Bonds v. Bonds

Citation: 409 So. 2d 704Docket: 53000

Court: Mississippi Supreme Court; January 26, 1982; Mississippi; State Supreme Court

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Martha Moore Bonds appealed a decision from the Chancery Court of Tishomingo County, which quashed a writ of garnishment she issued against Life Casualty Insurance Company. The company acknowledged a debt of $10,477.28 owed to George Mitchell Bonds, stemming from the cash value of three life insurance policies. The chancellor ruled that these cash values were exempt from garnishment under Mississippi Code Annotated section 85-3-11, which protects life insurance proceeds from creditors.

Martha Bonds sought to enforce the writ to satisfy a prior judgment of $21,006.84 against George Bonds for child support and alimony, arguing that the exemption statute did not apply because George had the right to change beneficiaries on the policies, meaning the beneficiary's interest was not vested until his death. The chancellor disagreed, but the Supreme Court of Mississippi reversed this decision, citing established precedent that a beneficiary's interest in a policy with a reserved right to change is not vested until the insured's death, thus allowing the garnishment to proceed.

The cash surrender value of a life insurance policy remains under the control of the insured, Bonds, until his death. The core legal question is whether Section 85-3-11 exempts this cash surrender value from garnishment actions aimed at satisfying child support and alimony decrees. This specific issue has not been previously addressed in Mississippi. However, the case Dreyfus v. Barton interprets Mississippi Code Annotated section 85-3-13, which exempts certain life insurance proceeds from creditor claims, highlighting that the cash surrender value qualifies as 'proceeds' and is exempt as long as it does not exceed three thousand dollars. The statute's purpose is to protect the insured's policy for the benefit of dependents rather than creditors, emphasizing that such policies are often acquired to safeguard families from financial hardship.

Further, the distinction between ordinary creditor-debtor relationships and obligations for child support and alimony is established in cases like Hollis v. Bryan and Fanchier v. Gammill. These cases clarify that alimony and child support are not considered debts in the traditional sense, as they arise from public policy and legal duties rather than mere contractual obligations. The courts have affirmed that a wife's demand for alimony does not fall under the creditor protections outlined in federal statutes. Similarly, Stirgus v. Stirgus reiterates that the duty of a husband to support his wife stems from marriage and public policy, reinforcing the view that such obligations cannot be categorized as standard debts.

Felder v. Felder's Estate, 195 Miss. 326, 13 So.2d 823 (1943), distinguishes alimony and child support from typical creditor/debtor relationships concerning exemption statutes. The court determined that alimony is not merely a debt but a legal obligation derived from marriage, serving both the beneficiaries and public interest, and thus cannot be discharged in bankruptcy. Consequently, Section 85-3-11 does not apply to child support and alimony, as these obligations are specifically excluded from general exemption statutes. The applicable statute, Section 85-3-1, states that property is exempt from seizure for court orders except for those involving alimony, separate maintenance, and child support. The court noted that the exclusions were established by prior decisions and emphasized that public policy regarding child support remains strong, despite changes in societal norms. The chancellor's ruling that the appellee was exempt under Section 85-3-11 was found to be erroneous, leading to a reversal of the order and a judgment against the garnishee defendant for specific amounts. All costs were assessed to the appellee, George Mitchell Bonds. The decision was supported by multiple justices.