Christensen v. Beebe

ERICK, J. The plaintiff sues to recover the value of certain property alleged to have been converted by the defendant. The questions to be determined arise out of the facts stated in the complaint wherein it is, in substance, alleged that plaintiff, at the time mentioned in the complaint, was, and now is, a resident of Utah, the head of a family consisting of his wife and *407 three children, all of whom are dependent on him for support; that on June 26, 1905, and from thenceforth the plaintiff was, and now is, the owner of and entitled1 to the possession of ten-thousand brick of the value of $65; that on the said 26th day of June, at Castle Dale, Emery county, Utah, by virtue of an execution duly issued by the clerk of the district court of said county upon a judgment duly filed therein, the defendant as sheriff of said county, wrongfully and unlawfully levied upon and seized said ten thousand brick as the property of the plaintiff; that the judgment upon which said execution was issued was not recovered, either in whole or in part, for the purchase price of-said brick; that said brick at the time of levy and seizure were, and now are, exempt from execution sale under process under the laws of this state; that said brick were the proceeds of a sale of plaintiff’s real estate constituting his homestead, not exceeding in value the sum of $150, which plaintiff, on or about the month of May, 1903, sold and thereafter duly conveyed to one Peterson for a consideration of $100, which consideration Peterson agreed to pay to plaintiff in the summer or fall of 1904 by the delivery of bricks or adobes to him; that plaintiff always has claimed, and now claims, said brick as exempt, the same being part of the proceeds of the sale of said homestead, and that said homestead was sold and said brick were agreed to be delivered and received and used for the purpose of constructing a dwelling house as a home upon plaintiff’s real estate at Oastle Dale, Emery county, Utah, now owned and occupied as a homestead by the plaintiff, the value of which does not exceed the value of $800,- and which is all the real estate owned by the plaintiff; that no part of said brick had ever been delivered to plaintiff, and he had never received the same, or any part thereof, but that the same were levied upon by the defendant as the property of plaintiff before delivery to or the receipt thereof by him: that ever since the levy 'and seizure of said bride the defendant has wrongfully detained the same from the plaintiff, and on the 6th day of July, 1905, at Castle Dale, Emery county,Utah, the said defendant wrongfully converted said brick to *408 bis own use, to tbe damage of tbe plaintiff in tbe sum of $65 ; tbat on tbe 25th day of July, 1905, and before tbe commencement of tbis action, tbe 'plaintiff demanded said brick from tbe defendant, and on said day notified bim tbat be claimed tbe same as exempt from levy upon execution. Upon substantially tbe foregoing allegations plaintiff prayed judgment against .said defendant for tbe value of said brick. Tbe defendant appeared and demurred to tbe complaint upon tbe ground tbat it failed to state facts sufficient to constitute a cause of action. Tbe demurrer was sustained; and, tbe plaintiff electing to stand on bis complaint, tbe court duly entered judgment against bim, dismissing tbe action, from which plaintiff appeals. Tbe only error assigned is tbe action of tbe court in sustaining tbe demurrer. It will be observed tbat tbe complaint is not as clear as it might be with regard to tbe allegations constituting tbe alleged conversion of tbe brick. There is no direct allegation tbat defendant sold tbe brick under tbe execution, under which the levy was made, but it is directly alleged tbat defendant wrongfully converted tbe same to bis own use. If tbis were so, tbe levy under tbe execution, however lawful, would afford tbe defendant no protection, regardless of whether tbe brick were subject to execution or not. With regard to tbis, however, and in respect to other minor defects of tbe complaint, both parties, with a most commendable spirit of fairness, have stripped tbe matter from technicalities, and have asked tbat tbe real and only question involved, to wit, tbe exempt character of tbe brick, be considered and determined by us, and have expressed a desire tbat for tbat purpose tbe complaint should be considered as sufficient. In deference to those wishes we shall so¡ consider it. Tbe question therefore is, were tbe ten thousand brick exempt as a part of tbe proceeds of tbe sale of plaintiff’s homestead, within tbe purview of section 1158, Rev. St. 1898, which, so far as material here, provides, “and tbe proceeds of the sale thereof (homestead), to the amount of tbe exemption existing at tbe time of sale, shall be exempt from execution or other process for one year after tbe receipt *409 thereof by the person entitled to- the exemption ?” - We remark, first, that there can be no reasonable doubt with regard to the ten thousand brick as constituting a part of the proceeds of the sale of plaintiff’s real estate, which it is alleged, and admitted by the demurrer, constituted his homestead, and thus at the time of the sale thereof was exempt, together with the proceeds thereof to the extent of at least $1,500. The exempt character of the proceeds, however, continued so only for the period of one year after the “receipt thereof” by the plaintiff, and thus the question arises, what constitutes the receipt of the proceeds of the sale, within the purview of section 1158 above quoted ? Defendant’s counsel contends that the proceeds as applicable to voluntary sales of homestead consists in whatever the seller agrees to accept and receive as the consideration or payment for the homestead, be the same money, property, or anything else which represents property or value. This contention seems not only just upon principle, but, as might well be expected, is also sustained by the authorities. (Bailey v. Steve, 35 N. W. 735, 70 Wis. 316; Phelps v. Harris, 101 U. S. 380, 25 L. Ed. 855; Hoppe v. Goldberg, 53 N. W. 17, 82 Wis. 660.) Of course, the meaning of the term “proceeds” may be extended or restricted in accordance with the particular subject-matter out of which they arise, or with regard to the peculiar disposition or application to be made of them. With regard to a forced sale upon execution, the proceeds are, of course, always understood to be in the form of money, or some other medium of exchange, the equivalent of money; or, if an agent were empowered to sell goods, or collect accounts, and account for the proceeds derived therefrom, in the absence of an express agreement to the contrary, he would have to account in money, or in some medium of exchange which passed as such. When we have reference, however, to a voluntary 3ale or disposition of a homestead, within the provisions of section 1158, “proceeds,” of necessity, and for the benefit of the owner, must be considered as comprising any tangible thing of value he is willing to accept. The exemption of a homestead, or the proceeds thereof, is grounded on public *410 policy, and should not be restricted to money only. . The different meanings applied to proceeds are shown in volume .6 of Words and Phrases, under the title “Proceeds,” commencing on page 5639, to which we refer for further illustration. Plaintiff’s counsel strenuously insist that the ten thousand brick and nothing else constituted the proceeds of the sale or exchange of plaintiff’s homestead, and in view that they had not been segregated, that is, set part as his brick, and had not been delivered to nor received by him within a, year prior to the levy, that therefore they did not lose their exempt character, and were not subject to sale on execution. Upon the other hand, defendant’s counsel contends with eqtlal' fervor that the proceeds of sale of plaintiff’s homestead consisted of Peterson’s promise and obligation to deliver the brick t:> plaintiff, and that plaintiff accepted this promise, and therefore received it in Hay, 1903, when the sale of the home'stead took place, and that the promise and obligation, that i°, the debt owing by Peterson to plaintiff, was exempt for a period of one year and no longer. This brings us to the real quéstion in this case, to wit, what is meant by the phrase in section 1158, in referring to the proceeds, that they shall be exempt “for one year after the receipt thereof ?” The section should be construed, if possible so as to carry into effect thé obvious purpose and intention of the Legislature in adopting it Statutes of this kind are grounded upon sound public policy, and thus fall within the category of statutes usually favored by the courts, and hence are generally accorded what is termed a liberal construction, with the view of fully effecting the purpose aimed at by the Legislature in adopting them. While all this is true, courts cannot rightfully extend the period of time within which a certain'class of persons may claim designated property as exempt from forced application to the payment of their debts. This power belongs to the Legislature, not to■ the courts. But this court should not by strict construction frustrate that which the Legislature sought to' accomplish; nor should it do this by permitting the case actually presented, to he determined upon' principles other than *411 those applicable to the facts, simply because it might be easier to do so, or because from an apparent analogy the case seems to fall within a class of decisions which are, in fact, based upon statutes greatly differing from our own. By adopting section 1158 the Legislature evidently intended that the owner of a homestead should enjoy the fullest opportunity to use and to dispose of it and to have one full year in which to acquire another with the proceeds derived from the first, and for that purpose to be in actual possession of such proceeds, so that he may apply them to the purpose intended. If the Legisláture did not intend just this, it would have been easy for it to have limited the time within which another homestead was to be acquired to one year from the sale of the first. The mere fact that the terms “proceeds” and the “receipt thereof” are used is conclusive that it was not intended to limit either the medium that could be accepted, or the time in which it must be received; but the time for which the “proceeds” are exempt only was limited to one year “after the receipt thereof.” The owner may thus take sheep, cattle, horses, or any other species of property ir exchange for his homestead, and whatever he receives retains its exempt character for the period of one year after he has received it. It is contended, however, that if plaintiff had received sheep, cattle, horses, or a promissory note, or any other tangible property for his homestead, and had not converted what he received into another homestead within one year thereafter, the property received would, after that time, have been subject to levy and sale on execution. This, no doubt, is true, but does the mere promise of Peterson to deliver ten thousand brick not then in existence, and at no time, not even constructively delivered to plaintiff, constitute the receipt of the proceeds for the homestead, as contemplated in section 1158 ? It is urged that the promise and obligation of Peterson to deliver the brick constituted the thing of value, that it could have been reached by the process of garnishment, that the plaintiff could have made the promise available by giving an order on Peterson, or by the assignment of the claim. *412 That plaintiff could' have given the order on Peterson for the claim, if he had found some one willing to take it, and that it was a subject of assignment, cannot be doubted. Whether it was subject to successful garnishment, without the consent of plaintiff, is, however, another question. Suppose plaintiff had sold his homestead for cash, or had exchanged it for other property upon an oral promise that the money would be paid, or the property taken in exchange delivered within ten, thirty, or any other’ number of days; would the time limit of one year begin to run from the date of the sale or exchange, when the promise to pay or deliver was made, or from the time plaintiff received the cash or other property as the consideration for his homestead? If it was intended to limit it from the former, why did not the Legislature fix the time from the sale or exchange rather than from the date of the receipt of either cash or other property agreed to be received ? Is it not manifest that the Legislature intended that the owner of a homestead who parts with it should be in actual possession of the means with which to acquire another for the full period of one year after its receipt, and that within that time that which is received for the homestead shall be just as immune against forced seizure or sale under any process as the homestead would be ? Why fix the limit of time one year after the receipt of the proceeds, if it was intended to give only one year from the sale or exchange of the homestead? For argument’s sake it may be conceded that if plaintiff had taken a promissory note, secured or unsecured, the note and security might constitute the proceeds, but in such a concession is embodied the fact that the note and security would be recognized as property as easily convertible into, money or as readily exchangeable for other property as would sheep, cattle, horses, or other personalty. Moreover, it might then be argued that the owner had actually received something tangible. Does a mere oral promise take the place of the proceeds, and the receipt thereof, as mentioned in section 1158 ? We think not. If such had been the intention of the Legislature, the statute would have been worded differently, as we have already *413 pointed out. Quite true, if a person exchanges his homestead for nonexempt property, which he cannot convert into a homestead within one year, such property loses its exempt character after that time, and is subject to forced sale. The Legislature, however, it seems to us, clearly indicated that the property agreed to be taken in exchange' for the homestead, or in case the property itself is not received, then, at least, that which represents it is a substitute therefor, must be received. In other words, it was intended that the seller should receive something tangible, and not merely an intangible promise or obligation from the purchaser. If, for instance, the owner of a homestead should sell it to his neighbor for $1,000, and the neighbor took possession under a conveyance, but did not expressly promise to pay the amount, and no time for payment being fixed, the law would supply both the promise to pay and a reasonable time within which the payment must be made. In such a ease would the implied promise constituid the proceeds, and if not why should any express promise to pay do so? Of course, it might be contended that a promissory note, even if secured, is only the evidence of the promise. But this may be so with regard to bank notes, or some other such evidences that pass as a medium of exchange. They all' are matters of substance, however capable of manual delivery and receipt. But the question of whether the receipt of a promissory note would or would not be deemed a receint of the proceeds under section 1158 is not before us now, and we do not decide that question. We have alluded to it merely to make clearer, if possible, our conclusions. We think, therefore, that the proceeds mentioned in section 1158 has reference to some tangible thing which is the subject of manual delivery and receipt. Further, that “the receipt thereof” likewise means more than a mere right to have or acquire possession of such proceeds. It evidently was not intended that the person who ■has disposed of his homestead should lose the benefit of the exemption by being compelled to go into court to obtain actual possession of the proceeds. If this were so, the year given him to acquire another homestead might have gone by. *414 ;and thus be would be deprived of the means to acquire another homestead. To hold that a mere right to the proceed", which .another 'may dispute or withhold, constitutes “the receipt thereof,” would simply present another case of keeping the word of promise to the ear' while breaking it to the •hope. It follows, therefore, that the district court erred in sustaining the demurrer. The judgment is reversed, the cause remanded, with directions to the district court to overrule the demurrer, grapd the defendant leave to answer, if he desires to do so, and to proceed with the case in accordance with the views herein -expressed; appellant to recover cost's. IfcOARTY, C. J., and STRAUP, J., concur.