Goldburg Co Inc v. Salyer

• Decision Date: 22 November 1948
• Citation: 50 S.E.2d 272,188 Va. 573
• Court: Virginia Supreme Court
• Parties: GOLDBURG CO, Inc. v. SALYER.

50 S.E.2d 272

188 Va. 573

GOLDBURG CO, Inc.

v.SALYER.

Supreme Court of Appeals of Virginia.

Nov. 22, 1948.

Error to Circuit Court, Wise County; George Morton, Judge.

Execution proceeding by Goldburg Company, Inc., against P. W. Salyer, trading as Electrical Appliance Company, Inc., wherein defendant set up a claim for a homestead exemption in the proceeds of a fire insurance policy. To review a judgment for the defendant, plaintiff brings error.

Affirmed.

Before HUDGINS, C. J., and GREGORY, EGGLESTON, SPRATLEY, BUCHANAN, STAPLES, and MILLER, JJ.

William T. Bowen, of Norton, H. J. Riser, of Wise, and A. P. Kingdon, of Blue-field, W. Va., for plaintiff in error.

M. W. Vicars, of Wise, for defendant in error.

SPRATLEY, Justice.

This is a controversy between Goldburg Company, Inc., the appellant, a creditor of P. W. Salyer, over a claim of the latter to a homestead exemption in the proceeds of a fire insurance policy in payment of a loss on a shifting stock of merchandise and fixtures.

The record consists only of the pleadings, a scanty, agreed stipulation of facts, and the judgment of the trial court.

On June 4, 1947, a writ of fieri facias was sued out of the Clerk's Office of the Circuit Court of the county of Wise, Virginia, in favor of Goldburg Company, Inc., against P. W. Salyer, trading as Electrical Appliance Company, Inc., for $335.04, with interest and costs. On the following day, Goldburg Company, Inc., caused a summons in garnishment to be issued against the Manhattan Fire & Marine Insurance Company and the New Brunswick Fire Insurance Company requiring them to answer as to their indebtedness to Salyer.

The New Brunswick Fire Insurance Company answered and said that it was not indebted to Salyer in any amount whatsoever. It further averred that on March 28, 1947, it had paid in full to the holders a total loss under a policy of fire insurance, which had been held by P. W. Salyer and P. L. Taylor, trading as Electrical Appliance Company, Inc., and that at the time of payment it had no knowledge of any debt due or owing by Salyer to the Goldburg Company.

The Manhattan Fire & Marine Insurance Company answered and said that, while it did owe $1,250 to P. W. Salyer and P. L. Taylor, trading as Electrical Appliance Company, Inc., by virtue of a policy of fire insurance, it had by reason of a number of garnishee actions served upon it in the trial justice court for Wise county, Virginia, filed a bill of interpleader in that cOurt, and pursuant to an order had paid the said sum into that court, and had been discharged from its obligations.

This is the stipulation as to the facts:

"It is stipulated by Counsel for plaintiff and Counsel for Principal Defendant, P. W. Salyer as follows:

"That Goldburg & Company, Inc., has a valid judgment against the defendant, P. W. Salyer; for a debt upon contract;

"That execution has issued on the same and funds in the hands of Manhattan Fire & Marine Insurance Co. (which has heretofore been paid into the Trial Justice Court) and funds in the hands of the New Brunswick Fire Insurance Company, have been garnisheed for the satisfaction of said execution; That said insurance fund is in payment of a loss of a shifting stock of merchandise and fixtures.

"That the debt upon which the judgment was taken does not waive the Homestead Exemption;

"That prior to the date of said judgment, P. W. Salyer, a married man (wife and two children, age 9 and 7 respectively) a householder and head of a family, residing in Wise, Wise County, Virginia, did on the 29th day of March, 1947, exercise his Constitutional privilege of claiming as exempt from garnishment, the said funds due to him from said Insurance Companies, which said Homestead was duly recorded in the Clerk's Office for Wise County, in Miscellaneous lien Book No. 8, page 229, on the 9th day of May, 1947."

The homestead exemption above referred to reads as follows:

"Know All Men By These Presents, That I, P. W. Salyer, a native born white American citizen, residing at Wise, Wise County, Virginia, being over the age of twenty-one years and a householder and head of a family, do hereby declare my intention to, and do hereby file and claim this my Homestead Exemption, under the Constitution of Virginia and the statutes enacted in pursuance thereof, the following property and money due to me, as exempt from levy and garnishment for any and all debts owed by me upon contract.

"1. One Thousand dollars ($1,000) due to me from the Manhattan Fire and Marine Insurance Company, 99 John St, New York, N. Y.

"2. One Thousand dollars ($1,000) due to me from the New Brunswick Fire Insurance Company, of New Brunswick, New Jersey.

"I have not heretofore claimed my exemptions under the Homestead Laws.

"Given under my hand and seal this the 29th day of March, 1947.

"P. W. Salyer (Seal)."

On August 25, 1947, the proceeding came on to be heard before the trial judge, neither party demanding a jury. The trial court being of opinion that the defendant was entitled to the benefit of his homestead exemption and entitled to receive the money owing to him by the two fire insurance companies, dismissed the garnishee summons, directed that $2,000 of the monies due from the two fire insurance companies be paid to the defendant, the balance to be distributed by order of the court, and entered a judgment against the plaintiff for the cost of the proceeding.

The record does not disclose when the fire loss occurred; but it is obvious that it occurred before the fieri facias in favor of appellant was issued and before this proceeding was instituted. It does not disclose the respective values of the stock of merchandise and fixtures destroyed. Although appellant, in his brief, states that its judgment was upon an open account for merchandise sold and delivered to Salyer, the record itself does not show that the judgment was to recover other than "for a debt upon contract."

The sole assignment of error is that, since a portion of the insurance money was in payment of the shifting stock of merchandise, not itself exempt, no exemption can be applied to such proceeds.

The exact question here raised has never heretofore been presented to us. No case from any other jurisdiction, based upon the same facts, or upon constitutional and statutory provisions similar to those of Virginia, has been cited to us. The determination of the question must depend upon the construction to be given our Constitution and statutes relative to the exemption of personal property from sale and execution.

Under the Constitution of Virginia, section 193, and by the great weight of authority, homestead exemption provisions are considered as remedial, and the rule is that they must be liberally construed in favor of the debtor and strictly against the creditor. They are enacted to insure the unfortunate debtor and his equally unfortunate, but more helpless family, a means of shelter and a measure of existence. 26 Am.Jur, Homestead, section 11, page 13; 40 C.J.S, Homesteads, § 8, page 438.

In most jurisdictions, but not in all, funds realized from the insurance of exempted property are themselves exempted. The money is deemed to represent or stand in the place of the property which has beendestroyed. 40 C.J.S., Homesteads, § 74, page 513; 26 Am.Jur., Homestead, section 51, page 33.

See Annotation and numerous cases cited 63 A.L.R. page 1286.

The pertinent provisions of our Constitution and statutes are set out below.

Section 190 of the Constitution provides: "Every householder or head of a family shall be entitled, in addition to the articles now exempt from levy or distress for rent, to hold exempt from levy, seizure, garnishment, or sale under execution, order, or other process issued on any demand for a debt hereafter contracted, his real and personal property, or either, including money and debts due him, to the value of not exceeding two thousand dollars, to be selected by him; provided, that such...