Lamb v. Mason

Ross, J.,

dissenting. I am unable t'o concur in the decision of this case, and have thought the question involved of sufficient practical importance to demand an expression of my views. The question for consideration is, whether a homestead which exists in an equity of redemption can be charged with its proportionate share of the mortgage in favor of a levying creditor whose debt is of that character that it cannot be levied on the homestead. The homestead exemption has been held to be humane in its character and policy, and as applying to all cases which come fairly within the spirit and equity of the statute establishing it. True v. Estate of Morrill, 28 Vt. 672; McClary v. Bixby, 36 Vt. 254. A full homestead of the value of five hundred dollars exists in premises occupied as such of which the occupant is seised of an undivided half as tenant in common. McClary v. Bixby, supra.- In the language of Kellogg, J.: The homestead right is a right to be set out of the estate of the husband or head of a family, and is treated as an exemption of so much of his estate as is included within it, for the benefit of his widow and minor children after his decease. It does not become a fixed and definite estate in the land until it is ascertained and set out. Before it is ascertained and set out, it is nothing more than a contingent or inchoate right — a conditional lien or incumbrance upon the title or estate of the husband in favor of his wife and minor children. Howe v. Adams, 28 Vt. 541; Davis & Wife v. Andrews, 30 Vt. 678. We think that it was intended by the statute that the lien or incumbrance of the homestead right should be attached to and limited by the interest of the husband in the common property, or, in other words, that it should be attached, not to the land, but *355to his estate in the land ; and that his widow and minor children are entitled to a full homestead right in his moiety or share in the common property.” The same doctrine was held in Danforth v. Beattie, 43 Vt. 138, with the addition that each tenant in common who occupied the premises for a homestead, there being two dwelling-houses upon the common premises, was entitled to a full homestead. A full homestead right exists in favor of a housekeeper or head of a family, in the equity of redemption of premises occupied as a homestead. Morgan v. Stearns, 41 Vt. 398. The doctrine of these decisions is, that the homestead right attaches to and exists, not in that specific and limited portion of the premises which may be set out to the occupying housekeeper or head of a family, when it becomes necessary to sever the homestead from the remainder of the premises,, but in the estate of such housekeeper or head of a family in the entire premises, whether it be the whole estate, or an undivided interest, or an equity of redemption ; and if such housekeeper or head of a family has an estate in such premises of the value of five hundred dollars, he is entitled to a full homestead right therein as against levying creditors who have no right to take the homestead in satisfaction of their debts. Nor are these decisions in this respect repugnant to the provisions of the statute relative to the homestead. While s. 1, c. 68, Gen. Sts., gives to every housekeeper or head of a family using and keeping premises as such, a homestead not exceeding five hundred dollars in value, exempt from attachment and levy of execution, sections 2 and 3 provide that in case of a levy of execution on the remainder of the premises, a full homestead right shall first be set out by metes and bounds, and then if the premises are encumbered by a mortgage, the “ levy shall proceed in the same manner as in the case of mortgages existing upon distinct parcels of land.” The statute has prescribed no method of procedure in the levy of an execution on one of two distinct parcels of land covered by the same- mortgage. The levying creditor in such a case, I think, can only take the right of the debtor in such parcel; that as between the mortgagor and mortgagee, the mortgagor must pay the whole mortgage before he can obtain its discharge from any portion of the mortgaged prem*356ises ; that the mortgagee would have the right to hold the whole of each distinct parcel for the payment of his whole mortgage debt. I suppose these propositions will not be questioned. How then, in the absence of any statutory provisions governing the subject, can the levying creditor take more than the right of the mortgagor in such distinct parcel ? Does he not step into the rights of the mortgagor, and must he not make his levy subject to the entire mortgage debt ? Suppose the distinct parcels of land covered by the mortgage are located, one in the town of Stannard and the other in the town of Bennington. The creditor levies his execution on the parcel in Stannard. By s. 19, c. 47, Gen. Sts., the appraisers must be three judicious freeholders residing in the town of Stannard. They are to appraise the parcel “ at its true and just value in money ” (sec. 21), and if subject to a mortgage, they are “ to state the mortgage and the sums due and growing due on such mortgage.” (Sec. 34.) There is no provision by which the appraisers from Stannard can appraise the parcel in Bennington, and apportion the mortgage between the two. Sec. 19 requires that the appraisers for the parcel in Bennington shall reside in that town. Can the appraisers on their oath do otherwise than state that the whole mortgage is on the parcel in Stannard ? I know of no other way of legally making the levy required by sec. 3 of the Homestead Act. The levying creditor, by the first section of the act, is debarred from levying on the homestead while it remains an equity of redemption, as decided in Morgan v. Stearns, supra. Was it not the intention of the act that he should be just as much debarred after the homestead is set out by metes and bounds as when resting in the whole equity of redemption ? I think that in levying on the other portion of the premises not set out as homestead, the creditor can only take the mortgagor’s rights; which is what remains after the mortgage is fully paid ; in other words, that he must assume the payment'of the entire mortgage debt. Any other construction would not only trench upon the mortgagee’s rights, but render, in part at least, the provisions of s. 9, c. 68, nugatory. That section enables a housekeeper or head of a family having a homestead, to dispose of it, and invest the proceeds in a new home*357stead, and to hold the latter exempt from attachment and levy of execution to the same extent the first one was. Suppose A now owns free from incumbrance and occupies as a homestead, premises of just five hundred dollars value. He also owes a debt of $250. His creditor cannot obtain one dollar’s interest in his homestead so long as it remains unchanged. To-morrow he exchanges this homestead for a new one of the value of $1000, giving back a mortgage for $500 to secure the payment of so much of the purchase-money. It is entirely evident that it is the intention of section 9 to enable him to hold the new homestead with the same immunity from attachment and levy of execution by his creditor that he did his first homestead. But if the creditor, in making an attachment and levy of his execution, can crowd half the mortgage over upon the homestead when set out by metes and bounds, he can secure and obtain payment of his entire debt, but he thereby diminishes the value of A’s homestead just one half. Such a construction of sec. 3 in certain cases works a practical repeal of sec. 9, as well as overrules the decisions heretofore cited, holding that the homestead right attaches to and exists in the estate of the housekeeper or head of a family in the entire premises used and kept by him as a homestead, and not in the specific portion of the same which may be set out as a homestead when it became necessary to sever the same from the remainder of the premises. Section 13 of the Homestead Act, which, under certain conditions named, provides for the sale of the premises in which the homestead right exists on the petition of a levying creditor, secures to the owner of the homestead the payment of $500, the full value of the homestead right. Section 10 of the Homestead Act renders the mortgage of the homestead by the husband, except for the purchase-money, inoperative, unless also executed by the wife; and No. 17 of the Acts of 1865, provides that such execution by the wife “ shall have no other effect than to bar her right or claim to such homestead as against such mortgage.” To my mind, all the provisions of the statute relating to the homestead, as well as the prior decisions of this court construing the same, are only consistent with awarding to the owner of the homestead right, whether existing in the fee or *358some lesser estate in the premises, a full homestead of the value of $500 whenever his interest in the homestead premises is of that value. Again, it is the manifest intention of the statute that every housekeeper or head of a family occupying premises as a homestead, should have his homestead right therein, whatever may be the kind of his estate in the premises, protected to the same extent against attachment and levy of execution, and, conversely, that the creditors of every such person should have the same and an cqnal right to secure and enforce payment of their debts against his homestead right, whether existing in the fee'or equity of redemption of the premises occupied.

The decision of the court in the case at bar, to my mind, practically repeals the various provisions of the statute, as well as the former decisions of this court which I have cited. Let us put the doctrine held to a practical test. Six housekeepers or heads of families, A, B, C, D, E, and E, each possess $500, and invest it in the purchase of premises, and occupy them as homesteads. A purchases premises of the value of $500, B of $1000, C of $2000, D of $8000, E of $4000, E of $5000. The last five respectively give back a mortgage for the balance of the purchase-money, and each subsequently contracts a debt of $500. Under the doctrine held by the court in this case, A. can hold his homestead free from attachment and levy of execution, and his creditor is remediless ; B can hold $250 of his, and his creditor can take the other $250; C can hold $125 of his, and his creditor can take the other $375 ; D can hold $83-| of his, and his creditor can take the other $416f; E can hold $62¿- of his, and his creditor can take the other $437¿-; E can hold $50 of his, and his creditor can take the other $450. I cannot yield my assent to a construction of the provisions of the Homestead Act which, in its practical application, makes the execution of a mortgage of the premises in which the right exists, whether by the husband to secure part of the purchase-money, or by the husband and wife to secure some other debt, a yielding of a part of the same to the creditors of such husband, against the plain provisions of the first section of the act, and of the act of 1865, and which makes the homestead right when existing in an equity of redemption of the value *359of |500 or more, instead of the constant and fixed value of 1500 as required, of a variable and fluctuating value, dependent upon the ratio which the value of the whole premises in which the right exists bears to the mortgage. I cannot but think that where a construction of a statute works such manifestly inequitable and unintentional results, it may safely be pronounced erroneous, and the reasoning by which it is attempted to be maintained, fallacious. The fallacy of the decision, to my mind, lies in assuming that because the orator has redeemed a mortgage which the mortgagee could have enforced against the homestead, therefore he is entitled to be subrogated to all the rights which the mortgagee had, and may also enforce it against the homestead.

I do not think that it follows that a person who is so related to the premises that he is entitled to redeem a mortgage, is therefore entitled to be subrogated to all the rights of the mortgagee in enforcing the mortgage. Whether a mortgage will be kept on foot, and to what extent, in the hands of a party who has redeemed it, is determined by the equities which attach to the mortgage in the hands of the redeeming party. Suppose premises are subject to a first and a second mortgage, and a creditor levies on the equity of redemption, and is obliged to redeem the first mortgage to prevent a foreclosure, ordinarily, equity will not keep the first mortgage on foot in the hands' of such redeeming party against the second mortgage, but treat his redemption of the 'first mortgage a payment thereof, the same as if the payment had been made by the mortgagor. So if A, being the owner of 100 acres of land, mortgages it, and then sells B the north half, on B’s agreement to pay off the entire mortgage, when B has even been compelled to pay the mortgage to save his half of the premises from foreclosure, equity will not keep the mortgage on foot in his hands, subrogate B to the rights of the mortgagee, and allow B to compel A to pay him the whole or one half the mortgage debt, or lose his half of the premises, and simply because B had no right to enforce the mortgage against A’s half of the premises. If in such case A should pay off the mortgage to save his half of the premises from being foreclosed, equity would keep the mort*360gage alive in his hands, and allow him to enforce, it in full against B’s half of the premises.

Again, A, being the owner of 100 acres of land, places it under a mortgage, and conveys by deed of warranty the north half to B ; 0, being a creditor of A’s, levies on the south half. Can there be any doubt but 0 must take the south half, burdened with the whole mortgage, and that, if he is compelled to pay the whole mortgage to save a foreclosure of his half, he cannot hold and set it up against B’s half of the premises ? I think not; and manifestly because it would be inequitable to allow him to do so, inasmuch as he would have against B only such rights as A would have had. If 0 can enforce the mortgage against B’s half under such a state of facts, a levying creditor has greater equities than a purchaser for value.

In the case at bar, the orator has no right to take the defendant’s homestead on his debts, by which alone he becomes interested in the premises. When, therefore, he compels by his levy on the equity of redemption the severance, and, so to speak, the concentration of the homestead interest, which theretofore had existed in the equity of redemption of the whole premises, into a given and circumscribed portion of the same, I think he acquires no equitable rights against the severed and specific homestead that he did not have when the homestead interest existed in the whole equity of redemption; and as he could not touch that interest when existing in the whole equity of redemption, he may not touch it now that it is severed and concentrated into a specific portion of the premises. As before the severance he could only take what remained of the premises after satisfying the mortgage and homestead interest, so now that the homestead interest is severed, he may not touch only what remains of the balance of the equity of redemption after satisfying the mortgage and homestead. Hence, by redeeming the mortgage, he only lifts the burden that, as between him and the defendant, it was his duty to lift; and it would, as I think, be inequitable, as well as work a practical repeal of the statute, and annul, in effect, the decisions cited heretofore made by this court, to allow him to set up *361and enforce any portion of the mortgage against the defendant’s severed homestead. I should reverse the decree of the Court of Chancery, and remand the case, with a mandate to dismiss the bill.

Iam authorized to say that Judge Dunton, though not a member of the court when the case was last heard, having examined it, concurs in the substance of the views I have expressed.