Title: Matter of Estate of Garwood
Citation: 400 N.E.2d 758
Docket Number: 280 S 26
State: Indiana
Issuer: Indiana Supreme Court
Date: February 5, 1980

400 N.E.2d 758 (1980)
In the matter of Estate of Martha Ellen Garwood, Deceased.
No. 280 S 26.

Supreme Court of Indiana.
February 5, 1980.
William S. Spangler, Jon F. Schmoll, Gary, Charles S. Siferd, Monticello, for appellant.
Phillip J. Badell, Rushville, David Dellinger, Monticello, George Wildman, Logansport, for appellee.
PIVARNIK, Justice.
This case comes to us on a petition to transfer from the Fourth District Court of Appeals. Transfer petitioners were the appellants in the Court of Appeals and were heirs of the estate of Martha Ellen Garwood in the trial court.
The last will and testament of Martha Ellen Garwood, Deceased, was admitted to probate in the White Circuit Court on June 5, 1970. On that date, Paul J. Garwood, son of the deceased, and Lawrence Sommers, son-in-law of the deceased, qualified as co-executors of the estate.
On March 8, 1971, Dean Garwood, one of the heirs and also a son of Martha Ellen Garwood, filed a petition to set aside a contract for the sale of estate property. The contract, which had been entered into *759 on November 10, 1970, purportedly sold the real estate in question in this appeal to co-executor, Paul Garwood. The contract was entered into between Paul Garwood, individually, and Paul Garwood and Lawrence Sommers as co-executors. Thereafter, Paul Garwood filed a motion to dismiss the petition to set aside the contract alleging, inter alia, that the sale was not conducted as an estate sale under the terms of the probate code, or by order of the probate court, but was a direct sale by the executors under a testamentary power. Previous to the time that Paul Garwood filed his motion to dismiss the petition to set aside the contract, he moved for appointment of a special administrator and the court appointed one Marvin Stewart. On April 13, 1971, special administrator Marvin Stewart requested authority to convey the subject real estate to Paul Garwood pursuant to the terms of the contract of November 10, 1970, upon receipt of the balance of the purchase price. The property had been appraised at $92,200. The contract provided that Paul Garwood was to pay the sum of $92,001, with a down payment of $501 and further provision for the payment of the balance. Along with the special administrator's request to convey the subject property, was a petition to dismiss the petition of Dean Garwood to set aside the contract of sale. The court, on that same date, entered an order authorizing the special administrator to execute a deed conveying the subject real estate to Paul Garwood upon receipt of the balance of the purchase price. Subsequently, on June 29, 1971, the other co-executor, Lawrence Sommers, moved to expunge the court's order of April 13, 1971, which authorized the special administrator to convey the property, alleging, inter alia, that there had been no notice of hearing on the special administrator's petition for authority to convey the property and that no hearing had been held on the petition of Dean Garwood to set aside the contract. The court sustained this petition of co-executor Lawrence Sommers and entered an order expunging its previous order of April 13, 1971.
Some questions were raised as to the authority of Marvin Stewart to serve as special administrator and he resigned as such on December 17, 1971. The court entered an order removing Paul Garwood as executor of the estate on April 25, 1973, due to his adverse interest with respect to the estate which had to do with this contract, the fact that he filed a claim against the estate in December, 1970, and the fact that he filed a contest to the will. On May 16, 1973, the court dismissed the pending petition to set aside the contract for sale of the subject realty. However, on May 30, 1973, the Court entered an order determining that among the issues remaining in the estate was that of the contract of purchase of real estate by Paul J. Garwood. Lawrence Sommers resigned as co-executor on September 7, 1973, and the court appointed Paul D. Ewan as administrator with the will annexed.
On November 28, 1973, Paul Ewan, as successor personal administrator, filed the petition to determine the rights of possession and title to the subject real estate. Paul Garwood filed a motion to dismiss this petition on March 20, 1974. Subsequently, the Honorable Maurice T. Zerface, disqualified himself as judge in this cause and the Honorable Norman L. Kiesling was appointed Special Judge.
On December 13, 1974, Frances Rose Garwood, Dorothy M. Sommers and Zora Fae Swing, filed objections to the November, 1970 contract for sale of the subject realty. Their objections were stated as follows:
As indicated in these objections, these parties are all heirs of Martha Ellen Garwood. On May 14, 1975, the trial court heard the petition and objections filed against the contract in question and made and entered the following judgment:
Following this judgment the appellants filed a motion to correct errors which was overruled by the trial court. The appeal was perfected to the Fourth District Court of Appeals and on November 30, 1978, the Court of Appeals rendered a decision, sua sponte, dismissing the appeal on the grounds that the trial court's decision was not a final appealable judgment. In re Estate of Garwood, (1978) Ind. App., 382 N.E.2d 1020. The Court of Appeals determined that the decision of the trial court was, in fact, an interlocutory order and that, therefore, pursuant to Ind.R.App.P. 3(B) the appellants were required to file the record with the Clerk of the Court of Appeals within thirty (30) days of the ruling on the interlocutory order. Since the appellants treated the decision as a final judgment, their pursuit of remedies by their filing of a motion to correct errors and then proceeding to appeal resulted in extending the time of filing the record beyond thirty days. There was no question raised by the appellants or the appellees in any of the issues presented to the Court of Appeals in their briefs as to the nature of the entry of the trial court being an interlocutory order rather than a final appealable judgment. The Court of Appeals interpreted this entry to be an interlocutory order rather than a final appealable judgment and accordingly dismissed the appeal sua sponte. We find that the Court of Appeals was in error in so doing and therefore vacate their opinion.
In dismissing this appeal the Court of Appeals relied on the opinions formerly entered by this Court in Kiradlo v. Pisula, Administrator, (1952) 232 Ind. 659, 115 N.E.2d 744, and Campbell, et al. v. Union Trust Co., et al., (1949) 227 Ind. 692, 88 N.E.2d 560. Both of these cases concern authority given by the probate court to the personal representative by interlocutory order for permission to sell real estate in the estate for the purposes of paying debts and to discharge legacies given by the will. Campbell had established the general rule, followed by Kiradlo, that: "An order for the sale of real estate to make assets for *761 the payment of liabilities of an estate is an interlocutory order." Kiradlo, supra, 232 Ind. at 660, 115 N.E.2d  at 744. The sale and order in question here were not made to pay liabilities of the estate. That would be interlocutory to the extent that any sale proposed by the personal representative in compliance with that order would have to be approved by the court. This procedure would give any parties an opportunity to appear before the court and to present arguments and evidence as to the propriety of accepting a particular sale and purchase which would then be followed by a court's order of sale and delivery of deed upon delivery of purchase price, if the court, did, in fact, approve the particular sale. In the case before us, the court heard all the parties on the issue of approving the sale on the contract entered into and approved said sale, ordering a delivery of deed and payment of purchase money. Appellant's argument is well taken that this was a judgment of the court on one issue in the case, which was separate and distinct from the administration of the estate in all other matters, making the order a final and appealable judgment on that issue. We therefore must disagree with the statement in the concurring opinion of the Court of Appeals that: "Our discretion to remand to the trial court under T.R. 54(B) should not be exercised here because the nature of the case makes it one that we could best review on the merits if the entire case were before us," and agreeing with the majority's decision to dismiss the appeal. In re Garwood, (1978) Ind. App., 382 N.E.2d 1020 at 1023 (concurring opinion). The difficulty in accepting this conclusion is that the merits of the entire case on this issue are before us. All that remains to be done on this judgment is the perfunctory following of the court's orders in delivering the deed and in paying purchase money. The only things remaining to be done then are to have the proceeds put into the estate and distributed to the heirs on final distribution. The issue of this sale will not come before the trial court again.
In Richards v. Crown Point Community School Corporation, (1971) 256 Ind. 347, 351, 269 N.E.2d 5, 6, we considered a ruling by the trial court which provided:
We found in Richards that this was a final appealable judgment, as follows: "In the case at hand the separate and distinct issue of who has the fee simple title to the land in question has been decided by the trial court's grant of summary judgment. Being a final order as to the issue ruled upon, the proper procedural approach was appeal to the Appellate Court by way of a motion to correct errors." Richards, supra, 256 Ind. 347, 351, 369 N.E.2d 5 at 7. In Richards, we cited with approval Smith v. Zumpfe, (1940) 217 Ind. 431, 27 N.E.2d 878, in which we found that an order for the sale of real estate with the trial court reserving the jurisdiction to refuse to confirm a transfer made pursuant to the order, was an interlocutory order and not final. The reason for the holding in Smith, supra, was the retention of the power in the court to deny validity to the resulting sale. Smith further noted that it is the character of the relief granted that determines its classification as final or interlocutory. It had been further stated in Zumpfe v. Piccadilly Realty Company, (1938) 214 Ind. 282, 13 N.E.2d 715, that: "A final judgment from which an appeal will lie is one which determines the rights of the parties in the suit, or a distinct and definite branch of it, and reserves no further question or direction for further determination. Applying this test *762 we are constrained to hold that the order entered by the court in the instant case constituted an appealable final judgment. It amounted to more than a mere direction to the receiver. It adjudicated that appellants were not entitled to an order of sale of the real estate involved under their cross-petition, to which answers had been filed by the parties in interest, thereby forming an issue for the determination [by] the court."
In Inheritance Tax Div. v. Estate of Calloway, (1953) 232 Ind. 1 at 8, 110 N.E.2d 903, at 906: "A `judgment or decree' has been defined as the final determination of the rights of a party in an action; and an `order' generally, is a direction of the court preliminary and incidental to final determination. The distinction between an order and a judgment is one of finality, and the question is whether the order is a final determination of the rights of [the] parties."
The ministerial acts of receiving the money and delivering the deeds do not affect the finality of the judgment. These are acts performed by the parties pursuant to the judgment of the court. It is apparent that any judgment entered by a court which requires only the execution of it, and leaves nothing further for the court to decide is a final judgment. The trial court, in the case before us, declared that title and possession of the subject real estate was vested in the purchaser-appellee and that the contract of sale entered into on November 10, 1970, was valid and enforceable. The trial court ordered the special administrator to execute transfer and deliver a deed for the real estate upon payment of the balance of the purchase price, reserving no power to itself to deny the validity of the sale of the subject real estate to the appellee. This, then, was the final appealable judgment entered by the trial court on this issue in the cause and the appellants properly pursued their remedies by a motion to correct error and the appeal filed in the Court of Appeals. We, accordingly, will consider the issues on the merits.
All of the issues raised in this appeal involve the validity of a contract for the sale and purchase of realty in the estate entered into on November 10, 1970, wherein Paul J. Garwood was the purchaser and the co-executors, Paul J. Garwood and Lawrence D. Sommers, were the sellers. These facts are apparent on the face of the instrument since Paul J. Garwood signed the instrument as the purchaser and also signed his name as co-executor-seller along with Lawrence D. Sommers. It is the contention of the appellant-heirs that the contract was therefore void and the trial court should have found it so. The appellants contend further that if it was not void then it was voidable upon application of the heirs and that the record shows throughout this cause that the central issues in settling this estate were the contentions of various heirs and personal representatives and that there were objections to the contract and execution thereof, for various reasons. One reason was that Paul Garwood was a co-executor and acting in his own interest rather than that of the estate. Finally, the appellants contend that the court improperly found that there was sufficient evidence to establish acquiescence in or agreement to the sale by the heirs since there was no evidence whatsoever to show a family settlement or family agreement had been reached pursuant to the 1953 probate code, which specifically sets forth the elements necessary to establish such agreement or settlement. Appellant further claims that the personal representatives acted under authority given by the will.
The question of the validity of the sale of estate property by the personal representative to himself was decided by this Court as early as 1859 in Martin v. Wyncoop, 12 Ind. 266. Therein, one Morris, as administrator of the estate of Pierce, sold certain estate property to himself. Morris then sold the property to Martin. There was no testimony of any fraud or unfairness in the sale from Morris as executor to Morris individually as purchaser. On the contrary, the proof was that Morris tried to induce competition and wanted to sell the estate property *763 for the highest price. The trial court ordered the conveyance from Morris, as executor-vendor, to Morris, individually as purchaser and from Morris to Martin to be set aside. Martin appealed from that order. Affirming the action of the trial court, this Court stated:
12 Ind. 266, 268. The decision held that the fact that the sale was at a public auction conducted by a third person did not validate the executor's sale to himself, and therefore, the trial court properly set aside the conveyance.
We next considered the issue in Potter v. Smith, (1871) 36 Ind. 231. Here, Potter was the administrator of one Caruthers and caused real estate to be sold at public auction in all respects in accordance with the probate law and the orders of the probate court. At the auction, however, Smith purchased the property with money that had been given to him by Potter, so that Smith could purchase the property for Potter. The agreement between the two was that subsequently Smith would convey the property to Potter when Potter requested it. Before this could be done, Potter died. Smith later conveyed the property to Potter's widow and children. On a suit by the heirs of Caruthers to regain title and possession of the land, the court found that the heirs had a right to have the sale set aside. This Court stated in Potter, supra:
36 Ind. 231, 238-240.
Thus it has been the settled law of Indiana since its beginning, that a probate personal representative of the deceased is a trustee of the estate assets and will not be permitted to purchase the property himself as an individual from himself as the personal representative. The reasons for this were clearly and eloquently stated in the above cases as we have set them out to be for the purpose of preserving the integrity of the corpus of the trust and preventing any possibility of any wrong. This was true even though in Wyncoop, supra, the personal representative bought at public auction and in Potter, supra, that a sale by a trustee, administrator or representative to himself was not apparent on the face of any of the deeds or records in the estate. In the cause before us, it is apparent since the very contract and the contemplated deed in execution thereof provide for Paul Garwood's conveying from himself in the person of the personal representative as seller to his own person as an individual as purchaser.
We see nothing in our law since Wyncoop and Potter which changes this principle. We see no sound reason presented to us by any of the parties for changing it now. The fact that it has not been presented to us for these many years could reasonably be interpreted as an acceptance and approval of the soundness of the rule. See I Henry's Probate Law and Practice 5th Ed. Pub. 1946, §§ 271 and 272. Further, the 1953 Probate Code did not provide for a change of this principle. The only provision in the 1953 Probate Code that provided for a settlement of Ind. Code conflicts between the heirs in a distribution of the property are §§ 29-1-9-1, 2 and 3, (Burns 1972) which provide for family agreements. These sections of the probate code provide as follows:
These statutes contemplate the submission to the court of terms of compromise agreements by the heirs and beneficiaries with the personal representatives and trustees as to the distribution and disposition of the assets of the estate. It is apparent also that the statutes contemplate that the disposition and distribution of the assets may be done in such a manner as to depart from the normal procedures provided for in the probate code without such agreements. This is apparent from the last line of 29-1-9-3, which provides: "Upon the making of such order and the execution of the agreement, all further disposition of the estate shall be in accordance with the terms of the agreement." We have set the sections out in toto, however, so that it might be observed that the code carefully provides that the compromise must be in writing and must be executed by all competent persons having interest or claims or those which may be affected by such compromise and further provides for notice and/or representation of all those who might be affected but who cannot be given actual notice or recognition for some explainable reason. The sections clearly provide further that this compromise agreement must be submitted to the court, which must find that all interested persons are represented and did enter into the agreement, and which must find that the contest or controversy is in good faith and that the effect of the agreement upon the interest of persons represented by fiduciaries is just and reasonable, *766 and only then can the court make an order approving the agreement and directing its execution.
It is the contention of the appellees here that the court was authorized in approving the contract in the case before us because the facts presented to the court were consistent with the provisions of these sections of the statute. Appellees' argument must fail on this issue. Although we do not weigh the evidence presented to the trial court and attempt to second guess it or reweigh that evidence to arrive at a differing conclusion from the court's determination, we must, at any rate, examine the evidence to determine if the minimum requirements were met to comply with the statutory law. The evidence here showed that at least some of the heirs had family meetings prior to the execution of this contract in which they discussed the disposition of this real estate. At one of these meetings it was indicated that Paul Garwood would be given the opportunity to purchase the property if he outbid Dean Garwood. Although it was apparent by those testifying that all of the heirs present were aware of this arrangement, there is no showing that all of them took part in and agreed to it. It is uncontroverted that no agreement was ever reduced to writing and executed by all competent interested persons. Furthermore, the evidence showed that two of the heirs, Frances Rose Garwood and Zora Fae Swing, were not present at the meeting in which these discussions were had. There is no evidence that at any time all of the interested parties came together as the statutes contemplate and reached a compromise or agreement that could be submitted to the court for its approval. Following the meetings above indicated, a contract was entered into without it being referred to any of the heirs in any way, and providing that Paul Garwood was to pay $501 down and a total amount for the property that was in an amount less than that submitted by Dean Garwood in his original offer. This was later claimed to be a typographical error which was to be corrected to make Paul Garwood's bid $1 over that of Dean Garwood's earlier offer. This sequence of events cannot be termed a submission to the court of a compromise family agreement under our statutes since it does not show on its face that it meets the requirements set out in those statutes. The record before the trial court at the hearing clearly showed that this contract provided for the sale and purchase of the property and showed an execution of that contract only by Paul Garwood as purchaser and Garwood and Sommers, co-executors, as sellers. At the time of the trial of this issue the record contained a motion by one of the heirs to set aside the contract, a motion by Paul D. Ewan, Special Administrator, to determine the right of possession and title to real estate, and objections by three of the heirs as to the approval of said contract. There was no showing to the court sufficient to justify it in finding that there had been an agreement by the parties involved to have the property sold to Paul Garwood as a family agreement under the sections of the statute we have quoted above. Paul Garwood cannot be considered a good faith purchaser as he was fully aware during these transactions, of the problems and conflicts in his claiming title. There was insufficient evidence presented for the court to find that any of these heirs had waived the objections they now make in regard to the execution of the contract as there is no showing that they were ever in a situation which required them to take a position as to the existence of the contract or their agreement or disagreement with its terms. The record clearly shows that the execution of this contract and the conflicts that arose from it were apparent throughout the administration of this estate. The first time the issue had been presented to the court when all parties were given an opportunity to be heard on the issues tried in this regard was in the hearing before us now, in which the court made its order of April 30, 1975. The evidence is thus insufficient to sustain a finding of a family agreement.
Appellant further claims that provisions of our statute, Ind. Code § 29-1-15-19 *767 (Burns 1972) has application here. This statute provides:
This statute does not apply to the facts here. The provision in the will to which the appellees refer gave the co-executors authority to sell the residue and remainder of the estate at private or public sale and at such time or times and for such price or prices as may seem to them in the best interest of the estate. There is no showing then that the personal representative acted in substantial conformity with the terms and conditions of the power given by the will, since there is not even an inference that the testator had in mind that the property was to be sold to co-executor Paul Garwood. Had there been such language in the power or had the facts showed compliance with the family agreement sections, the appellee's arguments might have had merit. The question as to the validity of the contract here is more than an irregularity or defect contemplated by § 29-1-15-19. We are dealing here with a contract which, at its inception, was void, or at best, voidable.
Since this contract shows on its face that it was executed by improper parties under our law and since there was no showing that it was done as a family settlement or agreement in compliance with the provisions of the probate code, which would have made it voidable, the trial court should have found that this contract was void.
We accordingly remand this cause to the trial court to correct its judgment consistent with this opinion. Judgment accordingly.
All Justices concur.