Opinion
No. 59664-1-I.
March 31, 2008.
Appeal from a judgment of the Superior Court for Whatcom County, No. 05-3-00437-1, Charles R. Snyder, J., entered March 5, 2007.
Affirmed by unpublished opinion per Becker, J., concurred in by Cox and Dwyer, JJ.
During his divorce trial, William Ladner attacked the validity of a community property agreement he signed in Canada nine years earlier that converted his inheritance into a community asset. William argues that medication rendered him incompetent at the time of signing and that the Washington State notary lacked authority to witness the signatures in Canada. Because substantial evidence supports the finding that William was competent and an alleged error in the notarization process would not affect the validity of the agreement, we affirm.
William and Paulette Ladner married in 1991. In 1995, William received an inheritance from his father consisting of approximately $400,000 in cash and stock as well as a 1915 family home in Point Roberts, Washington.
Paulette filed for divorce in 2004. At the dissolution proceeding, the trial court found that their community property agreement was valid and divided the property accordingly.
According to the trial court's unchallenged findings, William deposited the inheritance money in a joint account set up at Charles Schwab in April 1996. The opening balance was over $447,000. Both Paulette and William had access to this money. They used it to pay bills, fund part of the cost of remodeling the Point Roberts house, and buy William a new truck.
William had a massive heart attack on May 3, 1997. Paulette drove him to the nearest hospital which was across the international border in Tsawwassen, British Columbia. According to lab reports introduced at trial, William received a combination of drugs to stabilize his condition, including a hypnotic drug to help him sleep, an anti-anxiety medicine, morphine, and blood thinners. Doctors expressed concern that William remained in danger of sudden death and was in need of heart surgery.
Two days after William's heart attack, Paulette came to the hospital with a community property agreement. Accompanying her was James Julius, a real estate broker and notary public from Point Roberts who had known William for a long time. The agreement, prepared upon a standard form, read:
This agreement, made and entered into this 5th day of May, 1997, by and between William Henry Ladner III and Paulette Lucia Marie Ladner, husband and wife, of Whatcom County, State of Washington, pursuant to the provisions of § 26.16.120 RCW, permitting agreements between husband and wife fixing the status and disposition of community property to take effect upon the death of either, Witnesseth: That, in consideration of the love and affection that each of us has for each other, and in consideration of the mutual benefits to be derived by each of us, it is hereby agreed, covenanted, and promised as follows:
I.
That all property of whatsoever nature or description whether real, personal or mixed and wheresoever situated now owned or hereafter acquired by us or either of us, including separate property, shall be considered and is hereby declared to be community property, and each of us hereby conveys and quit claims to the other his or her interest in any separate property he or she now owns or hereafter acquires so as to convert the same to community property.
II.
That upon the death of either of us, title to all community property as herein defined shall immediately vest in fee simple in the survivor.
Exhibit 5.
Paulette testified that William read and signed the document without discussion. Paulette also signed the agreement. A nurse at the hospital and a real estate associate from Mr. Julius's office witnessed these signatures and signed to that effect. Mr. Julius then took the agreement back to his office in Point Roberts and affixed his notary public seal and certificate of attestation. The notary attestation states:
This is to certify on this 5th day of May, 1997, before me James H. Julius a Notary Public in and for the State of Washington duly commissioned and sworn, personally came William Henry Ladner III and Paulette Lucia Marie Ladner husband and wife, to me known to be the individuals described in and who executed the within instrument, and acknowledged to me that they signed the same as their free and voluntary act and deed for the uses and purposes therein mentioned.
Exhibit 5.
Mr. Julius signed below this attestation.
The trial court determined that the agreement was facially valid and became effective on the date it was signed. William contends the agreement is not valid and enforceable because Mr. Julius, a notary public for the State of Washington, did not have authority to take acknowledgments in Canada and could not remember whether or not he did so.
We need not address whether Mr. Julius performed a notarial act outside the scope of his authority under the Washington statutes concerning notaries. Even if he did, a defect in the notarization process does not invalidate an otherwise proper contract. Ockfen v. Ockfen, 35 Wn.2d 439, 213 P.2d 614 (1950). In that case, Sophia Ockfen conveyed her 160-acre farm to her son John by means of a quitclaim deed. Sophia died eight months later. The administrator of Sophia's estate and her four other children brought an action to cancel the deed. The trial court found that Sophia did not appear before or talk to the notary who had signed the acknowledgment. The trial court nevertheless entered a judgment upholding the quitclaim deed. On appeal, the Supreme Court readily affirmed. Ockfen, 35 Wn.2d at 441. See also Skagit State Bank v. Rasmussen, 109 Wn.2d 377, 389, 745 P.2d 37 (1987) (false acknowledgment by notary did not prevent bank from enforcing the mortgage lien); Davidson v. National Can Co., 150 Wash. 370, 376, 273 P. 185 (1928) (lack of notarial seal on a notice of a construction lien at the time it was recorded "cannot be urged to defeat the lien by anyone other than a subsequent innocent purchaser who relies on the record."); Melovitch v. City of Tacoma, 135 Wash. 533, 539, 238 P. 563 (1925) (failure of notary to affix notarial seal on a claim presented to the city did not bar action).
Williams has not cited authority showing that a defect in an acknowledgment by a notary renders the agreement unenforceable. Instead, he argues that affirming the trial court's ruling will unwisely establish a carte blanche rule that community property agreements need not be notarized, opening the door to endless litigation. However, parties have their agreements notarized precisely because they wish to forestall claims of forgery and coercion. To maintain the utility of notarization, it is not necessary to hold that community property agreements are rendered unenforceable by a defect in the notarization process. Such a holding would elevate a technical form over the much more important substance of a contractual agreement.
On an alternative basis, William contends the community property agreement is invalid because he was not competent when he signed it. However, the court found William was competent. When the trial court has weighed the evidence, appellate review is limited to determining whether the substantial evidence supports the findings and, if so, whether the findings support the conclusions of law. Standing Rock Homeowners Ass'n v. Misich, 106 Wn. App. 231, 242-43, 23 P.3d 520 (2001).
"Evidence is substantial if it exists in a sufficient quantum to persuade a fair-minded person of the truth of the declared premise. So long as substantial evidence supports the finding, it does not matter that other evidence may contradict it." In re Marriage of Burrill, 113 Wn. App. 863, 868, 56 P.3d 993 (2002) (footnote omitted).
Dr. Braun, an expert witness called by William, testified that the combination of medicines William received at the hospital likely rendered him incapable of appreciating that he was agreeing to convert his separate property into community property. The trial court did not accept Dr. Braun's opinion because it was unclear that William signed the agreement at a time when the medications would have been impairing his judgment:
Dr. Braun did not opine as to how long the effects of these drugs occur or last between dosages, and I don't have any professional opinion that they don't clear off or wear off or that they somehow maintain their effects on a person's mental capacity over a long period of time. What we do have is some indication that he received this medication, the one which Dr. Braun said was the one most likely to cause the difficulties in his competency approximately five hours after signing the document, and although Dr. Braun opined that the medical records as provided by the hospital must be incomplete, because they were not properly documented, that's his opinion, and that is not sufficient for the court to determine that, in fact, the list of medications that were given wasn't complete.
. . . .
Dr. Braun's opinion is, in fact, the only professional opinion we have, but it's also an opinion not based upon personal knowledge or upon observation, but merely upon review of the records, and he was unable to state from those records when Doctor — when Mr. Ladner was medicated and how much of these medicines he received and what the effects of those specific doses would be upon Mr. Ladner's condition or his ability to understand what he was doing, and since the burden lays upon the party who is challenging the document to prove that Mr. Ladner was incompetent, I find that that burden has not yet been met in this case.
Report of Proceedings at 331, 333.
William contends that the community property agreement must be set aside because Dr. Braun's testimony was not rebutted. But Paulette was under no obligation to present expert testimony rebutting Dr. Braun. Rather, it was William who had the burden to prove that he was not competent:
It is well settled that the law will presume sanity rather than insanity, competency rather than incompetency; it will presume that every man is sane and fully competent until satisfactory proof to the contrary is presented. In Washington we have held that the standard of proof required to overcome this presumption, in civil cases, is that of clear, cogent and convincing evidence.
Grannum v. Berard, 70 Wn.2d 304, 307, 422 P.2d 812 (1967) (citations omitted).
A court is not required to accept the opinion testimony of experts solely because of their special knowledge; rather, the court decides an issue upon its own fair judgment, assisted by the testimony of experts. In re Marriage of Pilant, 42 Wn. App. 173, 178, 709 P.2d 1241 (1985). A court may reject opinion testimony in whole or in part in accordance with its judgment of the persuasive character of the evidence presented. Pilant, 42 Wn. App. at 178-79. Thus, the court did not have to accept Dr. Braun's opinion. William failed to overcome by clear, cogent, and convincing evidence the presumption that he comprehended the act of signing the agreement.
In addition, both Paulette and Mr. Julius testified there were no indications that William was incompetent when they visited him at the hospital. Mr. Julius testified that he had known William for 60 years. When asked if he would have been able to tell whether William was competent when he signed the community property agreement, Julius answered "I would think so." Julius described William's speech as "normal" and testified that he would not have notarized the agreement if he thought William was not competent:
Report of Proceedings at 109.
Q. Now, Mr. Ladner has been a friend of yours or acquaintance of yours virtually all your life. You live in a small town. You know him pretty well. You went to the Reef Tavern. You had a beer with him. You had a chat with him. . . . Now, Mr. Kosanke has developed a scenario where Mrs. Ladner was attempting to do something sort of surreptitiously, or get you to sign this or get you to notarize this and kind of pull one over on Bill when he was in the hospital —
MR. KOSANKE: Objection. I did not even imply that.
MS. BERG: Would you —
THE COURT: I think it was implied.
Q. (By Ms. Berg) Would you have been a party to something like that with your friend Bill if you didn't think that this is a document that both Mr. and Mrs. Ladner wanted to sign, wanted to have done at the time? Would you have been involved in — would you have notarized it, or signed it, or sent it to the title company if you thought that this wasn't something that they were both in agreement with?
A. No.
Report of Proceedings at 128-29.
Paulette testified that William was sitting up reading a magazine when she arrived at the hospital. When she handed William the community property agreement it appeared to her that he read it. This was substantial evidence supporting the trial court's finding of competency.
Paulette requests fees as a prevailing party on the basis that William's appeal is frivolous. RAP 18.9(a). We deny this request.
Affirmed.
WE CONCUR: