Wolford v. Farnham

46 N.W. 295, 44 Minn. 159, 1890 Minn. LEXIS 317
CourtSupreme Court of Minnesota
DecidedJuly 21, 1890
StatusPublished
Cited by18 cases

This text of 46 N.W. 295 (Wolford v. Farnham) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wolford v. Farnham, 46 N.W. 295, 44 Minn. 159, 1890 Minn. LEXIS 317 (Mich. 1890).

Opinion

Gilfillan, C. J.

This is an action to declare and enforce a trust under Gen. St. 1878, c. 43, § 8, in favor of plaintiff as a creditor of the defendant Sumner W. Farnham, in land conveyed by one Butler to the defendant Eunice E. Farnham, upon a consideration, as claimed by plaintiff, paid by Sumner W. in fraud of his creditors. The action was tried in the court below without a jury, and findings of fact made, and judgment ordered and entered, in favor of the defendants. The conveyance by Butler to defendant Eunice E. was made March 16,1883, for a consideration of $35,000, of which $20,000 was paid with money unquestionably belonging to the latter. The only controversy with respect to whose money paid the consideration was with regard to the other $15,000. This was paid by a cheek drawn by Sumner W. for $5,000, and another drawn by the firm of which he was a member for $10,000, to take up a loan he had made in his own name to another firm. Upon these facts the $15,000 so paid was prima facie the money of Sumner W., and, as a part of the indebtedness to plaintiff was then owing, the payment of the $15,000 was, under the section referred to, presumptively fraudulent as to what was then owing to plaintiff. The burden was then on the defendant to disprove a fraudulent intent in so paying that part of the consideration.

[161]*161But the defendants claim, and the court found as a fact, that the $15,000 so paid was the money of Eunice E., and not that of Sumner W. If that finding be correct, the plaintiff’s action has no foundation. The court, however, also found the facts- upon which it arrived at the conclusion that the money belonged to Eunice E. This part of the case rests, therefore, on the sufficiency of those facts to support that conclusion. Stating those facts briefly, they are, in substance, that in June, 1878, Eunice E. was the owner of an undivided one-third of certain real estate on Hennepin island, Minneapolis, and it was then orally agreed between Sumner W. and her that she should convey the one-third to him, and that he should hold her interest in it for her until it should be sold, and that upon the sale of it the purchase price should be paid to and belong to her. Pursuant to such oral agreement, the defendants, being husband and wife, executed to Frank W. Farnham a deed conveying to him the one-third interest, and he thereupon conveyed to Sumner W. As we understand, each deed was absolute in terms, and made no reference to the terms of the parol agreement. In April, 1882, the whole of the real estate was sold, and the purchase price was received by one of the tenants in common, and he deposited the Farnham share of it ($37,500) to the credit of Sumner W. in the same bank upon which the latter afterwards drew the check for $5,000. Sumner W. communicated the facts of the payment and deposit to Eunice E., and she authorized him to invest the money for her, and for that purpose to draw checks against it. The loan taken up by his firm with the check for $10,000 was made by him out of the money so deposited, but was made in his own name. But it is not found that he ever, before paying the $15,000 as part of the consideration for the land conveyed to her, transferred any part of the $15,000 to her. Up to that time it stood in his own name, apparently his own property.

It must be apparent that, if the money received upon the sale of the third interest in the Hennepin island property did not belong to Mrs..Farnham as soon as it was paid by the purchaser, it did not, •so far as concerns the $15,000 at-anyrate, become hers by anything done between that time and the transaction assailed in this case.' [162]*162The mere intention to invest it for her or to pay it to her would not make the money hers. Leonard v. Green, 34 Minn. 137, (24 N. W. Rep. 915.) There can be no doubt that parties to a trust, void merely because not in writing, may, as concerns themselves, at any rate, execute it by performing what'it requires. Had Summer W., upon the sale of the third .interest in the Hennepin island property, paid or transferred the purchase-money to Eunice E. in performance of the parol trust,- that act would have been binding, and the money would have become hers as between the two. But that was not done as to the $15,000. So-that her title or claim of title to the money must rest upon the parol agreement made when that property passed from her to him. It is objected to that agreement that it was an attempt to create a trust in the land, and was void because not in writing. No trust in lands, except those arising by implication or operation of law. can be created unless by deed. If, therefore, the parol agreement was ar attempt to create a trust in the land or a power in trust, it was, of course, of no effect. To show that- such was the character and purpose of ihe agreement, needs only a statement of n> as it was found by the court oelow. It -was to hold her interest in the land for her until sold, and when sold to pay the proceeds to her. Give effect to this agreement, and Sumner W. had nothing in the land but the bare legal title, the entire beneficial interest being in Mrs. Earnham. Had the terms of the agreement been inserted in the deed from Frank W. to Sumner W., the legal title would have vested at once jn Mrs. Eaínham, and Sumner W. would have taken nothing. Had they been inserted in her deed to Frank W., the deed would have been inoperative. The case is in most respects analogous to Randall v. Constans, 33 Minn. 329, (23 N. W. Rep. 530,) in which the oral agreement was that the grantee should take a conveyance and hold the premises in trust for the benefit of a person named, to collect the rents,' pay taxes and incumbrances, sell the land, and account for and pay over the difference between the sums received and those paid by him. The court in that case held that an action on the agreement would not lie to enforce the promise to pay over the net proceeds, for “it would be equivalent to ingrafting a power in trust by parol upon an absolute deed.” We need not con-[163]*163aider whether Mrs. Farnham would have had a remedy, and, if so, what, for obtaining the conveyance and then refusing to carry out the parol agreement by means of which it was obtained. • The right to a remedy, if any, would have been in action, and, certainly, until enforced, could not have affected the title of Sumner W. to the land, or to the money received upon the sale of it. The question here is, whose money was it ? and that is determined by the only valid agreement, to wit, the deeds.

But while the facts do not show any valid trust upon the transfer of the Hennepin island property, nor that the money derived from a sale thereof was the money of Mrs. Farnham, it does not follow that the evidence introduced from which the court found the facts was obnoxious to the objection made to it that it was incompetent, irrelevant, and immaterial. The offer of the evidence was not limited to any particular issue, but was general. If competent to prove and relevant to any of the issues in the cause, it was admissible. In addition to the issue as to whose money was used in paying for the land conveyed to Mrs. Farnham, was the other issue — material in case the money was that of Sumner W. — was it paid by him, upon the conveyance made to her, with a fraudulent intent ? And on this issue the evidence referred to was proper; for if it tended to prove, as well it might, that the Farnbams in good faith believed the money belonged to Mrs.

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Bluebook (online)
46 N.W. 295, 44 Minn. 159, 1890 Minn. LEXIS 317, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wolford-v-farnham-minn-1890.