Milner v. Freeman

Smith, J. This was a bill to have a resulting trust declared in lands which a husband had purchased and caused to be conveyed to his wife; it being alleged that it was understood and agreed at the time that she should hold only a life estate, and that upon her death the lands should revert to him. The Circuit Court denied the relief and dismissed the bill. The proofs disclose the following facts: — Milner, the plaintiff, in 1863, bought two lots, and again in 1869 two other lots, in the town of Searcy, for which he paid with his own means. The lots were unimproved, but Milner built a house upon them, in which he and his wife resided until her death. He was not indebted, but took the conveyances in his wife’s name upon the suggestion and advice of the vendor and under the mistaken impression that they would vest a title in, or operate for the joint use and benefit of both. Mrs. Milner died childless, her heirs at law being her brothers and sisters, who are made parties defendant. Milner continued to occupy the premises after his wife’s decease. Milner’s vendor was Israel M. Moore, an old friend and distant relative, in whom he and his wife had great confidence. The question in whose name the deeds should be taken was freely canvassed between the three, viz: Moore and the husband and wife. All supposed that, if Milner should outlive his wife, the lands would by law descend to him. Mrs. Milner remained under this conviction to the day of her death and frequently mentioned the matter to her friends. At the time the first deed was taken, Milner was in feeble health and did not expect to live long. They were an elderly couple and in humble circumstances, apparently owning no other property except that in controversy. Mrs. Milner had not inherited, nor otherwise obtained, any property of her own except a cow, a bed and bed clothing which her parents gave her. 'When a man buys an estate and takes the deed in name of a stranger, a trust results by operation of law him who advances the purchase money. If, however, nominal purchaser is a child or the wife of the person from whom the money comes, it is presumed to have been an advancement or a gift. But this presumption is not conclusive. It may be rebutted by antecedent or contemporaneous declarations and circumstances which tend to prove the intention of the person who furnished the money to buy the estate that the grantee should hold as a trustee and not beneficially for himself. This doctrine, with all of its limitations and nice distinctions, is discussed in Dyer v. Dyer, 2 Cox, 92, and in the notes to that case in White & Tudor’s Leading Cases in Equity, 4th American Ed., Vol. 1, Pt. 1, 314 et seq. It is urged in support of the decree below, that to engraft a trust upon these deeds is to permit their recitals to be contradicted. Yet nothing is more firmly established than that a resulting trust may be established by parol, notwithstanding the deed acknowledges the consideration to have been paid by the grantee. Lead. Cas. in Eq., 333; Boyd v. McLean, 1 John., Ch. 582; 1 Perry on Trusts, sec. 137; Hill on Trusts, 4th Amer. Ed., 165-6. The cestui que trust not being a party to the deed, is not estopped by its recitals or covenants to prove all the facts from which a trust may be inferred. Livermore v. Aldrich, 5 Cash., 431. Resulting trusts are specially excepted from the operation of the Statute oí frauds. Gantt’s Dig., sec. 2963. Nor does it make any difference that Mrs. Milner, the nominal purchaser and grantee in the deed, is dead. 1 Perry on Trusts, see. 138. It is further insisted that such a trust can not be set up t as between husband and wife. At Law a wife cannot be trustee for her husband, nor viee versa. But there has never been any difficulty on this head in Equity. In that Court husband and wife are treated as distinct persons and the reports are full of cases where one of them has been held as trustee for the other. For an instance, see Dyer v. Bean, 15 Ark., 519. A further objection was that the plaintiff did not pay the purchase-money at the time of purchase, lhe evidence con-r 1 x duced to show that he bargained for the lots before he paid for them; the payments not being completed until the deeds were made. This Court in Sale v. McLean, 29 Ark., 612, and in Duval v. Marshall, 30 Id., 230, said in effect that in order to create a trust of this nature, payment of the purchase money must be made at the time of the purchase. By this it was meant that the trust must arise, if at all, from the original transaction, at the time it takes place and at no other time; and that it cannot be mingled or confounded with any subsequent dealings. Some of the cases use the language, “at the date of the payment of the purchase money,” others, “at the time of the execution of the conveyance.” But all of them mean the same thing, namely: that it is impossible to raise a resulting trust so as to divest the legal estate of the grantee or his heirs, by the subsequent application of the funds of a third person to the satisfaction of the unpaid purchase money. Botsford v. Burr, 2 John., Ch. 406 ; Rogers v. Murray, 3 Paige, 390; Lead. Cases in Eq., supra, 338. The trust arises out of the circumstances that the money ^ the real piirchaser, and not of the grantee in the deed, formed the consideration of the purchase and became converted into land. Every case of this class ultimately turns upon the question whether it was the intention of the person who paid the money to confer the beneficial interest upon another or to secure a trust for himself. Perry on Trusts, sec. 151. In the present case the proof is satisfactory that Milner did not intend am absolute gift of the land to his wife. Hence results a trust which a Court of Chancery will execute in his favor. Oiir decision is not based upon Milner’s misapprehension of the legal operation of the deed. He and his wife evidently supposed that it would have the same effect as a deed to them jointly, and that the survivor would take the whole. And in Wallace v. Bowen, 2 C. L. Williams, (28 Vt.) 638, almost a duplicate of this case, and one which escaped the researches of the learned counsel who argued it, Chief Justice Redfield intimated that such being the mutual understanding, a Court of Equity would be justified in compelling the parties to allow it to have that operation. But it is a mere circumstance in evidence negativing Milner’s intention to make an absolute gift to Mrs. Milner, and disclosing his purpose to reserve an interest for himself. The decree below is reversed, and a decree will be entered here, divesting the legal estate in the premises out of the heirs at law of Mrs. Milner and vesting the same in the plaintiff.