Case ID: ohio-st_55/html/0138-01.html
Source: Caselaw Access Project
Author: {"author": "Shauck, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Aultman, Miller & Co. et al. v. Wilson, Assignee.
    
      Homestead exemptions — Husband and wife co-partners~-^-Partnership assets not subject to allowance in lieu of homestead exemptions.
    
    1. Husband and wife who are co-partners in trade are notentitled either jointly or severally to an allowance in lieu of homestead out of-the assets of the co-partnership in the hands of an assignee for the benefit of creditors, until the debts of the co-partnership have been paid in full.
    2. When the right to such allowance is disputed, it is the duty of the assignee to await an order of the probate court in the premises, and without such order he makes the allowance at his peril
    (Decided October 20, 1896.)
    Error to the Circuit Court of Columbiana County.
    Exceptions of the plaintiffs in error to the final account of theassignee and to the inventory were determined in the probate court against the assignee, who tookan appeal tothe court of common pleas. The exceptions challenged the right of the assignors to an allowance in lieu of homestead which had been made to them.
    In the court of common pleas the findings of fact and conclusions of law were stated separately as follows i
    
    “And the court finds: That the said M. A. & C. S. Landis, at the time thejT made their deed of assignment, November 25th, 1890, were partners and husband and wife, living together ; that they were residents of the state of Ohio, and were not, nor was either of them, the owner of a homestead; that they demanded, out of the property assigned, which was partnership propertly solely, $500:00 worth thereof, in lieu of a homestead, and, having-selected the same, the appraisers, appointed by the probate court, under said assignment, on making the appraisement, set the same off, and the same was thereupon, and before any exceptions were filed to the inventory, taken into the possession and control of the said assignors and by them consumed and disposed of; that on the 31st day of December, 1890, the inventory and appraisement was filed in the probate court; said inventory set out the specific articles and their value which, at the request of the assignors as husband and wife, the appraisers had so set off to them, and stated that the same had been so set off. At the time said property was so set off to the assignors, in lieu of a homestead, the assignee took counsel of a reputable member of the bar of Columbiana county, learned in the law, who was at the same timé the attorney for said assignors, who advised him that under the law of Ohio the assignors were entitled to the property so set off, and about the. same time the attorney for one of the creditors said to the assignee that the assignors were not entitled to such exemption. The final account of the assignee was filed in the probate court, July 30th, 1891. The first exceptions to the inventory were filed September 16th, 1891.
    “On consideration of the above recited facts, the court finds, as its conclusions of law thereon, that the goods so set off to said assignors in lieu of a homestead ought not to have been so set off to them ; that they were not entitled to them out of the partnership property; that the assignee Should be charged with the amount thereof, and that the same, to-wit, the sum of $500.00 should, and the same is hereby ordered to be, added to the amount hereinbefore found as chargeable against said assignee, to which finding and conclusion of law, charging said assignee, with said amount so setoff to the assignors in lieu of a homestead, the said assignee excepts.”
    On petition in error the circuit court found that the court of common pleas erred in its conclusion of law from the facts found, reversed its judgment and rendered a final judgment in favor of the'assignee upon the facts so found.
    This petition in error is prosecuted for the reversal of the judgment of the circuit court and the affirmance of that of the common pleas.
    
      W. H. Spence and A. H. Clark, for plaintiffs in error.
    We contend no such right attaches under the law, and that the assignee erred in allowing the claim for exemption, and that he should be required to make good to the creditors the $500.00 worth of personal property by him so set off to the assignors, or either of them.
    It is claimed, as we understand it, that the statute has been amended so as to allow “husband and wife” to demand and have set off the exemption allowed by law in lieu of a homestead, even though they are business partners, and the property be partnership property.
    The question is this: Were the assignors jointly or separately entitled to the set off allowed by the assignee? We think clearly not. They were both partners and husband and wife. Even if they join, as husband and wife, in the demand (we contend they could not join but that one or the other should have made the demand) they could not claim such right as partners. The right is personal, strictly individual, to be asserted or not at the will of the person in whose favor the right exists. It is not a joint privilege, but is a personal privilege and individual privilege; Conley v. Chilcote, 25 Ohio St., 324; 26 Ohio St., 317. Bates on Partnership section 1131-1133. Parsons on Partnership as referred to by the court in case cited. Also Pond v. Kimball 101 Mass. 105; Love v. Blair, 72 Ind. 281; Guptil v. McFee, 9 Kan. 30; Kingsley v. Kingsley, 39 Cal. 665; State ex rel v. Spencer, 64 Mo. 355; Bonselly. Comley 44 Pa. St. 442; In re Blodgett, 10 Natl. Bank, Reg. 145; Rhodes v. Williams, 12 Nev. 20 ; Spiro v. Paxton (Tenn.) 31 Am. Rep. 630; 7 Neb. 134; same case, 29 Am. Rep. 380; 55 Ala. 305; found also in 28. Am. Rep. 723; This last case overrules, Howard v. Jones, 50 Ala., 67; Dinklin v. Kimball, 50 Ala., 251; and Gevanie et al v. First National Bank, which are the same parties as in the last above cited case, 51 Ala., 177.
    The policy of the law is to exempt such property as is used by the party for the benefit of himself and family and their convenience, but does not include property owned by a firm and used in their business for profit. On this fund, property and effects, the trust for payment of partnership debts is primary and paramount.
    But was there a partnership in the case before the court? We think there was and to al] intents and purposes just like all copartnerships. They are husband and wife. We concede this, but they were partners, doing business in the firm name of M. A. & O. S. Landis, Section 3112, Revised Statutes.
    It seems clear that the wife in this state is clothed with all the capacity to contract that any other person is.
    
      The law recognizes her right and ability to enter into partnerships. Her power to do business has been greatly increased by the law, and so has her responsibility. See 81 Ohio L., 65, 209; 84 Ohio L., 132.
    Being a feme sole, as it were, in her trade and transactions, with capacity to employ agents general or special, and may so employ her husband, there would seem to be no reason why she could not form a partnership with her husband; and many cases hold, others assume she can. In re Kincaid, 3 Bliss U. S., 405; Camden v. Miller, 29 Cal., 564; Francis v. Dichel, 68 Ga., 255; Preusser v. Henshaw, 49 Iowa, 41; Plummer v. Lord, 5 Allen (Mass.), 460; Parshall v. Fisher, 43 Mich., 329; Newman v. Morris, 52 Miss., 402; Bitter v. Rathman, 61 N. Y., 512 and 44 Ohio St., 192.
    It seems clear, therefore, that Mrs. Landis had the capacity to enter into partnership with her husband, both in equality and law. Her husband had the same right. There was a partnership in law in fact, and no exemption can be allowed to either or both of them. Payne v. Thompson, 44 Ohio St., 192, and cases there cited.
    
      II. B. Hill and Billingsley, laylor 06 Glm% for defendant in error.
    The main question in this case is whether or not the assignors were entitled to an exemption in lieu of a homestead out of the property assigned. The probate and common pleas courts held that they were not, but the circuit court held that they were entitled to such exemption.
    It is the well settled rule in this state that the exemption statutes should be liberally construed in favor of the' claimant. (Sears et al. v. Hanks et 
      
      al., 14 Ohio St., 298; McConville v. Lee, 31 Ohio St., 447. Sections 5441, 6348, Revised Statutes.)
    Conceding that the decision inthecaseof Gaylord v. Imhoff, 26 Ohio St., 317, is right, or that it must stand, whether right or wrong, we claim that is wholly inapplicable to the case at bar. No prin ciple of law is better settled in Ohio, than that the syllabus or decision of a case must be read and understood in connection with the facts of the case. Witte v. Lockwood, 39 Ohio St., 145.
    In this case we have a state of facts entirely different from the facts in the Gaylord case. We have here an unusual partnership, a partnership between husband and wife. By becoming partners, they had made all their property of every kind, liable for the payment of the partnership debts, subject only to their right, if they had such right, to hold the exemptions allowed by law in other cases.
    If, however, they owned all their property in partnership, they would not, upon the theory advanced by counsel for the plaintiff in error, be entitled to hold any property of any kind, exempt from execution, not even the bibles, hymn books, psalm books, testaments, etc. Mortley v. Flanagan, 38 Ohio St., 401; Hill v. Myers, 46 Ohio St., 183.
    The set-off was made by the appraisers, and the assignee had no control over them in that matter. The appraisers are appointed by the court, and not by the assignee. They act under oath, and the statute makes it their duty where property is exempt, to “set the same off in the same way that appraisers of property levied on or attached, are required to do; and if for any reason this set-off is then omitted, the court may at any time thereafter, and before sale, order the same to be done by the appraisers.” Revised Statutes, 6348.
   Shauck, J.

However conflicting the decisions elsewhere may be, it is settled in this state that “the members of an insolvent Arm are not entitled to the statutory exemptions out of partnership property after it has been seized in execution by partnership creditors, notwithstanding all the members join in demanding the exemptions.” Gaylord et al. v. Imhoff & Co., 26 Ohio St., 317. A.nd it is manifest that the vesting of the partnership property in an assignee for the benefit of creditors is the legal equivalent of its seizure in execution.

It is said, however, that a different rule should apply here because the relation of husband and wife existed between the members of the insolvent firm, the ownership of the property and the right to demand the exemption being alike joint. Section 5441, Revised Statutes, provides that “husband and wife living together, a widower living with an unmarried daughter or minor son, every widow and every unmarried female having in good faith the care, maintenance and custody of any minor child or children of a deceased relative, residents of Ohio, and not the owner of a homestead, may in lieu thereof hold exempt from levy and sale real or personal property to be selected by such person, etc.” Husband and wife living together by the terms of this section constitute a family for whose'benefit the exemption is allowed, as do widowers, widows and unmarried women, under the conditions named. But there is no reason to suppose that the general assembly was undertaking to impart a joint character to the right. Although a husband lives with his wife, he is the person upon whom is conferred the right of selection. The allowance provided for in this section is in lieu of the family homestead, which may be held exempt from sale under the provisions of section 5435, Revised Statutes, where husband and wife, living together, are also constituted a family for whose use the exemption is made; yet the right to demand.it is primarily that of the husband alone, the wife having no right to make the demand unless the husband fail or refuse to make it.

Nor is there anything in the legislation upon this subject showing an intention on the part of the general assembly to change the settled and familiar rule that homestead rights attach only to the individual property of the debtor, and that partnership property must, to the extent necessary, be devoted to the payment of partnership debts.

The facts found by the trial court show that when the goods were set off to the assignors upon their demand their right to the exemption was denied by counsel representing some of the creditors of the firm. In that situation it was the duty of the assignee to hold the property subject to the order of the probate court, which alone had original jurisdiction to determine the question of their right. In delivering the property without such order he acted at his peril, and the advice of counsel will not shield him from the consequences of a mistaken course.

Judgment of the circuit court reversed, and that of the common pleas affirmed.