10,000 and he executed a grant deed conveying to Mrs. Logan title to all real and personal property standing in her name or possessed by her both in California and Mexico.

On September 9, 1935, Mrs. Logan procured a default divorce in Nogales, State of Sonora, Mexico, on the grounds of cruelty. The husband failed to appear, having been served by publication.

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Bluebook (online)
250 P.2d 730, 114 Cal. App. 2d 587, 1952 Cal. App. LEXIS 1213, Counsel Stack Legal Research, https://law.counselstack.com/opinion/logan-v-forster-calctapp-1952.