Owens v. Owens , 196 Va. 966 ( 1955 )

Whittle, J.,

dissenting

I find no fault with the general equitable principles recited in the concluding portion of the majority opinion. My position is that these principles are entirely foreign to the case presented in the bill and answer, and, to a large degree are not applicable to the new case constructed by and considered for the first time in the opinion.

The case properly before us as disclosed by the pleadings and relevant proof is not difficult. W. C. Owens and A. J. Owens were the sons of H. S. Owens, deceásed. These two brothers and their mother, Laura Owens, the widow of the deceased, were his only heirs at law when he died intestate on July 20, 1950. On July 31, 1950, W. C. Owens conveyed to his brother, A. J. Owens, his entire right, title and interest in his father’s estate.

On November 9, 1951, W. C. Owens filed a bill in the Circuit Court of Russell County specifically alleging “that the said mentioned deed of conveyance, although appearing to be absolute on its face, was not intended to be such by your complainant and the said A. J. Owens, but on the contrary thereof, it was expressly understood and agreed between your complainant and the said A. J. Owens that the said title to said properties and effects were to be held by the said A. J. Owens as a security for the * * * $5,000 which * * * A. J. Owens had agreed to obligate himself for as surety for your complainant. * * *”

Thus a parol trust was alleged in the bill.

Continuing, the bill stated that A. J. Owens had received ample funds from complainant’s share of the estate with which to repay the $5,000 due him by complainant. The bill’s prayer for specific relief was that, for the reasons assigned, “A. J. Owens be compelled to reconvey the said lands and interest in lands to your complainant by sufficient and proper deed of conveyance in fee”, and to account for the personal property. The bill concluded with a prayer for general relief.

Thus A. J. Owens was informed only that W. C. Owens contended that the deed, although absolute on its face, was in truth and in fact, a trust executed for his (A. J. Owens’) protection.

Prof. Lile, in his work on equity pleading (Lile’s Equity Pleading and Practice (Meade), Third Ed., § 100, p. 61) outlines the purpose of the bill in equity as follows: “The purpose of the bill is two-fold: (1) To state the plaintiff’s case for the information of the defendant in the preparation of his defense; and (2) for the information of the court in the trial of the cause, and to fix the issues. The defendant is supposed to note the plaintiff’s grievances only from his statement of them in the bill, and it is to the precise case thus stated, and to that case only, that the defendant can be required to answer; and to the case so made the evidence must be confined; and no relief will be granted that does not substantially accord with the case as made in the bill. Hence the importance of accurate knowledge, by counsel, of the facts of his case, and the law applicable thereto, before he undertakes to present his case in the form of the bill.” (Italics those of the author) This statement is in accord with the general rule.

“* * * It is necessary, * * * for bills in equity to have such a degree of certainty that defendant may be distinctly informed of the nature of the claim made against him and of what he is called on to answer. * * *” (Italics supplied) 30 C. J. S., Equity, § 218, pp. 673, 674.

A. J. Owens, as demanded in the bill, filed his answer to the allegation made therein. He denied the allegation and specifically averred “that the said mentioned deed of conveyance was absolute on its face and was so intended to be such by your respondent and the said W. C. Owens, and was executed for the purpose of transferring legal title of the complainant in and to the said property to your respondent in fee simple; * * * On the single issue thus joined, A. J. Owens called for strict proof.

The complainant, in an effort to carry the burden of his allegation, testified that he knew his interest in his father’s estate amounted to “far in excess of $30,000”, and that under no circumstances would he have sold his interest for $5,000; that he was in debt and that judgments had been lodged against him; that he arranged with respondent to stand surety for a sum sufficient to pay off this indebtedness; that his brother complied with the request, and that the deed was executed for the sole purpose of saving his brother harmless.

On cross-examination he was asked if he did not understand the deed before he signed it, to which he replied:

“A. I can’t say that I did or I didn’t. I won’t say that I did. Mr. Duff read it to me.

“Q. You did understand it when he read it?

“A. I did. Mr. Duff read the deed and I won’t state that I did or didn’t.

“Q. But you did understand the meaning of the deed when it was read?

“A. I knew it was the deed.

“Q- There is nothing in this deed which provides that he is to reconvey any amount of property to you at all, is there?

“A. No, sir.

“Q. Did you explain to Mr. Duff ■ your understanding with Mr. A. J. Owens?

“A. No, sir.

“Q. Why didn’t you?

“A. There was no occasion to.

“Q. If you were only attempting to put a mortgage on your interest to secure the payment of some of your indebtedness, why didn’t you explain to the attorney who prepared the deed that that was your intention?

“A. It wasn’t any — the only thing we asked Mr. Duff to do was to make the deed. That is, we- didn’t explain to him our agreement or the agreement in which we had entered into. That wasn’t brought into it at all with Mr. Duff. All we asked Mr. Duff to do was to write the deed.

“Q. You did tell Mr. Duff the consideration was $5,000.00 cash, did you not?

“A. I did.”

This was the extent of complainant’s relevant evidence on the issue joined.

To refute complainant’s contention, the respondent introduced his mother who testified that she heard complainant tell the attorney that he wanted the deed prepared conveying his interest to his brother, and that after the deed had been recorded and they had returned home she asked complainant if he was satisfied with the deal, to which he replied, “Yes, mother, I am satisfied. I am well satisfied.”

Respondent also introduced J. E. Duff, the attorney, who testified that complainant had asked him to write the deed conveying his interest in his father’s estate to his brother, telling him that he had sold the same for $5,000, and that he intended to pay his debts and get out of Virginia. Duff stated that W. C. Owens fully understood the deed before signing it and that it was an outright sale.

He further testified that he paid off the judgment debts which included the notes on which complainant had been indicted; that he secured from the Commonwealth’s attorney a promise to nolle pros the indictments; that he questioned complainant as to his marital status and was told that he was unmarried, and the deed was prepared accordingly.

A. J. Owens testified that after his father’s death his brother came home from Indiana; that he had been away from Virginia since 1940; that when he left Virginia there were several indictments pending against him charging that he had forged his father’s name to notes'aggregating $1200; that when he left Virginia he left his wife and two children in Russell County and later obtained a divorce; that he learned after the .recordation of the deed that complainant had married his present wife in May, 1943; that immediately upon his return to Virginia complainant asked respondent what could be done about the indictments and judgments pending against him; that respondent consulted Mr. Duff at the request of complainant; that the attorney informed him that it would require at least $3,000 to clear the judgments; that on July 28, 1950, respondent endorsed complainant’s note for $3,000 and negotiated it at the bank; that complainant delivered the proceeds of the note to Mr. Duff who applied it to complainant’s indebtedness; and that Duff secured an agreement whereby the indictments would be nolle prossed.

Respondent further testified that after he had arranged for the payment of complainant’s debts and had secured the promise that the indictments would be nolle prossed he requested complainant to remain in Virginia in order that they might operate the farm jointly; that complainant’s response to this request was: “Jennings, I wouldn’t stay around here among the-people here at all and be sneered at and flouted around by them. I have got a good job and I am going back to it, and I would love to sell my interest in it (the estate)”; that he offered to sell him his interest for $5,000 and he accepted the offer; that he obtained the sum of $2,000 by a further loan and paid it to complainant who used a part of it to complete the payment of his obligations; that the $3,000 note of complainant’s was assumed and paid by respondent, and that this sum, plus the $2,000, constituted the $5,000 consideration mentioned in the deed.

Respondent testified that he purchased his brother’s interest outright and at the price named by complainant; that at no time was there any mention of the trust agreement as alleged. He further testified that after the deed had been recorded complainant returned to Indiana, and while he made several visits back to Virginia, he did not mention the transaction until October, 1951, at which time he presented respondent an unsigned note dated August 1, 1950, in the amount of $14,730, which complainant then claimed to be the balance due him for his interest in the estate. He requested respondent to sign the note, which request was refused.

It will be observed that the note for $14,730, plus the $5,000 consideration in the deed, placed complainant’s valuation on his share in the estate, both real and personal, at $19,730.

In addition to the related evidence, five prominent citizens testified to the good character of respondent and to his good reputation for truth and veracity.

This was the case presented on the pleadings, and the related testimony was the only evidence submitted relevant to the issue made.

In order to establish a parol trust in Virginia, “the declaration must be unequivocal and explicit and must be established by clear and convincing proof.” Minor on Real Property, (Ribble), Second Ed., Volume II, § 1192, p. 1592; Brame v. Read, 136 Va. 219, 118 S. E. 117. Complainant having failed to carry the burden imposed, the chancellor properly dismissed the bill.

“An allegation in a bill of a material matter and a direct denial of that allegation in the plea or answer, frame an issue of fact. * * * If the defense introduced by a plea (or answer) is good in law the only issue in the case is the truth of the plea.” (Italics supplied) 30 C. J. S., Equity, § 438, p. 844.

Sensing his failure to carry the burden of proof on the issue joined, complainant completely abandoned the case made by the pleadings and sought to prove the value of the estate, the inequity of the transaction, the trust relationship presumably existing between the parties, and that complainant was under duress by virtue of the pending indictments, all of which he presently contended enabled respondent to drive an unconscionable bargain with him. Such evidence, not being responsive to the issue joined, was objected to by respondent as “wholly irrelevant, immaterial and inadmissible”.

The majority opinion says: “Had the defendant objected in the trial court that plaintiff’s evidence did not conform to the allegations of the bill he could have compelled the plaintiff to allege with more exactness the grounds of his claim. This the defendant did not do, but elected to meet the plaintiff on the evidence introduced; and he stated in his brief: ‘The sole question at issue is whether the sale by the appellant to the appellee was induced by fraud, either actual or constructive.’ Therefore he can not now complain if the evidence in this equitable proceeding shows that the relief prayed should be granted.”

The record in the case does not show that the respondent “elected to meet the plaintiff on the evidence introduced”. On the contrary, it does show that the respondent repeatedly objected to evidence not relevant to the issue made by the pleadings. He could do no more. Certainly the sole issue attempted to be presented on the appeal by complainant was the constructive fraud case — but this was not the case made in the trial court. Respondent urges in his brief that the “Attention of the Court is again directed to the fact that the allegations contained in the bill of complaint purport to assail the alleged deed on the ground that it was intended as a mere encumbrance, rather than a bona fide deed of bargain and sale. Apparently, this theory has been abandoned by the appellant * * * .”

The majority opinion continues: “Unlike most of the evidence in the case, this testimony was not only uncontradicted but counsel for the defendant made no effort to contradict it, merely objecting that such evidence of value was not ‘material to any issue in this cause, is wholly irrelevant, immaterial and inadmissible.’ ” (Italics supplied)

It was not incumbent upon the respondent to contradict complainant’s evidence on irrelevant matters. The value of the land and other irrelevant testimony as stressed in the objections, was not material to the issue and was “wholly irrelevant, immaterial and inadmissible.” It was impossible for respondent to make his position more plain.

The depositions in the case were taken before a notary public and not in open court. It is obvious from the record that the attorney for complainant took full advantage of this situation by the introduction of irrelevant testimony.

The opinion of the majority is based upon complainant’s “change of face”, that is, upon his contention, pointed up in his assignment of error, that the court should have held that the consideration of $5,000 received by complainant was “so grossly inadequate and unconscionable as to warrant the court in seizing upon the confidential relationship of the parties, the oppression of the vendor, the fraud and deceit in the failure of the vendee to disclose the extent and the value of the properties and effects being received by him, and the conditions existing making it certain that the parties did not deal on terms of equality”.

The assignment embraces the heart of the decision of the majority, and it presents a new case which the learned chancellor in the court below has never been called upon to decide.

The chancellor had no right to consider evidence at variance with the pleadings. Leffers v. Hayes, 64 N. E. (2d) 768, 327 Ill. App. 440; Colp v. First Baptist Church, Etc., 260 Ill. App. 269, affirmed 173 N. E. 67, 341 Ill. 73, 71 A. L. R. 106; Jones v. Costlow, 47 A. (2d) 259, 354 Pa. 245; Medlinsky v. Premium Cut Beef Co., 57 N. E. (2d) 31, 317 Mass. 25; Steinberg v. New York Life Ins. Co. 188 N. E. 152, 263 N. Y. 45.

“The very object of pleadings requires that the parties be confined to the matters contained therein, and therefore no evidence will be considered except that relating to matters alleged in the bill or answer and in issue.” (Italics supplied) 30 C. J. S., Equity, § 444, p. 847; Andrews v. Drake, C. C. A. Mich., 83 Fed. (2d) 767, Cert. denied 57 S. Ct. 35, 299 U. S. 572, 81 L. ed. 421.

“In accord with the rule governing at law, the proof in a suit in equity must conform or correspond to the pleadings, ¡for he must succeed, if at all, on the case made by the pleadings.” 30 C. J. S., Equity, § 445, p. 848.

Courts of equity are and should be liberal in permitting amendments to bills. Rule 2:12 provides: “* * * Leave to amend shall be liberally granted in furtherance of the ends of justice.” (Italics supplied) (But see Lile’s Equity Pleading and Practice, § 147, pp. 83, 84) No amendment was sought in this instarice and therefore the issue presented was circumscribed by the bill and answer as originally filed.

Evidently the majority undertakes to assume jurisdiction over the new case under the prayer for general relief. But such a prayer was never intended to embrace a case not contemplated by the bill.

“* * * (T)he court will not grant under the general prayer relief * * * which rests on grounds not asserted in the bill.” (Italics supplied) 19 Am. Jur., Equity, § 227, pp. 181, 182; Williams v. Jackson, 107 U. S. 478, 27 L. ed. 529, 2 S. Ct. 814; English v. Foxall, 2 Pet. (U. S.) 595, 7 L. ed. 531; Vila v. Grand Island, etc. Co., 68 Neb. 222, 94 N. W. 136, 97 N. W. 613, 63 L. R. A. 791, 110 Am. St. Rep. 400, 4 Ann. Cas. 59.

“Under the prayer for general relief, the court may grant any relief to which the material facts and circumstances put in issue by the bill, and sustained by the proofs, entitle the plaintiff. But such relief must be consistent with the case made.” Lile’s Equity Pleading and Practice, supra, § 118, p. 70, citing McGowan v. Parish (D. C.) 237 U. S. 285, 35 S. Ct. 543, 59 L. ed. 955; Hurt v. Jones, 75 Va. 341, 352; Woolfolk v. Graves, 113 Va. 182, 69 S. E. 1039, affirmed on rehearing 113 Va. 182, 73 S. E. 721.

In Hiern v. Mill, 13 Ves. R. 114 (cited in 1 Dan. Ch. Prac. 380) Lord Eldon said: “The rule is that if the bill contains charges, putting facts in issue that are material, the plaintiff is entitled to the relief which those facts will sustain, under the general prayer, but he cannot desert the specific relief prayed, and under .the general prayer ask specific relief of another description, unless the facts and circumstances charged by the bill will, consistently with the rules of court, maintain that relief.” (Italics supplied).

“The test of the relief to be granted is not the case proved, but the case stated in the bill upon which the issue is made up.” Hurt v. Jones, supra, 75 Va., at p. 353.

Again referring to Lile’s Equity Pleading and Practice, Chapter 1:

“Equity procedure may be better understood through a knowledge of the purpose, and a conviction of the necessity of fixed rules and methods for all judicial proceedings. Judge Story has thus admirably expressed the function and operation of these rules in his classic treatise on Equity Pleadings:

' “ ‘It is obvious that in every system of jurisprudence professing to provide for the due administration of public justice, some forms of proceeding must be established to bring the matters in controversy between the parties who are interested therein before the tribunal by which they are to be adjudicated. And for the sake of the dispatch of business, as well as for its due arrangement with reference to the rights and conveniences of all the suitors, many regulations must be adopted to induce certainty, order, accuracy and uniformity in these proceedings. * * '*

“ 'Indeed, * * * there are many rules altogether founded in artificial reasoning, but which nevertheless may be affirmed, with few exceptions, to be greatly promotive of public justice and subservient to private convenience. If, here and there, any of them work an apparent hardship or mischief, it will, on close examination, be found that they also accomplish much general permanent good; and in this respect they partake only of the infirmity of all general rules, which must, in particular cases, give rise to some inequalities and shut out some individual equities and rights.’ ” (Story’s Eq. Pleading, §§ 1, 2.)

Paraphrasing Judge Burks’ opinion in Hurt v. Jones, supra, (75 Va., at p. 351), there is not in the whole bill, from the beginning to the end, the remotest allusion to or the faintest intimation of a fiduciary relationship existing between the parties, and nowhere is it suggested or intimated that the deed should be revoked on the ground of constructive fraud thus sought to be established. The sole issue raised by the pleadings was whether the deed as executed by W. C. Owens was security to save respondent harmless as alleged by complainant, or an absolute deed as claimed by respondent.

Extending to complainant all the indulgences which the most liberal rules of practice of this day would warrant, it is impossible, without a total disregard of the plainest and most essential principles of pleading, to grant him the special relief presently requested, based on the reasons now assigned. This is true, even though the complainant might be entitled to such relief in a proper case, on which we express no opinion, as such a case has never- been developed nor decided in the court below.

“No court can base its decree upon facts not alleged, nor render its judgment upon a right, however meritorious, which has not been pleaded and claimed.” Potts v. Mathieson Alkali Works, 165 Va. 196, 207, 181 S. E. 521, 525; Patterson v. Anderson, 194 Va. 557, 569, 74 S. E. (2d) 195, 203.

The decision of the majority is based upon an untried case involving a type of constructive fraud which was never pleaded but presumably practiced upon the complainant by respondent. The bill nowhere alleges such fraud, and “since fraud is never presumed in equity it must be distinctly and specifically charged in a bill seeking relief on that ground.” (Italics supplied) 30 C. J. S., Equity, § 225, p. 677.

I see no necessity for going into the merits of the case considered in the majority opinion. We have no right to .surmise as to how this constructive fraud case would have developed had complainant properly alleged such in his bill. We have no means of knowing how respondent would have answered such an allegation if properly pleaded, nor do we know how the proof on the issue thus made would have developed. Suffice it to say that no such case was presented to the chancellor in the court below and, as I conceive our duty, it is beyond our province to construct and decide it here.

We said in Liverpool, Etc. Ins. Co. v. Bolling, 176 Va. 182, 194, 10 S. E. (2d) 518, 523: “This is an appellate court, and on appeal we hear cases upon the theory upon which they were tried in the court below. The case there made is the case we hear on appeal.”

Chief Justice Marshall said in Marbury v. Madison, 1 Cranch 137, 175: “It is the essential criterion of appellate jurisdiction, that it revises and corrects the proceedings in a cause already instituted, and does not create that cause. * * *” (Italics supplied)

Judge Buchanan, in Warren v. Warren, 93 Va. 73, 74, 24 S. E. 913, said:

“The parties must stand or fall upon the case as made in that (the trial) court. An appellate court is not a forum in which to make a new case. It is merely a court of review to determine whether or not the rulings and judgment of the court below upon the case as made there were correct. Any other rule, it has been well said, would overturn all just conceptions of appellate procedure in cases at law, and would result in making an appeal .in such action a trial de novo, without * * * the means of correcting errors and omissions.” (Italics supplied) See also Jackson v. C. & O. R. Co., 179 Va. 642, 651, 20 S. E. (2d) 489, 493.

The concurring opinion filed, in an effort to extricate the majority from its rather hapless position, also attempts to ignore the case submitted in the trial court. This opinion concurs with the majority in the admission that the case there tried utterly failed. But the concurring opinion asserts: “As I read the record, both parties clearly understood the issue upon which the case had been heard and decided in the lower court and what issue was to be determined on appeal.” Such a conclusion is untenable in the face of this record.

A. J. Owens, the respondent, had vigorously protested and objected to the admission of the irrelevant evidence introduced before the notary and he did not attempt to controvert same for the reason that it was irrelevant and immaterial to the issue joined. This is conceded in the majority opinion.

Furthermore, in his brief filed with us, respondent repeatedly calls our attention to the fact that W. C. Owens has abandoned the case alleged in the bill and is thus attempting to try a new case on appeal.

The majority opinion is critical of respondent for not meeting the irrelevant evidence taken before the notary and the concurring opinion now seeks to condemn him for asserting in his brief that he has not defrauded his brother.

Both opinions seek to place a “Halo of Equity” around the head of complainant. Such, I think, hardly fits the brow of this fugitive from justice who nowhere attempts to deny that he deliberately attempted to perpetrate a fraud upon respondent when he conveyed the property to him under the representation that he was unmarried, thus leaving the same subject to his wife’s dower interest. The majority nowhere undertakes to wash his “unclean hands.”

Upon the record made I feel that the chancellor was powerless to do other than dismiss the bill.

.Hudgins, C.J., and Spratuey, J., join in this dissent.