Estate of Hauer

Opinion,

Mr. Justice McCollum:

The single question presented by this appeal is whether a wife, who for a period of ten years or more permits her husband to receive and use as his own the rents of her separate property, can, at his death, recover them from his estate, without proof of an understanding that he should account for them.

It is well settled that a husband, who receives any portion of the principal of his wife’s separate estate, becomes, in the absence of an agreement controlling his reception of it, her debtor for the amount so received, but he is not, as a general rule, chargeable with interest upon it. It lies on him to show the agreement which relieves him from the payment of the principal, and on her to show the agreement which entitles her to interest, but the agreement, in either case, may be implied from the circumstances attending the transaction. Prior to the act of April 11, 1848, P. L. 536, a husband was not required to account to his wife or her legal representatives for the rents of property settled to her separate use, if he received them with her knowledge and approval, and without any understanding that he should hold them in trust for her. In such case, the presumption was that the rents were used in the maintenance of the family, and that the wife intended a gift of them to the husband for that purpose.

In McGlinsey’s App., 14 S. & R. 64, Chief Justice Tilghman said: “ It is a general principle, that where the wife permits her husband to receive the profits of her separate estate, and particularly where they live together, and the expenses of housekeeping are paid by him, the presumption is that it was the intention of the wife to make a gift of the profits to the husband. And there is great reason for this presumption, because the husband, being in receipt of this money, may be induced to live at a greater expense than he would otherwise have done, whereby the comforts of his wife as well as his own are increased. To call him to account, therefore, after the lapse of a number of years, might be ruinous, and would certainly be unjust.” The law on this subject was clearly stated by Mr. Justice Kennedy, in his charge at Nisi Prius in Towers v. Hagner, 3 Wh. 48, as follows: “ Now, according to the legal effect of the agreement made between Capt. Towers and his wife, .... Mrs. Towers continued to be the owner in equity of her estate, the same after marriage as before. Her husband had no right whatever to her money, nor to the rents or profits of her real estate; all still belonged to her, and she had an unquestionable right to dispose of them as she pleased. .....If Capt. Towers received any of her rents without her consent or authority, he would be bound to account for it, and pay it to her. If, however, he received her rents by and with her consent, while they lived together in peace and harmony, and used them without any complaint or objection being made by her for years, the presumption would be that such rents, so received, were a gift from her to him; and, if so, his estate would not be accountable. This same rule would also apply to the receipt of interest on money belonging to her, and standing out upon loan.” The portion of the charge we have quoted was approved by the court in banc, and the principles announced in the cases cited have not been disputed by any decision of this court before or since the act of April 11, 1848.

There is no foundation in reason for a different rule respecting rents of property settled to the separate use of the wife, and the rents of her separate property held under that act. The circumstances which create the presumption of a gift to the husband of the rents in the former case, will accomplish the same result in the latter. But a broad and plain distinction is drawn by the cases between the receipt by the husband of the income of his wife’s separate property and the receipt by him of the principal or corpus of her estate. A gift of the income may bo implied from his receipt of it with her consent, but a gift of the principal will not be presumed from her mere acquiescence in his receipt and use of it. This distinction will be observed in the decisions which allow her to recover the corpus, but deny her compensation for the use of it, unless there is either an express or implied undertaking by the husband to pay interest or rent. The distinction rests, in part at least, upon the fact that income is usually applied to the maintenance of the family, while the effort in every well-regulated household is to preserve the principal intact. A wife may well consent that the income of her separate estate shall enter into a common fund for family uses, and object to an appropriation of the principal of it for that purpose. The living expenses of the family are materially affected by its income, without regard to the source of it; and, if the wife permits the husband to receive and apply to these expenses the rents of her separate property, the fair inference is that she intends a gift of them to him, and she will not be allowed to reclaim them from him or his estate. It would be manifestly unjust to require him to account for them, when he had received and expended them with her knowledge and approval for their joint benefit. It was said by Lord McNaughten, in Edwards v. Cheyne, L. R. 13 App. Cas. 385, after a careful review of the English cases on this subject, that “ the rule in equity is clear, from the earliest times, that where the husband and wife have lived together, the wife cannot charge her husband, or her husband’s estate as her debtor for arrears of her separate income which she has permitted him to receive. The object of the rule, according' to Lord Hardwicke, was ‘ to prevent such accounts between husband and wife, which it is impossible to determine according,to their rights after the death of the parties.’ .... Where the circumstances are such that the wife’s consent or acquiescence may fairly be presumed, the presumption arises immediately on each receipt by the husband, and bars all claim on the part of the wife or her representatives.” In re Flamank, L. R. 40 Ch. Div. 461, Kay, J., said: “ It has always been held that while a husband and wife are living together in perfect comity, as these were, the receipt by the husband of the separate income of the wife may be treated as a gift of that separate income to him, to be applied for the joint benefit of himself and his wife, as for the maintenance of their household and the like.” An express consent or acquiescence of the wife need not be shown. It will be implied from circumstances and a course of life consistent with it, and opposed to any other conclusion.

In the case before us, the appellee received during coverture a conveyance of a hotel property in Marietta, but whether she had a separate estate from which she paid for it, or it was a gift to her from her husband, the record does not disclose, nor is it material. The husband paid the insurance and taxes and made repairs and improvements on the property, and he received and used the rents of it without objection from his wife. No account of rents and expenditures was kept by either. They dwelt together in harmony, and neither supposed that the relation of debtor and creditor existed between them respecting the income of the wife’s separate estate. A short time before his death, the husband purchased, in the name and for the benefit of his wife, a house and lot for which he paid the sum of $1,825. This transaction, as explained by the husband, constituted a gift to the wife of the property so purchased, and evinced affectionate solicitude for her welfare and comfortable maintenance. It was not the act of a debtor towards his exacting creditor, and it was not consistent with that relation. It is apparent, from the evidence produced by the appellee for the purpose of showing that this transaction was a gift to her from her husband, that he did not regard himself as her debtor for the rents of her separate property which he had received and used for their mutual benefit and support; nor do we find on this record any act or declaration of the wife manifesting disapproval of his appropriation of the rents, or indicating a purpose on her part to charge him with them. There is certainly no evidence that she entertained such a purpose while he was living. The first demand for an account came after his death, and it was then that she took the position that, as to the rents of her separate property received by him without objection from her, he was her debtor, and as to the property she received from him she was his donee. The learned auditor sustained this position, and allowed her the rents, less the expenditures it was shown the husband had made for repairs and improvements, insurance and taxes. This allowance was placed distinctly upon the ground that there was no express or direct proof that she acquiesced in the husband’s receipt of them. But, as we have already seen, this is not necessary. It sufficiently appears that she knew that he rented the property, and must have known that he was paid for its use. The circumstances admit of no other conclusion. If she was not willing that he should receive the rents, she could easily have prevented it by a notice to the tenant. Her acquiescence is shown in her failure to do so, or to make any objection to the husband’s action. It follows from the principles already considered that a gift of the rents to him was intended by her, and that she cannot now require his estate to account for them. If there are no other demands against the fund, it should be distributed to the widow and next of kin under the intestate laws.

Decree reversed, and record remitted for further proceedings in accordance with this opinion; the costs of the appeal to be paid by the appellee.