Opinion ID: 874179
Heading Depth: 2
Heading Rank: 1

Heading: Did the District Court Err in Finding a Resulting Trust in Favor of the Kelleys?

Text: Citing Hettinga v. Sybrandy, 126 Idaho 467, 886 P.2d 772 (1994), Warren Yadon contends that the evidence was insufficient to support the district court's finding of a resulting trust. In Hettinga, we stated that a resulting trust can arise where title to property is transferred to one party, the trustee, although another party, the beneficiary of the trust, paid the purchase price for that property. 126 Idaho at 470, 886 P.2d at 775. With respect to the payment of the purchase price, we stated that the beneficiary must have paid or incurred an absolute obligation to pay for that property. Id. The district court found, George Kelley's testimony that he agreed, as part of the arrangement, to an absolute obligation to pay the Yadon's [sic] loans for the farm was credible and corroborated by Kim Yadon's testimony. Warren contends that the evidence does not support the finding that the Kelleys had incurred an absolute obligation to pay the loans because such obligation was not in writing. He states: [T]he Yadons were the only parties who incurred a written obligation to re-pay the loan.... The Kelleys did nothing to bind themselves in writing to make payments on the loan to either the bank or the Yadons. (Emphasis in original.) He requests that this Court make [a] legal determination that a verbal agreement to repay a loan in some else's [sic] name does not rise to the level of `incurring an absolute obligation' to pay the purchase price for the property. (Emphasis in original.) Warren contends that this request is supported by our opinion in Hettinga. He states, Even in Hettinga, where the purchase price was not delivered up front at the time of closing, and instead was being paid on a monthly installment basis, this Court still declined to impose a resulting trust where the Hettinga's [sic] were reimbursing the monthly installments to the Sybrandys. Warren misstates what we held in Hettinga. The facts in that case were that the Hettinga's hoped to purchase a dairy, but were financially unable to do so. The Sybrandys, Mrs. Hettinga's parents, agreed to purchase the dairy and lease the property to the Hettingas for a monthly payment equal to the payment due on the underlying land sale contract. Id. at 468, 886 P.2d at 773. Mr. Hettinga testified at trial that the parties intended at the time of the closing that the Sybrandys would purchase the dairy in their name to receive certain tax benefits, but that at some point in the future, the Hettingas could `take over' ownership by repaying the out-of pocket costs incurred by the Sybrandys. Id. at 470, 886 P.2d at 775. The trial court did not find Mr. Hettinga's testimony persuasive. It found that Mr. Hettinga's uncorroborated testimony regarding the Sybrandys' intent at the time the property was purchased did not rise to the clear and convincing degree of proof required to establish a resulting trust. We merely held that the court's finding that such uncorroborated and disputed evidence was not clear and convincing proof of the parties' intent is supported by evidence that is both substantial and competent. Id. Thus, in Hettinga we did not hold that a resulting trust cannot arise where the beneficiary orally agreed to repay the trustee for the purchase price of the property. In fact, over 100 years ago in Pittock v. Pittock, 15 Idaho 426, 98 P. 719 (1908), we held that a resulting trust could be created in that circumstance. In Pittock, the plaintiff brought an action in ejectment to remove a widow from a house and lot that were titled in the plaintiff's name. The widow counterclaimed, alleging she was the beneficiary of a resulting trust in the property. She offered evidence at the trial that she and her husband had arranged to purchase the property from the owners for $3,000; that the plaintiff orally agreed to purchase the property in his name and hold it in trust for the widow, conveying it to her when he was paid all sums he had advanced; that the plaintiff paid $1,500 to the owners as a down payment and gave a mortgage for the balance of $1,500, and the owners deeded him the property; that the down payment consisted of $550 borrowed from others by the widow, $50 paid to the owners by her husband, and $900 paid by the plaintiff as a loan to the widow; and that her husband, prior to his death, had fully paid the plaintiff all the money advanced by him as the purchase price. The district court granted judgment for the plaintiff, simply stating, without explanation, that it found that there was no competent evidence to sustain certain facts alleged in the cross-complaint. This Court vacated the judgment and remanded for a new trial. We held that the evidence is sufficient to establish a resulting trust. We stated that to establish a resulting trust of the type alleged in the case, the payment of the purchase price should actually be made by a person asserting the trust, or by some one for her, or that a binding obligation therefor be incurred by such person as a part of the original transaction at or before the time of the conveyance. Id. at 432, 98 P. at 721. We also held that the binding obligation to pay the purchase price can be an oral agreement to repay the purchaser (trustee) for the sums he paid to acquire the property, citing holdings from other courts. Id. at 431-33, 98 P. at 721. One of those courts held that a resulting trust arises by operation of law ... in favor of a person from whom [the purchase money] is advanced by way of a loan; the title being taken in the name of the lender as security for its payment. Id. at 431, 98 P. at 721. The other held that a resulting trust was created when the purchaser of land [orally] agrees to buy and hold it for the joint benefit of himself and another, the latter paying no part of the purchase money, but the purchaser advancing half of it for himself and half of it as a loan to the other party. Id. at 432, 98 P. at 721. We then concluded, If the [plaintiff] advanced the $900 referred to in the evidence at the request of the [widow] and with the agreement that it should be repaid to him, in that case he holds the property as trustee for the [widow]. Id. at 433, 98 P. at 722. Thus, an oral agreement to repay the purchaser (trustee) the purchase price of the property is sufficient to constitute an absolute obligation by the beneficiary to pay the purchase price. Warren also contends that there is insufficient evidence to support the finding of a resulting trust because the Kelleys never demonstrated when or under what circumstances the Montgomery farm would be returned to the Kelleys. That statement is inaccurate. George Kelley testified that the agreement was that he would receive title to the farm when he paid off the property. Q. And were you going to getdid you discuss ever your getting the property back? A. Yes. Q. What was said about that? A. Well, when wethe property was paid off, I was to get it back, and that was the purpose of putting a loan on it and the reason I farmed it all the time, 100 percent. Warren also claims that the district court improperly shifted the burden of proof to him. George Kelley and Kim Yadon testified that George had paid all sums due to the Yadons, while Warren testified that he had not. With respect to that conflict in the evidence, the district court wrote: George Kelley and Kim Yadon testified that George has always reimbursed the Yadons in full for any payments they have made. Warren testified that Kelley has not reimbursed the Yadons in full for payments they made, but presented no financial records or persuasive documentation to establish what payments the Yadons had made, the amounts of the payments, and no records were apparently kept to substantiate George Kelley's reimbursement payments to the Yadons. Warren contends, the trial court improperly placed the burden upon Warren Yadon to come up with `persuasive documentation' to support his testimony. Warren misconstrues the court's statement. The court was addressing credibility, not the burden of proof. It is the province of the trial court to determine the credibility of witnesses, the weight to be given their testimony, and the inferences to be drawn from the evidence. KMST, LLC v. County of Ada, 138 Idaho 577, 581, 67 P.3d 56, 60 (2003). The court expressly found that the testimony of Kim Yadon, Kitty Kelley (the Kelleys' daughter), and George Kelley was credible and substantial and that the testimony of Warren Yadon was conclusory at best. Warren Yadon has not shown that the district court erred in finding that the Kelleys had proved a resulting trust. We therefore affirm the judgment of the district court.