Scott v. Umbarger

California Supreme Court Jul 1, 1871 No. No. 1,941Published

Before: Temple

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Holding. The court held that the defendants, who acquired title to the property from the City of San José, did not hold that title in trust for the plaintiffs because the plaintiffs lacked any legal or equitable interest in the land that would support a constructive trust.

Issues

Whether the defendant sufficiently denied notice of the fraud in the title of the administrator.
Whether the facts admitted in the pleadings established a constructive trust requiring the defendants to convey the title acquired from the City of San José to the plaintiffs.

Disposition. reversed and remanded

Quotations verified verbatim against the opinion

“The sale was, then, a fraud upon the heirs, and the defendants can only be protected upon the hypothesis that Umbarger was a purchaser for a valuable consideration, in good faith, without notice.”

“Therefore the defendants have never taken the legal title or any rights to the premises in trust for plaintiffs.”

“I therefore think the title acquired did not inure to the benefit of plaintiffs, and that the defendants cannot be compelled to convey to them.”

Synopsis

Purchase by ah Admihistrator at his owh Sale.—If a person procures himself to he appointed administrator of an estate, and at a sale of the property of the estate purchases the same through a third person, who pays no money, and agrees to hold the title for the administrator, the sale is a fraud on the heirs, and such third person, and all who buy from, him with notice, hold the property in trust for the heirs.

Denials in Answer.—K. acquired the legal title to land under such a state of facts as made his purchase fraudulent, and made him the trustee of S. IT. bought from K. S. commenced an action against TJ., to have him declared his trustee, and to compel him to convey the land. In' his complaint he averred the facts, showing K.’s fraud, and which, in law, made him the plaintiff’s trustee. S., in his answer, admitted these facts and his knowledge of them, but denied that he became the trustee of S., or that there was anything unfair or fraudulent in the facts alleged. Meld, that the answer admitted the trust.

Purchase erom One who Holds in Trust. — One who purchases land from another who acquired the title fraudulently, and thereby became a trustee, in order to protect himself in his purchase, must have been ignorant of any of the facts constituting the fraud, not only at the time of his purchase, but when he paid the purchase money and obtained his deed.

Constructive Trust.—If a party who is in possession of land, without right, legal or equitable, is fraudulently deprived of the possession by one who does not deprive him of any right at law resulting from his prior possession, and the one who thus obtains possession then purchases the title from the true owner, he does not hold this title in trust for the prior possessor, and cannot be compelled to convey it to him.

By the Court, Temple, J.: The complaint shows that Jane Scott, while a married woman—the wife of Charles Gr. Scott—purchased for a valuable consideration the premises in controversy and received a conveyance therefor; that Charles GL Scott took immediate possession of the premises, which he retained until his death, in 1856; that at the time of and- immediately before his death he was a resident of San Francisco, in this State, and plaintiffs are his only heirs at law. In 1860, one Frederick D. Kohler, designing to defraud plaintiffs out of the described premises, procured letters of administration upon the estate of Charles Gr. Scott, deceased, in Santa Clara County, and in pursuance of such fraudulent design made several unsuccessful efforts to procure an order of sale of the property for pretended debts and expenses of administration, and finally [416]succeeded in obtaining such order in December, 1861; that the order was made without legal notice to plaintiffs, and without authority on the part of the Court; that a pretended sale was made under this order, without notice given, at which Thomas Bodley was the purchaser, in February, 1862, which sale was afterward confirmed by the Probate Court, and conveyance made by the administrator; that the sale was wholly fictitious and for the benefit of Kohler, „no money being paid; that Bodley took the conveyance for Kohler, and at his instance and request, and agreeing to hold the title for Kohler; that Bodley had notice of the fraud contemplated by Kohler, and that the land was then worth nine thousand dollars—the purchase money being one thousand three hundred and fifty dollars. On’ the 19th day of April, 1862, Kohler being still administrator, with the view of further concealing his designs, caused a conveyance to be made by Bodley to one Charles Hosmer, for a nominal consideration of one thousand five hundred dollars, although no consideration was paid. Hosmer also took the conveyance at the instance and request of Kohler, agreeing to hold the same for him, with full notice of all the acts of fraud on his part. On the 21st day of June, 1862, Kohler caused the property to be conveyed to himself for a nominal consideration of one thousand five hundred dollars; that this conveyance was wholly fictitious—no money being in fact paid—Kohler at the time being and acting as administrator of Charles G. Scott, deceased. Kohler afterwards conveyed to defendant Umbarger, who was then in possession as Ms tenant in his capacity of administrator, and who had full notice of all the acts of fraud on the part of Kohler, Bodley, and Hosmer. Umbarger afterward conveyed to the other defendants portions of the premises, who also took with full notice.

Scott v. Umbarger

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