Bank of Commerce, Ltd. v. Baldwin

AILSHIE, J.

This action was commenced by the Bank . of Commerce against Geo. E. Baldwin and Sarah A. Bowers to recover a balance of $5,697.05 due on a promissory note executed by Baldwin and Mrs. Bowers on the fourth day of November, 1903. Baldwin defaulted and Mrs. Bowers answered admitting the execution of the note and the amount *207 due, but denying her liability for the reason that the same was executed by her simply as a surety for Baldwin, and that the contract did not in any way affect her separate property, and was not made for her .use and benefit or in reference to her separate estate. The case came on regularly for trial and the plaintiff introduced its evidence. The defendant moved for a nonsuit on the ground that the evidence of the plaintiff failed to show that the contract was executed for the benefit of or concerning the separate property or estate of Mrs. Bowers, or for her individual or separate use and benefit. This motion was sustained by the court and the plaintiff moved for a new trial, which was denied, and thereupon appealed from the judgment and order denying the motion. The principal and leading question to which the respective counsel have directed their attention on this appeal is the effect of the act of the legislature approved March 9, 1903, and entitled, “An act giving to married women the management, control and power of disposition of their separate property, amending section 2495, chapter 3, title 2, Revised Statutes of 1887 of Idaho, and repealing sections 2498 and 2499 thereof and all other acts in conflict herewith. ’ ’ Sections 1 and 2 of that act are as follows: ‘ ‘ See. 1. That section 2495, of chapter 3, title 2, of the Revised Statutes of Idaho, 1887, be amended to read as follows: See. 2495. All property of the wife owned by her before marriage, and that acquired afterward by gift, bequest or descent, or that she shall acquire with the proceeds of her separate property, shall remain her sole and separate property, to the same extent and with the same effect as the property of a husband similarly acquired. Sec. 2. During the continuance of the marriage the wife has the management, control and absolute power of disposition of her separate property, and may bargain, sell and convey her real and personal property, and may enter into any contract with reference to the same in the same manner and to the same extent and with like effect as a married man may in relation to his real and personal property; provided, that the husband shall be *208 bound by such contracts to no greater extent or effect than his wife under similar circumstances would be bound by his contracts.” The act closes with section 5, which specifically repeals sections 2498 and 2499 of the Revised Statutes of 1887. It is contended by counsel for respondent that under the decisions in this state as announced prior to the adoption of the act of March 9, 1903, the plaintiff is not entitled to recover. (Dernham v. Rowley, 4 Idaho, 753 , 44 Pac. 643 ; Jaeckel v. Pease, 6 Idaho, 131 , 53 Pac. 399 ; Strode v. Miller, 7 Idaho, 16 , 59 Pac. 893 ; Holt v. Gridley, 7 Idaho, 416 , 63 Pac. 188 .) Appellant contends, however, that the foregoing legislation so extended and enlarged the powers and corresponding liabilities of a married woman as to make respondent liable on the contract in question. This can best be determined by first ascertaining the purpose and extent of this latter legislation. First, it gives the wife the absolute control and management of her separate property and repeals section 2498 which had formerly given the management and control of her property to the husband. Second, it gives to the wife the sole and absolute power to sell and dispose of her separate property and carry on business therewith and make contracts in reference thereto and for the benefit thereof, and repeals section 2499 which provided for the appointment of a trustee to manage her separate property. In this respect McDonald v. Rozen, 8 Idaho, 352 , 69 Pac. 125 , is no longer the rule of law in this state. It is safe to say that a most careful examination and consideration of the act of March 9, 1903, will disclose no legislation nor legislative intent therein to in any respect change the wife’s legal status with reference to any subject or matter other than her separate property. Prior to the amendment the husband was entitled to the custody, control and management of his wife’s separate property, but now she is entitled to its custody and control and may sell and dispose of it without consulting him. She may also make any contracts she pleases with reference thereto. In all other respects the law of this state remains the same with reference *209 to her contracts as it was when the above-cited cases were decided by this court. It should be borne in mind that all our legislation with reference to contracts, powers and liabilities of married women must be viewed and construed as grants instead of restriction of power and authority to contract.

In Dernham v. Rowley, supra, the question arose as to the power of the wife to bind herself to pay a' debt contracted by the husband for his use and benefit, and this court speaking through Chief Justice Morgan said: “From this exposition it will clearly appear that in order to charge the separate property of the wife, or render it liable to levy and sale, it must be alleged in the complaint, and proven, that the debt was incurred for the use and benefit of her separate property, or was contracted by her for her own use and benefit. ’ ’

In Jaeckel v. Pease, supra, the question arose as to the power of the wife to bind herself on a debt contracted for the benefit of the community property, and this court, speaking through Justice Quarles, said: “A married woman cannot bind herself personally for the debt of her husband, or for a community debt, and it is error to render judgment jointly against the husband and wife on a note signed by both in the absence of a showing that the debt was created for the separate use and benefit of the wife, or for the use and benefit of her separate estate.”

In Strode v. Miller, supra, the same principle was enunciated and Jaeckel v. Pease was cited with approval.

In Holt v. Gridley, supra, a similar question was involved, and this court, speaking through Justice Sullivan, said: “It also appears that the defendants are husband and wife, and there is nothing in the record to show that her separate property is liable for the indebtedness sued on herein. Where it is sought to make the separate property of a married woman liable for debt, it must be alleged and proved that the debt is her own, or made on behalf of her separate property. The wife is not personally liable for the debts of her husband, and neither is her separate property.”

*210 It follows from what we have already said that in order to bind Mrs. Bower's in this case it will be necessary for the plaintiff to show that the debt was contracted for the nse or benefit of her separate property or for her own use or benefit, or in reference to the management, control or business transactions touching such property. There can no longer be any question in this state as to the power of a married woman to bind her separate property and estate for the payment of a debt. The nature of the argument advanced in this ease, however, makes it necessary for us to observe that the mere representation by a feme covert that she owns a certain amount, class and character of property in her own name and right does not create a liability against her estate for a debt not contracted for her use or benefit or the benefit of such estate. In order to create a charge against her estate for such a debt, it must be made a charge in rem by a mortgage or pledge of the property or in some manner known to or recognized by the law as constituting a lien upon or charge against the specific property. It is not sufficient to furnish a list of property and say: ‘ ‘ This is my separate property and I own it in my own name and right. ’ ’ It has been repeatedly held that a married woman who signs a promissory note with her husband for the payment of his debt and executes a mortgage on her property to secure the payment of the same, creates a liability only in rem and not in personam. The property encumbered is liable for the payment of the debt, but when exhausted, the obligation, as against the wife, is extinguished, and no personal liability attaches. (Jaeckel v. Pease and Strode v. Miller, supra.) It is different, however, where the liability was originally the wife’s debt or contracted with reference to her separate property and estate; or in the management and control thereof; or in the carrying on and transacting business therewith or in reference thereto. In the case at bar the obligation, if an obligation at all, is only in personam, as no property appears to have been mortgaged or encumbered or pledged for the payment of the debt.

*211 We have examined the evidence introduced on behalf of the plaintiff in this case very carefully, and while it is rather meager and slight, we think it is sufficient to bring the ease within the rule announced at the present term in Later v. Say-wood, ante, p. 78, 85 Pac. 494 , where the court said: “On a motion by the defendant for nonsuit after the plaintiff was introduced his evidence and rested his ease, the defendant must be deemed to have admitted all the facts of which there is any evidence, and all the facts which the evidence tends to prove.” (See, also, Simpson v. Remington, 6 Idaho, 681 , 59 Pac. 360 ; Kansteiner v. Clyne, 5 Idaho, 59 , 46 Pac. 1019 ; Lewis v. Lewis, 3 Idaho, 645 , 33 Pac. 38 ; York v. P. & N. Ry. Co., 8 Idaho, 574 , 69 Pac. 1042 .) The debt sued on in this ease might have been incurred for the use and benefit of the respondent or for the benefit of her separate estate, and still she might not have actually received and disbursed the money. It may, on the other hand, have been incurred entirely and solely for the use and benefit of her codefendant, Baldwin, The plaintiff, we think, introduced sufficient evidence to put the defendant to her proofs, and we shall therefore order a new trial. If the respondent can establish a defense that will bring her within the purview of the law as herein announced, she will defeat plaintiff’s right of recovery; otherwise she will fail. The parties should have a full hearing on the merits of this ease. Judgment reversed and a new trial granted. Costs awarded to appellant.

Stockslager, C. J., concurs.