Goodman v. Kopperl

Mr. Justice Waterman delivered the opinion of the Court. This is a bill filed by a creditor of a decedent, charging the making of fraudulent conveyances by the deceased, the insolvency of his estate, that no letters of administration i have been issued thereon, and that in consequence the property left by the deceased is in the hands of persons who are endeavoring to convert the same to their own use, and that such property, by reason of the want of any person authorized to properly care for and administer the same, is likely to be entirely frittered away and lost, so that the creditors of the deceased, to whom such property belongs, will receive nothing as the avails thereof. Under these allegations it is sought, by the aid of a receiver, to take the administration of the entire estate into a court of chancery, not calling upon, and leaving the Probate Court with nothing to do in the premises. While it is true that the jurisdiction of the court of chancery over estates of deceased persons has not been taken away by our statute concerning the administration of estates, it is, nevertheless, the case that, primarily, the administration of estates of deceased persons is committed to the Probate Court, and that a court of chancery can not and will not take jurisdiction and so administer, save in extraordinary and unusual cases, even if in any case it will, in the first instance, before there has been any attempt to administer through the agency of the Probate Court, take upon itself the entire task of administration, carrying it on to the end, so that there shall be nothing left for the Probate Court to do. In High on Eeceivers, Secs. 706 to 724, the subject of the appointment of receivers over executors and administrators, as well as before the appointment of such, for the preservation of an estate, is considered. Many illustrations are given of the rules by which a court of chancery is guided in attempting to administer upon the estate of a deceased person, or in interfering with an administration already going on; but it is nowhere stated that the court will, in any case, ignore the Probate Court and itself proceed to administer. The same is true of what is said in Kerr on Eeceivers, pages 28 to 38; and it is stated that the court of chancery will appoint a proper person to protect a testator’s estate where circumstances require it, until a legal, personal representative is appointed; but a bill to protect and also to administer the estate is irregular. Overington v. Ward, 34 Beavan, 175. In Pomeroy’s Eq. Jur., Yol. 3, Sec. 3, chapter concerning the administration of estates, page 98, it is said in substance, that in a number of the States of the Union, among them Illinois, the general principle regulating the exercise of all jurisdiction concurrent with that of the Probate Court in the administration of estates, prevails; and that when either court has assumed jurisdiction of a particular case, the other tribunal will not ordinarily interfere. In the note found upon page 104, as to the probates in the State of Illinois, it is said, that “the theory is admitted by later as well as earlier cases in this State, that equity retains a general jurisdiction over administrations, concurrent with, but paramount to, that possessed by the Probate Courts, and the only practical question is, when will that jurisdiction be exercised. The earlier decisions allowed its exercise somewhat more freely than is done by the later ones; they seem to have permitted a resort to equity in the first instance instead of to the Probate Court, for the purpose of an accounting and final settlement, without any special ground alleged; and also for the purpose of re-examining and correcting a settlement made by a Probate Court, with which a party was dissatisfied. The more recent cases, while fully admitting the existence of this jurisdiction, have repeatedly declared the rule to be, ‘ Courts of equity will not exercise jurisdiction over the administration of estates, except in extraordinary cases. Some special reason must be shown why the administration should be taken from the Probate Court.’ ” The same work, Yol. 3, Sec. 1332, in treating of the cases in which a receiver may be appointed to take charge of the estate of a decedent, says: “ During the litigation concerning the admission of a will to probate, and during the interval before an executor or administrator is appointed, a court of equity has power to appoint a receiver of the personal property, and of the rents and profits of the real estate, where there is any danger of their loss, misuse, or misappropriation. The necessity of such a receiver has been greatly lessened by modern statutes authorizing the Probate Court to appoint an administrator ad litem, and enlarging his powers.” The same author in Yol. 1, Sec. 77, in speaking of the jurisdiction of equity in the matter of settling the personal estates of deceased persons, says: “ In the American States these matters are all governed by statutes, which determine the nature and regulate the application and distribution of assets by fixed and certain rules, binding alike upon all tribunals. Probate Courts are established for the settlement of decedents ’ estates, and all questions arising in the course of administration are decided by them to the practical exclusion of the equity jurisdiction.” Equitable suits growing out of pending administrations are still frequent, but they are brought for some special and partial relief; for the construction of a will; the determination of a controversy arising with respect to a particular legacy; the adjustment of conflicting claims to a particular fund, and the like. It is true that the statutory rules for the settlement of estates are largely based upon the principles' which had been settled in equity, and that equitable doctrines are constantly enforced by the courts of probate; but it is no less true that this important head of equity jurisdiction has been greatly restricted, or even practically abandoned, in all the States. It is urged that this is a creditor’s bill, and that in the case of a claim against the estate of a deceased person, where a fraudulent disposition of his estate, or some portion thereof, by the debtor in his lifetime, is alleged, it is not necessary, for the maintenance of a creditor’s bill, that the claim shall have been reduced to judgment, or allowed in a Probate Court. In McDowell v. Cochran, 11 Ill., page 31, the court sustained a bill filed against the administratrix of the estate of Adam Cochran, the estate being alleged in the bill to be insolvent, it appearing that the complainant had obtained, judgment, and thereby, as the court said, exhausted his legal remedy; it not being permitted that he should have execution issued against the administratrix. The court said: “ Under our statute, an execution can not issue on a judgment against an administrator, but the judgment is to be paid in due course of administration, as all other claims against the estate.” So in Steere v. Hoagland, 30 Ill. 264, certain judgment creditors of the deceased were allowed to file a creditor’s bill, seeking to set aside a fraudulent transfer of a stock of goods, made by the decedent in his lifetime, without having had an execution issued and returned no property found. The court in that case did say (but the statement was unnecessary to a decision of the case, because the complainants were judgment creditors): “When a fund is only accessible to a court of chancery, and can not be reached at law, and where the debtor is deceased, creditors may resort to chancery in the first instance, without having recovered a judgment at law.” In Garvin, Bell & Co. v. Robert Stewart’s Heirs, 59 Ill. 229, a creditor filed a bill against the heirs of a deceased partner, the complainant having obtained judgment against the surviving partner; the purpose of the bill being to subject real estate which had descended to the heirs of the deceased, to the payment of a partnership debt, the surviving partner being alleged to be insolvent. A demurrer to the bill was sustained by the Circuit Court, which decree was affirmed by the Supreme Court. In that case the Supreme Court said: “ In this case, however, there is no traversable allegation that there are are no assets or personal property, out of which the debt could be made by administration. The creditor’s lien is only a secondary one, depending upon whether there are personal assets. It is not until they are exhausted that the administrator is authorized to apply for leave to sell real estate for the payment of debts. If there are assets, the law has appropriated them to the payment of this and all other debts the testator may have owed, and they should be exhausted by administration before the lien on real estate could be made available. Again, there is no positive and traversable allegation that there are no other creditors of Stewart’s estate. If there are, then plaintiffs in error have no superior claim or lien to theirs. And in case there are other creditors, to entertain this bill would be to transfer the settlement and administration of the estate to a court of equity, while the statute has designated another tribunal and prescribed a different mode for the settlement and distribution of estates, more expeditious and less expensive than in a court of chancery. There are, however, cases, where there are complicated equities, which might authorize a court of equity to entertain jurisdiction, and having done so, it would retain the case and do complete equity to the parties. But in this case the facts are simple, and we can see no reason for taking the case out of the usual course of administration. If letters of administration should be granted, no reason is perceived why the claim of plaintiffs in error should not be allowed against Stewart’s estate, if just and subsisting, or that would prevent the administrator from applying for an order for the sale of this land. Although equitable, the claim is cognizable in the Probate Court.” In the present case it appears from the bill, that there are personal assets of the estate which have not been applied to the payment of debts; the complainant’s bill therefore falls directly within the principle enunciated in St-eere v. Hoagland. In Harris v. Douglas, 64 Ill. 466, the court, upon page 469, says: “A court of equity will not assume jurisdiction except in extraordinary cases where the remedy afforded by the statute is inadequate. It is for the very plain reason that the statute has pointed out a different mode, and the party must pursue the remedy provided by law. By the provisions of the statute of wills, claims against estates are to be classified, and some are to be paid in full, and others fro rata. A claimant can not avoid this statute by resorting to a court of equity. The law is settled, in this State, at least, that a court of equity "will not ordinarily assume jurisdiction until the claimant shall have exhibited his claim and had it allowed in the County Court, and then if any special reasons, that may be deemed sufficient, can be assigned why that court can not afford the requisite relief, equity will assist him, but not otherwise.” Armstrong v. Cooper, 11 Ill. 561; Freeland, Ex’r, v. Dazy et al., 35 Ill. 296; Heustis v. Johnson, 84 Ill. 61; Crain v. Kennedy, 85 Ill. 340; Duval v. Duval, 153 Ill. 49. In Wood v. Johnson, 13 Ill. App. 548, the court reiterated its former announcement that a court of chancery will not exercise jurisdiction over the administration of estates except in extraordinary cases. In Scripps v. King, 103 Ill. 469, the court declares that before a creditor can maintain a bill against an insolvent estate, he must have had his claim properly allowed against the estate, although his bill be to remove a fraudulent conveyance and reach the property so conveyed, to satisfy his demand. The same rule is declared in Winslow v. Leland, 128 Ill. 304. A party filing a creditors bill is entitled to priority over such bills subsequently filed. If the present bill can be maintained, the complainant will be entitled to have the assets of the insolvent estate first applied to the payment of his claim. Subject to certain statutory rights of the family of a deceased person, his personal estate belongs in the first instance to his creditors; certain classes of claims have precedence over others, and his real estate descends to his heirs, their title being subject to be divested for the purpose of satisfying claims of creditors remaining after the exhaustion of the personal estate. The complainant’s interest as a claim upon the estate of the deceased, stands pro rata upon a footing equal only to that of the numerous other creditors alluded to in the bill. Ko reason is shown why this complainant has not heretofore exercised his right as a creditor, and taken out letters of administration upon this estate; nor does there appear to be any obstacle in the way of letters yet being taken out and this estate administered and distributed by the Probate Court in accordance with the statutes of this State. The decree of the Superior Court dismissing the bill for want of equity is affirmed.