Campbell v. Welsh

Wilner, J., delivered the opinion of the Court. Mildred Campbell died on July 5, 1980, without a will. Surviving her as her heirs were four of her five children and several children of the one child who had predeceased her. At the time of her death, Mrs. Campbell was the record owner of a 2-1/2 acre tract of land in Howard County known as 9575 Gorman Road.

On November 14, 1980, appellant, one of Mrs. Campbell’s surviving children, filed an equity action in the Circuit Court for Howard County, in which he alleged that "in the year of about 1965,” he and his mother had entered into a "verbal agreement” under which she agreed to sell him a part of her property, as shown in a survey plat attached to the bill of complaint. 1 The agreement, he averred, called for him to pay a purchase price of $2,500 — $1,500 down and the $1,000 balance "from time to time as [his] financial condition ... permitted” — and to do certain renovation work on and about the property. He claimed that he made the down ⁶¹⁶ payment, did the renovation work, otherwise improved the property, and had been in exclusive possession of "the subdivided parcel” since the making of the agreement. "In about the year of 1970,” he continued, his mother, out of gratification, love, and affection, excused him from making any further payments and "promised him that she would make her Will in which she would confirm the sale of the subdivided parcel to [appellant] on the said terms and excuse him from payment of the balance of the purchase price thereof.” Finally, he alleged that Mrs. Campbell did in fact leave such a Will, "but he has been unable to locate the same.” The bill of complaint named as respondents Mrs. Campbell’s remaining heirs (the other children and grandchildren) and the personal representative of her estate. The relief sought was "[t]he appointment of a trustee to convey the subdivided parcel to [appellant] free and clear of any further liability to pay the balance of said purchase price” and "such other and general relief as to the Court may appear meet and proper in the premises.” On June 1, 1981, after the respondents had answered the bill of complaint, appellant filed "amendments by interlineation” through which he added an alternative claim for damages.

In a new paragraph 15, he averred that: "In the event [he] does not acquire ownership of said subdivided parcel in this proceeding, then he should be awarded damages against the Defendants in an amount equal to the fair and reasonable value of the improvements made by him in and to both said parcels to avoid the unjust enrichment on the part of the heirs of the estate.. ..” To secure that right, he asked for a lien on the two parcels "and appointment of a trustee to conduct a sale thereof to satisfy such lien.” Six weeks later — on July 20, 1981 — appellant filed an amended bill of complaint in which, for the first time, he quantified his claim for the improvements made by him, ⁶¹⁷ alleging their value to be $60,297, and added a further claim seeking reimbursement for certain utility bills paid by him. He did not specify the amount of these bills. Ultimately, after some additional exchanges of pleadings, the case proceeded upon appellant’s second amended bill of complaint, in which he continued to seek (1) specific performance of his oral agreement — that the personal representative or a trustee be directed to convey the parcel to him, and (2) in the alternative, a money judgment for the value of the improvements made by him (which was revised to $56,700) plus the utility payments (to which no value was yet assigned). The case was resolved in two stages.

On June 2,1982, the court entered summary judgment against appellant on his claim for monetary damages and, on July 28, 1982, after trial, the court denied appellant’s request for specific performance. This appeal challenges both of those rulings. 2 (1) Specific Performance Appellant’s principal claim, for specific performance, was rejected by reasor of the Statute of Frauds. Md. Code Ann. Real Property art., § 5-104 provides: "No action may be brought on any contract for the sale or disposition of land or of any interest in or concerning land unless the contract on which the action is brought, or some memorandum or note of it, is in writing and signed by the party to be charged or some other person lawfully authorized by him.” ⁶¹⁸ Appellant acknowledges that the contract upon which he sues was a verbal one. It was never reduced to writing and there is no evidence of any written memorandum or note of it signed by Mrs. Campbell.

Undaunted by this seemingly fatal lapse, appellant argues that (1) he is entitled to have a constructive trust declared upon the land, and (2) by reason of his partial performance of the contract, the bar of the statute does not apply. Appellant’s theory of constructive trust appears to be based upon a passage from Berens v. Wortman, 250 Md. 343 (1968). At page 348, the Court stated that "agreements to purchase land can be enforced in spite of the absence of a writing or memorandum sufficient to satisfy the Statute of Frauds where the circumstances require that equity impose a constructive trust, and these circumstances can exist when the parties stand in a confidential relationship.” We have no quarrel with that principle, as so stated. It clearly is the law in Maryland.

The problem, for appellant, is that the record before us fails to demonstrate any circumstance calling for the imposition of such a trust. His assertion that he "was accustomed to be guided by his Mother’s ... judgment and had the fullest confidence that she would act in his interest only,” which forms the sole basis of his claim, falls woefully short of what is needed to cast aside the Statute of Frauds and impress upon the land a constructive trust. Compare O’Connor v. Estevez, 182 Md. 541 (1943) and Dove v. White, 211 Md. 228 (1956), where such trusts were imposed. With respect to appellant’s defense of part performance, the evidence showed that, at some point in 1965, appellant and his family moved onto the disputed part of his mother’s property.

At that time, according to him, his mother agreed to sell him that part for $2,500, of which $1,500 was to be paid then and the balance when and as he could afford it. There is no written evidence of the contract or the $1,500 ⁶¹⁹ payment; nor, aside from appellant, were there any witnesses to either event. No check, no receipt, no bank records — nothing, aside from some hearsay testimony from appellant’s wife and daughter was offered to show the actual transfer of the $1,500. After moving onto the property, appellant built a storage shed and a "shop,” which he used in his construction business.

He renovated an old dwelling house situated on that part of the property purportedly retained by the mother, which he used as a residence for himself and his family; he planted an "orchard” of some twenty-five trees, whose bounty he retained for himself; he built a driveway from Gorman Road to his new residence; and he did some repair or maintenance work in or about the house trailer in which his mother lived. Appellant remained on the property — both parts of it — without making any further payments to his mother, for the next fifteen to sixteen years. Because of the strictures of the "Dead Man’s Statute” — Md. Code Ann. Courts art., § 9-116 — appellant was precluded from testifying about the alleged transaction, and so he offered to prove the contract itself through his wife and children. Appellant’s wife testified that "around ’66, somewhere along in there” — when they first moved onto the property — her mother-in-law told her "that she’d sold Don [appellant] a piece of land” and that "he’d gave her fifteen hundred dollars on the piece of property.” The wife was not certain if anyone else was present when this conversation occurred.

In 1970, during a family gathering, there was another conversation with the mother. The wife’s testimony was as follows: "A. Well, she was telling Don that — well, she was telling me and my daughter, Don-Ann, she was talking about how nice the dwelling house looked where we was living, and she said then, at that time, that she was going to relieve him of the money that he still owed on the property, because it — I think the original thing, I think, was ⁶²⁰ twenty-five hundred dollars. I’m not, you know, real certain that’s what she said. Q. Did she mention any amounts?

A. I think she said twenty-five hundred, she had gotten fifteen. As best as I can recall that’s what it was.” In that same conversation, according to the wife, the mother said that "she was going to make a will, and she told Don, she said if, you know, if anything happened to him that she would leave the property to the oldest daughter [of appellant].” (Emphasis supplied.) The daughter, Don-Ann, also testified about this 1970 conversation. She recalled her grandmother saying, "That the thousand dollars that he owed he would not owe anymore, and that she would go ahead and put the property, the deed, in his name, and my father replied no, because of some problems I’m having with taxes, or something, I don’t want the deed in my name, but in the event of my death I would want you to put the property in my daughter’s name — Don-Ann’s name, and she said she would do that and would confirm so in her will.” (Emphasis supplied.) The only other evidence purporting to corroborate the alleged contract (aside from evidence as to the improvements made by appellant) came from appellant’s other two daughters — Myra and Rebecca. Both recalled instances when they or appellant did work on the grandmother’s "part” of the property and when the grandmother referred to the part where they lived as their father’s land.

Rebecca purported to recall a conversation occurring in 1966 — when she was ten years old — regarding the boundary line between the two parcels. The general principles of law regarding cases such as this were laid down in Semmes v. Worthington, 38 Md. 298 (1873). There, as was ultimately the case here, the com ⁶²¹ plainant was seeking specific performance of an oral agreement to convey land by will; there, as here, he defended against the Statute of Frauds on the ground of part performance measured principally by his possession of the land, his working it, and his making certain payments in furtherance of the agreement. Speaking for the Court, Judge Alvey addressed both the nature of the acts sufficient to constitute the requisite part performance and the type and degree of evidence necessary to prove those acts.

As to the first, the Court held, at pp. 326-27: "The act relied on as part performance must, in itself furnish evidence of the identity of the contract; and it is not enough that it is evidence of some agreement, but it must relate to and be unequivocal evidence of the particular agreement charged in the bill. Canal Co. v. Young, 3 Md. 480 . And the court is never anxious to grasp at slight circumstances to rescue a case from the operation of the Statute, nor does it indulge in any latitude of construction, where there is any equivocation or uncertainty in the case presented. It adopts the rule that the contract should be clear and definite, and that the acts done should be equally clear and definite and solely with a view to the performance of the particular agreement....

The acts done must be of a substantial nature, and such, that the party would suffer an injury amounting to a fraud by the refusal to execute the agreement.” (Emphasis in original.) These principles have been repeated and applied many times by the Court of Appeals. See, for example, Shimp v. Shimp, 287 Md. 372, 382-83 (1980); Beall v. Beall, 291 Md. 224, 230 (1981); Withers v. Douglas, 206 Md. 141 (1955); Shives v. Borgman, 194 Md. 29, 35 (1949). In Hamilton v. Thirston, 93 Md. 213, 219 (1901), the Court adopted Lord Hardwicke’s pronouncement in Lacon v. Mertins, 3 Atk. 4, ⁶²² that the act relied on as part performance "Must be such an act done as appears to the Court would not have been done unless on account of the agreement,” adding that the Court of Appeals itself "has repeatedly said that such acts must be clear and definite and refer exclusively to the alleged agreement.” (Emphasis supplied.) That too has been repeated and followed by the Court in later years. See Soho v. Wimbrough, 145 Md. 498 (1924); Serio v. Von Nordeck, 189 Md. 388 (1947).

As to the nature and quantum of proof necessary to establish these unequivocal acts, the Court in Semmes v. Worthington, supra, at 318, held that "[t]he proof, must be clear and explicit, leaving no room for reasonable doubt.” Quoting then from Justice Grier’s Opinion in Purcell v. Miner, 4 Wall. 517, Judge Alvey continued: " 'Such proof must be clear, definite and conclusive, and must show a contract leaving no jus deliberandi or locus penitentiae. It cannot be made out by mere hearsay, or evidence of the declarations of a party to' mere strangers to the transaction, in chance conversations, which the witness had no reason tó recollect from interest in the subject-matter, which may have been imperfectly heard or inaccurately remembered, perverted or altogether fabricated; testimony therefore, impossible to be contradicted.’ ” (Emphasis supplied.) That remains the standard to this day. See Moats v. Estate of Lily W. Pumphrey, 33 Md.App. 9, 18 (1976). Against this high standard of proof, the evidence supplied by appellant is grossly insufficient.

The contract itself is unclear — first ah agreement to sell him a parcel of land for $2,500, four or five years later an agreement to modify the purchase price by forgiving the unpaid balance of $1,000, and finally a new agreement to leave the property to appellant’s daughter who, we note, is not even a party to this proceeding. 3 Even this much we glean only, in the words ⁶²³ penned by Justice Grier and quoted by Judge Alvey, "by mere hearsay, or evidence of the declarations of a party to mere strangers to the transaction, in chance conversations. ...” The acts offered up as part performance of this rather fluid agreement are hardly referrable exclusively to it. Appellant, who was in the construction business, took possession of a piece of land, built some improvements on it that he used in his business, and renovated an existing house for use as his home. He built a driveway from the house to the road, planted some trees, and maintained the yard. He lived and worked there for fifteen or sixteen years, paying nothing more than the $1,500 he claims to have paid in 1965.

If that were enough to avoid the Statute of Frauds, there would be no Statute of Frauds. (2) Money Damages Our conclusion that the alleged agreement between appellant and his mother is unenforceable by reason of the Statute of Frauds does not necessarily dispose of his claim for money damages. For, as the Court of Appeals held in McNamee v. Withers, 37 Md. 171, 177-78 (1872), "The principle is well established, that if one person expends his money in making beneficial improvements on the land of another, upon the faith of a parol contract by the latter to convey; where specific execution of the contract cannot be decreed, because of the uncertainty in the proof of its terms, a court of equity will decree compensation to the extent of the value of such improvements, and in some cases, as in King v. Thompson, 9 Pet. 204 , will grant relief by declaring the same to be an equitable lien upon the property.” ⁶²⁴ See also Stevens v. Bennett, 234 Md. 348, 352 (1964); Mangione v. Braverman, 234 Md. 357 (1964); Boehm v. Boehm, 182 Md. 254 (1943); Duck v. Quality Custom Homes, 242 Md. 609 (1966), permitting recovery at law, on a quantum meruit basis, for services performed or money paid in reliance on an unenforceable oral contract for the sale or devise of realty. The circuit court apparently recognized this principle, as it did not dispose of appellant’s alternative claim for money damages on the basis of the Statute of Frauds.

That claim was rejected because it was filed too late, which, indeed, it was. Md. Code Ann. Est. & Tr. art., § 8-103 (a) provides, with exceptions not relevant here, that, "all claims against an estate of a decedent, whether due or to become due, absolute or contingent, liquidated or unliquidated, founded on contract, tort, or other legal basis, are forever barred against the estate, the personal representative, and the heirs and legatees, unless presented within six months after the first appointment of a personal representative.” The first appointment of Mrs. Campbell’s personal representative, who, ironically was appellant, occurred on July 15, 1980, 4 and notice of that appointment was duly given to creditors. Appellant had six months from that date — until January 15, 1981 — to file his claim. No claim of any kind based upon the alleged oral agreement between appellant and his mother or otherwise respecting the land in question was made until appellant filed his first bill of complaint in November, 1980.

That, of course, was filed within the six-month period; but, as noted, no claim was made therein for any money damages. The only ⁶²⁵ specific relief sought by that bill was a conveyance of the