Maxfield v. Sainsbury

This is an appeal from a decree by the District Court of Salt Lake County ordering specific performance of a real estate contract.

On the 11th day of August 1935, Charles Evans, deceased, entered into an agreement with the respondents, E.R. Maxfield and Lavera B. Maxfield, hereinafter called the purchasers, for the sale of property, farm implements, tools and water stock. The consideration for the sale was $5,000 and the maintenance, support and medical care of the deceased throughout his life. The terms for payment of the $5,000 were as follows: $15 on the first day of September, 1935, and $15 payable the first day of each month thereafter with the exception of the months of December when the purchasers were to pay $160. This method of payment was to remain in effect until the entire purchase price was paid. It was further agreed that the purchasers could make larger payments or pay the entire amount if they desired. Immediately upon execution of the agreement the deceased signed written instructions to the purchasers to make all payments to his son, Evan George Evans. Four days later, August 15, 1935, the deceased and the purchasers entered into an escrow agreement whereby the irrigation stock was placed in the Sandy Bank with instructions to deliver said stock to the purchasers upon payment of the consideration named in the agreement. Two additional instruments were executed on August 15, 1935, the first one being the granting to Evan George Evans power of attorney with all right and power to manage and control the deceased's real and personal property. The second, which is the cause of this law suit, is the following receipt alleged to have been issued to the purchasers by the deceased:

"August 15, 1935

"Receipt is hereby acknowledged for the sum of ($3000.00) Three Thousand Dollars from E.R. Maxfield Lavera B. Maxfield to apply on contract dated August 11, 1935, to purchase 16 acres of land as described in contract and is situated in So. 1/2 of So. E 1/4 of section 30, Salt Lake County, Utah.

"The acknowledgment was received as follows one dollar in cash, canal water stock returned, tools and delivered other valuable consideration.

"/s/ Charles Evans"

During the years 1934, 1935, 1936 and 1937, the purchasers failed to pay the yearly December installments of $160 as provided by the terms of the agreement. Evan George Evans at the purchasers' request deferred payment of all sums which became delinquent to the end of the agreement. In 1940 the purchasers again were delinquent, and on March 30th Evan George Evans waived all past defaults.

The seller, Charles Evans, died testate on the 26th day of December, 1943. Evan George Evans became executor of his will. On February 23, 1944, the purchasers commenced this action against the executor and all persons who would take the estate under the will or the laws of succession, for specific performance of the contract of purchase and sale, to compel the execution and delivery to the purchasers of a deed of conveyance of the land. The defendant in the suit hereinafter called the executor, resisted the action on the ground that there was still $3,000 unpaid and untendered on the sale price. The only substantial dispute in the evidence is the validity of the $3,000 receipt which poses the principal issue in this suit.

Is the $3,000 receipt a valid one?

The purchasers called the following witnesses to substantiate the validity of this receipt: Reed R. Maxfield, P.W. Schlotz, Jessie Kemp, Robert B. Maxfield, William Cloris Keysor and Sarah Keysor Kemp. Objection was made to the testimony of Sarah Keysor Kemp on the ground she was incompetent as a witness under the provision of Sec. 104-49-2, U.C.A. 1943, commonly called the "dead man statute." It was stipulated that Sarah Keysor Kemp is the granddaughter of Charles Evans, the deceased, and was named in the will of the deceased as a legatee and was to receive one-fifth of the one-ninth interest of her mother, Florence M. Evans Keysor, the deceased daughter of Charles Evans. She was named as one of the defendants in the complaint filed in this action. Over the objections of the executor that this witness was disqualified to testify by reason of Sec. 104-49-2, U.C.A. 1943, the court permitted her to testify and relate conversations with her deceased grandfather, Charles Evans.

This gives rise to the principal legal question of this case: Is this witness disqualified under subdivision (3) of Section 104-49-2, which reads as follows:

"The following persons cannot be witnesses:

* * * * * * "(3) A party to any civil action, suit or proceeding, and any person directly interested in the event thereof, and any person from, through or under whom such party or interested person derives his interest or title or any part thereof, when the adverse party in such action, suit or proceeding claims or opposes, sues, or defends, as guardian of an insane or incompetent person, or as the executor or administrator, heir, legatee or devisee of any deceased person, or as guardian, assignee or grantee, directly or remotely, of such heir, legatee or devisee, as to any statement by, or transaction with, such deceased, insane or incompetent person, or matter of fact whatever, which must have been equally within the knowledge of both the witness and such insane, incompetent or deceased person, unless such witness is called to testify thereto by such adverse party so claiming or opposing, suing or defending, in such action, suit or proceeding."

For the purpose of clarification we shall eliminate the parts of the statute which do not have a bearing on our question. It then reads:

"The following persons cannot be witnesses:

* * * * * * "(3) A party to any civil action * * * and any person directly interested in the event thereof * * * when the adverse party in such action * * * claims or opposes, sues or defends * * * as the executor * * * of any deceased person, * * * as to any statement by * * * such deceased * * * person * * * which must have been equally within the knowledge of both the witness and such * * * deceased person unless * * * called to testify thereto by [the executor]."

This section of the statute has been before this court a number of times, and similar sections have been before a number of courts. The cases, like the language of the statute, are not entirely free from confusion. The confusion vanishes when a careful analysis is made of the intent and 1 purpose of the statute. The purpose of the statute is to guard against the temptation to give false testimony in regard to a transaction with a deceased person by the surviving party, when the transaction is involved in a lawsuit and death has sealed the mouth of the other party. Furthermore, the statute seeks to put the two parties upon terms of equality in regard to giving evidence of the transaction. 3 Jones Ev. 790; Miller v.Livingstone, 31 Utah 415, 88 P. 338. It was never intended that this section should be used for the purpose of suppressing the truth. On the contrary, the statute's sole purpose is to prevent the proving by false testimony of claims against the estate of a deceased person. With this intent and purpose in mind we will now apply the statute to the facts of this case. The statute involved has an awkward construction, because it is merely a subdivision of a section enumerating who may not be witnesses, and therefore each subdivision begins by naming a party who cannot be a witness and then attempts to state the qualifying conditions. Let us restate or paraphrase subdivision (3) to express the same thought without attempting to make it fit in the "form mould" of the rest of the section. The thought would then be expressed thus:

When an executor, etc., sues or defends in an action to protect or recover assets of the estate, neither the other party to the action, nor the person through whom he claims or deraigns his title, nor any other person having a direct interest in the claim of the party opposing the executor, etc., that is, an interest in the cause of action, adverse to the claims of the executor, can testify as to any transaction had with the deceased, which is involved in the lawsuit, nor as to any statement made by the deceased relative to the transactions, matters and claims involved in the lawsuit, unless such person is called to so testify by the executor, etc.

This section makes incompetent: (1) A witness who is a party to the action; (2) a person directly interested in the event of the instant suit; when the adverse party claims, opposes, sues or defends as the executor, administrator, guardian, heir, legatee or devisee. It follows the executor is the 2 adverse party to this action. A glance at the caption reveals that Sara Keysor Kemp is joined as a party defendant with the executor Evan George Evans. Does this fact make her a party to the action and thereby disqualify her from testifying? The prohibition of this statute, by its express wording, is limited to parties whether plaintiff or defendant, who are opposing or suing the executor in the immediate action, that is to those who are the parties in the suit adverse to the executor. Sarah Keysor Kemp is not opposing or suing the executor but, on the contrary, is defending with him; she is not an adverse party to him, nor is he an adverse party to her. Her interest in the suit is favorable and identical with that of the executor. To extend this statutory disqualification to include a party not suing or opposing the executor and particularly to one whose position in the action is favorable and identical with that of the executor would be to totally disregard the wording of the statute and its past application by this court. Mower v. Mower, 64 Utah 260,228 P. 911; Miller v. Livingstone, 31 Utah 415, 88 P. 338;Clark v. Clark, 74 Utah 290, 279 P. 502. She is not incompetent on the ground that she is a party.

Sarah Keysor Kemp is an heir of the deceased and should the executor prevail she will inherit a one-fifth of a one-ninth interest in the property in issue. Does this interest disqualify her as a person interested in the event of the suit? The executor insists that a person directly interested 3, 4 in the even of the suit is disqualified and it makes no difference whether that interest is in the cause of action or in the estate. We reject this contention. The statute extends this disqualification to the witness and not to the testimony.Grieve v. Howard, 54 Utah 225, 180 P. 423. The court does not permit the witness to testify before determining the admissibility of the evidence. The witness and his interests are considered, if timely objection is made, at the time the witness takes the stand. If the witness is opposing or suing the executor or, if the witness has a direct interest in the event of the suit the prohibition of the statute applies. To hold contra would result in the disqualification of every person who has had conversation with the deceased and who might derive some benefit from the estate, either as an heir, devisee, legatee, creditor or cestui que trust. If the legislature had intended interest in the estate was to disqualify they would have simply said:

"In any suit where the executor is a party thereto all persons interested in the estate are disqualified from testifying as to conversation with the deceased."

Such a construction was not intended and to so hold would be to disregard the term "adverse party." We think the legislature intended by the term "adverse party" to disqualify only those witnesses who have a direct interest in the event of that particular action adverse to the interests of the estate. SeeMower v. Mower, 64 Utah 260, 228 P. 911, where this court dealt with a situation similar to that presented here in this respect: If the deed, which was the subject matter in that suit, was found to be valid the heirs received nothing. The heirs were called by the defendant who was opposing the administrator. The court held that the express terms of the statute did not exclude these witnesses for they were not interested parties as set forth in the statute; their interest was in the estate, and not in the claim urged against it.

Other Utah cases which hold that the disqualification extends only to those suing or opposing the executor or administrator and to witnesses whose interests are in the claim urged against the estate are: Miller v. Livingstone, 31 Utah 415, 88 P. 338;Staats v. Staats, 63 Utah 470, 226 P. 677; Clark v.Clark, supra. In the Livingstone case the daughters of the testator were called by the plaintiff; defendants interposed the dead man statute. The court in reversing the holding held [31 Utah 415, 88 P. 344]:

"The purpose of these statutes is to guard against the temptation to give false testimony. * * * The statute in this regard is intended to protect the estates of deceased persons from assaults, ``and relates to proceedings wherein the decision sought by the party so testifying would tend to reduce or impair the estate, and does not relate to the relative rights of the heirs or devisees as to the distribution of an estate in a proceeding by which the estate itself is in no event to be reduced or impaired."

In other words, the interest of the witness must be in the claim urged adversely to the estate. In Staats v. Staats, supra [63 Utah 470, 226 P. 680], the testator's son, who was also the surviving partner, sued his mother and intervening brothers. This court in permitting the plaintiff and other heirs to testify concerning transactions with the deceased said:

"In view, therefore, that she is here claiming in her own right, the other heirs are competent witnesses. * * * That the statute has no application where the controversy arises between or among the heirs and merely involves questions relating to their respective rights as such, and, where there is no assault upon the estate."

The converse of the above cases is Clark v. Clark, supra, in which the prohibition of the statute was applied against plaintiff who was adverse as a party and adverse in interest. Plaintiff was the son of the deceased. He was suing the estate and his older brother, who was the executor, for specific performance of a contract for the purchase of a house and lot which he claimed his deceased father contracted to convey to him in return for taking care of the deceased and his wife. The plaintiff was properly disqualified.

Rasmussen v. Sevier Valley Canal Co., 40 Utah 371,121 P. 741, 745, is the case in which this court held that an adverse interest in the event of the specific action is the interest which disqualifies a witness. The pertinent facts are: The administrator was suing a corporation for wrongfully transferring stock belonging to the deceased. H.W. Ramlose, who now claimed and held the stock though not a party to the suit, offered to testify as to how he became the owner of the stock. In ruling the court said:

"The mere fact that Ramlose was not a party to the action is, under the circumstances, no reason why he was not interested in the event thereof. Under the statute, Ramlose would be incompetent to testify to any fact which was equally within his knowledge and that of the decedent, unless he were called on behalf of the administrator. All of the facts concerning which Ramlose sought to testify were equally within the knowledge of himself and that of the decedent. His testimony was therefore properly excluded."

The mere fact that the matter to which the witness is to testify is equally within the knowledge of the witness and deceased does not disqualify the witness. It must pertain to the transaction with the deceased involved in the lawsuit, or to a statement made by deceased with reference to 5 that transaction, and be equally within the knowledge of both. For a very scholarly discussion of the so-called "dead man" statute giving the term "adverse interest" a wider range of exclusion than that allowed in this opinion, see article written by Mr. Justice Wolfe in 13 Rocky Mountain Law Review, 282 (June, 1941) which also appeared in the Utah Bar Bulletin, Volume 11, July-August, 1941, Nos. 7 and 8.

The law is unqualifiedly expressed if a witness is not a party adverse to the executor, administrator, guardian, heir, legatee or devisee in a suit wherein such executor seeks to protect or recover the estate's assets; and if he has not a direct interest in the event of that suit antagonistic to that 6 of the estate of the deceased, he is not disqualified by the statute. It is the interest in the claim which is adverse — not the adverse testimony that disqualifies him. The witness in this case is not an adverse party in this action, nor is her interest one in the claim adverse to the estate of the deceased. On the contrary, her personal interests are adverse to the claim of the purchaser and if she testifies in his behalf she would be testifying against her personal interests. Her testimony was properly admitted.

This is an action in equity in which it becomes our duty to determine questions of fact as well as questions of law, but unless the evidence clearly preponderates 7 against the findings and judgment by the district court, its decision will stand. Singleton v. Kelly, 61 Utah 277,212 P. 63; Clark v. Clark, supra.

An analysis of the facts as set out in the record convinced us that the evidence not only clearly preponderates against the findings and judgment of the district court but compels a different conclusion. The only evidence to support the finding that the deceased actually signed the receipt 8 in issue was the testimony of Reed Robert Maxfield, the son of the purchaser. He testified that twelve years before, when he was eleven years of age, he saw his grandfather sign the receipt. For reasons that are obvious from the record little credence can be given testimony of this character. The trial court gave considerable weight to the testimony of Robert Burns Maxfield, Sarah Keysor Kemp and Jessie Kemp, in which they testified that the deceased had told them at various times during his life that he had executed a receipt or agreement to the purchasers. We do not consider this evidence decisive for it is noticeable that that witnesses used the words receipt andagreement interchangeably throughout their testimony. Since the subject matter of the receipt and the agreement are similar it is more than a possibility — it is very probable — that the deceased was referring to the original agreement in the conversations with such witnesses.

It is noteworthy that the receipt, which purports to have been made only four days after the purchase contract, was, according to plaintiffs' witnesses, given inter alia to cover the keep (board and room) of the maker until his death, although the sale contract recites that he was to have his keep in addition to the $5,000 sale price, so if that contention be upheld, plaintiffs would receive credit twice on the sale price for decedent's keep.

Evidence which we consider decisive is the testimony of the children of the deceased and the expert testimony of J. Percy Goddard. Evan George Evans, son of the deceased, who had full and complete authority of management of all property of Charles Evans in life, and who was his executor after death, testified that the signature on the receipt was not the signature of the deceased. He further testified that no claim was ever made by the respondents of a payment of $3,000 during the life of the deceased; that during the period from August 11, 1933, to December 26, 1943, nothing was ever mentioned about the return of any water stock; that the purchasers never demanded any water stock; that purchasers never tendered to him or returned to him any water stock; that the purchasers never made any complaint concerning tools that were not delivered; that there was no entry of a $3,000 payment in the account book. The executor further testified the purchasers came to him in 1934, or the first part of 1935, and asked that delinquency of the payments be waived and nothing was said about having paid $3,000. The waiver was granted. In considering the genuineness of the signature we think the evidence impels the conclusion that the signature is not that of the deceased. Evan George Evans, Ann Jane Sainsbury, Earl D. Evans and Eldon Stephen Evans, children of the deceased, all testified that the signature on the receipt was not the signature of their father, Charles Evans. With the aid of the testimony of J. Percy Goddard, a handwriting expert of high repute, we are able to easily discover the distinction and differences between known signatures of the deceased and that of the signatures on the receipt. For example, the "C" in Charles of the questioned signature has a greater slant by several degrees than the letter "C" as appears in the proven standard signatures, particularly in relation to the slant of the letter "h" which is the second letter in the signature. This distinction becomes apparent by drawing lines along the slant of the "C" and the "h" until the two lines converge at the top. The lines of all signatures converge but the angle at the converging point of the questioned signature is 9 or 10 degrees greater than the converging point of the standard signatures. Throughout the signature it appears that the hand that wrote "Charles Evans" on the questioned document was more steady, more skilled and more smooth than the hand that wrote the standard signatures. For instance, the letter "l" is smoother than the "l's" appearing in the standard signatures. It should also be noticed that the letter "l" of the questioned signature reaches and slightly passes the letter "C"; in the standard group the "l" is a relative short letter. The marked differences between the three characters "es" and "E" not only reinforce and render certain that the signature on the receipt is not the signature of decedent but also dispose of the purchasers' claim. One can almost see at a glance that the two characters "es" occupy approximately 50% more horizontal space than do the characters of the standard signatures. The letter "E" is different in that we can turn it 45 degrees and we have a very clear letter "O"; there is no such character in the "E" of the standard writings.

The evidence clearly preponderates against the findings of the district court and the judgment must be reversed.

Judgment reversed. Cause remanded with directions to enter judgment for defendants, "no cause of action." Costs to appellant.

PRATT and WADE, JJ., concur.