Scott v. Holman

Counsel for the plaintiif insist that the case is governed by two sections of our statutes, which declare that:

“When a grant for a valuable consideration shall be made to one person and the consideration therefor shall be paid by another, no -use or trust shall result in favor of the person by whom such payment is made; but the title shall vest in the person named as the alienee in such conveyance subject only to the provisions of the next section.”

“Every such conveyance shall be presumed fraudulent as against the creditors of the person paying the consideration, and when a fraudulent intent is not disproved a trust shall result in favor of such creditors to the extent that may be necessary to satisfy their just demands.” Secs. 2077, 2078, Stats. 1898.

The whole consideration paid for the house and lot in question was $970. Of that sum the husband furnished to his wife at the time of her purchase $450, and subsequently he paid upon the note and mortgage which she gave back to secure a part of the purchase price $170, making his contribution to the purchase of the house and lot $620; and counsel contend that under the statutes quoted such payment by the husband, to the amount stated, must be presumed to be fraud*210ulent as against his creditors, and to that extent the wife must he regarded as holding the title to the house and lot in trust for such creditors. But by the express language of the last section quoted such can only be the result “when a fraudulent intent is not disproved.” Here the court found from the admitted facts that there was no such fraudulent intent. Counsel insist that the presumption of such fraudulent intent has not been rebutted, and yet counsel concede, as they must under the decisions of this court, that it would have been perfectly legitimate for the husband to have purchased the house and lot in question, and taken the title thereof in his own name, and held it as his homestead, and then conveyed it to his wife, without subjecting it to the claims of his creditors. Hibben v. Boyer, 33 Wis. 319; Pike v. Miles, 23 Wis. 164. This is on the theory that it may be legitimate for an insolvent debtor to use moneys or nonexempt property in procuring a homestead. This court has held that “the mere fact that an exchange of nonexempt for exempt property might be highly advantageous to an insolvent debtor is not conclusive evidence of an intention to defraud his creditors.” Kapernick v. Louk, 90 Wis. 232, 234, 62 N. W. 1057; Palmer v. Hawes, 80 Wis. 474, 50 N. W. 341. Since he may do that, we perceive no good reason why he may not join with his wife, who may have separate property of her own, in procuring a homestead for both of them. Thus it was held by this court more than forty years ago that, “A homestead being exempt from forced sale upon execution, it matters not whether the title remain in the execution debtor or be held by his wife as his trustee.” Dreutzer v. Bell, 11 Wis. 114; Rozek Redzinski, 87 Wis. 525, 531, 58 N. W. 262. At the time of the purchase of the house and lot the wife had $250, and her husband had $450, which he had saved from his earnings for the purpose of buying a homestead. There was a lawsuit pending against the husband,and another man upon a contract made eight years before. There is no evidence of any other claims being made *211against bim at the time. They used tbe moneys they both had in buying a homestead and taking the title in the name of the wife. There is nothing nnnatnral in the transaction, nor anything indicating an intent to defraud creditors. It was said by the late Justice NewmaN, speaking for the court:

“The right of the owner to have his homestead exempt from liability in any form for his debts is superior to the equity of a creditor to have it applied to the payment of his debt. However it may have been formerly, and in the absence of a statute declaring his right, it is now the settled policy of the law to prefer the homestead right as against the rights of creditors.” Clancey v. Alme, 98 Wis. 230, 73 N. W. 1014.

The admitted facts rebut any presumptions of fraudulent intent arising from the statute.

By the Court. — The judgment of the circuit court is affirmed.