I was talking with my daughter on the phone, when we heard some clicking and movement on the phone that we don't hear usually, I went into Hubby's room to find him trying to hurry and get the phone back on the cradle...don't know if this has happened before, he made excuses that he got all distorted, so it was what it was...is this another behavior of dementia?
I really wouldn't worry about it. Your husband's wanting to listen in on your conversation is one possibility. There are dozens of others. As your husband seemed muddled about it, my guess would be - did you ring her or did she ring you? - that he heard the phone ring but didn't make the connection between that and picking up until after a considerable delay, then found the conversation was going on, then was embarrassed and panicked about it.
Sinister paranoia about who you're talking to would be quite a long way down on the list, though.
I now my mother,who does not have dementia, would be thrilled to pick up a phone and hear a call on another extension. She would gleefully listen in.
Is your hubby by nature a gossipy person? Or sneaky? Does he have reason to believe, rightly or wrongly, that you and your DD are conspiring to place him in a home or "force" him to accept help?