Saff v. Saff

61 A.D.2d 452, 402 N.Y.S.2d 690, 1978 N.Y. App. Div. LEXIS 9760
CourtAppellate Division of the Supreme Court of the State of New York
DecidedMarch 1, 1978
StatusPublished
Cited by41 cases

This text of 61 A.D.2d 452 (Saff v. Saff) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Saff v. Saff, 61 A.D.2d 452, 402 N.Y.S.2d 690, 1978 N.Y. App. Div. LEXIS 9760 (N.Y. Ct. App. 1978).

Opinions

OPINION OF THE COURT

Simons, J.

Appellant has obtained a divorce from respondent because he abandoned her. She appeals from so much of the judgment as denied her alimony and failed to impose a constructive trust on one half of all respondent’s separately owned property (with one minor exception). She asserts that our prior decision in Janke v Janke (47 AD2d 445, affd 39 NY2d 786) supports her claim for this relief.

In Janke a majority of this court affirmed a trial court decision that imposed a constructive trust in favor of a wife upon a one-half interest in her husband’s restaurant business. The Court of Appeals affirmed, noting that the case presented largely factual issues. In view of our affirmance of the trial court’s findings that the husband had made a promise to his wife which induced her to transfer funds to him, that she had managed the business relying upon this conduct, and that the husband had thereby been unjustly enriched, there was little else the Court of Appeals could do (see CPLR 5501, subd [b]) for the rules of constructive trust are well established and require proof of no more than that (see McGrath v Hilding, 41 NY2d 625; Sharp v Kosmalski, 40 NY2d 119).

Contrary to the suggestion of appellant’s counsel at the trial of this action and renewed here, the decision in the Janke case did not presage acceptance of an evolving concept of judicially imposed community property and we know of no appellate court decision which has. Certainly the Court of Appeals affirmance of Janke cannot be read to favor such a rule. On the contrary, the important point of Janke is that given a confidential relationship and the same factual findings as the majority made there, a constructive trust would have been imposed in any event, whether the parties were married or not.

In this case we do not find evidence to support imposition of a constructive trust and, therefore, we affirm the judgment.

Appellant and her husband were married in 1936. At the time appellant worked as a maid and respondent was unemployed. Over the next few years both worked at various jobs and gradually they accumulated a small reserve of funds which they held in their joint names. In 1946, after a few false [455]*455starts, respondent went into partnership with Wallace Dahl and the two men founded Jamestown Fabricated Steel as equal partners. Each man invested $2,000 but Dahl was short of cash and respondent loaned him $1,000 (later repaid) to purchase his half interest. The money for these payments came from the Saifs’ joint funds. In 1950 the company was incorporated and the capital stock was divided between respondent and Dahl. The company has prospered over the years and it is now estimated to have a net worth exceeding $500,000. In 1975 it grossed $590,000. Appellant has never had any legal interest in the business or in the corporate stock.

A minority of the court would grant appellant relief by imposing a constructive trust on one half of her husband’s stock in Jamestown Fabricated Steel, Inc., upon one half of whatever business profits respondent received from the corporation by way of profit sharing, and upon one half of the annual installments paid to respondent by the corporation to acquire real property formerly owned by him. In the alternative the minority believe her entitled to alimony in some unspecified amount.

Before the court may declare that respondent holds his separately owned property as a trustee for appellant’s benefit, appellant must prove that there was (1) a promise by him— express or implied, (2) which caused her to transfer property to him relying on the promise, (3) that a confidential relationship existed between the parties and (4) that respondent has been unjustly enriched at her expense by his conduct (Mc-Grath v Hilding, 41 NY2d 625, supra; Sharp v Kosmalski, 40 NY2d 119, supra; Janke v Janke, 47 AD2d 445, affd 39 NY2d 786, supra). In deciding these matters on appeal, we are obliged to view the record in a light most favorable to sustain the trial court’s judgment and give due deference to its findings on credibility (Van Roo v Van Roo, 268 App Div 170, 172, affd 294 NY 731; McCall v Town of Middlebury, 52 AD2d 736).

Marriage is a confidential relationship, of course, and there was a transfer of funds and labor by appellant to respondent. The remedy of constructive trust, however, requires that more be shown. There must be proof that the transfer was made in reliance on a promise that the property transferred would be held for the benefit of appellant, and that respondent was enriched unjustly by retaining the fruits of the transfer.

[456]*456We find no express promise by respondent. Appellant testified that from 1946 to 1960, apparently after the purchase of the business, respondent told her on various occasions, "Baby girl, what is mine is yours; you’re my wife. It’s always all half yours, you’re my wife.” Such representations undoubtedly reflected the emotions of a happier time but they most assuredly did not constitute a promise by respondent that he held one half of his corporate stock as trustee for appellant (see Vassel v Vassel, 40 AD2d 713, affd 33 NY2d 533). The statements meant precisely what most people would interpret them to mean—not that appellant had a proprietary interest in every personal belonging of respondent, be it clothing or corporate stock, but rather that the parties would share their successes equally in raising their family and enjoying their life together.

Failing an express promise, appellant contends there was an implied promise. Unquestionably an implied promise may be sufficient if the evidence otherwise supports a finding that respondent holds property as trustee for another (Sharp v Kosmalski, 40 NY2d 119, 122; Sinclair v Purdy, 235 NY 245, 254; Janke v Janke, supra; Farano v Stepheanelli, 7 AD2d 420). Such promises may be inferred from the factual circumstances and setting of the parties and they frequently are when the conduct of the injured party is otherwise inexplicable (see e.g., Sharp v Kosmalski, supra). The fact of the marriage is an important consideration indicating a confidential relationship between the parties, but standing alone it does not provide the basis for an implied promise which will support a constructive trust (Moftiz v Moftiz, 50 AD2d 901). Furthermore before a court implies a promise between husband and wife for purposes of a constructive trust, it must be careful to separate those promises going to the marriage relationship and those going to a business relationship. The two may not be mixed together in some sort of salmagundi, as the minority has done, to find an implied promise that the wife will share in the ownership of a specific business because of such unrelated acts as her employment as a maid or drill press operator, her care of the children or her handling of the family finances. The remedy of constructive trust may not be applied randomly to adjust general equities between spouses or as a punitive measure to divvy up a husband’s separately owned property because of his past indiscretion.

In this case the marriage relationship cuts against a finding [457]*457of implied promise to hold one half of respondent’s interest in the corporation for the benefit of appellant.

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Cite This Page — Counsel Stack

Bluebook (online)
61 A.D.2d 452, 402 N.Y.S.2d 690, 1978 N.Y. App. Div. LEXIS 9760, Counsel Stack Legal Research, https://law.counselstack.com/opinion/saff-v-saff-nyappdiv-1978.