Jensen v. Griffin , 32 S.D. 613 ( 1913 )

WHITING, P. J.

This action was brought for the purpose of foreclosing a mechanics’ lien against -certain real estate owned by defendants Griffin, being lots 1 and 2 of a certain city block. McCullough was made a party defendant owing to the fact that he was the holder of a mortgage against said real esate, which mortgage plaintiff -sought to have decreed to be a lien subsequent and inferior to his; his- rights depend upon those of the other two respondents and no separate mention of same will be made herein. The word “respondents,” when used in this decision, will be understood to refer to the Griffins only, unless otherwise noted. The other defendants were joined owing to the fact that they also were mechanics’ lien claimants, claiming liens on the same property, and they have become appellants herein. The trial court found that respondents were husband and wife; that, for several years prior to the dates hereinafter mentioned, they had, with their minor children, occupied, as their homestead, the premises in question; -that the said lots are less than one acre i'n area and, with all the buildings and improvements thereon, do not exceed $5,000 in value; that prior to October, 19x0, the improvements on said lots consisted of a small house built some 28 years prior thereto and not exceeding $200 in value, located on lot 2, a small barn on lot 1, moved thereon in October, 1910, but before the commencement of the building of the dwelling house hereinafter mentioned, and a well located on said lot 1-; that -said house, because of its age and condition, was not a fit dwelling house for respondents and their family; that the said -house on lot 2 and barn and well on lot i had been used together 'by respondents as their homestead, and for eight years prior to the filing of the mechanics’ liens herein, said premises had not been used by any other person or persons for any purpose -other than as the homestead of respondents; that respondent Richard Griffin had, for several years preceding the year 19x0, purchased lots in said city and erected- dwelling houses thereon for rental and for the purpose of sale; .that about October, 1910, said Richard Griffin began the erection of a dwelling house on lot x and during the construction of the same, procured' labor and material used in such- construction, and which has- not been paid for, from the several appellants in the amounts for which they cl-aim mechanics liens herein; that said Richard Griffin at that time held the legal -title to said lots; that the contracts for materials, supplies, and labor used in -the construction of said dwelling house were the sole and individual contracts of the respondent Richard Griffin with the said mechanics’ lien claimants and were not the -contracts of his wife, and that she is in no manner liable to said mechanic’s lien claimants upon s-aid contracts-; that Mrs. Griffin -was at the new house practically every day of its construction, knew where the materials were purchased, • and dictated some changes in the plan of the house; that, at various times while the said dwelling house was in the course of construction, respondent Richard Griffin offered the same for sale, the last -time being when the hou-se was near completion; that mechanics’ liens were in due form filed -by the several claimants; ¡that, when the respondent Richard Griffin began the erection of said dwelling house, he was without sufficient means to pay for the la-b-or and material to be used in- the construction thereof and had made no arrangements for the funds for such purpose; that the respondents continued to reside in the house upon lot 2 until the spring of 1911 when they moved into-the house on lot 1, beginning to -move their furniture therein prior to the filing of the liens -herein and moving therein with the intention of occupying such house as a domicile; that about May 1, 1911, being ¡mediately after the completion of said new house on lot 1, the respondents vacated the house o-n lot 2 and took up their, permanent -dwelling ip-lace in the new 'house and have ever since -continued to reside therein; that thereafter the house on lot 2 was occupied by a tenant for some five weeks but 'has since remained unoc'cupied. The above are the only findings material to a proper consideration of this appeal. From' the above facts the court found and decreed that the several claimants were entitled to personal judgments against Richard Griffin hut that they were not entitled to mechanics’ liens against said new dwelling and the lot upon which it is situate because the said dwelling and lot was the homestead of the respondents. Were the above findings sufficient to support the said decree; there being no finding that respondents, at the time of the purchase of the building material, intended to use the new dwelling as their home?

Respondent urges that: “The assignments of error are not sufficient to present any question to this court. * * * The first five are defective in that they wholly misquote the several conclusions of law to' which they refer. * * * The * * * [other] assignments * * * are insufficient for the reason that they fail to point out the particulars of the errors assigned.” The assignments last referred to are clearly not subject to the objection raised.

[1] In making each of the first five assignments the appellant referred by number to the “conclusion” excepted to and followed such reference with a purported copy of such conclusion. It appears that, through some one’s oversight, instead of copying the proper “conclusion” there was copied, as a part of each assignment, the same numbered “finding.” This is too apparent to be misleading, and respondent should not be heard to complain thereof.

[2] It seems to be conceded by both parties that' the creation or existence of a homestead depends largely upon the intent of the parties. This is certainly true in those jurisdictions where, as in this state, the statute is so liberally construed- as not to require actual present occupancy of the premises in order that they may become the homestead of the owner. Kingman v. O’Callaghan, 4 S. D. 628, 57 N. W. 912; Cameron v. Gebhard, 85 Tex. 610, 22 S. W. 1033, 34 Am. St. Rep. 832; Wolf v. Butler, 8 Tex. Civ. App. 468, 28 S. W. 51; Foley v. Holtkamp, 28 Tex. Civ. App. 123, 66 S. W. 891; Davis v. Kelly, 62 Neb 642, 87 N. W. 347. Respondents in their brief say, “If the new house is constructed with the intent of using it as a 'second dwelling upon the property, then we agree with appellants’ counsel that both houses can’not be ’homestead property;” but they insist that no question of intent is 'before us because: This (intent) was a question for the trial court and it has been decided by the trial court in favor of the respondent's.” Herein respondents are in error. Aa before noted, an examination of the findings of the trial court reveals the fact that «said court wholly failed to find the owners’ intent when building the new dwelling. There is one fact from which, if it were not for the other facts found, an intent to- abandon the old building for dwelling purposes anight possibly be inferred, namely, the fact that the old house was unfit for a home; but there is no finding that the owner thought it unfit and there are findings that they continued to live there until they moved into the new house and they rented -the old house for others to live in. These facts certainly indicate an intent’ to use both buildings for dwellings, at least ■for a time; and, when we consider the further finding tlhhit Griffin was engaged in the business of building houses to- sell and tried to sell the new house, there 'can certainly, -from all the facts found, be no inference that respondents built this dwelling intending to use it as their home without which intent the building could not become a homestead prior to actual occupancy.

[3] If respondents’ rights depend upon the total abandonment of the old building for dwelling purposes, such abandonment, if it ever occurred, took place long after appellants’ liens had attached, and no abandonment after that time could be of any effect as against such liens; if their rights depend upon their abandonment of the old building as their dwelling place, even then such abandonment did not occur until long after appellants had furnished the material and done the work that gave them liens upon the new building, which liens could not be affected by any abandonment occurring thereafter.

[4-5] But respondents urge that, even if .there was no' abandonment of the old house as a dwelling house and there were therefore two dwelling houses on their property, they yet, under section 3222, Pol. Code, had a right to and did select the new house as their 'homestead. Section 3222 reads as follows: “The homestead must embrace the house used as a home by the owner thereof, and if he or she has two or more houses thus used at different times and places, such owner may select which he or she will retain as a homestead.” Conceding that respondents, did have the right to and did select the new house as their dwelling, yet the findings fail to advise us as to when they made this selection. If not until after the contracts with appellants were made and the materials and labor furnished thereunder, then such selection came too late as against appellants, as the mental selection (the intent) must exist in order to give a homestead character to a dwelling house either erected or to be erected; if such selection had not been made (such intent had not come into1 existence) when the material and labor were contracted for, then, unless such intent came into existence after such contracts and was communicated to appellants before they furnished the materials and labor, upon furnishing same liens would attach in their favor. That such an intent is necessary in order to give to a dwelling house the homestead character is beyond all question. Betcher Co. v. Cleveland, 13 S. D. 347, 83 N. W. 366. If upon a new trial it should be established that the selection was made prior to such contracts or prior to the furnishing of materials and labor thereunder, then what notice was given to the world, and especially to these appellants, that respondents intended the new house for their dwelling place and had selected the same as their homestead? Certainly no construction should be placed upon our homestead law that will permit. it to be used as an instrument through which a palpable fraud may be committed against a party relying upon conditions as they exist when they contract with the homestead claimant. The head of the family has the right and power, when acting in good faith toward the family, to diminish the extent of the homestead by using a part thereof as the site for another dwelling to be sold or rented. Wynne v. Hudson, 66 Tex. 9, 17 S. W. 110; Geney v. Maynard, 44 Mich. 578, 7 N. W. 173. Griffin was apparently exercising this right and power with the knowledge and consent of his wife. O’Brien v. Woeltz, 94 Tex. 148, 58 S. W. 943, 59 S. W. 535, 86 Am. St. Rep. 829. What was there to notify appellants that these respondents contemplated changing their home from the old dwelling place? While it must be conceded that the fact that the building was being erected upon land forming a part of the then homestead would ordinarily be sufficient to put contractors upon inquiry, yet here was a party who was in the business of erecting houses to sell and who was not financially able to build this house and pay for same without selling it. While it is important that .the homestead right be protected, it is even more impo-rant that the - homestead right be not used as an instrument of fraud. To -defeat appellants’ liens it should appear that respondents formed the intent and made ¡the selection 'before appellants entered upon these contracts and furnished materials and -did labor thereunder. Even then the liens should be upheld if it appears that by their conduct respondents led the contractors to believe that this building was not to be used as their home. Wolf v. Butler, supra; Foley v. Holtkamp, supra. Respondents, abandoning all other contentions, and in the face of their concession above referred to, namely: “ If the new house is -constructed with the intent of using it as a second dwelling upon the property, then we agree with appellants’ counsel that both houses cannot be homestead property” — cite Lubbock v. McMann, 82 Cal. 226, 22 Pac. 1145, 16 Am. St. Rep. 108, wherein the court held that, after a tract of land with a residence thereon had become a homestead, the,owner was at liberty to erect a second dwelling house thereon and the whole would still remain a homestead.

[6] We would- refuse to follow thi's opinion if we did not believe the express provisions of our statute (section- 3225, Pol. Code) forbids .the rule -therein laid down. An examination of the dissenting opinion written therein and of the real question before that court revealed by the “opinion of department 1” referred to in the majority opinion reveals to our mind that the majority opinion is unsound in principle as well as but obiter dictum upon the proposition for -which respondents have cited it as an authority. The rule laid down in Re Liggett, 117 Cal. 352, 49 Pac. 211, 59 Am. St. Rep. 190, should prevail where a'second dwelling house is erected after a homestead is established the same as where the two dwellings are in existence when homestead is first claimed.

Summarizing we would say: -While section 32-22, supra, provides that the homestead “must embrace the -house used as a home,” this section should be given a liberal construction in favor of the homestead right, so that one may even claim vacant land as a homestead when he has a 'bona fide intent of erecting his family dwelling h-p-use thereon and such intent is seasonably disclosed to those who have a right to know of the same and to- rely thereon. Said section should be so construed that one, occupying a building as his homestead, may still elect, subject to the conditions above specified, to- select a vacant piece of land for a homestead, be that land separate and 'distinct from the former homestead or be it but a part of the former homestead. Under the provisions of section 3225, Pol. Code, which reads as follows: “It must not embrace more than one dwelling house or any other buildings except such as are properly appurtenant to the homestead as such; but a shop, store or other building situated thereon and really used or occupied by the owner in -the prosecution of his own ordinary business may be deemed appurtenant to such homestead'’ — one cannot claim more than one dwelling house as a homestead (except, perhaps, in a case where two buildings are actually used together at one and the same time as a home); but this should not prevent a party, upon giving .proper notice of his intention, from electing to- and from claiming all the former homestead together with the new building, either erected or to be erected, providing the old 'building Is to be used in good faith as a part of the dwelling house or, upon occupancy of the new dwelling, is to be entirely abandoned as a dwelling and to become but one of the outbuildings used in connection with the homestead; but as was said in McMonegal v. Wilson, 103 Mich. 264, 61 N. W. 495, a case quite analogous to this case: “No such liberality of construction of the homestead law is permissible as will. entitle the party to two homesteads at the same time,' the one actual and the other potential.” Measured by these rules the findings are insufficient to- support the decree appealed from. It may be that, upon a new trial, the respondents may be able to supply proof of the existence of the missing links that are wanting in the court’s present findings.

The decree appealed from is reversed as to all the respondents.