Case Name: Charles C. Merchant, Appellant, v. Frederick D. Bunnel and Wife, Respondents
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1867-06
Citations: 3 Keyes 539
Docket Number: 
Parties: Charles C. Merchant, Appellant, v. Frederick D. Bunnel and Wife, Respondents.
Judges: 
Reporter: Keyes' Reports
Volume: 3
Pages: 539–542

Head Matter:
Charles C. Merchant, Appellant, v. Frederick D. Bunnel and Wife, Respondents.
There is nothing in the marriage relation which forbids the wife to employ her husband as her agent in the management of her estate and property; and such employment.does not subject her property, or the profits arising from such business, to the claims of the creditors of her husband.
H. R. Mygatt, for the appellant. ( -
D. Pratt, for the respondents.

Opinion:
Davies, Ch. J.
The plaintiff, as a judgment creditor of Frederick D. Bunnell, seeks to charge a tract of land of 356 acres, the title to which stands in the name of his wife, for the payment of said judgment. The land was purchased by the wife with money furnished her by her father, and the deed taken directly to her, and' for the balance of the purchase-money she executed her bond and mortage. The court, which tried this action without a jury, found as facts that Bunnell, the judgment debtor, did not pay any money or property or agree to pay any,, either directly or indirectly, toward the said 356 acres of land in dispute; nor did he or •his wife actually intend to hinder, delay or defraud the plaintiff or any' other creditor of the said Frederick D. Bunnell. The court also found that Mrs. Bunnell obtained the legal title to the 356 acres of land, by reason of the exercise of the skill, talent and judgment of her husband, combined with her own, and by the labor of each, and by the use of the money which she obtained and paid on account of said purchase, and upon the security which she gave therefor. And as a conclusion of law the court held that the 356 acres of land in dispute, were profits made in a speculation or business, mainly by the combined services, skill and judgments of Mr. and Mrs. Bunnell, and that said land is liable in equity for the. payment of debts which Mr. Bunnell owed at the time the same was purchased by Mrs. Bunnell, and that the plaintiff was entitled to judgment; declaring said 356 acres of land liable for the payment of his demands against Mr. Bunnell. And judgment was- rendered for the plaintiff accordingly, with costs. On appeal to the General Term, this judgment was reversed, and a new trial ordered. The plaintiff appeals from this order to this court, and stipulates that if the same be affirmed, that judgment absolute shall be rendered against him.
The only question presented for adjudication in this case is, whether property bought by the- husband as the agent of his wife, with her money, and afterward sold by him as her agent at a profit, is, to the extent of the profit, subject to the claims of the creditors of the husband, on the ground that the profit was the result of his skill or ability; it having been found by the court as already stated; that the property was not bought or sold with intent to defraud the creditors of the husband. It is to be observed, in the first place, that it is difficult if not impossible to separate and determine the proportion of profit exclusively derived from the talent, skill and ability of the husband from that derivable from the capital, talent and skill of the wife. It is very clear that the court, upon the trial of the action, erred in assuming that the whole profit made by the use of the money and credit of the wife, and her talent and skill, was exclusively the'product of the skill and ability of the husband. Ho-discrimination was.made by the court which tried the action, as to what part of the profit was the result or product of the labors of the husband, or what was produced by the use of the money and credit" of the wife. The difficulty, if not impossibility, of making this discrimination, may probably have led the court into the error of holding that the whole profit, made upon the investment of the money of the wife, was exclusively due to the skill and talent of the husband. The real question for adjudication is, whether the profits derived and made from an investment of the money of the principal, in the name of the principal, by an agent, acting as such, belongs and is the property of the principal or is that of the agent ? The simple statement of this proposi tion carries -with it, the appropriate answer, and the result is none the less the same, because the principal and agent may sustain other relations to each other, as even in the present case, the intimate one of husband and wife.
This court has frequently held that there is nothing in the marriage relation which forbids the wife to employ her husband as her agent in the management of her estate and property, and that such employment does not subject her property or the profits arising from such business, to the claims of the creditors of her husband. (Sherman v. Elder, 24 N. Y. 381; Knapp v. Smith, 27 id. 277; Buckley v. Wells, 33 id. 518; Gage v. Dauchy, 34 id. 293.)
These cases conclusively establish the right of the wife to her separate estate, and that neither the same nor the profits derived therefrom, although the same be managed by the husband as the agent of the wife, can be subjected, by the creditors of the husband, to the payment of his debts. The precise point now presented for adjudication arose and was decided in Buckley v. Wells (ubi supra). It was there held that a married woman is entitled to the profits of mercantile business conducted by the husband in her name when the capital is furnished by her, and he has no interest but that of a mere agent.
It was pertinently observed by Judge Porter in this case, " The creditors of the husband have no right to complain if persons are found who are willing to give credit to the wife. If they cannot enforce their claim at law against her, it is their misfortune and does not concern or affect the rights of the husband's creditors; and it is difficult to see how it thereby tends to vest the title of the property purchased for her, and for which credit is given to her, in her husband. It is also said that the skill- and labor of the husband, when employed by the wife, as in this case, enters into and forms as it were a part of the property and increases its value. If the business is successful, granted, but the title is not thereby divested; at most he could but have a lien for his wages. The whole case turns upon the question, whether a wife having separate property can employ her husband as her agent. If she can then the objections raised cannot avail as a defense. This question was distinctly settled in Knapp v. Smith (27 N. Y. 277), where the law is very distinctly laid . down, and where it was held that a married woman, having property of her own, could manage it by the agency of her husband or any other, and hold the profits and increase to her separate use."
The doctrine of these cases has received the emphatic approval of this court in the case of Gage v. Dauchy (ubi supra).
• The order granting a new trial in this action should be affirmed, and in the pursuance of the appellant's stipulation, judgment absolute should be rendered' against him with costs.
All concur.
Judgment affirmed.