Court Opinion

ID: 2669271
Source: CourtListenerOpinion
Date Created: 2014-04-09 15:11:42.528768+00
Date Added: 2024-06-11T12:19:31.634028
License: Public Domain

Cite as 2014 Ark. App. 222

                 ARKANSAS COURT OF APPEALS
                                       DIVISION III
                                       No. CV-13-447

                                                   Opinion Delivered   April 9, 2014

JOHN BRUCE MCNEILL                                 APPEAL FROM THE GARLAND
                               APPELLANT           COUNTY CIRCUIT COURT
                                                   [NO. CV-2011-427-IV]
V.
                                                   HONORABLE MARCIA R.
                                                   HEARNSBERGER, JUDGE
LESLIE ROBBINS
                                  APPELLEE         AFFIRMED

                           BRANDON J. HARRISON, Judge

       In this dispute between a mother and her son over ownership of certain real property,

John McNeill appeals from the order of the Garland County Circuit Court that denied his

petition for partition, imposed an implied trust, and declared Leslie Robbins the sole owner

of the properties. We affirm the order of the circuit court.

       In 2004, Robbins conveyed to herself and McNeill, as joint tenants with right of

survivorship, six parcels of rental property located in Garland County. These were rental

properties that Robbins had previously acquired solely in her name. A seventh property was

purchased shortly thereafter and jointly titled.

       On 22 April 2011, McNeill filed a petition for partition of these seven properties. He

also requested a restraining order to prevent Robbins from collecting and retaining rent.

Robbins answered the petition and claimed that the properties were owned solely by her but

that she had added McNeill’s name to the deeds to allow him to gain credit to purchase other
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property and to pass the property to him outside of probate upon her death. Robbins also

counterclaimed for declaratory judgment for the properties to remain in her name, not subject

to partition, and that McNeill’s name be removed from the deeds. In November 2012,

Robbins amended her counterclaim for declaratory judgment, asserting that by placing

McNeill’s name on the property, she made him a constructive trustee, and requesting that the

constructive trust be dissolved.

       Following a hearing, the court requested that both parties submit proposed findings of

fact and conclusions of law. Both parties did so. By letter opinion dated 24 January 2013,

the court adopted Robbins’s proposed findings as its own. The order memorializing the

ruling was entered on 1 February 2013.

       The court found that, by placing McNeill’s name on the deeds, Robbins did not

intend for McNeill to have any beneficial interest but to act as an administrator if she died.

The court found that the sole property purchased in both names had been purchased with

Robbins’s money and that McNeill provided no consideration for the purchase and had paid

no expenses relating to any of the properties. The court found that a constructive trust existed

and ordered McNeill to relinquish any claim of ownership and to execute all deeds necessary

to carry out its order. In the alternative, the court found that Robbins retained ownership

of the property due to a resulting trust and ordered that the deeds be set aside. The court

denied McNeill’s petition for partition. McNeill appealed.

       On appeal, McNeill contends that (1) the court clearly erred in refusing to order

partition of the property jointly owned by the parties; (2) there is no basis in law or the facts

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to rescind the deeds to Robbins; (3) the court erred in finding that the parties did not have

a partnership; (4) the court erred in finding that tenants of the rental properties were necessary

parties to his partition action; and (5) the court erred in finding that a constructive trust or a

resulting trust existed in favor of Robbins.

       We address McNeill’s last argument—the implied-trust issue—first.               The term

“implied trust” encompasses constructive trusts and various types of resulting trusts. See

Edwards v. Edwards, 311 Ark. 339, 843 S.W.2d 846 (1992). A constructive trust arises in favor

of persons entitled to a beneficial interest against one who secured legal title either by an

intentional false oral promise to hold the title for a specified purpose, or by violation of a

confidential or fiduciary duty, or is guilty of any other unconscionable conduct that amounts

to a constructive fraud. Id. A resulting trust arises when one disposes of property under

circumstances raising an inference that he or she does not intend that the putative grantee

should have a beneficial interest in the property. Id.

       In general, a resulting trust must be proved by clear and convincing evidence. Edwards,

supra. But, the question on appeal is not whether we are convinced that clear and convincing

evidence supports the circuit court’s findings. Instead, we determine whether the findings are

clearly erroneous. Hearne v. Banks, 2009 Ark. App. 590, 376 S.W.3d 444. A finding is clearly

erroneous when, although there is evidence to support it, the reviewing court on the entire

evidence is left with a firm conviction that a mistake has been committed. Farm Credit

Midsouth, PCA v. Reece Contracting, Inc., 359 Ark. 267, 196 S.W.3d 488 (2004). Disputed facts

and determinations of credibility are within the province of the fact-finder. Id.

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       At the hearing, McNeill said that Robbins and his father had paid for the properties

prior to 2004 and that he did not provide any money for their purchase.                His sole

contribution was “sweat equity”; he would help maintain and repair the properties. McNeill

never reported income from the rental of the seven properties on his tax returns. McNeill

admitted that he had not filed partnership returns. And, he acknowledged that he had never

found the rental tenants or signed the leases for the properties, never paid the taxes or

insurance premiums for the properties, and never paid for the expenses for the properties. All

these payments came from Robbins.

       Robbins testified that she had transferred the six properties from her name to joint

ownership with McNeill to assist him in building capital and procuring other properties on

his own and that she never intended to create a partnership with him or provide him with a

present legal interest in the properties. When McNeill’s purchase of other properties did not

materialize, Robbins explained, she left his name on the properties “because he would have

inherited it anyway.” She testified that she still intended for McNeill to inherit the properties

in full but did not want to give up her present interest in them.

       In its order, the circuit court found that Robbins had no intention of transferring

present legal title or a beneficial interest to her son when she transferred the properties from

her sole name to a joint tenancy, as evidenced by the parties’ treatment of the properties over

the next seven years. The court concluded that a resulting trust was created, that McNeill’s

only interest in the property was as a trustee, and that he had violated his duties as trustee by

pursuing the partition action. Based on our deference to the circuit court’s resolution of

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disputed facts and determination of credibility, we cannot say the court clearly erred in this

finding. Therefore, we affirm on this point. Because we affirm the court’s imposition of a

resulting trust, we need not address McNeill’s argument concerning the constructive trust.

       Our resolution of this issue also supports affirming the court’s denial of McNeill’s

partition petition. McNeill argues that the court erred in denying his petition for partition

because the 2004 deed clearly gave him an interest in the property that would support

partition. But, McNeill’s discussion of the canons for construing deeds and other conveyances

misses the point of what an implied trust is—an equitable remedy designed to disregard the

legal title. And as discussed above, the court did not clearly err in imposing a resulting trust

and denying the petition for partition.

       Next, McNeill argues that the circuit court erred in rescinding the 2004 deeds that

created the joint tenancy. The court did not order rescission in this case. Rescission was

neither raised nor ruled on below. We will not address an argument on appeal if it has not

been argued before the circuit court or if a party has failed to obtain a ruling from that court.

Simpson Housing Solutions, LLC v. Hernandez, 2009 Ark. 480, 347 S.W.3d 1.

       McNeill next argues that, as a matter of law, he and Robbins had a partnership

regarding the ownership, rental, and maintenance of the properties. McNeill argues that

“Robbins never once denied that it was her intent to put her son in business with her, help

him develop ‘capital’ to get a rental business going and that that was the purpose of the deed.”

According to McNeill, the partnership or business relationship with his mother existed “off

and on, again, since 2000 potentially.” He could not give a specific date other than to say that

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the partnership existed prior to the May 2004 deed conveying an interest in the six properties

to him. McNeill said that Robbins continued to perform the same duties relating to the

properties as she had before the alleged 2004 agreement. He also admitted that he had never

requested an accounting or division of the rents and profits.

       Robbins denied that there was an agreement between the parties. She testified that

she paid McNeill only as an employee and issued 1099s to McNeill. In its order, the circuit

court found that there was no agreement between the parties. The court also found that

Robbins had provided all the funds for the purchases of the properties and paid the taxes and

that McNeill had produced no evidence that the parties divided profits or shared expenses.

       We hold that the evidence sufficiently supports the circuit court’s detailed findings that

no partnership existed between the parties. The parties’ actions do not show any intention

to have a partnership involving the ownership of the seven properties; instead, the evidence

shows that Robbins was the owner and treated the properties as her own. Because the

question of the preponderance of the evidence turns largely on the credibility of the witnesses,

we defer to the superior position of the circuit court. C.A.R. Transp. Brokerage Co., Inc. v.

Seay, 369 Ark. 354, 255 S.W.3d 445 (2007). We affirm on this point too.

       McNeill’s final argument is that the court erred in dismissing his partition petition

because he failed to name the tenants as parties. The court found that McNeill was merely

a trustee, not a property owner, and thus was not entitled to partition or other relief pursuant

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to Ark. Code Ann. § 18-60-401(a) (Repl. 2003).1 The court further found that, even if

McNeill could maintain a partition action, the action would fail for several reasons: (1) failing

to meet his burden of establishing that the properties cannot be divided due to great prejudice;

(2) failing to show that a sale is necessary and based on the consent of the parties, report of the

commissioners, and on evidence heard by the court; (3) failing to name several interested

parties (the tenants); (4) land cannot be partitioned if the title is disputed.

       Because we have affirmed the court’s finding of a resulting trust and that McNeill was

merely a trustee, we need not address this alternative basis for the court’s ruling. In addition,

the finding that the tenants were necessary parties was only one of several alternative bases for

denying the partition petition, and when an appellant fails to attack a circuit court’s

independent, alternative basis for its ruling, we will not reverse. See Pugh v. State, 351 Ark.

5, 89 S.W.3d 909 (2002); Morehouse v. Lawson, 90 Ark. App. 379, 206 S.W.3d 295 (2005).

       Affirmed.

       HIXSON and BROWN, JJ., agree.

       Jonathan D. Jones, for appellant.

       The Farrar Firm, by: Philip B. Montgomery, for appellee.

       1
        This section states that only certain persons, such as those who hold as joint tenants,
tenants in common, or holders of a dower interest, can maintain an action for partition.

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