Lindley v. Davis
| Citation | 14 P. 717,7 Mont. 206 |
| Parties | LINDLEY v. DAVIS and another. |
| Decision Date | 29 July 1887 |
| Court | Montana Supreme Court |
Appeal from district court, Gallatin county.
Luce & Armstrong, for appellant.
J. J Davis, for respondents.
This was an action of ejectment. Respondents, in their answer disclaimed as to a part of the premises, and set up homestead exemption as to the remainder. Appellant, in his replication denies the right of respondents to homestead. Trial by the court, sitting instead of a jury. Judgment for defendants and appeal in error by plaintiff.
There seems to be no dispute about the facts. Those material to be noticed are as follows, to-wit: William H. Babcock conveyed an undivided half interest in fee-simple to the disputed premises--a house and lot--to respondent Will F. Davis, June 3, 1881; said Babcock having the fee-simple title to the whole of it prior to that time. Respondents, Will F. Davis and Ollie I. Davis, were intermarried May 27, 1883, and began to occupy said house and lot as their home, October 10, 1883, and made formal declaration of homestead, November 17, 1883, and had it duly recorded. Nelson Story commenced suit against W. H. Babcock and Will F. Davis, as partners, under the firm name and style of Babcock & Davis, and sued out an attachment, and had it levied on said house and lot, November 28, 1883. Said Nelson Story recovered judgment in said suit, September 26, 1884. Appellant, Lindley, purchased of Story this judgment. Execution was issued October 1, 1884, and the lot sold and purchased by appellant, who took a sheriff's deed. Babcock and Davis were partners in the business of loaning money and selling real estate. They executed partition deeds in severalty of their real estate, June 3, 1884, by which respondent Will F. Davis became sole owner in fee-simple of the house and lot in controversy, but after the levy of the attachment, November 28, 1883. While Babcock and Davis were partners they held the title to this house and lot, not in their firm name of Babcock & Davis, but in their individual names, as tenants in common. After Davis became the sole owner of the house and lot, June 3, 1884, he filed, and had duly recorded, another declaration, claiming homestead therein. Appellant purchased the judgment of Story, and the house and lot, at sheriff's sale, with full notice of the homestead claim of respondent, who served notice of his claim on the sheriff before the sale, which notice the sheriff read at the time of the sale. It is conceded that the lot does not contain over one-quarter of an acre, and the value of the house and lot is not over $2,400. The respondent, as the head of a family, occupied and claimed the house and lot, which are situated in the town of Bozeman, as a homestead, from October 10, 1883, up to the present time.
The sole question, then, is, did the court err in finding that the respondents were entitled to a homestead exemption, under the foregoing state of facts? The rights of the appellant relate to the time of the reception of the lien of the attachment. The respondents, in their claim of a homestead, must stand or fall upon the title of the respondent Will F. Davis to an undivided half interest in the premises in controversy at that time. We are met upon the threshold of this discussion, with this question: What are the interests of respondent, Davis, in the premises in controversy? Were they partnership property? If so, must they not be regarded as a part of the capital stock of the concern, and as personalty? We find the doctrine upon this subject very clearly stated in the case of Hewitt v. Rankin, 41 Iowa, 35: citing Meily v. Wood, 71 Pa. St. 488; 1 Wash. Real Prop. (3d Ed.) 574; Lindl. Partn. 463.
The conversion of real property into personalty is a device of equity, in order to effectuate the settlement of partnerships. The rule closes when the partnership is settled, and its debts are paid. The partners then hold their real estate as tenants in common, relieved of any trust in behalf of the partnership. The weight of American authorities sustains this doctrine. Freem. Co-Tenancy, '118. If the decision of this case rested upon the doctrine above stated, then the respondents cannot be allowed a homestead, for this exemption cannot be carved out of personal property. The fact that tenants in common are also partners does not of itself invest the realty with any of the characteristics of personalty; nor is the fact that it was paid for out of partnership money decisive of the question. Copartners may withdraw realty from the partnership for the purpose of holding it severally; and in this event they become simple co-tenants in such land. Freem. Co-Tenancy, '114.
In this case, Babcock & Davis built the house with partnership money, in the years 1880, 1881, and lived in it. In May, 1883, Davis married, and October 10, 1883, moved with his wife into this house, for the purpose of making it his home. On November 11th following, he filed his declaration, claiming it as his homestead, and had it duly recorded. This, we take it, was a public withdrawal of this house and lot from the partnership assets, and a dedication of it as a homestead. Babcock, by his silence at least, consented to it, and in June, 1884, in confirmation of what had already been done, he executed a deed of his undivided half to Davis. We think, as a matter of fact, it is clear, from the proof in the case, that it was not the intention of the copartners, to hold this house and lot as any part of their partnership assets or stock in trade, but to withdraw it, if it ever had been such, that Davis might have it as a home. This dedication of the place as a homestead was made before the levy of the attachment. Story had full knowledge of respondents' claim when he sued out the attachment, and so had Lindley, the appellant, when he purchased the judgment, and had the house sold, and took his sheriff's deed. There is no pretext that the firm was insolvent at the time this homestead was set apart and claimed as such, or that there existed equitable grounds upon which it should be subjected to the payment of appellant's judgment, notwithstanding its withdrawal from the partnership assets, and dedication to the purposes of a homestead. We hold that, under the proof in the record, Babcock & Davis were tenants in common of the house and lot in controversy, and the question is whether a co-tenant is entitled to a homestead exemption under our law. We think he is, and that the judgment of the court below should be affirmed.
This case was heard at the last term of this court, and reversed; the court holding that the respondents were not entitled to a homestead. 6 Mont. 453, 13 P. 118. The learned justice who wrote the opinion placed the decision upon the ground that our statute granting the homestead exemption was taken from the California act, and the courts of that state held that a tenant in common in land was not entitled to the homestead exemption. They had so held before the passage of our act, and this was a sufficient evidence of what the legislative will was in the passage of our act. This court, however, before adjournment, granted a rehearing of the case, and vacated the order reversing it, and continued it until this term. This case is now before us for final determination.
The decisions of the different courts of last resort in the several states and territories are in hopeless conflict, --some of the judges giving to the language of the homestead exemption statutes a liberal construction, and holding tenants in common in land entitled to the exemption; while others, giving a strict construction, hold that they are not entitled thereto. But we are told that we are bound by the California decisions already referred to. We do not think so. By a comparison of our statute with that of Minnesota, we find it almost a verbatim copy of the Minnesota law on the subject of homestead. There is no mistaking the fact that the draughtsman of our statute copied it from the Minnesota statute, (St. Minn. 498, Revision 1866.)
There is much similarity between our statute and that of California. Our section 313 is common to both the California and Minnesota statutes; but there are material matters about which they widely differ. The only measure of the homestead is its value under the California act. The homesteader is entitled to $5,000 worth of realty, no matter where situated or for what purpose used. Under our act, if the homestead is land used for agricultural purposes, and not in any town plot, city, or village, 160 acres are allowed, provided its value does not exceed $2,500; or, if it is a lot in a town plot, city, or village, then it must not exceed one-fourth of an acre, and its value must not exceed $2,500. The homesteader may take his choice of the farm in the country, or the lot in town, the value being the same. These are precisely the provisions of the Minnesota statute, except the former cannot exceed 80 acres, and, instead of one-fourth of an acre in town, it says one lot. The attention of the court was not called to the Minnesota statute last term, nor did it have the whole of the California act...
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