Hines v. Duncan

79 Ala. 112 | Ala. | 1885

CLOPTON, J.

Statutes conferring on a debtor the right to exemption of property from sale for the payment of debts have been generally regarded as founded in a humane and enlightened policy, having respect to the common welfare, as well as to the benefit of the individual debtor. Their obvious purpose is to secure to each family a home and means of livelihood, irrespective of financial misfortune, and beyond the reach of creditors ; security of the State from the burden of pauperism, and of the individual citizen from destitution. Such statutes are entitled to a liberal construction — a construction in conformity with the benevolent spirit which moved their enactment. Whilst the language of the statute is, “shall be exempted from levy and sale under execution, or other process for the collection of debts” a formal, technical process is not requisite. The exemption is, in spirit and substantially, from the payment of debts ; and the property is exempt from sale by either process at law or in equity, the subject of which is its appropriation to the payment of debts. The homestead of a married woman, being her equitable separate estate, is exempt from condemnation, by decree in equity, to pay her debts, if the claim is interposed in proper time and mode.—Weiner v. Sterling, 61 Ala. 98. Notwithstanding such statutes are entitled to a liberal construction, it should not be so liberal as to depart from the plain and obvious meaning of the words used, or to dispense with the necessity of parties bringing themselves within their provisions, without being supplemented or extended by judicial construction.

By statute, any lot in a city, town or village, not exceeding two thousand dollars in value, with the dwelling and appurtenances thereon, owned and occupied by any resident of this State, oi', if the same can not be allotted, then two thousand dollars of the value thereof, is exempt from the payment of debts contracted after April 23d, 1873. If the claim of the exemption of the homestead is not asserted before a sale thereof, it is considered as waived; but, by our uniform decisions, it may be successfully interposed at any time before a sale, or an order of sale.—Simpson v. Simpson, 30 Ala. 225; Sherry v. Brown, 66 Ala. 51. If there existed the right to a homestead exemption as against the demand of appellant, it was claimed in'due time.

The bill is brought by appellant to subject a lot of land, situate in the port of Mobile, which is the equitable separate estate of Mrs. Duncan, to the payment of a note made by her, February 27th, 1883, to appellant’s intestate. At the time of the filing of the original bill, and of the service of process, neither Mrs. Duncan nor her husband was in the actual occupancy of the lot, and had not been for twelve months previously ; but, some days after the service of process, they moved into the dwelling-house thereon, occupied, selected, and claimed the land as a homestead, and as exempt from the payment of the note. The right to a homestead exemption is dependent and determinant on the state of facts as they existed at the time the lien of the process attached; and if the right does not exist at this time, it can not be created by any subsequent act of the debtor. To be available, there must be a present right of exemption, when the creditor acquires a lien ; otherwise it is subordinate thereto—Scaife v. Argall, 74 Ala. 473; Murphy v. Hunt, Miller & Co., 75 Ala. 438. The land, unless impressed with the distinctive quality and character of a homestead, is not exempt. Owned and occupied, or, what is the equivalent of occupancy in the meaning of the statute, a present and actual purpose to use and occupy, are essential conditions. When there lias been actual occupancy as a dwelling-place, so as to secure the right of exemption, the statute provides : “ A temporary quitting, or leasing the same, for a period of not more than twelve months at any one time, shall not be deemed to be an abandonment of it as a homestead.” A prior use and enjoyment as a home is requisite to the statutory privilege of temporarily quitting or leasing; and if the owner does not actually occupy the premises, until a lapse of more than twelve months of continuous time, the right of exemption is lost. To sustain a claim of homestead exemption, there must be averment and proof of occupancy.—Lyne v. Wann, 72 Ala. 43; Waugh v. Montgomery, 67 Ala. 573; Blum v. Carter, 63 Ala. 235; Code, §§ 2820, 2843.

There is neither averment nor proof of occupancy before or at the time of the service of process. The availability of the claim of exemption must, therefore, depend on the determination of the question, whether a creditor, by filing a bill to condemn the equitable separate estate of a married woman to the satisfaction of her contracts, and service of process thereon, acquires a lien on the property specifically mentioned, effectual to prevent the accrual of a right of exemption by subsequent occupancy before a decree of condemnation and sale.

It may be regarded as settled in this State, whatever may be the rule in other States, that a bill in equity, with service of process, by a creditor to set aside a fraudulent deed, and have the land of his debtor sold, gives the complainant a lien on the land, which will not be defeated by a bona fide sale by the defendant, or under an execution on the judgment of another creditor, which did not have a prior lien. It was so held in Dargan v. Waring, 11 Ala. 988; and there has been-no subsequent departure from the rule. On the contrary, it has been re-affirmed.—Evans v. Welch, 63 Ala. 250. It has been held, that a fraudulent conveyance of the homestead will not deprive the debtor of the right of exemption, though set aside at the instance of creditors; for the reason, that as the creditor had no right to condemn the homestead to the payment of his debt, he is not injured, and has no cause to complain. In such case, the right of homestead exemption had-existed before the filing of the bill, and the debtor had the right to sell and convey without abandoning it. If such be the effect of a suit in equity to set aside a fraudulent conveyance, more cogent reasons exist in favor of the acquisition of a lien by a creditor, who files a bill to subject the equitable separate of a married woman.

At law, the contracts of a married woman are void. She is without capacity to contract a debt, binding on her personally. Having a separate estate, with the power of disposition, which is the creature of equity, her engagements attach a liability to her estate, and not to her personally; and “ as her creditors have not the means at law of compelling payment of those debts, a conrt of equity takes upon itself to give effect to them, not as personal liabilities, but by laying hold of the separate property as the only means by which they can be satisfied.” The remedy rests on the jurisdiction of the court to reach and subject assets purely equitable, — “ a special equitable remedy arising out of a special equitable right.” In a bill brought for such purpose, the particular property sought to be subjected must be specifically described. The remedy is also specific, as the court deals only with the property thus mentioned, and its liability. To this extent the proceeding is in rem, though in form, and other respects, it is a proceeding in personam. In Kelly v. Turner, 74 Ala. 513, speaking of the operation of the decree on a bill by a creditor resorting to a court of equity to subject the equitable separate estate of a married woman, and the consequent necessity of specifically describing the property, on which the decree is to operate, it is said : “ In this respect, the suit has some of the characteristics of a proceeding in rem, though, in form and essential elements, it is a suit inter partes. A Us pendens is created by the institution of the suit, operative against all persons coming in subsequently, by purchase or otherwise. It creates a specific lien, if successfully prosecuted to final decree; the decree taking effect, by relation, from the day of the service of summons to answer.” Lien, in its enlarged signification, denotes the various charges of debts upon land or personalty, whether created by contract or by statute, or recognized in. equhy. “In courts of equity, the term lien is used to denote a charge or incumbrance on a thing, when there is neither jus in re, nor jus ad rem, nor possession of the thing.”—Donald v. Hewitt, 33 Ala. 534. We do not mean to assert, that the mere contract of a married woman creates a lien or distinct charge upon her separate property. But it may be asserted as a general proposition, settled by our former decisions, that a bill in equity, brought to subject her separate property to the satisfaction of her contracts, followed by service of process, creates a lien upon the specific property sought to be subjected. Such bill, and service of process thereon, are .in the nature of an equitable levy, and give the court control of the property, which it will not permit to be withdrawn by any subsequent act or title, so as to render the suit ineffectual. In' the absence of such bill, she may dispose of her property, and a purchaser would acquire title, though he had notice of her debts; but, after such suit is instituted,she is not authorized to make a disposition of it by sale or otherwise, or to materially change its status. The lien thereby acquired may be defeated or lost by a failure to prosecute the suit to a final decree of condemnation and sale; but it becomes specific, when the suit is prosecuted to a final decree.—Miller v. Sherry, 2 Wall. 237.

It may be said, that the lien, being inchoate, will not prevail over a right of homestead exemption acquired by subsequent occupancy, and before the lien is consummated and made specific by a final decree in the suit. The lien acquired by the levy of a writ of attachment is only inchoate, dependent upon the rendition of judgment. If no judgment is rendered, the lien is lost; but, if judgment is obtained, it overrides and defeats any conveyance of the property, subsequent to the levy, and prior to the judgment.—Reed v. Perkins, 14 Ala. 231. If the right of a homestead exemption does not exist at the time of the levy of the attachment, its lien can not be defeated by an occupancy subsequent to its levy.—Kelly v. Dill, 23 Minn. 435; Bullem v. Hiatt, 12 Kan. 98. The land in controversy, being charged with the payment of the note of Mrs. Duncan, when the appellant filed the bill and had process served, he acquired a specific right to have it sold for this purpose — to have such charge made effectual. When a final decree is made, it relates to, and takes effect from the date of the service of process. By the final decree, the lien is made specific from this date, and overrides and defeats all intervening rights and titles. By no subsequent act of the debtor can the lien be defeated. Permitting the subsequent occupancy of the land as a homestead to prevail over such lien, will consti.tute the statute an instrument of fraud, instead of a shield of protection. In this respect, the lien thus acquired does not differ from a lien secured by the levy of an execution, or of an attachment. It certainly was not the intention of the statutes to confer on the debtor power, by his own act, to deprive a creditor of rights previously acquired. Mrs. Duncan is hot entitled to homestead exemption, superior to the previously acquired lien of complainant. She does not bring herself within the provisions of the statutes as heretofore construed.

Ruversed and remanded.