This dispute at its present stage is largely one over real estate in Jacksboro, Jack County, between the plaintiff (our respondent) A. A. Ellis, as community survivor of, and beneficiary under the will of his late wife (hereinafter referred to as the testatrix) and the defendants (our petitioners), who are her executor (Wallace C. Hodge) and the remaining beneficiaries of the will, that is, her sister (Mrs. Hodge) niece (Mrs. Motley) and a grandnephew (Avon Motley). From the judgment, rendered upon a nonjury trial and with largely general findings, the respondent-plaintiff seeks no relief, despite some adverse rulings, including adjudication to the petitioners-defendants
The items of property in question are: (a) a group of tourist courts hereinafter referred to as the Stewart property; (b) an apartment house called the Walker property; (c) another apartment property called the Wilson property; and (d) the community homestead. All of them except (d) stood in the name of the testatrix as her separate property at her death in 1950, and her will, executed in 1948 and duly probated, purports to make specific disposition of them all in favor of the petitioners-defendants, except that it recognizes the respondent-plaintiff's community half-interest in the homestead (devising "my community interest" to the petitioners-defendants), and except that the respondent-plaintiff is devised a life estate in item (a) above. The respondent-plaintiff, asserting that the properties were acquired with community funds, has been awarded a community half interest in them all, along with a life estate in the testatrix' half of item (a) under the will, as against the contentions of the petitioners-defendants that all, except the homestead, were truly the separate property of the testatrix, and that in any event the respondent-plaintiff was required to elect between his community interest and his benefits under the will. The petitioners-defendants have also fruitlessly argued the "no contest" provisions of the will to be violated by this suit. As between the petitioners-defendants themselves there is no dispute.
The principal question is, of course, that of community versus separate estate, and, as the court below justly observed, it is rendered difficult by reason of the scarcity of detailed or positive evidence on various important points. Indeed, aside from the exhibits of the probate proceedings and the deeds and notes reflecting the purchase of the properties in dispute, practically all of the evidence is the testimony of the respondent-plaintiff.
The testatrix and the respondent-plaintiff were married in 1937 and came to live permanently in Jacksboro at some date between 1938 and 1942, residing there together until her death. Properties (a), (b), and (c) above mentioned were acquired respectively in 1945, 1946 and 1947 from the Stewarts, Walkers and Wilsons as the respective grantors. The deeds were respectively recorded at Jacksboro promptly upon execution. Each one stated the corresponding premises to be conveyed to the testatrix as her separate property, using these four latter words or similar ones, although making no express reference to the source of any of the consideration (cash or deferred) as separate or community, except in the case of the Wilson deed (actually two deeds) in which there was the brief reference, "the sum of Ten and More Dollars — from her separate estate." In the Stewart and Walker purchases the consideration was both cash and an installment note, the corresponding figures in the former being $3,000 and $6,000, and in the latter $5,000 and $3,000, as duly recited in the deeds. In the Wilson, which was the latest, the total consideration of $8,000 was paid with a cashier's check of the First National Bank at Jacksboro and a small cash sum, both being the proceeds of a loan from that bank, evidenced by a note for $8,000 secured by deed of trust upon all this property and the other two. The notes in the Stewart and Walker transactions were signed by the testatrix alone, but that in the Wilson, as well as the corresponding deed of trust, was signed by both spouses. None of the notes themselves (nor, apparently, the Wilson deed of trust) made any clear reference to the separate estate of the testatrix, although the note for the Wilson money did recite that it was "borrowed by Willie Lesca Ellis from said First National Bank."
The testimony of the respondent-plaintiff is susceptible of the construction that at the time of the marriage (1937) the testatrix owned nothing but real estate in Wise County, except for an inheritance of $600 received earlier in the same year; and it appears from such testimony and the inventory
The respondent-plaintiff further testified that the testatrix received during the marriage a rather substantial income (several hundred dollars a month) from the Jacksboro properties other than the homestead following their respective acquisitions in early 1945 and thereafter, about $60 per month from her Wise County properties from 1937 onward, as well as some $3,000 from her services as a nurse and about $3,000 as the profit from raising chickens. While some of this testimony is not overly convincing, it does amount to saying that the testatrix received during the marriage approximately enough community funds to have made, at the very least, the cash payments on the Stewart and Walker properties, the Wilson having been bought, as before stated, last, and entirely with the proceeds of a bank loan. Indeed, the respondent-plaintiff testified in so many words that the testatrix used the chicken money to pay for the Walker place.
It appears that sometime or other after the spouses had moved to Jacksboro, apparently around 1941, they opened two bank accounts, each in his or her own name (presumably without any words like "separate property" in the title of either account) and that the testatrix kept in her account the funds coming into her possession as above mentioned, while the respondent-plaintiff kept in his account whatever funds came into his possession, including his earnings as a carpenter. This was all evidently without any formal agreement, but at the same time without objection by either party. The respondent-plaintiff testified also that at some unstated times and in some unstated amounts each had deposited in and checked from the accounts of the other, but it seems that this was not a regular practice, and it does not appear that either ever knew what balance the other had. He appears to have bought real and personal property, giving checks therefore on his own account and considering the property as his own. He said the separate system was followed "for business reasons", without further explanation. There is at least an inference from his testimony that some of the payments on the properties in question came from the accounts of the testatrix, and evidently none came from his. The bank president testified without contradiction that at least a large portion of the payments on the note for the Wilson purchase were made by the testatrix in currency rather than by check. There is nothing in the inventory or otherwise to indicate that the testatrix had but the one bank account during the marriage unless by inference from the size of the cash payments on the Jacksboro purchases. No relevant bank records concerning the accounts were in evidence, nor any proof as to what amounts, whether separate, community or both, were in either account at any given time nor any explanation of why her account had disappeared at the time of the inventory. While each evidently knew that the other, from time to time, made deposits in and drew checks on his or her respective account, there is no evidence as to the presence, knowledge or consent of one party on the occasion of any particular deposit or withdrawal by the other, or on the occasion of the creation of either account.
Despite his knowledge of the business affairs of the testatrix with reference to the
The elemental presumption in favor of the community as to land acquired in the name of either spouse during the marriage is, indeed, sometimes displaced by a presumption in favor of the separate estate of the wife where the deed of acquisition recites either that the land is conveyed to her as her separate property, or that the consideration is from her separate estates, or includes both types of recitation. McCutchen v. Purinton, 84 Tex. 603, 19 S.W. 710; Goldberg v. Zellner, Tex.Com. App., 235 S.W. 870; Smith v. Buss, 135 Tex. 566, 144 S.W.2d 529; Paudler v. Paudler, 5 Cir., 210 F.2d 765; Evans v. Purinton, 12 Tex.Civ.App. 158, 34 S.W. 350, wr. of er. refused, per Tarlton, C.J. See also comments in Kahn v. Kahn, citing the McCutchen case, 94 Tex. 144, 118, 58 S.W. 825, 826. This latter presumption, like most others concerning the same subject matter, is generally rebuttable. Cases cited, supra; also Kearse v. Kearse, Tex. Com.App., 276 S.W. 690. And its importance, of course, lies in the manner of its application to particular sets of facts. For example, where, as in Goldberg v. Zellner, Smith v. Buss and Paudler v. Paudler, all supra, the husband is a party to the transaction, the result generally is to hold the property to be separate property of the wife, even though the consideration be community or from the separate estate of the husband, even though the husband on the trial denies that the purchase was by way of a gift of either to the wife. And in such cases where all or part of the consideration is contractual, as where, for example, the deed to the wife stating the conveyance to be for her separate benefit and in consideration of her separate funds, is made pursuant to an installment purchase contract of the husband and wife, itself expressly providing for the payments to be made from her separate funds, we have invoked the parol evidence rule to exclude proof by the husband that the consideration was actually community and the purchase actually for community benefit. Lindsay v. Clayman, 151 Tex. 593, 254 S.W.2d 777. The Goldberg and Paudler cases, supra, also involved executory consideration in that there were purchase money notes signed by both husband and wife, though not mentioning the source of the stipulated payments as separate or community. In the Smith case the deferred consideration was payable from the wife's separate estate according to notes signed by her alone, all as recited fully in the deed. The three decisions were all in favor of the wife's separate estate, but do not in terms rest on the parol evidence rule.
Where the husband is a party to the purchase for the purported separate interest of the wife, even though his name may not appear in the documents, (see Smith v. Buss, supra,) there is good reason to presume the recitals in the deed to be true, because his position as regards the wife and the community is much the same as if he were the grantor, and in the latter situation it would be at least unusual that he should intend to convey to the community when the property was already community or even where it was his separate property. "Such a construction would be equivalent to holding that it passed the title from the community to the community; or, in other words, that it passed nothing." Gaines, A.J., in Lewis v. Simon, 72 Tex. 470, 475, 10 S.W. 554, 556, as quoted in Kahn v. Kahn, 94 Tex.
Thus in the latter instance not only is the husband free of the parol evidence rule in proving the community nature of the transaction as against the separate property recitals in the deed, but also there would seem to be little more reason to apply a presumption from the recitals in favor of the wife's separate estate then to apply the elemental presumption to the contrary effect. It is accordingly reasonable to say that in such a case, once there is adduced evidence of probative force tending to show the property to have been purchased with community funds, the question as to the status of the property is ordinarily one of fact.
Applying these principles to the instant case, we first conclude that the joinder of the respondent-plaintiff in the bank note in the Wilson purchase makes an important difference between it and the Stewart and Walker purchases. Regarding the two latter, which we will discuss more fully further on, there may well be ground to support implied findings of the trial judge in accord with the testimony of the respondent-plaintiff to the effect that he was in nowise a party to the transactions, and that the property was purchased with community funds. But to say that the respondent-plaintiff was not a party to the Wilson in the face of what he admits knowing generally, plus the fact that he was expressly a party to the bank note and deed of trust, would be too much at variance with human experience, in the absence of proof of duress or fraud on the part of the testatrix or the bank, of which there was none. Since he was undoubtedly a party to the transaction, we may thus hold the Wilson property to be separate on the theory of implied gift from the respondent-plaintiff as a matter of law, considering the recitals in the deed that the premises were conveyed as separate property for separate property consideration, whatever be the actual character of the consideration and despite that the note may have bound the community. Goldberg v. Zellner, Smith v. Buss, Paudler v. Paudler, all supra. Or we may say with almost equal certainty that the respondent-plaintiff was cut off by the parol evidence rule from showing the consideration or nature of the estate conveyed, should these be at variance with the mentioned recitals. Lindsay v. Clay man, Kahn v. Khan, both supra; McKivett v. McKivett, 123 Tex. 298, 70 S.W.2d 694; Davis v. Davis, 141 Tex. 613, 175 S.W.2d 226. That the note itself did not speak of separate funds (although it did say "borrowed by Willie Lesca Ellis") and was not referred to in the deed, does not change the result. It was all one transaction, and the deed recited "from her separate estate."
Regarding the Stewart and Walker properties, the evidence suggests two general lines of approach. The first is whether, viewing it as a whole, the respondent-plaintiff was, as a matter of law, a party to these purchases also, which would in turn lead to the conclusion either that he should be deemed to have made a gift of any community interest he might otherwise have enjoyed in the properties or that he was barred by the parol evidence rule from contesting the recitals in the deeds. The other approach is whether, assuming him not to have been connected with the purchases as such, yet the funds that went into them were, as a matter of law, the testatrix' separate funds, for reasons such as lack of any evidence indicating them to be community or because his conduct prior to the purchases had effected a gift or other valid transfer of the funds to her separate estate.
Since he signed no papers in connection with either purchase transaction, it seems impossible to reject, as a matter of law, his testimony, however "thin", that he had no detailed knowledge of the deeds, especially when the latter is consistent with the more or less undisputed fact that both parties customarily acted "on their own" to a considerable degree in business matters. From the fact that he bought land with his earnings and considered it his property, it does not necessarily follow that whenever the testatrix may have bought land with community funds he made a gift of that land to her. To say that he was legally charged with specific knowledge of, and thus also participation in, each purchase, merely because of the custom prevailing between them, is the equivalent of approving an agreement determining the status of future property in the face of out decisions to the contrary. See Brokaw v. Collett, Tex.Com.App., 1 S.W.2d 1090, and cases therein cited; Strickland v. Wester, Tex.Com.App., 131 Tex. 23, 112 S.W.2d 1047; also Huie, The Community Property Law of Texas, in 13 Vernon's Tex. Civ.Stats.Ann., p. XXVIII, Sec. 9. In this connection, decisions such as Robbins v. Robbins, Tex.Civ.App., 125 S.W.2d 666 and Atlanta Nat. Bank v. Map, Tex.Civ.App., 261 S.W. 191, upholding trial court findings in favor of the wife's separate estate upon inference of gift do not appear persuasive for overturning contrary findings as a matter of law upon a similar state of facts. Nor do the 1948 amendment to Sec. 15, Art. XVI of our State Constitution, Vernon's Ann.St., permitting formal division of community property, and the corresponding Art. 4624a, Vernon's Tex.Civ. Stats.Ann.(1949) purport to validate informal divisions in advance of acquisition of the property in question or otherwise change the existing law on the general subject except to the extent expressly provided in the enactments mentioned.
Viewing the matter then as one to be determined according to what funds went into the purchases, there is evidence that both separate and community funds came into possession of the testatrix, to wit, the $600 inheritance about 1937 and the $5,625 proceeds of her Decatur separate property around early 1946, and on the other hand, the rents from her Wise County property of about $60 per month from the very beginning of the marriage, her earnings between 1937 and 1947 of about $3,000, the profits of the chicken business between 1942 and 1945 of about $3,000 and, beginning with early 1945, the rents from the Stewart property (between $200 and $300 per month) and the other properties as these were acquired. These rentals, earnings and profits were undoubtedly all community property in their inception. Aside from the statements — largely conclusions — that the chicken money went into the Walker purchase, and that all funds handled by the testatrix went through her bank account, we have only inferences as to what was done with either the one type of funds or the other. However, considering the substantial amounts of the community type funds in relation to the amount
Conceivably the otherwise community portion of the funds might, prior to the use of both types in the purchases, have somehow become the separate property of the testatrix, so as to result in the purchased property being clearly separate because acquired entirely with separate funds. But the burden to show that fact would be on the petitioners-defendants, and we cannot say that they have established it as a matter of law. If we say that all of the erstwhile community funds (as well as the separate) went into the testatrix' bank account (whence there was some evidence that all purchase payments were made) such would not necessarily make them separate funds. The presumption concerning separate property status of bank accounts established by Art. 4622, Vernon's Tex.Civ.Stats.Ann., does not apply where the contest is between the spouses themselves or their successors. It was so held by our Courts of Civil Appeals in Rippy v. Rippy, 49 S.W.2d 494, and Callaway v. Clark, 200 S.W.2d 447, 448, and in each instance we "refused" a writ of error. As before indicated, the general practice of the wife of putting erstwhile community funds into a bank account in her own name, even where the husband in effect concurs with the practice "for business reasons", can hardly be considered a gift from him of all such funds as a matter of law, without thereby validating agreements as to the status of future acquired property. We may add that the fact of intermingling the two types of funds beyond ability to resegregate them does not of itself cause the aggregate to be separate but rather the contrary. Rippy v. Rippy, supra. The Trammell case, supra, does not hold otherwise, and the relevant holding in Amend v. Jahns, Tex.Civ.App., 184 S.W. 729, 731, amounts to no more than that the commingling in the husband's bank account of proceeds of the sale of the wife's separate property "did not defeat her title to the proceeds", the jury having found in her favor.
Since we cannot say that the finding of the trial court that the Stewart and Walker properties were community is wrong as a matter of law, we must accordingly treat them as community.
The petitioners-defendants further contend that the respondent-plaintiff, who did not and does not contest the probate of the will, has yet by this suit violated the forfeiture provisions (paragraph Eighth) thereof forbidding even a "question" of "any clause thereof in any judicial proceeding" and therefore should be denied the benefits accorded him by the will.
The will refers directly to him only in paragraph Fifth, which devises the Stewart property
The only other reference to him is the indirect one in paragraph Fourth, which devises life estates to the sister and niece, with remainder in fee to the grandnephew, in the Walker and Wilson properties and in "my community interest in" the homestead.
It is to be noted that the above dispositions deal respectively with specific premises. Paragraph Third does likewise in devising the Wise County properties.
At this point we must say that, so far as the forfeiture contention, or the election contention hereinafter discussed, might impair the award of full homestead rights to the respondent-plaintiff, such contentions are immaterial, however meritorious. In their pleadings in the trial court, the petitioners-defendants affirmatively conceded to him the full homestead rights, which his pleadings asserted, and did not repudiate that judicial admission until the appeal. The change of position came too late and cannot now be validated, so the judgments below in this respect must remain undisturbed.
And in so far as the forfeiture contention applies to the life estate of the respondent-plaintiff in the Stewart property, it becomes probably immaterial for practical purposes in view of our within conclusion that he is faced with an election and thus cannot enjoy both the life estate and his community half interest in the fee of the Stewart and Walker. The value of the two community interests are, no doubt, such that he would not exchange them for a life interest in the whole of the Stewart, even if he has not forfeited his right to choose the latter as a result of the "no contest" provision of the will. We thus pass to the election question.
Since, as above indicated, the devises of the remainder in the Stewart and the full fee in the Walker to the petitioners-defendants are specific, they must be taken as intending to pass both undivided halves and not merely the testatrix' community half. The will thus disposes of property of the respondent-plaintiff. At the same time the life estate devised to him is a benefit, and one of which the testatrix might have deprived him by some alternative testamentary disposition of the property. What he would have taken in case of her intestacy has nothing to do with the matter of benefits. For a discussion of all these questions, see our recent decision in Wright v. Wright, Tex., 274 S.W.2d 670. The finding of the trial court that the testatrix did not intend to devise anything but the respective halves she owned, and the corresponding view of the Court of Civil Appeals that she was under a misapprehension as to her ownership, when she purported to devise both halves, do not change the situation. As stated in Wright v. Wright, supra, the question is merely the law question of whether the will itself is open to no other construction than that it disposes of property of the party to be charged with election. If so, there must be an election. If any other construction is available, the intent not to dispose of another's property is conclusively presumed. We might add that there is nothing whatever in the will to indicate that the testatrix would have written its clear terms otherwise than she did if she had been better advised about the status of the property in question.
The most serious argument against election is that the point was not raised until the appeal. The petitioners-defendants obviously did not plead it properly, their plea being in terms of a violation
As to whether an election has already been made, we do not consider the prosecution of this suit to have that result, because it is in effect but an effort to be allowed to take both under and against the will. Nor can it be said that the evidence otherwise shows an election one way or the other as a matter of law. Upon remand, the issue of actual election may be tried. Election by the respondent-plaintiff to take under the will results, of course, in an estate in his favor in the Stewart property until his death or remarriage, but also in his loss of the community interest which we otherwise adjudge to him in that property and the Walker property. In such event the remainder estate in the Stewart and all interests in the Walker will belong to the petitioners-defendants according to the terms of paragraphs Fifth and Fourth of the will. On the other hand, election against the will involves the loss to the respondent-plaintiff of his devised life interest in the Stewart, but immediate ownership by him of a community half interest in both properties, the other half interests going to the petitioners-defendants under Articles Fifth and Fourth of the will, respectively, as therein provided. The result in the case of the Stewart property would be that the stipulated remainder interest of the testatrix' sister, Mrs. Hodge, in the whole, becomes a presently possessory interest in half, as if the relinquished life estate of the respondent-plaintiff were a lapsed legacy.
Except as hereinafter noted, the rulings below present no error.
The judgments below are reversed to the extent hereinabove indicated, but otherwise affirmed. The cause is remanded to the trial court with instructions to modify its judgment so as to award the full title of the Wilson property to the petitioners-defendants in the manner provided by paragraph Fourth of the will, and for further proceedings incident to election by the respondent-plaintiff between his community rights in the Stewart and Walker properties and his life estate in the former under paragraph Fifth of the will in accordance with this opinion.
SMITH, Justice (concurring in part and dissenting in part).
I agree with the majority opinion on all points decided with the exception of the holding that the full title to the Wilson property passed to the petitioners under paragraph Four of the will. The mere fact that respondent joined in signing the note and deed of trust to secure the money which was borrowed to purchase the Wilson property does not overcome the undisputed evidence that respondent did not know of the recitations contained in the deed. The trial court found as a fact that the Wilson property was community property. The evidence does not show an intent on the part of respondent to make a gift of this property to his wife. The petitioners cite the case of Emerson-Brantingham Implement Co. v. Brothers, Tex.Civ.App., 194 S.W. 608, 609, no writ history, to support its contention that the signing of the note and deed
The trial court, upon controverted facts, found that the Wilson property was community and the Court of Civil Appeals has affirmed such holding. This Court cannot say as a matter of law the Wilson tract is separate property.
CALVERT and WALKER, JJ., join in this opinion.