Court Opinion

ID: 1043663
Source: CourtListenerOpinion
Date Created: 2013-10-08 00:24:51.927777+00
Date Added: 2024-06-11T13:02:14.117589
License: Public Domain

2012 VT 99

In re Estate of Maggio (2011-433)
 
2012 VT 99
 
[Filed 30-Nov-2012]
 
NOTICE:  This opinion is
subject to motions for reargument under V.R.A.P. 40 as well as formal revision
before publication in the Vermont Reports.  Readers are requested to
notify the Reporter of Decisions by email at: JUD.Reporter@state.vt.us or by
mail at: Vermont Supreme Court, 109 State Street, Montpelier, Vermont
05609-0801, of any errors in order that corrections may be made before this
opinion goes to press.
 
 

2012 VT 99

 

No. 2011-433

 

In re
  Estate of Daniel Maggio

Supreme Court

 

 

 

On Appeal from

 

Superior Court, Orleans Unit,

 

Civil
  Division

 

 

 

June
  Term, 2012

 

 

 

 

Robert
  R. Bent, J.

 

William L. Durrell and Nathan D.
Rectanus of Benjamin, Bookchin & Durrell, P.C., Montpelier,
  for
Appellant.
 
Charles D. Hickey, St. Johnsbury,
for Appellee.
 
 
PRESENT:  Reiber, C.J.,
Dooley, Skoglund, Burgess and Robinson, JJ.
 
 
¶ 1.            
ROBINSON, J.  Rosann Maggio, widow and primary beneficiary
of the estate of Daniel Maggio, appeals a decision of the superior court
holding that Daniel Maggio did not own an interest in real property in Holland,
Vermont at the time of his death.  Ms. Maggio argues that the trial court
erroneously admitted statements from her interrogatory answers in violation of
the best evidence rule, the dead man’s statutes, and the requirement in V.R.E.
602 that testimony be based on personal knowledge; that the court’s conclusions
that the property in question was partnership property and that Daniel Maggio
ceded his interest in the partnership to his partner, Paul Silas, prior to Mr.
Maggio’s death were unsupported by the evidence; and that the trial court erred
in declining to apply the statute of frauds to the transfer of Mr. Maggio’s
interest in the partnership.  We affirm.
¶ 2.            
Appellee, Paul Silas, and decedent, Daniel Maggio, operated a business
partnership in Connecticut.  In 1989, they acquired eight lots in Holland,
Vermont from Jipac, N.V.  Initially, Mr. Silas made a down payment
and executed a promissory note, and Jipac conveyed the property to Mr.
Silas.  A year later, Mr. Silas reconveyed the lots to himself and Mr.
Maggio as tenants in common.  The partnership ended in 1991.  Mr. Maggio
died in 1994.  
¶ 3.            
In 1992, after discovering that the conveyance of the divided lots
violated Act 250, Mr. Silas ceased making payments on the promissory
note.  Jipac sued Mr. Silas for payments due on the note, and Mr. Silas
counterclaimed, seeking rescission.  Because the court stayed the
proceedings to await environmental court review of the district coordinator’s
opinion that an Act 250 permit was required for the conveyance, the proceedings
took several years.  In 2000, Mr. Silas prevailed, and the superior court
ordered a rescission of the 1989 sale of the Jipac property to Mr. Silas and
entered judgment for a total of over $80,000 to Mr. Silas and two guarantors
who had contributed to the cost of the property.  We affirmed.  Jipac, N.V. v. Silas, 174 Vt. 57, 800 A.2d 1092 (2002).
 Neither Mr. Maggio nor his estate was a party to that suit, was awarded
judgment on the counterclaim, or was even mentioned in the judgment order
granting rescission. 
¶ 4.            
Mr. Silas then foreclosed on a judgment lien against Jipac and attempted
to sell the properties by foreclosure sale.  Mr. Silas was unable to do so
because the record deed to the properties still listed Mr. Maggio as a tenant
in common.  
¶ 5.            
Mr. Silas brought a probate action to clear title to the property under
14 V.S.A. § 1801, and Ms. Maggio opposed his petition.  During the
initial probate proceeding, the parties agreed to allow the sale of the
property and to have their respective interests converted to cash.  The
litigation then proceeded as an ancillary intestate proceeding to determine
whether or not decedent owned an interest in the property at the time of his
death in 1994.  In October 2007, the probate court entered judgment in
favor of decedent’s estate, concluding that the property was not owned by the
partnership and that, pursuant to the deed from Silas to Silas and Mr. Maggio
as tenants in common, decedent owned a one-half interest in the property at the
time of his death.  
¶ 6.            
Mr. Silas appealed the probate court’s judgment to the superior
court.  The superior court held a bench trial in June 2011.  Neither
Ms. Maggio nor Mr. Silas attended the trial; the only witness was a guarantor
on the original promissory note who sought to protect his interest in the
proceeds of the sale of the property as determined in the Jipac v. Silas
litigation.  The only evidence before the trial court on the issues
central to this case were several documents relating to the property and the
partnership (including the Maggio-to-Maggio-and-Silas deed, the promissory
note, and partnership tax returns) and interrogatory answers signed under oath
by appellant, Ms. Maggio.  The trial court reversed the probate court
judgment, concluding that, notwithstanding the characterization of title on the
deed, the property was an asset of the partnership; when the partnership dissolved, Mr. Maggio relinquished his interest in the
partnership, including his interest in the property.  Accordingly, the
trial court held that the estate of Maggio had no interest in the property at
the time of Mr. Maggio’s death.  
¶ 7.            
In support of its conclusion that the property was partnership property,
the court pointed to Ms. Maggio’s interrogatory answer that partnership funds
were used to purchase the property.  In addition, the court noted, based
on the partnership tax returns, that some of the property’s carrying costs
(i.e., taxes) were paid for with partnership funds.  Citing Connecticut law
that provided that “[p]roperty is presumed to be partnership property if
purchased with partnership assets,” even if the instrument transferring title
to the property does not name or reference the partnership, Conn. Gen. Stat.
§ 34-316(c), the court concluded that, therefore, the property was
partnership property.[1]
¶ 8.            
With respect to the question of whether, when the partnership dissolved
in 1991, Mr. Maggio ceded his interest in the Holland property to Mr. Silas,
the court noted that there was no documentary evidence of the partnership
dissolution.  However, Ms. Maggio testified in her interrogatory answers
that when the partnership ended, “[decedent] received $15,000, and [Mr. Silas]
received everything else.”  The court concluded that “everything else”
would have included the property at issue that had been purchased with
partnership funds.  The court noted that the fact that Mr. Maggio’s
interest in the property was not mentioned or discussed during the Jipac v.
Silas litigation further supported its conclusion that the partners
intended that Mr. Silas alone would retain the partnership’s interest in the
real property following the partnership dissolution.  
¶ 9.            
The court considered whether the statute of frauds required a writing to
relinquish Mr. Maggio’s interest in the partnership property back to the
remaining partner.  Applying Connecticut law, the trial court stated that
“a partner’s interest in real property is, in fact, a form of personal
property,” and thus no writing was required to cede Mr. Maggio’s interest in
the property to Mr. Silas in the context of the partnership dissolution. 
Accordingly, the court concluded that Mr. Maggio did not own any interest in
the Vermont property at the time of his death, and the owner of the funds
derived from the property’s sale was Mr. Silas, subject to any lawful claims
against it as partnership property. 
¶
10.        
On appeal, Ms. Maggio contends the court erred in: (1) admitting her
answers to interrogatories in violation of the best evidence rule and the “dead
man’s” statutes, and without an adequate foundation showing that she had
personal knowledge about her husband’s business affairs; (2) finding that the
property was a partnership asset; (3) finding that Mr. Maggio relinquished his
interest in the property to Mr. Silas in the partnership dissolution; (4)
holding that the statute of frauds did not apply to the transfer of Mr.
Maggio’s interest in the property to Mr. Silas; and (5) relying on Connecticut
law in its decision without first notifying the parties.  
I.
¶
11.        
First, we consider Ms. Maggio’s argument that the trial court erred in admitting
her interrogatory answers in violation of the best evidence rule, V.R.E. 1002,
1004, and Vermont’s “dead man’s” statutes, 12 V.S.A. §§ 1602-1603, and
without an adequate foundation because of a lack of personal knowledge.  V.R.E. 602.  Ms. Maggio objected to the introduction of
her interrogatory answers in a motion in limine, which the trial court
denied.  We review the trial court’s exercise of discretion for abuse of
discretion, Billings v. Billings, 2011 VT 116, ¶ 12, 190 Vt. 487, 35
A.3d 1030, and evaluate the questions of law de novo.  Garbitelli v.
Town of Brookfield, 2011 VT 122, ¶ 5, ___ Vt. ___, 38 A.3d 1133.
A.
¶
12.        
Over defendant’s best-evidence objection, the trial court admitted Ms.
Maggio’s answers to interrogatories into evidence.  In those
interrogatories Ms. Maggio was asked whether there was a written agreement that
ended the partnership between decedent and Silas, to which Ms. Maggio
responded, “I believe there was a written agreement, since both had attorneys,
but I do not have a copy of it, nor am I familiar with its terms.”  Ms.
Maggio was also asked “what each individual received in the way of business
assets when [the] business ended?”  Ms. Maggio responded: “Danny Maggio
received fifteen thousand . . . dollars.  Paul Silas received everything
else.”  Appellant argues that the “trial court erred by admitting the
interrogatory answers instead of the original written dissolution agreement,
without evidence of Silas having made a good faith effort to find the original,”
in violation of the best evidence rule.  V.R.E. 1002,
1004.  
¶
13.        
V.R.E. 1002—Vermont’s best evidence rule—requires that “[t]o prove the
content of a writing, recording, or photograph, the original writing,
recording, or photograph is required, except as otherwise provided in these
rules or by statute.”  
¶
14.        
The threshold question we must answer is whether Ms. Maggio’s
interrogatory answers were admitted to “prove the content of a
writing.”  The best evidence rule is a rule of common sense. 
“[I]n order for the rule to be applicable, a witness must be purporting to
testify as to his or her observation of the operative terms of a substantive
written document.”  Chevalier v. Dir. of Revenue,
928 S.W.2d 388, 392 (Mo. Ct. App. 1996).  “If a fact exists
independent of the writing, then the best evidence rule does not apply to
prohibit testimony as to the fact.”  Id. at 393; see also People
v. Tharpe-Williams, 676 N.E.2d 717, 720 (Ill. App. Ct. 1997) (“The best evidence rule
states a preference for the production of the original of documentary
evidence when the contents of the documentary
evidence are sought to be proved.”)  
¶
15.        
We have previously held that the best evidence rule does not exclude
testimony that does not purport to reproduce the contents of a
writing.  See, e.g., Vreeland v. Essex Lock & Mfg. Co.,
135 Vt. 1, 5, 370 A.2d 1294, 1296-97 (1976) (oral evidence of facts also
contained in price list admissible over best evidence objection because “[t]he
fact that particular information may be contained on a particular list does not alone require that
list to be introduced before presenting that information”); Don Lloyd
Builders, Inc. v. Paltrow, 133 Vt. 79, 81, 330 A.2d 82, 83 (1974) (best
evidence rule does not bar oral testimony derived from payroll records where
obligation at issue was not created by the writings involved); Lavalette v.
Noyes, 124 Vt. 353, 355, 205 A.2d 413, 415 (1964) (best evidence rule “does
not exclude evidence which is not aimed at the contents of the instrument,”
such as observation of who signed the document).  
¶
16.        
Ms. Maggio never suggested that she derived her understanding of what
each partner received upon dissolution from observing the operative terms of a
written partnership dissolution agreement.  To the contrary, Ms. Maggio
specifically stated that, although she believed a partnership
dissolution agreement existed “since both [parties] had attorneys,” she “was
not familiar with its terms.”  In this case, the fact that the dissolution
agreement between the parties may have been memorialized in a written document
does not render Ms. Maggio’s testimony about the resulting state of affairs,
not derived from any observation or characterization of a written document,
inadmissible under the best evidence rule.   
B.
¶
17.        
Vermont’s dead man’s statutes provide that, subject to enumerated
exceptions, “[a] party shall not be allowed to testify in his own favor where
the other party to the contract or cause of action in issue and on trial is
dead or shown to the court to be insane.”  12 V.S.A.
§ 1602.  
¶
18.        
In response to the common law rule prohibiting testimony from interested
parties, dead man’s statutes were created to broaden the scope of admissible
evidence.  In re Estate of Farr, 150 Vt. 196, 199, 552 A.2d 387,
390 (1988) (“[Dead man’s statutes] are statutes intended to allow otherwise
inadmissible evidence rather than statutes intended to create rules of
disqualification.”).  In the absence of an applicable exception, Mr. Silas’s
own testimony regarding his partnership dissolution agreement with Mr. Maggio
would be excluded under these statutes.  Ms. Maggio contends that
admitting her interrogatory answers allows Mr. Silas to accomplish the same
result, violating the statute.  We disagree.  
¶
19.        
The plain language of § 1602 disqualifies only surviving parties to
a contract, not other witnesses, from testifying in their own favor.  Our
prior decisions confirm this interpretation.  See, e.g., Bemis v. Lamb,
135 Vt. 618, 620-21, 383 A.2d 614, 617 (1978) (“Of course, because [the
individual who offered testimony regarding an oral contract] was not a party to
the alleged contract, 12 V.S.A. § 1602 is no
bar to his testimony.”).  And, in considering a virtually identical earlier
version of § 1602, we concluded that the dead man’s statutes require two
factors in order to disqualify a witness: “(1) the witness must be the
surviving party to the contract or cause of action in issue and on trial and,
(2) the testimony must be in his own favor. Neither standing alone will suffice
to reject the witness.”  Proulx v. Parrow, 115
Vt. 232, 236, 56 A.2d 623, 626 (1948).  Ms. Maggio was not a party
to the partnership dissolution agreement between Mr. Silas and Mr. Maggio, and
her testimony is not in her favor.  The dead man’s statutes prohibit
surviving parties from testifying in their own favor, but do not render
incompetent third parties, such as the beneficiaries of an estate, from
testifying to their detriment.  
C.
¶
20.        
Counsel for decedent’s estate also objected at trial to the
admissibility of Ms. Maggio’s interrogatory answers on the ground that Ms.
Maggio lacked personal knowledge about decedent’s business.[2]
 Ms. Maggio argues that the trial court should have excluded Ms. Maggio’s
interrogatory answers because no evidence was introduced demonstrating Ms.
Maggio’s personal knowledge of her husband’s business affairs.
¶
21.        
V.R.E. 602 precludes testimony of a witness “unless evidence is
introduced sufficient to support a finding that he has personal knowledge of
the matter.”  Mr. Silas argues that Rule 602 is inapplicable to Ms.
Maggio’s interrogatory answers because Ms. Maggio is a “party opponent” within
the meaning of Rule 801(d)(2), and that Rule 801(d)(2) does not require
admissions of a party-opponent to be based on personal knowledge.  Mr.
Silas cites the Advisory Committee Notes to Federal Rule of Evidence 801(d)(2) to support his position.  
¶
22.        
Ms. Maggio concedes in her reply brief that, “For purposes of the estate
and this lawsuit, Ms. Maggio is the ‘party opponent.’ ” 
We agree.  Rule 801(d)(2) provides that
“[a] statement is not hearsay if . . . . [t]he statement is offered
against a party and is (A) his own statement, in either his individual or a representative
capacity.”  (emphasis added.)
¶
23.        
We have not yet addressed the issue of whether party-opponent admissions
pursuant to Rule 801(d)(2) require personal knowledge
as a prerequisite to admissibility at trial.  The Reporter’s Notes to Rule
801 state: 
Admissions
are treated as nonhearsay because they come in as a by-product of the adversary
system, rather than because of any inherent quality of trustworthiness.
Moreover, the hearsay purpose of cross-examination is satisfied, because the
party uttering the statement can scarcely cross-examine himself, although he is
free to take the stand to explain the statement.  
 
Reporter’s
Notes, V.R.E. 801.  Accordingly, the Reporter’s Notes specifically conclude
that “the admissibility of an admission does not depend on
trustworthiness.”  Id.  This note strongly suggests that
evidence admissible pursuant to V.R.E. 801(d)(2) need
not satisfy the personal knowledge requirement of Rule 602.  
¶
24.        
Moreover, Rule 801(d)(2) describes five classes
of party-opponent statements excluded from the definition of hearsay. 
With respect to four of the classes, the rule says nothing concerning the
reliability of the statement; with respect to the fifth class—statements by
co-conspirators—the rule provides that such nonhearsay statements may be
admitted only if the court finds that the declarant is unavailable and that
there is sufficient indicia of reliability to show its trustworthiness. 
V.R.E. 801(d)(2)(E).  If trustworthiness, in the
form of personal knowledge, was otherwise a prerequisite to admission under
801(d)(2), the specific inclusion of that requirement
in 801(d)(2)(E) would be redundant.  Grenafege v. Dep’t of Emp’t Sec.,
134 Vt. 288, 290, 357 A.2d 118, 120 (1976) (recognizing “time honored precept
of ‘expressio unius est exclusio alterius’ ”—the expression of one
thing is the exclusion of another).
¶
25.        
The Advisory Committee Notes to the comparable federal rule provide
further support for the view that admissions of party opponents pursuant to
V.R.E. 801(d)(2) are exempt from the personal knowledge requirement.  When
adopted, V.R.E. 801 was “identical to Federal Rule 801,” and the Reporter’s
Notes accompanying V.R.E. 801 draw heavily on the Federal Advisory Committee
Notes to F.R.E. 801.  See Reporter’s Notes, V.R.E. 801.[3]  The Advisory Committee Notes to
Federal Rule of Evidence 801 explain:
No
guarantee of trustworthiness is required in the case of an admission. The
freedom which admissions have enjoyed from technical demands of searching for
an assurance of truthworthiness in some against-interest circumstance, and from
the restrictive influences of the opinion rule and the rule requiring
firsthand knowledge, when taken with the apparently prevalent satisfaction
with the results, calls for generous treatment of this avenue to admissibility.

 
Advisory
Committee Notes—1972 Proposed Rules, F.R.E. 801 (emphasis added).  
¶
26.        
Most federal appeals courts that have considered the matter have
concluded that admissions pursuant to F.R.E. 801(d)(2)
are not subject to the “firsthand knowledge requirement.”  See, e.g., Union Mut. Life Ins. Co. v. Chrysler
Corp., 793 F.2d 1, 8-9 (1st Cir. 1986) (“We note that the Advisory
Committee for the Federal Rules of Evidence refused to make personal knowledge
a prerequisite to the admissibility of admissions [of party-opponents].”
(internal quotation marks omitted)); United States v. Ammar, 714 F.2d
238, 254 (3d Cir. 1983) (“[I]t is clear from the Advisory Committee Notes that
the drafters intended that the personal knowledge foundation requirement of
Rule 602 should apply to hearsay statements admissible as exceptions under
Rules 803 and 804 but not to admissions (including coconspirator statements)
admissible under Rule 801(d)(2).”); see also United States v. Anudu, Nos. 92-5756 et al., 1996 WL 67214, at *13 (4th Cir.
Feb. 16, 1996);  United States v. Lindemann, 85 F.3d 1232, 1238
(7th Cir. 1996); United States v. McLernon, 746 F.2d 1098, 1106 (6th
Cir. 1984); Mahlandt v. Wild Canid Survival & Research Center, Inc.,
588 F.2d 626, 630-31 (8th Cir. 1978). 
¶
27.        
For the above reasons, we conclude that V.R.E. 801(d)(2)(A)
allows the admission of party-opponent admissions without regard to whether the
admission is based on personal knowledge.  Accordingly, Ms. Maggio’s
interrogatory answers, as party-opponent admissions under Rule 801(d)(2)(A), were not subject to Rule 602’s personal knowledge
requirement, and the trial court did not err in admitting them. 

 
 
II.
¶
28.        
Ms. Maggio further argues that the trial court erred in finding that the
Holland property was a partnership asset.  Ms. Maggio stated in her
answers to interrogatories that the Holland property was purchased with
partnership funds.  However, the deed to the Holland property provides
that Mr. Maggio and Mr. Silas owned the property as tenants in common, and
makes no mention of their partnership.  As set forth more fully below, the
question of whether the trial court’s finding that the property was partnership
property is a mixed question of fact and law.  “We will uphold a trial
court's conclusions concerning a mixed
question of law and fact if the court applied the correct legal standard and its
conclusions are supported by its factual findings.”  Adams v. Adams,
2005 VT 4, ¶ 10, 177 Vt. 448, 869 A.2d 124. 
Factual determinations “must stand if supported by
credible evidence, even though there may be inconsistencies or substantial
evidence to the contrary.”  Stamato v. Quazzo,
139 Vt. 155, 158, 423 A.2d 1201, 1203 (1980).
¶
29.        
The partnership statute in effect during Mr. Silas and Mr. Maggio’s
Connecticut-based partnership provided: “Unless the contrary intention appears,
property acquired with partnership funds is partnership property.”  Conn.
Gen. Stat. Ann. § 34-46 (West 1992) (repealed 1995).[4]  The Legislature based this statute
on the Uniform Partnership Act (UPA) § 8(2), which contains identical
language. Historical and Statutory Notes—Uniform Law, Conn. Gen. Stat. Ann.
§ 34-46 (West 1992) (repealed 1995).  Sufficient evidence in the
record supports the trial court’s finding that the property in this case was
purchased with partnership funds.  Partnership tax records admitted at the
hearing supported the trial court’s finding and Ms. Maggio admitted that the
property was purchased with partnership funds in her answers to
interrogatories.  These facts trigger the statutory presumption that the
property was therefore partnership property.  The critical question in
this case is whether the deed from Mr. Silas to Mr. Silas and Mr. Maggio as
tenants in common—with no mention of their partnership—compelled the trial court
to find a contrary intention sufficient to overcome the presumption.  
¶
30.        
Although the language in a deed may be a factor supporting a court’s
finding that property acquired with partnership funds was not intended
to be treated as partnership property, we reject the notion that, as a matter
of law, deed language trumps a court’s finding that property was acquired with
partnership funds.  To hold otherwise would render the applicable
provision of the UPA meaningless with respect to any property conveyed with a
document reflecting title.  In re Margaret Susan P.,
169 Vt. 252, 263, 733 A.2d 38, 47 (1999) (“We avoid a statutory construction
that would render part of the statutory language superfluous.”).
¶
31.        
Other courts applying this provision of the UPA have likewise applied
the presumption even in the face of conflicting deed or title language. 
See, e.g., Diranian v. Diranian, 773 N.E.2d 462, 466 (Mass. App. Ct.
2002) (concluding that evidence supported trial court’s finding that the
property in question was purchased with partnership funds and was therefore
partnership property even though it was titled to brothers as joint tenants
with rights of survivorship, with no mention of partnership); Crowe v. Smith,
603 So. 2d 301, 305 (Miss. 1992) (rejecting argument that property was not
partnership property because it was deeded to individuals as tenants in common,
explaining, “No evidence shows that the property was named as partnership
property in its record title or conveyed to the partnership.  On the other
hand, persuasive authority . . . shows that partnership property need
not be recorded as such, but may be proven to be in the partnership by other
indicia.”); Matter of Estate of Palmer, 708 P.2d 242, 249 (Mont. 1985)
(concluding that execution of a joint tenancy signature card for bank account
that was funded with partnership monies was insufficient to defeat the
presumption that the account was partnership property); Eckert v. Eckert,
425 N.W.2d 914, 916 (N.D. 1988) (concluding that patronage credits derived from
partnership business with cooperatives were presumed to be partnership
property, subject to proof of contrary intention, even though they were titled
in the name of individual partner). 
¶
32.        
Moreover, the fact that the property was titled to Mr. Silas and Mr.
Maggio as tenants in common does not necessarily evidence a contrary intent
sufficient to rebut the presumption that the property was intended as
partnership property.  Other than the language on the deed, Ms. Maggio offered
no other evidence to rebut the presumption that the property was partnership
property.  On this record, we cannot conclude that the trial court abused
its discretion in concluding that the property was partnership property.  
¶
33.        
Ms. Maggio cites our decision in Rooney v. Rooney for the
proposition that “real estate not in partnership title is not a partnership
asset unless there is a clear manifestation of intent that it was meant to be
partnership property.  Mere use or occupancy by the partners in and of
itself does not convert real estate into partnership property.”  158 Vt. 643, 644, 605 A.2d 520, 521 (1992) (citation omitted). 
Rooney involved farm property conveyed by a mother to herself and her
two sons as joint tenants with rights of survivorship.  The sons farmed
the land in partnership, both before and after their mother’s death. 
After one son died, the trial court ruled that, although the land had been held
by the sons as joint tenants with rights of survivorship, the legal effect of
the way they operated the farm was to convert the property from joint property
to partnership property.  We reversed, concluding that the evidence did
not support the trial court’s conclusion.  Id.  The critical
element, missing in Rooney and central to this one, is the applicability
of the UPA presumption that the property in this case was partnership property
because it was purchased with partnership funds.  In Rooney, the
sons apparently acquired the property as a gift from their mother, and thus there
was no evidence that the sons’ farming partnership paid for the acquisition of
the property.  For that reason, we did not even mention the UPA in that
decision.  Rooney does not undermine our conclusion that the trial
court did not abuse its discretion in finding that the property at issue in
this case was partnership property. 
III.
¶
34.        
Ms. Maggio further argues that the trial court’s conclusion that Mr.
Silas acquired sole title to the property following the dissolution of the
partnership was not supported by sufficient evidence.  The primary
evidence supporting the trial court’s conclusion was Ms. Maggio’s statement
that when the partnership dissolved “Danny Maggio received fifteen thousand . . . dollars.  Paul Silas received
everything else.”  The trial court reasonably concluded that the Holland
property, as partnership property, was part of the “everything else”
transferred to Mr. Silas after dissolution.  The court noted that its
conclusion was further supported by the absence of any reference to Mr.
Maggio’s purported interest in the Jipac v. Silas
litigation.   
¶
35.        
Ms. Maggio argues that because Mr. Maggio was not a signatory on the
promissory note that gave rise to the Jipac v. Silas litigation, he was
not a necessary party in that suit, and the court improperly relied on the fact
that he did not join that case to support its conclusion.  This challenge
misapprehends the thrust of the court’s analysis.  The court did not
suggest that Mr. Maggio was an essential party to the Jipac v. Silas
litigation.  Instead, it remarked that its conclusion about the parties’
intentions was consistent with the behavior of the parties subsequent to the
partnership dissolution.  The partnership dissolved in 1991, the conflict
concerning the failure of Jipac to secure appropriate Act 250 approval for the
conveyance first arose in 1992, and Mr. Maggio did not die until 1994. 
Notwithstanding considerable conflict with substantial ramifications with
respect to the value of the property and the enforceability of the underlying
purchase of the property, there is no evidence in the record of any act by Mr.
Maggio, Mr. Silas, or any third parties that suggests that after 1991 anyone
believed Mr. Maggio had an interest in the property.  The trial court’s inference
that the parties’ post-dissolution behavior, as reflected in the limited
record, supported its conclusion regarding their intentions in dissolving the
partnership was not clearly erroneous.
IV.
¶
36.        
Ms. Maggio challenges the validity of the transfer of the property from
her husband to Mr. Silas in the context of the partnership dissolution on the
ground that the statute of frauds requires a writing to memorialize transfers
of real property.  12 V.S.A. § 181(5).
 The trial court concluded that real property owned by a partnership is a
form of personal property, and thus the statute of frauds did not apply when
Mr. Maggio transferred his interest in the partnership, including the Holland
property, to Mr. Silas in the context of the partnership dissolution. 
Whether the transfer of an interest held by a partner in a partnership that
owns real property to another partner is subject to the statute of frauds is a
legal question that we review de novo.  Thompson v.
Dewey’s South Royalton, Inc., 169 Vt. 274, 276, 733 A.2d 65, 67 (1999). 
    
¶
37.        
The partnership statute in effect at the time Mr. Silas and Mr. Maggio
formed and then dissolved their partnership described a partner’s property
rights as including the partner’s “rights in specific partnership
property.”  Conn. Gen. Stat. Ann. § 34-62 (West 1992) (repealed
1995).  “Under Connecticut’s prior and current Uniform Partnership Act,
partnership realty is considered personalty with respect to any individual
partner’s rights therein.”  Gorelick v. Montanaro, 990 A.2d 371,
383 (Conn. App. Ct. 2010); see also Conn. Gen. Stat. Ann. § 34-64 (West
1992) (repealed 1995) (“A partner’s interest in the partnership is his share of
the profits and surplus, and the same is personal property.”).[5]  The trial court interpreted this
statute to mean that when the partnership ended in 1991, the transfer of Mr.
Maggio’s interest in the partnership to Mr. Silas was a transfer of personal
property for the purpose of the statute of frauds.  We agree.  
¶
38.        
One commentator has explained that the UPA, which was the basis for the
then-applicable Connecticut provision cited above, adopted the English approach
to partnership property; that approach views real property owned by a
partnership as personal property to facilitate property division during
dissolution.  W. Lewis, The Uniform Partnership Act, 24 Yale L. J.
617, 637 (1915) (“Experience has shown that the English courts in regarding the
interest of the partner in the partnership as personal property, irrespective
of the physical character of the property of the partnership, proceeded along
sound, and therefore, practical lines. . . . [E]very partner, on
winding up, has a right to receive in cash the value of [the partner’s]
interest in the firm.”).  A consequence of this classification is that a
transfer of a partner’s interest in a partnership, including an interest in a
partnership that owns real property, is not subject to the statute of frauds.
 See, e.g., Forward v. Beucler, 702 F. Supp. 582, 585 (E.D.
Va. 1988) (“[E]nforceability of an oral promise to transfer a limited partnership interest is not barred by
the statute of frauds even if the partnership’s sole asset is real property. . . . [P]artnership
interests are personalty whatever the nature of the partnership assets.”); Beach v. Anderson, 417 N.W.2d
709, 712-13 (Minn. Ct. App. 1988) (stipulation to transfer partnership interest
was an agreement to transfer personalty and therefore not subject to statute of
frauds, even though partnership owned real property); Malaty v. Malaty,
944 N.Y.S.2d 591, 593 (N.Y. App. Div. 2012) (“The statute of frauds does not
render void oral joint venture agreements to deal in real property, as the
interest of each joint venturer in a joint venture is deemed personalty.”); Potter
v. Homestead Preservation Ass’n, 412 S.E.2d 1, 6 (N.C. 1992) (“A partner’s
interest in partnership assets—including real property—is a personal property
interest.  As such, it is not subject to the statute of frauds.”); Wirth
v. Sierra Cascade, LLC, 230 P.3d 29, 45 (Or. Ct. App. 2010) (explaining
that the statute of frauds does not apply to agreements to transfer property
“from partner to partnership” or “from partner to partner, on behalf of the
partnership”). 
¶
39.        
Insofar as then-applicable Connecticut General Statutes § 34-64
provided that a partner’s interest in a partnership and its assets is personal
property, without regard to whether the partnership owns real property, Mr.
Maggio’s transfer of his interest in the partnership to Mr. Silas in connection
with the dissolution of the partnership was a transfer of personal property not
subject to the statute of frauds.
¶
40.        
Ms. Maggio argues that the trial court’s ruling concerning the applicability
of the statute of frauds conflicts with our decision in Quimby v. Myers,
2005 VT 123, 179 Vt. 611, 895 A.2d 128 (mem.).  We disagree.  In Quimby,
we considered the validity of an oral agreement to form a partnership and
transfer land, individually owned by one of the partners, to the
partnership.  We held this oral agreement unenforceable because it did not
comply with the statute of frauds.  The transfer at issue in the Quimby
case was a transfer of an interest in real property—from an individual to the
partnership.  The transaction did not involve a transfer of a partnership
interest because the property in question never made it into the
partnership.  The present case is distinguishable.  The transaction
at issue in this case involved Mr. Maggio’s relinquishment of his interest in
the partnership, which left Silas fully vested in all
remaining partnership assets, including the Holland property.  The pivotal
distinction is between a transaction that constitutes a conveyance of an
interest in a partnership, which is personal property regardless of whether the
partnership assets thereby conveyed include real property, and a transaction
that is a conveyance of the real property itself.  
V.
¶
41.        
Finally, we consider Ms. Maggio’s argument that the trial court erred by
relying on Connecticut law without first notifying the parties.  The trial
court concluded that the partnership owned the Holland property, that Mr.
Maggio transferred his interest in the property to Mr. Silas when the
partnership dissolved, and that the statute of frauds did not apply to this
transfer of partnership property.  In its September 16, 2011 judgment
order, the trial court based these determinations on Connecticut law because
the partnership was based in Connecticut.  However, in response to Ms.
Maggio’s motion to alter or amend judgment on the basis that the trial court
incorrectly applied Connecticut law, the trial court issued a follow-up order,
and arrived at the same conclusion based on Vermont law.  As noted above,
we uphold the trial court’s conclusions whether we apply Connecticut or Vermont
partnership laws in effect when the partnership acquired the Holland property
and subsequently dissolved.  Accordingly, Ms. Maggio’s argument has no
merit.   
Affirmed.

 

 

FOR THE
  COURT:

 

 

 

 

 

 

 

 

 

 

 

Beth Robinson, Associate Justice

 

[1] 
In its decision, the trial court applied Connecticut law because the
partnership was a Connecticut partnership.  See 11 V.S.A.
§ 3206(a).  After issuance of the superior court’s decision, Ms.
Maggio filed a motion to alter or amend the judgment on the basis that the
court erred in applying Connecticut law to the matter without notice to the
parties.  See V.R.C.P. 44.1(a).  The court denied Ms. Maggio’s motion
to amend, explaining that it would reach the same result under Vermont
law.  

[2] 
Mr. Silas argues that “no foundational objection was made in respect of the
introduction of the Interrogatory answers.”  However, the record reveals
that, after the trial court indicated it was struggling with finding personal
knowledge in relation to the interrogatories, counsel for Ms. Maggio indicated:
“And I do object on foundation grounds.”  

[3] 
The language of the federal and state versions of Rule 801 has diverged over
the years, but none of the amendments are pertinent to the issue before
us.  See Advisory Committee Notes—2011 Amendment, F.R.E. 801 (stylistic
amendment to federal rules not intended to change any results); Advisory
Committee Notes—1997 Amendment, F.R.E. 801 (amendment to federal rules designed
to address issues involving application of rule to co-conspirator statements);
Advisory Committee Notes—1987 Amendment, F.R.E. 801 (amendments to federal rule
technical and non-substantive); Reporter’s Notes—1986 Amendment, V.R.E. 801
(amendment to Vermont’s rule regarding co-conspirator statements made as part
of revision of Vermont’s conspiracy law).

[4] 
Vermont law at that time was identical.  11 V.S.A. § 1163(b)
(repealed 1997, No. 149 (Adj. Sess.), § 2).    

[5] 
The analysis under the Vermont law applicable at the time would be the
same.  See 11 V.S.A. § 1281, 1283 (repealed 1997, No. 149 (Adj.
Sess.), § 2) (characterizing partner’s interest in partnership as personal
property).