1. The evidence relied upon to establish a resulting trust in favor of a husband who paid the purchase-money for property and had the deed made in the name of his wife was insufficient for this purpose, and therefore the verdict for the husband was unauthorized by the evidence.
2. Likewise, the allegations of the husband's answer, which failed to allege that the husband did not intend to make a gift of the property to his wife, and did not otherwise show facts sufficient to rebut the presumption of a gift, and which failed to show any agreement, or otherwise to show an obligation, on the part of the wife to hold the property for her husband, were insufficient to establish a resulting trust.
3. It is never error to refuse to direct a verdict.
No. 15483. JUNE 5, 1946. On May 9, 1941, Nell Williams, William A. Thomas, and Bert Thomas, as three of the heirs at law of Nora M. Thomas, filed an equitable petition against J. M. Thomas and J. D. McDaniel, alleging in brief: that Nora M. Thomas died intestate on November 19, 1935, seized and possessed of described property, and leaving as her heirs at law the plaintiffs and others named, who were the intestate's children, and the defendant, J. M. Thomas, *Page 768 husband of the intestate and father of the plaintiffs; that no administration was had on the estate; that after the death of the intestate, all her children allowed the defendant Thomas to reside upon the property; that in April, 1941, the defendant Thomas, acting through his agent and employee, J. D. McDaniel, moved a sawmill upon the property and began cutting timber thereon and to manufacture the timber into lumber. The plaintiffs prayed for an injunction, a judgment for three-sevenths (representing their interest in the property) of the value of the timber cut, and for general relief.
The defendant Thomas answered, admitting that record title to the property was in the mother of the plaintiffs, and seeking to impress the property with an implied or resulting trust. He alleged substantially: that as executor of the will of his father he sold the property in question at public sale on May 1, 1928, at which time J. F. Holden, at the request of the defendant, bid in the property for the defendant for the sum of $7250; that on the same date, as such executor, he executed to Holden a deed to the property; that following the execution of the deed, Holden delivered the deed to the defendant, and "on the 26th day of May, 1928, the said J. F. Holden, at the instance, direction, and request of this defendant, executed a deed to the wife of this defendant . . conveying the title to the real estate . . and upon the execution of the deed the said J. F. Holden delivered the physical possession of this deed to the defendant;" that the defendant retained possession of both deeds until September 4, 1929, when they were delivered by him to the clerk of the superior court for recordation; that after being recorded, the deeds were delivered to the defendant, who thereafter retained possession of them until February, 1937, when he discovered that the deed from Holden to Nora M. Thomas was missing after a visit to his home by one of the plaintiffs; that the defendant, following the bid made by Holden at the sale, paid from his own personal funds the entire amount of $7250 bid for the property, making proper distribution of the funds to the devisees in the will of his father, and that neither Holden nor the defendant's wife paid any part of the purchase-price of the property; that thereupon he went into possession of the property, and has since remained in such possession, exercising control and management of the property, paying taxes *Page 769 and making described improvements thereon; that the defendant's wife, Nora M. Thomas, lived upon the farm with the defendant as his wife until her death, but she never exercised any control or ownership of the property, paid no taxes and made no improvements thereon; that her heirs at law have never exercised any control over the property and have never made any claim to the property, except that the plaintiffs made a claim thereto after the defendant's second marriage following the death of his first wife; that "when this defendant went into possession of this farm up until the 19th day of November, 1934, when the said Nora M. Thomas died, she at all times recognized that she had no interest or claim or title to said farm or any part of same, but on the contrary, recognized that this farm was the property of this defendant, he having paid the entire purchase-price for the same, and the said Nora M. Thomas — not having paid any part of the purchase-price of said property, and being the true, honest, and dependable wife that she was, she recognized that this defendant, her husband, was in law and equity and good conscience the owner of said property;" that "when the said J. F. Holden executed to the said Nora M. Thomas a deed conveying the title to the real estate . . and physically delivered said deed to this defendant, the title to said real estate became vested in the said Nora M. Thomas, as trustee, and for the benefit of this defendant, and a resulting trust, therefore, arose in favor of this defendant by reason of said averments set forth in this answer." The defendant prayed that title to the property be decreed in him.
The plaintiffs, at the trial, orally moved to strike all paragraphs of the answer seeking to set up a resulting trust, on the ground that the allegations were insufficient to establish a resulting trust. This motion was overruled, and exceptions pendente lite were duly preserved to this ruling.
On the trial, the defendant Thomas testified: "At the time I sold this farm down here in Georgia, as executor of my father's will, I was living on a farm that I owned up in Tennessee, and I still own that farm. When I sold this farm that is mentioned in this petition, that is in controversy here, as executor of my father's will, I sold it out here in front of the courthouse door in this county. Mrs. Thomas was not here. I made a deed down here in Tom Crawford's office, right here in town, after the sale *Page 770 was had here in front of the courthouse, and Mr. J. F. Holden was the highest bidder. I don't know as I went down to Mr. Crawford's office with Mr. Holden, but I went down to Tom's office and he told me he already had the deed drawn up. That was after the sale. I believe I signed the deed there. . . Then I got the deed back in my possession. I believe that deed was executed on the 1st day of May, but I don't recall the exact date. I kept the deed in my possession then until the 26th day of May before Mr. Holden made the deed then to my wife; it was some time. On the day I sold the land here and made Holden a deed as executor, my wife wasn't in Blue Ridge at all. She had nothing to do with the making of this deed to Holden. I did not then discuss it with her at all. I made the deed to Holden because he was the highest bidder on the property; he bid it off. I think I was present when Mr. Holden made this deed conveying that same property to my wife, Mrs. Nora M. Thomas. The deed purports to have been witnessed by Ellen Carver, who was a clerk in the bank at that time, and a Mr. Nitzschke; I wasn't acquainted with him, and I don't recall if that was his name. It is my recollection that this deed from Mr. Holden to my wife was signed there in the bank. My wife was not present when that happened. She didn't know anything about it. I had not discussed it with her, and had not mentioned it to her at all. At the time Mr. Fletcher Holden signed this deed conveying this property to my wife and he delivered that deed to me, up to that time, there had never been a word said between me and my wife, Mrs. Nora M. Thomas, about my putting this property in her name. There hadn't been a word said between us about it. I can't recall all that, about how long I held it before I put it on record. . . I had a safety deposit box in the Benton bank, up in Tennessee, and I carried those deeds to the Benton bank and put them in the safety box. A good while after that, some time later, my wife and I then moved back down on the old home place that I had had deeded to her. As to whether or not, when we moved down there, I brought this deed along with me and my wife — well, I did in a year or so after I moved back. I took this deed from Fletcher Holden to my wife and brought it her to the clerk's office myself and had it recorded. And from the time I moved back down here to the old home place, I kept this in the trunk; but it stayed in that safety box there for nearly a year after *Page 771 I moved back down there, and then I brought it down there and kept it in that trunk. It stayed there in that trunk then until after my wife's death. When I moved back down here into this county and onto this farm, my wife, Mrs. Nora M. Thomas, moved there with me. But she didn't stay there with me up until the date of her death, because she wasn't at home when she died. But that was her home; she was simply away for medical treatment. . . As I have alleged in my cross-answer here, the amount of money that Fletcher Holden paid for this property at the time it was knocked off to him here at public sale, I accounted to the legatees under my father's will for that money after I had paid the expenses of administration out of it. . . Holden did not get any profit out of this. Holden didn't charge me anything for keeping the title to this property for the twenty-five days, he didn't charge me any profit on it. As to whether he made the deed to my wife because I told him to make it to her — no, I didn't tell him, I told Tom Crawford there, me and Tom discussed it, and DuPre. That is my signature on my answer there that I filed. Then as to whether what is alleged in that answer is true, wherein it is stated that on the 26th day of May, 1928, at my instance and request J. F. Holden executed a deed to my wife — well, of course we made the deed, but I don't know whether that paper there is right or not. But I guess Holden would not have signed the deed to my wife if I hadn't told him."
The defendant further testified that from the date the property was sold at public outcry until the present time he has paid all taxes on the property; that he made certain improvements on the property, paying out almost $1000 for the improvements; that his wife lived in the home with him during this time up to the date of her death; that his wife "knew nothing whatever about the deed having been made to Holden and by Holden to her; she didn't know anything about that for quite a while. . . It was a year or over a year afterwards when she first learned about it."
An attorney testified that in the year 1931 he handled a matter for the defendant, J. M. Thomas, regarding the leasing of mineral rights to the property in dispute; that the defendant, his wife, Nora M. Thomas, and the lessee were present; that the defendant and his wife both signed the lease; that when the lessee inquired *Page 772 as to whom payment should be made, Nora M. Thomas said, "Messer (the defendant) owns it, make it to him."
Jim Franklin testified that before the death of the defendant's wife, Nora M. Thomas, he heard a conversation between the defendant and his wife; that he heard them talking about deeds; that the defendant's wife "told Messer (the defendant) she ought to make the deeds, and Messer told her he would have it fixed up;" that he doesn't know the year of the conversation nor to what property the defendant and his wife referred.
Grover Thomas testified that he once overheard a conversation between the defendant and his wife regarding the title to the property in controversy; that they were talking about having the deeds changed, and "he says, `I will go and get Col. Butt or Col. Crawford to come down here and fix the deed.'"
Other evidence showed that in the year 1938, after the death of Nora M. Thomas, all her heirs at law, including the plaintiffs and the defendant, J. M. Thomas, joined in a lease of quarrying rights to the property in controversy; that, in 1929, all the children of Nora M. Thomas, except the plaintiffs, Nell Williams and William A. Thomas, deeded their interest in the property by warranty deed to the defendant, J. M. Thomas.
A verdict was directed against the plaintiff, Bert Thomas, who was a grantor in the deed executed in 1939 to the defendant. A motion for a directed verdict for the other plaintiffs was refused, and to this ruling exceptions pendente lite were filed. The jury returned a verdict for the defendants. The plaintiffs, Nell Williams and William A. Thomas, filed a motion for new trial on the general grounds only, which was overruled; and to this judgment they excepted, also assigning error on their exceptions pendente lite. 1. The controlling question for determination is whether the evidence was sufficient to establish a resulting trust in favor of the defendant Thomas. The evidence relied upon to establish a resulting trust shows the following material facts: On May 1, 1928, the defendant Thomas, as executor of the will of his father, sold the property in question at public outcry, and one Holden, acting for Thomas, bid in the property. Thomas, as executor, executed to Holden a deed. *Page 773 Thomas paid from his own funds the entire purchase-price of the property, distributing the fund to the devisees named in the will of his father. Twenty-six days later Holden, at the request and direction of Thomas, executed to Thomas' wife a deed to the property. Both deeds mentioned were delivered to Thomas, who had them recorded, and thereafter retained possession of them. Thomas' wife had no knowledge of the transaction, and of the execution of the deed to her, until more than a year later. Thomas and his wife lived upon the property until the death of his wife intestate. Thomas paid all taxes on the property and made certain improvements thereon. His wife did not undertake to exercise any control or management of the property. During her lifetime, she stated that the property belonged to her husband and indicated a willingness to make him a deed.
We are of the opinion that under the proof offered no resulting trust arose in favor of the husband.
"Where a husband pays the purchase-money of land from his own funds and has the land conveyed to his wife, the presumption which the law raises is that the husband intended to make a gift to his wife; but the presumption is a rebuttable one, and a resulting trust in favor of the husband may be shown. Parol evidence of the nature of the transaction, or the circumstances, or the conduct of the parties, is admissible to rebut the presumption of a gift; but in order to rebut the presumption of a gift the proof must be clear and convincing." Jackson v.Jackson, 150 Ga. 544 (104 S.E. 236); Browning v. Barber,154 Ga. 221 (113 S.E. 797); Code, § 108-106. In Kimbrough v.Kimbrough, 99 Ga. 134 (25 S.E. 176), this court held: "Where a husband with his own money purchased and paid for a home, and deliberately and intentionally had the same conveyed to his wife, with no understanding or agreement that he was in any event to have an interest in the title, the transaction amounted to a gift from the husband to the wife, and as between them the property became absolutely her separate estate."
In the instant case, the husband's own testimony shows that the entire transaction was without the knowledge of his wife, and with no understanding or agreement that she would hold the property in trust. This evidence negatives an implied trust; it sustains a gift. With the undisputed evidence showing a voluntary, *Page 774 intentional, and deliberate gift of the property by the husband to the wife, who had no knowledge of the transaction, and made no promise or agreement to hold the property for the husband, such gift can not be cut down to an implied or resulting trust by events subsequently transpiring; and therefore the declarations of the wife, after she had knowledge of the deed, as to the ownership of the property, and the payment of taxes and the making of improvements on the property by the husband, are insufficient to establish a resulting trust. Although such declarations and conduct are admissible to rebut the presumption of a gift, they are, under the facts of this case, insufficient to overcome the positive and undisputed evidence showing an outright gift, with no understanding, agreement, or obligation on the part of the donee to hold the property in trust.
As stated in Vickers v. Vickers, 133 Ga. 383, 384 (65 S.E. 885, 24 L.R.A. (N.S.) 1043): "An absolute gift will not be cut down by implication into a trust merely because the donor hoped and believed at the time the gift was made that the donee would share the beneficial interest of the property with him or with a third person. It must appear from the entire transaction that there is an obligation on the part of the holder of the legal title to hold it for the benefit of some one else. If a husband buys and pays for land and takes a deed in his wife's name, a presumption arises that he intends to make an absolute gift to her, and in order to overcome this presumption he must show something which raises an obligation in her to hold the property in trust for him. . . An absolute gift can not, by events transpiring after it is made, be metamorphosed into a trust." See also Jackson v. Jackson, 150 Ga. 544 (104 S.E. 236); Wilder v. Wilder, 138 Ga. 573 (75 S.E. 654); Gibbs v. Gibbs, 151 Ga. 745 (108 S.E. 214); Bell v. Bell,154 Ga. 850 (115 S.E. 645).
The ruling here made is not without recognition of the fact that ordinarily, where the parties are not closely related and one party pays the purchase-price of property and has the conveyance made to another, an inference arises, even in the absence of knowledge of the conveyance by the grantee, that the conveyance is in trust for the payor; and a resulting trust may be established, even without proof of an agreement, understanding, or obligation on the part of the grantee to hold or reconvey. But a case falling within *Page 775 the provisions of the Code, § 108-106, stands upon a different footing. In its last analysis, a resulting trust, as between husband and wife where the husband pays the purchase-money and title is taken in the name of the wife, rests upon the intention of the parties at the time of the transaction, with the presumption being that the transaction was a gift. Parol proof of conduct, circumstances, and declarations is admissible as tending to show the intent of the parties; and such evidence might ordinarily, if sufficiently clear and convincing, authorize a jury to find that the intention of the parties was that the conveyance should be in trust and not a gift. But where, as here, the undisputed testimony of the husband, who seeks to establish the trust, shows a deliberate and intentional gift, such gift can not be cut down to a trust by proof of subsequent events.
The verdict for the defendants was not supported by the evidence.
2. The averments of the answer, seeking to establish a resulting trust, were insufficient. It was not alleged that it was not the intention of the husband to make a gift to his wife; nor are the facts alleged sufficient to rebut the presumption of a gift. The averments fail to show any agreement, or otherwise to show an obligation, on the part of the wife to hold the property for her husband. Accordingly, the court erred in overruling the motion to strike the portion of the answer seeking to set up a resulting trust.
3. It is never error to refuse to direct a verdict.
Judgment reversed. All the Justices concur.