Union National Bank of Muncie v. Finley

• Citation: 103 N.E. 110,180 Ind. 470
• Decision Date: 21 November 1913
• Docket Number: 21,744
• Parties: The Union National Bank of Muncie v. Finley et al
• Court: Supreme Court of Indiana

103 N.E. 110

180 Ind. 470

The Union National Bank of Muncie v. Finley et al

No. 21,744

Supreme Court of Indiana

November 21, 1913

From Delaware Circuit Court; Joseph G. Leffler, Judge.

Action by The Union National Bank of Muncie against Mary E. Finley and others. From a judgment for plaintiff granting partial relief, the plaintiff appeals.

Affirmed in part, and reversed in part.

Silverburg Bracken & Gray, for appellant.

McClellan & Hensel, for appellees.

OPINION

Morris, J.

This was an action by appellant against Mary E. Finley and her husband, Harry M. Finley, on a promissory note. Affidavits in attachment and garnishment were filed respectively against the Finleys and the John J. Hartley Agency. In the attachment affidavit it was alleged that the Finleys were nonresidents of Indiana. By virtue of the order of attachment the sheriff seized two lots that were owned by the Finleys, as tenants by the entireties, and also certain parcels of real estate of which appellee Mary E. Finley was sole owner. The John J Hartley Agency, garnishee defendant, filed its answer alleging that it had in its possession $ 125 in money belonging to defendants Harry M. Finley and Mary E. Finley his wife. Harry M. Finley filed an answer denying the averments of the complaint and affidavit in attachment, and further defended on the theory that the two lots owned by him and his wife as tenants by the entireties were not subject to levy, under a writ of attachment, and not subject to sale on execution. Mrs. Finley answered, alleging the same facts, and further pleaded coverture and suretyship as a defense to the note. She also alleged that she was a resident householder of this State, and solely owned property with a total value of less than the statutory householder's exemption of $ 600, and filed with her answer a schedule of all her property. Appellant replied to the affirmative answers.

By agreement, the issues relating to the attachment, were tried by the court, and the other matters in controversy were determined by a jury, which returned the following verdict: "We the jury find for the plaintiff against both of the defendants, and fix and assess the amount of plaintiff's recovery against Harry M. Finley in the amount of $ 3,629.65 + $ 200.00 attorney's fees, and against Mary E. Finley in the amount of $ 3,189.75 + $ 200.00". The amount of the note, principal and interest, was $ 7,274. Evidently the jury intended to find in favor of Mrs. Finley, on her defense of suretyship as to a portion of the debt, and against her as to the remainder. It also appears, in addition to the other defects in the verdict, that there was an error in the calculation of interest accrued on the note.

After the return of the verdict, the Finleys, in open court, offered to let judgment be entered against Harry M. Finley in the sum of $ 7,274 and $ 500 attorney's fees additional, and against Mrs. Finley in the sum of $ 4,102.12, which included $ 200 attorney's fees, "the same being a part of the amount of the judgment to be rendered against the defendant Harry M. Finley." Appellant in open court, declined the offer. The court made a general finding in favor of the Finleys, on the attachment issues, and found that the Finleys were residents of this State. Judgment was rendered on the note against Harry M. Finley in the sum of $ 7,774 with interest from date of verdict (May 20, 1910), and against Mrs. Finley in the sum of $ 4,102.12, "which sum is a part of said judgment heretofore rendered against said defendant Harry M. Finley". It was adjudged that the Finleys "have and hold, as free from attachment and execution" the lots owned by them as tenants by the entireties, and that Mrs. Finley was a resident householder of this State and owned property of less value than $ 600, and was entitled to claim the same as exempt from execution. Appellant's motions for a venire de novo, a new trial, and to modify the judgment, were overruled.

Aside from defects in form, in the verdict and judgment, appellant claims that Mrs. Finley is liable for the entire debt evidenced by the note. The note is dated April 12, 1909, and calls for $ 6,819.40. It was executed in renewal of a note dated August 5, 1907, for $ 6,300 which was executed in consideration of the cancelation of a $ 3,000 note, theretofore executed by the Finleys, and a draft for the balance, payable to Mrs. Finley. Mrs. Finley, at the time of the transaction, delivered to appellant her affidavit which recited that the $ 6,300 she was then borrowing was for her separate use. § 7856 Burns 1908, Acts 1903 p. 394. The $ 3,000 note was executed in February, 1907, in consideration of the cancelation of a note for $ 1,750 given for a previous loan to Harry M. Finley, and a new loan of $ 1,250, the proceeds of which were placed to the credit of Harry M. Finley in appellant's bank. At that time Mary E. Finley made an affidavit stating that the entire $ 3,000 loan was for her separate benefit. Copies of these affidavits are set out in appellant's reply to Mary E. Finley's answer alleging coverture and suretyship. Mary E. Finley received no part of the proceeds of the new loan of $ 1,250, and no part of the proceeds of the $ 1,750 note; on the other hand, Harry M. Finley received the entire proceeds of the $ 1,750 note, and these facts were known to appellant. Section 7856 Burns 1908, Acts 1903 p. 394, has no application to a loan made to a married woman, unless the lender shall pay the proceeds to her "in cash, or by check, or draft." Mrs. Finley never received any portion of the consideration of the debt evidenced by the note in suit except the draft of August 5, 1907, and as to the remainder she executed the note as surety, and is not bound thereby. § 7855 Burns 1908, § 5119 R. S. 1881. As the judgment against her included the amount, principal and interest, of the debt represented by the amount of the draft payable to her, there was no error in the amount adjudged against her. The judgment on the note was defective in form. It should have been rendered against both the Finleys in the sum of $ 4,102.12, and against Harry M. Finley in the further sum of the difference between that amount and $ 7,774.

The trial court held that the real estate owned by the Finleys as tenants by entireties is not subject to levy under an order of attachment, in a suit on an obligation of such husband and wife, and not subject to execution under a judgment against both. It is claimed by appellant that this holding was erroneous. The case of Sharpe v. Baker (1911), 51 Ind.App. 547, 96 N.E. 627, involved the same principle here in controversy. In a carefully considered opinion, it was held by the Appellate Court that land held by husband and wife as tenants by entireties is subject to execution under a judgment against husband and wife. On petition to transfer the cause, the holding of the Appellate Court was approved by this court. Here the obligation sued on was executed by the husband and wife and judgment rendered against both, and, under the doctrine declared in Sharpe v. Baker, supra, the land owned by them as tenants by entireties is subject to sale on execution under the judgment; and it must necessarily follow that it is subject to levy under a writ of attachment, where there is statutory ground for such writ, in a suit on a note executed by the husband and wife, for a consideration binding on both.

It is also contended by appellant that the evidence shows that the Finleys were nonresidents of this State, when the attachment proceedings were instituted, and that there is no evidence to support the contrary finding of the trial court. In some particulars, there was a conflict in the evidence on this subject, and consequently only the uncontroverted facts, the evidence most favorable to the Finleys, and such inferences as might be drawn favorable to their contention, can be considered here. Peabody-Alwert Coal Co. v Yandell (1913), 179 Ind. 222, 100 N.E. 758. The facts of such character, are as follows: Harry M. Finley's principal occupation, for thirty years before the trial, was lecturing, under the name of F. M. Donavan, on spiritualism and occultism; they were married about 1898; for some time previous to June 1906, they were bona fide residents of Litchfield, Illinois. At the latter date, they removed to Muncie, Indiana, and brought their household furniture with them, where they lived with Mrs. Finley's mother, in apartments at 115 1/2 West Jackson Street. These apartments were on the second floor of a building, the ground floor of which was occupied by the U.S. Express Company. The building was owned by the Finleys. From June, 1906, to February, 1907, the Finleys were bona fide residents of Muncie, Indiana. Early in 1907, Harry M. Finley was offered a bonus of $ 15,000 by the Commercial Club of Paducah, Kentucky, to come there and establish a bottle factory. The offer was accepted, and in February or March, 1907, Mr. and Mrs. Finley removed from Muncie to Paducah. They did not take any household furniture with them, but lived, while in Paducah in a furnished house leased by them. Mr. Finley erected the bottle factory in the spring and summer of 1907, and received the bonus. The real estate, on which the plant was located, was held in Mr. Finley's name and the manufacturing business was also conducted in his name until January, 1908, when a corporation was formed with a capital stock of $ 75,000, and a deed was made by him to the corporation, in consideration of the transfer to him of $ 60,000 par value, of the capital stock. In the spring of 1908, the Finleys left Paducah, and, during the remainder of the year, 1908, and the year, 1909, Mr. Finley was lecturing in Connecticut and Massachusetts. During that time his wife was...