Opinion
No. 3952.
March 6, 1951.
An owner of real estate held in common with another is not precluded by the fiduciary relationship doctrine from acquiring the interest of the other at a sale by the administrator of the latter's estate. Where a husband at the time of his decease owned an undivided one-third interest in real estate which was held in common with another owning the remaining two-thirds, the widow upon filing her release of dower and homestead became entitled by virtue of R. L., c. 359, s. 10 III to the entire one-third interest, due to the value of the property, to the exclusion of the former co-owner. Hence the tenancy in common as to the one-third interest ceased and the widow is barred from maintaining an action to impress a constructive trust, because of the fiduciary relationship, upon the one-third interest acquired by the former co-owner at the administrator's sale. A bill in equity to impress a constructive trust upon property acquired at an administrator's sale by one who formerly held it in common with the plaintiff's intestate is not an attack on the order or judgment of the Probate Court authorizing such sale. Where the Trial Court dismissed a bill in equity upon two independent grounds, each specifically ascertained, the erroneous ruling upon the one ground was not under the circumstances prejudicial to the judgment properly supported by the other.
BILL IN EQUITY, to establish a constructive trust because of a confidential and fiduciary relation and for an accounting. The plaintiff is the widow of Charles W. Colby who died intestate and without issue on June 22, 1942. At his decease the intestate owned an undivided one-third interest in a farm located in Hill and the defendant owned the other two-thirds. The administrator, Albert H. Barney, on December 14, 1943, was granted by the Probate Court a license to sell Charles' one-third interest. He conveyed it to the defendant for a stated consideration of $500. On October 24, 1944, his final account as administrator was allowed. The defendant sold the entire farm for the sum of $7,000 on December 1, 1944. The plaintiff filed a release of dower and homestead July 24, 1945.
The case was heard by the Court, who dismissed the bill. The material findings and rulings are as follows: "It appears that all the issues sought to be raised in this case can now be litigated in the Probate Court. The Court rules that the bill in equity is an attempt to collaterally attack the decree of the Probate Court. As was stated by the Court in Gordon v. Gordon, 55 N.H. 399, 401, `The attempt is to impeach the decree collaterally in an independent proceeding, brought indeed for that express purpose on the equity side of the court.' The bill in equity is dismissed."
The plaintiff excepted to the finding and ruling, "that all the issues sought to be raised in this case can now be litigated in the Probate Court"; to the ruling that this "bill in equity is an attempt to collaterally attack the decree of the Probate Court"; to the ruling based on Gordon v. Gordon, 55 N.H. 399, that this proceeding is an attempt "to impeach the decree collaterally"; and to the dismissal of the bill.
Following the filing and allowance of plaintiff's bill of exceptions, the Court made certain clarifying findings and rulings as follows: "In the findings and rulings entered July 18, 1948, the court, among other things, said: `It appears that all issues sought to be raised in this case can now be litigated in the Probate Court.' By this statement the court meant that all issues of fraud raised by the pleadings can be litigated in the Probate Court, and in order that there will be no further misunderstanding, the court now specifically finds, so far as it is a question of fact, and rules, so far as it is a question of law, that no constructive trust was established as to the real estate." To these findings and rulings the plaintiff excepted.
A bill of exceptions was allowed by Wheeler, J.
Upton, Sanders Upton and William D. Tribble (Mr. Tribble orally), for the plaintiff.
Sulloway, Piper, Jones, Hollis Godfrey (Mr. Jones orally), for the defendant.
Even if the plaintiff and the defendant were tenants in common of the farm, this fact alone did not prevent the defendant from buying the plaintiff's interest at the judicial sale of the administrator. The fiduciary relationship that exists between tenants in common is limited to the acquisition of a title adverse to the common interest. "Since the doctrine applies only to the case of the acquisition of an adverse title, it does not apply when one cotenant purchases a title not adverse, as in the case of a purchase of the reversion by one colessee, or where a joint remainderman purchases the life estate, or to a purchase by one cotenant of the interest of the other at execution or judicial sale. And a cotenant is at liberty, it seems, to purchase on his own behalf at a sale for taxes assessed merely on the other cotenant's interest in the property. Nor does the rule restrict the right of cotenants to buy from each other." 2 Tiffany, Real Property (3rd ed.) 292, 293.
The plaintiff is estopped from claiming that she and the defendant were tenants in common of the one-third undivided interest in the farm belonging to the Charles W. Colby estate. On filing her release of dower and homestead, she became entitled to all the real estate of her husband to the amount of $7,500 and one-half in value of the remainder. R. L., c. 359, s. 10, par. III. This completely excluded the defendant from any participation in said one-third or the proceeds thereof. Accordingly, she is precluded by reason of her own conduct from maintaining that she and the defendant were tenants in common of this one-third interest. If she is barred from this position, then she cannot assert that as a matter of law his purchase at the judicial sale of the administrator resulted in a constructive trust for her benefit.
Moreover, the Court was not obliged to find a confidential fiduciary relationship because of the fact that the parties were brother-in-law and sister-in-law and because of the alleged declarations of trust and confidence between them. It was for the Court to believe or disbelieve the conflicting evidence and to evaluate it.
The finding of the Court that there was not a constructive trust was properly made in its discretion.
However, the ruling that the bill in equity was an attempt to attack collaterally the decree of the Probate Court granting the license to sell was erroneous. The bill alleges that the defendant purchased the one-third interest in violation of his confidential and fiduciary relationship, duties and obligations to the plaintiff, and prays that he be ordered to account for the proceeds of the sale of said interest by him to one Gardner. The plaintiff is not attacking collaterally or otherwise the decree of the Probate Court of the sale of the real estate of the deceased.
Strates v. Dimotsis, 110 F.2d 374, was an action by surviving heirs to impress a trust upon certain real estate fiducially acquired by the administrators. The court on pages 375, 376 said: "By decree the court impressed a trust upon the property in favor of Mrs. Eugenia Dimotsis, individually, and as guardian and next friend of the minor children. The appellants contend that the proceedings below constituted a collateral attack on the judgment and orders of the Probate Court. They cite and rely upon numerous Texas decisions which hold that where the jurisdiction of the Probate Court has once attached `the orders and judgments of such court must stand until set aside, and could not be collaterally attacked.' . . . The contention of the appellants is without merit. The action was one to impress a constructive trust on the property and not one to attack the orders and judgment of the Probate Court or to set aside or invalidate the sale made under its authority." See also, Holt v. Dickmann Real Estate Company, 140 S.W.2d 59, 64; 31 Am. Jur. 210.
A collateral attack has been defined as follows: "A collateral attack is an attempt to avoid, defeat, or evade a judgment, or to deny its force and effect, in some incidental proceeding not provided by law for the express purpose of attacking it." 49 C. J. S. 809. The plaintiff does not seek to avoid, defeat or evade the probate decree but asserts the validity of it as authorizing transfer of legal title to the one-third interest in the farm to subsequent purchasers, so that she may have an accounting of the proceeds.
The decision that there was no constructive trust as a matter of fact was not in any way based upon the erroneous ruling that the bill was a collateral attack upon the Probate Court decree. The trust was claimed because of a fiduciary relationship between the parties arising from their being brother-in-law and sister-in-law and from alleged declarations between them. In order to determine whether or not a trust existed such as was claimed, it was necessary to consider these facts. The ruling that the bill was an attack upon decree of the Probate Court related to an independent issue. So far as the determination of a constructive trust was concerned it was immaterial. The Court was obliged to find or fail to find the trust on the evidence. The erroneous ruling was not evidence. Accordingly, it can reasonably be said that this ruling did not prejudice the outcome of the trial. Emery v. Woodward, ante, 61. The bill was dismissed on two independent grounds, each specifically ascertained. The correct one was entirely adequate for the result reached. Since the absence of a trust was found, the dismissal of the bill necessarily followed.
Bill dismissed.
All concurred.