Court Opinion

ID: 6509598
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:21:12.215746+00
Date Added: 2024-06-11T15:54:50.246609
License: Public Domain

STONE, J.
There is no contest raised over the first loan of money, five hundred dollars, by Stolla to Mrs. Peeples, then Mrs. Lake. This loan is admitted in the bill; and it is also admitted that Mrs. Peeples was then a femme sole. The bill describes this as’a simple contract debt, while the *57answer sets up that Mrs. Peeples [Lake] cotemporaneously executed to Stolla a mortgage on the premises in controversy to secure its payment. The testimony proves the averments of the answer, in this respect, to be true. It is thus shown that when> Mrs. Lake intermarried with Peeples, she owed Stolla five’ hundred dollars, to secure the payment of which he held her mortgage duly acknowledged, but not recorded.
When the second transaction took place, Mrs. Peeples was a married woman. At that time Stolla parted with another five hundred dollars. He testifies that he paid it to Mrs. Peeples; she, that he lent it to her and her husband, Peeples. We are inclined to the conviction that the money was paid to her, but it is not important who received the money. We are satisfied she' conducted the negotiation, and that the money was obtained on the strength of her property. The theory and gravamen of the bill are, that the conveyance of -June 4, 1872, “Exhibit A,” to the bill, is a mortgage made by a married woman to secure the repayment of borrowed money. If this be true, under our decisions such mortgage ■does not bind the statutory separate estate of a married woman.—Conner v. Williams, 55 Ala.; Coleman v. Smith, 55 Ala.; Northington v. Faber, 52 Ala. 47; Bibb v. Pope, 43 Ala. 90; Wilkinson v. Cheatham, 45 Ala. 337. We hold that the power of the husband and wife to sell the property of the wife, or any part thereof, and to convey the same by their joint instrument of writing, under section 2373 of the Bevised Code, does not confer the right on them to make a mortgage.—Bloomer v. Waldron, 3 Hill, N. Y. 361, 366; 2 Washb. Beal Property, 318, § 5; Albany Fire Insurance Co. v. Bay, 4 Const. 9, 19. We reach this conclusion by considering the class of contracts for which the ■wife’s separate estate maybe charged, under section 2375; her qualified power of disposition under sections 2373 and 2378; the directions as to the proceeds of such sales, found in section 2374; the power over, and rights in such property reserved to the husband under sections 2372, 2375, and 2379; and the mode provided in sections 2384 and 2385, of restoring the wife to the control of her estate, the rents, issues and profits thereof, as if she were a femme sole, and conferring on her the right to sue and be sued in her own name. These sections, together with the entire system, show a fixed purpose to make this a peculiar estate, and to circumscribe the powers of both the husband and wife, within express provisions. This power in the wife is very unlike that which a married woman may exercise over her equitable separate *58estate.—See 2 Kent Com. 167; Sampson v. Williamson, 6 Tex. 115; 2 Brick. Dig. 86, §§ 211, 213; Ozley v. Ikelheimer, 26 Ala. 332; Cowles v. Morgan, 34 Ala. 335.
The conveyance of June 4, 1872, from Peeples and wife-to Stolla, is, in form, an absolute deed of bargain and sale, with full covenants of warranty, with a clause inserted in it as follows : “ L. C. Stolla hereby agrees to and with the parties of the first part, Catherine Peeples and H. J. Peeples, that said parties of the first part shall have the right to purchase back the within described property for eleven hundred ($1,100) dollars, within twelve months from the date hereof; together with the tenements, hereditaments, rights, members, privileges, and appurtenances unto the above mentioned and described premises belonging, or in any wise appertaining.” Is this a mortgage, or a sale with the reserved privilege of repurchasing? If the former, then, in equity, the ownership of the property remained with Mrs. Peeples, and Stolla had only a right to enforce the collection of his claim out of it. The effect of a mortgage, made by one capable in law of executing such contract, is to leave on the mortgagor a personal liability for the residuum of the debt, if, on foreclosure, the property mortgaged fails to yield a sum sufficient to pay it in full. Hence, one of the tests by which to determine whether- or not a mortgage was intended, is the existence or not of a debt to uphold it. If there is no debt, there can be no mortgage. On the other hand, security for a debt is incompatible with the idea of a conditional sale; and when shown to exist, is conclusive that the transaction is a mortgage.
The extrinsic proof in this record varies widely. Mrs. Peeples testifies that her husband informed her it was a mortgage, and her understanding was that she was executing a mortgage. She leaves it in doubt whether Stolla heard the representation so made by Peeples. Stolla is directly at issue with her; says he refused to take a mortgage; that he purchased the property, and stipulated in the deed that the parties should have the privilege of repurchasing. Loomis,, the justice, fully eorrobrates Stolla, and says he fully explained the conveyance to Peeples and wife before they executed it. Stolla testifies that when he loaned the five hundred dollars to Mrs. Lake, he took her mortgage on the lot in dispute to secure its payment. "When the second conveyance was executed, the mortgage was given up, and, not having been recorded, was destroyed. There is no evidence in the record that any note was ever given to evidence a. *59debt; and the record is silent whether any debt was claimed, on or after the day the second conveyance was executed.
In the case of McKinstry v. Conly, 12 Ala. 678, Mallett had made to Conly an absolute bill of sale to slaves, with the following cotemporaneous writing, executed by Conly to Mallett:
“I, Morris J. Conly, do hereby promise to Giles M. 'Mallett that, upon payment being made to me of the sum of $1,876, with lawful interest from date, I will re-sell to him, if they are in my possession, three of the negro slaves, namely, John, Elsey a black, and Elsey a mulatto girl, more fully described in book, &c., in the clerk’s office of Mobile county.
(Signed) “M. J. Conly.”
It was held that this was a sale, with condition to repurchase. The court said:
“ It appears there had been a previous mortgage on these slaves, executed by Mallett to the defendant, which was abandoned by the parties, and the contract executed, which it is now insisted was intended to operate as a mortgage. The question here naturally presents itself, why was this change made ? If a mortgage was intended, why abandon the one already executed and substitute another in its stead, importing on its face an entirely different contract, and which could only be established to mean something else by extrinsic parol proof, of which no one had any knowledge but the parties themselves ? ”
In West v. Hendrix, 28 Ala. 226, 234, we said: “ When a deed is made for a consideration paid at the time, whether the payment is made in cash, or by the surrender and satisfaction of a precedent debt, it will not lose the character of a conveyance, by an agreement on the part of the vendee to allow the vendor to repurchase at a future day for the same price as for an advanced price.” It was further said, in that case, that “ the fact that the party executing a conveyance, absolute in its terms, intended and considered it as a mortgage, is not sufficient to make it a mortgage. To produce that effect, such must have been the clear and certain intention and understanding of the other party likewise.”'Again: “Inadequacy of price or consideration, alone, will not convert an absolute conveyance into a security for the repayment of money.” See, also, Murphy v. Barefield, 27 Ala. 634; Bishop v. Bishop, 13 Ala. 475; Brantley v. West, 27 Ala. 542.
Upon a fair survey of all the evidence in this cause, we *60do not think the property in controversy was worth more than eleven or twelve hundred dollars. Hence no question can be raised here as to insufficient cqnsideration.
Our conclusion is, that the conveyance of June 4, 1872, is what is usually called a conditional sale. A sale, with condition to repurchase, is probably a more accurate designation.
While we have held, as shown above, that a married woman can not pledge her statutory separate estate by mortgage, both the letter and spirit of the statute require us to hold that she and her husband may convey by deed. — See Revised Code, § 2373.
Can she make a sale, reserving the right to repurchase? Such reserved right is usually incorporated in the contract at the instance, and for the benefit of the seller. We are not able to perceive that it can operate to her prejudice. The sale stands as a sale, if there be no fraud; and in making it, she does no more than the statute authorizes her to do. So, she and her husband may make an executory purchase on her account, may use her statutory separate estate, moneys and otherwise, in making the purchase, and may pledge the property purchased, by way of mortgage, to secure unpaid purchase money.—Marks v. Cowles, 53 Ala.; Pylant v. Peeves, 53 Ala. 132; Sterrett v. Coleman, at the present term.
We are unable to draw or approve a distinction which will uphold as valid and binding a contract by which a married woman purchases property which she never owned, and, at the same time, declare invalid her contract of sale of her own property, because she reserves in such sale the mere privilege to repurchase; a privilege of which she may or may not avail herself at her option.
In what we have said above, we do not intend to affirm that every contract of such married woman, having the power of a conditional sale, will be upheld. Such contract, to withstand judicial scrutiny,-must be a real sale — not a covert mortgage, a security, or cover for usurious interest. Where the real transaction is a loan of money to be repaid, it is a mortgage.
Ascertaining the rights of these parties to be as shown above, it is manifest that the present bill can not be maintained. It proceeds on the idea that the conveyance is a mortgage, and that it is void by reason of the coverture of Mrs. Peeples. Her only remedy is to have specific execution of her conditional contract of purchase, on proper allegations and proof. They are not found in the present record.
We deem it unnecessary to notice at length the convey*61anee of April 6, 1873. As tbe property was then tbe homestead of Mrs. Peeples, if she owned any interest in it at that time, the conveyance was not so acknowledged and certified as to devest her interest, under the homestead law of April 23, 1873.—See Marks v. Miller, 55 Ala.
Mrs. Peeples can take nothing by her appeal, but her next friend and sureties must pay the cost thereof.
On the cross appeal of Stolla, the decree of the chancellor is reversed, and a decree here rendered dismissing the bill, at the costs of complainant’s next friend in the court below and in this court.