author: DAVIE, S.

text:
    In the Matter of the Judicial Settlement of the Accounts of the Surviving Executors of Samuel Oosterhoudt, Deceased.

      (Surrogate’s Court, Cattaraugus County,

      Filed January, 1896.)

    1. Executors—Liability.
    Personal property, though specifically bequeathed, must he applied to the payment of debts before lands specifically devised can be charged therewith; and in consequence, where an executor first applies the rents of the real estate for the payment of debts, it is a misappropriation of the funds, for which the executor is held personally liable.
    2. Same.
    In-such case, the executor is liable as for a devastavit.

    3. Same—Interest.
    An executor is chargeable with interest if he has made use of the money himself, or has been negligent either in not paying over the money or in not loaning or investing it so as to render it productive.
    4. Same.
    But, where he transfers personalty to the legatees and leaves claims against the estate unprovided for, liPj.will not be charged interest on the value thereof, where he has borroweu money with which to pay debts and his claim for discount on such borrowed money disallowed.
    5. Same—Outlawed claims.
    An executor will not be allowed upon his accounting any sum paid by him on an outlawed claim.
    6. Bills and notes—Indorsement.
    Where a person, who lives in New York, there indorses and gets discounted a note payable in Ohio, the contract of indorsement is a New York contract, anil an action thereon is governed by the statute of limitations of the latter state.
    7. Estoppel—Silence.
    A legatee is not estopped from making claim against the executors who pay a claim barred by the statutes, because, when they propose in her presence and that of other legatees to pay such claim, she makes no response.
    8. Same—Creditors.
    But the fact lliat legatees are estopped by their acts from making a claim against executors for paying an outlawed claim, does not prevent creditors of the estate from making claim because of such payment.

      Proceeding for settlement of the accounts of the surviving executors of Samuel Oosterhoudt, deceased.
    James H. Waring for executors ; O. S. Vreeland, for contestant.
   DAVIE, S.

— Samuel Oosterhoudt died at the town of Olean November 12, 1884, leaving, him surviving, his widow, Mary II. Oosterhoudt, a son, Samuel F., and two daughters, Eva E. Smith and Mary A. Allen. His will, bearing date November 8, 1884, was admitted to probate on the 26tli of the same month. The widow and son and John B. Smith, the husband of one of the daughters, were named executors, and each duly qualified The widow died June 10,1890,without having participated to any great extent in the management of the estate. The testator devised certain real estate to his widow absolutely, and bequeathed to her the income of his bank stock during life. He devised to each of his children and to a granddaughter certain real estate, and bequeathed to the son and to eaeli of his two minor grandsons 20 shares of his bank stock after the death of the widow. The balance of his estate he devised and bequeathed to his three children share and share alike. Shortly after the probate of the will, the legatees, by mutual, agreement, took possession of the various parcels of real estate devised to them respectively. There were certain liabilities existing against the testator at the time of his death, some of which were absolute and others, by way of indorsements, contingent. In the account filed, the executors charge themselves with total receipts to the amount of $18,-493.17. They credit themselves with having expended in the administration of said estate $31,935.14. They report outstanding demands against the estate exceeding $15,000.

The testator was the owner of 60 shares of the capital stock of the First National Bank of Olean, of the par value of $100 per share, but actually worth much more. No certificates for such stock had been executed or delivered to the testator, but his name ' was entered on the hooks of the hank as the owner of and entitled to such shares. Dividends were declared by the "bank upon such stock from time to time, usually semiannually, and paid to the widow to the time of her death. t)n the 23d day of September, 1890, the officers of the bank by direction of the surviving executors, executed certificates for such stock directly to the legatees, that is, for twenty shares to the son and to each of the two grandsons. On October 9th following, Samuel 'F. Oosterhoudt sold his stock to one Dusenbury for $4,200, and on April 23, 1893, the twenty shares of stock issued to the grandson S. E. Smitli were transferred by his general guardian to Dusenbury for $4,160. The only reference made by the executors to this stock in their account is that it was specifically bequeathed, and had been turned over by them to the legatees. All the other assets were disposed of by the executors, as well as the land not specif!-, cally devised, the legatees all joining in the conveyance, and the proceeds arising from the disposition thereof expended by them in the course of administration. This being the situation of the estate, it is claimed on behalf of the contestant that this bank stock should have been applied by the excutors in the payment of debts, and that they were not authorized to transfer' it to the legatees, although specifically bequeathed, leaving the debts unprovided for.

The rule is well settled that the personal property is the primary fund for the payment of debts. The order of marshaling assets for the payment of debts is: First, the general personal estate; second, estates specifically devised for the payment of debts; third, estates descended; and fourth, estates specifically devised, though charged generally with the payment of debts. 1 Birdseye’s Rev. St. 1131. The testator is presumed to act upon this legal rule in making a testamentary disposition of his estate until some distinct and unequivocal intention to the contrary is shown. Hoes v. Van Hosen, 1 N. Y. 120; In re Smith, 19 St. Rep. 898. There is nothing in the express provisions of the will exonerating the bank stock from the operations of this general rule; nor does the evidence relating to the extrinsic circumstances indicate any such intent on the part of the testator. An arbitrary construction of the terms of the will so as to exonerate the personal estate specifically bequeathed from all the burdens of debts and expenses of administration, thereby charging such debts and expenses upon the real estate specifically devised, would be entirely unsustained by authority. This is not a debatable question. It has been distinctly held that personal property although specifically bequeathed, must be applied to the payment of debts before land specifically devised can be charged therewith-; and, in consequence, where an executor first applied the rents of the real estate to the payment of debts, in such a case it was held to be a misappropriation of the funds, for which the executor was held liable personally. Nagle v. McGinniss, 49 How. 193; Rogers v. Rogers, 3 Wend. 503; In re Smith, supra; Hoes v. Van Hosen, 1 Barb. Ch. 379; 1 N. Y. 120; Dodge v. Manning, 11 Paige. 334. This question has frequently claimed' the consideration of other courts, where it has been distinctly held that even a charge of the testator’s debts upon his lands generally, however formally framed, will not exonerate the personalty. White v. White, 2 Vern. 43; Bridgman v. Dove, 3 Atk. 20; Hancox v. Abbey, 11 Ves. 186: Duke of Ancaster v. Mayer, 1 Brown, Ch. 454. The executors having made an unauthorized and improper application of this portion of the assets, they are personally liable,,therefor as for a devastavit. Conduct on the part of representatives amounting todevastavit is defined to be “such a mismanagement of the estate and effects of deceased in squandering and misapplying the assets contrary to the duty imposed on them for which executors and administrators shall answer out of their own pockets so far as they have had or might have had assets of deceased.” Williams’ Ex’rs (Eng. Ed.) 1796; 7 Am. & Eng. Enc. Law, 346, note 1. Paying debts or legacies out of order, making mispayments, paying legacies before debts, applying the assets in undue funeral expenses, delivering property to next of kin, leaving debts unpaid, are all adjudged instances of such mal-administration as constitute devastavit. 7 Am. & Eng. Enc. Law, 346, note 2; Cobb v. Muzzey, 13 Gray, 58; Place v. Oldham, 10 B. Mon. 400; McNair v. Ragland, 1 Dev. Eq. 516. The responsibility for this misappropriation rests upon both of the accounting executors. Each participated in the transaction for the disposition of the bank stock. One of the executors and a minor son of each were the beneficiaries of the transaction. Moreover, the executors each join in the account, and that is an admission of joint action ami joint liability. Glacius v. Fogel, 88 N. Y. 434-443. Oosterhoudt received $4,200 for his stock; Smith, as guardian, $4,160; and the stock transferred to Oosterhoudt’s son was worth $4,200, —making a total amount of $12,560 with which the executors must be personally charged.

It is also claimed on the part of the contestant that the executors should be charged with interest upon the value of the bank stock from the time of it misapplication. The liability of.executors and administrators for interest must depend largely upon the particular facts of each individual case. There are, however, certain well-defined principles applicable thereto. In Dunscomb v. Dunscomb, 1 Johns. Ch. 508, it is said : Executors and other trustees are chargeable with interest if they have made use of the money themselves, or have been negligent either in not paying over the money or in not loaning or investing it so as to render it productive.” This rule has been frequently recognized and applied. Cowing v. Howard, 46 Bard. 580; Duffy v. Duncan, 32 id. 593. They are liable for interest on moneys of the trust fund converted to their own use. Schieffelin v. Stewart, 1 Johns. Ch. 624; Brown v. Rickets, 4 id. 303; Manning v. Manning’s Ex’rs, 1 id. 535; Mumford v. Murray, 6 id. 1; Kellett v. Rathbun, 4 Paige, 102; De Peyster v. Clarkson, 2 Wend. 78. The law exacts fidelity of a trustee in the management of his trust. If he is guilty of fraud or mismanagement, or is guilty of a breach of trust, or has used the trust funds for his own purpose, he may be compelled to pay interest. Price v. Holman, 135 N. Y. 133; 48 St. Rep. 38l. Executors have been charged with interest where, by their wrongful acts, as by mispayments, they have disappointed claimants (Jones v. Ward, 10 Yerg. 161); where, without reason, they have recalled funds out at interest (Verner's Estate, 6 Watts, 250); where they unreasonable refuse or neglect to account (Gray v. Thompson, 1 Johns. Ch. 82). An application of the principles enunciated in the authorities cited to the case at bar, considering the transaction of the disposition of the bank stock independent of any other features of the case, would render the executors liable for interest to some extent upon the value of the stock; but the conclusions reached, as hereinafter set forth; regarding the executors’ credits in their account for discounts paid by them indirectly reaches the same result. The executors ought not to be charged with interest, and their claim for reimbursement for discounts paid by them also disallowed. This would be subjecting them to a double penalty.

Tiie accounting executors from time to time made their promissory notes as executors, and caused them to be discounted at the First National Bank of Olean. One of such notes, dated February 8, 1893, was for $3,265 ; another, dated March 19, 1893-, for for $1,077.63 ; another, dated March 9th of the same year, for $750; another, dated April 29th of the same year, for $250 ; and each dee in three months from date. Sueli notes have been renewed from time to time, and áre still outstanding, and held by the bank. The total amount paid by the executors as discount to this bank was the sum of $2,216.69. On the 11th day of June, 1888, the executors made them promissory note as executors for the sum of $3,000, and procured the same to be discounted at the bank of Henry Hamlin ; and again, on the 14th day of May, 1889, they made another note for $3,000,-which they also discounted at the same bank. The executors renewed these notes from time to time, paying various sums upon the principal, until the first noté was reduced to $1,400, and the second, $1,700. The total amount paid by the executors to Hamlin as discount upon those two notes and their various renewals was the sum of $1,-082.58. The executors in their account credit themselves and charge the estate with the discount so paid, amounting in all to-the sum of $3,329.27. The contestant objects to the allowance of this item. No question is raised but what the executors used the proceeds of these various notes in payment of pressing' demands against the estate, yet the conclusion already reached in regard to the application of the bank stock made by the executors necessarily lias some bearing upon this question. It is evident that, if this stock had been properly applied by the executors in extinguishment of the liabilities of the estate, the necessity for raising funds from which to pay debts through the instrumentality of repeated discounts would not have existed. The power of executors and administrators to borrow money for the benefit of their estates is restricted, and ordinarily not justifiable. The line of conduct of such representatives is clearly defined by law. They are required to proceed with reasonable diligence in applying the personal estate in the extinguishment of debts. In case of insufficiency of the personal estate the real estate should be resorted to in the manner prescribed by statute relating to the disposition of decedents’ real estate for the payment of the debts. This the executors have not done. They have not only delivered the personal estate to the legatees, regardless of debts, but have also permitted the devisees to take possession of the real estate, without taking anv measures to meet the debts of the estate. This was, in ell’ect, turning over to the legatees more than they were entitled to receive, and then borrowing money and paying heavy discounts to meet, or rather defer, the payment of valid claims. It has been held that executors are not entitled to be credited with interest paid to raise money for advances to beneficiaries in excess of their distributive share. Adair v. Brimmer, 74 N. Y. 538-557. The executors are not entitled to be credited with any part of this discount.

The testator, at the time of his death, and for some years prior thereto, had been a member of tiie firm of Oosterhoudt & Grimes, ami as such engaged to some extent in the dealing of lumber. This linn became the owner of three promissory notes made ¡by Hall, Anderson & Co., of East Liverpool, Ohio, dated April 23, 1875 The first was for $776, due in ninety days ; the second, for $803.60, due in six months ; and the third, for $1,219.26, due in nine months from date,—all payable to the order of Oosterhoudt & Grimes at a bank in East Liverpool. Before the maturity of either note the firm of Oosterhoudt & Grimes indorsed each of them and procured them to be discounted attlie First National Bank of Olean. These notes, when due, were presented at the, bank in East Liverpool for payment, and payment denied, and each note protested, and the linn of Oosterhoudt & Grimes duly charged as indorsers thereon. After their dishonor these notes were delivered by the cashier of the First National Bank of Olean to its attorney, and by him forwarded to one Hall, an attorney at East Liverpool, for collection. The first note was so delivered August 31, 1875; the second, October 80, 1875; and the third, February 25, 1876. Two payments were made on the first note, viz.• $450, December 8, 1875, and $249.30, January 3, 1876. Nothing else was paid on either of them, and the First National Bank of Olean continued to hold the notes down to the deatli of the testator. After his death, and on the 29th day of June, 1885, one Lawton, who was the cashier of this bank, took up these notes, and became the owner of them, paying the bank the amount remaining unpaid thereon, to wit, the sum of $2,863; and thereafter the executors made their own note as executors, and delivered the same to Lawton in place of the original Hall, Anderson & Co.’s notes. Lawton held such new note for a time but subsequently transferred it to the Cuba National Bank. The executors paid to Lawton, for interest on such note accruing while he held it, the s nil of $331.95. They subsequently paid the note to the Cuba National Bank, paying thereon, June 16, 1887, $2,270.20, and on September 15th of die same year the balance, $883.40. The othu' partner, Grimes, having died intestate; an administrator of his estate was appointed, who transferred to one J. H. Grimes, such interest as belonged to his estate in said copartnership allairs, and J. H. Grimes began an action in supreme court against the executors of the Oosterhoudt will for an accounting, claiming a large balance. The executors appeared and answered, alleging, among other things, the payment of the Hall, Anderson & Co.’s notes. The case was tried before a referee, who reported thereon, finding the facts substantially as herein set f nth, and, as matter of law, that the payment by the executors of said notes was unauthorized and illegal, inasmuch as the right of action existing thereon against the indorsers, Oosterhoudt & Grimes, was barred by the statute, and judgment was entered thereon, and affirmed on appeal to tlm general term. Grimes v. Osterhoudt, 18 St. Rep. 422. The executors credit themselves in the account filed with the amount paid by them in extinguishment of the Hall, Anderson & Co.’s notes, to which payment the contestant objects.

It is entirely evident that the right of action against the testator upon his indorsement of each of these notes was fully barred by the statute prior to his decease. The evidence shows that Oosterhoudt conferred, from time to time, with the attorney of the bank in. regard to the collection of these notes;' but it does not show, directly or inferentially, any arrangement or agreement suspending the running of the statute as against the cause of action upon his indorsement. Over eight years elapsed after the testator became charged as indorser, and before his death. During all that time, the testator was a resident -of the same town in which the bank was located. No legal impediment existed to the bringing of an action in favor of the bank against him at any time during the six years, next immediately following the protest of the notes. The original notes having been made and delivered in Ohio, and made payable there, the laws of that state would, of course, regulate the liability of the makers; but the discounting of the notes at -the First National Bank of O-lean, and the indorsement made for that purpose, were transactions consummated entirely with reference to and governed by the laws of this state. The indorser of a bill or note is regarded as undertaking to pay at the place where his indorsement is made, and he is bound by the laws of the place of indorsement even though the note be expressly payable elsewhere. 2 Daniel, Neg. Inst. § 399. Upon indorsement a new contract arises governed by the laws of the place where it is made. 2 Am. & Eng. Enc. Law, 384 ; Edmunds, Bills & N. 262. In determining the lex loci contractus the engagements of the maker and indorser of a note are to be treated as independent contracts. Lee v. Selleck, 33 N. Y. 615; Van Staphorst v. Pearce, 4 Mass. 258 ; Kilgore v. Bulkley, 14 Conn. 362 ; Cook v. Litchfield, 9 N. Y. 279. Where a party residing in this state holds a note payable in another state, indorses it, and procures it to'be discounted here, his contract, is that, upon such note being presented where it is payable, and there dishonored, he will pay it here. Artisans’ Bank v. Park Bank, 41 Barb. 599. The First National Bank of Olean could have maintained an action against the testator upon his indorsement immediately after the protest -of these notes. The right of- action accrued at that time, and was barred by the statute at the end of six years.

This demand being barred, it was the duty of .the executors to resist payment. An executor is bound to set up the bar of the statute, and he has no authority to allow a claim -so barred as against an estate. A debt so barred, so far as the liabilities of an executor is concerned, is to be regarded as no debt. Butler v. Johnson, 111 N. Y. 204; 19 St. Rep. 85. An executor cannot be allowed upon his accounting any sum paid by him on such a demand. Bloodgood v. Bruen, 8 N. Y. 362 ; Bucklin v. Chapin, 1 Lans. 443 ; Burnett v. Noble, 5 Redf. 69. But it is contended • on behalf of the accounting executors that this demand was adjusted and paid by consent of all the heirs, including.the-contestant. Mrs. Smith did undoubtedly acquiesce in such payment, but the evidence is somewhat conflicting in so far as it relates to the contestant’s participation in such arrangement Mrs. Smith, the wife of the executor, testified as follows:

“ Q. After a time, was there any talk in the family about a claim that Lawton had against the estate? A. Yes, sir. Q. More than once? A. Yes, sir. Q. Where did it take place ? A. Always at my father’s house in the city. Q. How many different conversations can you remember that took place when Mrs. Allen was present? A. I can’t remember. I heard it talked so much I can’t give any number at all. It was always talked so much that we were all tired of it. Q. You may relate the different conversations had in respect to this matter ? A. I can’t tell-; only that my mother always said that it was to be paid; that my father’s honor was to be preserved under any circumstances. Q. Was this matter talked over there in the family before the arrangement was made with Mr. Lawton for the payment? A. Yes, sir.

On her cross-examination this witness testified as follows:

“ Q. I don’t understand you to claim that Mrs. Allen ever consented that this Lawton debt should be paid, did you? A. I have never heard the slightest objection. Q. You don’t claim that you ever heard Mrs. Allen consent that this Lawton debt be paid ? A. Only by silence giving consent.”

The executor Smith testified that on one occasion the subject of the payment of this debt was discussed between himself and wife and Mrs. Allen, the executor Oosterhoudt and the widow, and that he (Smith) informed them that he had seen Lawton and looked the matter over, and become convinced that the testator had had the money, and that the widow said, if they were convinced that testator had had the money,-she wanted it paid ; and, quoting from his testimony,

“My wife said, I think, that she wanted it paid, and Mr. Oosterhoudt (the executor) wanted it paid, and I think Mrs. Allen expressed herself in so many words; but I am not able to say. Q. What, if anything, did Mrs. Allen say ? A. Mrs. Allen said the only objection she bad to paying it was that old Lawton would get it; that she had always d,espised the man. That is all, in substance. Q. Was there anything more said? A. We said we were going to pay it. Q. Did Mrs. Allen say anything else? A. No, sir. Q. Was it after you had stated that you were going to pay it that Mrs. Allen made the remark you have stated she did make ? A. Yes, sir,

The evidence of the other executor throws no light on this subject. The contestant gave her version of the transaction as follows:

“ Mr. Smith said that Lawton had been down to the mill again, hounding Frank about that debt. I said I did not think the claim ought to be paid. I gave my reasons. I said that my father said that he was not to pay it, and that his children should never pay it. I remember that my mother said she did not see why Lawton expected the estate to pay it. Pa had said that he ought not to pay it. At that time Smith said that he didn’t think we ought to pay it.' I know that I said'on that occasion, that I objected to it on the ground, just as I did at first, that my father said lie shouldn’t pay it, and that none of his children should pay it; that it was not his to pay. Q. Did Mr. Smith ever say, in your presence, that he intended to pay it? A. No sir. Q. When did yon first learn that the claim had been paid? A. The fall of 1889.

This was substantially all the evidence beariug upon this proposition. The most that the executors can claim from the evidence presented on their behalf, if entirely uncontradicted, was that when the subject of paving this claim was discussed in the family the contestant expressed no dissent; that she remained silent. So the question presented is simply this: the executors proposed, in the presence of the contestant, to pay an outlawed claim. The contestant makes no response. Does silence, under such cironinstances, establish consent or acquiescence, constituting estoppel? It is stated as a rudimentary principle, that:

“When a man has made a declaration or representation, or caused, or in some cases not prevented, a false impression, or done some significant act, with intent that others should rely and act thereon, and upon which others have honestly relied and acted, he should not be permitted to prove that the representation was false, or the act unauthorized or ineffectual, if injury would occur to the innocent party who had acted in full faith in its truth or validity." 2 Pars. Cont. 793, c. 4, § 4.

If the contestant had made any positive declaration of assent, which had been acted upon by the executors, she would not now be permuted to question their authority. She would be estopped under the principal above enunciated. But mere silence on her part cannot have that effect. To constitute an estoppel, there-must have been some act or admission- by the contestant inconsistent with the claim she now makes, done with the intention of influencing the conduct of the executors, and which she had reason to believe would, in fact, have that effect. Silence will not estop, except in those cases where there is not only a right, but a duty to speak. N. Y. Rubber Co. v. Rothery, 107 N. Y. 310; 12 St. Rep. 53; Viele v. Judson, 82 N. Y. 32; Diffenbach v. Vogler, 61 Md. 370. The only reasonable construction tobe given to the entire evidence bearing on this question is that the contestant expressed a decided and positive objection to the payment of-this claim when the matter was discussed in her presence, and that, so far as she was concerned, the executors were unauthorized to make the payment.

But there is another feature of this case absolutely precluding the right to allow this credit to the executors upon this accounting. The account filed, as already stated, concedes that there is a large amount of unpaid indebtedness existing against the estate. This accounting is an intermediate one. The creditors are not parties to this proceeding, not having been cited. They are interested in the termination of this question, which must be disposed • of in the same manner "as if the creditors were present and objecting to the allowance of this claim. Whatever arrangement may have been made between the executors and the heirs with reference to the payment of the Lawton claim, the creditors are not bound, thereby; there being no pretense that any of the creditors assented thereto. After the death of the testator and the probate of the will, the dividends declared upon the bank stock owned by the testator were paid by the widow to the time of her death. Seven dividends of $300 each were so declared and paid to her. It is claimed on the part of the contestant that the executors should account for and be charged with such dividends. The representative of the estate of the widow was not cited upon the accounting; consequently the determination of this question should be postponed until the final judicial settlement of the accounts of the executors.

The propositions to which I have referred are the principal ones involved in this litigation. There are numerous other subjects of controversy to which I have not alluded in this decision, but I have endeavored to make my findings of fact sufficiently explicit in regard to each, that there may be no misapprehension as to the conclusions to which I have arrived. A decree will be entered in conformity to my findings of fact and conclusions of law herewith submitted.

Ordered accordingly.


source: Caselaw Access Project

author: ARNOLD, S.

license: Public Domain

text:
    In the Matter of the Petition of William Drane to Compel an Accounting by Elisha Flint, as Administrator, etc., of Frederick G. Flint, Deceased.

      (Surrogate's Court, Otsego County,

      Filed February, 1896.)

    1. Executors—Accounting.
    The holder of a claim for funeral expenses is not a creditor of the es= • tate within § 2727 of tne Code.

      2. Same.
    , Nor is he a “person interested” in the estate or fund, within the meaning of this term in said secuon.
    3. Same.
    Tlie holder of such claim, cannot obtain payment of it by proceedings in a surrogate’s court.
    Petition by William Drane to compel an accounting by Elisha Flint, as administrator of Frederick Gr. Flint, deceased.
    S. W. Barnum for petitioner; C. M. Bates for administrator.
   ARNOLD, S.

—Frederick Gr. Flint died on the 1st day of June, 1894, intestate. His only heir at law and next of kin is his brother, Elisha Flint. On the death of Frederick, Elisha engaged the petitioner here, who is an undertaker, to furnish a casket and render the necessary services in the burial of decedent. Soon after the funeral the undertaker duly presented his bill for $192 to Elisha Flint for the casket so furnished and the services so rendered. On the 4th day of October, 1894, Elisha Flint paid to the undertaker, on account of the bill so presented, the sum of $50.. The remainder of the bill is not disputed, but no further payment has been made. On the 4th day of December, 1894, Elisha Flint was duly, appointed administrator of the estate of- decedsnt, duly qualified and entered upon the discharge of his duties as such administrator, and is still acting as such. On the 6th day of January, 1896, the petitioner, William Drane, instituted these proceedings against the . administrator for a compulsory accounting and for payment of'his’claim. On the return day of the citation the administrator appeared and filed objections to the jurisdiction of the court to entertain the proceeding. No other proceeding has ever been taken to collect the claim, and no action has ever been brought for its collection. The administrator has sufficient assets to pay the same.

Every person has the right to a decent Christian burial. The common law casts upon some one the duty of seeing that the decedent is accorded that right. In the case at bar the duty was cast upon the brother, who is now acting as administrator of. the decedent’s estate. 2 Bl. Comm. 508 ; Reg. v. Stewart, 12 Adol. & E. 773 ; Rappelyea v. Russell, 1 Daly, 214 ; Ferrin v. Myrick, 41 N. Y. 315. The expenses incurred in this casé were reasonable and proper. If the administrator had paid them, as was his duty, he would be allowed for the amount so paid on his final accounting. ' But he neglects to pay the same, and it becomes necessary to consider the rights and remedies which the holder of such f a claim has to obtain payment. It seems to have long been the rule of common law that necessary funeral expenses should be allowed prior to other debts and charges. 2 Bl. Comm. 508.

The common practice is -for executors or administrators to pay these expenses before any others. An executor. is authorized by statute to pay funeral expenses, before letters testamentary are granted. 2 Rev. St. p. 71, § 16. It is certainly the duty of an administrator or executor to pay the funeral of the decedent from his estate. Ferrin v. Myrick, 41 N. Y. 315 ; Patterson v. Patterson, 50 N. Y. 582. The funeral expenses are a charge upon the estate. Id.

It seems that in many states an action may be maintained against an executor or administrator, as such, for the funeral expenses of the decedent, and that judgment may be rendered de bonis decedentis. Hapgood v. Houghton, 10 Pick. 254 ; Samuel v. Estate of Thomas, 51 Wis. 549 ; Seip v. Drach, 14 Pa. St. 352; Campfield v. Ely, 13 N. J. Law, 150. But this does not seem to be the modern English doctrine (Corner v. Shew, 3 Mees. & W. 350), nor the law of this state.' In this state the leading case in point seems to be Ferrin v. Myrick, 41 N. Y. 315. In that action it appeared that gravestones had been furnished to mark the graves of the administrator’s intestate. Suitable gravestones are a part of the funeral expenses. 2 Williams’ Ex’rs (9th Ed.) 171 ; Matter of Howard’s Estate, 3 Misc. Rep. 170 ; Owens v. Bloomer, 14 Hun, 206. The administrator bad sufficient assets of the estate in his hands to pay the same. Plaintiff, who furnished the tombstone, sued tlie administrator in his representative capacity, and the administrator filed a demurrer. The court, after carefully reviewing the authorities, say :

“The following principles are settled by these authorities : (1) That for all causes of action arising upon a contract made by the testator in his lifetime, an action can be sustained against the executor as such, and the judgment would be de bonis intestatoris. (2) That in all causes of action where the same arises upon a contract made after the death of the testator, the claim is against the executor personally, not against the estate, and the judgment must be de bonis propriis. That these different causes of action cannot be united in the same complaint.” Ferrin v. Myrick, 41 N. Y. 322.

The court further say, at page 825:

“It is certainly the duty of the executor to pay the funeral expenses .of the deceased from his estate, and’ it has been well held that suitable gravestones are a part of such expenses. 2 Williams’ Ex'rs, 871, and note ; 2 Redf. Wills, 224. The expenses do and should fall npon the estate and not upon the executor. But it does not follow, as a logical sequence, that an action at law can be maintained against the estate to recover the amount. I have endeavored already to show why the action should not be sustained against the executor as such, and why it may be sustained against him personally. It ought to be added that, in case of the fraud or insolvency of the executor, an equitable cause of action would probably be thereby created against the estate, which could be enforced in behalf of the creditor, and'which would enable him to maintain a claim against the estate directly.”

This case seems to have been cited with approval in many cases in the court of appeals and the lower courts. Austin v. Munro, 47 N. Y. 366 ; Casoni v. Jerome, 58 N. Y. 321; Patterson v. Patterson, 59 N. Y. 586 ; Cardot v. Barney, 63 N. Y. 288 ; Wood v. Tunnicliff, 74 N. Y. 46 ; In re Knapp, 85 N. Y. 297 Wetmore v. Porter, 92 N. Y. 82 ; Barry v. Lambert, 98 N. Y. 300, 516 ; Schmittler v. Simon, 101 N. Y. 558 ; Blood v. Kane, 130 N. Y. 520 ; 42 St. Rep. 549.

In the case at bar the contract was made with Elisha Flint individually, and under thé above authorities the undertaker would be obliged to sue him as an individual. He could not maintain an action against him as administrator in the first instance. 7 Am. & Eng. Enc. Law, 340. Can the undertaker maintain this special proceeding ?

Section 2727 of the Code of Civil Procedure provides that:

“A pe.ilion praying for the judicial settlement of an account, and that the executor or administrator be cited to show cause why he should not render and settle his account, may be presented in a case prescribed in the last section by a creditor or a person interested in the estate or fund. * * *”

Section 2514, subd. 3, defines the words “debts” and “creditor” as follows:

“The word ‘debts’ includes every claim and demand upon which a judgment for a sum of money, or directing the payment of money, could be recovered in an action ;• and the word ‘creditor’ includes every person having such a claim or demand.”

Subdivision 11 of said section defines the expression “person interested" as follows:

“The expression ‘person interested,’ where it is used in connection with an estate or a fund, includes every person entitled either absolutely or contingently to share in the estate or the proceeds thereof, or in the fund, as husband, wife, legatee, next of kin, heir, devisee, assignee, grantee or otherwise, except as a creditor. * * *”

The jurisdiction of surrogates’ courts must be exercised in the cases and. in the -fnanner prescribed by statute. Section 2472. It seems that, under the decisions, and under the definition above quoted, the holder of a claim for funeral expenses is not a “creditor” of the estate. These expenses are not to be treated as a “debt” against the decedent, but as a charge upon the estate, the same as the necessary expenses of administration. Patterson v. Patterson, 59 N. Y. 574, 585. See, also, cases above cited. This rule is universally recognized by the text writers, Crosw. Ex’rs & Adm’rs, § 391; Schouler, Ex’rs, § 421; Woerner, Adm’n, § 357; 2 Williams’ Ex’rs, § 169. Although the holder of a claim for funeral expenses is not a creditor of the estate, his claim is a first charge upon the assets of the estate is payable with the other expenses of administration, before the claim of any creditor of decedent. Patterson v. Patterson, 59 N. Y. 564; Ferrin v. Myrick, 41 N. Y. 315. Does this make him a “person interested" in the estate or fund, 'within the meaning of that expression as used in the Code? If it does he is entitled to maintain this proceeding.

To be a “person interested” one must entitled to “share” in the estate or the proceeds thereof, or in the fraud. Upon the facts above stated, is this petitioner now entitled to share with any one in the assets of the estate or the proceeds thereof?. Is he entitled to share in the proceeds of this estate with the surviving brother of decedent ? Under the above statement of law, it cánnot be that he is. He made his contract with the brother as an individual. He has his remedy for the collection of this claim. The law says his claim is against the Brother individually. The cases hold that, under certain circumstances, equity will step in and help him to collect the claim out of the testate of decedent; but no facts are shown here requiring the aid of equity, and this is probably not the tribunal in which the petitioner could obtain equitable relief, if he was entitled to the same.

In the administration of estates, there seems to be two classes of persons created by the Code who may be entitled to participate in the distribution of the assets," namely, “creditors" and “persons interested.” The creditors of an estate are entitled to be paid out of the proceeds thereof before there can be any distribution to the persons who are interested therein as “ husband, wife, legatee, next of kin, heir, devisee, assignee, grantee or otherwise.” The law creates another class, whose claims are a charge upon the estate, and who are entitled to.be- paid out of the assets before either “creditors” or “persons interested.” This class is composed of persons holding claims against the estate for expenses of administration. The cases hold that the expenses of administration are the funeral expenses, the expense of probating will or of obtaining letters of administration, the expenses of settling the estate, including necessary attorney and counsel fees. All these charges, which are necessarily incurred, and which are reasonable in the amount, [are to be first paid by the executor or administrator in the due course of administration. Although these charges are not created by the contract of decedent, the law recognizes that they are incurred for the benefit of the estate; that there is, therefore, an obligation on the part of the estate to pay the same, and it makes them a first charge upon it. Keener, Quasi Cont. 341, 344.

Upon the final judicial accounting of an executor or adminisstrator, the common law gave the probate courts the power to allow the executor or administrator, out of the estate, the expenses which he had necessarily incurred in the course of administration. Young v. Brush, 28 N. Y. 667, 673. The.power was afterwards conferred by statute. See 2 Rev. St. p. 93. § 58. And it is now provided in the Code that “in all cases such allowance must be made for their necessary expenses actually paid by them as appears just and reasonable.” Code Civ. Proc. § 2730. But, so far as I can find, it has always been held by these courts that persons holding these claims cannot obtain payment of them by proceedings in a surrogate’s court. Hoes v. Halsey, 3 Dem. Surr. 577.

Counsel for petitioner relies on Patterson v. Patterson, 59 N. Y. 582, Dalrymple v. Arnold, 21 Hun, 110 ; Laird v. Arnold, 25 id. 4, and In re Laird, 42 id. 136, to support his contention that the petitioner is a creditor of the estate of decedent, and that he is also a “person interested” in the estate.. Patterson v. Patterson simply holds that one who has paid the funeral expenses of a decedent is entitled to set the amount of such payment up as a counterclaim in an action brought, against him by the decedent’s personal representative. This right is recognized by all the authorities. The decision in the remaining cases seems to have been founded on chapter 267 of the Laws of 1874, which has been repealed by chapter 245 of the Laws of 1880. The provisions of chapter 267 of the Laws of 1874 do not seem to have been reenacted in any of the subsequent statutes. It is now held that the holder of a claim for funeral expenses is not entitled to maintain a proceeding for the sale of real estate to pay the same. In re Corwin’s Estate, 10 Misc. Rep. 196; 64 St. Rep. 10.

Under the law as it now stands, the estate of a person dying intestate is to be distributed as follows: (1) All charges upon the estate for expenses of administration are to be paid. (2) The creditors of the intestate are next to be paid. (3) The balance remaining after these payments is to be distributed among the “persons interested” bribe estate as “husband, wife” etc., according to their respective interests. The petitioner belongs to the first class, It follows that he is not, within the cases cited, and the definitions given in the Code, a “ creditor” or a “person interested” in the estate. He is, therefore, not 'entitled to institute these proceedings, and his petition must be dismissed. Petition dismissed.


author: CONLAN, J.

text:
    Francis Coleman et al., App’lts, v. James M. Hill, Resp’t.

      (New York City Court, General Term,

      Filed February, 1896.)

    A judgment creditor appeals from an "order dismissing the proceedings; the attorneys for the judgment creditors appeal from that part of the order directing that the costs be paid by such attorneys.
    Oppenheim & Severance, for app’lts ; Fromme Bros., for resp’t.
   CONLAN, J.

—So much of the order appealed from as directs that the costs allowed to the judgment debtor be paid by the attorneys appearing for the plaintiffs in this proceeding be reversed, and affirmed as to the remainder, without costs.


author: McADAM, J.—

text:
    In the Matter of the Refusal of License by Excise Board.

      (New York Superior Court, Special Term,

      Filed June 24, 1895.)

    Excise—Refusal of license.
    Mandamus will lie only, where the refusal to license is placed on grounds which are clearly arbitary or illegal, and not where the discretion of the board has been exercised and not abused.
    General decision in reference to review of refusal of license by excise board.
   McADAM, J.—

Several applications for certiorari and mandamus having been made and declined, it is proper that the rule regulating the granting of such writs should be stated.

The object of the act of 1892 (chapter 401) was not to convert the courts into excise boards, but merely to require a review of their action where an application for a license has been by such boards arbitrarily denied, or denied without good or solid reasons therefor. Section 24. In the two cases reviewed by this court the refusal to grant the licenses was placed exclusively on the construction of the statute respecting which the board was in error. The questions presented were entirely of a legal character, which the court, under the act, ivas bound to decide. But there are many questions concerning which the action of excise boards will not be disturbed. Such boards must, in the nature of things, determine whether the applicant possesses the qualifications required by section 18 of the act, whether the place is one which ought to be licensed, whether its proximity to a church or schoolhouse or to other saloons in the neighborhood makes it unwise and improper' to grant the occupant a license. The boayd, with its retinue ’ of inspectors, its facility for inquiry by evidence or otherwise, is peculiarly qualified to pass upon these questions; and their findings thereon must, in all but extreme cases, meet with approval. At all events, mandamus, which is a writ resting largely in disere tion, will lie only where the refusal to license.is placed on grounds which are clearly arbitrary or illegal, and not where the discretion of the board has been exercised, and not abused. The discretion of the court is not to be substituted for that of the excise board. The legislature has lodged such'discretion with the board, and it should remain there, except in a clear or an extreme case of abuse. Applicants must govern themselves accordingly.


author: LANSING, S.

text:
    In the Matter of the Judicial Settlement of the Accounts of James Keenan et al., as Executors and Trustees, etc., of Thomas Downing, Deceased.

      (Surrogate’s Court, Rensselaer County,

      Filed December, 1895.)

    1. Wills—Advancement—Interest.
    Nothing is to he allowed for increase or interest on advancements simply as such.
    2. Same.
    Interest is not to he charged upon advancements in case of intestacy.
    S. Same.
    Where a person dies testate, no interest can he charged unless the will, hy its terms or by necessary implication, requires it.
    4. Same—Vesting oe interest.
    A gift of the title to the real estate to the executors, with the right to receive the rent and profits, with direction to sell and divide the proceeds of the real estate upon the death of the widow among the several persons named, creates a power in trust, general and imperalive, and suspends the vesting of any interest in the proposed beneficiaries until the power is executed.
    5. Same—Lapse.
    When the limitation creates a tenancy in common, the gift being to several persons by name and not to them as a class, the share of the one dying before testator or before the time when it vests, is lapsed, and should be distributed as intestate estate.
    Judicial settlement of the accounts of James Keenan and others, executors and trustees of the will of Thomas Downing, deceased.
    Akin & Keenan, for executors and trustees James Keenan and John Magill ; McClellan & Albertson, for legatees and devisee Isaac Downing ; G. L. Stedman, for legatees and devisees Nancy Blackburn and Elizabeth Dunham.
   LANSING, S.

—Thomas Downing died in the city of Troy on the 9th day of April, 1886, leaving a last will and testament, which was duly admitted to probate by the surrogate of Bensselaer county June, 1886. The portion of the will chiefly in controversy here relates to the distribution of the proceeds of the sale of the real estate, and is as follows:

“From the proceeds thereof [the real estate] first to make the distribution of my whole estate among my children equal, estimating that my two sons Thomas and Isaac shall have received the eleven thousand ^dollars by me advanced to my said wife. If the distribution shall' not have been made so equal by. the distribution of my personal property, and, after making such equality, my said executors shall distribute the residue of the proceeds of my real estate equally among my five above-named children.”

At the time of his death he left, him surviving, his widow¡ Susan Downing, and children, Thomas Downing, Jr., Isaac Downing, children by his second wife, Susan and Nancy Black: burn and Elizabeth Dunham, children by a former wife. John J. Downing, a. child by his former wife, died intermediate the making of the will in 1881 and the death of the testator. Thomas Downing, for whom a special provision was made in the will by reason of his intemperate habits, died after the death of the testator, but before the death of his mother, Susan.

The testator by his said will gave all of his property, real and personal, to his executors in trust to distribute his personal property as follows: Nine-fifteenths among his wife Susan, and her children, Thomas and Isaac; but provided that the sum of $11,-000, which he states he had theretofore advanced to his wife, Susan, should be considered as a part of the nine-fifteenths of his personal estate to be given to her and her two sons in making such distribution. The remainder to be divided among his three children by his former wife, Nancy, Elizabeth, and the said John J. The testator provided that the executors should receive the rents of the real estate, and pay one-third, to bis wife, Susan, arid cne-fifth of the remainder to each of his five children during the lifetime of his wife. He also authorized his executors to sell any and all of his real estate, except the house in which he resided, the use of a portion of which he gave to his wife during her lifetime. At her death he directed that all of his real estate should be sold (if none had been sold prior to that time), and the proceeds divided equally among his children; but this division of the proceeds of the sale of his real estate was to be made upon the condition that, in making the prior division of his personal estate between the two branches of his family, there had been found sufficient personal estate to divide the same in the proportion of nine-fifteenths to Susan and he'r children, and six-fifteenths to his children by his first wife, estimating, in that division, that Susan and her sons, Thomas and Isaas, had received said sum of $11,-000 towards their.share. But in case there had not been sufficient of the personal estate to equalize it in the proportion above stated between the two branches of his family, which I have treated as classes for reasons hereafter stated, then the proceeds of the real estate should be brought in; and, estimating that Thomas and Isaac, the children of his wife, Susan, then deceased, had .re-" ceived the sum of $11,000 aforesaid, a division or equalization should be made so that each branch of his family should first receive its share in the proportion of nine-fifteenths to six-fifteenths, and the-remainder be divided equally among his children. He further provided that, if his son Thomas, who was an inebriate, should reform at or before he attained the age of thirty-five years, his executors' might pay him the principal of his share; otherwise, they should retain the same in trust during his life, and on his <l-'iitn pay the same to his heirs.

In March, 1888, the executors accounted to the surrogate forth e personal property of the deceased, and it was found that there remained for distribution only the sum of $3,935.27, - and that, bringing in the sum of $11,000 for the purpose of equalization, said sum of $11,000 exceeded nine-fifteenths, the share of his wife, Susan, and her sons, Thomas and Isaac; so the said sum of $3,935.27 was by the decree of the surrogate paid to his daughters by his former wife, Mrs. Blackburn and Mrs. Dunham. On the 7th of January, 1895, Susan Downing died, and by her will, which was duly admitted to probate, she devised all of her property to-her son Isaac; her son Thomas having died in 1891, leaving a will by which he devised all of his property (none having been actually received by him from the estate) to his mother. The executors and trustees have sold the real estate of the deceased sines the death of Susan Downing, and there remains in their hands for distribution under said will the sum of $7.351.97.

There are several important legal questions, arising under this will, which must be decided before this estate can be distributed. As we have seen, the widow, Susan, and her children took nothing upon the distribution of the personal estate under the decree of the surrogate, and it is insisted by Mrs. Blackburn and Mrs. -Dunham, children of the former wife, that interest must now be added to the sum of $11,000, previously advanced to Susan, from the time of the judicial settlement of the estate in 1888 to the present time. If this contention is allowed, they will receive nearly all, if not all, of the balance of the testator’s estate. This presents an important question in this case, namely, should" interest be allowed upon the sum of $11,000 advanced by the testator to his widow, Susan ? I do not find many authorities in this state upon the question of interest upon advancements. The case of Verplanck v. De Went, 10 Hun, 611, is cited as a case in point by counsel for Mrs. Blackburn and Mrs. Dunham. That case simply holds that the proper construction of the will in that case required the sum of $5,000, advanced to a legatee, to be treated as a debt, and it, therefore, should draw interest from the time the debt became due; but it does not support the general proposition that advancements, as such, draw interest. It is settled by numerous authoritative decisions in other states, and also in the courts-of England, that nothing is to be allowed for increase rain terest on advancements simply as such. See Williams, Ex’rs (7th Ed.) 1606, note G, where numerous authorities are cited in support of this proposition,—amoug others, Black v. Whitall, 9 N. J. Eq. 572; Osgood v. Heirs of Breed, 17 Mass. 358; Nelson v. Wyan, 21 Mo. 347 ; McCaw v. Blewit, 2 McCord, Eq. 90; Pigg v. Carroll, 89 Ill. 205. These cases proceed upon the ground that, an advancement is no part of the estate to be administered upon, Consequently advancements as such never draw interest.

The only case which I have been able to find in this state, except the one cited from Hun, is Ex parte Oakey, reported in 1 Bradf. 281, where the learned surrogate (Bradford) says:

“Nothing is said in the will as to interest, and in the absence of any express direction on that point, no more can be deducted from the share of the legatee than the principal sum advanced.”

The surrogate cites Andrewes v. George, 3 Sim. 393, which holds intex-est may be computed on advancements made by 'a father to his children from the time that the property was to be divided among them only.

It appears to be well settled from the authorities cited that interest is not to be charged upon advancements in case of intestacy. See, also, 1 Rev. St. p. 754, § 25, which declares, except when the child stipulates in writing as to the value of property received,“such value shall be estimated according to the worth of the property when given.” It follows that, where a person dies 'testate, no interest can be charged unless the will, by its terms or by necessary implication, require it. The will in this case directs that the $11,000 shall be brought in for the purpose bf equalizing the testator’s estate among his children, but it does not provide, in terms, that interest shall be added, nor do I think the will; by any fair construction of its provisions, requires it. It is apparent that the testator apprehended that the $11,000 advanced to his wife, Susan, might exceed the nine-fifteenths of his personal estate; for he provided that, before an. equal .division of his property should be •made among his five children, the whole of, the estate, real and-personal, should be brought together, and a division made between them, the two branches of his family, in the proportion above stated, based upon the assumption that the children by his last wife had received the $11,000 advanced to her. It seems to me that this sum of $11,000 -is simply used as a factor for the purposes of equalization ; in other words, it is only to be used in making the share of Susan’s children nine-fifteenths of the entire estate before an equal division should be made among all of his children. There is no claim that the children of the second wife have actually received this $11,000; so that, as to them, it is neither technically nor substantially an advancement.

- Again, the testator is supposed to know the situation and value of his property, and the result tends to show that he did. It is obvious, also, that he supposed he had sufficient property to make a substantial division among his five children, after his property had been equalized and divided in the proportion of nine to six (including the $11,000) between the two branches of his family, for he provided that one of his children by his last wife, Thomas Downing, should have his share remain in the hands of his (testator’s) trustees, under a certain contingency, during liis lifetime, and the income thereof paid for his maintenance and support—a provision which would be unnecessary if he intended that the provision which he had made for his wife should draw interest “until the ultimate division of his property, since he obviously contemplated (by the provision he made for her) that her life, would be protracted many years, in which case, by the addition of interest, there would be nothing, or substantially nothing, to divide among her children after her decease. This provision for his wife was doubtless provided so that the income thereof should furnish her support during her life, and it would be manifestly unjust, and not within the intention of the testator, to cl large his children by her with the income which he had provided for her support. I=am quite clear that it is not within the intent of the testator, as disclosed by his will, to have interest charged upon the said $11,000 upon the present division of his estate.

It has been suggested that interest at least should be charged from the death of his wife, Susan, which occurred January 7, 1895, at which time the division of his estate was to be made. I think the better view is that the division contemplated was the division to be made by the executors on the judicial settlement of their accounts, proceedings for which were instituted by the executors as soon as practicable after the sale of the real estate. I am also of the opinion that the contention of Isaac Downing, a son of the last wife, that the amount received by the children of .the first wife, Mrs. Dunham and Mrs. Blackburn, upon the division of the personal property, January 21, 1888, of $3,935.27 under the decree of the surrogate, should draw interest from that date, is untenable. This amount was paid to them in pursuance of the will by a decree of the surrogate, and, although it .is to be considered as a part of the estate in the ultimate division, for the" purpose of making their six-fifteeiiths of the estate before ultimate division shall be made among all the children, yet I see no reason why it should draw interest. It is not an advancement. It was received by them under a decree of the court, and constitutes so much of their share in the ultimate division of the estate. It is not a debt which they owed the estate, but is theirs of right. I do not think it was contemplated by the testator that these children should pay interest upon the amount they received on the distribution of the personal estate, nor do I find any principle of law which requires them to make such payment. The claim of interest on said sum is disallowed.

Another contention on the part of Isaac Downing is that the share of Thomas Downing, Jr., his brother, who died before the death of his mother, Susan, and, consequently, before receiving any portion of this estate, leaving a will by which he devised said interest to Isaac, should be paid to him. I cannot agree with this contention. In the first place, the will plainly provides that, in case the said Thomas Downing, Jr., should not be paid the principal of his share during his lifetime, that the executors of Thomas Downing, Sr., should pay the share of the said Thomas Downing, Jr., to “ his heirs at law,” who are the said Isaac and his two half-sisters. The.statute provided that children of half-blood shall take equally with those of the whole blood. 1 Rev. St. pt. 2, c. 2, § 15. But it is insisted by the said Isaac that the individual interest of Thomas Downing Jr., became vested on the death of his father, and was, consequently, alienable and devisable during the lifetime of his mother, Susan, and that the same came to him, the said Isaac, under the will of his mother. The real estate in this case is given to the executors in trust to receive the rents and profits of the said real estate and divide .the same, as provided, during the lifetime of the widow, and upon the further trust to sell the real- estate and divide the proceeds among the heirs of the said Thomas Downing. The gift of the title to' the real estate to the executors, with the right to receive the rents and profits, with direction to sell and divide the proceeds of the real estate'upon the death of the widow among the several persons named, created, a power in trust, general and imperative (1 Rev. St. pt. 2, c. 1, tit. '2 art. 3, §§ 74, 76, 79, .94), and suspended the vesting of any interest in the proposed beneficiaries until the power was executed. Delaney v. McCormack, 88 N. Y. 174, 183; Dana v. Murray, 122 N. Y. 604, 612; 34 St. Rep. 611.

The case of Delafield v. Shipman, 103 N. Y. 463; 4 St. Rep. 247, is much in point. In that case the court, through Earl J., say:

“The whole income is not given to the children during the life of the widow, and during her life the estate is vested in the trustees. There is no direct gift to the children, but simply ,a direction for a division among them after the death of the widow.”

In such case the titlejs not vested in the children during the life of the widow. ,

In the case of Warner v. Durant, 76 N. Y. 183, Folger, J., says:

“Where there is no gift” but by direction to executors and trustees or divide and to pay at a future time, the vesting in" the beneficiary will not take place till that time arrives.”

In the case of Smith v. Edwards, 88 N. Y. 92, Finch, J., giving the opinion of the court, says:

“It has, been often held that, if futurity is annexed to the substance of the gift, the vesting is suspended; * * * that, where the only gift is in tile direction to pay or distribute at a future time, the case is not to be ranked with those in which the payment or distribution only is deferred, but is one in which time is of the essence of she gift.”

This leads to the conclusion that the individual share of Thomas Downing, Jr., in the remainder of the estate, if any shall be due' him, must be equally divided among his brother and half-sisters.

The remaining question is what becomes, of the share of John J., who died before the death of the testator, leaving no deseendents. Ordinarily, under a well-settled rule of construction, when the limitation creates a tenancy in common, the gift being .to several persons by name, and not to them as a class, the share of the one dying before the testafor, or before the time when it vests, is lapsed, and should be distributed as intestate estate. Downing v. Marshall, 23 N. Y. 366; Gill v. Brouwer, 37 N. Y. 549; Jarm. Wills, 538. While the law infers a personal legacy to each child, when there are several, from a specification of them by name, yet the rule is not inflexible. The substantial intent of the testator must control, rather than the words. Hoppock v. Tucker, 59 N. Y. 203, 208; Stedman v. Priest, 103 Mass. 296. I am of the opinion, from an examination of the will, in connection with the conceded facts in the case, as I have above .indicated, that, as to the first division (the personal and so much of the pro-seeds of the real estate as "may be necessary to complete it), the testator intended to make a division between the two branches of his family by class, so that the death of John J. occasioned no lapse, although he was made a tenant in common, since the members of the class antecedently dying were not actual objects of the gift, and the entire subject of the gift vested in the survivors. Downing v. Marshall, supra. As to the present division of the remainder of the estate, the language of the will is quite clear that the'intestor intended to lie divided among his children as in lividuals. The language is, “The remainder to be divided equally among mv live children above named.” In which case it follows that the share of John J. in the remainder either lapsed and fell into -the body of the estate, and as to that portion the testator died intestate, or that it, became a portion of the remainder to be divided among testator’s children. In either event it would take the same direction, and be ultimately divided among the remaining children of the deceased.

Decreed accordingly.


author: PRYOR, J.

text:
    Henrich Haase, Pl’ff, v. William T. Levering, Def't.

      (New York Common Pleas, Special Term,

      Filed March, 1895.)

    1. Attachment—Discharge—Poundage.
    Section 709 of the Code does not entitle the sheriff to poundage, on discharge of an attachment by filing an undertaking by defendant.
    2. Same.
    In tbe ahsenre of proof, compensation is not allowable to the sheriff for trouble ai d expense in taking and preserving the property.
    Motion to release the sheriff’s lien for poundage.
    Hirsch & Rasquin, for pl’ff; Davison & Chapman, for def’t.
   PRYOR, J.

—The sheriff demands poundage on goods attached. The attachment has been discharged by an undertaking. By section 709 of the Code, on the discharge of an attachment, the sheriff must, deliver the property to the plaintiff on payment of all costs, charges and expenses legally chargeable by the sheriff; that is, at the time of the discharge. The action not being settled or determined, it is uncertain what amount, if any, the plaintiff will eventually recover; and no sum exists, therefore, on which to compute -poundage. By section 3307, subd. 2, of the Code, if the action be settled, the sheriff may have poundage “upon the value of the property attached not exceeding the sum at which the settlement is made.” But the action is not settled, and is proceeding to a result' which cannot be anticipated. In the absence of proof, compensation is not allowable to the sheriff for trouble and expense in taking and preserving the property. Nestor v. Bischoff, 123 N. Y. 517; 34 St. Rep. 425. The risk incurred by the sheriff from the possession of the property is no ground for a claim of poundage. Flack v. State, 95 N. Y. 461. 469-471.

The conclusion is that the claim for poundage be disallowed.


author: PARKER, J.

text:
    Clarence W. Wood et al., Resp’ts, v. Sidney Sash, Blind and Furniture Company et al., App’lts.

      (Supreme Court, General Term, Fourth Depm'tment,

      Filed December, 1895.)

    1. Pleading—Misjoinder of causes.
    Where any unlawful transfer, both through the sales under judgments and prívale sale, is netted as an act done in pursuance of one tclieme, a complaint trained upon the theory that in equity a right elists on behalf of the plaintiff to have anything that was done in pursuance of that scheme adjudged frai dulent and void, and to require all those who had re-eived any prep u-ty through it to account for the amount so received, does not impvc pjrly join two causes of action.
    2. Same—Parties.
    ' All persons who did in any manner participate in such transaction and receive anything through it, are properly made paities.
    3. Same—Demurrer.
    Such a complaint is not demurrable on the ground that two causes of action are improperly joined,
    4. Same.
    In any case, such action must be deemed an attempt by judgment creditors to reach in a single action property unlawfully” transferred to different persons by separate and distinct transfers, and in pursuance of.separarate and distinct agí eemants.
    Appeal from an interlocutory judgment overruling the demurrer to the complaint. ¡j
    Albert F. Gladding and James R. Baumes, for app’lts ; Albert T. Benedict, for resp’ts.
   PARKER, J.

—The complaint in this action avers that the plaintiffs are judgment creditors of the defendant the Sidney Sash, Blind & Furniture Company; that the defendants the First National Bank of Earlviile, the Sidney National Bank of Sidney, N. Y., and Charles G. Brooks conspired together with the defendant the Sidney Sash, Blind & Furniture Company, an insolvent corporation, to obtain for the said banks, which were large creditors of such corporation, an unlawful preference in the payment of their debts. It then proceeds to state the manner in which that preference was secured, substantially as follows: Judgments in favor of the banks were suffered by the insolvent corporation to be taken against it, and through executions issued "thereon, all the personal property of the corporation that could be sold on execution was sold, and the price realized on such sale was applied upon the judgments. It is also averred that such property was bid off by the banks at a much less sum than it was fairly worth. Luch judgments also became and still stand as prior liens to those of the plaintiffs’ judgments upon the real estate of such corporation. In order to reach the book accounts and choses in action of such corporation, a pretended sale was made to the defendant Brooks of about $15,000 worth thereof for the pretended sum of $7,000, and Brooks took an assignment of the same for the benefit of such banks. It does not appear that Brooks was a credi tor of the insolvent corporation, or had any interest in its property or in any of the transactions above stated, save as an assistant to the banks. He took and holds the property so assigned to him solely for their benefit, and to enable them to gain an unlawful preference thereto. The relief sought is that the judgments so obtained be declared void and of no effect as liens prior to those of the plaintiffs’ judgments, that the defendant banks account for and pay over to a receiver of the corporation all that they have received or taken under and by reason of such judgments, and that said Brooks and the defendant banks account to such receiver for the value of the accounts so transferred to Brooks.

It is argued by the appellants’ counsel that such complaint improperly joins two causes of action,—the’ one against the corporation and the banks to set aside the judgments so unlawfully suffered to be taken, and the transfer of property obtained through them, in which the defendant Brooks has no interest whatever, and the determination of-which cause of action would in no way affect Brooks; the other a cause of action to set aside the transfer of the accounts and choses in action to Brooks, which he holds for the benefit of the banks, and in which it would seem that all the defendants are interested. It is true that the facts set forth in the complaint may be so grouped and arranged as to present the two distinct causes of action above stated, but it is also evident that the pleader had no such plan in his mind when he drew such complaint. He based his right of action upon the fact that the defendant the Sidney Sash, Blind & Furniture 'Company, being indebted to the plaintiffs in a large amount, and being utterly insolvent, had under an arrangement with the other defendants, unlawfully appropriated all of its property to securing and preferring the debts of the two banks, and that in the transaction by which it was done Brooks had received, and still holds, some of the property so unlawfully applied. The unlawful transfer, both through the sales under the judgments and the sale to Brooks, is treated as an act done in pursuance of one scheme, and the complaint is framed upon the theory that in equity a right existed on behalf of the plaintiffs to have anything that was done in pursuance of that scheme adjudged fraudulent and void, and to require all those who had received any property through it to account for the amount so received. All persons are therefore made parties who did in any manner participate in such transaction, and received anything through it. The following cases are a plain autlrority that such an action may be brought and such a complaint sustained: Brinkerhoff v. Brown, 6 Johns. Ch. 139; Fellows v. Fellows, 4 Cow. 682; Boyd v. Hoyt, 5 Paige, 65. True, these cases were decioed before the Code of Civil Procedure, but the ground upon which the decisions are put is that in such cases there is but one cause of action averred; and if that be so, then such a complaint is not demurrable on the ground that two causes of action are improperly joined. See, also, the following cases, decided since the Code of Civil Procedure: Holmes v. Abbott, 53 Hun, 617; 25 St. Rep. 644; Oakley v. Tugwell, 33 Hun, 357 ; Morton v.Weil, 33 Barb. 30; Newbould v. Warrin, 14 Abb. Prac. 80. But, even if the analysis of the complaint which the appellants’ counsel has made is the correct and only one of which it is ■ susceptible, and the action must be deemed an atterhpt by judgment creditors to reach in a single action property unlawfully transferred to different persons by separate and distinct transfers, and in pursuance of separate and "distinct agreements, vet the case of Reed v. Stryker, 12 Abb. Prac. 47, is a direct authority that such a complaint must be sustained. That decision was made by the court of appeals deliberately overruling a judgment of this court to the contrary. It was made while a section of the Code of Procedure substantially like section 488 of the Code of Civil Procedure was in operation, and it has never been modified or criticised .by any decision to which our attention has been directed. On the contrary, it is accepted by Justice Mason as having settled the rule in this state. See Newbould v. Warrin, 14 Abb. Prac. 86. An examination of the report of the case in Reed v. Stryker, 6 Abb. Prac. 109, shows that the precise-question was in that case which the appellants’ counsel raises in this, and, notwithstanding his very able argument to the contrary, we must consider that case as decisive against him. As to the claim that there is a misjoinder of parties plaintiff, the cases above cited seem to be decisive against it. Also, see Bank v. Farthing, 101 N. Y. 344, 347. The judgment on the demurrers should be affirmed, with one bill >f costs to the plaintiffs only, and the defendants should have leave to answer within twenty days after a certified copy of the order herein is served Upon them, and upon payment of the cost of the demurrers of this appeal.

Interlocutory judgments affirmed, with one bill of costs only to the plaintiffs, and leave granted to the defendants to withdraw their demurrers and answer within twenty days, upon payment of costs of the demurrers and of this appeal.

All concur.


author: WILLIAMS, J.

text:
    Adolph Green, Resp’t, v. John R. M. Hernz, as Executor, etc., et al., App’lts.

      (Supreme Court, Appellate Division, First Department,

      Filed March 6, 1896.)

    Vendor and purchaser—Incumbrances.
    A sale of property for unpaid taxes which remains unredeemed constitutes an incumbrance upon the property, on account of which the purchaser is entitled to, recover back the purchase money paid and the expenses incurred, where the vendor refuses to redeem.
    Appeal from a judgment in favor of plaintiff,- entered on the decision of the court.
    ' The contract was made April 28, 1892, for" the sale of the property by defendant, Hernz, to plaintiff for the consideration of $9,300, to be paid $300 cash upon the execution of the contract, and $6,000 by a bond and mortgage, and $3.000 cash at the time of the delivery of the deed, May 16,1892. The contract provided that on receiving such payment and bond and mortgage the defendant should give the proper executor’s deed. At the time the contract was executed the plaintiff paid $300 in cash. The plaintiff caused the title of the property to be examined, and necessarily expended for that purpose $250. The time for the payment of the $3,000 and delivery of the bond and mortgage and deed was extended by agreement of the parties until May 26, 1892. On tliis latter day the parties met, and the plaintiff objected to taking the title, upon the ground, among others, that there was a tax sale upon the property, which was unredeemed. There was not then or at any other time anything said by the defendant, or any offer made to him to redeem the property from the tax salo, but he told the plaintiff that if he wanted to get his rights he could sue for them, and that was all he could do. The plaintiff thereupon demanded the repayment of the $300 paid to him under the contract, and the $250 expenses of examining the title, which was refused. The plaintiff was at that time able to perform the contract on his part. Upon the trial it appeared that this property was sold in 1886 for the taxes of 1882, and upon that sale the city of Hew York became the purchaser, and that the property was not redeemed from such sale until February 16, 1893; this action having been commenced in August, 1892. Upon this evidence the court ordered judgment for the plaintiff for the $300 and the $250, on the ground that the defendant was not, May 26, 1892, the owner in fee of the property, free from all incumbrances, by reason of the unredeemed tax sale.
    Ambrose G. Todd, for app’lts ; Henry M. Goldfogle, for resp’t.
   WILLIAMS, J.

—There can he no doubt but that a sale of property for unpaid taxes which remains unredeemed would constitute an incumbrance on the property. It is claimed that there was no proof given on the trial of unpaid taxes and a sale of the property therefor. These facts were proved by parol without the production of any documentary evidence, but there was no objection of any kind made to the proof given. If there had been, the plaintiff might have met such objection by producing such documentary evidence. The defendant should hot be permitted to claim now that these facts were not sufficiently established. Moreover, it appears that there was a redemption from tliis tax sale after the action was commenced, by the payment of the taxes and such other amount as was necessary to effect such redemption. There can be no doubt but that such unpaid taxes and sale of the property therefor constituted at least an incumbrance upon the property. The title offered to the plaintiff was, therefore, not free from incumbrance, and the plaintiff could not be required to pay the balance of the purchase money, and deliver his bond and mortgage, and accept the deed, until such incumbrance had been extinguished or removed. This incumbrance was distinctly pointed out at the rime the contract was to be consummated, and the defendant, instead of removing the same, or offering to do so, practically refused to remove it by telling the plaintiff, if he wanted, to get his rights, to sue for them; that was all he could do. Under these circumstances we are unable to see how the plaintiff could be required to do anything himself to remove the incumbrance. If any suggestion had been made by the defendant that the plaintiff should do this, and should use a part of the purchase money remaining unpaid for that purpose, it might then be claimed that he was under obligations to do so, or to furnish money sufficient to make the redemption ; but no such condition of things was presented, and the plaintiff could only decline to carry out the contract by reason of this incumbrance, or take the title subject to the incumbrance, pay the whole balance of the purchase price to the defendant, and remove the incumbrance at his own expense. • He had, under these circumstances, a legal right to refuse to consummate the contract, and was entitled to sue for and'recover back the part of the purchase money already paid, and the expense of examining the title.

Our conclusion, therefore, is that the case was properly decided by the trial court, and that the judgment shall be affirmed, with costs.

All concur.


author: PAKER, J.

text:
    Village of Oneida, Resp’t, v. T. Augustus Thompson et al., App’lts.

      (Supreme Court, General Term, Fourth Department,

      Filed December, 1895.)

    1. Municipal corporations—Collector’s bond.
    Where the charter requires a tax collector to pay over all money collected within the time prescribed by his warrant, and his bond requires him to faithfully execute the duties of his office and pay over all moneys as provided by law, the collector and his sureties are liable for moneys lost by the failure of a bank in which he has deposited them.
    S3. Statutes—Repeal.
    An act repealing an old, and granting a new, charter, and providing that it shall not affect any privilege or vested right, saves the right to sue a tax collector for his default.
    Appeal from a judgment in favor of plaintiff,
    B. A. Ransom, for app’lts ; H. W. Coley, for resp’t.
   PAKER, J.

—The trial court has found as a fact, in this matter, that the money collected by the defendant Thompson, as collector of the village of Oneida, were deposited to his credit in the banking house of E. C. Stark & Co., and that the balance, for which this action is brought, remained to his credit when such bankers made their assignment. It further finds that such sum has never been pair over to the treasurer of such village, and we are satisfied from the evidence upon that question that such finding should not be disturbed. The question is therefore presented as to what measure of liability should be imposed upon the collector and his sureties for the loss so sustained.

In the Faulkner Case (People ex rel. Nash v. Faulkner, 107 N. Y. 477, 487 ; 12 St. Rep. 273) it is said that the question is still an open one whether, when a case arises against an officer for not paying over and accounting for public moneys intrusted to him in his official capacity, his liability, in the absence of statutes specially defining it, shall be governed by the common law, or whether the board and more rigid rule of responsibility laid down in the case of Muzzy v. Shattuck, 1 Denio, 233, shall be enforced in this state. In that case it was not considered necessary to determine that question, because the moneys received by the surrogate, the defendant therein, were not deemed public moneys. That suggestion was adopted by this court in the Tillinghast Case (Tillinghast v. Merrill, 77 Hun, 481 ; 60 St. Rep. 549) ; and the question was there considered as an open one. It refused to accept the rule adopted'in the Dorr Case (Supervisors v. Dorr, 7 Hill, 583), and held the defendant liable, though the moneys were lost by him in precisely the same way in which they were lost by the defendant in the case now before us. Its decision was placed, not upon the theory that there'was anything in the bond of the supervisor, the defendant in that case, nor in the statue regulating his liability, that enlarged his common-law obligations, but upon the ground that the weight of authority was in favor of holding such officers as debtors to the town for the public moneys received by them. Such was the conclusion of law found by the trial court in that action, and such conclusion was affirmed on that appeal. That decision seems to be controlling in the case now before us. It is true that there is some difference in the phraseology of the conditions of the bonds and of the statutes imposing the liability in the two cases, but that difference is immaterial, inasmuch as in neither does the statute or the condition of the bond, in terms or by necessary implication, impose the obligation of a debtor upon either officer. Moreover, though different in their phraseology, they are alike in substance. In the case now before us the condition of the bond is that the officer will faithfully execute the duties of his office, and pay over all moneys as provided bv law. The law—section 46 of the village charter (Laws 1886, c. 81)—re-quired him to pay over to the treasurer all moneys collected by him within the time fixed for the return of his warrant. In the Tillinghast Case the officer was required to faithfully disburse, safely keep, and account for the moneys received by him. In the event of his default, the treasurer was directed to sue on the bond for the benefit of the town, and to pay over the amount received to the town. There was nothing in the statute indicating that the officer giving the bond sued upon was to be held to any greater liability than an honest discharge of his duties and a faithful paying over of moneys not properly disbursed. In either-case the measure of liability is the same, and -there was no more ground for holding the supervisor liable as a debtor or otherwise in the Tillinghast Case than there is for .holding the collector liable in the case now before us. This case cannot be distinguished from the Tillinghast Case, and the rule three adopted must be apjjlied to this.

As to the objection that the village of Oneida, as now reincorporated under chapter 620 of the Laws of 1894, has no right to maintain this action, we do not' consider it well taken. The cause of action which the village of Oneida, as incorporated under the former acts, had against these defendants, was not destroyed by the repeal of such acts. The evident intent of the legislature was to preserve all such rights tb the village of Oneida under its new charter, and such, we think, it has done, by setion 10 of title 11 of such charter. It is there declared that the repeal of the former acts shall not affect “ any privilege granted, or right vested,” when such repeal should take effect. The judgment of the court below must be affirmed, with costs.

Judgment affirmed, with costs.

All concur.