## Facts

- George held a judgment against L. W. Ransom (the husband).
- E. S. Ransom (the wife) owned 15 shares of stock in the Citizens’ Steam Navigation Company, purchased with her separate funds and held in her name.
- Dividends of about $250 accrued on the stock.
- George initiated proceedings to reach the dividends by requiring the company’s secretary (Horace Beach) to appear and answer regarding the company’s indebtedness for those dividends.
- The trial court found the shares and dividends were the wife’s separate property and dismissed the creditor’s attempt to reach them.
- George appealed.
- A statute provided that the “rents and profits” of a spouse’s separate estate were deemed common (community) property unless an instrument creating the wife’s separate property specified the profits were for her sole and separate use.
- The California Constitution declared specified categories of a wife’s property to be her separate property and directed the legislature to define rights in relation to separate and common property.

## Issues

1. Whether a husband’s creditor may seize dividends (as “profits”) generated by the wife’s separate property to satisfy the husband’s debt.
2. Whether the legislature may, consistent with the California Constitution’s separate-property guarantee, classify the fruits of the wife’s separate property as community property subject to the husband’s creditors.

## Decision

- The California Supreme Court affirmed.
- A husband’s creditor may not subject the proceeds or dividends of the wife’s separate estate to the creditor’s claim.
- The constitutional protection of the wife’s separate property includes the right to beneficial enjoyment of its ordinary fruits.
- The statute could not be applied to divert dividends from the wife to the husband or his creditors where doing so would defeat the constitutional protection.

## Legal Principles

- A constitutional designation of a wife’s separate property protects more than formal title; it protects the beneficial use and enjoyment of that property.
- The legislature lacks authority to transfer the fruits (rents, profits, proceeds, or dividends) of the wife’s separate property to the husband or make them liable for the husband’s debts in a manner that nullifies the constitutional guarantee.
- Dividends from stock purchased with the wife’s separate funds retain the character of separate property for purposes of creditor process against the husband.

## Conclusion

Dividends generated by a wife’s separate property remained her separate property and could not be garnished to pay the husband’s judgment debt, because the constitution’s separate-property guarantee prevented legislative reclassification that would strip the wife of the beneficial enjoyment of her property.


George v. Ransom, 15 Cal. 322 (Cal. 1860)