Trimble's Estate, In re

• Decision Date: 19 February 1953
• Docket Number: No. 5522,5522
• Citation: 57 N.M. 51,1953 NMSC 14,253 P.2d 805
• Parties: In re TRIMBLE'S ESTATE. TRIMBLE v. ST. JOSEPH'S HOSPITAL et al.
• Court: New Mexico Supreme Court

Page 805

253 P.2d 805

57 N.M. 51

In re TRIMBLE'S ESTATE TRIMBLE v. ST. JOSEPH'S HOSPITAL et al.

No. 5522.

Supreme Court of New Mexico.

Feb. 19, 1953.

G. W. R. Hoy, Farmington, for appellant.

Keleher & McLeod and J. C. Ryan, Alburquerque, for appellee St. Joseph's Hospital.

Charles M. Tansey, Jr., Farmington, for appellee Farmington Gen. Hospital and Dr. Eugene N. Davis.

COORS, Justice.

This is an appeal from an order of the District Court of San Juan County sitting in probate in the estate of Walter Lowell Trimble, intestate.

Certain creditors' claims were filed against the estate, all of which were approved by the administratrix (the widow of decedent) and which amounted to approximately $1,700 for hospital charges, medical service and burial expense and another $500 for personal notes of the decedent outstanding at his death.

After said claims were filed and approved, the administratrix called for a determination by the court of the question whether the real estate involved in this appeal was subject to their payment. From a ruling the property was community property of the decedent and his widow, and therefore subject to payment of claims against the estate, she appeals.

The background of the controversy is, briefly, as follows: In her original petition for probate of the estate, the administratrix stated:

'5. That the deceased and petitioner herein, wife of the deceased, owned real property situated in the town of Farmington, New Mexico, of the approximate value of $12,500, subject to incumbrances. * * *'

Subsequent to the filing of this petition, the administratrix learned the property in question had in fact been deeded to the decedent and herself in joint tenancy. When the inventory of the estate was filed the administratrix and widow made the following statement:

'That the abstract to said property had been deposited with the Equitable Life Insurance Company in connection with a loan on said real property: that the said administratrix was not aware that said property was held in joint tenancy until the said abstract was obtained from said insurance company together with a deed to said property, for which reason your petitioner herein was of the impression that said property belonged entirely to the estate of the said deceased as community property of the said Walter Lowell Trimble and your undersigned petitioner as administratrix.'

Title to the property had been conveyed by two deeds which described the grantees as husband and wife and were in the form of joint tenancy deeds. Their granting clauses were identical, and provided:

'Not as tenants in common, but in joint tenancy, the survivor of them, their assigns, and the heirs and assigns of such survivor.'

It was stipulated that the properties were purchased with community funds. There is no suggestion the deeds were made in an attempt to defeat the rights of creditors.

The four assignments of error argued and presented in appellant's brief-in-chief are inter-dependent and raise the question whether it was error for the trial court to find the property in question was community property.

The pivotal question under these facts is whether transmutation of community property (i. e., purchase funds) into the common law estate of joint tenancy has been effected.

Although it is unnecessary to re-examine at length the historical background of our community property system, it is important to keep in mind certain dominant principles of that system.

In New Mexico, property which is owned by either spouse before marriage, or acquired thereafter by gift, bequest, descent or devise, and the rents, issue and profits thereof, is his or her separate property. Secs. 65-304, 65-305, N.M.S.A.1941 Comp. 'All other property acquired after marriage by either husband or wife, or both, is community property * * *.' Sec. 65-401, N.M.S.A.1941 Comp., as amended, Laws 1947, ch. 191, sec. 1. This last named section establishes certain presumptions where the conveyance is to the wife alone, or to her and her husband, to which reference will be made hereafter, but, the mainstay of our community property system is contained in the first sentence of Sec. 65-401 quoted just above.

Another basic principle of community property as stated in de Funiak, Principles of Community Property, Sec. 77, p. 203, is as follows:

'There was no question in the Spanish law, of course, that upon the acquisition or purchase of other property through the use of community property, the property so acquired or purchased was also community property; the same was true of property acquired or purchased by a husband or wife through the use of money of the husband or wife, where such money was earned or gained during the marriage since it constituted community property.'

The same section at a later point, p. 205, continues:

'The rule is also usually correctly followed by the courts of our community property states that property acquired during marriage through the use of community property also is community property.'

Superimposed upon these doctrines is the declaration of Sec. 65-206, N.M.S.A.1941 Comp., that 'Either husband or wife may enter into any engagement or transaction with the other, or with any other person respecting property, which either might, if unmarried; subject, in transactions between themselves, to the general rules of common law which control the actions of persons occupying confidential relations with each other.'

Growing side by side, and in many instances directly infused in our community property system are certain estates of ownership developed by the common law. N.M.S.A.1941 Comp. Sec. 65-302 provides:

'Methods for holding property.--Husband and wife may hold property as joint tenants, tenants in common, or as community property.'

The Circuit Court of Appeals in Hernandez v. Becker, 10 Cir., 1931, 54 F.2d 542, 547, a case involving the property laws of New Mexico and the Federal Estate Tax, declared with regard to joint tenancies:

'A joint tenancy arises where two or more persons have any subject of property jointly in which there is a unity of interest, unity of title, unity of time, and unity of possession. 2 Bl.Com. 180. * * *

'The chief incident of such an estate is the right of survivorship by virtue of which, upon the death of one joint tenant, his interest does not pass to his heirs or representatives, but the entire tenancy remains to the surviving cotenants, and the last surviving tenant takes the whole. 2 Bl.Com. 183, 184; * * *. The survivor does not take the moiety of the other tenant from him or as his successor, but takes it under and by virtue of the conveyance or instrument by which the joint tenancy was created. * * *'

There remains only one other legislative pronouncement to guide us in determining the present issue, Sec. 65-401, N.M.S.A.1941 Comp., so far as pertinent, which provided, before amendment, as follows:

'All other property acquired after marriage by either husband or wife, or both, is community property; but whenever any property is conveyed to a married woman by an instrument in writing the presumption is that title is thereby vested in her as her separate property. And if the conveyance be to such married woman and to her husband, or to her and any other person, the presumption is that the married woman takes the part conveyed to her, as tenant in common unless a different intention is expressed in the instrument, and the presumption in this section mentioned, is conclusive in favor of a purchaser or encumbrancer in good faith and for valuable consideration. * * *'

Although this section was amended by Laws 1947, ch. 191, sec. 1, reference is made to the earlier statute because the property in question in this case was acquired before the 1947 amendment.

While the question of presumptions is not raised specifically by the appellant, we believe consideration of this problem is implicit in the issue presented. California has a statute, Sec. 164, Cal.Civil Code 1941, which for present purposes is substantially identical with our Sec. 65-401, supra. In the case of Siberell v. Siberell, 1932, 214 Cal. 767, 7 P.2d 1003, 1005, the facts raised the question of whether the presumption of a gift to the wife when property was conveyed to her and her husband as tenants in common was paralleled by a similar presumption where the husband and wife took title to the property as joint tenants. In this divorce action the wife claimed to own half of certain property as a joint tenant, and an additional half interest in the remaining half of the property by virtue of her membership in the community. The court ruled there was no presumption of gift in the latter instance. The rationale of this decision is that the estates of joint tenancy and community ownership are incompatible by their very nature, and, further, that the statute on its face excludes any idea of a presumption of gift attaching to a deed in joint tenancy by the phrase "unless a different intention is expressed in the instrument."

In August v. Tillian, 1947, 51 N.M. 74, 178 P.2d 590, in construing said sec. 65-401 prior to its amendment, we recognized that a presumption of gift to the wife did exist where property was conveyed to husband and wife as tenants in common, with the result the wife owned one-half as her separate property, and owned an additional quarter interest in the property by virtue of the fact the husband's interest was community property. However, we are in agreement with the California court in the Siberell case that no similar presumption exists under sec. 65-401 prior to amendment where a deed is executed to husband and wife during marriage as joint tenants.

It is the contention of the appellant that although she was at all times during the life of her husband, and, indeed, even until after the commencement of probate proceedings of his estate, ignorant that the deeds to the property in question were deeds in joint tenancy, but was under the...