Panagopulos v. Manning

• Decision Date: 23 June 1937
• Docket Number: 5815
• Citation: 69 P.2d 614,93 Utah 198
• Court: Utah Supreme Court
• Parties: PANAGOPULOS v. MANNING et ux

69 P.2d 614

93 Utah 198

PANAGOPULOS v. MANNING et ux

No. 5815

Supreme Court of Utah

June 23, 1937

Rehearing Denied October 13, 1937.

Opinion denying rehearing in 93 Utah 215, 72 P.2d 456.

Appeal from District Court, Second District, Weber County; L. A Wade, Judge.

Action by Fawntella Panagopulos against Clarence Manning, also known as Clarence J. Manning, and wife. From a judgment of dismissal, plaintiff appeals.

AFFIRMED.

W Finch Dawson and George W. Latimer, both of Salt Lake City, for appellant.

David J. Wilson, of Ogden, for respondents.

LARSON, Justice. FOLLAND, C. J., and EPHRAIM HANSON, MOFFAT, and WOLFE, JJ., concur.

OPINION

LARSON, Justice.

This is an appeal from a judgment of the district court of Weber county. In October, 1904, the father and mother of defendant Clarence Manning conveyed by deed to Clarence Manning approximately 20 acres of land in Weber county, reserving unto the grantors and each of them a life estate in the property. Since the execution of such deed, neither of the grantors has been in possession of, nor lived upon, said premises, but the grantee, Clarence Manning, and his family have lived upon the land under a verbal lease from year to year between the life tenants and the grantee of the legal title, under the terms of which the defendants (grantees) held exclusive possession and actual occupancy. Prior to 1931, John Manning, one of the life tenants, died. On March 30, 1931, defendant Clarence Manning, while driving an automobile, struck and killed Ray Anderson, a minor son of plaintiff. The following day, Clarence Manning, for the purpose and with the intention of preventing creditors--particularly plaintiff--from obtaining said property, conveyed the same without other consideration to his wife, the defendant Jennie A. Manning. On January 20, 1932, plaintiff herein recovered a judgment against defendant Clarence Manning in the sum of $ 4,631 for the death of said Ray Anderson, and within four months thereafter, defendant Clarence Manning filed in the United States District Court his schedules in bankruptcy, listing among his liabilities the judgment of plaintiff herein, recovered for the death of her minor son, Ray Anderson, and was adjudicated a bankrupt. Manning did not list among his assets the property above referred to and involved in this action. At the first meeting of creditors of the bankrupt, plaintiff appeared by counsel and proved her claim; a trustee in bankruptcy was named, who made application for leave to bring an action to recover to the bankrupt estate the land involved in this action. On hearing before the referee, where plaintiff and defendant, Clarence Manning, both appeared by counsel, the referee set aside the property as exempt to the family of the bankrupt. On application for discharge of the bankrupt, plaintiff, before the court, resisted such discharge upon the grounds that the bankrupt had made false statements in not listing this property among his assets, and had fraudulently transferred it to his wife to defraud his creditors. The United States District Court overruled these objections and entered an order of discharge of the bankrupt on October 24, 1933. Under date of October 10, 1933, Elizabeth Manning, the sole surviving life tenant, quit-claimed to defendant, Jennie Manning, all her interest in the property in controversy. This property was all the real estate owned by defendants, and was of a value less than the statutory exemptions allowable to the Mannings.

This action was instituted to set aside the deed from defendant Clarence Manning to his wife, the defendant Jennie Manning, as fraudulent, and for a decree subjecting the property to the lien of plaintiff's judgment against Clarence Manning. The trial court held that the property was exempt as a homestead; also that plaintiff's judgment was discharged in the bankruptcy proceeding, and dismissed the complaint. Plaintiff appeals.

Three questions are presented on the appeal. (1) Could a homestead right attach to this property while a life estate existed in a third party? (2) Was plaintiff's judgment against defendant Clarence Manning dischargeable in bankruptcy? (3) Did the action of the bankruptcy court in setting aside the property as a homestead extinguish plaintiff's lien? We will consider them in order.

(1) A homestead exempt from forced sale is fixed by the Constitution of the state (article 22, § 1) and by the statutes (title 38, R. S. Utah 1933). This right has by this court been defined in a number of cases as an absolute right which neither the Legislature nor the courts can infringe, and that laws relating to the exemption rights to a homestead should be liberally construed. Our statute differs from those of most states. Ours makes no requirement that the property be actually "used as a home," or must be "owned in fee," or such conditions generally found in homestead exemption statutes. Our statute merely provides that a homestead consisting of lands, appurtenances, and improvements, which lands may be in one or more localities, not exceeding specified values, shall be exempt from judgment lien and from execution or forced sale, except for taxes and mortgages thereon. Section 38-0-1, R. S. 1933. This homestead may be claimed by the husband or wife, and from the property of either. Sections 38-0-6, 38-0-8 and 38-0-9, R. S. 1933. It is not necessary to assert the claim until after levy of execution, and the proceeds from sale of homestead property are exempt.

The court has repeatedly held that the homestead right is founded on a public policy, deemed by the organic law itself as fundamental to the making of good citizens in a free government, and is one of the foundation stones upon which stability of government such as ours rests. We have repeatedly held that this statute is remedial and to accomplish its beneficent purpose should be broadly construed. Kimball v. Salisbury, 17 Utah 381, 53 P. 1037; Hansen v. Mauss, 40 Utah 361, 121 P. 605; Payson Exch. Sav. Bank v. Tietjen, 63 Utah 321, 225 P. 598; Utah Builders' Supply Co. v. Gardner, 86 Utah 250, 39 P.2d 327, 329, 103 A. L. R. 928; Id., 86 Utah 257, 42 P.2d 989, 990 103 A. L. R. 932. In Sec. 1 of Thompson on Homestead and Exemptions, the author has expressed his views on the homestead exemption law in the following language:

"The wise and benevolent policy which dictated the enactment of these laws has been the theme of considerable forensic and judicial eloquence. The late Senator Benton, advocating in the United States Senate the adoption of a general homestead policy, said: 'Tenantry is unfavorable to freedom. It lays the foundation for separate orders in society, anihilates the love of country, and weakens the spirit of independence. The tenant has, in fact, no country, no hearth, no domestic altar, no household god. The freeholder, on the contrary, is the natural supporter of a free government; and it should be the policy of republics to multiply their freeholders, as it is the policy of monarchies to multiply their tenants.' 'There is,' said Tarbell, J., in a case in Mississippi, 'unquestionably no greater incentive to virtue, industry, and love of country than a permanent "home," around which gather the affections of the family, and to which the members fondly turn, however widely they may become dispersed.' * * *

"And we find scattered through the cases which involve the construction of these laws such expressions as these: 'This beneficent provision for the protection and maintenance of the wife and children against the neglect and improvidence of the father and husband.' 'That the homestead exemption was founded upon principles of the soundest policy cannot be questioned. Its design was, not only to protect citizens and their families from the miseries and dangers of destitution, but also to cherish and support in the bosoms of individuals those feelings of sublime independence which are essential to the maintenance of free institutions. These are noble objects.' 'It was an enlightened public policy, looking to the general welfare as well as to that of the individual citizen, which dictated the passage of the homestead act; and the obvious intent of the act is to secure to every householder or head of a family a home, a place of residence, which he may improve and make comfortable, and where the family may be sheltered and live beyond the reach of those financial misfortunes which even the most prudent and sagacious cannot always avoid.'"

Our statute, being so designed, must be construed and interpreted to give effect to the purposes and objects the framers of the Constitution and the Legislature had in mind in the enactments. The homestead, in addition to the noble and sentimental reasons set forth by Thompson, is to secure to the family two practical necessities--shelter and support. These things, for the safeguarding of the family unit, the health of the people, and the rearing of good citizens, have been deemed of more importance, of higher worth, than the matter of financial relations between debtor and creditor. The state having declared and established such public policy all business relationships are made and entered into with knowledge thereof and in reliance thereon. To assure support to the family, it is provided that the homestead may be in several tracts, that it need not be a dwelling or occupied as a home, and need not all be in one county. If it is used so as to contribute to the support or maintenance of the family, or its sense of security, it may be claimed as a homestead. But the homestead exemption is also established to provide for the family the element of shelter--shelter from the elements, shelter from the public, shelter from disturbance and annoyance from the outside...