Appeal from the Circuit Court of Coles County; the Hon.
William J. Sunderman, Judge, presiding.
JUSTICE TRAPP DELIVERED THE OPINION OF THE COURT:
Plaintiff filed a complaint for partition of certain land located in Coles County. Defendant, Minnie Key, plaintiff's mother, counterclaimed, seeking to impose a trust on the entire acreage. The trial court found that plaintiff held the land in trust for Minnie, dismissed the complaint for partition, and ordered plaintiff to convey to Minnie any interest he might have in the premises. We affirm the trial court.
The derivation of the parties' title may be briefly stated. In 1947, plaintiff's father and Minnie's husband, Charles Key, was desirous of purchasing the land, but was unable to secure a sufficient loan. Plaintiff and his brother, Eugene, had recently been discharged from military service and had available to them certain provisions of the Soldiers' and Sailors' Civil Relief Act, commonly called the "G.I. Bill," by which they could obtain government-guaranteed mortgages. The purchase price of the land was $15,250; Charles, the father, provided a down payment of $2,250; plaintiff obtained a G.I. loan of $6,500 from the Veterans' Administration; Eugene, the brother, was only 19 years of age at the time and hence it was necessary under Federal regulations that a guardian be appointed for him in order to obtain his loan.
Charles filed a petition for guardianship in the circuit court of Douglas County, seeking to have himself appointed as guardian for Eugene. The court allowed the petition and Charles then signed the mortgage as guardian for Eugene. The conveyance was then made to plaintiff and Eugene as cotenants; the mortgage to Prudential Insurance Company in the amount of $13,000 was signed by plaintiff and Charles in his capacity as guardian.
In the verified petition filed by Charles for appointment as guardian of Eugene, it is said:
"[T]hat upon the consummation of the purchase of said real estate, the title and ownership thereto will be in the said Charles Eugene Key and Frank Clarence Key, in fee simple, as tenants in common, each owning an undivided one-half interest thereof, and the farming equipment and farming enterprise and the profits therefrom will be shared equally between them."
Charles did not sign the mortgage in his individual capacity. The signatures appearing on that document in the record are: "Charles Eugene Key, a minor, by Charles H. Key His Guardian Frank A. Key" (handwritten portions underscored, the rest typewritten).
• 1 Upon consideration of the opinions in Bowman v. Pettersen (1951), 410 Ill. 519, 102 N.E.2d 787, Wright v. Wright (1954), 2 Ill.2d 246, 118 N.E.2d 280, West v. Scott (1955), 6 Ill.2d 167, 128 N.E.2d 734, and Suwalski v. Suwalski (1968), 40 Ill.2d 492, 240 N.E.2d 677, we affirm the determination of the trial court that the transaction created a resulting trust in favor of the father, and his devisee.
In each opinion the essential characteristic is that a resulting trust was employed by the court to protect and preserve the interest of the party who paid the consideration and the expenses incident to the acquisition of the property.
In Bowman v. Pettersen, heirs sued to establish a resulting trust as to a dwelling in joint tenancy by the ancestor. When the ancestor was of advanced years he purchased the property directing that the deed be placed in joint tenancy with a young woman associate. Distinguishing the presumption which exists when a husband purchases real estate and places it in joint tenancy with his spouse, the supreme court noted that the chief factual issue was which joint tenant had paid the consideration for the real estate.
It appears that in Pettersen the conveyance was substantially a cash transaction. The opinion states:
"A resulting trust arises by operation of law where one person pays or furnishes the consideration for a deed conveying real estate to another. Whether or not such a trust arises depends in every instance on the intention, at the time of the conveyance, of the person who furnishes the purchase price. [Citations.] Such a trust arises, if at all, the instant the legal title is taken, and is founded upon the natural equity that he who pays for the property should enjoy it, unless he intended by the vesting of title to confer a beneficial interest upon the grantee. [Citations.] The payment of consideration raises a prima facie presumption in favor of a resulting trust. This presumption may be rebutted by parol proof of an intention on the part of the payor that the grantee shall take the beneficial interest and not merely the legal title." (Emphasis added.) 410 Ill. 519, 524, 102 N.E.2d 787, 790.
With the citation of Kane v. Johnson (1947), 397 Ill. 112, 73 N.E.2d 321, the court stated:
"[T]he expressed intent as shown by the direction and the deed, standing alone, must give way to the rule of equity which protects the party paying the purchase price by raising a resulting trust in his favor." 410 Ill. 519, 531-32, 102 N.E.2d 787, 794.
In West v. Scott, the application of a prima facie presumption of a resulting trust was reiterated. By reason of the age of the plaintiff, the lender required a co-signor of a note and mortgage. Hence, title was placed in joint tenancy with a niece who so cosigned. Upon plaintiff's action to quiet title, the court directed the niece to convey her claimed interest to plaintiff. The court stated:
"It is argued here that the necessity of a cosigner on the mortgage note takes this case out of the ordinary rule of resulting trusts because the signing of the note was consideration for the conveyance to defendant. It is conceded in the testimony that plaintiff furnished the entire consideration for the purchase of the property and that defendant has made no payments on the mortgage note and does not anticipate doing so. Thus, the cosigning did not constitute a quid pro quo for the conveyance" (6 Ill.2d 167, 173, 128 N.E.2d 734, 737)
"Taking the evidence as a whole, we feel that plaintiff has clearly and convincingly proved that she paid the entire price for the property placed in the joint names of the plaintiff and the defendant and has paid for all improvements thereon, the taxes and all mortgage note payments. Such facts raised a prima facie presumption in favor of a resulting trust and imposed the burden upon the defendant to show that she was to have some beneficial interest in the property." 6 Ill.2d 167, 175, 128 N.E.2d 734, 738.
In Suwalski v. Suwalski (1967), 88 Ill. App.2d 419, the trial court imposed a resulting trust upon the real estate held in joint tenancy. Plaintiff's father sought to purchase a home by a substantial down payment and a mortgage. By reason of his then age, he was unable to procure the full amount of the loan required. The defendant, a son, cosigned the contract note and mortgage and at the closing of the sale paid $1,500 to the lending institution. Title was taken in joint tenancy. Later, the father tendered $1,500 to the son and demanded conveyance. The latter then contended that he was a purchaser for value and an owner in joint tenancy.
The record showed that apart from the $1,500 initially paid, the son had not paid any of the mortgage payments, taxes, repairs, or improvements. The appellate court (Suwalski v. Suwalski (1967), 88 Ill. App.2d 419, 424, 232 N.E.2d 64) reversed the judgment of the trial court, noting the principle that "a resulting trust arises, if at all, at the time of purchase and is based upon the intention of the parties at that time" and commented, that plaintiff's evidence of payment "relates to the actions of the parties after the transactions in dispute."
The supreme court reversed the appellate court and affirmed the trial court with a finding of a resulting trust for the reason that the record disclosed that the payment of $1,500 by the son to the grantor and the fact that he was named as grantee in the deed did not make the son a joint tenant, because the intention of the parties was that the ...