McNair v. Moore , 64 S.C. 82 ( 1902 )

April 19, 1902. The opinion of the Court was delivered by The object of this action was to subject lands held by Julia C. Moore to the payment of a judgment against her husband, John W. Moore. It appears that in January, 1894, defendant, J.W. Moore, executed his notes to plaintiff to secure payment of a balance on account commencing in December, 1886, and that in April, 1899, plaintiff recovered a judgment thereon for $3,490.69. In December, 1886, the defendant, J.W. Moore, went into possession of the land in question under a contract in writing to purchase same from L.M. Coker in certain specified installments, and holding L.M. Coker's bond for title to be executed upon the payment of the sum of $2,250, with annual interest. Between the 21st December, 1886, and April 25, 1891. John W. Moore made payments to L.M. Coker and to his executor, W.C. Coker, aggregating $1,638.69. There after, in 1892, an arrangement was made between John W. Moore and his wife, with the consent of Coker's executor, under which Mrs. Moore undertook to pay the balance of the purchase money upon condition that title to the premises be made to her; and pursuant thereto Mrs. Moore made payments in full of said balance, aggregating $1,208.79, and in 1896 received from Coker's executor a deed of the land in her name. The Circuit Court found that John W. Moore did in effect make a voluntary transfer of his equitable interest in the land to his wife, with intent to save for her and himself a home at the expense of his creditors, but that the wife was not cognizant of any wrongful intent on the part of her husband. The Court further held that Mrs. Moore having paid the balance of the purchase money in good faith, should receive back the money so expended. Accordingly, decree was made that the land be sold, that out of the proceeds Mrs. Moore be first paid the sum of $1,208.79, and that out of the balance, if sufficient for that purpose, the plaintiff's judgment be paid.

Both sides appealed from this judgment. For a more detailed statement of the facts reference may be had to the decree herewith reported, along with the exceptions thereto. Under the view we take of the case, it will not be necessary to examine the exceptions in detail.

We concur with the Circuit Court that the arrangement under which Mrs. Moore became the beneficiary of the payments made by her husband was a voluntary transfer by the husband to the wife, of his equitable interest in the land; but the Circuit Court erred in failing to take into consideration to what extent such transfer affected the rights of the husband's creditors. The case of Finley v. Cartwright, 55 S.C. 198, shows that an insolvent husband may, as against his creditors, convey his homestead to his wife, for the reason that such homestead is not subject to, but is expressly exempt from debt not for the purchase money. The case of Munro v. Jeter, 24 S.C. 29; overrulingGaraty and Armstrong v. DuBose, 5 S.C. 493, shows that a homestead may be claimed in land held under an equitable title only. Whatever property of a debtor may in law or equity be subjected to the payment of his debt is likewise subject to the debtor's homestead right. By sec. 28, art. III., of Constitution, a homestead may be in lands, "Whether held in fee or in a lesser estate." It is argued that this question was not considered by the Circuit Court and ought not to be considered here; but such consideration ought to have been had, as it was necessarily involved in properly determining the question of fraud and the right of the creditor to subject such property to his debt. It is further argued, that a large part of the debt due plaintiff was for money used in paying the purchase price, and that there is no right of homestead against such a debt. The complaint shows that the debt was for an account for money and supplies to enable Moore to conduct a business in turpentine. Even if defendant did in fact use some of the money so advanced in making payments of the land, the debt contracted by him with plaintiff was not for the purchase money of the land, in the sense of the Constitution. Therefore, to the extent that the homestead right of J.W. Moore, who by the record appears to be the head of a family resident in this State, covers the equitable interest which he had in the premises which he transferred or conveyed to his wife, there could be no fraud and no violation of the right of creditors. Creditors were only affected to the extent that the value of J.W. Moore's equitable interest at the time of the transfer to his wife exceeded $1,000, the amount of his right of homestead, and to this extent only should the land have been subjected to the payment of plaintiff's judgment.

The judgment of the Circuit Court is modified, and the case is remanded, with instructions to ascertain the nature of J.W. Moore's equitable interest in the land at the time of the transfer thereof to Julia C. Moore, and to subject said land to the claim of plaintiff only to the extent which the value of the equitable interest exceeded $1,000, the value of his right of homestead.