IN RE: ESTATE of William Harry WESTERMAN (1967)

Appellant protests that the probate court was in error in decreeing, in response to the administrator's petition to determine heirship, that he is not entitled to certain property of the Estate of William Harry Westerman, Sr., under his assertion thereto based on section 229 of the Probate Code.

This section provides, in summary, that if a person dies intestate without leaving spouse or issue, and leaves property which had originally been the separate property of a previously deceased spouse, and had been received by decedent from that spouse, certain heirs of the previously deceased spouse shall take the property.   Decedent herein died intestate on February 12, 1964, and left no spouse or issue.   The property in dispute had originally belonged to his first wife, appellant's mother, and appellant is the sole heir of his mother.   But the question is whether the property at time of death came from appellant's mother or was acquired under a “new title.”

Appellant's mother had been married to Bambridge, father of appellant Frank Bambridge.   In 1903, she married Westerman.   She died intestate in 1911.   The Westermans had a daughter, who dies as an infant, and a son, who predeceased his father, leaving neither spouse nor issue.   Westerman remarried in 1920.   His second spouse predeceased him in 1950, leaving no issue.   If section 229 be not applicable, respondents, as the heirs at law of Westerman, Sr., are entitled, as the court decreed, to the disputed property.

Appellant's mother, Jane Dwyer Bambridge Westerman, owned three parcels of real property as her separate property at the time of her death in 1911.   These three parcels comprise part of the estate of Westerman;  there is a fourth parcel in the estate, which came to Westerman from his second wife.   Appellant makes no claim to this parcel but there is a relevance of this property to the case as appears below.  (All four parcels were sold during probate but, of course, the moneys received are merely a substitute, and the proper distribution of title to the real property, had it been kept, is determinative as to the proceeds, and the discussion herein is in terms of real property.)

When appellant's mother dies, one-third was distributed to William H. Westerman, Jr.   Appellant lays no claim to this one-third, so far as it now comprises part of the real property of the senior Westerman's estate.   A second third was distributable to appellant, but before distribution of his mother's estate in 1915, appellant deeded this to his stepfather, Westerman, Sr.   Appellant makes no claim to this one-third.   But the final one-third of Janes' estate was distributed to Westerman, Sr., her surviving spouse, as his share under the laws of succession.   This one-third appellant asserts, was always subject to the eventuality that the provisions of the underlying law, section 229, would come into operation.   On the death of Westerman, Sr., intestate and without spouse or issue, appellant contends, title to this one-third devolved upon him.

But two transactions relating to title to the property occurred during the lifetime of Westerman, Sr., by each of which, the probate judge concluded, Westerman, Sr. acquired a new title so that appellant is not entitled, by virtue of section 229, to any portion of the estate.

The first transaction occurred on March 4, 1929.   On that date, decedent and his second wife deeded to decedent's son, Westerman, Jr., two-thirds interest in three parcels of property which had originally been the property of decedent's first wife.   They did not convey the entire title, because the son owned one-third.   Besides this, decedent and his (second) wife deeded the fourth parcel, which really was the (second) wife's separate property, to decedent's son.   On the same date, the son conveyed all four parcels back to decedent and his wife as joint tenants.   Thus, the son parted with his one-third interest in the three parcels which had been owned by his mother (also appellant's mother), decedent's first wife.   The deed back recited a consideration, and the court found that it was given for a consideration.   On June 23, 1950, an order establishing the fact of death of decedent's (second) wife on January 11, 1950, was made.

 The law of “new title” as precluding the operation of section 229 of the Probate Code was first recognized in Estate of Putnam, 219 Cal. 609, 28 P.2d 27, and has been applied in Estate of Flood, 55 Cal.App.2d 410, 130 P.2d 811, Estate of Bishop, 209 Cal.App.2d 48, 25 al.Rptr. 763, and Estate of Blume, 241 Cal.App.2d 496, 50 Cal.Rptr. 622.   The theory is that section 229 has the limited purpose of benefiting the natural objects of the bounty of the former owner, but it does not prevent the former owner's surviving spouse from disposing of the property and, if he does part with it, receiving it again by new conveyance.   Thus, in Estate of Putnam, supra, a woman inherited property from her first husband, converted it to stock in joint tenancy, and later received the stock in her own name by inter vivos termination of the joint tenancy.   On her death, her heirs were not entitled to the property because the woman's intervening act had terminated the original status of the property.

 But appellant contends that in 1929 no real transfer of title to decedent's one-third interest occurred, because in essence the transaction was one to create a joint tenancy interest for decedent's second wife, and Westerman, Jr., was merely a “strawman” to take nominal title momentarily and to reconvey.   Appellant points out that during the years preceding the amendment to section 683 of the Civil Code, effective August 14, 1929 (Stats.1929, ch. 93, p. 172), which allowed a holder of title to convey to himself and to another in joint tenancy, it was common practice to use the device of deeds out and back, the first grantee (often a title company) being in effect a trustee.

That this was common practice is well known (13 Cal.Jur.2d, Cotenancy, § 11, pp. 297–298), and we notice it judicially.  (Whether as a matter of law the practice was necessary, that is, whether the 1929 amendment really changed the law or merely clarified the law as it had existed, is debated in the briefs, but we need not decide this, because appellant's argument, if valid, would be equally so if it was generally understood that the double conveyancing was probably required to satisfy the law and commonly required by title companies.)

 We sustain the judgment of the trial court.   We need discuss the 1929 transaction only, since we conclude that by it new title was acquired by decedent.   Even if, in one sense or to some degree, the son, the grantee, was acting as a “strawman,” it does not follow that the transaction was merely a formal and technical one, involving no substantial change in title.   If we look to the whole transaction and, of course, do so in the light of the trial judge's findings and conclusions, we see that decedent received substantial benefits as well as giving some.   From his son, he and his wife received the one-third which Westerman, Jr. had inherited from his mother.   Decedent received from his wife a joint tenancy interest in the parcel which was her separate property.   That there was consideration running to decedent for the transaction, above that which is presumed from the written instrument itself, is apparent.   In fact, as things turned out, decedent gained by the transaction because his wife, his cotenant, predeceased him.

The case is to be distinguished from Estate of Abdale, 28 Cal.2d 587, 170 P.2d 918, in which the decedent had created a joint tenancy of himself with his wife, who predeceased him, the conveyance having been a pure gift, without any consideration, of an interest in land which had been his separate property.   It was held that his reacquiring the given interest on the death of the wife did not constitute new title.   The case is also distinguishable from Estate of Rudman, 85 Cal.App.2d 270, 193 P.2d 39, in which the decedent's brother had caused property which he bought to be placed in joint tenancy of himself, decedent, and decedent's husband.   When decedent's husband predeceased her (following the death of the brother), the termination of the husband's interest, with consequent vesting of the entire estate in decedent, did not constitute a transfer to the wife.   In the case before us, it may be that Westerman, Sr.'s second wife would not have deeded her separate property to the son, then to be transferred to herself and her husband in joint tenancy, unless the whole arrangement were deemed to create a new title in both spouses.

The judgment is affirmed.

DEVINE, Presiding Justice.

RATTIGAN and CHRISTIAN, JJ., concur.