Mcelyea v. Mcelyea., 4895.

• Decision Date: 18 October 1945
• Docket Number: No. 4895.,4895.
• Citation: 163 P.2d 635,49 N.M. 322
• Parties: McELYEAv.McELYEA.
• Court: New Mexico Supreme Court

49 N.M. 322

163 P.2d 635

McELYEA

v.McELYEA.

No. 4895.

Supreme Court of New Mexico.

Oct. 18, 1945.

Appeal from District Court, Dana Ana County; Charles H. Fowler, Judge.

Action by Oscar C. McElyea against Opal McElyea to determine the interests of the plaintiff and defendant in real and personal property held in name of one or the other of them. From a judgment, defendant appeals.

Affirmed in part and in part reversed with instructions.

Where husband had been more than generous toward wife and deposited in a joint bank account many thousands of dollars to which he was entitled as rental value of his farm and made no preparation for protection of his separate income, he would not be required to pay her attorney's fees in Supreme Court on her appeal from judgment determining parties' interests in property.

[163 P.2d 636 , 49 N.M. 323]

Edwin Mechem and R. R. Posey, both of Las Cruces, for appellant.

R. C. Garland and W. C. Whatley, both of Las Cruces, for appellee.

BRICE, Justice.

This action was brought to determine the interests of the respective parties (formerly husband and wife) in certain real and personal property held in the name of one or the other of them.

From the trial court's elaborate findings, we select the following as the ultimate facts necessary to a decision.

The parties to this suit were married November 5, 1925, and permanently separated April 28, 1944. At the time of of their marriage the appellee owned a farm (thereafter sold for $7000 in excess of a mortgage debt by it secured); crops growing thereon at that time, subsequently sold for $10,000; mortgage notes and accounts aggregating $8,500; a total of about $25,000. The appellant owned no property at that time. No finding discloses that either party was indebted in any sum.

In January 1926 the appellee purchased a 115 acre farm for $18,000; $10,000 of which was paid in cash out of his separate funds and the balance of $8000 was settled by the assumption of notes ($3,000 and $5,000 respectively) secured by mortgages on the purchased property. Immediately after appellee acquired this farm he cleared and levelled it for irrigation, with funds he owned prior to his marriage, and produced crops thereon in 1926 and after. The trial court found that the mortgage debts aggregating $8000 were paid partly out of ‘the rents, issues and profits' of that farm, and the balance with the proceeds of a mortgage note thereby secured on which there was a balance due of $6100 at the time of trial; also he inconsistently found that the $5000 note was ‘afterwards paid from the rents, issues and profits' of the purchased lands.

In 1929 the appellee purchased 9.42 acres of land adjoining this farm with the ‘rents, issues and profits' of the 115 acre farm above referred to.

Thereafter the appellee purchased a 94 acre farm and paid therefor with the ‘rents, issues and profits' derived from the 115 acre farm, with the exception of a $3000 mortgage debt thereon, which he assumed.

In 1935 the appellant, with the acquiescence of appellee, assumed management and control of this farm, and received all rents and proceeds derived from the crops grown thereon, out of which she paid the operating expenses. It was sold for $7000 in 1941, the purchaser assuming the mortgage debt of $3000 and interest, by it secured. Appellee gave to appellant his interest in the $7000 net proceeds derived from this sale, out of which she purchased a home in El Paso, Texas, and the balance of $3800 was deposited to her account in an El Paso bank.

All improvements, alterations and repairs made on the 115 acre farm were paid for by the appellee ‘from the rents, issues and profits' received from it, except its preparation for irrigation.

There was cotton on hand at the time this suit was instituted, produced from this farm, which was subsequently sold for $17,872.04. Of this amount a balance of $4061.69 remained to appellee's credit at a Las Cruces bank at the time of trial. There is no finding regarding appellee's disposition of the balance.

The court's 18th Finding is in the following words: ‘During the period of their marriage, the farms and property of the parties were operated and made to produce through the joint efforts and planning of the parties; that rents, issues and profits from the different properties from time to time were commingled by the parties and handled as their joint property; that the parties made purchases of equipment, farm machinery, furniture, shares of capital stock of companies, and other personal property without apparent attempt to segregate or keep separate their interests in such. In this case, the parties have not traced their separate funds into the personal properties so purchased and acquired, including the furniture in the home, the farm equipment, the 1941 Dodge automobile, the International pick-up truck and certain shares in the Lawrence Walker Cotton Company, etc.’

Each of the parties has assigned error. It is the contention of appellant that she is entitled to a community interest in the 115 acre farm, 12 shares of the capital stock of the Lawrence Walker Cotton Co., the proceeds of the 1943 cotton crop, including cash in bank, all held by the trial court to be the separate property of appellee; and that a certain Dodge automobile held to be community property, she asserts is her separate property. These claims of appellant will be first considered.

The 115 acre farm was purchased by appellee in January after the parties were married in November. No community property had been accummulated at that time. Of the $18,000 consideration paid and contracted to be paid for it, appellee paid $10,000 out of his separate funds and assumed payment of $8000 in mortgage notes secured by the land, so the court finds; and the evidence, though attacked, substantially supports the finding.

That the credit of the appellee belonged to the community was held in Laughlin v. Laughlin, 49 N.M. 20, 155 P.2d 1010; but we also held in that case that property acquired in New Mexico takes its status as community or separate property at the time and by the manner of its acquisition; and if a part of the purchase money is later paid by other funds than those of the owner of the property, whether of the community or an individual spouse, the owner is indebted to the source of such funds in that amount, but such payment does not affect the title of the purchaser.

It is not claimed that the community is entitled to a lien for funds advanced in payment of these mortgage debts, but it is asserted that appellant is an owner of an interest in the land. The greater part of the consideration was paid in cash and the balance was represented by mortgage debts secured by the land, which were assumed by the appellee. His credit, it is true, belonged to the community (Laughlin v. Laughlin, supra), but the trial court could consistently assume that no credit was used in this instance. The mortgage debts were in existence at the time of the purchase, and the value of the land was more than double the assumed debts. The liability of the community was so remote, and the probability of its being called upon to pay the debt so unlikely, that we will not disturb the conclusion of the trial court that the debt assumed was the separate debt of the appellee and so intended to be at the time of purchase. If any part thereof was subsequently paid by the community, or if the land was subsequently improved with...