Craft & Co. v. Stoutz

COLEMAN, J.' Craft & Co., complainants, as creditors of the estate of F. Arnold Stoutz, filed the present bill to subject to the payment of their claim certain property, the [248] legal title to wbicli is in tbe name of bis wife, tbe respondent. It is unnecessary to consider tbe validity of tbe deed of 1883, by wbicb Arnold Stoutz, tbe husband, conveyed tbe homestead to bis wife. If null and void for want of consideration, or defective execution of tbe conveyance, or for any other cause, tbe mortgage on this property executed by Stoutz and wife to Phoebe A. Tuthill, on tbe 1st day of April, 1884, is not assailed. At tbe time of tbe execution of this mortgage, complainants bad no lien on, or claim to this property, and the grantors bad a perfect right to mortgage the same, if the}'- saw proper. This mortgage was foreclosed on tbe 23d day of March, 1886, and at tbe sale tbe property was purchased by one Hudson, either for himself or the mortgagee. If this property, conveyed by tbe mortgage to Tuthill, was tbe property of Arnold Stoutz, as charged in tbe bill, complainants, as judgment-creditors of Arnold Stoutz, were authorized to redeem this property from tbe purchaser. Their judgment against Arnold Stoutz was recovered on tbe 16th day of December, 1886, and they have permitted more than two years to elapse, tbe time allowed by statute for redemption. Tbe present bill is not one to redeem tbe property. It is averred that, on tbe 28th day of June, 1888, Phoebe Tuthill by deed conveyed tbe property to Julia Stoutz, for an expressed consideration of eleven hundred dollars; that on tbe 28th day of June, 1888, twelve hundred dollars was borrowed by Arnold Stoutz from one Gelbke, tbe payment of wbicb was secured by a mortgage executed by Julia Stoutz (tbe wife) and her husband on this property to said Gelbke, and that tbe money thus borrowed was tbe money paid to Mrs. Tuthill, tbe consideration for tbe conveyance to Mrs. Julia Stoutz of June 28th, 1888. Tbe bill then shows that tbe husband, Arnold Stoutz, died, and out of tbe proceeds of a policy of insurance taken out by him in bis life-time for tbe benefit of bis wife, Julia Stoutz, tbe mortgage to Gelbke was paid by her; and that tbe wife, in addition to tbe money paid to satisfy this mortgage, expended about two thousand dollars in improving tbe premises. Tbe bill charges that complainant’s judgment was founded upon notes made by Arnold Stoutz, in which be waived bis right to claim exemption of personal property, and that these notes antedated tbe payment of the annual premiums, and that tbe premiums paid upon tbe policy were voluntary, and null and void for this reason as against him. Tbe equity of complainant’s bill, and bis right to relief in this aspect of [249] tbe case, depend upon tbe right of tbe wife to tbe money collected from tbe policy. Section 2356 of tbe Code provies, that tbe wife may insure tbe life of tbe husband, for tbe benefit of herself, or for tbe benefit of herself and child or children of tbe marriage. It also provides that tbe husband or father may insure bis life for the benefit of tbe wife and child or minor children, and such insurance is exempt from liability for bis debts or engagements, if tbe annual premiums do not exceed five hundred dollars. In this case, as appears from tbe bill, tbe annual premiums were not so much as five hundred dollars. A note waiving exemption as to personal property is a mere debt or engagement. It in no sense creates a lien on property or money. Tbe effect of tbe statute which permits the husband to insure bis life for tbe benefit of bis wife is to enable tbe husband to expend so much money in tbe manner prescribed, for tbe benefit of bis wife, which, without tbe statute, would not be exempt from liability for the debts of tbe husband. Tbe creditors of Arnold Stoutz, tbe bus-band, have no claim upon tbe insurance money, tbe proceeds of tbe policy taken out for tbe benefit of the wife. This money belongs to her in her absolute right, and she bad tbe power to expend it as she saw proper. « Tbe demurrer to tbe bill raised these questions, and was properly sustained. Affirmed.