Corp. of President of Church of Jesus Christ of Latter--Day Saints v. Jolley - 24 Utah 2d 187, 467 P.2d 984 (Sup.Ct. 1970)

Rule:

Where a party is not a bona fide purchaser for value, her defenses in raising the question as to her lack of knowledge of the source of the funds which purchased automobiles, and her averment that a constructive trust can only be impressed upon the wrongdoing fiduciary or confidant, are of no avail to her.

Facts:

Defendant, Vickie C. Jolley, a recipient of her boyfriend's largess, received two brand new cars as gifts from her boyfriend, LaMar Kay. She went with her boyfriend to the dealership to pick them out. The boyfriend had embezzled the funds to purchase the cars from the plaintiff church, the Corporation of the President of the Church of Jesus Christ of Latter-Day Saints, for whom he worked as an accountant. The plaintiff brought an action to impress a constructive trust upon the two new cars. The defendant argued that she lacked knowledge of the funds' source and she contended that a constructive trust could only be impressed against the wrongdoing fiduciary or confidant. The trial court impressed the constructive trust. Defendant challenged the decision.

Issue:

Could the plaintiff impress a constructive trust upon the cars, notwithstanding the fact that the recipient lacked knowledge of the funds’ source?

Answer:

Yes.

Conclusion:

The Court affirmed the trial court’s decision, holding that the defendant’s stated defenses were not available to her where she was not a bona fide purchaser for value. There was some confusion concerning the source of the funds for a remaining payment on one of the cars; however, the court concluded that it was essential that the court or jury have the prerogative of finding not only facts based upon direct evidence, but also those which may be established from the reasonable inferences that could be deduced therefrom.