Terry v. Wilson

Hough, Judge, delivered the opinion of the court. This was an action under the statute in relation to the claim and delivery of personal property. On the 17th day of April, 1871, R. W. Gibson executed and delivered to his wife, Parolee Gibson, his promissory notp for the sum of $3,000, payable one year after date, and to secure the payment thereof, executed on the same day a deed. of trust, in which his wife joined, whereby he conveyed to the plaintiff, Terry, as trustee, one hundred and sixty acres of land, a number — 497 — of horses, mules and other live stock and certain farming implements, with power to sell the same in event of default in the payment of the note, and to apply the proceeds of such sale to the payment thereof. At the time of this conveyance Gibson was indebted to one Jennie for merchandise, and on the 22d day of September, 1871, executed his note for the amount of said indebtedness. Judgment was rendered against Gibson on said note, and on the 19th of March, 1872, execution was issued which was levied upon one of the mules conveyed to Terry by the trust deed aforesaid, and on the 17 th day of June, 1872, said mule was sold under said execution to the defendant, Wilson. Default having been made by Gibson in the payment of the note to his wife at its maturity, and the property conveyed in the trust deed never having been sold, Terry, the trustee, brought the present suit to recover the possession of the mule bought by the defendant Wilson, at the execution sale. The trust deed was duly recorded on the 21st of April, 1871. There was some testimony tending to show that the deed of trust included all the property of R. W. Gibson. Mrs. Parolee Gibson testified that she and her husband, R. W. Gibson, were married in 1869 ; that at the date of the marriage she had $2,100 in money, part of which she had herself earned, and a part she had received from her stepfather ; that she also owned certain personal property, consisting of a wagon, horses, sheep and the property sued for, which added to the $2,100, made the sum of $8,000, for which her husband gave the note, which the trust deed was made to secure. She further stated that she kept the $2,100 in her hands until the note and trust deed were given. . The plaintiff also claimed that the mule was exempt from execution,. but as we do not think that the personal privileges in this regard of the grantor in the trust deed can be asserted by the trustee, this point will not be further noticed. There was a verdict and judgment for the defendant from which the plaintiff has appealed. — 498 — The defendant contends that the note from Gibson to his wife was a nullity, and that the deed of trust made to secure it must fall with the note. The deed from Gibson to Terry cannot be regarded as conveying the property embraced in it for the sole and separate use of Mrs. Gibson. It was an ordinary trust deed with power in the trustee to sell the property conveyed for the payment of the note secured thereby. It would have been equally appropriate in all its parts as security for the payment of a note to a person other than his wife. The property was conveyed in trust to pay a debt, and was held by the trustee as much in trust for the grantor as for the beneficiary. Whether there was a resulting trust to the sole use of the grantor will depend upon the force and effect to be given to the note which it was made to secure. A husband may undoubtedly make a direct gift of chattels to his wife, which will be upheld in equity if the same be delivered to her, and his intention to create a separate property in her in respect thereto be at the time dearly and conclusively manifested. The common law rule, that as to dioses in possession the possession of the wife is the possession of the husband, is based upon the doctrine of the absolute unity in law of husband and wife. But in the contemplation of courts of equity the wife may have a separate existence and separate possessions, and though the possession of the wife is prima facie the possession of the husband, such possession may be shown to be separate and distinct in her. (Bishop’s Law of Married Women, § 731.) While a gift of money by the husband to the wife, to be held by her as her separate property, may therefore be upheld, a bare promise by the husband to pay money to the wife, as by promissory note for instance, occupies a more doubtful attitude, and would seem to indicate, by implication only, any purpose on his part, to create in her a separate estate. The wife may undoubtedly become a creditor of the husband by contract between them after marriage, and her rights as such would be enforceable against him and his representatives. Where, for example, the wife is possessed of a separate estate and permits the same to be used by the husband for the payment of his — 499 — debts, taking his promissory note therefor, she would occupy the same relation to him, and be entitled to like privileges, as other creditors. (Sto. Eq., § 1373.) And her rights under a deed of trust made to secure the payment of such note should, it would seem, be superior to the rights of an execution creditor acquired subsequent to the registry of such deed. So, if the wife have choses in action and the husband should at the time of appropriating them to his own use make positive, precise and clear declarations that he took the same only as her trustee, and should promise to account therefor to her, the wife might claim the fund used as her own, even against his creditors. (Bishop’s Law, Married Women, § 123.) An appropriation so made would not amount to a reduction by the husband of such choses in action to his possession. It is well settled that it is optional with the husband whether he will reduce the wife’s choses in action to his possession, and if he do not his creditors cannot claim to have them applied to the payment of his debts, and in the event 'of his death they will survive to her. We do not of course refer in this statement to post-nuptial choses in action created with money furnished by the husband. But where the wife is possessed of chattels or money at the time of her marriage, in which she has no separate estate, as such chattels and money are choses in possession and not choses in action, if the husband uses the same and executes to her his promissory note therefor, we do not see how she can thereby claim to be his creditor or stand in any other relation to him, as payee of such note, than that of a mere volunteer. The use of the money would certainly constitute no sufficient consideration for the promise, as in speh case he would only be using what was in law already his own, and the note would, under the most favorable view which could be taken of the transaction", amount only to a voluntary settlement upon her. In transactions between husband and wife, as between other persons, a distinction is to be taken between those which have a valuable consideration to support them, and those which have not. (1 Bish. Law Mar. Women, § 720.) — 500 — In the case of Huber vs. Huber’s administrator (10 Ohio, 371) it was held that a promissory note made by the husband to the wife for money in her possession at the time of the marriage, which had been used by him, amounted to a gift to the wife to her separate use. To the same effect is Wood vs. Warden’s administrator (20 Ohio, 518). In the case of Denning vs. Williams (26 Conn. 226) certain shares of bank stock belonging to the wife at the marriage were transferred by the husband into his own name on the books of the bank, used by him as security for a loan, and afterwards re-transferred to his wife, together with other shares purchased by himself. The court, passing by the question whether the stock was property in possession, and confining its observations to the question whether the transfer was to her separate use, said : “We cannot believe that the husband, in order to be irrevocably bound, must use language to that effect, or covenant that he will not resume or sell the thing he has given to his.wife. When a stranger gives to the wife it is true that words of exclusiveness are necessary, for otherwise the unity of the husband and wife would carry to the husband alone a gift of personal property made to the wife. But when the husband himself gives to his wife this cannot be necessary, and we are confident no case can be found which upholds such a doctrine.” In the case of Maraman’s administrator vs. Maraman (4 Metc. 84) a promissory note was given by the husband to the wife for the proceeds of real property, not her separate estate, conveyed by her at his instance, to pay his debts ; and the court held that it was not necessary, in order to give her a right to the money for her separate use, that the notes should be so expressed. The court said: “Maraman must be regarded as having agreed to pay the money to his wife for her separate use; otherwise his note, which he must have designed to have some effect, can have none in law or equityand her claim was enforced against the estate, subject, however, to the rights of creditors, on the ground that her claim was a mere equity, and there was no legal demand to which she could be substituted. But we do not see why her rights in this case should not be as great as where her choses in — 501 — action had been appropriated under a promise to refund, for he might reduce her cJioses in action to his .possession at -his pleasure, whereas he could not compel' the conveyance of her land, nor could it he made but by her consent obtained on privy examination. If the doctrine announced in the foregoing cases be conceded •to be correct, the note of Gibson to bis wife cannot be considered as a nullity, but the rights acquired by her and the trustee (Terry) would be subject certainly to the rights of creditors existing at the time of the execution of the note and trust deed ; for it is plain from the facts stated, that the items of personal property for whieh the note was given were neither the separate estate nor the dioses in •action of Mrs. Gibson, but only her personal property in possession. We are of opinion, therefore, that the defendant obtained a good title to the property in controversy -by his purchase at the execution sale, and the judgment of the circuit court will be affirmed. Judges Naptoa and Sherwood concur; Judge Wagner absent.