Mills v. Mills

1973 OK 74, 512 P.2d 143, 1973 Okla. LEXIS 520

• Court: Supreme Court of Oklahoma
• Decided: June 26, 1973
• Docket: 43413
• Status: Published

Opinions

DOOLIN, Justice.

The pleadings and facts in this case frame for us, among other issues, a question of first import:

Are the declaratory judgment statutes available for the determination of rights established by final decree entered by a court of competent jurisdiction? (12 O.S.1971 § 1651 et seq.)

The Wife, plaintiff, and the Husband, defendant, were divorced October 31, 1952, in the District Court of Oklahoma County; and as a part of the divorce proceedings the parties had executed a contract and property settlement covering real and personal property located in at least two counties in Oklahoma, which had been accumulated by the parties during coverture. Both parties agree that the contract was incorporated in the decree of divorce, by the trial court in October of 1952.

Among the various tracts of land described in the contract was:

Lots 19, 20, 21, 22 and the N20' of Lots 23 and 24, Wert’s Addition to Oklahoma City, Oklahoma,

which was incorporated into the decree and set over to the parties by the property settlement in the following manner: (We substitute H for Party of the First Part and W for Party of the Second Part) :

“H shall have the control and management, and shall hold the title thereto, subject only to the right of W to part of the net rental and part of the net sale price, as herein provided, and H shall have sole discretion in the sale of said property and shall have the sole right and discretion in the leasing or renting of said property, and shall have the right to convey said property without the joining of W, provided, that any sale made shall be for an adequate consideration, and provided further, that H shall have and receive and keep all rents and income from said property, paying all taxes, expense of upkeep and any other cost and expense that may arise, without claim of W thereto, for a period of eight (8) years from this date, or for the period of time that the sons of the parties are in school pursuing their education and H is paying all their expenses and maintenance. At the expiration of eight (8) years from this date, or at such time as the sons of the parties have completed their education, whichever occurs first, H shall pay over to W — half of the net rents and income from the said property as said rents and income is collected and received, and in the event H shall sell the said property, at any time from and after this date, W shall be entitled to receive one-third of the net proceeds of the sale thereof.”

Plaintiff, Wife, also sought an accounting from the Defendant, Husband, as to rents and profits from the real premises heretofore described. In addition to the rents and profits from last mentioned premises, the evidence as developed shows acquisition of adjoining property by second wife of Husband.

Wife’s Petition seeking an accounting, determination of her interest in real property, costs, etc., was tested by Husband’s demurrer and motion to separately state and number. The demurrer was overruled and the Husband was given time to answer. In his answer Husband made general denial, cited the divorce decree and incorporated property settlement and by way of separate defense denied that the Wife was entitled to determine her rights under the Decree or to seek construction of the same. Husband also denied that a justicia-ble controversy existed between the parties and that Plaintiff’s interests were vested, undivided fee interests. He pleaded that he had previously fully accounted to the Plaintiff. At pretrial while discovery was continuing the parties agreed that Plaintiff sought (a) a declaratory judgment as to her property rights under the divorce decree and contract; and, (b) accounting of rental income from properties. Both parties announced at this time that they were ready for trial.

Trial was completed June 25, 1968. Findings of fact as requested by Wife and conclusions of law were entered by the court on July 16, 1968, the judgment and decree of the court being likewise entered on July 16, 1968. Such findings of fact and conclusions of law were favorable to the Wife; the court specifically found that a declaratory judgment action would lie and such statutes were applicable to interpret the decree of divorce entered in October of 1952. Further the court found and concluded that the property settlement executed by the Husband and Wife at the time of the original divorce had been merged in the decree. If then construed and interpreted the provisions of the original divorce decree fixing property rights in the parties and required the Husband to make certain payments to the Wife by way of an accounting.

We first address ourselves to the question of the applicability of declaratory judgment actions to decrees of divorce.

Early cases in Oklahoma, Finley v. Finley, 174 Okl. 457, 50 P.2d 643 (1935) and McRoberts v. McRoberts, 177 Okl. 156, 57 P.2d 1175 (1935) hold that settlement agreements between Husband and Wife are extinguished by entry of a divorce decree. They likewise preclude subsequent action based thereon holding that 12 O.S. 1971, § 1279 is a bar to any claim of either party to the property of the other. In McRoberts, supra, it was stated that “it (divorce decree) usually is held to mean just what it says.” Later in Jones v. Jones, 442 P.2d 319 (Okl.1968) we held:

“Property settlement agreement incorporated by divorce decree acquired dignity of judgment and could be vacated or modified only by compliance with the statutes, 12 O.S.1971 §§ 1031 and 1038.”

Since the trial court felt that the agreement was merged in the decree or incorporated therein, we will resist the opportunity of an exercise in semantics as to the difference between “merged” and “extinguished”, but suffice it to say that no attempt by the Husband or Wife was made at the time of the decree of divorce to appeal or to vacate or modify the decree.

That the Federal statutes covering declaratory judgment actions have been used to interpret rights under an Oklahoma divorce decree is not questioned. Kelso v. Kelso, 10 Cir., 225 F.2d 918 and 246 F.2d 421. In passing we note that the Federal statute, 28 U.S.C. § 2201 et seq., predates the Oklahoma act and differs therefrom.

The briefs of the parties and our research indicate that there is conflict as to whether a court may entertain a declaratory judgment action to clarify or interpret final decrees. We find no case that would allow a declaratory judgment action to lie as a substitute for an appeal.

In National-Ben Franklin Fire Insurance Co. v. Camden Trust Company, 36 N.J.Super. 249, 115 A.2d 589 (1955), the New Jersey court held that where a justiciable controversy existed then its declaratory judgment act would grant relief to determine the significance and effect of a judgment, citing cases from California, Connecticut, Kentucky, Ohio and Tennessee. This position is ably argued by the Wife and disputed by the Husband in their briefs.

The Wife argues that §§ 1651 and 1657 of Title 12 O.S.1971 have made decrees of courts of record in this state subject to the relief of a declaratory judgment action. She states that 12 O.S.1971 § 1657 specifically excepts from the Oklahoma act decrees of the Corporation Commission, Industrial Court, other agencies, boards, etc., and that therefore courts of record are subject to the act. Appellee Wife cites 82 C.J.S. Statutes § 382, page 893, in support thereof:

“It is a general rule that an express exception excludes all others, that is, an exception in a statute amounts to affirmation of the application of its provisions to all other cases not excepted, but it is alzvays proper in determining the applicability of this rule to inquire zvhether, in a particular case, it accords with reason and justice.” (Emphasis supplied.)

We do not believe that our statute, 12 O.S.1971 § 1657, intended to place final judgments of courts of record, the strong right arm of the judiciary, subject to declaratory judgment actions and remove all other administrative agencies, boards or commissions from such review. To do so, in our opinion, would unnecessarily prolong litigation and provide a new and novel method of modification or appeal. Such interpretation would radically extend procedures, not only in divorce cases, but all others, far beyond existing appeal statutes and statutes allowing vacation of judgments.

We are persuaded that the better reasoned cases concerning declaratory judgment actions hold that a judgment of a court of record may not be interpreted or clarified by the act, 22 Am.Jur.2d Declaratory Judgments § 17:

“As a general rule once a controversy has been adjudicated by a tribunal having jurisdiction of the parties and the subject matter, the controversy is no longer an actual one and therefore cannot be the subject of a declaratory judgment action.”

The Supreme Court of the State of Utah in Crofts v. Crofts, 21 Utah 2d 332, 445 P. 2d 701, held that there cannot be a declaratory judgment on a judgment, first because such an action was not within the terms of the Utah statute, similar to ours, and second :

“ . . . the finality of a judgment must be respected in order to insure the rights of parties.”

The logical conclusion of allowing a declaratory judgment action to be applicable to final judgments and decrees is stated in Alabama Public Service Commission v. AAA Motor Lines, Inc., 272 Ala. 362, 131 So.2d 172, cert. den. 368 U.S. 896, 82 S.Ct. 173, 7 L.Ed.2d 93:

“An action for declaratory judgment cannot be made a substitute for appeal; if the rule were otherwise, a declaratory proceeding would lie to determine whether a prior declaratory proceeding was erroneous, and there would be no end to that kind of litigation.”

This is not a desirable result.

We believe, after a careful weighing of the record, that much of what the Appellee Wife really sought by her action was in the nature of appellate relief or a second trial of identical issues — previously adjudicated by the decree of divorce. Much of her evidence is likewise directed to her prayer for an accounting and to the values, and rentals of properties covered by the divorce decree and the allocation of rental from the common tenant of the divorce properties in question and subsequently acquired properties of Husband’s second wife.

The case before us most resembles Glassford v. Glassford, 26 Ariz. 220, 262 P.2d 382 (1953). In that case the husband and wife entered into an agreement during divorce procedures wherein the husband agreed to pay the wife a percentage of his gross income, the wife agreed to waive certain rights in real and personal property, and to execute releases and instruments concerning such property. Each released the other from any and all claims except for the payments provided in the agreement, such as in the instant case. They agreed further that the contract should be a part of any decree of divorce thereafter entered, and the agreement was incorporated and made a part of the final judgment. Several years after the final decree had been entered, the wife filed a petition seeking, among other things, interpretation and construction of this decree under the Arizona Declaratory Judgment Act. She also sought an accounting; but the parties made amiable disposition of the accounting and removed this issue from the case. The trial court held that a declaratory judgment was proper and proceeded to interpret and construe the final decree and ordered relief favorable to the wife. On appeal the Supreme Court of Arizona reversed and stated that its Declaratory Judgment Act did not authorize or contemplate interpretation or construction of a final decree:

“ . . . The act (declaratory judgment act) does not expressly or by implication authorize a court to entertain a proceeding to determine any questions of the construction or validity of a judgment or decree of a court of competent jurisdiction, or to declare the rights or legal relations of interested parties thereunder.

It is our conclusion, . . . , that our declaratory judgment statute does not contemplate a declaration of one’s status or rights under a decree of a court of competent jurisdiction and that, therefore, plaintiff has not established a right to a declaratory decree.”

The wife in Glassford claimed that her action was based primarily upon the contract and therefore was specifically covered under the Arizona Act. The Oklahoma Act, 12 O.S.1971 § 1651, also specifically mentions and refers to contracts as being subject to declaratory judgment action. In answer to the wife’s argument advanced in Glassford, as to contract, the Arizona court stated at page 386:

“We have, . . . , conclusively settled that once the contract is merged into the decree, any action taken must be based upon the decree of the lower court and not based upon the contract of the parties.

In effect, the plaintiff in this action sued for declaratory judgment for the construction of a valid judicial decree of a court of competent jurisdiction and not as an action on the contract of the parties.”

This rule and holding is identical to ours in Jones v. Jones, supra, and we arrive at the same conclusion, as in Glassford.

We, therefore, specifically hold that Oklahoma’s Declaratory Judgment Act, 12 O.S.1971 § 1651 et seq., may not be used to interpret or determine rights fixed by a final decree of a court of competent jurisdiction.

It likewise follows that the judgment of the trial court (including its findings of fact and conclusions of law) dated July 16, 1968, wherein the trial court attempts to define, fix, enlarge or detract from the interests of the Husband and Wife should be vacated and set aside.

We do not infer that either the Husband or the Wife has no remedy, but decline to comment thereon.

The Husband next contends that judicial interpretation of 12 O.S.1971 § 1278 requires the trial court in a divorce action to divide all real property in a property settlement into fee simple estates. The Husband argues that since the parties took a lesser estate in the real property by the 1952 divorce decree, this portion of the 1952 property settlement is void. In support of his argument, the Husband relies on the cases of Kupka v. Kupka, 190 Okl. 392, 124 P.2d 389; Brannon v. Brannon, 207 Okl. 529, 250 P.2d 447; Lawson v. Lawson, Okl., 295 P.2d 769; Blount v. Blount, Okl., 425 P.2d 474; and Williams v. Williams, Okl., 428 P.2d 218. While that line of authority clearly does support the rule, it is subject to the qualification that the parties to the divorce may agree to a division of the property in less than fee simple estates and thus waive the application of this statute. See Lawson and Bloimt, supra. In Lawson, supra, this court said:

“. . . In many instances in divorce cases the parties are agreeable to the ownership of the property in common, as evidenced by contract. . . .”

and in the Syllabus by the Court:

“Unless its application is waived by the parties the statutory provision relating to division of the property between divorced parties intends that [the] property be so divided that the portion awarded to one spouse is free from the claims or domination of the other, and there is a complete severance of common title.” (Emphasis supplied.)

We hold that since the parties entered into a property settlement agreement negotiated by parties and their attorneys and providing for division of certain properties in less than fee simple estates, that 12 O.S.1971 § 1278 does not apply to render such division void, for such parties have waived their rights to complain and the decree based thereon has long since become final.

We turn to the Wife’s rights to an accounting.

Declaratory judgment actions and actions for an accounting are separate and distinct causes of action, albeit somewhat similar. It is axiomatic that an accounting action is based upon a relationship created by contract or supplied by a fiduciary relation (and thus created by law) between the parties. What acts of the parties or final orders of the trial court in its decree of October, 1952, have entitled the Wife to an accounting ?

It is the agreement of the parties incorporated in the October, 1952, decree of divorce which supplies the necessary relationship, specifically:

“It is agreed between the parties that, as to the following described real estate, situated in Oklahoma County, Oklahoma, to-wit:

Lots Nineteen (19), Twenty (20), Twenty-one (21), Twenty-two (22) and the North 20 feet of Lots Twenty-three (23) and Twenty-four (24), WERTS ADDITION to Oklahoma City, Oklahoma, as shown by the recorded plat thereof,

(which is leased to Carnation Milk Company, or Carnation Ice Cream Company, and upon which there is a mortgage, the balance of which is approximately $6450.00), H shall have the control and management, and shall hold the title hereto, subject only to the right of W to part of the net rental and part of the net sale price, as herein provided, and H shall have sole discretion in the sale of said property and shall have the sole right and discretion in the leasing or renting of said property, and shall have the right to convey said property without the joining of W, provided, that any sale made shall be for an adequate consideration, and provided further, that H shall have and receive and keep all rents and income from said property, paying all taxes, expense of upkeep and any other cost and expense that may arise, without claim of W thereto, for a period of eight (8) years from this date, or for the period of time that the sons of the parties are in school pursuing their education and H is paying all their expenses and maintenance. At the expiration of eight (8) years from this date, or at such time as the sons of the parites have completed their education, whichever occurs first, H shall pay over to W one-half of the net rents and income from the said property as said rents and income is collected and received, and in the event H shall sell the said property, at any time from and after this date, W shall be entitled to receive one-third of the net proceeds of the sale thereof.”

In her Petition filed in the trial court, the Wife alleges that the Husband failed and upon demand refused to account to her for her share of those rentals; that the Husband, in exercise of control of the properties which produce said rentals had devised a complex plan for allocation of those rentals; and, that in the exercise of control of such properties a constructive trust for the benefit of the divorced Wife had been created. In the case of Vilbig Const. Co. v. Whitham, 201 Okl. 86, 201 P.2d 922 (1949), this Court held that the essentials of equitable jurisdiction in an action on account are the need of discovery, the complicated character of the accounts and the existence of a fiduciary or trust relation. Wife’s evidence shows that these essentials are present in the case, and we hold that the trial court was correct in upholding and acting upon the Wife’s prayer for an accounting. This Court has held that an accounting:

. . contemplates a full and complete investigation of the mutual acts of the parties and the striking of a balance and rendition of judgment in favor of the party entitled thereto.”

Clark v. Addison, Okl., 311 P.2d 256; Finley v. Concho Const. Co., Okl., 388 P.2d 863. In light of this doctrine we find that the trial court was within its authority in allocating or making Husband account to Wife for the rentals due under the 1952 divorce decree, and we will not reverse the findings of fact of the trial court unless clearly against the weight of the evidence, Harris v. W. R. Hart & Co., 195 Okl. 5, 154 P.2d 759 (1944).

The Husband argues that the trial court’s allocation of rentals due the Wife was improper in that it operates to deprive his current wife who is not a party to this action of some of the rentals due from properties owned by her and the Husband and rented in parcel with properties in which the Wife has some interest. This does not follow, since the only portion of the properties rented in parcel that the Husband can be compelled to pay the Wife’s share of the rentals from is that portion he controls under the 1952 divorce decree. The 1952 property does not include any property in which the second wife has an interest and it is not burdened by payment to the first Wife. Although as a general rule all persons interested in the subject matter should be made parties to a suit for an accounting, 1 C.J.S. Accounting § 37(c)(1), the parties to this action have not shown us authority nor has our own research revealed authority which requires the owner of unburdened property to be made a party before relief can be granted a Wife whose cause of action is only against the Husband.¹ For this reason, the second wife is not, in our opinion, a necessary party.

Lastly, we deal with Husband’s challenge to the October, 1952 decree of divorce as being void because the sums ordered paid were alimony and were not in a fixed amount or for a determinable time.

Examination of the record as to the last mentioned point reveals that the Husband produced no evidence in support of this proposition, and other than the decree itself and the contract executed by the parties there is a total absence of evidence in support of or in opposition to his proposition. We observe that at the time of pretrial hearing the parties did not frame or suggest to the court that such a question was to be decided. Examination and consideration of the trial briefs of the parties and the depositions indicates that no serious attack upon the October, 1952, decree was made or contemplated under this proposition, until Husband’s motion for new trial and his suggested findings of fact and conclusions of law were made. We further find that the Husband made no effort to amend his pleadings to conform to the proof of this point.

In short, the record before us does not suggest a conclusion or finding that the decree of divorce was void on the grounds that the sums ordered paid by the Husband to the Wife was alimony, and as such void because the amount and duration .'thereof was not fixed and definite. Walker v. Walker, 310 P.2d 760 (Okl.1957):

“A case presented on appeal will be reviewed on the theory upon which it was presented to the trial court.”

See Arnold v. Arnold, 194 Old. 571, 153 P.2d 224 (1944):

“Matters which were not involved in trial court and may not properly be presented for first time on appeal will not be considered by [the] Supreme Court.”

Husband’s attack on the judgment of the court under this last proposition is obviously new matter not supported by the record and not presented for adjudication. The parties themselves at the time of pretrial agreed on the issues; they were (a) application of the Declaratory Judgment Act and (b) Wife’s right to an accounting. Application of the Declaratory Judgment Act might be broad enough to grant relief to the Husband under this proposition; but, unfortunately for him, we have decided against the applicability of such Act to a final judgment of a court of competent jurisdiction. We also believe that when he concedes that he has granted an accounting in full, he concedes the legality of the decree in question. See also Mead v. Mead, 301 P.2d 691 (Okl.1956):

“On appeal by wife from judgment refusing to vacate judgment in favor of husband in divorce action, Supreme Court would not consider pleadings of wife as having been amended to conform to the proof, where to do so would involve consideration of a ground of vacation, which was neither alleged in her pleadings nor urged at the trial, but was asserted for the first time in appeal brief in attempt to obtain reversal of the trial court’s judgment.”

From a consideration of the evidence and record as a whole, we hold that judgment based upon the Declaratory Judgment Act of the State of Oklahoma should be reversed with directions to vacate, and judgment for accounting should be sustained.

WILLIAMS, V. C. J., and IRWIN, BERRY, LAVENDER and SIMMS, JJ., concur. DAVISON, C. J., and HODGES and BARNES, JJ., dissent.

1 . In the case of Glassford v. Glassford, supra, the defendant’s second wife was permitted to intervene and was not held to be necessary party.