Allender v. Riston

Stephen-, J. delivered the opinion of the Court. In this case the plaintiff, as administrator de bonis non of William Wyse, instituted an action of replevin against the defendant, to recover certain property, out of his possession, which he claimed in his representative character, as part of the assets of said Wyse. In 1814, William Wyse died intestate as to his personal estate; letters of administration were granted to his widow, who returned an inventory, and settled an account with the Orphans Court of Baltimore county, in which she craved an allowance for sundry payments and disbursements, amounting to the sum of $ 1292 91. This account was settled on the 29th of June, 1816. The deed of mortgage under which the defendant claims [97] title to the property, was dated on the 16th of May, 1822, executed by the widow and administratrix, and three of the representatives. Nearly six years had elapsed between the account settled with the Orphans Court, and the execution of the deed of mortgage. The question principally argued in this case, was, as to the power of an executor or administrator, to dispose of the assets of his testator or intestate, in satisfaction of his own debts. The mortgage was given as collateral security, for the payment of a note of hand drawn and endorsed by the mortgagors, payable to the defendant. According to the authorities, it seems that at law, an executor or administrator may transfer the assets of the deceased, in satisfaction of his own debts. Toller on Executors, 256, 257, says, he has power to sell, or as it has been held, to mortgage terms of years, or assign mortgaged terms, and to dispose of any of the effects; although as it seems specifically given by the will, and even in satisfaction of his own private debt. Nor when he has aliened the assets, can a creditor follow them at law; for the demand of a creditor is only a personal demand against the executor, in respect of the assets come to his hands, but no lien on the assets. Equity will, indeed, follow assets on voluntary alienations, by collusion with the executor; but if the alienation or pledge be for a valuable consideration, unless fraud be proved, neither law nor equity will defeat it: for a purchaser from an executor has no means of knowing the debts of the testator; and if a Court of Equity, on the subsequent appearance of debts, would control such purchaser, all dealings with executors, would be dangerous; and even in equity, Chancellor Kent, in referring to the case of Nugent vs. Gifford, 1 Atkins, 463, in 7 Johns. Chan. Rep. < 17, says an assignment of a mortgage term (and it was a mortgage to trustees, in trust for the testator) was made by the executor to the plaintiff, in satisfaction of a debt due from the executor to the plaintiff. Yet Lord Hardwicke held the assignment to be valid, and that the creditors of the testator [98] were not entitled to follow the property. A purchaser from an executor has no power of knowing the debts of the testator; and if he did know it was testamentary assets, it would not affect the validity of the assignment, as it was an alienation for a valuable consideration; and no fraud or collusion with the executor to misapply the assets, appeared. The doctrine in that case has been repeatedly advanced; and it appears to be an established principie, both at law, and in equity, that a bare act of sale of the assets by the executor, is a sufficient indemnity to the purchaser, if there be no collusion. In the case of Whale vs. Sir Ch. Booth, Lord Mansfield observed, that if at the time of the alienation, the purchaser knew they were assets, this was no evidence of fraud; for all the testator’s debts may have been already satisfied: or, if he knew that the debts were not already satisfied, must he look to the application of the money ? no one would buy on those terms. There is one exception, indeed, where a contrivance appears betwefe-n a purchaser and an executor, to make a devastavit. In f Johns. Chan. Rep. 157, Chancellor Kent says, a subsequent decisions, have, in some degree, restrained the extent of the doctrine laid down by Lord Hardwicke, and Lord Mansfield. In Bonney vs. Ridgard, 1 Cox, 144, Lord Kenyon, the Master of the Rolls, admitted, that in general the purchaser from the executors of the testator’s assets was not bound to see to the application of the money; but, that if upon the face of the assignment of the property, it appeared to have been made in satisfaction of a private debt of the executor, the sale was fraudulent against the persons -interested, under the will, and equity would relieve. It would be a case of implied fraud.” So again in Scott vs. Tyler, Dickens, 712, Lord Thurlow held, that where an executrix pledged bonds, specifically, as a security for her own debt, contracted after the testator’s death, the pawnee must deliver up the bond, for the benefit of the specific legatee. He admitted, that in general the purchaser of the assets had no concern with the application of the price, and that the rule applied equally [99] to mortgages, bonds and leases. But if one concerted with the executor to obtain the effects at a nominal price, or at a fraudulent under value, or in extinguishing the private debt of the executor, or in any other manner contrary to the duty of the office of executor, the purchaser or pawnee will be liable. In Hill vs. Simpson, 7 Vesey, jr. 152, Sir William Grant made a similar decree. He said, the assets known to be such, ought not to be applied in any case, for the discharge of the executor’s debt, unless the creditor taking the assets can be first satisfied of his right so to apply them. Lord Eldon has also declared, “ that there could not be a stonger case of a devastavit than an executor aliening the property of the testator, to pay his own debts, the alienee knowing at the time that debts of the testator were due. In the case now before this Court, it nowhere appears that there were any debts remaining due and unpaid at the time of the mortgage; or if they were, that the defendant knew of them, and to use the language of Mr. Justice Ashhurst, to be found in 4 Term. Rep. 645: “if the creditors will lie by and not assert their rights, it is reasonable for a third person to suppose that all the debts are satisfied,” But in this case, it does not appear that the administratrix acted in her representative character at the time she executed the deed of mortgage: she does not, in terms, assume that character, and has associated herself in making the disposition of the property, with three of the children and representatives of her intestate: from this fact, connected with the strong circumstances existing in the case to induce a presumption that the debts were all satisfied, it is fair to infer that she had made distribution of the remaining assets, and acted in her character of distributee. And upon this view of the case, it follows that the appellant, the administrator de bonis non, is not entitled to recover. As to the question raised in the cause, relative to the admissibility of the plaintiff’s own inventory to support his case, made after the institution of the action, we think the [100] same was not competent evidence, because he might become personally liable for the costs of suit. JUDGMENT AFFIRMED.