Keith v. Albrecht

• Decision Date: 08 May 1903
• Docket Number: 13,474 - (78)
• Citation: 94 N.W. 677,89 Minn. 247
• Parties: CHARLES H. KEITH v. ANNA ALBRECHT
• Court: Minnesota Supreme Court

94 N.W. 677

89 Minn. 247

CHARLES H. KEITH v. ANNA ALBRECHT

Nos. 13,474 - (78)

Supreme Court of Minnesota

May 8, 1903

Appeal by plaintiff from an order of the district court for Lac qui Parle county, Powers, J., granting a motion for a new trial.Affirmed.

SYLLABUS

Homestead -- Equitable Title.

A homestead may be claimed in land of which a party is in possession under a contract of purchase, or under any other equitable title, as well as if it were a legal title.

Homestead -- Land not Exempt.

A homestead claimant, who is the equitable owner of land by virtue of a contract of purchase, a part of which is his homestead, has, as between himself and his creditors, the same right to have the nonexempt part of his land first applied to the discharge of the lien of the vendor for the unpaid purchase price as he would have if he held the legal title, and had given a mortgage on the land to secure payment of the purchase price.

Conveyance not Fraudulent.

The defendant's husband was the equitable owner of a quarter section of land by virtue of a contract of purchase, eighty acres of which was his homestead.His interest in the land was transferred to the defendant without consideration, by the vendor's cancelling his contract and making a similar one to the defendant.At this time the nonexempt part of the land was beyond question worth materially less than the lien on the land for the unpaid purchase price.Held, following Horton v. Kelly,40 Minn. 193, that the conveyance was not fraudulent as to the husband's creditors at the time.

Cliff & Purcell and R. G. Farrington, for appellant.

Frank Palmer, for respondent.

OPINION

START, C.J.

Action to set aside a transfer of a quarter section of land in the county of Lac qui Parle to the defendant as fraudulent as to the creditors of her husband, John Albrecht.The cause was tried by a referee, who, as a conclusion of law from his findings of fact, found that the conveyance was fraudulent as alleged; that the defendant held the land, and the whole thereof, in trust in favor of the creditors of her husband that it be sold, and the proceeds thereof applied to the payment of the claims of such creditors; and that judgment be so entered.The defendant then made a motion to set aside the report and decision of the referee, and for a new trial of the action, which was granted, and the plaintiff appealed from the order of the court granting a new trial.

There is but little dispute as to the material facts of the case, and the real question here to be determined is whether the facts justify the conclusion of law of the referee.The here material facts as found by the referee or admitted by the parties on the trial are, in substance, these: On February 25, 1892, John F. Rosenwald and J. J. Little were the owners in fee of the one hundred sixty acres of land here in question, and on that day they entered into a written contract with John Albrecht, the defendant's husband, whereby they sold and agreed to convey to him the land upon being paid therefor the sum of $1,920 in installments, which, with all taxes on the land, he agreed to pay as they became due.It was further agreed between the parties that, if he made default in such payments, or any part thereof, the contract should be void at the election of the vendors, and that he should, on their demand, surrender possession of the land.The land at this time was vacant, and there were no improvements thereon.On the day named, the vendee, with his family, entered into possession of the land, and they have since resided thereon.His residence, barn, and other buildings are on the south half of the quarter section, and have been ever since he and his family entered into possession of the land.

On November 17, 1897, there was due and unpaid on the purchase price of the land to the vendors the sum of $1,896.68, and they then cancelled the contract to convey the land with the consent of the vendee, and in place thereof executed a contract to his wife to convey the land to her upon being paid the balance of the purchase price.She paid no consideration for the contract to her, but the consideration therefor was the payments which her husband had previously made on his contract for the land.On December 22, 1899, the vendors conveyed the land by warranty deed to the defendant, which was duly recorded.The balance of the purchase price then due was $2,000, which was secured by two mortgages on the land.There has been paid on the mortgages four or five hundred dollars; the exact amount, or by whom paid, the evidence fails to show.

At the time the contract for the land was made to the defendant, the whole land was of the value of $2,500, and no more.The north half thereof was then of no greater value than $1,200.The value of the whole of the land, when the deed was made to the defendant, was $2,600.When the contract of John Albrecht was cancelled, and a contract for the land made to the defendant, he was insolvent.His debts aggregated some $1,000, and have never been paid.On January 24, 1900, he was, upon his own petition, adjudged a bankrupt.The plaintiff is the duly appointed and qualified trustee of his estate.

Do these facts justify the referee's conclusion of law?The answer to this question depends upon whether the south half of the land was the homestead of the debtor, Albrecht, at the time his contract for the land was cancelled and a new one given to the defendant; and, if so, whether the...