Avance v. Richards

Jack AVANCE, Jr., Robert Shelby, and Carmon
Wigley v. Virginia R. RICHARDS

97-134                                             ___ S.W.2d ___

                    Supreme Court of Arkansas
               Opinion delivered January 15, 1998


1.   Banks & banking -- joint account with right of survivorship --
     Ark. Code Ann.  23-32-1005 controlling. -- Arkansas Code
     Annotated  23-32-1005 makes the creation of a joint bank
     account with right of survivorship "conclusive evidence" of
     the parties' intent that the account is to pass to the
     survivor upon the death of the other; it is error for a
     chancellor to consider other evidence of the decedent's
     intent; the statute also makes the establishment of a joint
     account with right of survivorship conclusive of the deceased
     depositor's intent.

2.   Appeal & error -- review of chancery cases -- sufficient
     documentation existed for supreme court to decide issues
     without remand. -- The supreme court reviews chancery
     decisions de novo, and when the record is sufficiently
     developed, decides the issues presented without remand; here,
     there was sufficient documentation to make such a decision.

3.   Wills -- reciprocal wills discussed. -- A contract for
     reciprocal wills need not be expressed in the wills but may
     arise by implication from circumstances that make it clear
     that the parties had such wills in mind and that they both
     agreed to the terms of the testamentary disposition made
     therein. 

4.   Wills -- only provision concerning real property found
     "mutual" -- wills here not reciprocal. -- Where the husband's
     1976 will permitted his wife, if she survived him, to do as
     she pleased with personal property, and the wife's 1976 will
     inconsistently provided that her husband could dispose of
     personalty at his "own decision" but expressed her wish that
     "monies" be divided equally between the heirs of each side of
     the family, the supreme court determined that while the
     provisions concerning real property were "mutual," there was
     doubt with respect to personalty, such as the money the wife
     placed in the joint account with right of survivorship.

5.   Wills -- creation of reciprocal wills -- execution does not
     create presumption of contract not to revoke will. -- The
     execution of a reciprocal or mutual will does not create a
     presumption of a contract not to revoke a will.

6.   Wills -- reciprocal wills -- contract not to revoke will --
     proof required. -- Where reciprocal wills say nothing about a
     contract not to revoke, the mere fact that the wills are
     reciprocal is not enough with which to infer such a contract;
     a party seeking to prove a contract not to revoke a will must
     do so by "clear, cogent, and convincing evidence"; such a
     contract is like a contract to make a will; the fact that the
     parties have concurrently executed separate wills, reciprocal
     in terms, is not sufficient, of itself, to show that the
     parties had entered into a contract to make such wills; but
     the terms of such wills afford some evidence of the
     contractual relation and, when read in connection with other
     evidence which tends to show the execution of the contract,
     may establish that fact. 

7.   Wills -- decedents' wills did not contain contract not to
     revoke -- chancellor's refusal to impose constructive trust
     affirmed. -- Where the will in issue contained a provision
     permitting disposition of any of the property at the husband's
     "decision," the supreme court found that the 1976 wills of the
     deceased husband and wife did not contain a contract not to
     revoke; the "other evidence" was not "clear, cogent, and
     convincing" of the existence of such a contract; the
     chancellor's refusal to impose a constructive trust was
     affirmed.


     Appeal from Crawford Chancery Court; Jim Spears, Chancellor;
affirmed.
     Lawrence W. Fitting, P.A., for appellants.
     Bagby Law Firm, P.A., by:  Philip Bagby, for appellee. 
     
     David Newbern, Justice.
     Smith and Etta Jordan, husband and wife, each wrote a

holographic will on July 8, 1976.  The documents contained common
provisions leaving property to the survivor.  Ms. Jordan survived
Mr. Jordan.  In 1990, Ms. Jordan placed money in a joint checking
account with right of survivorship.  The other person named as
depositor was appellee Virginia Richards.  At the time of Ms.
Jordan's death in 1995, the account contained approximately
$121,700.  Ms. Richards, who served as executrix of a later will
executed by Ms. Jordan, removed the money from the account after
being advised by an attorney that the money was hers.    
     The question we must answer is whether there was a contract
between the Jordans that was breached when Ms. Jordan effectively
removed money from her estate, after Mr. Jordan's death, by
establishing the survivorship account.  The Chancellor held that
Ark. Code Ann.  23-32-1005 (Repl. 1994) conclusively placed
ownership of the money in Ms. Richards as the surviving person on
the account.  We affirm the result reached by the Chancellor but
for the reason that there was insufficient evidence of a contract
binding Ms. Jordan to leave the money in question to Mr. Jordan's
beneficiaries in accordance with her 1976 will.
     Mr. Jordan's will contained this provision:
     
     I do hereby give, devise and bequeath all my estate and
     property which I may own at my death real personal and mixed
     and wheresoever situated of every kind sort and description to
     my wife Etta Jordan.  She may dispose of the personal property
     at her decision but the real estate cannot be sold, bartered
     or disposed of in any manner without the signature of my heirs
     namely - Hester Avance Junior Avance Carmen Wigley, Robert
     Shelby and Donald Sanders and they get their share of the
     property (50%) at the time of transaction to be divided as
     other monies and property which will be described in paragraph
     marked (Fourth).  The other half (50%) will go to my wife if
     living and to her heirs if she predecease me. 

     The document written by Ms. Jordan contained a provision that
was virtually the same as Mr. Jordan's but making him the
beneficiary and providing for distribution of her fifty percent to
her sister and nieces and nephews.  This provision also appeared in
Ms. Jordan's document: "At his (Smith's) death it is my wish that
all of our estate be divided--50% of our estate, property and
monies will go to my heirs and 50% will go to my husband's (Smith
Jordan's) heirs."  The 1976 document signed by Ms. Jordan also
provided that if Mr. Jordan survived her he could dispose of
personal property "at his own decision." 
     On January 26, 1984, Ms. Jordan executed a second typewritten
will that purported to revoke all prior wills.  The 1984 will
incorporated the "50-50" disposition featured in the Jordans' 1976
wills:

     I further recognize that it has been the desire of my
     deceased husband and myself that at the death of the
     survivor of the two of us, that the Estate of the
     survivor should be divided one-half to his side of the
     family and one-half to my side of the family.  In the
     past we have both had Wills to this effect.  It is my
     desire that in this now my last Will, these intentions be
     carried out.

     Attorney Zed Gant prepared Ms. Jordan's 1984 will and retained
the original 1976 documents in his file.  The estate of Ms. Jordan,
not including the money from the joint account that passed to Ms.
Richards as the surviving party to the account, was valued in
documents submitted in connection with Ms. Jordan's 1984 will at
$308,511.19.  That remaining property presumably was distributed
among Mr. and Ms. Jordan's beneficiaries in accordance with the
1984 will.
     None of these wills, or any other documents executed by the
Jordans, expressly referred to a "contract" not to revoke a will.
     On July 13, 1990, Ms. Jordan changed the status of the
checking account she had opened at the Bank of Mulberry on March
12, 1981.  Ms. Jordan added Ms. Richards's name to the account and
changed it from an "individual" account to a joint account "with
survivorship."  Both Ms. Jordan and Ms. Richards signed the
signature card.  The account agreement explained that the funds
would pass to the survivor upon the death of the other party. 
     Ms. Richards contributed no funds to the account and conceded
in a deposition that Ms. Jordan added her name to the account so
that she would be able to pay Ms. Jordan's expenses.  She was
unaware of her right of survivorship in the account until after Ms.
Jordan's death.  
     Ms. Jordan, who had been living with Ms. Richards, died on
November 6, 1995.  Ms. Richards petitioned the Probate Court for
probate of the 1984 will on November 28, 1995.  She filed an
inventory on March 15, 1996, and did not list the $121,700 in the
checking account.  As Ms. Richards indicated in her deposition,
Paul Gant, an attorney for Ms. Jordan's estate (who also is the son
of Zed Gant, the attorney who prepared Ms. Jordan's 1984 will),
advised Ms. Richards that the funds passed directly to her and were
not part of Ms. Jordan's estate.  
     In their action against Ms. Richards, Mr. Jordan's heirs
claimed that Etta Jordan breached her agreement with Smith Jordan
not to revoke her will and that they were entitled to specific
performance of the agreement and thus to have the constructive
trust imposed.  They sought an order directing Ms. Richards to
transfer the money and any proceeds from it into the Trial Court's
registry and ultimately to Ms. Jordan's estate for distribution in
accordance with the 1976 or 1984 will of Ms. Jordan.
     Ms. Richards moved for summary judgment and asserted (1) her
right to the funds from the account on the basis of  23-32-1005
regardless of any contract embodied in the 1976 wills; and (2)
alternatively, there was no valid contract in the first instance
that limited Ms. Jordan's ability to dispose of some of her
property by placing it in a joint and survivor account with Ms.
Richards.
     Mr. Jordan's heirs responded with their own motion for summary
judgment and asserted that the 1976 wills implicitly created the
contract not to revoke.  They also relied on Ms. Jordan's 1984 will
and affidavits of persons who said they had heard statements by Mr.
and Ms. Jordan concerning their plan to divide their property
equally between the two sets of heirs.
     The affidavit of Robert Shelby, Mr. Jordan's nephew, was to
the effect that he had a serious conversation with Mr. Jordan
shortly before Mr. Jordan's death in which Mr. Jordan expressed his
wish that, at Ms. Jordan's death, their property be divided on the
50-50 basis expressed in his will.  Mr. Jordan abjured Mr. Shelby
to see to it that it went as he wished.  Apparently nothing was
said about a contract.
     The affidavit of Edwina Brooks, wife of a nephew of Ms.
Jordan, stated that Ms. Jordan had told her about the 50-50
distribution plan and that she and Mr. Jordan had agreed "by their
wills" that half their estate would go to his side of the family
and that half would go to her side of the family.  An affidavit by
Roberta Benham, a niece of Ms. Jordan, reported that Ms. Jordan had
told her that she and her deceased husband were "a company" and
that everyone would share and share alike.
     The Chancellor granted Ms. Richards's motion for summary
judgment relying on  23-32-1005 and this Court's holdings in
Nichols v. Wray, 325 Ark. 326, 925 S.W.2d 785 (1996), and Hall v.
Superior Federal Bank, 303 Ark. 125, 794 S.W.2d 611 (1990).  He
stated he was precluded from considering the arguments that the
Jordans had entered into a contract not to revoke their wills and
that Ms. Jordan's possible intent that Ms. Richards inherit the
money in the checking account was irrelevant.  The Chancellor found
there was no genuine issue of material fact "that the money which
was in the account on the date [of] Decedent's death became the
property of Respondent [Ms. Richards] as the joint tenant by
operation of law.  Accordingly, Respondent's Motion for Summary
Judgment is granted."  
     In the Hall case, we held that  23-32-1005 made the creation
of a joint bank account with right of survivorship "conclusive
evidence" of the parties' intent that the account was to pass to
the survivor upon the death of the other and that it was error for
the Chancellor to have considered other evidence of the decedent's
intent.  
     In the Nichols case, we reaffirmed the Hall decision and held
that the statute was controlling of the distribution of the joint
account with right of survivorship.  There, the decedent had
declared her intent in her will to dispose of her estate equally
among her three daughters.  Only one of the daughters' names had
been placed on several joint accounts with right of survivorship. 
We held that the statute made the establishment of the joint
account with right of survivorship conclusive of the deceased
depositor's intent.  While the case involved a conflict between the
terms of a will and the terms of the statute, neither it nor the
Hall decision involved a contract not to revoke.
     The entire argument of Mr. Jordan's heirs rests upon their
contention that there was a contract not to revoke that has been
breached by Etta Jordan.  The Chancellor by-passed the issue of
whether there was such a contract and, in effect, held that it did
not matter in view of the statute and our interpretation of it.  We
are unwilling, based on the facts before us, to hold that  23-32-
1005 precludes the establishment of a constructive trust when a
contract not to revoke a will has been properly established and the
property in question has been transferred in violation of such a
contract.  Again, the question here is whether the existence of
such a contract has been proven.  Both parties, during oral
argument, made it clear that we should decide the issue on its
merits.
     We review chancery decisions de novo, and when the record is
sufficiently developed to enable us to do so, we decide the issues
presented without remand.  Cochran v. Cochran, 309 Ark. 604, 832 S.W.2d 252 (1992); Lynch v. Brunner, 294 Ark. 515, 745 S.W.2d 115
(1988).  In addition to Ms. Jordan's 1984 will, we have before us
the 1976 documents as well as the affidavits mentioned above.  We
regard the record as sufficiently developed to hold that Ms.
Richards must prevail. 
     A "contract for reciprocal wills need not be expressed in the
wills, but may arise by implication from circumstances which make
it clear that the parties had such wills in mind and that they both
agreed to the terms of the testamentary disposition made therein." 
Iwerson v. Dushek, 260 Ark. 771, 774, 543 S.W.2d 942, 944 (1976),
citing Janes v. Rogers, 224 Ark. 116, 271 S.W.2d 930 (1954).  In
the case of Mr. Jordan's 1976 will, the "testamentary disposition
therein" permitted Ms. Jordan, if she survived him, to do as she
pleased with personal property.  Later there was the provision for
the division of real estate among certain persons "to be divided as
other monies and property...."  In the case of Ms. Jordan's 1976
will, there was an inconsistency because she wrote that Mr. Jordan
could dispose of personalty at his "own decision" but expressed her
wish that "monies" be divided equally between the heirs of each
side of the family.  While it might be said that the provisions
concerning real property were "mutual," there is doubt with respect
to personalty such as the money Ms. Jordan placed in the joint
account with right of survivorship.
     Even if the 1976 documents were construed as attempts to
create mutual or reciprocal wills with respect to the money in
question, that would not support a conclusion that Ms. Jordan had
made a contract not to revoke the provisions in her 1976 will.  
     Since 1981, we have had a statute in effect providing as
follows:

     (b)(1) However, a contract to make a will or devise, or
     not to revoke a will or devise, or to die intestate, if
     executed after June 17, 1981, can be established only by:
          (A) Provisions of a will stating material provisions
     of the contract; or
          (B) An express reference in a will to a contract and
     extrinsic evidence proving the terms of the contract; or
          (C) A writing signed by the decedent evidencing the 
     contract.
     (2) The execution of a reciprocal or mutual will does not
     create a presumption of a contract not to revoke a will.

Ark. Code Ann.  28-24-101 (1987) (emphasis added).  While the
statute obviously does not apply in this case, it amounts, at least
in part (b)(2), to a codification of the prior law that does govern
here.
     In Barksdale v. Carr, 235 Ark. 578, 361 S.W.2d 550 (1962), a
husband and wife had made reciprocal wills, each conveying all of
his or her estate to the other with a provision for dividing the
estate of the survivor equally among six children--three from his
former marriage and three from her former marriage.  Mr. Carr died,
and Ms. Carr then revoked her will and conveyed property to her
children contrary to the terms of the will she had revoked.  Mr.
Carr's children sued Ms. Carr's children, claiming that Ms. Carr's
will was irrevocable.  We held that the evidence was insufficient
to support the claim of a contract not to revoke.  We declined to
consider evidence of statements Mr. Carr had made prior to his
death on the ground that "one party to an alleged contract cannot
bind the other party by declarations made in the absence of the
other party."  235 Ark. at 583, 361 S.W.2d  at 553.  We noted that
the wills said nothing about a contract not to revoke and that the
mere fact that the wills had been reciprocal was not enough for us
to infer such a contract.  We concluded that a party seeking to
prove a contract not to revoke a will must do so by "clear, cogent,
and convincing evidence."  235 Ark. at 586, 361 S.W.2d  at 555.  We
noted that such a contract is like a contract to make a will.  When
there is an allegation of a contract to make a will, the standard
requiring clear, cogent, and convincing evidence has consistently
been applied.  See, e.g., Apple v. Cooper, 263 Ark. 467, 565 S.W.2d 436 (1978); Kelley v. Pipkin, 268 Ark. 1009, 598 S.W.2d 102 (Ark.
App. 1980).  In the Barksdale case, we quoted Justice Millwee's
opinion in Janes v. Rogers, supra, as follows:

          The fact that the parties have concurrently executed
     separate wills, reciprocal in terms, is not sufficient, of
     itself, to show that the parties had entered into a contract
     to make such wills; but the terms of such wills afford some
     evidence of the contractual relation and, when read in
     connection with other evidence which tends to show the
     execution of the contract, may establish that fact.  Page on
     Wills, Sec. 1710; Annotation on Joint, Mutual and Reciprocal
     Wills, 169 A.L.R. 9.

Barksdale v. Carr, 235 Ark. at 584, 361 S.W.2d  at 554.
     One of the cases relied upon by Mr. Jordan's heirs in their
brief and cited to us in oral argument in response to questions
concerning the existence of a contract not to revoke is Smith v.
Estate of Smith, 293 Ark. 32, 732 S.W.2d 154 (1987).  In that case,
a joint will consisting of a single document signed by husband and
wife contained reciprocal provisions leaving property to the
survivor and providing that upon the death of the survivor the
property was to be divided equally among children and
grandchildren.  Ms. Smith died, and Mr. Smith petitioned for a
construction of the will.  He contended the will imposed no
restriction on the sale, transfer, or other alienation of the
property.  We held that Mr. Smith could use the property for
necessities, support, and maintenance but could not otherwise
alienate it.   
     The difference between the Smith case and this one is that the
Smiths' will contained no provision permitting disposition of any
of the property at his or her "decision."  More important, it
provided, "We intend that this be a mutual will, which will is
executed on July 27, 1985, and pursuant to an agreement between us
to make mutual wills, each leaving his property to the survivor and
each agreeing that the survivor leaves his property to the heirs
listed...." Smith v. Estate of Smith, 293 Ark. at 33, 732 S.W.2d  at
155 (emphasis added). 
     The 1976 wills of the Jordans do not contain a contract not to
revoke.  The "other evidence" is not "clear, cogent, and
convincing" of the existence of such a contract.  We affirm the
Chancellor's refusal to impose a constructive trust. 
     Affirmed.