146 Ky. 784 | Ky. Ct. App. | 1912
Reversing.
L. O. Stephenson, the husband of appellee, who was engaged in the undertaker’s business in Mayfield, Ky., executed a mortgage in June, 1905, to his wife, the ap-pellee, upon his stock of goods, to secure the payment of a debt of $3,000.00. The mortgage was properly recorded in G-raves County. Stephenson continued his business in Mayfield from that .time until the latter part of the year, at which time he moved his stock of goods and family to Paducah, Ky., and arranged to continue his business there. In a few days after he arrived in Paducah, he, appellant, and D. L. Adams began negotiations to form a partnership in the undertaker’s business. To effectuate the trade, they invoiced the stock of Stephenson and found its value to be about $2,100. Appellant, Pool, also owned a stock of undertaking goods which was invoiced at $11,000.00. In order to form the partnership, Adams bought- one-third of each of the stocks, Stephenson bought one-third of Pool’s stock, and Pool bought one-third of Stephenson’s stock, and in this way each became the owner of a third interest in the business. Pool paid for his interest with the stock of goods he had on hand and Stephenson put his in at $2,100.00, its invoice value, which left him owing appellant about $2,700.00. Stephenson paid $900.00 of this amount in cash and executed his three notes to appellant for $616.00 each and gave him a mortgage on his interest in the stock of goods belonging to the firm, to secure their payment. Appellee, the wife of L. O. Stephenson, signed these notes and, according to the notary’s certificate, acknowledged the mortgage with her husband, but it does not appear that she signed the mortgage, that is, her signature is not attached to the copy of the record. After this, L. O. Stephenson mortgaged his interest in the stock of goods to his sister, Jennie P. Stephenson, to secure her in the sum of $2,000; and also gave H. L. Anderson, an attorney, a mortgage to secure the payment to him of $2,000.00. It is clearly shown by the testimony that when the partnership was formed, L. O. Stephenson represented to the other members that his stock of goods was free from any encumbrances, and, while the mortgage in favor of appellee was of record in Graves County and was, under the law, constructive notice, it does not appear that either Pool or Adams had actual notice of it. It appears that the
“While as a general thing the courts are loathe to hold that a married woman may divest, herself of her property in any way other than that prescribed by statute, yet we have repeatedly held that a married woman may by her acts and declarations estop herself from asserting dower or other claims, when to permit her to do so would operate as a fraud.”
Appellee did not testify in this action, but introduced her husband, who was also a witness for Jennie P. Stephenson in her suit, and the testimony he gave in the suits is in some respects contradictory. It satisfactorily ap
The facts in the case of Chirchill v. Hohn, 20 Ky., L. R., 200, were, in short, as follows: A wife, with the knowledge of her husband, included property belonging to him in a mortgage given by her to secure her debt. The husband made no objection except to his wife, but allowed her to obtain goods on the faith of the mortgage, assisting her in selling them, and did not inform the mortgagee that he claimed the property until two years after the execution of the mortgage. The court in that case said:
“He was silent when it was his duty to speak. This was equivalent to concealment (7 A. & E. Ency. of Law, 12; Bispham’s Equity, Section 284). He permitted his wife to obtain the stock of goods upon the faith of this mortgage; and assisted her in the conduct of her business in selling the goods so procured, thereby preventing appellees, from taking such steps as they might have'*789 taken to secnre their debt. Equity and-good conscience required that he should make disclosure of his claim under the circumstances of this case. Having knowingly permitted her to obtain the goods on the strength of her supposed ownership of this property, he can not now be heard to assert a claim to its ownership. (Wilson v. Scott, 11 Ky. L. R., 70, and 13 Ky. L. R., 926). ‘When they should have spoken they are silent, and when they should be silent they speak. But the equitable and well established rule in such cases is, if a man is silent when he ought to speak equity will debar him from speaking when conscience requires him to be silent.’ ”
Appellee’s conduct was such as to lead appellant to believe that when he bought an interest in her husband’s goods and when he bought the whole of them, that she had no claim upon them. If she had spoken upon either of these occasions, appellant would not have made the trades. Appellant was very much damaged by appellee’s silence if she is now permitted to collect her judgment, and the same is true with reference to the enforcement of her sister-in-law’s mortgage. In the case of Grace v. Mercer, etc., 49 Ky., 157, it is-, in substance decided that a mortgagee who consents to a sale of mortgaged property, or who stands by and sees it levied upon without asserting his claim will be precluded from asserting his title against a purchaser thereof. Appellee stood by in silence and suffered appellant to pay a full •value for a third of her husband’s stock of goods and also allowed him to purchase the whole of the stock and pay a fair value therefor without making her right known, and she also stood by and suffered her sister-in-law to foreclose her subsequent mortgage lien upon the property. The effect of -this was to allow appellant to pay a full value for the property the first time and to pay her sister-in-law its value the second time, and she is now seeking to foreclose a mortgage lien for $2,100.00 against the same property. She. has by her silence caused appellant great loss, and in equity and good corn-science he should not be made to pay appellee a third time for the property. •
For these reasons the judgment is reversed and the case remanded with directions to dismiss appellee’s action.