Kadish v. Lyon

Mr. Justice Scott delivered the opinion of the court: Plaintiffs in error urge that by the indenture of September 1, 1890, which provided that Kadish, his heirs or assigns, might purchase from the lessors, their heirs or assigns, the property at any time within ten years for the sum of $40,000, and that this agreement should be considered a covenant running with the land, binding upon the heirs and assigns of said lessors, Kadish became, in equity, the holder of the fee in the premises, and that the same, upon his death, descended to his heirs. We think this ignores the distinction between a contract for the purchase of real estate and a contract by which the owner gives to another the option to purchase lands. Kadish and those who succeeded him would acquire no interest in the land by virtue of this contract for an option until he or they had exercised their right to purchase. (Bostwick v. Hess, 80 Ill. 138; 18 Am. & Eng. Ency. of Law,—2d ed.—p. 632.) The provision that the agreement to sell should be a covenant running with the land does not alter the situation. That was probably inserted by the parties to malee certain the fact that the land, as well as the owners thereof, should be bound for the performance of the contract in the event that Kadish, or those succeeding to his rights, elected to purchase. It is next urged that the administrators wrongfully used the trust fund in their hands in the construction of the buildings which had been begun by their intestate, and that for this reason plaintiffs in error have the right to follow the trust fund into the real estate, and be decreed to be the owners of the real estate, to an extent equal in value to the amount of the trust fund so improperly diverted. It appears from the bill that the administrators used the funds of the estate to carry out the contract of the intestate, made with Mendell and his associates. Knowledge of that fact possessed by the owners of the real estate would not charge them with any equity in favor of the plaintiffs in error. The latter, however, by their brief and argument urge that this fund was wrongfully used in the construction of the building; that the owners of the real estate had knowledge of that fact, and that for this reason the relief prayed by the bill should be awarded. The complaint is, that the administrators did not obtain from the probate court any order or direction to carry out the contract of their intestate, as contemplated by section 126 of chapter 3, Hurd’s Revised Statutes of 1905, which reads: “All contracts made by the decedent may be performed by the executor or administrator when so directed by the county court.” We think that no case is by the bill made which authorizes the intervention of a court of equity. If an administrator elects to perform a contract entered into by his intestate for the benefit of the estate without obtaining the order or direction contemplated by section 126, supra, where the contract is not of a strictly personal nature, he may do so, taking upon himself the risk of being required to make good any loss that may ensue. If he obtains the order or direction contemplated by the statute after having fully disclosed to the court all the facts and circumstances proper for the court’s consideration, and carefully and exactly carries out the order or direction, he will, no doubt, be thereby relieved from personal liability. If he acts without such order or direction but in good faith, for the purpose of complying with the contract of the deceased, his acts, so far as the living parties to the contract are concerned, are binding upon the estate. (Smith v. Wilmington Coal Mining Co. 83 Ill. 498; Jessup v. Jessup, 102 id. 480.) If the administrator and the living parties to the contract, under the guise of performing the contract, should fraudulently collude together for the purpose of making such disposition of the funds of the estate as that such funds would be lost to the estate and pass into the hands of and become the property of such living parties, a question not arising upon this record would be presented. The decree of the superior court will be affirmed. Decree affirmed.