Summary of Sawada v. Endo, Supreme Ct. of Hawaii (1977)
Parties: Endos are the sons whom the land was conveyed to, and Sawadas were was injured in decedent’s auto crash.
Cause of action/remedy sought: The following is a civil action seeking to set aside a conveyance of real property from judgment debtor husband Endo to his sons.
Procedural History: Consolidated trial 1/19/71 resulted in a judgment was entered for Helen Sawada for $8846.46. Masako Sawada also won on a separate judgment for $16,199.28. Trial court refused to set aside the conveyance of land from father to sons, and they appeal to this court. On appeal, judgment affirmed.
Facts: Sawadas hurt in car accident 11/30/68 by Kokichi Endo. Complaint for damages filed 6/17/69, with complaint and summons served 10/29/69. By deed 7/26/69, Kokichi and wife conveyed the property to their sons; no consideration was paid by grantees for the conveyance.
Issue(s): Under HI property law, is the interest of one spouse in real property, held in tenancy by the entireties, is subject to levy and execution by his or her individual creditors?
Holding: No. Under the Married Women’s Property Acts, the interest of a husband or a wife in an estate by the entireties is not subject to the claims of his or her individual creditors curing the joint lives of the spouses. The conveyance of the marital property by Kokichi Endo and Ume Endo, husband and wife, to their sons Sam and Toru, was not in fraud of Kokichi’s judgment creditors.
Court’s Rationale/Reasoning: MWPA gave the woman rights to property in a marriage. Neither husband nor wife has a separate divisible interest in the property held by the entirety that can be conveyed or reached by execution. The indivisibility of the estate, except by joint action of the spouses, is an indispensable feature of the tenancy by the entirety. MD case law held that a lien on property which was from a tenancy by the entirety was the equivalent of conversion into joint tenancy or tenancy in common, if the debt was only against one partner.
Creditors are not entitled to special consideration, “…if the debt arose subsequent of the creation of the property, the creditor presumably had notice of the characteristics of the estate which limited his right to reach the property.”
Rule: An estate by the entirety is not subject to the claims of the creditors of one of the spouses during their joint lives.
Did court avoid issues?: This is a tort collection, so how come they can’t get a lien on land in order to pay debt for a civil wrong?
Dicta: This issue is one of first impression in Hawaii.
Dissents: The application of MWPA should be read as it is in NJ, that the wife, who has half interest in the tenancy by the entirety, should keep her half of the estate, while the other half, or the husband’s half in this case, at the right of survivorship, is alienable, and subject to attachment by his separate creditors and used to pay the debt.