Baylies v. Payson

Chapman, J. The principal questions submitted to the court in this case are, whether any agreement has been concluded between the parties; and if so, what are its terms ? It appears that the defendant gave notice of his intention to prove the will of Ruth Payson in the probate court on Monday the 23d of April 1860, and that Mr. Minot was retained as his counsel to transact the business. On Friday, April 20, Mr. Hoffman, one — 486 — of the plaintiffs, called at Mr. Minot’s office, and notified him that he intended to oppose the probate of the will on account of the heirs of Mrs. Baylies, one of whom was his wife. On Monday the defendant called and gave Mr. Minot notice that his nephew, E. Lincoln Baylies, whom he had seen in New York, had made objections to the will, and had made a proposition for a compromise, on the basis that he and his sisters (Mrs. Hoffman and Mrs. Livingston) should receive one quarter of the estate; that he had agreed to give an answer on his return to Boston, and had done so or was about to do so by writing a letter to Mr. Baylies accepting the proposal. The defendant was then informed of the interview of Mr. Minot with Mr. Hoffman, and that Mr. Parker had been retained to oppose the will, and was advised that they should be informed of the proposed settlement; and with his approbation Mr. Minot went to Mr. Parker’s office, where he found Hoffman also, and informed them that the defendant had accepted the proposal of Baylies, and that the matter would be settled in that way. The reply was, in substance, an assent to such a settlement on the part of parties then in Boston, and an agreement to write or telegraph to New York for its acceptance by parties there. The will was not proved on that day; and on the following day Mr. Hoffman informed' Mr. Minot that he had received a telegram from New York, informing him that the compromise was assented to by the parties there. It was then proposed and assented to by the counsel on both sides that the agreement should be put in writing; and a contract was drawn up, with which they were mutually satisfied, expressing what they regarded as the terms of the agreement. It was to be signed and sealed by the parties. Mr. Minot sent the paper to the defendant that day, with a note informing him that it was correct, and that it would operate to save the necessity of calling more than one witness to prove the will, and stating also the effect of the agreement. On the same day the defendant returned the paper to Mr. Minot, declining to sign it, stating his reasons for doing so, and informing him that he had written to Mr. Baylies, and that no other document was necessary. It is impossible, therefore,. — 487 — to regard this paper as the agreement of the defendant, signed by him. But on the same day the defendant wrote a letter to Mr. Bay-lies, stating the terms of the compromise particularly. This letter was signed by him, and appears by the facts to have been an acceptance of the offer made by Mr. Baylies in New York, with the addition of some details ; and on the 26th of April Mr. Baylies replied to it, acknowledging its receipt, and by implication assenting to its terms. There is a material difference between the terms of the contract drawn up by counsel and the terms of the defendant’s letter, which seems not to have attracted the notice of counsel at the time. The contract provides for a conveyance by the defendant to the heirs of Baylies of an undivided fourth part of the estate, real and personal, simultaneously with the probate of the will. If this agreement had been signed, and its terms complied with on the part of the plaintiffs, a bill might have been maintained for its specific performance immediately after the probate. But the letter to Baylies agrees to pay the proceeds or value of one fourth part of the estate in cash. Its language is, “ to pay over to you and them, when in cash, one fourth of the net proceeds of the same.” The net proceeds cannot be ascertained till after the final settlement of the estate by the defendant as executor. The expenses of the last sickness and the funeral and of administering the estate must be first deducted; and if the testator left debts, they must be paid. A reasonable time must also elapse to ascertain whether any debts exist. Strictly speaking, the defendant has nothing to do in the fulfilment of such a contract until after he shall have settled the estate as executor, or at least till he shall have had a reasonable time to settle it. This bill cannot therefore be maintained on the ground that the plaintiffs are entitled to the specific performance of a contract which has been broken by the defendant. This was the ground on which the case was put at the first argument. But at a second argument, after the court had decided that the letter of the defendant to Baylies constituted the contract, another position was taken, namely, that the bill might — 488 — be maintained for the purpose of declaring and enforcing a trust This position requires the discussion of several new questions. Upon consideration, the court are of opinion that a trust is created by the contract. Lord Thurlow, in Legard v. Hodges, 1 Ves. Jr. 478, states the maxim to be universal, “that wherever persons agree concerning any particular subject, that, in a court of equity, as against the party himself, or any claiming under him voluntarily, or with notice, raises a trust.” Here the property bequeathed to the defendant is the subject of the contract, and he is bound to deal with it in good faith for the benefit of the plaintiffs, to the extent of one half its value. In the sale and in accounting for the proceeds, he acts as trustee for them. And in the mean time, so far as is necessary, he should preserve it for them. The doctrine, as stated in 2 Spence on Bq. 860, is, that there must be an agreement to pay out of a particular fund, amounting to an appropriation of a part of the fund for the purpose. This describes the present case; and the defendant is to be regarded as the trustee of the plaintiffs to manage and sell the property and pay over to them their share of the proceeds. But an objection is here interposed, that the plaintiffs have not performed the contract on their part, and for that reason are not entitled to require its performance on the part of the defendant. On this point the court have never entertained any serious doubt. Within a reasonable time after the matter was understood, the plaintiffs filed in the probate court an assent to the probate of the will. No opposition to it was ever actually made in court by them. The case was continued by consent, and then the will was proved. If, however, this constituted the whole case, we should have thought the bill ought to be dismissed. The plaintiffs contend that it could be maintained for the purpose of declaring the trust; but we do not think the mere declaration of a trust, where it consists merely of deciding that a certain contract has been made, and that it creates a trust, is a sufficient ground for maintaining a suit. Nor is it sufficient, even if the defendant — 489 — denies that' he made the contract, if the denial is not fraudulent. And we are of opinion that in the present case the matter had become involved in so much doubt that the defendant might in good faith deny that there was a binding contract in existence. There was a dispute as to the terms of the contract, and as' to its performance by the plaintiffs on their part. The defendant gave early notice that he denied its existence, on the ground that the plaintiffs had not accepted his offer. And though we find that it had been completed and was binding, and was performed by the plaintiffs, and constituted a trust, we cannot regard the defendant as guilty of any fraud in setting up these objections. Nor had he, when the bill was filed, in any respect broken his contract. He had proceeded to prove the will; and, for aught that appeared or wac alleged, he was proceeding to administer the estate. But the bill contains an allegation that he is about to depart out of the limits of the United States to some foreign country, and this allegation is denied. There is no prayer for any specific relief on account of this fact, such as is usual in such cases, but merely the general prayer for relief. And all that seems to be proper is, that the trust shall be declared in conformity with the opinion herein stated, and the bill retained for further direction ; for when a trustee is about to leave the country, a court of equity will give such protection to the interests of the cestui que trust as the exigency of the case may require, and will retain a bill for future action. The following decree was entered : This case came on to be heard and was argued by counsel, and the court having considered the same do find and declare that a concluded agreement was made between the plaintiffs on the one part and the defendant on the other part, as is stated in the said bill, the terms whereof appear in and by the letter of the defendant of the date of the 24th day of April A. D. 1860, which is set out in the said bill, and that the plaintiffs are entitled to the specific performance thereof, and that by force of the said agreement the defendant became charged with the trust — 490 — of executing the said agreement; and that the defendant being about to leave the United States, without an intention to return, and having actually departed into foreign parts soon after the filing of the bill, and the plaintiffs being remediless by reason thereof save by the said bill, the court doth retain the same for the purpose of giving the relief to which the plaintiffs are justly entitled. And it is ordered that the plaintiffs have leave to apply to the court for such further directions as may be needful to compel the specific performance of the said trust. The parties thereupon filed a written agreement, stating that the damages to which the plaintiffs were entitled under the foregoing decree were agreed to be $22,174.19, including costs; and a further decree was made, reciting the above agreement, and ordering and decreeing that the said sum is the amount which the plaintiffs are entitled to recover, and that the defendant pay the same.