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Callwood v. Kean.

decided: April 23, 1951.


Author: Maris

Before MARIS, GOODRICH and WOODBURY, Circuit Judges.

MARIS, Circuit Judge.

The plaintiff, Else E. Callwood, has appealed from the judgment entered by the District Court of the Virgin Islands in a suit brought by her against the defendant, Osmond Kean, her former agent, for an accounting of his transactions as her agent and to recover certain mortgages and moneys in his possession which she alleges belong to her. The mortgages and moneys in controversy had been derived from the sale of certain real estate in the town of Charlotte Amalie, on the island of St. Thomas. The defendant, pursuant to a preliminary order of the court, furnished the plaintiff with an accounting and deposited the mortgages, other documents and check books in question with the clerk of the court. Thereafter Clifford W. L. Callwood intervened as a party defendant, with leave of court, claiming an interest in the real estate in question. The issue presented to the district court thereupon became one between the plaintiff and the intervening defendant and involved their respective rights in the proceeds of that real estate.

The plaintiff, Else E. Callwood, and the intervening defendant, Clifford W. L. Callwood, are the widow and son, respectively, of Richard Edgar Clifford Callwood, whom we shall call the testator.It was stated at bar that the testator was born in 1862 in Road Town, on the island of Tortola, one of the British Virgin Islands. At the age of 15 he came to the island of St. Thomas, then one of the Danish West Indies, to work for the Hamburg American Line. He soon became its wharf manager in which capacity he continued until his retirement in 1913. He married the plaintiff in 1905 and they had two children, a daughter Waldfriede born in 1906 and a son Clifford, the intervening defendant, born in 1908. Waldfriede married in 1934. She died on April 25, 1939.

It appears that during his residence in St. Thomas the testator purchased a number of parcels of real estate in Charlotte Amalie, one of which is the subject of this litigation. Title to that real estate was, however, taken in the name of his sister Anna Callwood who subsequently married Jacob Peiffer. Upon his retirement in 1913 the testator and his family left St. Thomas and went to live in Germany. Previously, on April 25, 1911 he and his wife, the plaintiff, had executed a joint will in the presence of Wilh. Jacobsen, a Notary Public of St. Thomas, who recorded it at length in his protocol. The testator died at Biebrich on Rhine, Germany, on January 17, 1917. It appears that the notarial joint will which he and his wife had executed in St. Thomas was opened and published by the district court at Wiesbaden, Germany, on April 25, 1917 and filed with its records. The pertinent provisions of the will are set out in a footnote.*fn1

Upon examining the will we see that, relying on a Danish Ordinance of 1845, the testator in paragraph 1 reserved the right, if survivor, to retain the whole joint estate of himself and his wife without dividing it with their children and by paragraph 2 conferred the same right upon his wife, the plaintiff, if she should be the survivor. The will, however, further provided in that paragraph that the right of the plaintiff to retain the joint estate undivided should be exercised under certain restrictions, namely, that she was immediately upon her husband's death "to deposit all cash-money, Bonds, Shares, and Securities belonging to the joint-estate and only to draw the interest of same." It was further stipulated that "In case of unforseen events, which will make it necessary to withdraw the money or to make a change of the securities, this can only be done with the consent of Mr. Jacob Peiffer * * *, or in case of his death with the consent of Mr. Otto Zwanziger * * *, or the person to whom the surviving of these gentlemen may transfer the said authority." It was also provided that the plaintiff, if she survived, should pay certain annuities to Caroline A. Callwood, the testator's mother, and to Josephine W. Branson, his sister, during their lives. Neither of these two annuitants is now living. As has been said, the testator and his wife, the plaintiff, at the time of the death of the former in 1917 were residing in Germany and so far as appears the plaintiff thereupon took possession of their joint personal estate and dealt with it in accordance with the provisions of the will and the applicable law. We are not concerned with the personal estate in the present litigation, however.

What is of concern to us in this case is the disposition of No. 38 Dronningens Gade, Queen's Quarter, one of the parcels of real estate situate in the town of Charlotte Amalie, St. Thomas, which is dealt with by paragraph 3 of the will. That paragraph lists 13 parcels of real estate and recites that although the titles to all of them had been recorded in the name of Anna Peiffer, the testator's sister, "the greater part belongs to us". Specifically, the will recites that No. 38 Dronningens Gade, Queen's Quarter, was owned one-half by Mrs. Peiffer and one-half by C. Callwood, that No. 25 Norregade, King's Quarter, and No. 36 Vestergade, Queen's Quarter, were owned one-third by Mrs. Peiffer and two-thirds by C. Callwood. The remaining ten properties were recited as belonging to C. Callwood alone. Paragraph 3 further provides that if the plaintiff should be the survivor, Anna Peiffer should have the use and benefit of all these parcels of real estate for life upon condition that she pay an annuity to Iza Callwood during their joint lives and upon further condition that she "as soon as possible after my death has the properties recorded in the name of Mrs. Elsa E. Callwood or if she is not taking possession of our joint-estate, as belonging to this, and that she has recorded as a servitude that they may only be sold or mortgaged with the consent of the gentlemen, keeping the power mentioned in Paragraph No. 2."

Pursuant to the directions of the will and in accord with a written agreement signed by the plaintiff, Anna and Jacob Peiffer before a Notary Public at Wiesbaden, Germany, on April 26, 1924, Anna and Jacob Peiffer, by deed dated June 7, 1924, conveyed to the plaintiff the 13 parcels of real estate in Charlotte Amalie mentioned in paragraph 3 of the will. A life estate was reserved by the deed to Anna Peiffer, subject to the payment by her of the annuity to Iza Callwood as specified in the will, and with the proviso that the property could not be sold, mortgaged or otherwise disposed of without the consent of the "trustees" named in the will, Jacob Peiffer and Otto Zwanziger. The life estate thus given to Anna Peiffer by the will and confirmed by the deed was enjoyed by her during the remainder of her life and until her death on July 11, 1947. The annuity to Iza Callwood was settled by the payment of a lump sum to her in July 1923 by the plaintiff as contemplated by paragraph 4 of the will.

The defendant, Osmond Kean, was employed for nearly thirty years by Anna Peiffer as her agent for the collection of the rents and the management of these properties. On February 20, 1942 the plaintiff and the intervening defendant executed a power of attorney appointing Kean as their agent and attorney in fact to manage, lease and sell their real estate in the West Indies. It was stated at bar that in addition to the real estate in St. Thomas to which we have already referred, the testator was the owner of the Arendella and Cane Garden Bay estates on the island of Tortola as well as the whole of Great Thatch Island, all in the British Virgin Islands, which had been owned by his father, Richard Louis Callwood, who died intestate in 1902, and that Kean was employed by the plaintiff and the intervening defendant in managing these properties.

On May 20, 1946 Kean, as attorney in fact for the plaintiff and with her approval sold No. 38 Dronningens Gade for the sum of $45,000. The deed to the purchaser was signed by Kean as attorney in fact for both the plaintiff and the intervening defendant.*fn2 The sale price of $45,000 appears from Kean's account to have been applied by him as as follows:

To the payment of existing mortgages on the property $3,960.21

To commission and expenses of sale 5,174.78

To investment in mortgage loans to Paiewonsky and Beretta 25,000.00

To investment in 8/45ths undivided interest in No. 87

Kronprindsens Gade, Charlotte Amalie 2,075.00

To payments to, or for the account of, the plaintiff 9,052.70

To payments to the intervening defendant ...

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