NO. 84-92

INTHE SUPREME COURTOF THE STATEOF MONTANA

1.984

- DONA B. PETERSON, Plaintiffand Respondent,

-vs

### .- DONNA KABRICH, Defendant andAppellant.

APPEAL FROM: District Court 

### of the Tenth JudicialDistrict, Inand for theCounty of Fergus, TheHonorable Peter L. Rapkoch,Judgepresiding.

COUNSEL OF RECORD:

ForAppellant: Torger 

### S. Oaas argued,Lewistown,Montana

For Respondent: CraigR. Buehler argued, Lewistown,Montana

Submitted: September 20, 1984 Decided: November 28, 1984

Clerk

### Mr. Justice L. C. Gulbraildson delivered the Opinion of the Court.

Donna Kabrich appeals from an order of the Tenth Judicial District Court, Fergus County, directing her to transfer title to certain real property in Fergus County, Montana, into the name of the respondent,Dona Peterson. We affirm the decision of the DistrictCourt. The respondent, Dona Peterson, is a retired school librarian living in El Paso, Texas. She is a widow, and her immediate family at the time this action accrued consisted of her sister,Etta Trankle,and three nephews. DelKabrichwas
one of these nephews, and the son of Etta Trankle. The appellant, Donna Kabrich, was married to Del Kabrich. Sometime afterher husband died in 1978,respondentadded Del Kabrich's name to a joint tenancy signature card for her checkingaccount,number 726-015-8,at First State Bank in El Paso,Texas. Petersonmailed the signature card to Kabrich, who signed it and returned it by mail to Peterson. Thiswas apparently done in hopes of facilitating the administration of her estate upon her death. Respondenthad designated Del Kabrich the administrator of her estate in her will because he had a law degree and business experience. All of the money in account 726-015-8 was deposited by the respondent, who also exercised exclusive controlover the account. The Kabriches rented a home in Lewistown,Montana. 

### In June of 1980, Del and Donna Kabrich were advised by their landlord in Lewistown, Montana, that theymust eitherbuy the home theywere renting,ormove out. TheKabriches discussed their predicament with the respondent,and on June 24, 1980, respondent transferred $10,000 from account number 726-015-8 to Del Kabrich, which was used as a down payment on theproperty. The balance of the purchase price, $20,000, was transferred from the account on July 10, 1980, to Del Kabrich. Title to the Lewistownproperty was transferred to Del and Donna Kabrich. On July 15, 1980,respondent advanced

an additional $4,200 to the Kabriches for the purpose of making improvements on the property. There is no written agreement concerning the nature of the transfer between respondent Peterson and her nephew, Del Kabrich. The only written evidence of the transaction consisted of two letters allegedly written by DelKabrich. The first, dated January 10, 1981, is a typewritten note allegedly from Kabrich to his mother, Etta Txankle, acknowledging the transfer as a loan from respondent. It is signed simply "Jr.", Kabrich's nickname. A handwriting expert for the defendant-appellant concluded the letterwas a forgery after defendant entered the letter into evidence. The second letter, acknowledged to be handwritten by Del Kabrich to his aunt, the respondent, detailed the financial status of the Kabriches as of February 19, 1981. The letter ended by tendering a $500 payment to respondent, although no mention wasmade of any loan. In September, 1981, Del Kabrich died. Title to the Lewistownproperty passed to Donna Kabrich alone. Respondent made severaldemavds of appellantto the effect that shemake

some arrangement to repay the $34,200 transfer, alleged by respondent to be a loan. Appellant resisted, maintaining that the transfer was a gift. On April 28, 1982 the respondent filed an action against appellant in District Court, alleging that the entire transfer of funds from her checking account to purchase the Lewistown property was a loan, which appellant had refused to acknowledge or repay.The prayer requested a decree ordering Kabrich to transfer title in the FergusCounty property to Peterson. A trialwas held on September 19, 1983, before the Honorable Peter Rapkoch, sitting without a jury. On November 18, 1983, the court entered its findings of fact and conclusions of law. The court found that gift was intended the transfer, that a resulting trust had arisen in favor of the plaintiff, and that plaintiff was entitled to have the property transferred into her name. On the same day, the court issued its order requiring Donna Kabrich to transfer

C tit1.e in the Lewistown property to Peterson, and from this orderKabrich appeals. The first issue raised by appellant is whether the District Court erred in failing to find that the transfer of funds from Peterson to Del Kabrich was a gift under Montana law regarding joint tenancybank accounts. Appellant contends thatunder Montana law, the addition of Del Kabrich's signature to the signature card for Peterson's checking account created a gift of themonies held in that account. In order to constitutea gift, the addition of a party's signature to a bank account signature cardmust satisfy all the requirements of a gift inter vivos: (1) delivery; (2)donative intent; (3) acceptance by the donee. State Board of Equalizationv. Cole (1948), 122Mont. 9, 14, 195 P.2d 989, 992. Thus the question here is whether Peterson intended to make a gift of the funds inher checking account when she added her nephew's name to the signature card. The language on the signature card is quoted below: "I or we in making this deposit and at all times in doing business with this bank, specifically agree to all of the terms and conditions printed on the reverse sidehereof.

### "The above entitled joint account depositedby us,or eitherof us,and all moneys credited to the same, or heretofore or hereafter credited, is by mutual agreementpayable to either of the undersigned,or the survivoror survivors of them. The receipt or acquittance by any one of the undersigned, to whom such payment is made, shall be valid and sufficient release and discharge to said bank forallpaymentsmade." It is true, as appellant argues, that Montana cases have held that "signing a signature card containing an agreement that the deposit is payable to either of the co-depositors or the survivor settles the question of donative intent to make a joint tenancy." Casagranda v. Donahue (1978), 178 Mont. 479, 483, 585 ~.2d 1286, 1288; Cole, 122Mont. at 15, 195 P.2d at 992. However, when the donor-depositor raises the issue of donative intent during his or her lifetime, the language on the signature cards is not conclusive evidence that a gift was intended. Anderson

v. Baker (Mont. 1982), 641 P.2d 1035, 1038, 39 St.Rep. 273, 276-77. InAnderson, the donor added her son'sname as joint tenant to a savings account and two certificatesof deposit, and delivered the passbook and certificates to him. Later, shedemanded their returnand her son refused to comply. The donor filed a complaint praying for the return of the documents and for the removal of her son's name from them. Both sides moved for summary judgment and the trial court awarded each one-half of the total amount on deposit. The donor appealed, and in reversing the district court this Courtheld as follows: 

### "[Wlhere

# . .. a depositor during his or her lifetime raises the issue of ownership of funds in a joint tenancy account, the statements on the signature card are not conclusive and additional evidencemay be examined to ascertain the true intentof the parties

# . .

# .

# ".

. . We are also mindful that the signature cards are forms containing language drafted by the depository institution. While the 1a.nguagethereon may very well describe the agreements between the depositor"andthe depository, it can hardly be expected to accurately express the intentions and relationships between the joint tenants aboutwhich the depository typically has little, if any knowledge. Where thedonor-depositor,as in the instant suit,indicates during her lifetime that her intent is other than that revealed on the signature card, we hold such evidence admissible." Anderson, 641

### P.2d at 1038, 

### 39 

### St.Rep. at 276-77. 

### Here, thedonor is still alive,and testified at length at trial. She testified that by having her nephew sign the signature card, she hoped to promote an uncomplicated administration of her estate following her death. This hope

was based onher belief thatDelKabrich had greater business and legal experience than any other of her close relatives. In addition, Petersonemphatically testified that none of the money was intended a.sa gift. Rather, it was considered a loanwith expectationof repayment. Peterson's understanding in 

### this regard was based to a certain extent on an earlier loan from her to Kabrich, made when he mustered out of 

### the armed forces. That loan,used to purchase an automobile,was repaid in fullby Kabrich. Peterson also presented testimony that she had loaned money to another nephew to purchase real estate under a similar arrangement, i.e. there was no writing formalizing the loan,the debtor nephewhaving simply agreed to repay the money as he was able. This loan was being repaid according to the oral agreement, and Peterson testified that she expected the same result when she transferred funds to Del Kabrich to purchase the Lewistownproperty.

### The Anderson rule clearly applies here. We find that the additionof DelKabrich's signature to the signaturecard of Peterson's checking account is insufficient evidence to

overcome Peterson's testimony that there was no donative intent tomake agift. The appellant'ssecond issue iswhether the transferof funds from the respondent to her nephew,DelKabrich,raised

apresumption that the transferwas intended as a gift. Section 72-24-104, MCA 

### provides: "When a transfer of real property is made to one person and the consideration thereof is paid by or for another, a trust is presumed to result in favor of the person by or for whom suchpayment is made.

### "This presumption, however, is supplanted by a rebuttable presumption of gift in those cases where the parties stand in close relation to one another, such as husba.nd.and wife, or parent and child. Platts v. Platts

(1959), 134 Mont. 474, 480-81, 334 P.2d 722, 727; Clary v. Fleming (1921),60Mont. 246, 198 P. 546. We have refused to extend the presumption to more distant relationships than those mentioned above. See Detra v. Bartoletti (1967), 150 Mont. 210, 433 P.2d 485 (denyingextension ofpresumption of gift to the unexplained transfer of property between siblings)

# . However, the appellant argues that Peterson stood 

### - in loco parentis to Del Kabrich, and that relationship should. trigger thepresumption of gift. The trial court specifically found that no 

### -- in loco parentis relationship existed between Peterson and Del Kabrich. The trial court's findings will not be disturbed when supported by substantial evidence. Poepping v. Monson(1960), 138Mont. 38, 43, 353 P.2d 325, 328. Here, therewas ample evidence upon which the trial court could base its finding. In order to stand in loco parentis to another, a 

### -- person must intentionally assume the status of a parent by accepting those responsibilitiesand obl.igationsincident to the parental relationship without benefit of legal adoption. Fevig v. Fevig (N.M. 1977), 559 P.2d 839, 841. See also In

re Marriage of Allen (Ct.App.Wash. 1981), 626 P.2d 16, 21; Workmanv. Workman (Okla.1972), 498 P.2d 1384, 1386. Evidence before the District Court indicated that although Petersonwas close to all three ofher nephews, she

never assumed any parental obligations toward Del Kabrich. Their relationshipwas limited 

### to occasional visits and the excha.ngeof letters and Christmas gifts. At the time the transferwas made, Del Kabrich was a grownman, and he lived 

### in close contact with his actual mother. With the exception of a loan from Peterson to Kabrich made when he left the armed forces (whichwas repaid), there is no indication in the evidence that Petersonhad ever attempted or intended to

assume the statusofparentwith respect to DelKabrich. The trial court's finding that no 

### -- in loco parentis relationship existed between.Del Kabrich and the respondentwas supported by substantial evidence,and thereforewill notbe disturbed.. Since no presumption of gift arose under the facts of this case, and because it is evident that Peterson advanced the entire purchase price of the Lewistown property while title passed to Del and Donna Kabrich, a resulting trust in favor of Peterson is presumed. Section 72-24-104, MCA; Poeppinq, 138 Mont. at 46-47, 353 P.2d at 330; First State Bank of Philipsburg v. P.lussigbrod (1928), 83 lulont. 68, 92, 271 P. 695, 704. The presumption is rebuttable, McQuay v.McQuay (19281, 81 Mont. 311, 320, 263 P. 683, 686, and the only remaining issue is whether the appellant sustained her burden of proof in overcoming the statutory presumption. Absent a presumption of gift, the appellant must establish that a gift was made by "clear, convincing, strong and satisfactory evidence

# . . .more than amere preponderance of the evidence." Detra, 150 Mont. at 218, 433 P.2d at 489. In the instant case, tne evidence offered by the appellant falls short of establishing a gift by clear, convincing, strong and satisfactory evidence. An examination of the trial transcript reveals that Peterson understood the transfer of funds to be a loan, to be repaid by her nephew and appellant as they were able. As discussed above, this understanding was based in part on prior dealings between Peterson and her nephews. Peterson also introduced into evidence without objection a February 19, 1981, letter written by Del Kabrich to her discussing the Lewistown property, detailing Kabrich's financial affairs at the time, and then tendering an unexplained payment of $500. At the trial, respondentmaintained that she understood the $500 to be a repayment on the money she advanced to pay for the Lewistownproperty. Appellant, however,maintained that the unexplained $500 payment was rather a "token of good will," and that the transfer of funds had been intended as a gift. As further proof that the transferwas originally intended to be a gift, appellant maintains that Peterson attempted to introduce a forged letter at trial, supposedly from Del Kabrich to his mother, Etta Trankle, which referred to the money used to purchase the Lewistown property as a "loan" from Peterson.Testimony duringthe trialindicated thatthe appellant and her mother-in-law had a stormy relationship. In fact, Trankle had sued appellant following her son's death to prevent appellant from ousting Trankle from the Lewistown property, where shewas residing. The record also indicates that Etta Trankle died in November of 1982, and shortly thereafter her personal representative discovered the letter, datedJanuary 10, 1981, in Trankle's purse. The letter was turned over to the attorney for Trankle's estate, Leonard McKinney. The letter

was typewritten except for the signature, "Jr.", which was Del Kabrich's nickname. In the course of his investigation, counsel for therespondent discoveredthe letterand obtained it from Mr. McKinney. He then sent copies tothe court and appellant's attorney, and notified them of his intent to introduce the letter into evidence at trial. Counsel for appellantthen retained ahandwriting expert, who on thedate of trial, confided to Peterson's attorney that he believed the letter to be a forgery. Peterson's attorney then withdrew the letter as one of plaintiff's exhibits, and counsel for appellant instead entered the letter into evidence. The expert then testified that "based on his analysis of the two characters "Jr.", the letter was a forgery. It is appellant's contention that respondent Dona Peterson attempted to present the court with a forgery, thereby indicating that she originally intended the transfer of her funds tobuy the Lewistown property tobe a gift. We note that there was no proof introduced attrial indicating any connection between Peterson and the forged Letter. And in fact, it was the appellant, and not respondent, whopresented the court with the January 10, 1981 letter. The trial court was obviously not impressed with appellant's contention in this regard, as it found a resulting trust to have arisen in favor of Dona Peterson. We are bound here to follow the conclusion of the trial judge, who had the opportunity 

### to observe the conduct and demeanor of 

### the witnesses on the stand. Poeppinq, 138 Mont. at 44, 353 P.2d at 329;McQuay, 81Mont. at 320-321, 263 P. at 686. There is substantial evidence of record to support the determination by the trial court thatno giftwasmade by the respondent in this case. Poepping,138Mont. at 43, 353 P.2d at 328. We thereforeaffirm the jud.gmentof theDistrict Court.

We concur:

# d,

# -wwdAd&J
Chief Justice

I I / Justices 

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