Hannah v. . Hyatt

Wauker, J., after stating tbe case: There are five questions presented by tbe defendants’ exceptions to tbe report of tbe referee and to tbe rulings of tbe judge thereon. First. Tbe referee held that tbe money derived from tbe sale of that part of tbe “Love Speculation Land” which is known in tbe case as the *638 “Cold Mountain tract,” it being $4,258.83, was received by tbe defendant R. A. L. Hyatt by virtue and under color of bis office, and therefore his sureties were liable with him for any default in respect to that fund. The judge confirmed this ruling of the referee, and we concur therein. The clerk was appointed, in his official capacity, to make the sale and receive, invest, and disburse the imoceeds of the sale made by him, and this Court has often adjudged that in such a case, as he acts officially, he is necessarily liable in the same way for any failure to properly discharge the duties of his trust. The Judges v. Deans, 9 N. C., 93; State ex rel. Saunders v. Gaines, 30 N. C., 168; Broughton v. Haywood, 61 N. C., 380; Cox v. Blair, 76 N. C., 78; McNeill v. Morrison, 63 N. C., 508; Boothe v. Upchurch, 110 N. C., 62; Kerr v. Brandon, 84 N. C., 128; Waters v. Melson, 112 N. C., 89. In Kerr v. Brandon, supra, the Court held that the appointment of the incumbent of the clerk’s office as receiver of an infant’s estate did not impose any liability upon the sureties who signed his official bond; but there he was not appointed receiver in his official capacity as clerk, but independently; and in Boothe v. Upchurch, supra, Justice Avery refers to that case, and states that the act of 1868 (Battle’s Rev., ch. 53, sec. 22) was afterwards amended, to meet the decision of this Court therein, by The Code, sec. 1585 (Revisal of 1905, sec. 1813). . In Waters v. Melson, supra, Shepherd, G. J., further explains and distinguishes the case of Kerr v. Brandon, supra. But it will be seen by a careful examination of the latter case that the reasoning of the Court sustains fully our conclusion that the clerk’s bond is liable for this fund. See, also, Thomas v. Connelly, 104 N. C., 342, and Smith v. Patton, 131 N. C., 396. In the case last cited the present Chief Justice states the rule definitely and collects the principal authorities. No further discussion, therefore, is required. Second. As to the payments to "W. "W". Stringfield from 4 August, 1908, to 1 June, 1909, both dates inclusive, amounting to $550 in all, the court was clearly right in reversing the referee’s ruling by which defendant was charged with that sum and interest. The amount was paid by defendant to Stringfield under an order of the court previously made, and it authorized the disbursement for services rendered the estate.. The mere fact that the order had been lost cannot deprive the defendant of his right to the credit. There is not any doubt as to its having been made, and the referee finds that it was made and signed by the court. As this finding of fact was approved by the judge, it concluded the matter. The failure to record the order could not prejudice the defendant’s right to pay or W. ~W. Stringfield’s right to receive the money. In re Blade, 162 N. 0., 457, 459. But while this is true, we do not see that the plaintiff is in any position to object to this ruling. He *639 bas not perfected any appeal or assigned any errors. The judge properly overruled the referee’s conclusions of law upon this finding. Third. The exception of the defendant as to the charge of interest at the rate of 5 per cent on the fund realized from the sale of the “Cold Mountain tract” must be sustained. He should be charged only with interest at the rate of 4 per cent, the amount he received. The defendant was ordered by the court to deposit this fund, less the amount of the payment to Hugh A. Love, in the Bank of Waynesville and take for the same a certificate of deposit payable to himself and bearing “the best rate of interest obtainable for the same.” He complied with this order as nearly as the requirements of the trust and the necessity of his cheeking upon the fund would permit. The court afterwards ordered certain amounts to be paid from this fund by the clerk, and he could not comply with the order without drawing checks on the bank for the same. In order to deposit the fund so that it would draw interest at the highest rate, and at the same time be subject to his checks, he agreed with the bank to deposit the fund with it at 4 per cent interest, this rate being the best he could secure on a checking account. It appears by the findings of the referee, approved by the court, that the bank would not allow 5 per cent, or any greater rate than 4 per cent, unless the entire amount was allowed to remain in the bank for six months on special deposit, called “time deposit” or “certificate of deposit” in the referee’s report. As to the proceeds received from the .sale of the Martin tract, which was $1,020, he was not able to deposit it so that it would draw interest, as in the case of the other fund. We are unable to understand, though, why the contention of- the plaintiffs is not the correct one, that defendant should have checked first upon the noninterest-bearing account in the bank before he resorted to any part of the other deposit which bore interest. The referee and the court ruled in accordance with this contention, and the account, in this respect, was properly stated. The defendant was not charged with any interest on the fund derived from the sale of the Martin tract of land, $1,020, and was allowed commissions on the same. He should be charged only with interest at the rate of 4 per cent on the other fund, as that was all he received or could have obtained under the circumstances, and his management of this fund was in substantial compliance with the order of the court. There is no evidence that he applied any part of the money to his own purposes or that he made any profit therefrom for himself. Fourth. The exception by defendant as to the charge of 12 per cent interest after plaintiffs’ demand for payment under Revisal, sec. 284, cannot be passed upon without additional findings of fact. It appears by the plaintiffs’ own admission in the testimony that the parties agreed to settle, and were proceeding to do so, when the plaintiff “broke up the settlement” because he was not willing to allow the defendant the receipts *640 for tbe money paid to W. W. Stringfield. If defendant was able, ready, and willing to pay tbe defendant all tbat was tben due, except tbat item, and offered to do so, or if plaintiff refused to accept tbe undisputed part, if there was sucb a part, unless tbe Stringfield receipts were excluded from tbe settlement, and not allowed in reduction of tbe amount to be paid by defendant, the defendant was not in default, but tbe fault was all tbe plaintiffs’, and tbe latter could not recover tbe higher rate of interest. It was held in Bond v. Cotton Mills, 166 N. C., 20, 23, tbat “interest, by way of damages, is not allowed as a conclusion of law, unless there has been some adequate default on tbe part of a debtor in reference to withholding tbe principal sum or a part of it,” citing several authorities, tbe exception being in those cases governed by Revisal, sec. 19 54. ¥e cannot decide tbe question, though, without specific findings as to what was done by tbe parties at tbe attempted settlement, and as to what amount, if any, was tben in the defendants’ bands and due to tbe plaintiffs, tbe amount paid to Stringfield being allowed to defendant as a credit. Was there any clear balance? If so, bow much? If there was a balance, defendant’s liability for tbe higher rate of interest will depend upon whether a tender was made by him of it or whether a tender was excused by tbe conduct of plaintiff. Tbe facts may be found by tbe judge, a referee, or otherwise, as provided by law, unless tbe parties can agree upon them. When they are ascertained, tbe judge will rule upon them as to this item of interest. Fifth. Tbe defendant should have been allowed bis commissions. We see nothing in bis conduct of tbe business to indicate tbat be was unfaithful to bis trust. It is said in 18 Cyc., 1162, where tbe law is fully and clearly stated, tbat compensation should be allowed unless there has been some act or omission calling for punishment. In this case there is no evidence of fraud, willful default, or gross negligence which caused detriment to tbe estate, but it appears tbat it has been benefited by tbe services rendered. We find nothing in tbe report of tbe referee or in tbe administration of bis trust by defendant to indicate any conversion, misapplication, or commingling of funds, or any other improper conduct in receiving and disbursing tbe same. It would not be right tbat plaintiff, and those be represents, should enjoy tbe benefit of defendant’s services and not pay him for them. 18 Cyc., 1162, 1163, 1164, 1165. This Court said in Perkins v. Caldwell, 79 N. C., 441, 445: “It is stated by bis Honor that tbe executor acted in good faith and with strict integrity, and as we see nothing to tbe contrary, there i.s no reason why commissions should be withheld from.him.” In revising tbe account, commissions will be allowed, at a rate to be fixed by tbe court, as tbe law directs. Tbe contention of plaintiff, based upon Revisal, sec. 2773, *641 as to commissions of tbe clerk, cannot be sustained. That section does not apply to tbe facts as tbey appear in this record. No question was raised as to whether this action should have been brought by the clerk’s successor under Bevisal, sec. 906, 907, 908, and, therefore, we have not considered it, and do not express or mean to intimate any opinion in regard to it. The report and judgment will be modified in accordance with this opinion, and the case will proceed further in the court below as indicated by us. Error.