Houck v. Somers

Faircloth, C. J.: If A purchases property from B, taking the title in himself, and the consideration is furnished by C, by operation of law A becomes a trustee for the benefit of C, and the statute at once executes the trust, and 0 becomes in equity the absolute owner. Such a trust need not be in writing, and it may be shown by parol proof. The authorities in our own reports are numerous. Application : If the wife, C. J. Ayers, furnished the consideration in money or property, for the note and mortgage executed to her husband, IT. L. Ayers, then he immediately became her trustee, and it can make no difference whether he assigned the note to her before or after its maturity, as it was her property from the day of its execution and became her separate estate. The defense, that there was a balance due the defendant on partnership account between him and the husband, cannot be allowed, as that would contravene the Constitution, Article X., Sec. 6, which declares that the separate estate of the wife “ shall not be liable for any debts, obligations or engagements of her husband.” The plaintiff alleged that the consideration for the note and mortgage [612] was the money of the wife, and that was denied in the answer. That is a material fact in the case and can be ascertained by a distinct issue submitted, or it may be made available by appropriate instructions to the jury upon the issues already submitted. His Honor fell into the error of treating the case as one exclusively between the husband and the defendant, regardless of the wife’s equities, in which event, as far as now appears, he would have held correctly. The plaintiff’s prayers for instructions were in substance proper to be heard by the jury. Adams’ Equity, 33; Lyon v. Akin, 78 N. C., 258; Clement v. Clement, 1 Jones’ Eq., 184. Judgment Reversed. Furohes, J., did not sit on the hearing of this case.