Ex parte Lacy, 7 Div. 362

• Decision Date: 30 April 1936
• Docket Number: 7 Div. 362
• Citation: 232 Ala. 525,168 So. 554
• Parties: Ex parte LACY. v. COMMERCIAL NAT. BANK OF ANNISTON. LACY
• Court: Alabama Supreme Court

168 So. 554

232 Ala. 525

Ex parte LACY.

LACY v. COMMERCIAL NAT. BANK OF ANNISTON.

7 Div. 362

Supreme Court of Alabama

April 30, 1936

Rehearing Denied June 11, 1936

Appeal from Circuit Court, Calhoun County; R.B. Carr, Judge.

Suit by Ina K. Lacy against the Commercial National Bank of Anniston for cancellation of a transfer of stock and a mortgage and an accounting, in which respondent filed a cross-bill. From a decree denying the relief prayed in part, complainant appeals. On appellant's petition for a writ of prohibition or mandamus and on the merits.

Petition and writ denied, decree affirmed in part and reversed in part, and cause remanded.

Appeal from decree by married woman, whose husband died before final submission of case to Supreme Court, did not supersede execution. Code 1923, § 6138.

Ross Blackmon and Knox, Acker, Sterne & Liles, all of Anniston for appellant.

Merrill Jones & Whiteside, of Anniston, for appellee.

THOMAS Justice.

The submission was upon the petition for writ of prohibition or mandamus, and on the merits, as one case.

The prayer of the petition was that the respondent, the presiding judge in said cause, enter an order suspending the enforcement of the decree pending the appeal to this court the grounds thereof being that petitioner was a married woman when the bill was filed, that her husband died before final submission and decree, and that she alleges she is entitled to the benefits accorded to a married woman under section 6138 of the Code.

That statute provides: "From any judgment, order or decree of any court of record, subjecting to sale any property of, or for the payment of money or the doing or performing any act by any married woman, she is entitled to an appeal to the supreme court or court of appeals to revise such judgment, order, or decree, without giving security for the costs of appeal; on making affidavit that she is unable to give such security; and such appeal shall operate as a suspension and stay of any proceedings under such judgment, order or decree until such appeal shall be determined by the supreme court or court of appeals." Section 6138, Code 1923.

Under the facts contained in the pleading, the specific wording of the statute, and the analogy contained in constructions of the statute and cases coming within its purview, the appeal as taken did not supersede the execution of the decree. She was not subject to the disability of coverature at the time of the appeal. Lea v. Phillips et ux., 216 Ala. 35, 112 So. 323; Watkins (Citizens' Bank v. Watkins),

226 Ala. 634, 148 So. 335.

A decree or judgment dates from the time of its rendition. Sims' Chan.Prac. § 565, p. 325; Ex parte Massie, 131 Ala. 62, 31 So. 483, 56 L.R.A. 671, 90 Am.St.Rep. 20; Powe v. McLeod & Co., 76 Ala. 418.

It is held that the filing of an affidavit of inability to give security for costs of appeal will not supersede execution of the decree, when such security has been previously filed. Ex parte Barkley, 210 Ala. 466, 98 So. 463.

It follows that the petition and writ prayed is denied. However, the petition and the merits were submitted as one, and we must proceed to a consideration of the latter.

On this appeal, the original complainant, Ina K. Lacy, in challenging the action of the trial court assigns, among others, the following errors:

"1. The court erred in its decree *** in determining that the transfer by the appellant, Ina K. Lacy, of the fifty shares of her capital stock in respondent bank to have been an outright sale of said stock by the appellant to said bank, and not a pledge thereof as a surety, either directly or indirectly, of the indebtedness of S.A. Lacy to said bank."

"4. The court erred in its decree to the effect that $3,340.91, of the money loaned by the Commercial National Bank in pursuance of the mortgage involved in this cause, which was executed to the bank by the appellant here, to secure the payment of said bank of $6,500, was turned over to S.A. Lacy in pursuance of an agreement with Ina K. Lacy, said Commercial National Bank and S.A. Lacy, that said funds should be paid over by Ina K. Lacy to S.A. Lacy and be used by him in paying off his indebtedness in part to the First National Bank of Eutaw ***.

"5. The court erred in applying any portion of the $3,340.91 realized out of Mrs. Ina K. Lacy's real estate mortgage loan to the indebtedness of the First National Bank of Eutaw ***.

"6. The court erred in its decree in prorating the payments which were made on the mortgage indebtedness of $6,500 involved in this record, ratably between the void portion of the mortgage, to-wit: $3,340.91, and the valid portion of the mortgage, to-wit: $3,159.09, it being true as a matter of law that the court was without authority to impart validity to the void part of the transaction ***.

"7. The court erred in failing to credit the $3,159.09, part of the mortgage loan determined by its decree to have been valid with the entire payments of interest and principal made on the original mortgage indebtedness of $6,500, by reason of the fact that this valid portion of said mortgage indebtedness was the only legal and binding liability against the appellant, the payment of which was secured as a matter of law by the real estate mortgage involved in this suit ***.

"8. The court erred in its decree in the cause in deciding that the appellant was not entitled to recover from the appellee the $6,000 in cash representing the stock transaction together with the $3,340.91, representing the void portion of the real estate mortgage, making a total sum of $9,340.91, which the court should have decreed to have been due by the bank to the appellant with interest thereon from to-wit: 15th day of January, 1930, ***.

"9. The court erred in decreeing the transfer of the stock by Ina K. Lacy to the Commercial National Bank, and the real estate mortgage by her to said bank to have been separate and distinct transactions by decreeing in effect the transfer of the stock to have been an outright sale and not a part of one loan and one transaction ***."

The original bill by appellant challenged the transaction or agreement of parties under the statute, Code, § 8272, as to the transfer of complainant's stock in respondent bank; the mortgage of her real properties and application of funds derived to the security and payment of the husband's large indebtedness to respondent bank. A cross-bill was filed by the bank challenging the validity of complainant's title to the real estate mortgaged, under the deed from her husband for a valuable consideration. The trial court sustained its validity, and the evidence supports that finding; there is no cross-appeal, and the decree in this respect is correct. Moore et al. v. Esslinger et al. (Maryland Casualty Co. et al. v. Moore et al.) (Ala.Sup.) 167 So. 328.

The trial court correctly found that the mortgage from Mrs. Lacy to respondent bank was valid as to the amount or extent thereof, as proceeds therefrom were applied to complainant's debts to the bank. And in this respect the decree is affirmed. All payments made thereon by Mrs. Lacy are to be appropriated to the reduction of her mortgage, leaving a balance, as we understand the evidence, of about $2,482.11, and interest. This is the result of the rule of application of payments to the debt such debtor is bound to pay under the law. Osborne v. Cooper, 113 Ala. 405, 410, 21 So. 320, 59 Am.St.Rep. 117; Armour Packing Co. of La., Ltd., v. Vinegar Bend Lumber Co., 149 Ala. 205, 42 So. 866, 13 Ann.Cas. 951; Tuscaloosa Lumber Co. v. Tropical Paint & Oil Co., 211 Ala. 258, 100 So. 236; Leath et ux. v. Hancock, 210 Ala. 374, 98 So. 274; Taylor & Co. v. Cockrell et al., 80 Ala. 236.

The evidence shows that Mrs. Lacy never gave direction or consent as to how her payments on the mortgage on her home should be applied. Therefore, the bank has no right to make application of payments, principal or interest, upon or to the illegal and unenforceable amounts of indebtedness embraced in Mrs. Lacy's mortgage; nor had the bank the right to apply to other debts the proceeds of the sale of stock held by the Bank of Eutaw as collateral, without consent and not to the prejudice of the wife.

The court was in error in treating the transaction as to the wife's shares of stock in respondent bank, the giving of the mortgage on the wife's home, and the payment of the draft by the Eutaw Bank, as several and not one transaction. They were all done in the adjustment, liquidation, or payment of the husband's debts. Was, then, dealing with her bank stock, giving a mortgage on her home, and giving her husband a check, under the agreement that the moneys paid her by the bank would be so used and be immediately paid by him back to the bank on his debt, condemned as an evasion of the statute and ruled by the decisions applying to that statute? Trotter Bros. v. Downs, 200 Ala. 158, 75 So. 906.

We have indicated that the mortgage given by the wife, to the extent that it was surety for the husband, will be condemned; and will be held valid to the extent that it was given to pay or secure her separate debt. Trotter Bros. v. Downs, supra; Mills et al. v. Hudmon & Co., 175 Ala. 448, 57 So 739; Staples v. City Bank & Trust Co., 194 Ala. 687, 70 So. 115. The case of Bell v. Henderson Nat. Bank, 225 Ala. 398, 143 So. 568, 569, involved "the rights of a purchaser from the husband to whom the wife had conveyed the property and where the proof fails to connect the third party with practicing or participating in any fraud on the wife." In this case, the evidence shows no debt or moneyed benefit accrued to or was assumed by the wife in the payment of the husband's debt to the bank, or in payment of the draft to the Eutaw Bank, which...