Opinion
No. 39926.
February 6, 1956.
1. Garnishments — statutes — assignment of future earnings by husband to wife — invalid — as against husband's creditor.
An instrument by which husband assigned to his wife all his future earnings, which was not acknowledged and not recorded in conformity with statute applicable to certain transfers between husband and wife, and of which neither judgment creditor nor garnishee had notice until garnishee was notified by counsel for wife after garnishment proceedings instituted and writ served, was invalid against judgment creditor of husband. Sec. 455, Code 1942.
Headnote as approved by Roberds, P.J.
APPEAL from the Circuit Court of Simpson County; HOMER CURRIE, Judge.
Dale McKibben, Jackson; J.W. Walker, Mendenhall, for appellant.
I. The Trial Court should not have admitted into evidence the purported assignment of funds in the hands of the garnishee.
A. The purported assignment was not admissible because it was between husband and wife and not acknowledged nor recorded. Sec. 455, Code 1942.
B. The purported written assignment should not have been admitted into evidence, because it was the sole basis of the action of the claimant, yet a copy of the same was not filed with the pleadings nor profert of it made. Lawson v. Dean, 144 Miss. 309, 109 So. 801, 110 So. 797; Secs. 1469-1470, Code 1942.
C. The purported assignment should not have been admitted, or if admitted, it should have been excluded and a peremptory instruction given, for the said assignment was clearly shown to have been made upon consideration not deemed valuable at law, and not to have been acknowledged or proved. Sec. 265, Code 1942.
II. The Trial Court should have, at the close of the testimony, excluded all the incompetent evidence and directed a verdict or given a peremptory instruction for the plaintiff.
III. The plaintiff was entitled to a directed verdict at the conclusion of the evidence; and should have a judgment in his favor in this Court, since the writ of garnishment was served on the garnishee before the garnishee had any notice of any alleged assignment of funds in his hands.
A. An assignment of funds in the hands of a third person becomes effective as to that person only after notice to the third person. Enochs-Havis Lbr. Co. v. Newcomb, 79 Miss. 462, 30 So. 608; First National Bank v. Monroe County, 131 Miss. 828, 95 So. 726; Illinois Cent. RR. Co. v. Bryant, 70 Miss. 665, 12 So. 592.
B. The answer of the garnishee admitted that he had sufficient funds of J.B. Smith in his hands at the time of the service of the garnishment to satisfy plaintiff's demand. Secs. 2797-2798, Code 1942.
C. The writ of garnishment bound the funds of J.B. Smith in the hands of the garnishee as of the date of its service, and all property that came into his hands before the return day. Brondum v. Rosenblum, 151 Miss. 91, 117 So. 363; Sec. 2796, Code 1942.
D. Notice of an assignment given to the garnishee, after the service of the writ of garnishment, comes too late to bind funds in his hands already bound by the garnishment. Enochs-Havis Lbr. Co. v. Newcomb, supra; First National Bank v. Monroe County, supra; Illinois Cent. RR. Co. v. Bryant, supra.
IV. If a married man can, with immunity, take the course of action taken to this point in this case, then there is no effective remedy by which any married man can be forced to pay a judgment. The man could, when pressed for payment, merely allow an execution, let his wife file a claimant's affidavit, bond the property and continue to use it as though it were his own, and on the trial of the claimant's affidavit produce a conveyance to the wife, undated, unwitnessed, unacknowledged, and unrecorded, of the specific property on which the levy was made, regardless of what the property might be. The creditor would have no means at his command of determining the validity of the conveyance until he was actually before a jury. This procedure could be repeated with each successive levy ad infinitum, thus effectively defeating creditors.
J.P. Edwards, Mendenhall, for appellee.
I. This gift from a husband to a wife is not covered by Section 455 of the Mississippi Code of 1942. Buckley v. Dunn, 67 Miss. 710, 7 So. 550; Dibrell v. Neely, 61 Miss. 218.
On March 18, 1954, George W. Reynolds, the appellant, obtained a judgment against J.B. Smith for $500.00, interest and costs.
On April , 1954, at the instance of Reynolds, garnishment issued on that judgment to Grady Hines, and others, doing business as Mississippi Terminix Company.
On September 11, 1954, the Terminix Company answered that it owed J.B. Smith $600.00 which he had earned as one of its employees. The garnishee also answered that it had received a letter from an attorney for Mrs. J.B. Smith that she claimed to be the owner of, and had a right to, said sum owing to J.B. Smith. The letter stated that the rights of Mrs. Smith rested upon a written instrument J.B. Smith had executed October , 1951, reading as follows:
"STATE OF MISSISSIPPI COUNTY OF SIMPSON
KNOW ALL MEN BY THESE PRESENTS, THAT I, J.B. Smith of Simpson County, Mississippi, being the lawful husband of Mrs. Mary J. Smith, do hereby assign and give to my said wife all of my future earnings from whatsoever derived, that may become due me by any and all of my future employers, and this instrument is to be the authority to demand and receive as her own any money that may hereafter arise by reason of my service rendered to any of my employers or any other source whatsoever.
Witness my signature, this the day of October, 1951.
/s/ J.B. Smith."
Reynolds attacked the validity of this instrument on the grounds (1) it had never been placed of record, as required by Section 455 Miss. Code 1942, being an attempt to transfer property from husband to wife, and (2) that it was a voluntary conveyance, without consideration, and a fraud upon the rights of creditors, and (3) that it was invalid under Section 454 of said Code, prohibiting contracts between husband and wife under which "one shall claim or shall receive compensation from the other for services rendered * * *".
Reynolds asked for a peremptory, which was refused. A jury found for Mrs. J.B. Smith, the claimant, and Reynolds appeals here.
(Hn 1) We will assume, without deciding, that this instrument is valid between J.B. Smith and his wife. However, it is not valid as against Reynolds, the judgment creditor, under Section 455, which provides that transfers of goods, chattels, lands, leases, etc., from husband to wife shall not be valid against third persons unless such transfer be in writing, duly acknowledged and recorded. It will be noted that the writing copied above was not acknowledged and not recorded, and neither Reynolds, the judgment creditor, nor Terminix, the garnishee, had notice of such document until the garnishee was notified by counsel for Mrs. Smith on June 2, 1954. Black, Todd Co. v. Robinson, 62 Miss. 68; Watkins v. Duvall, 69 Miss. 364, 13 So. 727; Snider v. Udell Woodenware Co., 74 Miss. 353, 20 So. 836; McCrory v. Donald, 119 Miss. 256, 80 So. 643; Stockstill v. Brooks, 142 Miss. 691, 107 So. 888.
Appellee relies upon Buckley Son v. Dunn, 67 Miss. 710, 7 So. 550. The case is not in point here. It did not involve said Section 455, requiring transfers from husband to wife to be acknowledged and recorded. In the Buckley case all of the business was done by the husband as agent of the wife. This was a venture under which the husband, expressly as agent of the wife, bought, cut and sold crossties to a railroad, the money for which being advanced by Buckley. It involved no transfer of property by the husband to the wife.
Reversed and remanded for entry of judgment in the lower court in favor of appellant and against the garnishee not to exceed $600.00, amount admitted by garnishee to be owing to J.B. Smith.
McGehee, C.J., and Hall, Lee, Ethridge, Arrington, and Gillespie, JJ., concur.