GA Code § 53-12-133 (2021)
2021 Georgia Code|Title 53 - Wills, Trusts, and Administration of Estates|Chapter 12 - Trusts|Article 7 - Implied Trusts|§ 53-12-133. Parol Evidence and Implied Trusts

 In all cases in which a trust is sought to be implied, the court may hear parol evidence of the nature of the transaction, the circumstances, and the conduct of the parties, either to imply or rebut the trust.    (Code 1981, §53-12-133, enacted by Ga. L. 2010, p. 579, § 1/SB 131.)   Law reviews.   - For comment, "The Georgia Supreme Court's Creation of an Equitable Interest in Marital Property - Yours? Mine? Ours!," see 34 Mercer L. Rev. 449 (1982).   JUDICIAL DECISIONS   Editor's notes.   - In light of the similarity of the statutory provisions, decisions under former Code 1868, §§ 2290 and 2291, former Civil Code 1910, §§ 3731, 3732, 3733, and 3739, former Code 1933, §§ 108-105, 108-106, 108-106.1, and 108-106.2, former O.C.G.A. § 53-12-34, and former O.C.G.A. § 53-12-94 of the 1991 Trust Act are included in the annotations for this Code section.   General rule.    - In all cases when a trust is sought to be implied, parol evidence of the nature of the transaction, or the circumstances, or the conduct of the parties, is admissible either to imply or rebut a trust. Stern v. Howell, 160 Ga. 261, 127 S.E. 776 (1925) (decided under former Civil Code 1910, § 3739). Cook v. Powell, 160 Ga. 831, 129 S.E. 546 (1925) See also (decided under former law).    If from all the facts and circumstances an implied trust is otherwise established, it is not destroyed by the express verbal agreement which may have constituted a part of the transaction. The express agreement may be shown, not as fixing the interest to be owned by the parties, but as rebutting the inference of a gift by the plaintiff. Hudson v. Evans, 198 Ga. 775, 32 S.E.2d 793 (1945) (decided under former Code 1933, § 108-106); Harper v. Harper, 199 Ga. 26, 33 S.E.2d 154 (1945); Lominick v. Lominick, 213 Ga. 53, 96 S.E.2d 587 (1957) (decided under former Code 1933, § 108-106);(decided under former Code 1933, § 108-106).    Record title is not conclusive of beneficial ownership.  Darby v. United States, 496 F. Supp. 943 (S.D. Ga. 1980) (decided under former Code 1933, § 108-106).    It must appear from the entire transaction that there is an obligation on the part of the holder of the legal title to hold the title for the benefit of someone else. Barnes v. Barnes, 230 Ga. 226, 196 S.E.2d 390 (1973) (decided under former Code 1933, § 108-106).   Proof generally.    - An instrument relied upon as creating an implied trust must show facts from which it may be ascertained that legal title to the property is in one person and the beneficial interest in another. West v. Downer, 218 Ga. 235, 127 S.E.2d 359 (1962) (decided under former Code 1933, §§ 108-106.1 and 108-106.2)    Conduct and declarations of the parties subsequent to the transfer, which are consistent with an agreement to hold the property for the benefit of another, may be evidence of a constructive trust. Dodd v. Scott, 250 Ga. App. 32, 550 S.E.2d 444 (2001) (decided under former O.C.G.A. § 53-12-94).   Use of parol evidence.   - An implied trust reflecting the true intentions of the parties may be established by parol evidence, although the effect of such evidence is to alter or vary a written instrument. In re Gaites, 466 F. Supp. 248 (M.D. Ga. 1979) (decided under former Code 1933, § 108-106).    Trial court did not err in allowing parol evidence to establish an implied trust in favor of the grantor, notwithstanding the warranty deed from the grantor to the grantor's brother, since it was agreed the grantor would continue residing in the house for the grantor's lifetime upon payment of taxes and insurance. Georgia Farm Bureau Mut. Ins. Co. v. Smith, 179 Ga. App. 399, 346 S.E.2d 848 (1986) (decided under former O.C.G.A. § 53-12-34).   Parol evidence proper to determine creation of implied trust.    - Earmarking doctrine did not apply because there was no substitution of one creditor for another, and although the only written documentation of the loan was a promissory note, parol evidence could be used to determine if the loan created an implied trust. Tidwell v. Hendricks (In re McDowell), 258 Bankr. 296 (Bankr. M.D. Ga. 2001) (decided under former O.C.G.A. § 53-12-94).   Parol evidence rule.    - Allegations and proof under former Code 1933, § 108-106 need not conform to the parol evidence rule as stated in former Code 1933, § 38-501 (see O.C.G.A. § 24-6-1). Guffin v. Kelly, 191 Ga. 880, 14 S.E.2d 50 (1941) (decided under former Code 1933, § 108-106).   Implied trusts not within statute of frauds.    - Implied trusts are not within the statute of frauds, and the courts will hear parol evidence, showing the facts from which the trusts are sought to be implied. Alexander v. Alexander, 46 Ga. 283 (1872) (decided under former Code 1868, §§ 2290 and 2291); Jackson v. Jackson, 150 Ga. 544, 104 S.E. 236 (1920); Guffin v. Kelly, 191 Ga. 880, 14 S.E.2d 50 (1941) (decided under former Civil Code 1910, §§ 3731, 3732, 3733, and 3739);(decided under former Code 1933, § 108-108).    In all cases where a trust is sought to be implied, the court may hear parol evidence of the nature of the transaction, or the circumstances, or conduct of the parties, either to imply or rebut a trust. Hemphill v. Hemphill, 176 Ga. 585, 168 S.E. 878 (1933) (decided under former Civil Code 1910, §§ 3732 and 3739).    While an express trust must be created by writing, and cannot be proved by parol, implied trusts may be established by parol evidence, although the effect of such evidence is to alter or vary a written instrument, and although the defendant sets up and insists upon the statute of frauds. Sykes v. Reeves, 195 Ga. 587, 24 S.E.2d 688 (1943) (decided under former Code 1933, § 108-108); Hall v. Turner, 198 Ga. 763, 32 S.E.2d 829 (1945);(decided under former Code 1933, § 108-108).    To engraft an implied trust upon an absolute deed by parol evidence, such evidence ought to be clear and satisfactory. Brown v. Leggitt, 226 Ga. 366, 174 S.E.2d 889 (1970) (decided under former law); Georgia Farm Bureau Mut. Ins. Co. v. Smith, 179 Ga. App. 399, 346 S.E.2d 848 (1986);(decided under former O.C.G.A. § 53-12-34).   Parol evidence used to show deed made in trust.    - Deed absolute in form may be shown by parol evidence to have been made in trust for the benefit of the grantor when the maker remains in possession of the land. Hall v. Turner, 198 Ga. 763, 32 S.E.2d 829 (1945) (decided under former Code 1933, § 108-108).    An express trust cannot be made by parol agreement. Nor can an allegation of an express, oral trust be employed to defeat a resulting trust. Wells v. Wells, 216 Ga. 384, 116 S.E.2d 586 (1960) (decided under former Code 1933, § 108-105).    Cited in Wilder v. Wilder, 138 Ga. 573, 75 S.E. 654 (1912); Rich v. Rich, 175 Ga. 258, 165 S.E. 109 (1932); Jansen v. Jansen, 180 Ga. 318, 178 S.E. 654 (1935); Smith v. Harvey-Given Co., 182 Ga. 410, 185 S.E. 793 (1936); Clark v. Griffon, 207 Ga. 255, 61 S.E.2d 128 (1950); Hodges v. Hodges, 221 Ga. 587, 146 S.E.2d 313 (1965); Ashbaugh v. Ashbaugh, 222 Ga. 811, 152 S.E.2d 888 (1966); Epps v. Wood, 243 Ga. 835, 257 S.E.2d 259 (1979); Edwards v. Edwards, 267 Ga. 780, 482 S.E.2d 701 (1997); Bunch v. Byington, 292 Ga. App. 497, 664 S.E.2d 842 (2008).   RESEARCH REFERENCES   Am. Jur. 2d.   - 76 Am. Jur. 2d, Trusts, § 638.   C.J.S.   - 90 C.J.S., Trusts, § 68.   ALR.    - Grantee's oral promise to grantor as giving rise to trust, 35 A.L.R. 280; 45 A.L.R. 851; 80 A.L.R. 195; 129 A.L.R. 689; 159 A.L.R. 997.    Enforceability, as regards proceeds of sale of property, of real estate trust that does not satisfy statute of frauds, 154 A.L.R. 385.   Admissibility of subsequent declarations of settlor to aid interpretation of trust, 51 A.L.R.2d 820.