Creech v. Capitol Mack, Inc.

• Citation: 287 So.2d 497
• Decision Date: 29 October 1973
• Docket Number: No. 53021,53021
• Parties: Neva Felker CREECH v. CAPITOL MACK, INC., et al.
• Court: Supreme Court of Louisiana

Page 497

287 So.2d 497

Neva Felker CREECH v. CAPITOL MACK, INC., et al.

No. 53021.

Supreme Court of Louisiana.

Oct. 29, 1973.

Rehearing Denied Jan. 24, 1974.

Herschel C. Adcock, Womack & Adcock, Baton Rouge, for plaintiff-applicant.

John F. Ward, Jr., Glusman, Ward, Moore & Lopez, Baton Rouge, for defendant-respondent.

John S. Campbell, Jr., and A. Michael Dufilho of Taylor, Porter, Brooks & Phillips, Jerry McKernan, Baton Rouge, for amicus curiae.

BARHAM, Justice.

We granted certiorari for the specific purpose of reconsidering this Court's decision in United States Fidelity and Guaranty Company v. Green, 252 La. 227, 210 So.2d 328 (1968) where this Court held that a creditor of the husband for antenuptial debts could not satisfy such debts by seizure of the effects of the community of acquets and gains. We now overrule that case and conclude that the husband's antenuptial debts may be satisfied from the assets of the community of acquets and gains.

G. L. Creech was married the first time to Neva F. Creech. On May 27, 1966 they were separated from bed and board by decree of the Family Court of East Baton Rouge Parish. Thereafter, on June 21, 1966, the parties executed a settlement of the community of acquets and gains previously existing between them.

By the terms of the community settlement Neva F. Creech received the family residence, various parcels of land, debentures, certain bank and finance company stock, and one-half of the stock of three businesses operated by G. L. Creech. In connection with this community settlement, the three corporations agreed to acquire the stock received by Neva F. Creech in the settlement. As consideration therefor a promissory note dated June 27, 1966 in the amount of $98,500 was executed by one of the corporations, Capitol Mack, Inc., and endorsed by G. L. Creech in payment of the stock Neva F. Creech transferred in that corporation.

Subsequently, in 1967, Neva F. Creech obtained a final divorce. Then on July 27, 1968 G. L. Creech married Barbara Carney Hair. The following September they acquired a house and lot which they occupied as a family residence.

Creech became delinquent in the payments due on the note held by his first wife. She therefore instituted suit for its collection on September 24, 1970 and obtained judgment on September 22, 1971 for the balance due, $90,500, plus interest and attorneys' fees. The judgment remained unpaid, and Neva F. Creech caused a writ of fieri facias to issue directing the seizure of the house and lot and the household effects contained therein, which at that time composed the family residence of G. L. Creech and his second wife.

Creech and his second wife intervened in the proceedings to enjoin the seizure and sale. They asserted that the property sought to be seized and sold in satisfaction of Creech's antenuptial debts belonged to the community of acquets and gains existing by virtue of the second marriage. They further alleged that under the authority of Article 2403 of the Civil Code the community estate was not responsible for the husband's antenuptial debts.

The trial judge found that the house and lot sought to be seized belonged to the community existing by virtue of Creech's second marriage. The various items of movable property were determined to be the separate property of the second wife. Accordingly, the trial judge sustained the position of the intervenors, holding that neither the house and lot belonging to the second community nor the wife's separate property could be seized in satisfaction of the debt incurred by the husband prior to the second marriage. The decision was based on Article 2403 of the Civil Code and the decision in United States Fidelity and Guaranty Company v. Green, supra. On appeal to the First Circuit, the judgment was affirmed. 268 So.2d 695 (1972).

The holding by our Court in the Green case was based on Civil Code Article 2403 which fixes the contractual obligations Between the spouses of a marriage and which does not attempt to establish the legal relations between a creditor and the husband. The Court failed to consider Civil Code Articles 3182 and 3183 which do establish Creditors' right against their debtors. Moreover, the Court there believed previously settled jurisprudence in regard to the community's liability for antenuptial debts had been overruled by cases which, in dictum or otherwise, made statements only in regard to the nature of the Interest of the wife in the community.

Two early cases, Dixon v. Dixon's Executors, 4 La. 188, 23 Am.Dec. 478 (1832) and Theall v. Theall, 7 La. 226, 26 Am.Dec. 501 (1834) are often cited for and discussed in view of broader holdings than actually are made in these cases. All that was said in Dixon is that the wife's right to the one-half interest in the community '* * * may be enforced not alone when the marriage is dissolved, but whenever the community ceases.' Its final holding is '* * * It is, therefore, clear, she has rights in the acquests (sic, acquets) before the husband dies; and after as much reflection as we are able to bestow on the subject, we can discover no reason why these rights do not Exist to the same extent, and should not be as susceptible of being enforced, When the community ceases by a repeal of the law, as they are When it terminates by a separation from bed and board.' (Emphasis here and elsewhere supplied.) The case makes no statement in relation to the obligation of the community for antenuptial debts, nor does it make any statement of the exact nature of the wife's rights in the community acquets during the marriage. The case merely recognizes the wife's rights upon the termination or dissolution of the community regime. Theall v. Theall is not concerned with the community during the marriage, nor with its obligations for antenuptial debts. It merely holds that the husband's mortis causa disposition of one-half of his estate conveys one-half of his interest in the community and that the wife takes one-half of the total community by reason of the contractual obligations flowing from the matrimonial regime creating the community of gains. ¹

In Guice v. Lawrence, Syndic., 2 La.Ann. 226 (1847), our Court specifically dealt for the first time with the obligation of the community for the debts of a husband created anterior to the marriage. The court said:

'The laws of Louisiana have never recognized a title in the wife during marriage, to one-half of the acquets and gains. The rule of the Spanish law on that subject, is laid down by Febrero with his usual precision. The ownership of the wife, says that author, is revocable and fictitious during marriage. As long as the husband lives and the marriage is not dissolved, the wife must not say that she has Gananciales, nor is she to prevent the husband from using them, under the pretext that the law gives her one-half. But, Soluto matrimonio, she becomes irrevocably the owner of one undivided half, in the manner provided by law for ordinary joint ownership. The husband is, during marriage, real y verdadero dueno de todos, y tiene en el efecto de su dominio irrevocable. Febrero Adic., tomo 1 y 4, part 2d, bk. 1st, chap. 4, parag. 1, nos. 29 and 30. Pothier, communaute, p. 35 and following. 12 Toullier, chap. 2, nos. 72 to 31. 14 Duranton, Droit Franc. p. 281 and foll. 10 Dalloz, Jurisp. p. 198 and fol.

'The provisions of our Code on the same subject are the embodiment of those of the spanish law, without any change. The husband is head and master of the community, and has power to alienate the immovables which compose it by an encumbered title, without the consent or permission of his wife. Civil Code, art. 2373. The voluntary surrender of his property by Smalley to his creditors, became him, after acceptance such an alienation. Under the express provisions of the act of 1826, he was absolutely divested of the title, and his creditors were vested with it. 2d Moreau's Dig. p. 437.'

It is true that Guice v. Lawrence takes point with some of the dictum in Dixon v. Dixon's Executors, but the two cases are not in direct conflict in their holdings. The clear holding in Guice is reaffirmed in Glenn v. Elam, 3 La.Ann. 611 (1848). Glenn v. Elam admits that the private and separate debts of the husband, created anterior to the marriage, may be satisfied out of the community during the marriage, but holds that upon the dissolution, to the extent that the separate property of the husband has been increased, remuneration must be made to the wife of one-half of that increase. Davis v. Compton, 13 La.Ann. 396 (1858) states,

'As the husband has the right to alienate the effect of the community without the consent of his wife, creditors of the husband before marriage ought also to have the right to seize the effects of the community to satisfy their claims. 2 An. 226, Guice v. Lawrence, Syndic; 3 An. 615, Glenn v. Elam.'

It further recognizes the right of reimbursement at the dissolution of the marriage for the increase in the separate and paraphernal property of either spouse during the marriage at the expense of the community.

Guice v. Lawrence, Glenn v. Elam, and Davis v. Compton differ from Dixon v. Dixon's Executors, and Theall v. Theall only in the discussion of the Nature of the interest of the wife in the community during the marriage. They are not in conflict upon the point of whether the community is responsible for the antenuptial debts of the husband. Fazzio v. Krieger, 226 La. 511, at 524, 76 So.2d 713, at 717 (1954). In fact, Guice v. Lawrence, Glenn v. Elam and Davis v. Compton were followed without deviation by our courts until the Green case. Hill v. Abell, 5 La.App. 497 (2d Cir. 1927); Favrot v. Paine and Bourgeois, 9 La.App. 30, 118 So. 775 (1st Cir. 1928); First National Bank of Ville Platte v. Coreil, 145 So. 395 (La.App.1st Cir. 1933); Magnolia Petroleum Co. v. Crigler, 12 So.2d 511 (La.App.2d Cir. 1942); Stafford v. Sumrall, 21 So.2d 83 (La.App.1st Cir....