Eberhardt v. Wahl's Adm'r

• Decision Date: 09 January 1907
• Citation: Eberhardt v. Wahl's Adm'r, 124 Ky. 223, 98 S. W. 994 (Ky. Ct. App. 1907)
• Parties: EBERHARDT ET AL. v. WAHL'S ADM'R.
• Court: Kentucky Court of Appeals

98 S.W. 994

124 Ky. 223

EBERHARDT ET AL. v. WAHL'S ADM'R.

Court of Appeals of Kentucky.

January 9, 1907

Appeal from Circuit Court, Daviess County.

"To be officially reported."

Suit by the administrator of Lewis Wahl against Jacob Eberhardt and others, in which Ella Eberhardt intervened. From a judgment in favor of plaintiff, defendant and intervener appeals. Reversed and remanded.

Miller & Todd, for appellant.

W. E. Aud and Geo. C. Triplett, for appellee.

O'REAR C.J.

Appellee as judgment creditor of Jacob Eberhardt, brought this equitable action to discover assets, and attached 10 shares of stock in the Vollman Buggy Body Company, standing in Jacob Eberhardt's name. Ella Eberhardt, wife of Jacob intervened, claiming the stock was in pledge to her under the following conditions: Her husband borrowed $500 from a bank to buy the stock. He executed two notes of $250 each to evidence the debt. To secure the bank, he pledged his stock to secure the first of the notes, and she pledged 10 shares of stock in her own name to secure the second. She paid off $250 of the debt, the first note, with her own means whereupon the bank released the husband's stock. The intention was to pay off the debt on which her stock was pledged. But, by mistake, the other note was paid off. She returned to the bank to have the mistake corrected. The bank officials told her that it would amount to the same thing if her husband delivered his shares to her in pledge to secure the sum she had paid for him, and as indemnity against loss by reason of the pledge of her own stock on the other note. Which arrangement was then made between the husband and wife. But it was not in writing, and, of course, in consequence not acknowledged or recorded. We think the arrangement between the husband and wife was void as to third persons, and the circuit court so treated it as to the suing creditor. The judgment was to sell the stock of Jacob Eberhardt to satisfy appellee's debt, without reference to any right of appellant Ella Eberhardt. Mrs. Eberhardt appeals.

She contends that, under the existing married woman's act (section 2128, Ky. St. 1903), it is competent for husband and wife to deal with each other with respect to her property as if she were single. In that section it is provided: "A gift, transfer or assignment of personal property between husband and wife shall not be valid as to third persons unless the same be in writing, and acknowledged and recorded as chattel mortgages are required to be recorded." This proviso follows the clause in the section: "She may make contracts and sue and be sued as a single woman." We think the proviso as to dealings between husband and wife was intended as a qualification of the previous general power conferred upon married women by the statute. It was recognized that their relation was one affording amplest opportunities for the practicing of fraud against creditors of either, unless their dealings with respect to their property were made the subject of public record. As they generally live together and use each other's property in common, there would be no visible change of possession to indicate a change of ownership. Persons crediting the former real owner might then be misled into believing that no change in the title had occurred, and upon the faith of such apparent condition give credit where there was not property to support it.

The Legislature, in removing the disability of married women to deal as single persons respecting their property, saw fit to so qualify the privilege as to make it conditional when the dealing was with a spouse. Unless the condition is complied with, the qualified privilege extended by the statute cannot attach. What has been said above applies alone to the transaction between Eberhardt and his wife. It must be borne in mind always in the construction of this statute that the qualification above treated of deals alone with the rights of married people in transactions between themselves. The married woman, when dealing with...