Court Opinion

ID: 1079596
Source: CourtListenerOpinion
Date Created: 2013-10-09 20:33:49.152404+00
Date Added: 2024-06-11T12:20:31.794345
License: Public Domain

IN THE COURT OF APPEALS OF TENNESSEE
                         WESTERN SECTION AT JACKSON
                 ______________________________________________

ROVENE LOWE,

       Plaintiff-Appellee,
                                                  Henry Chancery No. 16081FILED
Vs.                                               C.A. No. 02A01-9707-CH-00147
                                                                          April 8, 1998
WINNIE SUE SANDERS CANNON
and husband, ROBERT CANNON,                                               Cecil Crowson, Jr.
                                                                          Appellate C ourt Clerk
      Defendants-Appellants.
____________________________________________________________________________

                 FROM THE HENRY COUNTY CHANCERY COURT
                 THE HONORABLE WALTON WEST, CHANCELLOR

                               William T. Looney of Paris
                                     For Appellee

                             Teresa McCaig Marshall of Paris
                                     For Appellants

                             AFFIRMED AND REMANDED

                                      Opinion filed:

                                                          W. FRANK CRAWFORD,
                                                          PRESIDING JUDGE, W.S.

CONCUR:

ALAN E. HIGHERS, JUDGE

HOLLY KIRBY LILLARD, JUDGE

       This is a suit to establish a resulting trust and to recover for the breach thereof.

Plaintiff/Appellee Rovene Lowe (Lowe) brought suit alleging a resulting trust and seeking

damages arising from an alleged breach by Defendants/Appellants Winnie Sue Sanders Cannon
(Mrs. Cannon) and Robert Cannon (Mr. Cannon). The trial court found that Lowe had proven

the existence of a resulting trust and that the Cannons had breached the trust. Consequently, the

trial court awarded Lowe $15,840 in damages. The Cannons appeal.

                                               FACTS

        Lowe is an elderly widow, who was age 85 at the time of trial. When Lowe’s husband

died in 1985, she became the sole owner of all their property owned as tenants by the entirety.

In 1988 Lowe sold most of her land for $86,250. Lowe became dependent upon her younger

brother, Buford R. Sanders (Sanders), and the parties discussed living together in a home. Lowe

conveyed approximately five acres of land to Sanders and his wife, now Mrs. Cannon. Lowe

testified that she received no compensation for the conveyance, although the deed shows

consideration of $10.00. Mrs. Cannon testified that Sanders paid Lowe $4000 for the land. A

house was constructed on the land and the house contained a separate “apartment” occupied by

Lowe.

        The parties dispute the financing of the home’s construction. Lowe testified that she

made three payments totaling $74,420 for the construction of the house. Lowe maintained that

payments were made to Sanders’ son, Charles Sanders, who was employed by the builder of the

home.1 Lowe’s attorney at the time, Gary J. Swayne (Swayne) also testified about the financing

of the home’s construction:

                 I think we described the whole transaction as far as her funds
                 being used to build this house; there was going to be an apartment
                 placed there for Mr. Buford to take care of her the rest of her life.

Mrs. Cannon, however, testified that she and Sanders paid for the construction of the home.

        At trial, Lowe testified that it was the intention of Lowe and Sanders for Lowe to live in

the apartment for the duration of her lifetime. Lowe claims that she always assumed that she

would predecease Sanders. Therefore, she refused the advice of her attorney, Swayne, to draft

a document that expressly provided her with a life estate in the premises. Lowe’s alleged intent

to occupy the apartment for the remainder of her life was supported by the testimony of Swayne.

        Sanders died unexpectedly in 1990, and Sanders’ widow, Mrs. Cannon, became the sole

owner of the property as surviving tenant by the entirety. Mrs. Cannon married Mr. Cannon in

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            Charles Sanders died in 1990.

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1992, and the couple resided in the home. Lowe continued to live in the apartment until

September of 1993, when her friendship with the Cannons began to deteriorate. Lowe testified

that she felt isolated by the Cannons and unwelcome in the home. When the Cannons posted

“for sale” signs on the residence without notifying Lowe, Lowe decided to move elsewhere. The

Cannons sold the home to third parties in 1995.

       On August 4, 1995, Lowe filed this Complaint, alleging that she was the beneficiary of

an oral trust that was executed by her and her brother. Lowe alleges that the terms of the trust

were for Lowe to live in the apartment portion of the residence for the remainder of her lifetime.

Lowe claims that the Cannons breached the trust by selling the home, effectively evicting her

from the premises. Lowe sought damages accruing from this alleged breach.

       Following a bench trial, the trial court held that Lowe retained a resulting trust in the

apartment. Based on the evidence presented at trial, the trial court found that Lowe and Sanders

“had a clear understanding” that Lowe would reside in the apartment for the remainder of her

life and assessed damages at $15,840.

                                             ISSUES

       The first issue for review is:

               1. Was the Chancellor’s finding of a resulting trust between the
               Plaintiff and her deceased brother, Buford Sanders, proven by
               evidence that is “clear, cogent and convincing”?

       The Tennessee Supreme Court has described the creation and application of a resulting

trust as follows:

                 The imposition of a resulting trust is an equitable remedy; the
               doctrine of resulting trust is invoked to prevent unjust enrichment.
                Such a trust is implied by law from the acts and conduct of the
               parties and the facts and circumstances which at the time exist
               and surround the transaction out of which it arises. Broadly
               speaking, a resulting trust arises from the nature or circumstances
               of consideration involved in a transaction whereby one person
               becomes invested with a legal title but is obligated in equity to
               hold his legal title for the benefit of another, the intention of the
               former to hold in trust for the latter being implied or presumed as
               a matter of law, although no intention to create or hold in trust has
               been manifested, expressly or by inference, and there ordinarily
               being no fraud or constructive fraud involved.

In re Estate of Nichols, 856 S.W.2d 397, 401 (Tenn. 1993) (quoting 76 Am. Jur. 2d Trusts § 166

(1992)). To establish a resulting trust, the beneficiary must actually pay for or be obligated to

pay for “part of the original transaction of purchase” at the time that the transaction takes place.

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Rowlett v. Guthrie, 867 S.W.2d 732, 735 (Tenn. App. 1993). Due to their nature, resulting trusts

are usually proven by parol evidence. In re Estate of Wardell ex rel. Wardell v. Dailey, 674
S.W.2d 293, 295 (Tenn. App. 1983); Rowlett, 867 S.W.2d at 735. An alleged beneficiary of a

resulting trust bears the burden of proving the trust’s existence by “clear, cogent and convincing”

evidence. Nichols, 856 S.W.2d at 403 (quoting Wardell, 674 S.W.2d at 295). Therefore, our

review of the record is aimed at determining whether there is clear and convincing evidence to

support the trial court’s finding.

        The evidence in the record supports the trial court’s finding that Lowe established the

existence of a resulting trust in the apartment. Lowe’s testimony was supported by the testimony

of Swayne, a disinterested witness. Cf. King v. Warren, 680 S.W.2d 459, 461 (Tenn. 1984)

(“[T]he testimony of a single, interested witness would not be sufficient to establish a trust by

that quantum of proof.”). Based on the testimony by Lowe and Swayne, the trial court was

justified in finding that Lowe substantially contributed to the construction of the house. See

Rowlett, 867 S.W.2d at 735. Furthermore, Lowe and Swayne both testified that Lowe and

Sanders intended for Lowe to live in the apartment for the remainder of her life. When the

resolution of the issues in a case depends upon the truthfulness of witnesses, the trial judge who

has the opportunity to observe the witnesses in their manner and demeanor while testifying is

in a far better position than this Court to decide those issues. Mays v. Brighton Bank, 832
S.W.2d 347, 351-52 (Tenn. App. 1992). The weight, faith, and credit to be given to any

witness’s testimony lies in the first instance with the trier of fact, and the credibility accorded

will be given great weight by the appellate court. Id. at 352; Town of Alamo v. Forcum-James

Co., 327 S.W.2d 47, 49 (Tenn. 1959). After a careful examination of the record, we find that the

proof establishes the existence of the trust by “clear, convincing and cogent” evidence. Nichols,

856 S.W.2d at 403.

        The next issue for review is:

                2. Was the Chancellor’s finding of the Defendants’ breach of a
                resulting trust contrary to the facts presented at the trial and,
                instead, should the Plaintiff’s leaving the residence in question be
                considered a breach or abandonment of the oral trust?

        The evidence supports the trial court’s finding that the Cannons breached the trust when

they attempted to sell the residence without the consent of Lowe. The Cannons argue,

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alternatively, that Lowe abandoned the trust by moving out of the apartment on her own accord

before the home was sold. The Cannons do not cite authority from any jurisdiction that

recognizes the abandonment of an oral trust. Even if such a notion were recognized in this state,

this issue is irrelevant since the Cannons breached the trust before Lowe left her apartment.

       Accordingly, the judgment of the trial court is affirmed in all respects, and the case is

remanded for such other proceedings as are necessary. Costs on appeal are assessed to the

Appellants.

                                                      _________________________________
                                                      W. FRANK CRAWFORD,
                                                      PRESIDING JUDGE, W.S.

CONCUR:

____________________________________
ALAN E. HIGHERS, JUDGE

____________________________________
HOLLY KIRBY LILLARD, JUDGE

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