Birmingham Trust & Sav. Co. v. Howell

• Decision Date: 30 May 1918
• Docket Number: 6 Div. 738
• Citation: 79 So. 377,202 Ala. 39
• Parties: BIRMINGHAM TRUST & SAVINGS CO. et al. v. HOWELL.
• Court: Alabama Supreme Court

79 So. 377

202 Ala. 39

BIRMINGHAM TRUST & SAVINGS CO. et al. v. HOWELL.

6 Div. 738

Supreme Court of Alabama

May 30, 1918

Appeal from Circuit Court, Jefferson County; Hugh A. Locke, Judge.

Bill by Fannie J. Howell against the Birmingham Trust & Savings Company and others, to cancel a note and mortgage because given for the debt of the husband. From decree for complainant, respondents appeal. Reversed, rendered, and remanded.

Smyer &amp Smith, of Birmingham, for appellants.

C.B Powell, of Birmingham, for appellee.

SOMERVILLE J.

The single question presented by the appeal is whether a wife who has executed jointly with her husband a negotiable note secured by a mortgage on her separate estate, can avoid the note and mortgage as against a transferee who is a holder of the note in due course, as defined by section 5007 of the Code. Our cases have uniformly declared that such attempted obligations and conveyances by the wife are void, being incapable of ratification (without a new and valid consideration), and requiring no act of disaffirmance to avoid them. Code, § 4498; Union, etc., Bank v. Hartwell, 84 Ala. 379, 4 So. 156; Richardson v. Stephens, 122 Ala. 301, 25 So. 39; Evans v. Faircloth, 165 Ala. 178, 51 So. 785, 21 Ann.Cas.1164; Trotter v. Downs, 75 So. 906. None of these cases, however, involves the rights of a holder of negotiable securities in due course, by transfer from the original payee. What they hold is that such obligations by the wife are void, considered without reference to the principles of the law merchant. In the case of Scott v. Taul, 115 Ala. 529, 22 So. 447, the identical question here raised was presented and decided. The court there said:

"The note in the complaint, having been made payable at a bank, was governed by the commercial law. The purchaser of such a paper, in the usual course of business, before its maturity, for a valuable consideration, having no notice of defenses that existed between the original parties, or have subsequently arisen, as we have frequently held, is a bona fide holder for value, and as such takes the instrument freed from defenses which were available between the original parties."

This decision has never been questioned, so far as we are advised, but, on the contrary, upon very deliberate consideration, its principle has been recently approved and reaffirmed. Davies v. Simpson, 79 So. 48. Although the result may be a material emasculation of the statute prohibiting suretyship by the wife for the husband's debt (Code, § 4497), and although that decision may be technically inconsistent with the established theory that the wife's contracts of suretyship are per se void, we nevertheless feel bound to adhere to the principle declared in Scott v. Taul. See, also, 8 C.J. 774, and note 81.

A joint undertaking by husband and wife imports,...