Eugene Fuchs, Respondent, vs. Sylvia J. Habstritt, Appellant.

This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480 A. 08, subd. 3 (1994) State of Minnesota in Court of Appeals C0-96-644 Eugene Fuchs, Respondent, vs. Sylvia J. Habstritt, Appellant. Filed October 15, 1996 Affirmed Schumacher, Judge Hubbard County District Court File No. C89491 James A. Wellner, London Anderson Antolak & Hoeft, Ltd., 2250 One Financial Plaza, 120 South Sixth Street, Minneapolis, MN 55402 (for Respondent) John E. Valen, Fifth and Michigan, Post Office Box 1105, Walker, MN 56484 (for Appellant) Considered and decided by Short, Presiding Judge, Parker, Judge, and Schumacher, Judge. Unpublished Opinion SCHUMACHER, Judge (Hon. Jodie Metcalf, District Court Trial Judge) Appellant Sylvia J. Habstritt claims errors in the trial court's findings of fact and application of Minn. Stat. § 501B.07 (1994) regarding ``purchase money resulting trusts.'' We affirm. Facts Habstritt and respondent Eugene Fuchs met in 1986 and began a romantic affair. Habstritt was single, but Fuchs was married. In 1989, the parties were involved in the purchase of real estate in Grand Marais, Minnesota. Fuchs personally paid the full purchase price, but title was placed in Habstritt's name in order to avoid procuring Fuchs's wife's signature on the deed and to avoid obtaining his wife's approval on any future transactions involving the property. In 1992, when the parties sold this property, Habstritt signed all the documents as title holder and transferred all proceeds from the sale to Fuchs. In 1991, the parties were involved in the purchase of a lot and cabin in Park Rapids, Minnesota. Fuchs again paid the full purchase price and title was again placed in Habstritt's name. In June 1991, shortly after the purchase of the Park Rapids property, an attorney prepared a will for Habstritt, which provided as follows: (1) if Fuchs were to die before Habstritt, his estate would have no interest in the Park Rapids property; (2) if Habstritt were to die before Fuchs, then Fuchs would inherit the property; and (3) Habstritt would not sell the property without first obtaining the consent of Fuchs. At the time, both parties used the Park Rapids property as their weekend get-away. In the fall of 1992, Habstritt moved to Park Rapids and made the cabin her permanent home. Habstritt paid the telephone and electric bills and real estate taxes, and the property was classified as homestead property in her name. In February 1993, Habstritt suffered a subarachnoid hemorrhage. Fuchs visited Habstritt in the hospital and she signed a deed transferring the Park Rapids property to him. Fuchs was primarily concerned that a medical lien would be placed against the property. Soon thereafter, Habstritt had a stroke and she presently suffers from a loss of memory and a difficulty articulating her thoughts. Habstritt continued to live in the Park Rapids cabin, although her relationship with Fuchs ended. Fuchs brought this action seeking return of the property or damages, and Habstritt counterclaimed seeking a declaration that the deed transferring the Park Rapids property to Fuchs was null and void. After a one-day court trial, the trial court concluded that Habstritt's signature on the deed was obtained through undue influence and declared the deed null and void. Nevertheless, the court found the circumstances surrounding the purchase of both properties manifested an intention by Fuchs to create a resulting trust on each occasion, pursuant to Minn. Stat. § 501B.07. The trial court denied Habstritt's motion for amended findings and she appeals. Decision 1. On appeal from a court trial, the scope of review is limited to determining whether the trial court's findings are clearly erroneous and whether it erred in its conclusions of law. Minn. R. Civ. P. 52.01; Thuma v. Kroschel, 506 N.W.2d 14, 18 (Minn. App. 1993), review denied (Minn. Dec. 14, 1993). Clearly erroneous means ``manifestly contrary to the weight of the evidence or not reasonably supported by the evidence as a whole.'' Northern States Power Co. v. Lyon Food Prods., 304 Minn. 196, 201, 229 N.W.2d 521, 524 (1975). Due regard shall be given to the trial court's opportunity to judge the credibility of the witnesses. Minn. R. Civ. P. 52.01; Thuma, 506 N.W.2d at 18. Minn. Stat. § 501B.07 (1994), entitled ``purchase money resulting trusts,'' provides that [i]f a transfer of property is made to one person and the purchase price is paid by another, a resulting trust is presumed to arise in favor of the person by whom the purchase price is paid * * *. The statute contains three exceptions, two of which apply to the instant action: (1) if the person by whom the purchase price is paid manifests a contrary intention, no resulting trust is presumed to arise; and (2) if the transferee is a spouse, child, or other natural object of bounty of the payor, a gift in favor of the transferee is presumed and no resulting trust is presumed to arise. Id. 2. Habstritt argues that the trial court erred in its conclusion that Fuchs did not ``manifest a contrary intention'' pursuant to section 501B.07(1). The trial court noted that, ``although there was some evidence that the parties intended that the Park Rapids property would be their retirement home, the Court does not find such evidence convincing.'' The trial court had a first-hand opportunity to judge the credibility of the witnesses and found it ``highly unlikely'' that Fuchs would ever make a gift of the Park Rapids property to Habstritt. The trial court's finding is not clearly erroneous, and the court did not err in its conclusion that section 501B.07(1) was inapplicable. 3. Habstritt argues that the trial court erred in its conclusion that she was not a natural object of Fuchs's bounty, pursuant to section 501B.07(2). We disagree. The trial court stated that Black's Law Dictionary defines ``natural object of bounty'' as those persons who would take from a testator in the absence of a will. The complete definition of ``natural object of testator's bounty'' is as follows: In testamentary law, term comprises whoever would take, in the absence of a will, because they are the persons whom the law has so designated, and in the ordinary case the law follows the normal condition of near relationship. Black's Law Dictionary 1027 (6th ed. 1990). The trial court relied on an acceptable definition of natural object of bounty and did not err in its conclusion that section 501B.07(2) did not apply to the facts. Affirmed.