Morgan v. Wickliffe

115 Ky. 226 | Ky. Ct. App. | 1903

Lead Opinion

Opinion of court by

JUDGE PAYNTER

Affirming

The appellant, Morgan, executed to aippellee, Wickliffe, a -note for the sum of $2,127.40, and, to secure the payment of it, executed a mortgage upon a tract of land in Daviess county, Ky. The property belonged to Morgan, but his wife joined 'in the execution of the mortgage. This action was instituted to enforce it, to which the wife was- made a party, and was proceeded against as a nonresident. The husband .appeared and made a defense to the action. A warning order was made against the wife, but she never answered. The court rendered judgment decreeing a sale -of the land to satisfy the mortgage debt, but made no reference to the wife’s rights in the land; nor was a bond executed to her as a nonresident, under section 110 .of the Civil Code of Practice. A reversal is sought upon the ground that such bond was not executed.

.The wife was not a necessary party to the action. The effect of the mortgage which she executed was to release her potential right of dower in the land, except the surplus proceeds arising from the sale of the land, if any. Section 2135, Kentucky Statutes, reads as follows: “The wife shall not be endowed of land sold, in good faith, but not -conveyed by the husband before marriage, nor of land sold, in good faith, after marriage, to satisfy ia lien or incumbrance created before marriage, or created by deed in which -she joined, or to satisfy a lien for the purchase-money; but if there is a surplus of the land or proceeds of the land after satisfying the lien she may have dower out of such surplus of the proceeds, unless they were received or disposed of by the husband in his life time.” In this section it is expressly stated that the wife is not -entitled to dower in land which is sold in satisfaction of a lien or incumbrance created before marriage, or created by deed in which she joined, except, if there is a .surplus of the land, or proceeds of the land, after .satisfying the lien, she may have dower out of such surplus of the proceeds, unless -they were received or disposed of by the husband in his lifetime.

In Schweitzer v. Wagner, 94 Ky., 458, 15 R., 229, 22 S. W., 883, tfhe court had under consideration the construction of the .statute above quoted. In that case it appeared that the wife joined in the mortgage. In the proceedings to sell the land .she was not made a party. Afterwards she brought a suit to have dower assigned her out of the land. It was claimed that she was not a party to the proceeding to enforce the lien, and therefore was entitled to recover dower. The court held that the mortgage in which she joined was a deed, within the meaning of the statute. In effect, the court held that she by the mortgage divested herself of .any interest in the land; her interest being in the surplus proceeds which the statute gave her, and only in this if the husband did not dispose of it during his lifetime. In that ease the court said: “It is urged by the appellee that by the term ‘deed,’ in this statute, is meant ‘mortgage,’ or, rather, that the former embraces the latter, and that the appellant, having joined in the mortgage or deed creating the lien, to satisfy which the sale was made, is not endowed of the land. There is much plausibility in this construction. The intention certainly seems to be that if the wife joins in a conveyance creating a lien, and the land so incumbered be sold to satisfy it, she shall not be endowed thereof, but may have compensation out of the surplus, etc. A deed, in 'the ordinary sense of that term, is not What is meant in the statute, as by it no lien is created against the grantors, to satisfy which a .sale of the land can be made. A mortgage of land is a conveyance of it for the purpose of securing the payment of debt. It is .a deed creating a lien, and seems to be the very instrument designated in the statute, in which, if the wife joins, she is divested of dower, «save in the surplus proceeds of -the sale, if one be made, to satisfy the lien so created. Such has been the construction of this statute in cases of sales for purchase money. ... So it would seem, if it be sold in good faith, because there is a lien for debt created by deed or mortgage, in which the wife has joined, and With a view to satisfy it, she should not be entitled to dower, in the absence of any design to deprive her of her inchoate right. The statute makes no distinction between sales made' under an order of court and those made by the owner, and liens for purchase money are placed in the same class with liens created by deed in which the wife' joined. She occupies the same relation to the one class as to the other. In neither case has the husband or wife any beneficial interest in the lands not subordinate to the liens.” There is no distinction between a lien for purchase money and a lien created by mortgage or deed. The wife has a potential right of dower in the land in the one case as in the other. In each case it is subordinate to the lien.

In Melone, etc. v. Armstrong, 79 Ky., 248, it is said: “This statute evidently contemplated that a sale might be made by the husband, and that he might sell the whole, or only so much as would satisfy the lien; but whether sold by the husband, or under the judgment of a court, if the¡ whole be sold bona fide, because there is a lien for the purchase money, and with a view to satisfy it in the manner deemed by the husband to be most beneficial to him, and with no design to deprive the wife of her potential right of dower, she will not be entitled to dower, although less than the whole would have satisfied the lien.”

In Ratcliffe v. Mason, 92 Ky., 190; 13 R., 551; 17 S. W., 438, it was held that, where land of the husband is sold in good faith to satisfy a lien for purchase money, the wife is not entitled to dower in the land, although it may have been sold for more than the amount of the lien, and that this is true whether the sale was made directly by the husband, or under direction of the court, .and it must be regarded as a sale in good faith, whether it is made pursuant to a deed. or assignment, or directly by the husband, as' that which a person is legally bound to do can not be said to have been done in bad faith.

It was held in Johnson v. Cantrill, 92 Ky., 59; 13 R., 497; 17 S. W., 206, that a widow is not entitled to dower in the land of the husband which has been sold to satisfy a lien for the purchase money.

Thése opinions relating to a case where land was sold to satisfy a lien for purchase money are identical in principle with the case where a mortgage lien is enforced because the statute is made to apply where sales are made directly by the husband, or under a judgment of court, to satisfy a lien or incumbrance, whether it is created by deed or mortgage in which she joins, or to satisfy a lien for purchase money. The only difference between the- rights of the wife in land which the husband owns, and incumbers by mortgage in which she joins, and land which the husband has purchased and which is incumbered by lien for purchase money, is that the lien for purchase money is created by the operation of law, as i;t attaches' when the land is conveyed and the purchase money remains unpaid, while in the case of a mortgage the potential right of dower exists, except when the wife has waived it by joining in the mortgage. When either of the two transactions take place, the wife’s rights in the land are exactly the same; the difference being that in the one case she waives her right, and makes it subordinate to the lien, and in the other the law determines it, and makes^ it subordinate to the lien. The fact that the wife is not a party to the suit is immaterial, because at the time of the enforcement of the lien she has no present interest in the land which can be sold to satisfy the lien. In Tisdale v. Risk, 7 Bush, 141, the court expressly held that the widow’s title can not be extended to the land purchased by a party from a court, and conveyed to him by the court without' incumbrance of lien in her favor. The statute was intended to protect purchasers under such circumstances, but the wife loses her dower and compensation therefor in the surplus if it is received or disposed of by the husband in, his lifetime. This is true whether the surplus proceeds are received by the husband as a result of a private or judicial sale of the property to satisfy a lien or incumbrance on it. The plaintiff has no right to the surplus proceeds because his demand has been satisfied when the lien or incumbrance has been discharged by the appropriation of enough of the proceeds of the sale to pay his debt. He is not compelled to look to the application of the surplus proceeds; hence he has no liability for its application. Neither is the purchaser compelled to look to the application of any part of the purchase money.

The plaintiff asserted no cause of action against the wife. He did not seek to appropriate her property for the payment of the debt, but only sought to subject the husband’s property, in which she, by the mortgage, had waived her potential right of dower, and, in effect, had consented that the husband might directly sell it, without her joining with him, to satisfy the debt; and what he could do, and failed to do, the court had a right to do for him. Had th.e plaintiff given the wife a bond, it could not have protected her against the act of the husband in getting the surplus proceeds, if any. It would have been an idle thing to have executed it.

In this case only so much of the land was ordered sold as was necessary to satisfy the judgment, and under which there could be no surplus proceeds; and, of course, no question could arise as to their application.

It is a useless thing to make the wife a party to an action, because her potential right to dower may never ripen into a dower interest, as she may not survive her husband. One desiring to purchase land at a judicial sale can examine the record to see whether the wife has joined in the deed or mortgage, and made her potential right pf dower subordinate to the lien to satisfy which it is being sold. The purchaser must take notice of the condition of the record with reference to her action.

It has been suggested that she should have a right to show whether or not she joined in the mortgage before the land was ordered to be sold. So far as her rights are concerned, that is immaterial. If she has not executed a mortgage, and her potential right has ripened into a dower interest, it will then be time enough to show that she did not join in the mortgage waiving it.

It is suggested that the husband is interested in having the land bring as much as possible, and that it will bring more, if there is a judgment barring her right to dower. As she signed the mortgage, the purchaser is presumed to have examined the record, and to have concluded, under the opinions of this court, that her rights were subordinate to the plaintiff’s lien. If she had filed an answer, and successfully shown that she did not execute the mortgage, it would not have helped the husband, because the land would have brought less at the sale than it did bring.

Doubtless there are cases of other courts which hold the wife is a necessary party to an action to enforce a lien upon the husband’s property. They are not based upon a statute, as are the opinions of this court.

The previous opinion delivered herein is withdrawn. Judgment is affirmed.

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Dissenting Opinion

Judge O’Rear’s

dissenting opinion:

The petition for rehearing relied upon the cases of Tisdale v. Risk, 7 Bush, 141; Melone v. Armstrong, 79 Ky., 248; Ratcliffe v. Mason, 92 Ky., 190, 13 R., 551, 17 S. W., 438; Johnson v. Cantrill, 92 Ky., 59, 13 R., 497, 17 S. W., 206. Those cases were not overlooked on the former consideration of the case. But a reference to them will disclose that every one of them involved a sale of lands to satisfy a purchase-money lien. The statute being construed and applied provided that the wife should not be endowed of land of her husband, sold in good faith to satisfy a purchase-money lien thereon. Section 2135, Ky. St. Nor is she endowed of land sold by him, but not conveyed, before the marriage. No right of hers was or could be affected by the proceedings if either the land had been sold by the husband before the marriage, but not conveyed, nor if it was sold in good faith to satisfy a purchase-money lien. For her right as potential do.wress had never attached to the land. However, we apprehend that even in such state of case it would not be improper to join thei wife as a party defendant, under proper allegations, so> that the complete title might be assured to the purchaser.. But in the matter of a mortgage in which she has joined,, or which purports to be signed by her, the case admits that, she had a right in the premises, but asserts that she has: divested herself of it by an act which, under the statute, when executed by her before certain officiate and under certain formalities, extinguishes her right as against the plaintiff’s debt. That is true, but it is no truer than that the husband is by a similar act alone divested of his right in the land as against that debt. Why should not she have her day in court, as well as he, before their rights shall be foreclosed? Perchance, she did not sign the mortgage, or that she did so under duress, or by reason of the fraudi or deceit of the mortgagee, or she may have been non co.mpos at the time, or an infant, or she may have executed it for a certain consideration from the mortgagee to her, which had failed. Can it be said that she should be precluded, by a judgment in an action to which she is not a party, from making any such defense? There is an obvious distinction between one’s never having had a title, and having conveyed it as pledge or security for a debt. In the first instance the person may well be ignored. In the second there is always, under our practice, such an interest as permits the person whose property is to be taken in satisfaction of the debt to be heard and to redeem. The case of Helm v. Board (decided on the same day as was this case), 24 R., 1037; 70 S. W., 679, was likewise a case where a purchase-money lien had been enforced. The statute gave the wife, in that event, dower only in the surplus of land or its proceeds at the sale to enforce the lien. Helm v. Board merely followed Tisdale v. Risk, supra, and the other cases cited, and was cited in the opinion in this case as being in harmony with its doctrine.

For these reasons, and those stated in the original opinion, I can not concur in the opinion now filed by the majority of the court in this case. '

Chief Justice Burnam and Judge Nunn concur in this dissent.

Petition by appellant for rehearing overruled.

Whole court sitting.