Title: Patecky v. FRIEND
Citation: 220 Or. 612, 350 P.2d 170
Docket Number: N/A
State: Oregon
Issuer: Oregon Supreme Court
Date: March 9, 1960

Affirmed as modified March 9, 1960.
*613 Wilber Henderson, Portland, argued the cause for appellants. With him on the briefs was Earl F.G. Hurlburt, Portland.
Philip A. Levin and William M. Keller, Portland, argued the cause for respondent. With Philip A. Levin on the brief were Keller &amp; Keller, Portland.
*614 Before McALLISTER, Chief Justice, and LUSK, SLOAN and DUNCAN, Justices.
AFFIRMED AS MODIFIED.
DUNCAN, J. (Pro Tempore)
Defendants appeal from a decree in equity based on findings of fact and conclusions of law of the circuit court for Multnomah county, holding that plaintiff, Blanche F. Patecky, is entitled to the entire net estate of Samuel Friend, deceased, by virtue of an oral agreement between that decedent and his former wife, Emma, whereby they contracted to leave all their property respectively to the survivor of them, and the survivor to leave all his or her property to plaintiff, their daughter and only child.
Defendant Lillian A. Friend was the second wife of and is the widow of Samuel and executrix of his estate. Defendant Jindra Bunn, unrelated to any party, is a legatee under the will. For convenience the parties other than plaintiff will be referred to by their given names.
Samuel and Emma intermarried in 1901. They worked at separate occupations for a time. From 1916 to 1922 they jointly operated stores and went broke in the latter year. In 1932 Samuel acquired the "beginnings" of Friend's Hardware Store, and Emma worked there regularly until 1943, when her health became poor. In 1944 Samuel and Emma made a partnership agreement in writing for the operation of that store for a period of 10 years under the assumed name of Friend's Hardware Store, to share equally in profits and losses. Simultaneously, Samuel executed to Emma a bill of sale covering an undivided one-half interest in the gross assets of that business. No mention was *615 made of the future disposition of this or any other property.
In March, 1944, attorney Edward A. Boyrie prepared for Samuel and Emma, at their request, mutual and reciprocal wills. On the 30th of that month the testators executed the wills before Mr. Boyrie and another witness. Copies of the wills were produced by Mr. Boyrie. Emma's original will is in evidence, but Samuel's original will was not produced. Under said will Samuel gave all his property to Emma if she survived him, but if she predeceased him, the property was given to plaintiff. Emma's will was identical, except that she gave everything to Samuel if he survived her. Emma died February 9, 1953, and her said will was probated with Samuel as executor. The estate approximated $20,000, all of which was distributed to Samuel.
Samuel, then 76 years of age, married Lillian on May 25, 1955, thereby effectually revoking the above-described will. ORS 114.130. Samuel died June 3, 1956, leaving a will which gave $3,000 to plaintiff, $3,000 to Jindra Bunn, and the remainder to Lillian. The will was admitted to probate with Lillian as executrix, and the appraised value was slightly in excess of $41,000.
Plaintiff's complaint in the case on appeal was filed February 25, 1957, and her amended complaint, on July 15, 1957. Plaintiff based her case on an alleged oral contract between Samuel and Emma, whereby each was to leave all his or her respective property to the other if the other survived, but if the other did not survive, then to leave it all to plaintiff on the death of the survivor of the contracting parties. Plaintiff makes no claim that the contract *616 was based on any consideration for services to be rendered by plaintiff to either parent.
Defendants assign as error: (1) that the evidence was not sufficient to establish the claimed contract, and (2), that plaintiff was barred from prosecuting this suit because she had made an election by seeking to have the will of Samuel construed as making her the residuary legatee and devisee, which action was allegedly inconsistent with this suit.
1. The second assignment of error will be first decided. The complaint in equity to establish the contract and the petition to construe the will were each filed on February 25, 1957. In the latter proceeding plaintiff sought only to have the will construed to the effect that she was the residuary legatee and devisee. She did not thereby seek to void the will. By the present suit she is not seeking to void the will as such, but merely to render it subject to the terms of the alleged contract. The two proceedings appear consistent, but even if deemed inconsistent, her action in seeking a construction of the will amounts only to a mistake of remedy not precluding her from seeking to establish the contract. Medford National Bank v. Blanchard, 136 Or 467, 299 P 301.
Preliminary to considering the assignment of error that the evidence was not sufficient to establish the contract, it should be stated that the principle is recognized in In re Burke's Estate, 66 Or 252, 256, 134 P 11, that:
At the trial plaintiff testified on direct examination as follows:
Albert Patecky, husband of plaintiff, testified that late in '47 or early in '48 when they and Samuel and Emma were present the following conversation took place:
Mrs. Newman, sister of Emma, testified that on the day of and following Emma's funeral she and another sister, Mrs. Jermanis, were at Samuel's house, and during their conversation with him Samuel said:
Mrs. Stecklein, a niece of Emma, testified concerning a conversation taking place with Samuel at his home during the 1944-45 holiday season when she and her husband and Samuel and Emma were present, as follows:
Mrs. Jermanis, sister of Emma, testified concerning the conversation referred to by Mrs. Newman as follows:
2. The foregoing evidence was objected to by defendants as being hearsay. The trial court properly admitted it as being within the purview of ORS 41.850. The trial court expressly disregarded evidence of statements made by Emma out of the presence of Samuel.
The defense called but one witness, being Earl F.G. Hurlburt, the attorney who drew the will of Samuel which is in probate. He testified that Samuel told him he had no other will.
3, 4. The foregoing evidence, together with the evidence of the mutual and reciprocal wills by Samuel and Emma, is deemed sufficient to establish the making of the oral contract contended for by plaintiff. Mutual and reciprocal wills by a husband and wife do not necessarily establish they have acted pursuant to any agreement, but may be considered in determining whether in fact they were executed pursuant to a *624 contract. Taylor v. Wait, 140 Or 680, 684, 14 P2d 283. This case also holds that a promise to make a will is consideration for a promise to make a will in return.
5. The contract having been established, it remains to determine its effect on the rights of Lillian as the widow of Samuel. There is no evidence that Lillian, prior to Samuel's death, had knowledge of the contract between Samuel and Emma, nor of their wills, and it is assumed she was until then in ignorance thereof. None of the Oregon cases cited relative to the effect of contracts to make mutual and reciprocal wills in a certain manner involved the rights of a spouse by a later marriage to the survivor of the two contracting parties. Specific performance of a contract is not a matter of right in equity, but is more a matter of grace resting in the sound discretion of the court, controlled by equitable principles. Wagner v. Savage, as Adm'r, 195 Or 128, 149, 244 P 161; and Perez v. Potier, 179 Or 123, 150, 170 P2d 343. The cases in other jurisdictions cover many phases and variations of the general question. Baker v. Syfritt, 147 Iowa 49, 125 NW 998, took the extreme view that a husband contracting with his wife to dispose of their property in a certain way thereby parted with any heritable interest. As a consequence, his surviving wife of a later marriage could take nothing, and the decision further stated that the same rule would apply to a child, if any, of the latter marriage. However, there the contract was contained in a joint will which was probated following the death of the first wife, and the second wife thereby had at least constructive notice prior to her marriage.
Bedal v. Johnson, 37 Idaho 359, 218 P 641, went further in the other direction by holding such a contract *625 void as to a subsequent wife of the contracting husband who had no knowledge of the contract prior to her marriage. The view taken was that under such circumstances the contract was against public policy.
In re Arland's Estate, 131 Wash 297, 230 P 157, appears to be a leading case, often cited. In 1911 Charles and Mary Arland, husband and wife, made a written agreement concerning all their property belonging to the community. Pursuant thereto, each executed to the other a warranty deed to all the property, and the contract provided that such deeds should have the effect of vesting the survivor with the entire title. The deeds were placed in escrow. They further agreed that the survivor would immediately on the death of the other make a will giving all property to the children of the parties. Mrs. Arland died within a year, and Mr. Arland obtained from escrow the deed to himself. About four years later he remarried and lived about another six years. He did not make the will as agreed with his first wife, but did leave a will giving his second wife a one-third interest in his estate, with the remainder to his children by the first wife. Before her husband's death the second wife had no knowledge of the written agreement. The trial court upheld the terms of the will, and this was affirmed on appeal, where the Supreme Court stated:
*626 Owens v. McNalley, 113 Cal 444, 45 P 710, cited in the Arland case but not identical as to facts, is applicable. McNalley, a bachelor, orally contracted with a niece to come to California and care for him, in return for which he would leave her all his property. She had performed for about 12 years when McNalley married. At his death he left a will giving his property to his wife. The wife had no knowledge of the contract until after her husband's death. The appellate court affirmed the trial court in denying relief to the niece in a suit for specific performance and said in part:
6-10. We are faced with the question of whether the court can enforce the contract in part  that is, under the situation in this case by compelling a conveyance and transfer from the estate to plaintiff of all property not accruing to the widow by virtue of the statute.
The general rule is stated in Public Market Co. v. Portland, 160 Or 155, 162, 83 P2d 440, to be:
*627 There are exceptions to the general rule apparently intended for the benefit of the party seeking the relief. Oregon recognizes that a purchaser of land may take less than the quantity bargained for. Bartholomew v. Bason, 188 Or 550, 214 P2d 352. Volume 2, Restatement of Contracts 638, § 359(2), states that the decree need not be absolute in form and the performance that it requires need not be identical with that promised in the contract; it may be drawn so as to best effectuate the purposes for which the contract was made, and it may be granted on such terms and conditions as justice requires. See 81 CJS 446, Specific Performance § 21, to the same effect. Marriage being a natural and desirable relationship in the eyes of the law, it may be said that the possibility of remarriage of either Samuel or Emma was within their contemplation when the contract was made and became a part thereof. At least, it may not be assumed that they intended an agreement in restraint of marriage.
It may be assumed that plaintiff would prefer to take from the estate a part of the property contracted for than to take none. If relegated to an action for damages for breach of contract, her recovery would likewise be subject to the widow's statutory benefits.
Under the circumstances revealed by the evidence it is deemed equitable to allow Lillian Friend only the rights reserved to her by statute as widow of the deceased and to allow plaintiff the remainder of the estate property in pursuance to the contract. Plaintiff did not pray for partial performance of the contract if full performance could not be had, but the equity court can nevertheless so provide. Caveny v. Asheim et al, 202 Or 195, 221, 274 P2d 281.
Defendant Jindra Bunn cannot take under the will. She had no rights distinct from the will, and plaintiff's *628 rights under the contract take precedence so far as Jindra is concerned. Lillian Friend, as executrix, was duty bound to defend on trial and on appeal and she should be allowed attorney's fees and disbursements from the estate for such defense.
Under the law and the equities existing it is deemed that the decree in the circuit court is modified as follows:
(1) To allow defendant Lillian Friend the sustenance and support out of the estate as authorized by ORS 113.070 and ORS 116.015;
(2) To set aside to Lillian all the property of the estate exempt from execution pursuant to ORS 116.010; provided that she is permitted to elect whether to receive the homestead exemption or to have dower in the homestead property;
(3) To allow her dower in any real property other than the homestead as provided by ORS 113.010;
(4) To allow her out of the estate funds a reasonable attorney fee for defending this suit in the trial court and on appeal, together with her necessary disbursements on trial and on appeal.
Affirmed as modified.