Van Buskirk v. Van Buskirk , 378 Pa. Super. 418 ( 1988 )

WIEAND, Judge:

In this divorce action, the trial court held that real estate, the record title to which was held by third persons who were not parties to the action, was marital property and directed that husband pay to wife a portion of the value thereof in exchange for a quitclaim deed conveying wife’s interest in the real estate to husband. Husband appealed. We reverse.

MarySusan and Gary Van Buskirk were married in 1972 and separated in 1982. One child, Jessica, was born of their marriage. MarySusan was employed as a retail sales clerk, and Gary was employed as a construction worker. The parties did not own real estate and had lived in rented properties throughout their marriage.

Gary’s parents, Roe and Jean Van Buskirk, owned a tract of land in Hamilton Township, Monroe County, on which their residence was located. The tract had been owned by the Van Buskirk family since 1925. In December, 1978, Roe and Jean Van Buskirk caused a deed to be prepared for 1.889 acres, a part of the larger tract on which their residence was situated, and named therein as grantees their son and daughter-in-law, Gary and MarySusan Van Bus-kirk. This deed was executed on December 29, 1978 in the office of a notary public, who also took the acknowledgement thereof. The deed, however, was not delivered; neither was it recorded. Instead, the deed was retained by the grantors. Roe Van Buskirk testified that he had not intended to deliver the deed unless and until his son and daughter-in-law, who were then experiencing marital difficulties, were able to get things “patched up” between them. He explained that the deed had been executed to give his son and daughter-in-law an expectation which would help solidify their marriage. Delivery was to occur in the future only if the younger Van Buskirks were able to stabilize their marriage.¹

Following the signing of the deed, Gary Van Buskirk, with assistance from his wife and parents, expended time, effort, and some money in constructing a partially completed residence on the lot. Most of the financing, however, was arranged by Roe and Jean Van Buskirk, who personally borrowed the necessary money. The loan was secured by a mortgage executed by the elder Van Buskirks and constituting a lien on the entire tract which they owned, including their residence, in Hamilton Township. Mortgage payments, including interest, were made by the elder Van Buskirks, who also paid taxes and the cost of insurance. The younger Van Buskirks, who occupied the partially completed dwelling, paid rent to Gary’s parents. When the marriage of the younger Van Buskirks deteriorated further, Roe Van Buskirk determined that he and his wife would not make a gift of the real estate and destroyed the deed.

The trial court held, despite the undisputed fact that the deed had not been delivered, that a completed gift of the real estate had nevertheless been made. Therefore, the court directed that Gary Van Buskirk pay one-half the equity in the partially completed residence ($18,066.78) to MarySusan Van Buskirk, who was directed to execute a quitclaim deed conveying her interest in the real estate to Gary Van Buskirk.

This was error. It is essential to the validity and effectiveness of a deed that there be a delivery of the deed. See: Fiore v. Fiore, 405 Pa. 303, 174 A.2d 858 (1961); Rynier’s Estate, 347 Pa. 471, 32 A.2d 736 (1943); In re Estate of Darlington, 364 Pa.Super. 75, 527 A.2d 159 (1987).

To make a valid gift there must have been not only an intention to make it but to do so at the time and not in the future, and it must be accompanied by an actual or constructive delivery to the donee by which the donor released all dominion over the property and invested the donee with full title to and control over the same.

Tradesmen’s Nat’l Bank & Trust Co. v. Forshey, 162 Pa.Super. 71, 73, 56 A.2d 329, 331 (1948) (quoting cases). See also: In re Rogan’s Estate, 404 Pa. 205, 212, 171 A.2d 177, 180 (1961) (intent of donor to make an immediate transfer is essential). “Since it is impossible to make manual delivery of real property, delivery of the deed of such property is necessary to render it legally operative and to convey title. The deed becomes operative when delivered with the intent that it become effective as a conveyance____” 12 P.L.E. Deeds § 41. “[A] sufficient delivery of a deed requires that there be a manifestation of the unequivocal intention of the grantor to relinquish all dominion and control over the instrument and to have it become presently effective as a transfer of title, so as to deprive the grantor of all authority over it or the right of recalling it____ There is no delivery in law where the grantor keeps the deed in his own possession with the intention of retaining it, particularly if he keeps possession of the property as well.” 23 Am.Jur.2d Deeds § 131.

In the instant case, not only was the deed not delivered, but the elder Van Buskirks retained dominion over the instrument and the real estate. They used the land as security for money which they borrowed; and they also continued to pay taxes on the land and kept insured the improvements thereon.²

Moreover, if the elder Van Buskirks were to have their record title defeated in this marital action, it was essential, at the very least, that they be made parties to the action. Provision therefor has been made in Pa.R.C.P. 1920.34. Without such joinder, the trial court was powerless to construct a trust or otherwise divest the grantors of their title and vest it in their son and daughter-in-law. The note to Pa.R.C.P. 1920.34 makes this patently clear when it states that “[t]he joinder of persons other than husband and wife may be essential ... where persons other than the parties have an interest in property which is the subject matter of a distribution.” See also: 1 Pa.Matr.Prac. Jurisdiction § 13:5.1; Wolf v. Wolf, 356 Pa.Super. 365, 514 A.2d 901 (1986) (trial court may declare resulting trust where record owners of real estate have been joined in matrimonial action).

The trial court, in this case, attempted to deprive the elder Van Buskirks of the title to their real estate without their having been joined as parties to the divorce action. At the very least, the court has thereby created a cloud on their title which, if not removed, will impair the marketability of the land. This was an abuse of discretion and clearly erroneous.

If unreversed, the trial court’s order will also have unfair consequences for Gary Van Buskirk, the husband-appellant. He does not have title to the real estate which the trial court determined to be marital property. At best, he may have a possible action in equity against his parents to impose a constructive trust on the real estate. Whether he can produce evidence in addition to that appearing in the record of the divorce action which will enable him to pursue such an action successfully is entirely speculative. In the meantime, because he does not own the real estate, Gary Van Buskirk can neither sell the real estate nor use it as security for a loan to raise the sum of $18,066.78 which he has been directed to pay to his wife. The record demonstrates that Gary Van Buskirk, a construction worker, does not otherwise have assets which will enable him to pay this sum of $18,066.78 to his wife. The Divorce Code does not authorize courts, under the guise of equitable distribution, to impose an order to pay money which a party does not have the ability to pay. Miller v. Miller, 352 Pa.Super. 432, 443-444, 508 A.2d 550, 556 (1986).

Not only does the record fail to show that the husband can pay the amount which he has been directed to pay, but it also is uncertain, as we have observed, that he will ever be able to acquire title to the real estate which the trial court has held to be marital property. If he should find a way to raise the money which the court has directed him to pay, he still will not have title to the real estate. He will have nothing but an undetermined and speculative claim which he may be able to assert in a court of equity. Under the circumstances demonstrated by the record in this case, it is doubtful that he will be successful in wresting title from his parents in a future action. To place the entire risk of such an action upon appellant, under the circumstances of this case, was a manifest abuse of discretion.

On the record reviewed by this Court, the trial court’s finding that the 1.889 acre tract in Hamilton Township was marital property is unsupported. The record title to that real estate is held by third persons who have not been joined as parties in the present action. To require the husband-appellant to pay one-half of the difference between the value of such real estate and the unpaid balance of a mortgage thereon executed and delivered by the third party owners was error.

The order of the trial court is modified by vacating the second paragraph thereof which directed Gary J. Van Bus-kirk to pay the sum of $18,066.78 to MarySusan Van Buskirk, who was directed to execute a quitclaim deed for a 1.889 acre tract in Hamilton Township, Monroe County.

BECK, J., files a dissenting opinion.

1 . Although the Master recommended that Roe Van Buskirk’s explanation for non-delivery of the deed be found "contradictory and not believable,” the trial court did not make such a finding. Even if the witness’s explanation were to be rejected, however, it would not alter the undisputed fact that the deed had not been physically delivered.

2 . The author of the dissenting opinion argues that there was a constructive delivery of the deed. However, there is no evidence to support this argument. Not only was the deed not recorded, but it was never placed within the control of the grantees. Instead, the grantors continually retained the deed and exercised dominion over it.