Smith v. Smith , 249 N.C. 669 ( 1959 )

107 S.E.2d 530 (1959) 249 N.C. 669

Helen W. SMITH, Petitioner,
v.
John B. SMITH and Minnie M. Smith, Defendants.

No. 172.

Supreme Court of North Carolina.

March 18, 1959.

Max L. Childers, Henry L. Fowler, Jr., Mount Holly, and Hugh W. Johnston, Gastonia, for plaintiff, appellant.

Ernest R. Warren and Julius T. Sanders, Gastonia, for defendants, appellees.

MOORE, Justice.

Before reaching the main question involved, it is thought advisable to dispose of two preliminary matters.

1. The plaintiff did not file a reply and did not plead as an estoppel the admission of the defendant John B. Smith in his answer in a former suit for alimony, that he and plaintiff owned the locus in quo as tenants by the entireties.

"An estoppel is new matter and must generally be pleaded as a defense, and no advantage can be taken of it under a general denial; and this applies to estoppels by record or judgment, estoppels by deed, and estoppels in pais, or equitable estoppels. ``An estoppel which "shutteth a man's mouth to speak the truth" should be pleaded with certainty and particularity. The court should be able to see from the pleadings what facts are relied upon to work the estoppel.' When a party has an opportunity to plead an estoppel, and omits to do so, he waives the benefit of it; * * * if the party seeking the benefit of the estoppel will not rely upon it, he will answer to the fact and again put it in issue, the estoppel, when offered in evidence to the jury, loses its conclusive character, becomes mere evidence and like all other evidence may be repelled by opposite proof, * * *" McIntosh, North Carolina Practice and Procedure (Second Edition), Vol. 1, Sec. 1236(7), pp. 673, 674. Miller v. New Amsterdam Casualty Co., 245 N.C. 526, 96 S.E.2d 860; Wilkins v. Suttles, 114 N.C. 550, 19 S.E. 606.

2. The defendants alleged in their further answer the mere conclusion that plaintiff's name was inserted in the deed from Minnie M. Smith "through error." Such allegation is insufficient to support a reformation of the deed for mutual mistake of fact, for the mistake on one part and fraud on the other, or for mistake of the draftsman.

"The party asking for relief, by reformation of a deed or written instrument, must allege and prove, first, that a material stipulation, as alleged, was agreed upon by the parties, to be incorporated in the deed or instrument as written; and, second, that such stipulation was omitted from the deed or instrument as written, by mistake, either of both parties, or of one party, induced by the fraud of the other, or by the mistake of the draftsman. Equity will give relief by reformation only when a mistake has been made, and the deed or written instrument, because of the mistake, does not express the true intent of both parties. The mistake of one party to the deed or instrument alone, not induced by the fraud of the other, affords no ground for relief by reformation." Crawford v. Willoughby, 192 N.C. 269, 271, 134 S.E. 494, 495.

"The answer must contain any new matter relied on by the defendant as constituting an affirmative defense. [G.S. § 1-135.] Setting forth new matter as a defense is an affirmative pleading on the part of the defendant and the facts should be alleged with the same clearness and conciseness as in the complaint." Cohoon v. Swain, 216 N.C. 317, 320, 5 S.E.2d 1, 3; McIntosh, North Carolina Practice and Procedure (Second Edition), Vol. 1, Sec. 1236, p. 668.

The main question involved on this appeal is whether or not the plaintiff was a tenant in common with the defendants in the 7.14 acre tract described in the petition at the time of the institution of the proceeding. Smith v. Smith, supra.

If the deed from Minnie M. Smith to J. B. Smith and wife, Helen W. Smith, vested in the grantees an estate by the entireties, the answer is that she was a tenant in common at the time the proceeding was instituted. Plaintiff and John B. Smith were divorced 3 November, 1955. "An absolute divorce destroys the unity of husband and wife and therefore converts an estate by the entirety into a tenancy in common." Davis v. Bass, 188 N.C. 200, 207, 124 S.E. 566, 570.

In order to determine the intent and effect of the deed from Minnie M. Smith to John B. Smith and wife, Helen W. Smith, it must be considered in conjunction with the deed from John B. Smith and wife, Helen W. Smith. These deeds together constitute a "simultaneous transaction." All instruments executed at the same time and relating to the same subject may be construed together in order to effectuate the intention. Sandlin v. Weaver, 240 N.C. 703, 83 S.E.2d 806; Howell v. Howell, 29 N.C. 491.

In construing a deed and determining the intention of the parties, ordinarily the intention must be gathered from the language of the deed itself when its terms are unambiguous. However, there are instances in which consideration should be given to the instruments made contemporaneously therewith, the circumstances attending the execution of the deed, and to the situation of the parties at the time. "* * * it is an elementary rule of construction that the intention of the parties shall prevail, unless it is in conflict with some unyielding canon of construction or settled rule of property or is repugnant to the terms of the grant. Such intention as a general rule must be sought in the terms of the instrument; but if the words used leave the intention in doubt resort may be had to the circumstances attending the execution of the instrument and the situation of the parties at the time, the tendency of modern decisions being to treat all uncertainties in a conveyance as ambiguities to be explained by ascertaining in the manner indicated the intention of the parties." Seawell v. Hall, 185 N.C. 80, 82, 116 S.E. 189, 190. See also Monk v. Kornegay, 224 N.C. 194, 29 S.E.2d 754.

The practical construction placed upon a written instrument by the parties thereto before the controversy arose is ordinarily given great weight by the courts in arriving at the true meaning and intent of the language employed in the contract. Banks v. Tennessee Mineral Products Corp., 202 N.C. 408, 163 S.E. 108.

"A conveyance of land must be in writing and comply with certain formalities, and its principal function is to evidence the transfer of a particular interest in land. * * * an agreement which contradicts express provisions of the deed * * * which ``would change the essential nature' of a deed absolute, may not be shown." Stansbury, North Carolina Evidence, Sec. 255, pp. 512 and 514. The Parol Evidence Rule applies in litigation involving the construction of the nature and quality of estates conveyed by deed. Heaton v. Kilpatrick, 195 N.C. 708, 143 S.E. 644; Flynt v. Conrad, 61 N.C. 190. A conveyance cannot be contradicted by a parol agreement, nor, in the absence of proof of fraud, mistake, or undue influence, can a deed solemnly executed and proven be set aside by parol testimony. Walters v. Walters, 172 N.C. 328, 90 S.E. 304; Lytton Mfg. Co. v. House Mfg. Co., 161 N.C. 430, 77 S.E. 233. "It is well-nigh axiomatic that no verbal agreement between the parties to a written contract, made before or at the time of the execution of such contract, is admissible to vary its terms or to contradict its provisions. (Citing authorities) As against the recollection of the parties, whose memories may fail them, the written word abides. (Citing authority) The rule undoubtedly makes for the sanctity and security of contracts." Jefferson Standard Life Insurance Co. v. Morehead, 209 N.C. 174, 175, 183 S.E. 606, 607, and cases there cited.

"Where facts are found by the court, if supported by competent evidence, such findings are as conclusive as the verdict of a jury." (Emphasis ours.) City of Goldsboro v. Atlantic Coast Line R. Co., 246 N.C. 101, 97 S.E.2d 486, 491. In the instant case, the declaration of the parties after the controversy arose and their testimony as to their intentions with respect to the effect of the deeds and the estates thereby created, may not be considered in so far as such tend to contradict the plain provisions of the deeds themselves. The deeds, the circumstances attending the execution thereof, and the situation of the parties at the time are to be considered.

The question of "consideration" is unimportant in this case. A close blood relationship constitutes a good consideration for conveyance of land. And a deed in proper form is good and will convey the land described therein without any consideration, except as against creditors or innocent purchasers for value. Little v. Little, 205 N.C. 1, 169 S.E. 799; Exum v. Lynch, 188 N.C. 392, 125 S.E. 15; Howard v. Turner, 125 N.C. 107, 34 S.E. 229.

The following facts are important in the decision of this case. Minnie M. Smith and John B. Smith are mother and son. Prior to the execution of the deeds in question they were owners in fee and tenants in common of the tract of land of which the locus in quo was a part, and Minnie M. Smith had a dower right in the one-half undivided interest of John B. Smith. The deeds were made less than two months after the marriage of John B. Smith to the plaintiff. Minnie M. Smith had been in possession of the entire tract of land prior to the execution of the deeds. John B. Smith and wife, Helen W. Smith, conveyed the entire tract of land to Minnie M. Smith. And thereupon Minnie M. Smith conveyed 7.14 acres thereof to John B. Smith and wife, Helen W. Smith. The deeds were dated, executed and filed for recordation simultaneously. The deed to Minnie M. Smith appears first in the registry, and the deed to John B. Smith and wife, Helen W. Smith, follows immediately.

Where a conveyance of land is made to a husband and wife, nothing else appearing, it creates an estate by the entireties. Davis v. Bass, supra.

But the defendants contend that the deeds in question in this case were for the sole purpose of partitioning the tract of land owned by them as tenants in common, created no new title, and had the effect only of severing the unity of possession.

This Court has consistently held that where tenants in common divide the common land and by exchange of deeds allot to each his or her share of the land, the deeds employed create no new title and serve only to sever the unity of possession. And if any of such deeds names the tenant and his wife or the tenant and her husband as grantees, no estate by the entireties is thereby created, even if they are so named with the consent of the tenant. The grantees must be both jointly named and jointly entitled. Elledge v. Welch, 238 N.C. 61, 76 S.E.2d 340; Duckett v. Lyda, 223 N.C. 356, 26 S.E.2d 918; Wood v. Wilder, 222 N.C. 622, 24 S.E.2d 474; Burroughs v. Womble, 205 N.C. 432, 171 S.E. 616; Crocker v. Vann, 192 N.C. 422, 135 S.E. 127; Garris v. Tripp, 192 N.C. 211, 134 S.E. 461; Speas v. Woodhouse, 162 N.C. 66, 77 S.E. 1000; Sprinkle v. Spainhour, 149 N.C. 223, 62 S.E. 910, 25 L.R.A.,N.S., 167; Harrison v. Ray, 108 N.C. 215, 12 S.E. 993, 11 L.R.A. 722. In the instant case, if Minnie M. Smith and John B. Smith had exchanged deeds and each had conveyed to the other thereby a moiety of the land, the controlling principle would be clear.

A partition deed assigns to the heir or co-tenant only what is already his. He acquires no title to the land by such deed. He already has title by inheritance from the ancestor or by the deed of conveyance to the tenants in common. The partition deed merely fixes the boundaries to his share that he may hold it in severalty. If the partition deed is made to co-tenant and spouse, there is created no estate by the entireties. There is no unity of time and title, and the grantees are not jointly named and jointly entitled. "When coparceners mutually agree to, and do voluntarily, divide an estate held by them in common, and assign to each his or her share therein, it is obvious that they convey nothing of their own to such coparcener, but merely designate the boundaries in severalty to that which was already his or her own by virtue of the joint deed, or by descent from the common ancestor." Snyder v. Elliott, 1902, 171 Mo. 362, 71 S.W. 826, 828; 132 A.L.R. 638.

We should consider what is meant by the expression "jointly entitled." It cannot be construed to mean that both the husband and wife had paid a substantial and valuable consideration for the conveyance, nor that both of them, jointly or individually, had some equity, right, title, interest, or estate in the land before the conveyance was made. Where a husband owns land and conveys it to a third party (strawman) who in turn conveys it to said husband and his wife, such conveyance creates an estate by the entireties. 132 A.L.R. 641 and cases there cited, and 173 A.L.R. 1219 and cases there cited. Indeed, this is the device customarily used in creating such an estate in land owned by one spouse, when it is desired that it be held by the entireties. Conveyance to a trustee for the benefit of husband and wife creates an estate by the entireties. Akin v. First Nat. Bank, 227 N.C. 453, 42 S.E.2d 518. It was held in Woolard v. Smith, 244 N.C. 489, 94 S.E.2d 466, that a husband owning land may create an estate by the entireties by deeding the land to himself and wife. If one tenant in common conveys his share to another tenant in common and the wife of the other tenant in common, the grantees hold such share as tenants by the entireties. Morton v. Blades Lumber Co., 154 N.C. 278, 70 S.E. 467. In none of such cases is there a requirement that the wife pay consideration or that she own some pre-existing right in or to the land.

"In its usual sense, to entitle is to give a right or title." Black's Law Dictionary. It comes to this: Were the instruments in question capable, by their nature and under the circumstances existing at the time of their execution, of passing a new title or creating a new estate? The answer is yes. The deeds are silent with reference to any partition of land; there is no indication of the relative values of the tract conveyed and the tract retained by Minnie M. Smith. The deed to Minnie M. Smith conveys the entire tract. At this point she is the sole owner in fee of the entire tract. She could have conveyed title to a part or all of it to anyone. The conveyance from her was accepted by John B. Smith as written, so far as the record is concerned, without question until this controversy arose. Minnie M. Smith was in a position comparable to that of the mother in Edwards v. Batts, 245 N.C. 693, 97 S.E.2d 101. She had title to the land and conveyed it to John B. Smith and wife, Helen W. Smith, "Creating an Estate by the Entirety." The plaintiff and John B. Smith were "both jointly named and jointly entitled." We find nothing in the circumstances surrounding the execution of the deeds or in the situation of the parties at the time inconsistent with our conclusion that it was the intention of the parties to create an estate by the entireties in John B. Smith and wife, Helen W. Smith. The pertinent and competent facts bearing upon the situation tend to support our conclusion as to the intention of the parties.

The authorities in other jurisdictions are not in accord.

In Dixon v. Becker, 1938, 134 Fla. 547, 184 So. 114, 116, 132 A.L.R. 640, there was an agreement to partition deceased's property between his only heirs, a son and daughter. The daughter conveyed her undivided half interest in a portion of the land to the son, and the son conveyed to the daughter and her husband the other portion of the land, in which the daughter already had an undivided half interest. The court held that as to the one-half undivided interest conveyed by the son there was a tenancy by the entireties. The court, in explanation of its decision said: "* * * the record shows that it was her intention to take as much of the estate as she was in position to take as an estate by the entireties."

In Powell v. Powell, 1916, 267 Mo. 117, 183 S.W. 625, 627, 188 S.W. 795; 132 A. L.R. 639, decedent's heirs, to effect a partition of his land, executed deeds to his widow, who simultaneously executed deeds back to each heir for his or her share of the land. The deed, for a daughter's share, at her direction, was made to herself and husband. There were four heirs involved. The court held that no estate by the entireties was created. The court said: "It is clear that the mother * * * was selected as a mere conduit in their partitioning of the estate * * *. It is also clear that the land conveyed to defendant and his wife was the portion of her father's estate coming to her and no more."

It is clear in such cases that the courts look to the intention of the parties as disclosed by their situations at the time, the facts and circumstances surrounding the execution of the deeds and the facts to be drawn from the deeds themselves.

If the defendant, John B. Smith, could convey to a third party and create an estate by the entireties by accepting a deed to himself and wife, from the third party, we see no reason why this third party could not be his mother in this case. She was vested with the entire title. She conveys what was clearly intended as an estate by the entireties. Under this deed the grantees were jointly named and jointly entitled and the unities of time and title appear.

The plaintiff now owns a one-half undivided interest in fee in the locus in quo as a tenant in common with John B. Smith and is entitled to maintain her proceeding for partition.

The legal status of the purported life estate of Minnie M. Smith in the house and lot is not before us. However, attention is called to the principles enunciated in the following cases: Burns v. Crump, 245 N.C. 360, 95 S.E.2d 906; Edwards v. Butler, 244 N.C. 205, 92 S.E.2d 922; Hardison v. Lilley, 238 N.C. 309, 78 S.E.2d 111; Whitson v. Barnett, 237 N.C. 483, 75 S.E.2d 391; Jeffries v. Parker, 236 N. C. 756, 73 S.E.2d 783; Kennedy v. Kennedy, 236 N.C. 419, 72 S.E.2d 869; Swaim v. Swaim, 235 N.C. 277, 69 S.E.2d 534; Pilley v. Smith, 230 N.C. 62, 51 S.E.2d 923; Artis v. Artis, 228 N.C. 754, 47 S.E.2d 228; McNeill v. Blevins, 222 N.C. 170, 22 S.E.2d 268.

The judgment below is reversed and the cause is remanded for further proceedings in accordance with law and the decision in this case.

Reversed and remanded.