Opinion
No. 5-862 / 05-0101
Filed December 21, 2005
Appeal from the Iowa District Court for Appanoose County, Annette J. Scieszinski, Judge.
Bobby D. Martin II appeals from the district court's ruling holding both parties had an interest in a plot of land and directing that the property be sold. REVERSED AND REMANDED.
Cathleen J. Siebrecht of Siebrecht Siebrecht Law Firm, Des Moines, for appellant.
Greg A. Life of Life Law Office, Oskaloosa, for appellee.
Heard by Huitink, P.J., and Mahan and Hecht, JJ.
Bobby D. Martin II appeals from the district court's ruling holding that he and his father, Bobby D. Martin, Sr., had an interest in a plot of land and directing that the property be sold at public auction.
I. Background Facts and Proceedings
Bobby D. Martin, Sr. (Bob) filed a petition for partition in August 2003. Bob alleged he and Bobby D. Martin II (Bobby) were owners, as tenants in common, of an approximately forty-acre tract of real estate located in Appanoose County. He further alleged he and Bobby were not able to agree as to the division of the real estate, and requested that the court establish their respective rights in the real estate and order the property sold and the proceeds divided equally between the parties. In his answer, Bobby denied Bob's alleged interest in the property. In the alternative, Bobby requested partition in kind if the court determined such an interest existed.
Trial was held on October 7, 2004. A reasonable fact-finder could find the following facts from the record in this case.
In early 1993, Bob gave Bobby a $10,000 check, believing the money was to be used for the acquisition of property. The check was cashed and the money drawn out of Bob's account, but Bob could not show what the money was used for. Bob has given Bobby money on numerous occasions, and the two have commingled funds and maintained joint accounts over the years. Bobby denied ever receiving the $10,000 from his father, although he listed a $10,000 debt to his father in financial affidavits filed in two subsequent divorce proceedings.
On October 1, 1993, Bobby purchased the property at issue for $12,000 on contract. Bobby obtained at least some of the $2,000 down payment from his father. Bob accompanied his son to the closing and furnished cash from his pocket that day to make up for a shortfall. Bobby paid property taxes and made monthly payments on the property until it was paid in full in 1999. The check for the final payment was drawn on a joint bank account Bobby had with his father.
Bob and Bobby began moving Bob's equipment and junk iron from other locations onto the property shortly after the closing. Bobby had equipment and junk of his own on the property. Bob, an excavator and semi-driver, made various improvements to the property, including building a pond, installing a fence, putting $800 worth of shale on the driveway, installing rural water pipe, clearing trees, and grading. He upgraded the septic system and moved two trailers onto the property. Bob purchased lumber to build a garage that has never been built. Bobby assisted with some of these improvements and lives in one of the trailers. Bob and Bobby used the other trailer for storage; Bob had his own key. Bob furnished a tractor and mower for Bobby's upkeep of the property. Funds for some of the improvements to the property came from the parties' joint checking account. For some years, Bob was accorded the "landowner's" designation for hunting purposes.
Bobby divorced his first wife in 1998. He retained full interest in the land being purchased and the mobile home affixed to it. Bobby remarried in June 1999, but separated from his second wife, Sheryl, by the fall. Bobby filed a petition for dissolution of marriage in November 1999. In a January 2000 certification to the court, Bobby listed the value of the property and mobile home at $30,000. He cited no specific encumbrance upon the property, but listed as a debt the $10,000 owed to Bob.
On February 21, 2000, Bob and Bobby signed an "Agreement Regarding Real Property." The agreement provided that the parties were "memorializing an agreement between themselves that has existed since Bobby D. Martin, II's purchase of said real estate." The parties agreed that "although the [property] is recorded in the name of Bobby D. Martin, II, Bobby Martin, Sr. did provide one-half of the improvements and payments thereon and is thereby entitled to one-half of its value."
The same day, Bobby executed a quit claim deed. The deed indicated "Bobby D. Martin, II and Sheryl Lynn Martin, as husband and wife" were quit claiming the property to "Bobby D. Martin, II and Bobby Martin, Sr., as tenants in common." Sheryl's name was subsequently crossed out. Bobby remained legally married to Sheryl on that date. Bobby signed the deed; Sheryl refused to sign it.
The district court entered a decree of dissolution one year later, on February 21, 2001. The decree awarded the homestead, "which was owned by [Bobby] prior to his marriage to [Sheryl]," to Bobby.
According to Bob, the agreement and deed were executed to protect his interest in the property. He held the deed until July 2003, when he filed it after a falling-out with Bobby. Shortly thereafter, Bob filed the petition for partition.
Gregory Morehead, a real estate appraiser, was asked to determine whether an equitable division of the property was possible. He testified that due to the unique shape and character of the property, public auction would be the best way to obtain fair market value of $800 to $850 per acre. In his opinion, any division of the property would diminish its value.
The district court filed its findings of fact, conclusions of law and decree of partition on December 6, 2004. The court concluded Bob proved his contribution of lawful consideration for an ownership interest in the property by a preponderance of credible evidence. The court further concluded that application of Iowa Code section 561.13 (2003), which requires the consent of a spouse for a valid conveyance or encumbrance of a homestead, "would effect manifest injustice upon the parties in litigation here." Therefore, the quit claim deed "remains a viable, lawful transfer of half [Bobby's] title to Bob." The court rejected Bobby's defenses of fraud, estoppel and laches for lack of sufficient proof. It ordered public auction of the property and awarded Bob reasonable attorney fees of $2,728.52. Bobby appeals.
II. Standard of Review
Our review of this equitable proceeding is de novo. Iowa R. Civ. P. 1.1201; Iowa R. App. P. 6.4. We give weight to the findings of the district court, but are not bound by them. Iowa R. App. P. 6.14(6)( g).
III. Discussion
Bobby argues the district court erred in finding a common interest in the property. He contends the quitclaim deed is void because Sheryl, Bobby's wife at the time the deed was executed, failed to sign the deed as required by Iowa Code section 561.13. He also argues the conveyance is void for lack of consideration and/or under the theories of laches and estoppel by acquiescence. In the alternative, he argues that if this court concludes the property is owned jointly by Bob and Bobby, it should be partitioned in kind, rather than sold at public auction.
Iowa Code section 561.13 provides, in pertinent part:
A conveyance or encumbrance of . . . the homestead, if the owner is married, is not valid, unless and until the spouse of the owner executes the same or a like instrument, or a power of attorney for the execution of the same or a like instrument, and the instrument or power of attorney sets out the legal description of the homestead.
Iowa Code § 561.13. The statute's wording and meaning has remained substantially the same since its enactment in 1851. See In re Estate of Gustafson, 551 N.W.2d 312, 314 (Iowa 1996). "[I]t has been repeatedly held that the conveyance is void unless executed in compliance with the provisions of the statute." Alvis v. Alvis, 123 Iowa 546, 551, 99 N.W. 166, 168 (1904). "A conveyance of a homestead occupied by husband and wife, in which the wife does not join, is invalid for any purpose." Goodwin v. Goodwin, 113 Iowa 319, 324, 85 N.W. 31, 32 (1901).
The record is clear that Bobby and Sheryl were legally married at the time the quitclaim deed was executed and that the deed purported to convey the couple's homestead. Sheryl did not sign the deed. Therefore, the deed did not comply with the terms of section 561.13 and is void and Bob is not a joint owner of the property. Partition can only be granted when the property is owned jointly or by tenancy in common. Jones White v. Park, 220 Iowa 903, 905, 262 N.W. 801, 802 (1935); Johnson v. Moser, 72 Iowa 523, 525, 34 N.W. 314, 315 (1887); see also 59A Am.Jur.2d Partition § 1, at 11 (2003) (defining "partition" as "the dividing of lands held by joint tenants . . . or tenants in common . . ."). Because Bob has failed to show joint ownership of the property, the petition to partition must be dismissed.
It is less clear from the record whether Sheryl was living on the homestead at the time the deed was executed. Bobby testified Sheryl was living on the homestead when the deed was executed. The district court, however, concluded "[c]ircumstantial evidence demonstrates that Sheryl had abandoned the homestead at the time of the deed's signing." Whether or not Sheryl had abandoned the homestead does not affect the application of section 561.13. See Beal Bank v. Siems, 670 N.W.2d 119, 123 (Iowa 2003) (holding that mortgage executed by wife, without the signature of her husband, was void as to both husband and wife, even though husband lived at a different residence at the time).
The district court concluded application of section 561.13 to declare the deed void "would effect manifest injustice upon the parties." The district court, however, was not free to disregard the requirements of section 561.13. "`[C]ourts of equity are bound by statutes and follow the law in [the] absence of fraud or mistake.'" Iowa State Bank Trust Co. v. Michel, 683 N.W.2d 95, 107 (Iowa 2004) (quoting Mensch v. Netty, 408 N.W.2d 383, 386 (Iowa 1987)). "This rule preserves the integrity of the legislature's judgment that certain transactions will be given effect only if they comply with the requirements set out in the statute." Id. Granting partition in this case "would render section [ 561.13] meaningless, and noncompliance with the statute of no moment." See id. (holding that bank/mortgagee was not entitled to an equitable mortgage on landowner's agricultural homestead due to failure to comply with statute requiring express disclosure for waiver of land owners' homestead exemption for agricultural land).
We disagree with the district court's conclusion that the dissolution decree, which awarded the homestead to Bobby, is "the same or a like instrument" executed by Sheryl that ratifies the transfer of the property to Bob and Bobby as tenants in common. See Iowa Code § 561.13. We do not find the statute susceptible to such a broad interpretation.
The district court awarded attorney fees pursuant to Iowa Rule of Civil Procedure 1.1225 (requiring the court to fix and tax as costs a fee in favor of plaintiff's attorney on partition of real estate). Because we conclude the deed was void and Bob's petition for partition should be dismissed, we must also reverse the district court's judgment of attorney fees.
We reverse the decision of the district court and remand for entry of an order dismissing Bob's petition for partition. Costs shall be taxed to Bob. See Iowa R. Civ. P. 1.1224. The parties shall each be responsible for their own attorney fees.