King v. Follett

Hutchinson, C. J., delivered the opinion of the Court. — The decision, of which the appellant complains, affected the general balance ofhis account,and his appeal brings up the whole account ; and the decree of this Court fixes the balance, and it must be certified to the probate Court, that he may be governed by it in all future proceedings. But the parties are disposed to litigate nothing except the $800 decreed against the appellant. And here it should be distinctly noted, that the claim of the appellee is not connected with the three hundred dollars a year to be paid until a ceitain event, named in the will of Gideon King, should happen. For any claim of that kind the appellee must apply in another way ; either commence an action for such three hundred dollars, or claim in chancery a forfeiture of the legacy, on the ground that nonpayment of the three hundred dollars would work a forfeiture; for the executor, as such, only accounts before the court of probate for the estate as it was at the decease of the testator, adding such rents, interests and profits as accrued during the settlement of the estate. [388] The foundation of this claim is, that the earnings of this steam boat stock, which might have composed a dividend at the decease of the testator, had the company seen fit then to have struck a dividend, should be considered as personal estate of the deceased,, belonging, after the debts,&c., are paid, to the residuary legatees •. or, in other words, the appellee contends, that the appellant can have nothing in bis legacy of the steam boat stoek, but what he would have been entitled to receive, if a dividend had been struck and paid immediately before the decease of the testator. This forms the question to be decided. The clause rn the will, giving to Follett 160 shares in said steam boat stock, adds, being all his interest in the same stock, be the same more or less. Now it is contended by the appellant, that this expression of interest, &c., has reference to,or may comprise, any property connected with this stock, aside from these shares ; and includes the very money now in dispute. But we think this expression was inserted to avoid any possible mistake in the number of shares. He supposed his shares to be 160 ; but what number he had he bequeathed to said Follett. This is the true construction of that part of the will. In deciding this question, we are led to consider the nature of this property, and ascertain what a purchaser, or donee, is entitled to by his conveyance. A conveyance of stock, such as steam boat stock, canal stock, bridge stock, and the like, conveys the right of receiving the dividends of the income of such stock, and of conveying the same right to others ; and this necessarily includes a liability to pay assessments for out-goes in repairs, agencies, &tc.; for whenever a dividend is struck, the expenditures are first duducted from the incomes, and the net balance only is divided. And every person, purchasing such stock, purchases upon the risk of outstanding debts against the company; for these have a lien upon the stock, in whose hands soever the title may be, and may secure themselves by requiring covenants against such preexisting liens'upon the stock. Suppose one or more of these boats, belonging to this company, had been consumed by fire, just before the decease of the testator, or exactly at his decease, or shortly afterwards; in either case,it would have diminished the value of the stock, and its effect must have been felt in the next dividend; and the loss, with regard to the 160 shares, must have fallen upon Follett, the owner at the time of such dividend : because the dividend must have been proportionably less, by deducting this loss ; and this, whether the loss was before, at, or after [389] the decease of the testator. Furthermore, the loss, in either case, . might have been so great, that, instead of a dividend, there must have been a heavy assessment upon each share to meet the expense of reinstating the boats for business. In such case Follett must have paid this assessment to prevent a sale of his shares to pay the same ; for such assessment would have been, like any other debts, a lien upon these shares. Should the company refuse to make a dividend, and should Follett apply to a court of chancery for a decree compelling a dividend, all he could expect would be a decree that a dividend should be made by some day certain, and be made upon the principles we have just delineated. Adams, Bailey & Marsh, for the appellant. Richardson & Allen, for the appellee. We may present another view. Suppose the testator had conveyed these 160 shares to Follett, by an absolute deed, the same day that his will took effect. Could he or his executor claim a dividend of the prior earnings of the Boats ? We think not. His conveyance discharged him from any-further corporate risks for losses, and left Follett the only person who could receive and discharge the dividends made afterwards; and left him the only person, who could enforce a dividend, should the company refuse to make one, when his interests required it. This is the very case before us. If Gideon King’s conveyance would have given to Follett this sum of ‡800, now in dispute, his bequest, taking eflect at the same period, must have a similar efiect. The result is, that the decree of the court of probate must be reversed, so far as relates to this sum of ,$800, but affirmed as to all the remainder of the account; and this decree must be certified to the court of probate from whose decree the appeal was taken.