Johnson v. Jouchert
| Decision Date | 27 May 1890 |
| Docket Number | 14,348 |
| Parties | Johnson et al. v. Jouchert et al |
| Court | Indiana Supreme Court |
From the Gibson Circuit Court.
Judgment affirmed, with costs.
T. R Paxton and L. C. Embree, for appellants.
C. A Buskirk, for appellees.
The questions for decision arise out of the following facts:
In January, 1884, Mrs. Grubbs, wife of Thomas J. Grubbs, was the owner of forty acres of land in Gibson county which she inherited from her father. She attempted to convey the land directly to her husband by a deed containing covenants of warranty, her purpose in making the conveyance being to enable her husband to mortgage it as security for a loan of four hundred dollars, which he had negotiated from the agent of Jouchert. The money was loaned, and the note of Grubbs secured by a mortgage on the land, in which both husband and wife joined, was taken as evidence of the debt. The husband expended $ 287 of the money borrowed in the purchase of real estate, the title to which was taken in the name of his wife, and in making improvements on the land purchased for her. Afterwards Grubbs and wife conveyed the land mortgaged by warranty deed to Smith, who subsequently conveyed by like deed to the appellants, John W. and George W. Johnson. The latter brought this suit for the purpose of having their title quieted and the mortgage executed by Grubbs and wife cancelled.
The conclusions stated by the court were to the effect that the mortgage was void as to the wife, but that the plaintiffs below, as subsequent purchasers of the land, under the ruling in Bennett v. Mattingly, 110 Ind. 197, 10 N.E. 299, could not avail themselves of her coverture for the purpose of avoiding the mortgage.
The conveyance from Mrs. Grubbs to her husband was a nullity. A married woman has no power or capacity to convey or encumber her separate real estate except by deed in which her husband shall join. Section 5117, R. S. 1881.
Any conveyance executed by her in which her husband has not joined is absolutely void, because of the want of capacity on her part to convey or encumber her real estate by such an instrument. Cook v. Walling, 117 Ind. 9, 19 N.E. 532. Besides, the common law rule respecting the unity of husband and wife prevails to such an extent in this State as to render nugatory any attempt by a married woman to convey her separate real estate directly to her husband unless the transaction can be sustained upon the principles of equity. Barnett v. Harshbarger, 105 Ind. 410, 5 N.E. 718; Harrell v. Harrell, 117 Ind. 94, 19 N.E. 621; Preston v. Fryer, 38 Md. 221; Gebb v. Rose, 40 Md. 387; 9 Am. and Eng. Encyc. of Law, pp. 789-791; Jenne v. Marble, 37 Mich. 319; 28 Cent. Law Jour. 438.
The conveyance from Mrs. Grubbs to her husband is, therefore, to be eliminated from the case, and the facts are to be considered as though she joined in a mortgage on her separate real estate to secure a loan of money negotiated by and made to her husband, who employed $ 287 of it in purchasing and improving other real estate for her, and the residue for his own personal benefit.
To the extent that the money borrowed was invested in property, the title to which was taken in the name of Mrs. Grubbs, for her separate use and benefit, the mortgage constituted a valid security. A mortgage properly executed by a married woman upon her separate real estate, is a valid and binding security unless it constitutes a contract of suretyship within the meaning of section 5119, R. S. 1881.
Strictly speaking, a contract of suretyship is an engagement whereby one person undertakes to answer for the debt, default or miscarriage of another, but the relation of surety may arise out of arrangements or equities between the parties to a contract, without any regard to its form. One whose relation to a contract or transaction is such as to entitle him to be indemnified in case he is compelled to pay a debt or perform an obligation for which he is bound with another, in order to relieve himself from personal liability or discharge his property from an encumbrance, may be said to stand in the relation of surety. Sefton v. Hargett, 113 Ind. 592, 15 N.E. 513; Smith v. Shelden, 35 Mich. 42; Wendlandt v. Sohre, 37 Minn. 162, 33 N.W. 700.
One who has received, and who retains, the consideration or benefit of a contract can not, in equity, occupy the attitude of a surety. Accordingly, it has been held again and again that, where money was borrowed by a wife, or by a husband and wife, or by either of them, for the purpose of discharging liens on the wife's separate property, or for a purpose which enures to the benefit of her estate, a mortgage properly executed on her separate property to secure the repayment of money so borrowed may be enforced. Noland v. State, ex rel., 115 Ind. 529, 18 N.E. 26, and cases cited. "With respect to contracts for her own benefit, or for the benefit of her estate, the power of a married woman is plenary." Juchert v. Johnson, 108 Ind. 436, 9 N.E. 413. To the extent that the consideration of a contract, or security enures to the benefit of a married woman, she occupies the attitude of a principal, for the plain reason that she would have no equitable right to be indemnified by some one else in case the contract or security should be enforced against her. Vogel v. Leichner, 102 Ind. 55, 1 N.E. 554.
A married woman, by force of section 5119, is protected, as at common law, in all transactions which do not relate to or benefit her separate estate, or business, or which are not to her personal benefit, but such as relate to or benefit her separate estate or her lawful business transactions, will be binding upon her. Haydock, etc., Co. v. Pier, 74 Wis. 582, 43 N.W. 502.
Although the facts found are not very definite upon the point, it may fairly be assumed that all the parties to the transaction knew of the purpose for which the money was borrowed. The creditor who took a mortgage on the separate estate of a married woman, as security for a loan made ostensibly to her husband, was bound, at his peril, to inquire; and since Mrs. Grubbs received and, so far as appears, retains the title to property purchased and paid for out of the money borrowed, it will be presumed that she had knowledge, and that she executed the mortgage upon the consideration that the principal part of the money was to be used in augmenting her separate estate. In respect to the money borrowed and thus applied, she would have no standing in a court of equity to enforce indemnity against her husband in case she is compelled to pay the debt. The conclusion follows, that to the extent of $ 287, with the interest accumulated thereon, the mortgage was not a contract of suretyship, but a valid encumbrance on the land when it was conveyed to the appellants. In respect to the residue, since the loan which the mortgage was given to secure was made to her husband and applied to his personal use, she occupied the relation of surety, and the mortgage was invalid. The inquiry remains, can the appellants, who are remote grantees of Mrs. Grubbs, avail themselves of the invalidity of the mortgage?
The court below was of the opinion that, although the mortgage was void in toto, the appellants, as subsequent grantees, were not in a situation to avail themselves of its invalidity. A parallel is supposed to exist between the civil acts, contracts and deeds of married women and those of infants, and it has been said that coverture, like infancy is a personal defence, and hence one which can not be made by a third party for his own benefit. Bennett v. Mattingly, supra; AEtna Ins. Co. v. Baker, 71 Ind. 102; Crooks v. Kennett, 111 Ind. 347, 12 N.E. 715. This statement is true in a limited and qualified sense. The contracts of infants, according to modern classification, are either valid or voidable, while that of married women are, as a rule, either void or voidable. The contracts of infants, which are voidable at the election of the infants, are distinguishable from those of married women, which, owing to the disability of coverture, are void at common law, and when constituting contracts of suretyship,...
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