WIGGINS V. RUSH, 1971-NMSC-092, 83 N.M.
133, 489 P.2d 641 (S. Ct. 1971)
WALT WIGGINS, Plaintiff-Appellee,
vs.
WILFRED E. RUSH, Defendant-Appellant
SUPREME COURT OF NEW MEXICO
1971-NMSC-092, 83 N.M. 133, 489 P.2d 641
Appeal from the District Court of
Chaves County, Reese, Jr., Judge
SANDERS, BRUIN & BALDOCK, Roswell,
New Mexico, Attorneys for Appellee.
GARLAND, MARTIN & MARTIN, WILLIAM L.
LUTZ, Las Cruces, New Mexico, Attorneys for Appellant.
MONTOYA, Justice, wrote the opinion.
J. C. Compton, C.J., John B. McManus, Jr.,
J.
{1} This is a suit wherein
the plaintiff-appellee Walt Wiggins, hereinafter called
{*134}
"Mr. Wiggins," in an action for a declaratory judgment, filed a
complaint against his wife Roynel F. Wiggins, hereinafter called "Mrs.
Wiggins," Wilfred E. Rush, hereinafter called "Mr. Rush," and
others, the latter being the grantors of three deeds to certain property
wherein Mr. and Mrs. Wiggins were the grantees. Mr. Wiggins alleged the
property was his sole and separate property. Appellant Mr. Rush was the only
answering defendant in the case and he contends that the property in question
was held either in joint tenancy or as community property, and that the
transcript of the judgment filed by him, which had been obtained in a case for
an antenuptial debt of Mrs. Wiggins, was a valid lien against the property
described in the complaint.
{2} In summary, the following
are the pertinent findings made by the trial court. Prior to her marriage to
Mr. Wiggins in April 1963, Mrs. Wiggins had signed and delivered to Mr. Rush
her promissory note for $35,000 dated September 1, 1962. At the time of her
marriage, Mrs. Wiggins owned separate property in Texas and Arizona.
{3} After their marriage, Mr.
and Mrs. Wiggins acquired a farm in Kansas, both being named as grantees in the
deed. On January 5, 1965, Mrs. Wiggins quitclaimed her interest in the Kansas
property to Mr. Wiggins, and also conveyed her separate property in Texas to
her brothers. In 1966, the Kansas property was traded by Mr. Wiggins for
certain property in Arkansas, and the Arkansas property was deeded to both Mr.
and Mrs. Wiggins. That same year, the Arkansas property was traded for some
Texas property and title thereto was taken in both their names. In 1966, the
Texas property was traded to one of the defendants Geneva Spurrier for certain
Chaves County property, which is involved in this action. That deed conveyed
the property to Mr. and Mrs. Wiggins as joint tenants. In 1967, Mr. and Mrs.
Wiggins acquired two other tracts of land in Chaves County, New Mexico, from
two different grantors, M. C. Scott and G. E. Stephens. The deed from Scott
conveyed title to Mr. and Mrs. Wiggins, with no recital as to their marital
status. The deed from Stephens conveyed that land to Mr. and Mrs. Wiggins as
joint tenants. During their marriage, Mr. and Mrs. Wiggins acquired title to
two other tracts of land in Lincoln County, New Mexico, and title was conveyed
to them as joint tenants. When the properties in Kansas and Texas were
purchased, both Mr. and Mrs. Wiggins executed notes and mortgages to secure the
purchase price. In acquiring the Arkansas property, both Mr. and Mrs. Wiggins
assumed the encumbrances on the property.
{4} During their marriage,
Mr. and Mrs. Wiggins had joint bank accounts, or other accounts on which Mrs.
Wiggins was authorized to sign checks. No effort was made by them to separate
their properties or moneys during their marriage. They commingled their
property and income and no effort was made to segregate income acquired from
separate property. Substantial mortgage payments from joint accounts were made
by Mr. Wiggins from his earnings upon the property acquired during the marriage.
The court also found that they never intended to take title to their properties
in joint tenancy, and that Mr. Wiggins never intended to give his wife an
undivided one-half interest in the properties. The court further found that the
properties involved in this action were acquired through the joint efforts of
both Mr. and Mrs. Wiggins and were community property.
{5} Mr. Rush obtained a
judgment against Mrs. Wiggins in the Sierra County District Court, based upon
the $35,000 promissory note, and filed a transcript of said judgment in Chaves
County. In another case filed in Chaves County, a decree was obtained
foreclosing the Sierra County judgment lien against the undivided interest of
property conveyed to Mr. and Mrs. Wiggins by Stephens et ux., but no
adjudication was made as to the character and
{*135}
extent of such interest because Mr. Wiggins was not a party to such action.
{6} The trial court concluded
that Mr. and Mrs. Wiggins did not intend to take the properties as joint
tenants; that the evidence was clear and convincing the properties in question
were acquired through their joint efforts; and that the properties in question
were community property.
{7} The trial court also
concluded that the community property of Mr. and Mrs. Wiggins was not liable
for the antenuptial debts of Mrs. Wiggins. Therefore, the judgments in cause
No. 35085 of the District Court of Chaves County, and cause No. 7076 in Sierra
County and recorded also in Chaves County, did not constitute effective liens
to the properties described in Mr. Wiggins' complaint.
{8} Appellant Mr. Rush relies
upon two points in seeking reversal of the trial court's decision. One
contention is that there was no evidence to overcome the statutory presumption
of joint tenancy, and the trial court's finding, that the property of Mr. and
Mrs. Wiggins was community property, was not supported by substantial evidence.
The other contention advanced by appellant is that, even if the property is
community property, it would be liable for the antenuptial debts of Mrs.
Wiggins.
{9} Appellant's first
contention relies heavily upon § 70-1-14.1, N.M.S.A. 1953 Comp., which reads as
follows:
"An instrument conveying or transferring title to real
or personal property to two [2] or more persons as joint tenants, to two [2] or
more persons and to the survivors of them and the heirs and assigns of the
survivor, or to two [2] or more persons with right of survivorship, shall be
prima-facie evidence that such property is held in a joint tenancy and shall be
conclusive as to purchasers or encumbrancers for value. In any litigation
involving the issue of such tenancy a preponderance of the evidence shall be
sufficient to establish the same."
{10} The major question is
whether there is a preponderance of the evidence to support appellant's
contention that the property was a joint tenancy. Both the intention of the
parties and the source of funds used to purchase the property have bearing on
this issue.
{11} The trial court found
that Mr. and Mrs. Wiggins did not understand the meaning or effect of a joint
tenancy, nor did they wish to hold the property as joint tenants. Hence, the
court's conclusion, that Mr. and Mrs. Wiggins did not intend to take the
property as joint tenants, has substantial support in the record.
{12} In examining the source
of funds used to purchase the property, the trial court found that, during
their marriage, Mr. and Mrs. Wiggins made no effort to segregate their separate
funds from their community funds, nor was any accounting made as to sources of
income. It appears that all moneys were deposited in a joint account. The rule
is that if separate property has been so commingled or mixed with property
acquired after marriage, so that the separate property cannot be clearly traced
or identified, then there is a presumption that the property acquired after
marriage is community property, unless this presumption can be overcome by
proof. Stroope v. Potter,
48 N.M. 404,
151 P.2d 748 (1944); Burlingham v.
Burlingham,
72 N.M. 433,
384 P.2d 699 (1963); Wood, the Community Property Laws
of New Mexico, Ch. V, § 24 at 38 (1954).
{13} Nothing appears in the
record to indicate that the separate funds of either Mr. or Mrs. Wiggins were
traceable in their joint account. The effect of this commingling was that any
separate funds deposited in the joint account were transmuted into community
funds. See, Burlingham v. Burlingham, supra. The trial court also found these
community funds were used to purchase the property, and that mortgage payments
on the property were made with community funds.
{14} Because it was not the
intention of Mr. and Mrs. Wiggins to hold the property as joint tenants, and
because community funds were used to purchase the property,
{*136}
the trial court concluded that a joint tenancy was not created. This
conclusion, being supported by evidence of a clear and convincing nature,
should be upheld.
{15} Appellant further argues
that § 57-4-1, N.M.S.A. 1953 Comp., is applicable. That section states:
"All other real and personal property acquired after
marriage by either husband or wife, or both, is community property; * * *
except, that when any such real or personal property is acquired by husband and
wife by an instrument in writing in which they are described as husband and
wife, unless a different intention is expressed in the instrument, the
presumption is that such property is community property of said husband and
wife. * * *"
However, in view of the trial court's findings, that
community funds were used to purchase the property, the fact that the deeds
named Mr. and Mrs. Wiggins as joint tenants is not controlling. In re Trimble's
Estate, 57 N.M. 51, 253 P.2d 805 (1953).
{16} Having held that the
property in question was community property, the next question is whether the
interest of Mrs. Wiggins in the community property is liable for her
antenuptial debts.
{17} There are several
statutory provisions governing the community estate. See, §§ 57-3-8, 57-3-9,
57-4-2, 57-4-3, 29-1-8, N.M.S.A. 1953 Comp., and § 29-1-9, N.M.S.A. 1953 Comp.
(1969 Pocket Supp.), but none of these sections deal with the precise question
of whether the community is liable for antenuptial debts of either spouse. This
court has held the wife's separate property was not liable for community debts,
E. Rosenwald & Son v. Baca et al,
28 N.M. 276,
210 P. 1068 (1922), but we
have not decided whether the community would be liable for a spouse's
antenuptial debt.
{18} There is no unanimity
among the courts as to how this question should be resolved. The California
court has held that the separate property of the wife and the community estate
were equally liable for the debts of the wife contracted before marriage. Van
Maren v. Johnson, 15 Cal. 308 (1860). Texas also reached the same result,
however the holding in the Texas case may be modified by reason of subsequently
enacted statutes. Dunlap v. Squires, 186 S.W. 843 (Tex. Civ. App. 1916).
{19} In Washington, the court
held that community property would not be liable for the antenuptial debt of
one of the spouses. Escrow Service Co. v. Cressler, 59 Wash.2d 38, 365 P.2d 760
(1961). That decision apparently was based upon a statute lending itself to
that interpretation. See, R.C.W. 26.16.200. The Arizona court also has determined
that the community estate would not be liable for the antenuptial debts of one
spouse. Forsythe v. Paschal, 34 Ariz. 380, 271 P. 865 (1928), see discussion of
case infra.
{20} This being a question of
first impression in this jurisdiction, counsel for appellant urges this court
to apply common law principles to the instant case, because of the 1876 statute
declaring the common law shall be the rule of practice and decision in New
Mexico. Counsel argues that the application of common law principles would
result in a finding that the husband is liable for the debts of his wife
contracted
dum sola. See, Van Maren v. Johnson, supra.
{21} Appellant further
contends that New Mexico's community property statutes were, in large part,
adopted from the California statutes then in effect. He cites the general rule
to-wit: The adoption of the statutes from another state includes prior
construction of those statutes by the courts of that state. Appellant,
therefore, urges us to follow the California decision holding that the
community property of the wife is liable for her antenuptial debts. That
argument was disposed of by this court in McDonald v. Senn,
53 N.M. 198 at 205,
204 P.2d 990 at 993-994, 10 A.L.R.2d 966 at 971 (1949), as follows:
"It is true, the New Mexico community property laws were
largely an adoption {*137} of the
California statutes. But this court has never followed the decisions of the
California courts with respect to the interests of the spouses in community
property; nor have the courts of any other state done so. This conflict of
decisions goes back to an early date."
{22} This court has held that
common law principles, which are applicable to our conditions and
circumstances, are the rule of practice and decision in New Mexico. Browning v.
Estate of Browning, 3 N.M. (Gild), 659,
9 P. 677 (1886). We have also held
that, when dealing with community property concepts, it is necessary to look to
the Spanish-Mexican law for definitions and interpretations concerning the
community estate. Beals v. Ares,
25 N.M. 459,
185 P. 780 (1919). In addition,
this court stated in McDonald v. Senn, 53 N.M. at 213, 204 P.2d at 999, 10
A.L.R.2d at 977:
"The state's public policy on the subject of community
property is expressed in the statutes, interpreted in the light of the
Spanish-Mexican law. * * *"
{23} It appears the community
property concept is unique and not part of the common law of New Mexico. We
must, therefore, reject appellant's contention that common law principles apply
and look instead to the Spanish-Mexican law.
{24} The Supreme Court of
Louisiana, in Fazzio v. Krieger, 226 La. 511 at 516-517, 76 So.2d 713 at 715
(1954), pointed out:
"* * * Research into the Spanish law of community property
reveals that since the year 1255 A.D. the Spanish law has contained the
provision that an antenuptial debt of one spouse is the liability of his
separate property alone. * * *"
We are in complete accord with the Louisiana court in the
interpretation of the Spanish law on this subject.
{25} Mr. William Q. deFuniak,
in his authoritative treatise, Principles of Community Property, Vol. I, § 158
at 442, is critical of court decisions holding the community estate liable for
the antenuptial debts of one of the spouses, and states:
"The conclusion regrettably reached from the foregoing
is that in none of the states discussed is there any clear understanding of the
true principles applicable so far as community property is concerned. But
another view exists in some of the community property states which seems to
represent a more correct understanding and proper application of the law. This
view denies any liability of the community property for antenuptial debts and
obligations of the spouses. In justification of this view it is pointed out
that the proper maintenance and protection of the family would be endangered if
the community estate and earnings could be diverted from its purpose of
insuring such maintenance and protection, in order to satisfy debts in no way
connected with the family. * * *"
We believe the view expressed by Mr. deFuniak is the better
rule.
{26} A close examination of
Forsythe v. Paschal, supra, is warranted because the facts of that case closely
parallel the instant case and call for an application of the above cited rule.
In Forsythe, the Arizona court faced the question of whether the community
property was liable for the separate debts of either spouse contracted before
marriage. As in New Mexico, Arizona had statutes governing community property,
but those statutes were silent on the question of liability of the community
for the antenuptial debts of either spouse. See, R.S.A.1913, Civil Code, PP3853
and 3854. Like New Mexico, Arizona also had a statute adopting the common law as
the rule of decision in all courts of that state. Laws of Arizona 1907, Ch. 10,
§ 8; see also, Hageman v. Vanderdoes, 15 Ariz. 312, 138 P. 1053 (1914).
{27} Two contentions raised
in Forsythe v. Paschal, supra, were argued in the instant case. First, that it
was the rule in certain other community property states, notably California and
Texas, that the community property was liable for the antenuptial
{*138} debts of either spouse. Secondly, that
the maxim of
"expressio unius est exclusio alterius" should be
applied to the statutes governing community property. It was argued that, since
the legislature expressly stated the separate property of either spouse should
not be liable for the antenuptial debts of the other and did not expressly
exempt the community estate from liability for such debts, the maxim of
"expressio
unius" implied that the community would be liable for antenuptial
debts.
{28} The Arizona court
disposed of the first contention by citing its former decisions holding that
the nature of the community property estate was based upon a different theory
than Texas and California. Consequently, decisions of those states were not
controlling in Arizona. In dealing with the contention that the maxim of
"expressio
unius" applied, the court reasoned that, though the maxim was true as
a general principle, when the public policy of the state was vitally affected
the maxim would not be applied to contradict it.
{29} The State of New Mexico
has a vital interest in the marital status. This interest is clearly expressed
in our statutory framework concerning the marital status, including its
creation, dissolution, and the methods by which the parties to the marriage can
hold property. It is this vital state interest in the marital status that
distinguishes the marriage relationship from other contractual relationships.
For a creditor of one of the spouses to be allowed to collect his debt from the
community estate would materially affect the property of the family unit, and
could ultimately undermine the marital relationship. As the Arizona court
stated in Forsythe v. Paschal, 34 Ariz. at 386, 271 P. at 867:
"* * * There are few things which would do more to
destroy the solidarity of family life and the proper maintenance of the
children of the marriage than the possibility that the community estate and
earnings primarily intended by the state for this protection could be diverted
from that purpose to satisfy debts in no way connected with the family. * *
*"
{30} This court is in full
accord with the Arizona court on this point. New Mexico's interest in the
protection of the family relationship, as expressed in our statutes, indicates
that the state deems itself an interested party when the community estate and
the marriage itself are affected. If the legislature had intended that the
community property of the marriage should be subjected to the antenuptial debts
of either spouse, it would so state. This it has not done.
{31} For this court to hold
that the community estate of Mr. and Mrs. Wiggins is liable for the antenuptial
debt of Mrs. Wiggins would be against the public policy of New Mexico.
{32} The decision of the
trial court is affirmed.
J. C. Compton, C.J., John B. McManus, Jr., J.