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Shumway v. Earley

Supreme Court of Arizona

October 7, 1940

E. H. SHUMWAY and LOLA M. SHUMWAY, Husband and Wife, and L. D. SHUMWAY, PEARLE SHUMWAY, Husband and Wife, Appellants,
HAROLD L. EARLEY and LILLIAN L. EARLEY, Husband and Wife, Appellees

APPEAL from a judgment of the Superior Court of the County of Pinal. E. W. McFarland, Judge. Judgment affirmed.

Mr. A. S. Gibbons, for Appellants.

Mr. C. W. Stokes, of Albuquerque, New Mexico, for Appellees.


Page 195

[56 Ariz. 125] ROSS, C.J.

Plaintiffs Earley brought this action against defendants Shumway and others to quiet their title to Lots 8, 9 and 10, in Block 16 of the Townsite of Casa Grande, except the northeasterly ninety feet of said lots and other lots which we omit describing as they are not involved in the appeal. Said lots are situated in Pinal county, Arizona. The complaint was in the usual form, that is, that plaintiffs were the owners in fee simple and in possession and that the defendants claimed an estate or interest in the premises adverse to plaintiffs. The defendants by their pleadings denied plaintiffs were the owners of the property and asserted defendants were. Each seeks to have his title quieted against the other. The court, after hearing the evidence, made findings of fact and conclusions of law and rendered judgment for plaintiffs. Defendants Shumway appeal.

[56 Ariz. 126] It appears from the evidence and the court's findings that both parties deraign title from a common source, to wit, through Dan T. Peart, administrator of the estates of William Lee and Lola W. Lee, husband and wife and owners of such lots during their lifetime. Such administrator, on April 10, 1922, conveyed by deed all interest of the estate of Lola W. Lee in and to said lots to one D, without consideration, with the understanding that D would immediately convey the property to the Casa Grande Valley Bank in trust for such estate, or the heir thereof, and on the following day D conveyed his title to said bank; that on August 1, 1922, such administrator made a like conveyance of the interest of the estate of William Lee to one H, with a like understanding, and on the same day H conveyed his title to said bank; the the bank accepted such title and agreed to hold same for the convenience of the administrator, or heir, and to convey to whomever the administrator, or heir, might designate; that the bank paid taxes and assessments on the property for the years 1923 to 1929, inclusive, in the sum of $350.47 but without any authorization from the legal heir or the probate court in which said estates were being administered.

That Thompson Lee was the sole heir of William and Lola W. Lee and entitled to what remained of their estates, after their debts and expenses of administration were paid, a part of which remainder were Lots 8, 9, and 10; that on March 24, 1933, Lee as such sole heir deeded such property to the Earley Land and Investment Company, a corporation, which later conveyed same to the plaintiffs, who, and with their predecessors in interest, have had actual, open, notorious and adverse possession thereof for more than ten years prior to filing their complaint (Oct. 22, 1928).

On June 27, 1932, the bank became insolvent, was taken over by the state banking department and, under [56 Ariz. 127] the supervision of the superintendent of banks as ex-officio receiver, was put through the process of liquidation, and through such proceeding the defendants Shumway claim they

Page 196

became the owners of such lots. The findings in that connection are that the superintendent of banks, under authority from the court in the insolvent proceeding, some time early in 1938 sold to defendants, at public auction en masse, the remaining assets of the bank as set forth and described in Schedule A attached to his petition, but that neither the lots nor any claim for taxes and assessments paid thereon by the bank was set froth in such Schedule A, nor in the notice of sale, nor in the return of sale, nor in the instrument conveying to the defendants the property sold, nor in the order confirming sale to defendants; nor were such lots or taxes and assessments ever listed as assets of the bank in such proceeding.

That on March 22, 1938, and subsequent to such sale en masse to the defendants, the superintendent of banks made to defendants an assignment as follows:

"... all of my right, title and interest of said insolvent bank in and to all moneys due the said Casa Grande Valley Bank by virtue of advances made for the payment of taxes and special assessments in the matter of the Lola W. Lee trust, together with any lien that may ...

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