Opinion
No. 33632-4-II.
October 10, 2006.
Appeal from a judgment of the Superior Court for Pierce County, No. 03-4-01511-6, D. Gary Steiner, J., entered August 1, 2005.
Counsel for Appellant(s), Hal Jay Geiersbach, Law Offices of Hal J Geiersbach, 8910 184th Ave E Ste F, Bonney Lake, WA, 98390-8531.
Counsel for Respondent(s), Derek W. Jensen, Jensen Law Office PLLC, 8420 Dayton Ave N, Seattle, WA, 98103-4227.
Sally N. Rees, Lutz Law Offices PS, 1607 S 341st Pl, Federal Way, WA, 98003-6865.
Reversed and remanded by unpublished opinion per Armstrong, J., concurred in by Bridgewater and Hunt, JJ.
The Estate of Jacqueline M. Landry appeals an order granting an award in lieu of homestead to Eugene Landry, Jacqueline's surviving spouse. The Estate argues that the award was improper because (1) the parties had previously manifested an intent to legally separate; (2) the husband constructively waived his right to an award; (3) equitable estoppel bars the husband's claim; (4) the Estate should have an opportunity to argue that the award in lieu of homestead should be less than the statutory allowance; and (5) the court should impose a constructive trust. We reverse and remand for an evidentiary hearing.
FACTS
On May 20, 2003, the Landrys separated. On June 20, 2003, Jacqueline executed a will in which she acknowledged the community property of the marriage and gave all her separate property and her share of the community property to her four children from a previous marriage. On July 17, 2003, the Landrys filed a petition for a legal separation. On October 12, 2003, Jacqueline died. Consequently, the petition for legal separation was dismissed.
We use the parties' first names for ease of reading and do not intend any disrespect.
While the parties argued and the court found that Jacqueline filed this petition on June 17, 2003, the superior court docket shows that she filed the petition on July 17, 2003. See Pierce County Case No. 03-3-02167-8.
The only tangible asset the Landrys owned was an unimproved vacant lot. The Estate notified Judith Aldrich, who had power of attorney for Eugene, that it was filing a claim against the home sale proceeds. After Aldrich sold the lot, Fidelity National Title (Fidelity) acted as the escrow company. It had Aldrich but not the Estate sign a warranty deed. Fidelity then closed the sale and distributed the $95,014.32 in proceeds to Eugene. After the Estate contacted Fidelity, Fidelity admitted its error and sent a letter to Aldrich demanding that Eugene return the money.
Eugene did not return the money and on February 15, 2005, filed a petition for an award in lieu of homestead. A superior court commissioner denied the petition. On revision, the superior court granted an award and made findings of fact consistent with this recitation and entered two conclusions of law:
1. The facts do not rise to the requirements of In Re Estate of Lindsay, 91 Wn. App. 944, 957 P.2d 818 (1998) regarding waiver of a spousal award.
2. Petitioner Eugene Landry, the surviving spouse to Decedent and a party of interest herein, meets all of the qualifications for an award under RCW 11.54 against the decedent spouse's estate.
Clerk's Papers (CP) at 51. The court then approved a spousal award of $40,000 assessed against the sale proceeds of the real property. The Estate appeals.
Analysis
We consider the trial court's ruling as a CR 12(c) judgment on the pleadings. The record contains no factual evidence, only the parties' assertions in the pleadings. In fact, Eugene argued below that the court could decide the matters before it as a matter of law. The Estate argued, and Eugene agreed, that if the court granted the award, whether it should be reduced was a factual question that required an evidentiary hearing. Nonetheless, because the court decided these questions as a matter of law:
we will treat the trial court's order as a judgment on the pleadings, which we review de novo. See City of Moses Lake v. Grant County, 39 Wn. App. 256, 259, 693 P.2d 140 (1984); Loger v. Washington Timber Prods., Inc., 8 Wn. App. 921, 924, 509 P.2d 1009 (1973); see also American Civil Liberties Union v. Blaine Sch. Dist. No. 503, 86 Wn. App. 688, 692, 937 P.2d 1176 (1997).
In reviewing an order entering judgment on the pleadings, we examine the pleadings to determine whether the claimant can prove any set of facts, consistent with the complaint, which would entitle the claimant to relief. Moses Lake, 39 Wn. App. at 258, citing Gould v. Mutual Life Ins. Co., 37 Wn. App. 756, 759, 683 P.2d 207 (1984).
North Coast Enter., Inc. v. Factoria P'ship, 94 Wn. App. 855, 858-59, 974 P.2d 1257 (1999).
1. Estate of Lindsay
The Estate first argues that the court failed to properly address its claim that In re Estate of Lindsay, 91 Wn. App. 944, 957 P.2d 818 (1988), demonstrates that Eugene waived his right to an award in lieu of homestead.
In Lindsay, the court held that a surviving spouse may waive his right to a homestead allowance by express writing or by conduct. Lindsay, 91 Wn. App. at 950 (citing In re Estate of Boston, 80 Wn.2d 70, 75, 491 P.2d 1033 (1971)). Four years before Murray Lindsay's death, the Lindsays had executed a legal separation agreement, relinquished any claim to the other's property, and agreed that any reconciliation or change in the agreement would need to be in writing. Lindsay, 91 Wn. App. at 947, 951. Also, Murray Lindsay revoked his previous will and executed a new one, leaving his entire estate to his mother. During their separation, the Lindsays periodically lived together and had sexual relations. The court held:
The agreement clearly reflects an intent to give up those rights which would normally follow legal spouses. And when "ascertaining the intention of parties to a written agreement, we must look to the wording of the instrument itself as made by the parties, view it as a whole, and consider all of the circumstances surrounding the transaction, including the subject matter together with the subsequent acts of the parties to the instrument."
Lindsay, 91 Wn. App. at 951 (quoting In re Estate of Garrity, 22 Wn.2d 391, 398, 156 P.2d 217 (1945); In re Estate of Brown, 28 Wn.2d 436, 440, 183 P.2d 768 (1947)). The court found no error in the superior court's conclusion that the Lindsays had a defunct marriage:
By the separation agreement, they divided all property and waived all claims to the other's property. The agreement was never rescinded, revoked, or altered. Both executed wills leaving nothing to the other. And between October 1, 1991, and Murray's death on November 30, 1995, they did not live together, except for brief temporary periods.
Lindsay, 91 Wn. App. at 952. The court rejected Cathy Lindsay's claim that she never expressly waived the homestead exemption, holding that an implied waiver was sufficient: "The test is whether the parties through their actions have exhibited a decision to renounce the community 'with no intention of ever resuming the marital relationship." Lindsay, 91 Wn. App. at 951 (quoting Parrish v. Jones, 44 Wn. App. 449, 456-57, 722 P.2d 878 (1986) (quoting Peters v. Skalman, 27 Wn. App. 247, 252, 617 P.2d 448 (1980))).
The Estate contends that the facts here are equally compelling. The parties physically separated on May 20, 2003. Jacqueline executed a new will on June 23, 2003, petitioned for legal separation and a restraining order against Eugene on July 17, 2003. These facts, the Estate argues, show that the parties clearly intended to permanently separate. The Estate argues that the trial court erred in ruling as a matter of law and should have held a trial so that supporting evidence could be presented.
Eugene distinguishes Lindsay, arguing that here the Landrys had been separated for only a few months, not two years, the Landrys did not have a binding settlement agreement as had the Lindsays, and Jacqueline's will still acknowledged Eugene as her husband and confirmed his interest in their community property. He concludes that there is no evidence in the record to show that the marriage was defunct.
While it is a legal conclusion that a marriage may be defunct, that conclusion is based on factual matters that cannot be resolved as a matter of law. Here we have outward manifestations of the parties' intent, but we cannot decide what the parties intended without an evidentiary hearing. The trial court should have taken evidence, resolved conflicting testimony, and entered findings of fact.
2. Defunct Marriage
Alternatively, the Estate argues that the parties' marriage was defunct as a matter of law. In Peters, 27 Wn. App. at 252-53, the court explained when a marriage is defunct:
A defunct marriage exists where it can be determined that the spouses, by their conduct, indicate that they no longer have a will to union. Physical separation, by itself, does not negate the existence of the community. The test is whether the parties through their actions have exhibited a decision to renounce the community "with no intention of ever resuming the marital relationship." Although previous cases in which a defunct marriage was found involved a long separation following entry of an interlocutory divorce decree or execution of a written separation agreement, we are satisfied that so long as the actions of the parties evidence an intent to renounce the marriage, no such formal action is necessary.
(Citations omitted.) See also Parrish, 44 Wn. App. at 456-57. In Peters, the wife sought to use her marital status as a defense against her husband's adverse possession claim. The court held that the defense was not available to the wife because the marriage was defunct as the parties had been separated for 29 years, there had been a complete absence of contact between them, and the parties had made comments about their marital status. Peters, 27 Wn. App. at 253.
In Parrish, the husband sought an apportionment of a wrongful death medical malpractice settlement. The parties had been legally separated until three weeks before the wife's death. The estate claimed that the parties' marriage was defunct. The trial court ruled in favor of the estate but the reviewing court reversed, finding that the husband's affidavit claiming that they had reconciled and intended to resume the marital relationship raised a question of fact. Parrish, 44 Wn. App. at 457-58.
Similarly here, the Estate argues that the trial court denied it an opportunity to show that the marriage was defunct. In fact, it argues, the trial court did not even make a finding on whether the marriage was defunct. It argues that sufficient evidence exists to show that the marriage was defunct and, thus, it is entitled to an evidentiary hearing to resolve the issue.
Eugene points out that the petition for legal separation and the restraining order are the two documents the Estate relies on yet neither is part of the record. Because of this, he argues, the court cannot extrapolate the parties' intent or examine the circumstances in which they were made. See In re Garrity, 22 Wn.2d 391, 397, 156 P.2d 217 (1945) (upon death, an interlocutory divorce order becomes a nullity for all purposes). Thus, he argues, the court may only consider the fact that a petition was filed, not the allegations and assertions made in the petition.
Because the Landrys did not have a legal separation agreement, Eugene argues that the fact that they filed a petition can have no conclusive effect on an award in lieu of homestead. See In re Estate of Nelson, 85 Wn.2d 602, 608, 537 P.2d 765 (1975) (only marital separation agreements disposing of the parties' property survive the death of either spouse). Eugene points out that all the cases the Estate relies on involved legal separation agreements except Peters v. Skalman, supra, and there the parties had been separated for 29 years and had dealt with their property as separate persons that entire time.
Whether a marriage is defunct depends on the facts that show what the parties intended. Here the court erred in deciding this issue on the allegations in the pleadings.
3. Equitable Estoppel
The Estate next argues that Eugene should be equitably estopped from asserting his claim. The doctrine of equitable estoppel only applies when the party asserting the doctrine establishes three things:
(1) an admission, statement, or act, inconsistent with the claim afterwards asserted;
(2) action by the other party on the faith of such admission, statement, or act; and
(3) injury to such other party arising from permitting the first party to contradict or repudiate such admission, statement, or act.
Shafer v. State, 83 Wn.2d 618, 623, 521 P.2d 736 (1974).
The Estate argues that it established all three elements as follows. One, Eugene physically separated from Jacqueline, joined in a formal separation agreement, and abided by temporary restraining orders but then, after Jacqueline's death, he asked for and received an award in lieu of homestead. Two, Jacqueline relied on the decision to separate, left her residence, and executed a new will leaving her assets to others. And three, Eugene's pursuit of an award in lieu of homestead is counter to his earlier decision to waive such a right through a permanent separation.
Eugene responds that the Estate has not presented clear, cogent, and convincing evidence of any wrongdoing on his part. First, the title company's mistake was not his wrongdoing. Second, the proceeds of the sale remain community property unless or until terminated by court order. Peters, 27 Wn. App. at 251-52 (possession of community property by one spouse can never be hostile to the other spouse's interests as possession and management inures to the benefit of the community).
First, the Estate did not raise this claim below and, thus, may not raise it on appeal. RAP 2.5(a). Second, in light of our disposition, this issue is best raised at trial as it too involves factual questions.
4. Constructive Trust
The Estate next argues that this court should reverse based on the common law doctrine of constructive trust. This is appropriate, it argues, because Eugene filed his request for an award in lieu of homestead only after having mistakenly taken Jacqueline's portion of the proceeds from the real estate sale. Further, even after receiving two demand letters, Eugene has not returned the disputed funds.
In general, whenever the legal title to property, real or personal, has been obtained through actual fraud, misrepresentations, concealments, or through undue influence, duress, taking advantage of one's weakness or necessities, or through any other similar means or under any other similar circumstances which render it unconscientious for the holder of the legal title to retain and enjoy the beneficial interest, equity impresses a constructive trust on the property thus acquired in favor of the one who is truly and equitably entitled to the same; . . . and a court of equity has jurisdiction to reach the property either in the hands of the original wrong-doer, or in the hands of any subsequent holder, until a purchaser of it in good faith and without notice acquires a higher right.
Peste v. Peste, 1 Wn. App. 19, 23, 459 P.2d 70 (1969) (quoting Viewcrest Coop. Ass'n v. Deer, 70 Wn.2d 290, 293, 422 P.2d 832 (1967); Bangasser Assoc. Inc. v. Hedges, 58 Wn.2d 514, 516, 364 P.2d 237 (1961)).
The Estate argues that a constructive trust is the only means of preserving the misappropriated funds pending resolution. The Estate did not raise this claim below and, thus, we decline to address it. RAP 2.5(a). This question, too, is best resolved below.
5. Award Reduction
Lastly, the Estate argues that this matter should be remanded for a hearing to determine if a reduction in the amount of the award is appropriate. Counsel below requested such a hearing but the superior court ruled without holding such a hearing.
RCW 11.54.050 allows for a decrease in the amount of the award:
(2) An award to a surviving spouse is also discretionary and the amount otherwise allowable may be reduced if: (a) The decedent is survived by children who are not the children of the surviving spouse and the award would decrease amounts otherwise distributable to such children; or (b) the award would have the effect of reducing amounts otherwise distributable to any of the decedent's minor children. In either case the court shall consider the factors presented in RCW 11.54.040(2) and (3) and whether the needs of the minor children with respect to basic maintenance and support are and will be adequately provided for, both during and after the pendency of any probate proceedings if such proceedings are pending, considering support from any source, including support from the surviving spouse.
Here, the court awarded $40,000 to Eugene. This is nearly the entire amount that Jacqueline sought to distribute to her children (her community property interest in the proceeds was $47,507.16, leaving only $7,507.16 to be divided among her children).
Eugene argues that the Estate has failed to present any legitimate reason why the court should have reduced the award. He argues that he complied with all statutory prerequisites, that he is the intended beneficiary of the statute, and that the court did not abuse its discretion in following the statute. Moreover, he argues that the purpose for giving the court discretion to reduce the award is to protect minor children, not adult children. See In re Estate of Garwood, 109 Wn. App. 811, 813-817, 38 P.3d 362 (2002) (citing In re Estate of Dillon, 12 Wn. App. 804, 805-06, 532 P.2d 1189 (1975) (the statute was enacted to protect and benefit the surviving spouse and/or minor children.)); see also In re Estate of Ford, 31 Wn. App. 136, 141-42, 639 P.2d 848 (1982) (granting of an award is generally mandatory but, if there are children of the deceased by a former marriage, court may deny or reduce award). And, Eugene argues, since none of the children petitioned for an award reduction, the trial court properly granted him the entire statutory amount.
Eugene quotes an unpublished opinion, Estate of Perry, 2000 Wash. App. LEXIS 211, thereby violating RAP 10.4(h). As this case has no precedential value, we do not consider it.
But the issue is not ripe for review at this time. If the trial court finds that the marriage was not defunct, it may then address this issue.
We reverse and remand.
A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record pursuant to RCW 2.06.040, it is so ordered.
BRIDGEWATER, P.J. and HUNT, J., concur.