Title: LURIE v. BLACKWELL

State: wyoming

Issuer: Wyoming Supreme Court

Document:

LURIE v. BLACKWELL2002 WY 11051 P.3d 846Case Number: 01-212Decided: 07/18/2002

APRIL TERM, A.D. 2002

                                                                                                                                   

NANCY 
LURIE, 

Appellant(Intervenor/Third 
Party Claimant),

v.

ROBERT 
J. BLACKWELL, in his capacity

as 
Liquidating Trustee of the Popkin & Stern

Liquidating 
Trust, 

Appellee(Plaintiff).

Representing 
Appellant: 

            
Stephen L. Simonton of Simonton and Simonton, Cody, Wyoming. 

Representing 
Appellee: 

            
Colin M. Simpson of Simpson, Kepler & Edwards, LLC, the Cody, Wyoming 
Division of Burg, Simpson, Eldredge, Hersch and Jardine, P.C., Cody, 
Wyoming.

Before 
HILL, C.J., and GOLDEN, LEHMAN,* KITE, and 
VOIGT, JJ. 

*  Chief Justice at time of expedited 
conference.
  

            
VOIGT, Justice. 

[¶1]      In 1978, Ronald 
U. Lurie and Nancy Lurie, husband and wife, of St. Louis, Missouri, purchased a 
bronze sculpture from a Missouri art dealer.  At some point, the Luries sent the 
sculpture to a Cody, Wyoming, studio "to be sold," and the Luries later moved to 
Montana.  In 2001, Robert Blackwell, 
a Missouri bankruptcy trustee, sought to execute his Missouri bankruptcy 
judgment against the sculpture in Wyoming, the judgment having been entered only 
against Ronald U. Lurie.  Nancy 
Lurie sought to quash the execution, claiming that title to the sculpture was 
held as a tenancy by the entirety and therefore exempt from execution to satisfy 
a judgment entered solely against her husband.  The district court ruled in favor of 
Robert Blackwell.  We 
reverse.

ISSUES

[¶2]      Nancy Lurie, as 
appellant, phrases the issues as follows:

1.         
Does Wyoming prohibit tenancies-by-the-entirety for the kinds of tangible 
personal property which may be owned without recorded documents of 
title?

2.         
If there is a conflict between Wyoming and Missouri law on the 
recognition of tenancies by the entirety, should not Wyoming continue to follow 
the principle that the owners' interest is determined by the law of the state of 
the owner's domicile at the time the property was acquired, absent contrary 
dealings in the property in this state by the owners?

3.         
If not, does the third party non-debtor owner have standing to object to 
improper issuance of a writ of execution?

Robert 
Blackwell, as appellee, essentially frames his arguments in the context of the 
issues raised by Nancy Lurie.

FACTS

[¶3]      Ronald U. Lurie 
and Nancy Lurie are husband and wife, and were so in 1978.  In September 1978, a St. Louis, 
Missouri, art dealer sold the Luries "Lack of Slack," a bronze sculpture by 
Harry Jackson, for $6,500.00.  The 
seller's affidavit states that he sold the sculpture to "Ron and Nancy Lurie," 
and an accompanying bill of sale refers to the buyers as "Mr. & Mrs. Ron 
Lurie" with a St. Louis, Missouri, address.  There is some indication from the 
information and addresses contained in the record that the Luries later moved to 
Montana, where they presently reside.  
In 1994, the Luries sent the sculpture to the Harry Jackson Studio in 
Cody, Wyoming, "to have it sold," and the record does not indicate any intent by 
the Luries for the sculpture to remain in Wyoming on a more permanent 
basis.  Nancy Lurie states that she 
has not "conveyed, waived or otherwise conceded her ownership interest in the 
[sculpture], nor has there been any agreement conveying, waiving or terminating 
the ownership in tenancy by the entirety."

[¶4]      In April 1995, a 
judgment was recorded in the Fifth Judicial District Court of Park County, 
Wyoming.  The judgment, arising from 
a Missouri bankruptcy proceeding, had been entered in favor of Robert Blackwell, 
the bankruptcy trustee, against Ronald U. Lurie for $1,121,743.00, plus 
interest.  On March 22, 2001, a Writ 
of Execution issued from the Wyoming district court, and the Park County 
Sheriff's office subsequently seized the "Lack of Slack" sculpture at the Harry 
Jackson Studio in Cody.  As of May 
14, 2001, the referenced judgment remained unsatisfied in the amount of 
$745,275.78, which judgment continues to accrue interest.

[¶5]      Nancy Lurie 
petitioned to intervene as a third-party claimant and quash the Writ of 
Execution, essentially arguing that Robert Blackwell could not execute the 
judgment against the sculpture in Wyoming because Nancy Lurie and Ronald U. 
Lurie held title to the sculpture as tenants by the entirety.  She also attacked the finality of the 
recorded judgment.  Robert Blackwell 
countered that Nancy Lurie had no standing to attack the sufficiency of the 
recorded judgment, that the Luries were now residents of Montana, which does not 
recognize tenancies by the entirety, and that in the alternative, the record is 
insufficient to overcome Wyoming law's presumption against tenancies by the 
entirety.  Neither party asserts 
that the conveyance at issue in this case implicates the Uniform Commercial 
Code.

[¶6]      After a hearing 
on Nancy Lurie's petition, the district court found that (1) Nancy Lurie did not 
have standing to question the sufficiency of the recorded judgment; (2) Montana 
does not recognize tenancies by the entirety; (3) had the original transaction 
occurred in Wyoming, the Luries "would not be able to qualify their purchase of 
this property as a tenancy by the entireties;" and (4) pursuant to the 
Restatement (Second) of Conflict of Laws § 259, the 
interests of a third-party creditor in marital personal property are determined 
using the law of the state where the personal property was located "when the 
interest is claimed to have been acquired," and Wyoming law applies because the 
sculpture was in Wyoming at the time the judgment was obtained and when the 
instant action was commenced.  The 
district court concluded:

To grant 
[Nancy Lurie's] petition would be to give greater protection than Wyoming 
residents enjoy to a non-resident who bought property in another state and who 
cannot obtain this protection under the laws of the state where she now 
resides.  I am not persuaded that 
such a result would be in the interests of the State of 
Wyoming.

Nancy 
Lurie requested that the district court reconsider its ruling in light of 
further information regarding the referenced Restatement section.  The district court denied this request, 
and Nancy Lurie filed a timely appeal from the order denying her verified 
petition to quash the Writ of Execution.

STANDARD 
OF REVIEW

[¶7]      The facts 
contained in the record are essentially undisputed; this appeal presents an 
issue of law which we review de novo, without affording deference to the 
district court's decision.  
Worcester v. State, 2001 WY 82, ¶ 13, 30 P.3d 47, 52 (Wyo. 
2001); 
Board of County Com'rs of County of Platte v. State ex rel. Yeadon, 971 P.2d 129, 131 (Wyo. 1998).

DISCUSSION

[¶8]      Given the 
particular circumstances of this case, wherein it is undisputed that the sale of 
the "Lack of Slack" sculpture occurred in Missouri (the record does not indicate 
that the sculpture was located anywhere but Missouri at the time the Luries 
acquired an interest in it) and that the Luries were domiciled in Missouri at 
the time they purchased the sculpture, we look to Missouri law to determine the 
effect of the conveyance of an interest in the sculpture to the Luries.  Succinctly stated, the "nature of 
interests conveyed" in personal property is frequently "determined by the law of 
the state where the chattel is situated at the time of the conveyance," and 
"title to personal property acquired under the law of one state where the 
chattel is situated will be recognized in another state into which the chattel 
is taken."  16 Am.Jur.2d Conflict 
of Laws §§ 55, 56 (1998).  See, e.g., Pruitt Truck & 
Implement Co. v. Ferguson, 216 Ark. 848, 227 S.W.2d 944, 945 
(1950).

[¶9]      Although we need 
not expressly adopt the applicable Restatement sections, we note that this 
approach appears to be consistent with the Restatement (Second) of Conflict of 
Laws §§ 244, 247 (1971), which 
sections provide:

§ 
244.             
Validity and Effect of Conveyance of Interest in 
Chattel

(1)       The 
validity and effect of a conveyance of an interest in a chattel as between the 
parties to the conveyance are determined by the local law of the state which, 
with respect to the particular issue, has the most significant relationship to 
the parties, the chattel and the conveyance under the principles stated in § 
6.[1]

(2)       In the 
absence of an effective choice of law by the parties, greater weight will 
usually be given to the location of the chattel, or group of chattels, at 
the time of the conveyance than to any other contact in determining the 
state of the applicable law.

§ 
247.  Moving Chattel into Another 
State:  Effect on 
Title

Interests 
in a chattel are not affected by the mere removal of the chattel to another 
state.  Such interests, however, may 
be affected by dealings with the chattel in the other 
state.

(Emphasis 
added.)  Indeed, Restatement 
(Second) of Conflict of Laws, supra, § 247 cmt. a states:

a.         
Rationale.  Commercial convenience and the needs of 
international and interstate relations alike require that interests in a chattel 
should not be affected simply by its removal from one state to another.  An interest having once been acquired by 
the local law of the state where the chattel was at the time the interest was 
acquired will be recognized by a state into which the chattel is subsequently 
taken.  This is so even though no 
such interest would have been acquired in the latter state if the chattel had 
been there at the time of the conveyance or other transaction.  Conversely, no interest is acquired in a 
chattel upon its removal to a second state merely because such an interest would 
have arisen under the local law of the second state if a particular transaction 
which occurred prior to the chattel's removal to the state had taken place after 
the chattel had been removed there.

Illustration:

1.         
A conveys to B a chattel which is at the time in state X.  A and B are both domiciled in X and X is 
the state of the applicable law under the rule of § 244.  By the local law of X, B became absolute 
owner of the chattel.  B 
subsequently takes the chattel to state Y under whose local law the conveyance 
would have given B only a security interest in the chattel.  The mere removal of the chattel to Y 
does not affect B's interest in the chattel.[2]

[¶10]   This Court has looked to another 
state's law in evaluating the effect of a conveyance (or lack thereof) of 
personal property between the parties to that conveyance in relation to a third 
party's claimed interest in the property, although in a slightly different 
context.  For example, in 
Studebaker Bros. Co. of Utah v. Mau, 13 Wyo. 358, 80 P. 151, 152-53 
(1905), the 
seller, a Utah corporation, entered into a conditional sales contract in Utah 
for the sale of personal property situate in Utah to the buyers, also residents 
of Utah, wherein title to the personal property remained in the seller until the 
buyer paid for the property.  At 
some point, one of the buyers (without the seller's consent) removed the 
personal property to Wyoming, where he sold it to another individual.  Id. at 152.  Utah law provided that conditional sales 
contracts were valid between the parties and as to subsequent bona fide 
purchasers without first having to be recorded.  Id. at 154.  Wyoming law provided that conditional 
sales were invalid as against subsequent bona fide purchasers without notice, 
unless the contract was recorded in the county where the property was 
situated.  Id.  In recognizing the interest of the Utah 
corporation in the personal property as against the third-party purchaser, this 
Court stated that "the validity and effect of contracts relating to personal 
property are to be determined by the laws of the state or country where they are 
made, and, as a matter of comity, they will, if valid there, be enforced in 
another state or country, although not executed or recorded according to the 
laws of the latter;" in other words, that

where, 
as in this case, a conditional sale of personal property is made in one state 
between parties residing in that state, and where the property is then situated 
and delivered, and without any agreement or intention that the property is to be 
removed to another state, and such contract is valid, although not filed or 
recorded, in the state where made, against bona fide purchasers from the 
conditional vendee, and the conditional vendee, without the knowledge or consent 
of the vendor, removes the property to another state, and there sells it to a 
bona fide purchaser, such purchaser acquires only such rights in the property as 
the conditional vendee had therein; and that the conditional vendor can recover 
the property from such purchaser notwithstanding the fact that the conditional 
sale would have been invalid for want of filing or record under the laws of the 
state to which the property was removed and where it was sought to be 
recovered.

Id. at 
154.  On rehearing, this Court found 
that recognizing the valid interest created in Utah would not be contrary to 
Wyoming law or policy, stating also that

"[a]pplying 
by analogy the principles that have been applied to chattel mortgages, it would 
seem that the validity and effect of the reservation of title in the contract of 
sale of personal property should be determined by the lex loci contractus, 
rather than the lex situs, not only when the question arises between the 
immediate parties, but also when it arises between the vendor and a subsequent 
purchaser from or creditors of the vendee, so far as the rights of such 
purchaser or creditor depend upon the original validity and effect of the 
reservation itself.  But, however 
that may be, it is clear that, when the contract is made in the state in which 
the property is then located, the question as to the original validity and 
effect of the reservation is to be determined by the law of that state, 
notwithstanding the subsequent removal of the property to another 
state."

Studebaker 
Bros. Co. of Utah v. Mau, 14 
Wyo. 68, 82 P. 2, 5 (1905) (quoting Wharton on the Conflict 
of Laws § 355(b)).

[¶11]   Robert Blackwell essentially argues 
that the principles stated in Restatement (Second) of Conflict of Laws, 
supra, § 247 and 16 Am.Jur.2d Conflict of Laws, 
supra, § 56, are 
inapplicable because the Luries are no longer domiciled in Missouri, and the 
substantive law of Montana (the Luries' current domicile) or Wyoming (where the 
sculpture is located and the bankruptcy judgment is recorded) should be utilized 
to determine a third-party judgment creditor's rights regarding the 
sculpture.  But Robert Blackwell's 
right to execute his judgment against the sculpture in Wyoming necessarily 
depends on the effect of the conveyance of the sculpture to the Luries.  We evaluate the effect of that 
conveyance according to the circumstances existing at the time of the 
conveyance.  At that time, the 
Luries and the seller were domiciled in Missouri, and the sculpture was 
apparently situate in Missouri.  
Aside from Robert Blackwell recording the Missouri judgment in Wyoming 
and attempting to execute that judgment against the sculpture, the record does 
not reveal any additional dealings or transactions in Wyoming that might affect 
whatever interest the Luries originally acquired in the sculpture.  That the Luries may have later moved to 
Montana is not sufficient, itself, to affect the Luries' original interest in 
the sculpture.  Recognizing that the 
instant case lends itself to numerous potential factual variations, which 
variations might implicate a different legal result, we limit the application of 
our holding to the context, and facts, before us.

[¶12]   It is undisputed that the Luries 
were married at the time they acquired an interest in the sculpture.  According to Missouri law, where "two 
persons who are husband and wife become joint owners of personal property a 
presumption arises that they hold the property as tenants by the entirety.  The presumption is that each spouse owns 
an undivided interest in the whole of the property."  Merrill Lynch, Pierce, Fenner and 
Smith, Inc. v. Shackelford, 591 S.W.2d 210, 213 (Mo.App. 1979); see 
also Seabaugh v. Seabaugh, 839 S.W.2d 49, 50 (Mo.App. 1992); 
Nelson v. Hotchkiss, 601 S.W.2d 14, 18 (Mo. 1980); and 
In re Stanke, 234 B.R. 439, 441 (Bankr.W.D.Mo. 1999).3  
Robert Blackwell does not direct us to any facts sufficient to rebut such 
a presumption, and the district court found that the Luries "acquired ownership 
of the personal property in Missouri as tenants by the 
entireties."

[¶13]   Accordingly, Robert Blackwell 
cannot execute his judgment against the sculpture at this time.  The bankruptcy judgment at issue was 
entered only against Ronald U. Lurie.  
Neither Wyoming nor Missouri law allows a judgment creditor to seize 
property held by a husband and wife as tenants by the entirety to satisfy the 
individual debts of one of the spouses.  
Colorado Nat. Bank v. Miles, 711 P.2d 390, 393-94 (Wyo. 
1985); 
Merrill Lynch, Pierce, Fenner and Smith, Inc., 591 S.W.2d at 
214-15; In 
re Stanke, 234 B.R.  at 442.  It is undisputed that Nancy Lurie has 
not "conveyed, waived or otherwise conceded her ownership interest in the 
[sculpture], nor has there been any agreement conveying, waiving or terminating 
the ownership in tenancy by the entirety."  
In light of this finding, we need not address the parties' remaining 
issues, and we reverse the district court's decision.

FOOTNOTES

1

§ 6.  Choice-of-Law 
Principles

(1)        A 
court, subject to constitutional restrictions, will follow a statutory directive 
of its own state on choice of law.

(2)        When 
there is no such directive, the factors relevant to the choice of the applicable 
rule of law include

(a)        the 
needs of the interstate and international systems,

(b)        the 
relevant policies of the forum,

(c)        the 
relevant policies of other interested states and the relative interests of those 
states in the determination of the particular issue,

(d)        the 
protection of justified expectations,

(e)        the 
basic policies underlying the particular field of law,

(f)         
certainty, predictability and uniformity of result, 
and

(g)        ease 
in the determination and application of the law to be 
applied.

Restatement (Second) of Conflict of 
Laws, supra, § 6.

  2To the extent it might also apply, 
this approach is consistent with Restatement (Second) of Conflict of Laws, 
supra, § 259, which section provides:

§ 259.  Removal of Movables of Spouses to 
Another State

A marital property interest in a 
chattel, or right embodied in a document, which has been acquired by either or 
both of the spouses, is not affected by the mere removal of the chattel or 
document to a second state, whether or not this removal is accompanied by a 
change of domicil to the other state on the part of one or both of the 
spouses.  The interest, however, may 
be affected by dealings with the chattel or document in the second 
state.

"[M]arital property" is defined as 
"any interest which one spouse acquires, solely by reason of the marital 
relation, in the immovables and movables of the other spouse, apart from the 
expectancy of inheriting upon the death of the other."  Restatement (Second) of Conflict of 
Laws, supra, § 257, Introductory Note at 108.

  3Wyoming recognizes tenancies by the 
entirety in real or personal property.  
Oatts v. Jorgenson, 821 P.2d 108, 114 (Wyo. 1991); Choman v. Epperley, 592 P.2d 714, 715-19 (Wyo. 1979); National Bank of Newcastle v. 
Wartell, 580 P.2d 1142, 1144 (Wyo. 1978); Wyo. Stat. Ann. § 34-1-140 
(LexisNexis 2001).  However, joint 
tenancies and/or tenancies by the entirety are disfavored in Wyoming.  Oatts, 821 P.2d  at 
114.  In Oatts, the personal property 
at issue was a treasury bill registered to a decedent, his wife, and his 
daughter.  Id. at 109.  We stated that absent an express, "clear 
manifestation" of the intention to create a joint tenancy interest on the "face 
of the instrument," a tenancy in common will be presumed.  Id. at 114.

            
Montana apparently does not recognize tenancies by the entirety and its 
legislature has codified a rule that if "there is no law to the contrary in the 
place where personal property is situated, it is deemed to follow the person of 
its owner and is governed by the law of his domicile.'"  Lurie v. Sheriff of Gallatin 
County, 299 Mont. 283, 2000 MT 103, ¶ 13, 999 P.2d 342, 345 
(2000) (quoting § 70-1-109, MCA).  In Lurie, a case involving these 
same parties, the Montana Supreme Court held that because the Luries were 
domiciled in Montana and the personal property was also situate in Montana, 
"personal property owned by Appellant and her husband Ronald as tenancy by the 
entirety in Missouri may not be held in that manner in Montana," and such 
property was subject to execution in Montana.  Lurie, 2000 MT 103, ¶ 15, 999 P.2d  at 346.