Ebert v. Ritchey

Gilbert, C. J., delivered the opinion of the Court. When Charles Ebert, a childless widower, died in 1978, he left five bank accounts, totaling approximately $86,794.16, and four siblings. The interest of the siblings in and to the principal of the bank accounts is the subject of this appeal. The Facts Prior to the death of Charles’s wife Louise in 1976, he and she jointly owned five bank accounts.

After her death Charles substituted on the accounts the name of his youngest brother, Anthony Ebert (Anthony), for that of Louise. Upon the death of Charles, Anthony took possession of the indicia of the accounts which had been physically kept by Charles. Anthony paid from the accounts Charles’s last expenses. He then withdrew the balance of the monies from the accounts and deposited them in other accounts bearing his name and that of his wife, Adeline.

Despite demand from Joseph Ebert, Andrew Ebert, and Barbara Mandish, Charles’s other surviving brothers and sister, as well as from Judith P. Ritchey, the personal representative of Charles’s estate, Anthony and Adeline steadfastly refused to surrender all or any part of the funds. Anthony insisted that the monies had been given to him individually. Anthony did, however, divide by four the approximately $8,000 of proceeds from two insurance policies in which he was listed as sole beneficiary. He sent each of his brothers and sister a sum of slightly more than $2,000.

Eventually, a bill of complaint was instituted in the Circuit Court for Baltimore County by Ms. Ritchey, the personal representative. Among the objectives of the suit were: ³⁹¹ a) the impression of a constructive trust upon the monies that Anthony and Adeline had received from Charles’s accounts; b) an accounting to the personal representative of the monies; c) payment to the personal representative of all the monies received by Anthony and Adeline from Charles’s accounts, together with interest and dividends earned thereon in the interim. Following much preliminary sparring in the form of pleadings, discovery, and the like, the case went to trial on a second amended bill of complaint. There was testimony from three witnesses as to five conversations with the decedent that occurred during the period May, 1977, through October, 1977.

In the course of those conversations, Charles is said to have told the witnesses that he "put ... Tony [Anthony] in charge of things” so that Anthony "could pay all the bills and straighten out all the problems that arise with that. And .. . they could take and divide up .. . [the] estate .. ..” One witness testified that Charles said, "I don’t want anything to go through Orphans’ Court, so it will be gobbled up by Orphans’ Court. I want everything divided up.” The testimony of Anthony, which was severely restricted by virtue of the "Dead Man’s Statute,” Md. Cts. & Jud.

Proc. Code Ann. § 9-116, dealt with the relationship existent between Charles and Anthony accounting from their childhood. Anthony told the chancellor that he "of his own accord” split the insurance proceeds with his sister and brothers because "he felt sorry for them.” It is fair to state that the witnesses generally described the relationship between Charles and his siblings as "close.” Anthony candidly acknowledges that fact. The personal representative, Judith Ritchey, after the testimony was concluded, was allowed, over objection, to file a third amended bill of complaint.

As a result of the amendment, Joseph, Andrew and Barbara were joined as parties plaintiff. ³⁹² The chancellor found that, "it was the intention of the decedent that the monies in the financial institutions should be collected by his younger brother [Anthony] and divided equally between himself and his two brothers and sister ....” The judge went on to rule that two bank accounts, one in the Savings Bank of Baltimore and the other a checking account in the Union Trust Company were "trust accounts” and thus the property of Anthony and Adeline. That ruling was grounded on Milholland v. Whalen, 89 Md. 212 , 43 A. 43 (1899). The remaining three accounts, the chancellor said, belonged to the appellees. He referred the matter to án auditor. 1 Anthony and his wife have appealed.

Joseph, Andrew, Barbara and Ms. Ritchey, as personal representative, have cross-appealed. The Issues The parties in their respective appeals posit a total of six questions. Anthony and Adeline ask: "I. Was it error to allow a third bill of complaint to be filed adding an entirely new class of plaintiffs after the case had been held sub curia.

II

Did the chancellor err in receiving inadmissible evidence to prove a trust.

III

Was the evidence sufficient to prove a trust by clear and convincing evidence.

IV

Was the Union Trust account a trust account and/or did it pass to appellant by operation of law. V. Did the agreement signed with Security Savings and Loan create a joint tenancy in the ³⁹³ funds and/or prevent the personal representative from claiming same for the estate and/or with all other evidence obviously show that a trust was intended though words 'in trust’ were not used.” Joseph, Andrew, Barbara and the personal representative raise one issue: VI. "In view of the court’s findings as to the intentions of the decedent, did the Chancellor err as a matter of law in failing to impose a constructive trust on the proceeds of the Union Trust checking account and the Savings Bank of Baltimore savings account?” The appellees have moved to dismiss the appellants’ appeal pursuant to Md. Rule 1036 on the ground that appellants’ brief violates Md. Rule 1031 as to "Style and Contents of Brief.” Although we agree that the brief does not conform strictly to the Rules, we nevertheless exercise our discretion and deny the motion because we do not view the violations as substantial. In light of the overlapping nature of the issues raised, we have opted to consider several of them together, and we have divided our opinion into four sections.

We shall, in discussing each section, add such additional facts as may be necessary. The Third Amended Bill of Complaint Appellants argue that the chancellor erred in allowing the filing of a third amended bill of complaint at a point in time following the trial and while the matter was being held sub curia. The original plaintiff, as we have seen, was Judith P. Ritchey, in her capacity as court appointed personal representative of decedent’s estate. See Md. Rule 203 b.

(1). Apparently, because of the evidence that unfolded at trial, Joseph, Andrew and Barbara sought to become parties plaintiff. By a third amended bill of complaint, their names ³⁹⁴ were added as complainants over appellants’ strong objection. Anthony contends that the decedent’s personal representative was not a proper party to bring an action to enforce a trust for the benefit of the surviving brothers and sister who may have a claim as beneficiaries of a trust.

Anthony cites as authority for his position Illian v. Northwestern National Insurance Co., 215 Md. 507 , 138 A.2d 884 (1958). That case, however, is factually inapposite. There the Court of Appeals dealt with an insurance policy purchased by a partnership. The Court said that a personal representative of a deceased partner could not maintain or join an action to enforce the insurance contract because the deceased partner’s interest in a partnership contract devolves on the surviving partners, not the personal representative. 215 Md. at 513 .

See, 1 Poe, Pleadings and Practice, (Sixth ed.), § 352; Restatement, Contracts, § 132; 4 Corbin, Contracts, § 939 at 783-784. What the appellants in this case overlook is that the personal representative asserted a claim to the funds on behalf of the estate, in addition to her request for a constructive trust. Certainly, the personal representative had not only a right, but a duty, to pursue what she believed to be assets of the estate she was charged with administering. Md. Rule 320 b. permits an amendment to be made so as to bring into the case any heir who might have been omitted, and the court, in a non-jury case, may allow amendment "at any time before a final judgment or decree is entered.” Md. Rule 320 c. 1.

Maryland has repeatedly held that amendments are to be permitted freely in order to promote the ends of justice. Staub v. Staub, 31 Md. App. 478 , 356 A.2d 609 (1976). The granting or denial of an amendment is within the discretion of the trial court. Sanford v. Sanford, 15 Md. App. 390 , 290 A.2d 812 (1972).

No appeal will lie from the trial court’s ruling in the absence of a clear showing of an abuse of discretion. Wright v. Trotta, 34 Md. App. 309 , 367 A.2d 557 (1976). "Additional parties plaintiff may be added . . . subject only to ³⁹⁵ the limitation contained in Rule 320 b .. . [1.] that 'some one of the original plaintiffs and some one of the original defendants must remain as parties to the action.’ ” Crowe v. Houseworth, 272 Md. 481, 485 , 325 A.2d 592 (1974). Appellants argue that they were unfairly prejudiced by the amendment because, had the heirs been party plaintiffs at the trial, appellants would not have been prevented by the Dead Man’s Statute, Courts Art. §9-116, from testifying as to their conversations with the decedent.

We think appellants misread the statute. Courts Art. §9-116 provides, in pertinent part: "A party to a proceeding by or against a personal representative, heir, devisee, distributee, or legatee as such, in which a judgment or decree may be rendered for or against them . .. may not testify concerning any transaction with or statement made by the dead or incompetent person,... unless called to testify by the opposite party . .. .” (Emphasis added.) Quite obviously, the statute embraces actions "by or against” heirs, devisees, distributees or legatees. Appellants fall clearly within the class of persons against whom the Dead Man’s Statute is directed. Had Joseph, Andrew and Barbara, as heirs, brought the action in the first instance against Anthony and Adeline, as heirs, the statute would have applied with the same force and effect as was applied in the trial of this cause.

Fairness to appellants compels us to note that in Snyder v. Crabbs, 263 Md. 28, 30 , 282 A.2d 6 (1971), the Court said that the Dead Man’s Statute "is applied only to proceedings brought by or against an executor or administrator as such. Beyond this narrow area it has no application.” Taken out of context the quoted statement would seem to rewrite the statute and limit its application to contests by or against personal representatives only. The statement by the Court is overly restrictive, but a careful reading of the opinion and the cases cited as authority leads to the conclusion that the ³⁹⁶ Court was actually holding in the case that the rule prohibits testimony by parties, not by third parties. Apparently in typing or printing the opinion, some of the wording of the statute was inadvertently omitted.

The Dead Man’s Statute applied in the instant case to testimony of appellants and appellees alike. The chancellor did not err in barring any testimony from them personally as to transactions with or statements by or to their deceased brother. Hearsay Evidence Appellants complain that the chancellor erred in admitting hearsay evidence to prove that the intention of the decedent was that upon his death all of his monies in financial institutions were to be collected and divided equally among his brothers and sister. The challenged testimony was that of three witnesses, who claimed to have held private conversations with Charles subsequent to the time he added Anthony’s name to the bank accounts. 2 The gist of each of the conversations was that Charles had selected his youngest brother, Anthony, to handle business affairs in the event that Charles became ill, and upon Charles’s death, to pay his last debts and then divide any remaining funds equally among the siblings.

Undoubtedly, that evidence was offered to prove the truth of an out of court statement. Therefore, the issue before us is not whether the contested testimony was hearsay but whether it is admissible as an exception to the Hearsay Rule. The Court of Appeals in Mason v. Poulson, 40 Md. 355 (1874), held that statements made by a decedent as to his ³⁹⁷ testamentary interest were admissible if offered through those persons who heard them. Courts in other States have generally arrived at the same conclusion as the Mason Court.

For example, in Griffin v. Robertson, 592 S.W.2d 31, 33 (Tex.Civ.App. 1979), Chief Justice William Cornelius of the Court of Civil Appeals of Texas, said: "Although there is some difference of opinion, the majority rule in the United States ... is that parol evidence is admissible to show the true intention of a depositor in setting up a joint survivorship account, even though such evidence contradicts the express terms of the joint account agreement.” California follows the same rule. Justice Traynor penned for the court in Whitlow v. Durst, 20 Cal. 2d, 523 , 127 P.2d 530 -531 (1942): "When intent is a material element of a disputed fact, declarations of a decedent made after as well as before an alleged act that