Hendrick v. . Gidney

MacRae, J.: The admissions of the defendants entitle the plaintiff to the judgment rendered bty his Honor, there being no issues for the jury. It is true that administrators having the legal title to the assets of their intestate’s estate may sell or pledge them, or may discount notes of the estate, if the exigencies of the estate make it advisable for them so to do, and that parties dealing with them will be protected, provided the transaction be fair and honest. But “it is settled law that when a person gets from an administrator, or other person acting in a fiduciary capacity, the trust fund or any part of it as payment of the trustee’s own debt, that person cannot hold the fund from the cestui que trust any more than the original trustee could.” Gray v. Armistead, 6 Ired. Eq., 74; Wilson v. Roster, 7 Ired. Eq., 231. As between the administrator Wray, who was also a creditor and a distributee of the estate of his intestate, as appears by the answer, which we take to be entirely true, and the defendants, no question might have arisen if the administrator Wray had settled the estate, paid its debts, and distributed its assets according to law. But this administrator has been removed and the plaintiff is now the administrator de bonis non; the duty is devolved upon him of collecting the assets and disposing of the same according to law. He.finds that the former administrator has pledged to defendants, as collateral security for the payment of his own indebtedness, a note belonging to the estate and bearing notice of its character upon its face. The fact that the former administrator, at the time he made this misappropriation of the assets, was a creditor and dis-tributee of the estate cannot affect the law which requires *547 of the administrator da bonis non to administer upon all of the personal property not already administered. It is not claimed that there are no other parties interested in the distribution of assets or payment of debts than the former administrator. It is admitted that this note, representing land sold to pay the debts of the intestate, has been pledged and is now held by the defendants with full notice of its character at the time it was received as collateral for the payment of the individual debts of the former administrator. The bare statement of the facts carries with it the conclusion that the note belongs to the plaintiff. Judgment Affirmed.