DocketNumber: C115274CV; A153464
Citation Numbers: 271 Or. App. 647, 352 P.3d 737
Judges: Edmonds, Haselton, Lagesen
Filed Date: 6/10/2015
Status: Precedential
Modified Date: 9/9/2022
This case arises out of a family dispute regarding the parties’ deceased mother’s intent in deeding an interest in her house to her son (defendant). The trial court found that, in conveying the interest in the house to defendant, the parties’ mother intended defendant to hold the property in trust for the beneficiaries of her will, including her daughter (plaintiff) and defendant. Based on that finding, the trial court entered a judgment that, among other things, declared that defendant held the house as trustee of a resulting trust for the benefit of the beneficiaries of the parties’ mother’s will.
Plaintiff and defendant are sister and brother. After their father died in 2002, plaintiff and the parties’ mother, Joan, had numerous conversations about Joan’s estate, including the family home and Joan’s bank accounts.
In September 2005, Joan executed a bargain-and-sale deed, conveying, as grantor, “Lot 55, EMERALD ESTATES, No. 2, Washington County, State of Oregon” to herself and defendant, as grantees. On the title company’s “Application for Exemption from Washington County Transfer Tax” form, under the “Required Information” heading, Joan completed the section under the subheading “If transfer is a Gift” (rather than the section under the subheading “If transfer is by devise or inheritance”). Both Joan and defendant signed that form, as well as a “Settlement Statement” that listed Joan and defendant as the “buyers.” The deed did not specify that Joan and defendant would hold the property jointly with a right of survivorship. Plaintiff was not present when the deed was executed, although Joan later told her that she had put defendant on the title to the house and on Joan’s bank accounts.
Joan died in October 2008. Because the bargain- and-sale deed did not state that the 2005 conveyance to defendant had been with a right of survivorship, upon Joan’s death, the deed, as written, had the effect of transferring a one-half undivided interest in the residence to Joan’s estate, subject to probate, and a one-half undivided interest to defendant not subject to probate, although Joan’s intention in putting defendant on the deed to the house had been to avoid probate.
Upon Joan’s death, defendant initially behaved as if he held the house in trust for the beneficiaries of Joan’s
Initially, defendant consented to those conditions. In early July, when defendant was starting to move in, plaintiff sent him the lease agreement. Defendant did not, however, sign the lease at that time. By late July or early August, plaintiff had calculated an appropriate rental amount for defendant: $750 per month, half of the market rental value of the house, given the minor repairs and maintenance that defendant would continue to undertake. Defendant did not, either then or at any point thereafter, tender a rent payment to the estate. The estate continued to pay both the home insurance and property taxes.
Around that time, plaintiff and defendant had their first conversation about the possibility of defendant purchasing the house from the estate. Defendant expressed anger at the prospect that he would need to mortgage the property in order to purchase it in full from the estate. In late fall of 2009, defendant began to assert that Joan had conveyed the house to him as a gift and had not intended for defendant to hold the property in trust for the other beneficiaries of Joan’s will.
After defendant began to claim that Joan had given him the property outright and to disclaim that he held the property in trust for the benefit of Joan’s beneficiaries, plaintiff, acting in her capacity as personal representative of her mother’s estate, initiated this action for declaratory relief, seeking a declaration that defendant holds title to the home in a resulting trust for the benefit of himself, plaintiff,
At trial, the parties agreed that Joan had transferred the property to defendant with the objective of avoiding probate and that the deed’s omission of a specification that defendant’s interest in the property was with “right of survivorship” was a mistake that needed to be corrected through reformation of the deed. They disagreed, however, with respect to whether Joan intended to give the property to defendant outright or, instead, had transferred the property to him to hold in trust for the beneficiaries of her will. The trial court ultimately found that (1) Joan had intended that defendant’s interest in the property would be with right of survivorship, and the deed mistakenly failed to specify that defendant held the property with right of survivorship; and (2) in transferring the property to defendant, Joan had not intended to give it to defendant but, instead, had intended for defendant to hold it in trust for the beneficiaries of her will. In making those findings, the trial court resolved conflicts in the testimony about Joan’s intent by making express credibility findings; it credited plaintiffs testimony but did not find defendant to be a credible witness.
On appeal, defendant challenges the trial court’s factual finding that, in deeding an interest in her home to defendant, Joan intended that defendant would hold the property in trust for the benefit of the beneficiaries of her will. He contends both that the trial court erred in admitting extrinsic evidence of Joan’s intent in executing the deed to defendant and herself and, in particular, that our decision in Connall v. Felton, 225 Or App 266, 201 P3d 219, rev den, 346 Or 257 (2009), precluded the trial court from considering evidence of defendant’s conduct subsequent to the execution of the deed in assessing whether defendant held the property as the trustee of a resulting trust. Defendant also argues that the evidence in the record — even if that evidence was properly admitted — is insufficient to support the trial court’s factual finding that Joan did not intend to give the property to defendant but, instead, had transferred it to him to hold in trust for the beneficiaries of her will. Defendant further requests that we engage in de novo review of the trial court’s factual finding that, in conveying an interest in her house to defendant, Joan intended for defendant to hold that interest in trust.
As an initial matter, we decline to exercise our discretion to engage in de novo review; this is not an exceptional case, and the trial court’s express credibility findings based on live testimony militate against such review. ORAP 5.40(8)(d)(i); Frontgate Properties, LLC v. Bennett, 261 Or App 810, 812 n 2, 324 P3d 483, rev den, 356 Or 400 (2014). Accordingly, we review the trial court’s factual findings to determine whether there is any evidence in the record to support them, and we review for legal error the court’s legal conclusion that it could consider evidence extrinsic to the deed, including evidence of defendant’s conduct subsequent to the execution of the deed, in determining whether defendant held the property in a resulting trust. See Frontgate, 261 Or App at 812 (stating standards of review applicable, respectively, to trial court’s factual and legal determinations in equitable case in which we decline to review de novo).
We first address defendant’s argument that the trial court erred in considering evidence extrinsic to the deed in determining that Joan’s conveyance of her house to defendant gave rise to a resulting trust. Defendant asserts that our decision in Connall precluded the trial court from considering extrinsic evidence, including, in particular, evidence of defendant’s post-conveyance conduct, in determining whether Joan had transferred the house to him for the benefit of the beneficiaries of her will. We disagree.
In this case, unlike in Connall, both parties agreed (and the evidence indicates) that the deed did not fully reflect Joan’s intentions in conveying an interest in the property to defendant. Moreover, in this case, unlike in Connall, defendant himself invoked the court’s equitable jurisdiction, requesting that the court reform the deed to reflect what defendant claimed to be Joan’s true intention: that the whole house (rather than just a half-interest in the house) would pass to defendant upon Joan’s death. Under those circumstances, where both parties invoked the court’s equitable jurisdiction, and both parties agreed that the deed did not fully reflect Joan’s intent, but disagreed as to what that intent was, the trial court permissibly considered all relevant extrinsic evidence of Joan’s intent in making the conveyance in order to ascertain what, in fact, that intent
We next address defendant’s argument that the evidence was insufficient to support the trial court’s factual finding that, in executing the deed to defendant, Joan did not intend to give the property to defendant but, instead, intended to convey the property to defendant to distribute to the beneficiaries of her will after her death. We conclude that the evidence in the record — taking into account the trial court’s determinations that defendant and his supporting witnesses were not credible in their testimony — was sufficient to permit the trial court to find that it was highly probable that Joan intended to convey the property to defendant for him to distribute to the beneficiaries of her will upon her death.
Plaintiff testified that she and Joan had multiple conversations about putting one of Joan’s children on the title to the house and the bank accounts in order to be able to transfer that property to Joan’s heirs without going through the probate process; that Joan had originally suggested putting plaintiff on the title of the house and the bank
Affirmed.
The beneficiaries of the will were plaintiff, defendant, and two grandchildren.
Plaintiff cross-assigns error to the trial court’s exclusion of certain evidence; our rejection of defendant’s assignments of error obviates the need to address that cross-assignment.
After Joan passed away, defendant used his mother’s bank account to pay, in addition to Joan’s hospital bills, the utility bills, maintenance expenses, and property taxes, and he apportioned the remaining account proceeds consistent with Joan’s will.
The court also expressly found that defendant’s wife and the parties’ brother, both of whom testified that Joan had wanted to give the house to defendant, were not credible witnesses.