Morris Inv. Co. v. Skeldon

• Decision Date: 18 March 1948
• Docket Number: No. 30425.,30425.
• Citation: 78 N.E.2d 504,399 Ill. 506
• Parties: MORRIS INV. CO. v. SKELDON et al.
• Court: Illinois Supreme Court

399 Ill. 506

78 N.E.2d 504

MORRIS INV. CO.

v.SKELDON et al.

No. 30425.

Supreme Court of Illinois.

March 18, 1948.

Appeal from Circuit Court, Will County; James V. Bartley, judge.

Suit by Morris Investment Company against Irene M. Skeldon and others to partition realty, wherein defendants cross-complained to have a deed executed by trutee in bankruptcy to plaintiff removed as a cloud on defendant's title. From a decree dismissing complaint, plaintiff appeals.

Decree affirmed.

Jesse Marcus, of Chicago, for appellant.

Donald F. Wise, of Joliet, for appellees.

MURPHY, Chief Justice.

Plaintiff instituted this suit in the circuit court of Will County to partition a certain lot in which it claimed an undivided one-half interest. After hearing evidence, the chancellor found plaintiff had no title or interest in the lot and dismissed the complaint for want of equity. Plaintiff has appealed directly to this court.

On and prior to November 27, 1934, Ole A. Vogen and Irene M. Vogen, husband and wife, held the title as joint tenants and not as tenants in common. On that day they mortgaged it to the Home Owners' Loan Corporation to secure the payment of $1950. Homestead rights were released by the mortgage to the extent of the mortgagee's interest. The Vogens continued to occupy the premises as a home, and in October, 1940, while residing on the premises with his family, Ole A. Vogen filed a voluntary petition in bankruptcy. He scheduled as an asset an undivided one-half interest in the lot, noting therein that it was encumbered to the Home Owners' Loan Corporation to an unpaid balance of approximately $1700, and that it was occupied by the bankrupt as a homestead. The bankruptcy court appointed a trustee and on his petition filed November 8, 1940, appointed three appraisers. Their report, dated November 13, 1940, listed as an asset which they had appraised the undivided one-half interest in the lot in question. They fixed the full value of real estate at $2000, but in the column provided in the form for the listing of the value of the property owned by the bankrupt, they entered the value at $1000. The report contains no reference to the mortgage indebtedness or to any homestead rights of the bankrupt.

In January, 1941, the trustee in bankruptcy filed a petition in the bankruptcy court asking permission to sell all the right, title and interest of the bankrupt in and to an undivided one-half interest in the lot involved in this proceeding. After notice, an order was entered directing the sale and on the day of sale, which was February 7, 1941, the undivided one-half interest was sold to the plaintiff on its bid of $30. A report of sale was approved and the court ordered the trustee to execute and deliver a deed to the plaintiff. The trustee's deed was filed for record within a few days after its delivery.

The Vogens continued in possession of the property during the bankruptcy proceeding and at the time of the entry of the orders and the execution of the deed referred to, but thereafter on July 19, 1943, Irene M. Vogen obtained a divorce. A few days thereafter Ole A. Vogen conveyed to her all his interest in the lot, including a release of the right of homestead. The deed was recorded August 2, 1943. Irene M. Vogen continued to occupy the same as a home for herself and children. In September, 1943, she and Evan Skeldon were married and they continued to reside therein.

Plaintiff claims that it acquired an interest in the property by virtue of the trustee's deed, and that it has title to an undivided one-half interest subject to the one-half of the unpaid balance of the mortgage. Irene M. Skeldon contends that the evidence shows that Ole A. Vogen claimed his homestead exemption rights in the bankruptcy proceeding, that his interest in the property was of a value less than $1000, that he did not waive his rights or consent to a sale of the property disencumbered of his homestead right, and that, therefore, the trustee's deed was ineffective to pass title.

An issue was raised by the pleadings as to whether Ole A. Vogen claimed his homestead rights in the bankruptcy schedule. The chancellor found that such claim had been made and such finding is supported by the facts set forth in the bankrupt's schedule. An issue was also raised as to the value of Ole A. Vogen's interest at the time of the filing of the petition in bankruptcy and at the time of the sale. The chancellor found the same to be of value less than $1000. In addition to the facts shown in the appraisers' report, it appears that on the trial of the present case the parties stipulated that if Stanley Monroe and Walter Steffes were present, they would testify that in their opinion the fair cash value of the property on the date of plaintiff's deed was $2000 to $2210, and that its present value was approximately $5500. The evidence shows that the unpaid balance on the mortgage as of February 7, 1941, was $1453.82. At the time of the hearing in the instant case, it was $1519.50.

Section 1 of the Homestead Exemption Act (Ill.Rev.Stat.1947, chap. 52, par. 1), insofar as material here, is as follows: ‘That every householder having a family, shall be entitled to an estate of homestead, to the extent in value of $1000, in the farm or lot of land and buildings thereon, owned or rightly possessed, by lease or otherwise, and occupied by him or her as a residence.’ Three conditions must exist under this statute in order that an estate of...