Brief for the Respondents in Opposition — Rule v. Sears

SUBJECT INDEX.

PAGE

I.

The case as made below and as treated by the Supreme Court

OE Califcormain com: thee engppreelhn nnn cscs erences

Il.

Petitioner has had his day in court upon the issue of a collateral

or secret agreement to create a trust and upon every other

issue involved in the case, including that of extrinsic fraud...

Il.

Petitioner acquired no vested rights under the decree of distribu-

tion, for the Probate Court was without jurisdiction to declare

the equities under which respondents claimed, as held by the

California Supreme Court

LES ALES SR EAGER OLN RO REE PET BoM EES HR IE Sy LPS NF

TABLE OF AUTHORITIES CITED.

CasEs. PAGE

Bjornquist v. Barton & A. R. Co., 250 Fed. 929; cert. den.

248 U. S. 593 .. 14

Bryant, Estate of, 3 Cal. (2d) 70 19

Curdy v. Berton, 79 Cal. 420. 17

Davey v. So. Pacific Co., 116 Cal. 325 14

Gillette v. Gillette, 122 Cal. App. 640 16

Hubbell, Estate of, 121 Cal. App. 38...... 15, 16

Martin v. Imbrie, 262 Fed. 44 13

McLellan, Estate of, 8 (2d) 49 15

Fleishacker v. Blum, 109 F. (2d) 542; cert. den. 311 U. S.

665 14

Houle v. Helena Gas & Elec. Co., 31 F. (2d) 671 -..----.---..-----e0e0+ 14

TRUS W, ZAMS OUIIR BEBE. GU. CRsccssnachsecnttisocisdternnsstnsintsnccserbiwese 17

Lyons v. Empire Fuel Co., 262 Fed. 465 14

Parkman v. Superior Court, 77 Cal. App. 321 15

q Peck v. Noee, A, See vadlideadiintdlte esrb inclanaaderisnsibebaitaant sweats 14

Prior v. Andrews, 83 Cal. App. 782........ 17

Rey, Estate of, $1 Cel. App. (2d) 646... 16

San Juan Light Co. v. Requena, 224 U. S. 89, 32 Sup. Ct. 399,

56 L. Ed. 680. 14

Sears v. Rule, 45 Cal. App. (2d) 374. 5

STATUTES.

California Code of Civil Procedure, Sec. 1699.0... ccccceceeeeee 15

California Constitution, Art. VI, Sec. 4% 14

California Constitution, Art. VI, Sec. 5 15

California Probate Code, Secs. 300-1242 15

California Probate Code, Sec. 1120 15, 16

TEXTBOOKS.

2 California Jurisprudence, p. 240 14

2 California Jurisprudence, p. 809 14

Restatement of the Law of Trusts, Sec. 54d 4, 18

Restatement of the Law of Trusts, Sec. 55h 4, 18

Restatement of the Law of Trusts, Sec. 411lq 4, 18

1 Scott on Trusts, p. 312 18

IN THE

Supreme Court of the United States

OcToBeR TERM, 1945

No. 1024

CHARLES T. RULE,

Petitioner,

US.

Hattie Sears, Epwin E. Weser, MINNIE LOUISE

Mattocks, et al.

BRIEF IN OPPOSITION TO PETITION FOR

CERTIORARI.

It is respectfully submitted that the petition for cer-

tiorari herein should be denied.

Under petitioner’s Point 1 it is claimed that he has

been unconstitutionally deprived of his day in court be-

cause, it is said, the California Supreme Court discarded

the “theory and cause of action” presented and relied

upon below and substituted “a new and different” theory

and cause of action which has never been the subject of

judicial inquiry or determination.

Under his Point 2 it is claimed that in any event the

California Supreme Court unconstitutionally deprived him

of the property vested in him by the earlier decree of

the probate court by giving the property (distributed

outright to him by the probate court) to persons other

Mielec es SRD EPA OE EES 2 PE REAR ARN ES x

fom. aon

than the beneficiaries under the collateral agreement de-

clared by it to be the basis of its decision and without

judicial inquiry into the validity, purposes, terms or ben-

eficiaries of such “purported” agreement or of any trust

resulting therefrom.

Neither point possesses merit. In order adequately to

answer them, however, it will be necessary to devote

some attention to the case as made below, and to the

California Supreme Court’s treatment of it on the appeal.

I,

The Case as Made Below and as Treated by the

Supreme Court of California on the Appeal.

The case pleaded, proved and found in the trial court

showed (1) that plaintiffs and cross-complainant Cotton

(we shall hereinafter refer to these parties collectively

as “respondents” ) were heirs-at-law of the decedent Sa-

rah E. Weber; (2) that the latter left a will; (3) that

although the will named petitioner Rule as sole resicuary

devisee, it was not the intention of the decedent that he

should take outright, but that he should take for undis-

closed persons previously agreed upon between them;*

(4) that petitioner denied having made any such agree-

ment and claimed the assets of the estate for himself;

and (5) that by divers and extrinsic frauds and conceal-

ments, not necessary here to be detailed, he prevented re-

spondents from presenting their claims to the probate

court, thus procuring distribution to himself outright.

*This is the issue as to which petitioner asserts he has never had

his day in court. We shall show, by adequate record citations,

that the issue has been present from the beginning, to the knowl-

edge of petitioner and his counsel.

minors RRR OTE =r a

ee al

Judgment going against him, petitioner appealed and

relied most strongly upon the proposition that the decree

of distribution was res adjudicata and as such could not

be avoided except for extrinsic fraud. (See, for ex-

ample, Vol. 10 herein, Apps. Reply Brief in 2d Civil

No. 14280, pp. 3-8.)

When the case arrived in the Supreme Court of Cali-

fornia, that court held that the decree of distribution was

not res adjudicata (for want of jurisdiction in a Califor-

nia probate court to adjudicate equitable claims such as

are here involved) and, hence, the decree not being bind-

ing, there was no necessity for passing upon the sufh-

ciency of the evidence to support the findings as to ex-

trinsic fraud. [R. 302-303.] It then proceeded to hold

that upon the other facts found, and specifically the facts

concerning a collateral agreement on the part of peti-

tioner to distribute to unnamed and unascertained bene-

ficiaries, a constructive [or resulting: compare R. 299,

303] trust arose for the benefit of the heirs at law of

the decedent, namely, these respondents. [R. 302-303.]

The result is that petitioner is in reality here claiming

no more than that the California Supreme Court erred,

in the exercise of its jurisdiction under California law,

in holding that the probate decree of jurisdiction was

not res adjudicata and hence that the issue as to the

presence or absence of extrinsic fraud as a vehicle for

avoiding the decree was wholly immaterial. But what

petitioner industriously ignores is the patent fact that

the holding of the California Supreme Court (that a de-

cision upon the question of extrinsic fraud was unneces-

sary) merely emphasizes the presence from the begin-

ning of the essentials of the cause of action upon which

the respondents were permitted to recover.

RPL GROSS a IO GET OI AI IEP EOE OID EE

an aa

Ignoring, as we may, for purposes of reality, the ac-

tual order in which the issues were presented, the relative

claims of the parties were these:

1. Cause of Action predicated upon the right of heirs-

at-law to claim a resulting trust where a testatrix at-

tempts, by. collateral agreement with a devisee evidenced,

inter alia, by the will itself, to create a trust which fails

for uncertainty and noncompliance with the Statute of

Wills. See, for instance, Restatement, Trusts, § 54d,

§ 55h, § 411g.

2. Defense predicated upon finality of the probate

decree distributing absolutely to the devisee.

3. Replication in avoidance of the effect of the de-

cree, that the same was procured by extrinsic fraud.

Such was the true rationale of the issues, notwithstand-

ing the fact that respondents pleaded extrinsic fraud at

the outset which was denied by petitioner in his re-

sponsive pleadings. It is perfectly obvious, therefore,

that the primary right constituting the basis of respond-

ents’ cause of action was necessarily their right to have

a trust impressed upon petitioner as being the person in

possession of property which in equity belonged to them.

It is equally obvious that, unless they had possessed

such primary right, the question of extrinsic fraud could

never have arisen, for if they had possessed no right

capable of being violated, respondents could not have been

defrauded. It thus becomes manifest that the only func-

tion of extrinsic fraud in the case was as a vehicle to

avoid whatever effect the decree of distribution had upon

the respondents’ rights. And it follows that when the

Supreme Court, adversely to petitioner’s contentions, held

that the decree was not conclusive, due to want of juris-

seals

diction in the probate court to adjudicate the presence of

a resulting trust, the issue of extrinsic fraud became ut-

terly superfluous.

We now propose to show that not only was the issue

as to a collateral or secret agreement (evidencing an at-

tempt to create a trust which failed) present in the case

from the inception, but that petitioner knew it and at-

tempted to meet the issue, thereby clearly having his day

in court.

Il.

Petitioner Has Had His Day in Court Upon the

Issue of a Collateral or Secret Agreement to

Create a Trust and Upon Every Other Issue In-

volved in the Case, Including That of Extrinsic

Fraud.

It will be borne in mind that prior to the trial which

resulted in the judgment against petitioner, there had

been a previous appeal from a judgment rendered after

demurrer sustained to the plaintiff’s original complaint.

Sears v. Rule, 45 Cal. App. (2d) 374; [R. 260-271].

The briefs on that appeal clearly show that the issue

of the collateral or secret agreement was directly pre-

sented to, and decided by the District Court of Appeal.

The briefs in question consisted of an Appellants’

Opening Brief, a Reply Brief filed by petitioner herein,

and, after decision of the court sustaining the complaint,

a Petition for Rehearing also filed by petitioner. Certi-

fied copies of those two briefs and of that petition are

collectively filed herein as Respondents’ Exhibit “A.”

Respondents herein, in their ‘Plaintiffs’ Opening

Brief’ devoted an entire topic to the identical theory

q

er ee

upon which the judgment herein was later affirmed by

the California Supreme Court. On page 95 of that

brief (see Exhibit “A” herein) appears the following:

“POINT IV.

“PLAINTIFFS HAve A CAUSE oF ACTION EVEN IN

THE ABSENCE OF MISTAKE OR FRAUD. THE

Suit SHoutp Not Have BEEN DISMISSED.

“Even if the complaint did not allege that the

Decree of Distribution was obtained through mis-

take or extrinsic fraud, the plaintiffs still have a

cause of action, and the demurrer should not have

been sustained.

The complaint alleges the defendant took the

residue charged with a trust; it alleges he has re-

pudiated the trust and claims the entire residue as

his own. The intended beneficiaries being unnamed

and unknown, equity therefore will decree that he

holds it, not for himself, but as trustee for the

intestate heirs of the deceased . . .”

Petitioner herein, in his Reply Brief (see Exhibit A,

herein), also discussed the secret collateral agreement.

He stated:

“No attempt is made to allege a secret trust was

intended, or that the plaintiffs were the beneficiaries

thereunder, or were secretly named, or that defend-

ant made any promise with respect to such devises

or bequests.” (Exhibit A, p. 4.)

Pages 19-22 of that brief are devoted to his topic en-

titled:

“The test for the creation of a secret trust is,

First, the intention to create a trust for someone,

and, Second, the promise, express or implied, by

the legatee to carry it out.”

EERE RT LU EM SSAA EN CIS SPREE 2 BAR IY BABYS ARLE PRET TRE NORE RI TEL tT Sem ye BWR & Prigel aoe marche eS

ee

The complaint of course, does allege a secret or col-

lateral agreement.* For instance, Paragraph IX al-

leges that, as to the residue, petitioner well knew that

the said testatrix had in mind other beneficiaries than

himself and that he was not the sole beneficiary. [R.

152-153.] Similar allegations appear in Paragraph VI

of the cross-complaint of respondent Minnie Cotton. [R.

184-185.] In Paragraph VI of the complaint it is al-

leged, by reference to the will, that petitioner was made

the ‘sole beneficiary” of the estate to “distribute” it in

accordance with the “wishes” of the testatrix “often dis-

cussed” by them. The complaint prays that he be held

as trustee for the benefit of the heirs at law.

The District Court of Appeal, in its decision |R. 260]

stated the following concerning the complaint:

“The theory that the testatrix . . . intended to

convey the residue . . . to him in trust to be dis-

tributed in accordance with their previous agree-

ment, seems conclusive .. .” [R. 266.]

“Moreover it is apparent the respondent knew the

testratrix did not intend to make him the sole bene-

ficiary of her estate...” [R. 267.]

*It should be pointed out that the will itself evidenced the exis-

tence of such an agreement:

“ARTICLE FIVE.

* o * * * * * * +. *

“(b) The reason of making my brother, Charles T. Rule.

the sole beneficiary of my estate is that I am confident, and

place my trust in him to the extent, that he will distribute my

estate in accordance with my wishes he and I have often dis-

cussed.”

ae

“. . . the allegations of the complaint .. . clearly

show that it was not the intention that Charles T.

Rule should become the sole beneficiary of his sis-

ter’s will...” [R. 270-271.]

Petitioner, in his Petition for Rehearing by the Dis-

trict Court of Appeal (Exhibit A herein), stated:

“V. The court erred in holding that a secret

agreement was alleged or existed . . .” (p. 2)

“. . , the court has not sought to discover the in-

tention from the language of the will, but from the

purported agreement alleged by counsel and referred

to as a secret trust in the brief under that heading

at pages 46 to 56.” (p. 26.)

After his petition for rehearing was denied, petitioner

herein filed in the Supreme Court of California a_peti-

tion for a hearing by that court. (See Vol. 11 herein.)

On page 4 of that petition he stated:

“(2) The decision of the District Court is erro-

neous in that it is predicated upon the court’s con-

clusion that a secret agreement existed between the

testatrix and her brother, Charles T. Rule .. .”

The District Court of Appeal reversed, and sent the

case back for trial. The following references to the

record show that petitioner’s counsel were fully aware

of the presence of the issue as to a collateral or secret

agreement.

For instance petitioner himself admitted the secret

trust. He testified in part as follows:

“Q. This will, I presume, Mr. Rule, was drawn

for the purpose of trying to carry out the wishes

of Sarah Weber? ...A. Yes.”

lliiicis

Q. And you had discussed with your sister, as

stated here in the will, what those wishes were?

A. Yes.” [R. 32-33.]

* * * * * * * *

“Q. Those wishes were only disclosed to you in

conversations with your sister? A. Yes, sir, that

is correct.” [R. 37.]

* * * * * * * *

“A. He (Henry Draeger) told me . . . that my

sister had often talked about she wanted me to

distribute the estate.” [R. 5.]

* * * * * * * *

“The Court: Hadn’t Mrs. Weber, before she

died, told you about how you should divide that

property? A. Yes.” [R. 5.]

. * * * * * * *

The petitioner admitted he had, in another action,

testified as follows:

“Q. And was any explanation made of the legal

effects or legal meaning of any of the phrases used

in that will? A. I do not recall at that time.

Later Mr. Draeger went into that... .

Q. Do you recall what he explained? A. Yes,

about the trust.

Q. About everything going to you in trust? A.

Yes.” [R. 4]

. * * * * * * .

Edwin Weber, a witness testified:

“A. Oh, I asked him (Mr. Rule) what the

instructions of Sarah was to him as to the distribu-

os: NONE AHR TAGS ARG TH NET REO SION PS SM ee

—10—

tion of the estate; and he said that that was what

he knew and it was nobody else’s business.” [R. 58.]

* * * x + * * *

Mr. Warren, attorney for petitioner, in addressing the

trial court, stated in part:

“. . . the Appellate Court said there are some al-

legations in here there was a secret agreement be-

tween this Mr. Rule and Sarah Weber. Now, if

there is a secret agreement, the foundation of this

whole thing by the decision of vhis Court is that

there existed a secret agreement which was con-

cealed from the court. Now, that would take a

conversation between Sarah Weber and Charles T.

Rule...” [R. 104.]

If any further evidence were needed as to the fact that

pettiioner has fully had his day in court upon the question

of a collateral agreement as constituting the basis of re-

spondent’s right to recover, the following from the tind-

ings of the trial court is eloquent [R. 219]:

“~ . . At the death of Sarah E. Weber, Charles

T. Rule knew that Sarah E. Weber did not intend by

said will to devise and bequeath the residue of her

estate to him absolutely, and he knew that she in-

tended by said will to devise and bequeath the residue

of her estate to him in trust only, for the beneficiaries

previously agreed upon and understood between her-

self and Charles T. Rule.

“Prior to her death, Sarah E, Weber discussed

each provision of her said will with Charles T. Rule,

RTE GM KI A NEE PIL yh EAL NOR EME RE ILE LPT MERIE ETI eM a RE

wittion

and she told him the manner in which she wanted him

to distribute the residue of her estate. Charles T.

Rule agreed, and told her he would distribute the same

in accordance with her said wishes and directions.

Sarah E. Weber, when she executed said last will and

testament, and at her death, had confidence in Charles

T. Rule, and trusted that he would distribute the

residue of her estate in eccordance with her said

wishes, which she had discussed with him, and his

agreement with her.”

In respondents’ brief in the appeal after the trial of the

case, we ‘devoted pages 7 to 25, to a discussion of the

evidence supporting the finding regarding the secret trust

(see Vol. 10 herein).

Petitioner herein, in his opening brief in that appeal,

challenged the finding of the trial court and stated at page

94 (see Vol. 10 herein) :

" the alleged agreement on his part with

respect to distribution of the estate was simply non-

existent.”

Petitioner herein, in his reply brief in the appeal from

the judgment, stated the following (see Vol. 10 herein) :

“The existence of non-existence of a collateral

agreement between Mrs. Weber and Mr. Rule by

which it was agreed that he was to take the residue

of her estate as a trustee and not in his individual

right, is clearly the crux of the issue of fraud on this

appeal.” (Br. p. 24.)

SRR Se

aR Ne

It is also pertinent to add that the foregoing quotation is

taken from a section of the brief which is headed:

“C. There Was No Collateral Agreement or

Trust.”

It might also be noted that on page 28 of the same brief

petitioner has another topic entitled:

“D. The Evidence Affirmatively Established the

Non-existence of Any Collateral Agreement.”

under which he said:

“

.

. It is apparent that any evidence of dis-

cussions between them was competent and material—

not as declarations of the decedent for the purpose of

construing her will, for that would be contrary to

Section 105, Probate Code—but as competent evi-

dence to prove or disprove the existence of the col-

lateral agreement which -s essential to any possible

cause of action of the respondents.”

On page 11 of the same brief, petitioner herein stated:

In view of the foregoing uncontrovertible evidence that

the existence of a collateral agreement has always been

implicit in respondents’ recovery, it is submitted that

petitioner’s claim that the California Supreme Court “sub-

SEITE

“It thus appears that the alleged fraud falls into

two categories, first . . . and, second, the fraud

of appellant in . . . concealing his knowledge of

an agreement between him and Mrs. Weber to dis-

tribute the property according to some previous un-

derstanding.”

PSEA GRST RAT TAN PEARSE ORO ROME TET a Se

—l3—

stituted” a new and different theory and cause of action

upon which petitioner has never had his day in court is

wholly without merit. The basic issue has always been

present, and, it was, as petitioner stated in his said reply

brief “the crux of the issue of fraud’ (see Vol. 10 here-

in). The presence or absence of the issue of extrinsic

fraud depended only upon whether petitioner was right or

wrong in his contention that the decree of distribution was

ves adjudicata. The California Supreme Court held he

was wrong; and it held correctly, as we shall show in our

discussion of petitioners’ Point 2. But whether its holding

in this respect was right or wrong, no question of due

process arises, for petitioner has had his day in court ov

every issue involved in the case, including the issue of

extrinsic fraud. For this reason we have deemed it un-

necessary to discuss the authorities mentioned by petitioner

in this connection.

It might be stated in passing, that even if the complaint

herein had failed to plead the existence of the secret or

collateral agreement, as contended by petitioner, which

contention we deny, the assertions of petitioner are still

without merit. The issue of the collateral agreement was

tried and findings were made with respect thereto, and,

as the Court stated in Martin v. Imbrie, 262 Fed. 44-47:

“Effect must therefore be given to the rule that

where the parties, with the assent of the court, united

in trying a case on the theory that a particular matter

is within the issues, that theory cannot be rejected

when the case comes up for review.”

ae ~

a THHEME LEG ENTE Be RE Th ae

‘cll

(See, also to the same effect: San Juan Light Co. v. Re-

quena, 224 U. S. 89, 32 Sup. Ct. 399, 56 L. Ed. 680;

Fleishacker v. Blum, 109 F. (2d) 542, cert. den. 311

U. S. 665; Lyons v. Empire Fuel Co., 262 Fed. 465; Houle

v. Helena Gas & Elec. Co., 31 F. (2d) 671; Bjornquist v.

Barton & A. R. Co., 250 Fed. 929, cert. den. 248 U. S.

593.) The same rule obtains in California. (Peck v.

Noee, 154 Cal. 351; 2 Cal. Jur. p. 240, citing many cases.)

Section 4% of Article VI of the Constitution of Cali-

fornia provides in part the following:

“No judgment shall be set aside, or new trial

granted in any case, . . . for any error as to any

matter of pleading . . . unless, after an examina-

tion of the entire case, including the evidence, the

court shall be of the opinion that the error complained

of has resulted in a miscarriage of justice.”

It is also pertinent to add, that, the existence of the

secret or collateral agreement having been proved and

found, even if the theory of law upon which the Cali-

fornia Supreme Court affirmed the judgment differed

-from that of the trial court, that still petitioner’s conten-

tion is without merit. It is the long established rule in

California, that:

“If the judgment or order in question is right upon

any theory of law applicable to the case, it must be

sustained regardless of the considerations which may

have moved the trial court to its conclusions.”’

Davey v. So. Pacific Co., 116 Cal. 325-329;

2 Cal. Jur., p. 809, citing many cases.

ties

III.

Petitioner Acquired No Vested Rights Under the De-

cree of Distribution, for the Probate Court Was

Without Jurisdiction to Declare the Equities

Under Which Respondents Claimed, as Held by

the California Supreme Court.

The jurisdiction of the California probate courts stems

from the Constitution and laws of that state. (Calif.

Const., Art. VI, Sec. 5; California Probate Code, Secs.

300-1242.) And here the highest court of the state has

held that the probate court had no jurisdiction to impose a

resulting trust upon property passing out of probate.

The reasons for this may be simply stated under Cali-

fornia law.

It is fundamental California law that all questions re-

lating to trusts of whatever nature are, in the absence of

statute, solely and exclusively in the jurisdiction of equity.

It is equally certain that the jurisdiction of California

Superior Courts while sitting in probate has always been

in control of the Legislature. And, prior to the enact-

ment in 1889 of Code of Civil Procedure Section 1699

(now Probate Code, Section 1120) those courts, while

sitting in probate, possessed no equity jurisdiction whatso-

ever. These matters are too well settled to require the

citation of authorities, but we may refer in this connection

to Parkman v. Superior Court, 77 Cal. App. 321, 323-6;

Estate of Hubbell, 121 Cal. App. 38, 41-3; Estate of Mc-

Lellan, 8 Cal. (2d) 49, 55-6. As the Supreme Court said

in the case last cited:

“Except for that statute [Probate Code, 1120] the

Superior Court would have no authority, in the exer-

aE SS

cise of its probate jurisdiction, to hear and determine

the account presented by a testamentary trustee.”

And, as the court held in that case, the equity juris-

diction conferred by that section is only partial and incom-

plete and is strictly limited by the terms of the statutory

grant. In the Hubbell case, supra, for example, the court

held that the Superior Court, while sitting in probate,

under Section 1120 has no jurisdiction to terminate a

testamentary trust (although a court of equity undoubt-

edly has that power) because that particular element of

equity jurisdiction was not granted by that section.

It is thus clear that the only equity jurisdiction pos-

sessed by California courts in probate is that granted to

them by Section 1120, which is partial and incomplete and

cannot be extended beyond the express terms of the grant.

And that jurisdiction is limited in time, as well as in ex-

tent, by the terms of the grant. By those express terms, it

cannot be exercised until “after distribution.” It is a grant

of limited equity jurisdiction over the administration of

testamentary trusts, and it cannot be exercised until after

distribution to the trustees because until then there is

nothing to be administered by them.

“Sections 1120 and 1121 confer jurisdiction in the

Probate Court after distribution of the estate, when

the trust has been created, exists and survives the

distribution of the estate.” (Emphasis added.)

Estate of Rey, 31 Cal. App. (2d) 648, 653 (peti-

tion for hearing by Supreme Court denied May

18, 1939).

Accord:

Gillette v. Gillette, 122 Cal. App. 640, 642.

i: — “

otiiins

It follows that the Probate Court, being powerless to

impress the trust declared in this (equity) case, had no

alternative other than to distribute to appellant, the de-

visee named in the will. And, as was implicit in the hold-

ing of the California Supreme Court, the decree was con-

clusive only as to the fact that the legal title to the assets

passed to appellant, without affecting in the slightest the

right of these respondents to assert their equities in the

proper forum.

The result is that, in the eyes of equity, petitioner took

the assets, not in his own right, but subject to their being

impressed with a trust at the suit of the beneficial owners.

As a matter of fact petitioner himself admits the Probate

Court lacked the equity jurisdiction to impress the trust.

In his appellant’s reply brief in the last appeal (2d. Civil

No. 14280), he states at page 33 (Vol. 10):

“As previously stated in this brief, if there was

any collateral agreement it was a matter for cogniz-

ance by our courts of equity, but it was of no concern

whatever to the probate court.”

And petitioner in support of the foregoing statement

cited the following California cases: Prior v. Andrews,

83 Cal. App. 782-789; Curdy v. Berton, 79 Cal. 420, 427,

and Lauricella v..Lauricella, 161 Cal. 61.

Petitioner thus himself admits that he acquired no

“vested” right in the assets at all, in the sense in which

he uses the term and, hence, once again he has failed to

show a constitutional question.

As a subordinate contention under his Point 2, peti-

tioner complains of being compelled to turn over the prop-

erty to persons not claiming to be beneficiaries, and with-

ee APSA S I, SREB

ies

out inquiry as to the validity and other incidents of the

trust. At the same time, at page 29 of his brief, he con-

cedes that under settled usages and modes of procedure

he could lawfully be deprived of his rights under the

decree:

“2. Without an attack upon the decree, and pro-

ceeding upon the theory that there was a trust created

by collateral agreement:

* * * * * * * *

“(b) At the instance of heirs of the decedent upon

a judicial determination that such trust created by

collateral agreement was invalid.”

This, of course, is our case. Restatement, Trusts, Sec-

tions 54d, 55h, 411q.* Petitioner asserts, however, that

there had been no judicial determination of the invalidity

of the trust attempted to be created by collateral agree-

ment, but only as to that attempted to be created by

Article Five of the will. He thus ignores entirely the

significance of Finding XI quoted above, which clearly

indicates that the provision in the will related back directly

to, and was merely evidence of, the collateral agreement ;

and, above all, he most studiously forgets the contention

made by him in the District Court of Appeal, namely, that

the existence of the collateral agreement which was essen-

tial to any possible cause of action in the respondents. To

*And see, also, Scott on Trusts, Vol. 1, p. 312, where it is said:

“It has been held that if B agrees to hold in trust for or to

convey to some one whose identity is not communicated to B

until after A’s death, B cannot be compelled to hold for the

person intended by A; but since B would be unjustly enriched

if he were allowed to keep the property, he will be held as

constructive trustee for A’s heirs or next of kin.”

PRR LAS PGES ANE TANT ER FIA BER STF BG ERS: ELIT IPR PTET. BLY BSL LEYTE REEN _-™

er

claim, as petitioner does claim, that the provision in the

will is anything other than the collateral agreement in

attempted action, amounts to simply refusing to face the

facts.

Beyond all this, however, petitioner is in no position to

complain of being compelled to turn the assets over to

the heirs where the beneficiaries are legally unascertain-

able. He is not a faithful trustee, seeking to discharge

his fiduciary obligations to the beneficiaries. He denies

the existence of the trust, and claims in his own right.

Under these circumstances, he has no standing to complain

that the law, to avoid unjust enrichment on his part,

directs that the assets go to the complaining heirs in man-

ner and form as provided in the judgment below. He

cannot complain that property which he does not own is

awarded to another. (Estate of Bryant, 3 Cal. (2d) 70.)

For the reasons hereinabove set forth, it is respectfully

urged that the petition for certiorari herein be denied.

Respectfully submitted,

Pierce Works,

Counsel for Respondents.

Epwin J. MILLER,

Ratpn W. MILLER,

Howarp E. Forrester,

Of Counsel.