Adamson v. Adamson
541 P.2d 460 (1975)
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Rule of Law:
A conveyance of real property is void as fraudulent if it is made with the intent to hinder a person's lawful rights in a contemplated lawsuit, such as a divorce proceeding, especially when the conveyance is procured through the abuse of a confidential relationship. When a married couple and a third party are named as co-buyers on a contract, the married couple is treated as a single entity, holding a one-half interest as tenants by the entirety, and the third party holds the other one-half interest.
Facts:
- Margaret Adamson married Brian Adamson, the son of Joel and Inez Adamson.
- Brian located a fourplex apartment building for purchase, and his mother, Inez, provided the $5,000 down payment.
- On May 20, 1965, a land sale contract was executed listing the buyers as 'Brian J. Adamson and Margaret Adamson (husband and wife) and Inez T. Adamson.'
- Margaret and Brian lived in and managed the fourplex for approximately two years.
- As Margaret and Brian's marriage deteriorated and a divorce became imminent, Brian's father, Joel Adamson, orchestrated a plan to transfer the couple's interest in the property to himself.
- On April 14, 1972, Joel Adamson drove a pregnant and ill Margaret to a bank and had her sign a deed conveying her and Brian's interest in the fourplex to him.
- Margaret, who had a confidential and trusting relationship with her father-in-law, signed the document without reading it, believing it was a correction for a different property transaction.
- The deed stated a consideration of $850, but no money was ever paid to Margaret or Brian for the transfer.
Procedural Posture:
- Margaret Adamson filed a petition for divorce from Brian Adamson.
- The divorce court issued a decree awarding Margaret all of the parties' right, title, and interest in the fourplex.
- Margaret Adamson (plaintiff) filed suit in trial court against Inez T. Adamson to determine their respective equitable interests in the property.
- Inez Adamson conveyed her interest to her ex-husband, Joel Adamson, who was then added to the lawsuit as the defendant-intervenor.
- The trial court decreed that Margaret owned a two-thirds interest and Joel owned a one-third interest, voided the 1972 deed to Joel, and awarded attorney fees to Margaret.
- Joel Adamson (defendant-intervenor) appealed the trial court's judgment to the Supreme Court of Oregon.
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Issue:
Does a deed conveying a spouse's property interest constitute a voidable fraudulent conveyance when it is obtained through duress and the abuse of a confidential relationship with the intent to prevent the other spouse from recovering that interest in a contemplated divorce proceeding?
Opinions:
Majority - Bryson, J.
Yes. A deed constitutes a voidable fraudulent conveyance when it is procured through the abuse of a confidential relationship with the intent to prevent a spouse from recovering a property interest in a future divorce. The court found that a confidential relationship existed between Margaret and her father-in-law, Joel, which he abused through misrepresentation and coercion to obtain her signature on the deed. The evidence clearly showed the conveyance was orchestrated to hinder or delay Margaret from recovering Brian's equitable interest in the fourplex during the imminent divorce proceedings, which is defined as a fraudulent conveyance under Oregon law. Therefore, the deed is void. The court further held that under the original contract, Margaret and Brian, as a marital entity, held a one-half interest as tenants by the entirety, and Inez held the other one-half interest. Following the divorce decree that awarded Brian's interest to Margaret, Margaret now holds the entire one-half interest.
Analysis:
This decision reinforces the court's willingness to look beyond the form of a transaction to its substance, particularly in intra-family disputes involving allegations of fraud or undue influence. It establishes that a conveyance intended to shield assets from a spouse in an anticipated divorce qualifies as a fraudulent conveyance that can be set aside. The ruling also clarifies the default ownership structure for property acquired by a married couple jointly with a third party, applying the common law fiction of marital unity to grant the couple a single, undivided share as tenants by the entirety. This precedent provides a crucial protection for spouses against asset-hiding schemes on the eve of divorce and sets a clear rule for property co-ownership.
