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ROGERS, et al. v. ROGERS, et al. (59824)


ROGERS, et al.

v.

ROGERS, et al.


February 26, 1999
Record No. 980846

WALTER M. ROGERS, JR., ET AL.

v.

CHARLES EDWARD LEE ROGERS, ET AL.

FROM THE CIRCUIT COURT OF PRINCE WILLIAM COUNTY

Herman A. Whisenant, Jr., Judge
Present: Carrico, C.J., Compton, Hassell, Keenan,
Koontz, and Kinser, JJ., and Poff, Senior Justice

OPINION BY JUSTICE LEROY R. HASSELL, SR.


In this appeal we consider whether creditors,
who obtained a judgment against a husband and a different
judgment against his wife, may compel the sale of real property
owned by the husband and wife as tenants by the entireties with
right of survivorship to satisfy those judgments.

Because this case was decided on demurrer, we
will state the facts "in accordance with well-established
principles that a demurrer admits the truth of all material facts
that are properly pleaded, facts which are impliedly alleged, and
facts which may be fairly and justly inferred from alleged
facts." MNC Credit Corp. v. Sickels, 255 Va.
314, 316, 497 S.E.2d 331, 332 (1998) (quoting Cox Cable
Hampton Roads
v. City of Norfolk, 242 Va. 394, 397,
410 S.E.2d 652, 653 (1991)).

Walter M. Rogers, Jr., Ronald A. Rogers, and
their closely held corporation, Rogers Brothers, Inc., a Virginia
corporation, filed their amended bill of complaint against
Charles Edward Lee Rogers (Mr. Rogers), Eleanor P. Rogers (Mrs.
Rogers), Option One Mortgage Corporation, and Dennis E. Burke,
trustee. The complainants alleged the following.

In November 1991, the complainants obtained a
judgment against Mr. Rogers entered by a federal bankruptcy court
in Virginia in the amount of $145,000. The complainants obtained
a separate judgment against Mrs. Rogers in the amount of $200,000
with interest, entered by the Circuit Court of Prince William
County in June 1995. The circuit court found that Mrs. Rogers had
participated with Mr. Rogers in a scheme to delay, defraud, and
hinder the complainants in their attempts to collect their
judgment against Mr. Rogers.

Mr. and Mrs. Rogers own real property as
tenants by the entireties with the right of survivorship. The
real property is located in Prince William County. Dennis Burke
"has an interest in the real property as the trustee under a
first deed of trust for the benefit of Option One Mortgage
Corporation . . . ."

The complainants further alleged: "The
purposeful and fraudulent actions of [Mr. and Mrs. Rogers] in
attempts to avoid Mr. Roger[s'] payment of the debt owed to the
[c]omplainants constitute a joint action by husband and wife
which gives rise to the second judgment and establishes the
[c]omplainants herein as joint creditors of both husband and
wife." The complainants requested that the circuit court,
among other things, order the sale of the real property to
satisfy their judgments.

The defendants filed demurrers and asserted
that the complainants do not have a cause of action against them
because real property owned by the husband and wife as tenants by
the entireties cannot be sold to satisfy "two separate
judgments, obtained on two separate dates, against two separate
spouses." The trial court entered a decree sustaining the
demurrers, and the complainants appeal.

The complainants argue that they pled a cause
of action against the defendants because the joint tortious acts
of the husband and wife gave rise to related judgments against
each spouse for the same debt and, therefore, the real property
could be sold to satisfy the debt. We disagree with the
complainants.

We have stated, clearly and without
equivocation, that real property held as tenants by the
entireties is exempt from the claims of creditors who do not have
joint judgments against the husband and wife. Vasilion v. Vasilion,
192 Va. 735, 740, 66 S.E.2d 599, 602 (1951). We discussed this
elemental common law principle in Jones v. Conwell,
227 Va. 176, 181, 314 S.E.2d 61, 64 (1984):

"It is settled that tenancies by
the entirety are based upon the same four unities that
support joint tenancies, that is, the unities of title,
estate, time, and possession. However, it is also settled
that tenancies by the entirety are supported by a fifth
unity which they do not share with any other tenancy: the
unity of marriage. That unity embodies the legal fiction
that husband and wife are one. And it leads to the result
that neither husband nor wife can by his or her sole act
defeat the survivorship interest of the other spouse.
Neither spouse can by separate act make an absolute
disposition of property they hold as tenants by the
entirety, nor can a judgment lien creditor of one spouse
subject that property to the satisfaction of his
lien."

Accord Pitts v. United States
of America
, 242 Va. 254, 258-59, 408 S.E.2d 901, 903 (1991).

Applying the aforementioned precedent, we hold
that the trial court did not err in sustaining the defendants’
demurrers. The complainants stated in their amended bill of
complaint that they had obtained one judgment against the husband
in the federal bankruptcy court for defalcation in a fiduciary
capacity and another judgment entered by the circuit court
against the wife in a fraudulent conveyance proceeding. These
separate judgments do not impose joint liability upon the husband
and wife. Thus, the complainants do not have a cause of action to
compel the sale of the real property held by the husband and wife
as tenants by the entireties with right to survivorship to
satisfy the judgments.

The complainants argue that even if they failed
to state a cause of action under existing law, this Court should
"expand" its decision in Price v. Hawkins,
247 Va. 32, 439 S.E.2d 382 (1994), and create a remedy which
would permit them to obtain a decree enforcing their judgments
against the property
[1] Our
decision in Price, however, is simply not applicable here.
In Price, we considered "whether the trial court
erred by entering in personam judgments against
transferees who participated in a fraudulent scheme to delay and
hinder a creditor by concealing the debtor’s assets." Id.
at 33, 439 S.E.2d at 383. Construing Code Sect. 55-80, which
confers upon a creditor a statutory right to request that a
circuit court set aside certain fraudulent conveyances, we held
that an in personam judgment against transferees in
the full amount of the fraudulent conveyances at issue in that
case was appropriate under the circumstances. 247 Va. at 37-38,
439 S.E.2d at 385-86. Here, however, the complainants have
neither a statutory nor a common law right to satisfy their
separate judgments by compelling a sale of real property held by
the husband and wife as tenants by the entireties with the right
of survivorship.

Finding no merit in the complainants’
contentions, we will affirm the chancellor’s decree.

Affirmed.

 

FOOTNOTES:

[1] We reject the complainants’ contention
that our decisions in Leonard v. Counts, 221 Va.
582, 272 S.E.2d 190 (1980), and Sundin v. Klein,
221 Va. 232, 269 S.E.2d 787 (1980), cert. denied sub
nom., Cross v. Sundin, 452 U.S. 911 (1981),
permit them to enforce their judgments against the real property.
These decisions have no application here. We did not consider in Leonard
or Sundin whether a creditor could satisfy a judgment
obtained against one spouse by requiring a sale of real property
held as tenants by the entireties with the right of survivorship.
In Leonard, we considered whether a chancellor’s decree
that a husband and wife held title to a parcel of land as
constructive trustees was supported by clear and convincing
evidence. 221 Va. at 587, 272 S.E.2d at 194. In Sundin, we
held that a husband, who had murdered his wife, could not recover
her interest in real property that the husband and wife had
acquired as tenants by the entireties with survivorship. 221 Va.
at 239-40, 269 S.E.2d at 791.

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