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Hocking v. Hocking

OPINION FILED AUGUST 23, 1979.

KENNETH D. HOCKING ET AL., PLAINTIFFS-APPELLEES,

v.

ASHLIE R. HOCKING ET AL., DEFENDANTS-APPELLANTS. — (DENNIS A. HOCKING, DEFENDANT-APPELLEE.)



APPEAL from the Circuit Court of Edwards County; the Hon. HARRY L. ZEIGLER, Judge, presiding.

MR. JUSTICE GEORGE J. MORAN DELIVERED THE OPINION OF THE COURT:

Defendants, Ashlie R. Hocking and Olive H. Hocking, appeal from a judgment of the circuit court of Edwards County finding that they held a 103-acre tract of land in a resulting trust for the heirs of Ashlie R. Hocking's father, Dennis Ashlie Hocking.

On appeal, defendants assert that the evidence presented by plaintiffs, who are the brothers and sister of the defendant Ashlie R. Hocking, was not sufficient to establish a resulting trust, that any rights plaintiffs might have had were waived by their execution of a general release of all claims arising out of their father's estate, and that their action is barred by laches.

In 1924 Dennis Ashlie Hocking owned a number of parcels of land located in Edwards County, aggregating to 357 acres. The 357 acres included the home place (103 acres), the Steward place (80 acres), Prairie farm (144 acres), the Bonpas bottoms (20 acres), and a 10-acre tract which had no common designation. In addition, Dennis' wife, Myrtle, owned a 50-acre tract known as the "Wade property" which she had inherited from her grandfather. The 357 acres were mortgaged to the Federal Land Bank (hereinafter "Bank").

In March of 1924, the Bank initiated foreclosure proceedings. Following the period of redemption, a master's deed was issued to the Bank. During the proceeding, Dennis attempted unsuccessfully to buy the entire property back from the Bank. The Bank was apparently completely unreceptive to such a sale, and Dennis eventually narrowed his objective to repurchase of the home place.

Late in 1925, defendant Ashlie Hocking agreed to purchase the home place in his name to avoid the impending eviction of his parents and siblings. On March 22, 1926, Ashlie entered a contract for purchase of the home place for the price of $3500. The price was to be paid as follows: $400 on execution of the contract, $300 on or before December 1, 1926, as an interest installment, $2200 paid by execution of a 36-year note to the Bank secured by a first mortgage on the home place, and $600 to be paid by execution of six promissory notes of $100 each, secured by a second mortgage on the home place.

On December 26, 1926, the Bank transferred legal title to Ashlie Hocking. Ashlie remained the sole legal title holder until January of 1968 when he conveyed the property into joint tenancy with his wife and co-defendant, Olive. Dennis retained possession of the property during his lifetime and apparently made all management decisions and collected rents and profits, except for oil royalties, discussed later in this opinion.

During the foreclosure proceeding in the 1920's, Myrtle Hocking transferred legal title in the Wade property to her mother, who on July 17, 1925, transferred the property to Ashlie. All parties concede that Ashlie took only bare legal title and that Myrtle remained the beneficial owner of the property. At Myrtle's direction, Ashlie conveyed the Wade property to his brother Burl in 1931. Burl subsequently divided the property into five 10-acre tracts and conveyed one to each of his brothers and his sister, retaining one for himself. This set of conveyances was also made in compliance with Myrtle's instructions.

Anticipating possible eviction from the home place due to the 1924 foreclosure, Myrtle purchased a home in Bone Gap. Title was held in Burl's name. At about the same time, Dennis purchased a produce business, which was also eventually titled in Burl's name. The parties agree that Dennis and Myrtle retained beneficial ownership in both of the properties. The produce business accounts were maintained in Burl's name, and Burl signed checks drawn on these accounts, but Dennis and Myrtle maintained complete control over the distribution of all funds connected with the business.

Subsequent to the foreclosure, Dennis purchased 21 acres of farmland, titling it in the names of Ashlie and his sister, plaintiff Harriet Chamberlin. During his lifetime, Dennis retained beneficial ownership of this property. Following Dennis' death in 1968, Harriet and Ashlie sold this acreage and divided the proceeds equally among the five siblings, pursuant to the intent of Dennis Hocking.

In 1941 Ashlie Hocking conveyed an undivided one-quarter interest in the mineral rights in the home place to Paul Blake. While there was some correspondence between Ashlie and Dennis regarding this transaction, it is clear that it was Dennis who negotiated the transfer and made the final decision regarding its completion, and after payment of the remaining indebtedness on the home place, it was Dennis who received the remainder of the purchase price. When problems developed with respect to receipt of oil royalties, a letter was sent over Dennis' signature demanding payment as per the royalty agreement. Ashlie received the royalties from oil production, but retained them in a separate "farm account" which he used exclusively for farm expenses, contributions to his parents' living expenses and the portion of his income tax attributable to the royalties. He also made interest-free loans to Harriet for the purchase of automobiles. Harriet testified that she first obtained permission for the loans from Dennis, then told Ashlie that Dennis had agreed to the loan, whereupon Ashlie gave her the money.

The evidence as to who made the payments on the mortgage on the home place following Ashlie's purchase of the property is hotly disputed. According to plaintiffs' testimony, Dennis made all payments with the possible exception of payments on the $600 second mortgage. Some of these payments were made directly to the Bank, but many were paid to Ashlie, who then paid the Bank with his own check. Burl Hocking testified that he signed several checks which were issued for mortgage payments during the time that the produce business accounts were held in his name. Rosella Hocking, the wife of plaintiff Kenneth Hocking, testified to a conversation she had with Myrtle in the early 1950's in which Myrtle told her that Myrtle and Dennis had repaid Ashlie all of the money paid on the mortgage, except for about $800. Myrtle expressed concern that Ashlie refused to discuss repayment of the $800 with Myrtle and Dennis. Rosella related the conversation to Olive following Dennis' death. Olive responded that at the time, Dennis' nonpayment of the $800 had prevented Olive and Ashlie from buying their own home. She did not deny that Dennis and Myrtle had repaid Ashlie the balance of the mortgage payments.

Burl testified that during a visit to Ashlie's home in Ohio in 1958, he saw a fully executed warranty deed conveying the home place from Ashlie and Olive to Dennis and Myrtle. Ashlie subsequently introduced an unrecorded quitclaim deed made in 1968, conveying a life estate to Dennis, which he testified he had shown to Burl. Burl denied having seen the quitclaim deed, and stated unequivocally that it was not the deed he had seen in 1958.

Shortly prior to his death, when asked by his children if his affairs were in order, Dennis indicated that they were, and made statements to the effect that Ashlie would handle ...


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