Harris v. Calvert

The opinion of the court was delivered by Giltceson, P. J. : Two questions are presented for our consideration in this case : First. Had the probate court jurisdiction to cite the defendant below to make settlement of the accounts of his testator as guardian ? Second. Is the action barred by the statute of limitations? The first we must answer in the negative, and the second in the affirmative. The constitutional and statutory provisions in reference to the jurisdiction and power of probate courts and the statutes of Kansas governing guardians and wards are unlike those of most of the other states. Hence, we have received very little assistance from the briefs of counsel, except upon general propositions. There is no provision in the statutes of this state requiring guardians to make final settlements. — 754 — The only provision found therein is in paragraph 3236, General Statutes of 1889, and this refers only to accounting. We cannot, as suggested by counsel, take anything by implication or analogy by referring .to the act governing executors and administrators;for the status of each is entirely different, and the capacity in which they act totally unlike. The former ’have the interest .of a single person, or class of persons to look after, and are only responsible to them — their trust is of a private, personal nature — while the latter have in charge the interests not only of those who are to receive the estate upon distribution, but also the interests of the creditors of the deceased, and act as the agents of both (even -though their interests conflict), and their trust is of a public character ; a limit can be set upon the time in which they may be required to do all acts pertaining to their office, and the statutes provide for a final settlement, viz., by notice to the world, and this is eminently proper, for the public, so to speak (that is, parties other than the distributees, who might be termed privies), are interested therein. But none of these conditions or reasons exist as to a guardian. As we have said, he deals only with his ward or wards; to them alone he is accountable. None but they are interested in his accounts, and if they are satisfactory to them no one can complain, not even the probate court, -and their settlement or accounting can be made without the intervention of it. (Tate v. Stevenson, 55 Mich. 320.) While it is true the statute provides for and makes it the duty of guardians to account annually, and oftener if the probate court requires, it clearly has reference to accounts to be rendered during the lifetime of the guardian and the minority of. the wards ; for it would not for a moment — 755 — be claimed that the guardian.could continue in office after the ward became of age, and include in his account, year after year, transactions had between him and his ward after the latter became of age ; for when that event happens the ward is sui juris, and any liability that would attach to either of them would arise out of the contractual relations, and would not be enforceable in the probate court, but in an action at law. We can readily see, from reasons stated, why there is no provision made for a final settlement by a guardian, or, when the settlement becomes final, why public notice is not required. It is unnecessary. Another reason exists in this.state: The probate court has not exclusive jurisdiction over these matters, and the ward is not remediless. But suppose the guardian would, in making a settlement, mark it “Final” and publish a notice : Would it have any more weight or sanctity merely from the fact that notice was given, and the paper marked “Final” ? We think not. And, should it receive the approval of the probate court, the guardian receive his discharge, the probate court be shorn of all its jurisdiction and control over both guardian and ward, this would not make it final, if there had been any fraud practiced.. The district court would still have jurisdiction to examine into it. But if the theory advanced by the defendant in error is correct, it would be valid and binding without regard to how obtained, and the statute of limitations would at once begin to run in favor of the guardian without regard to the condition of' the ward. In many states,, and particularly those from which decisions have been cited by defendant in. error, the statute provides, or the condition of .the bond is such, that guardians are required to make final settlements “ when the ward arrives at age,” — 756 — and under such condition some (but not all) of these courts of last resort have held, “until the guardian does make this settlement the probate court has power to compel him so to do,” on the theory that this is a condition precedent to his discharge ; 1 ‘ and the trust continues until this requirement is complied with.” We think this construction is correct under such statutes. We think that if the guardian should made a settlement with and to the entire satisfaction of the ward, while the court might not be empowered to change the settlement, yet it would undoubtedly have the power to compel the guardian to comply with the law, or fulfil the condition of his bond. It is also noticeable that in all states in which the rule contended for by the defendant in error obtains, the trust of guardianship is not a personal one, but goes to the executor. This is not so in this state. (Gen. Stat. 1889, ¶ 7168; Collier v. Blake, 14 Kan. 250.) And in those states where the rule obtains that probate courts- have authority to cite the personal representatives of a guardian to make a final settlement, it is limited to cases where the guardian dies during his term of office. (9 Am. & Eng. Encyc. of Law, 148, and cases there cited.) And we have failed to find any authority that holds that such power exists in the probate court when the office terminated before the guardian’s death; and in those states where the statute provides that he shall make a final settlement, to obtain it, when the office has terminated prior to his death, recourse has been had to the chancery courts. The final account of a guardian is properly addressed to- the court that has jurisdiction of the estate of the ward, when presented by the guardian ; but when the guardian dies before making a settlement, and long — 757 — after Ms ward’s majority, his executors have no authority to present his account to a court of probate, nor has such court jurisdiction over the matter. The settlement of the account can only be had in a court of equity by a proceeding against the executors and other necessary parties. (In re Allgier, 65 Cal. 228.) We concur with this view, yet under the statutes of California (§1754, Code Civ. Proc.) the guardian is required, and it is one of the conditions of his bond, “when his ward becomes of age, to exhibit to the probate court a final settlement.” As we have stated, when the ward becomes of age the ward is sui juris, and any legal liability which arises between him and his former guardian after that does not arise out of their former relations, but out of the contractual relation established between them, not enforceable within the jurisdiction of the probate court, but the remedy or right is enforceable in an action at law. The presentation of such a settlement is no part of the duties involved in the administration of the estate of the testator. If the property which was under the control of the testator, as guardian, come into the hands of the executor, the guardianship, being a personal trust, did not pass to him on the death of the testator, and the property held by the guardian did not become assets in the hands of the executor or administrator to be administered. He merely holds it for its preservation until'the person whose estate it is, and for whose benefit it is held, can establish a right thereto, obtain a settlement of the trust terminated by the death of the trustee, in the proper forum, where the rights of all parties to the trust may be definitely determined. These settlements must be presented to the probate court by a guardian, but upon his death he is no longer in office, or, if the ward has become of' — 758 — age, the office has terminated, so the remedy is in the courts which retain jurisdiction' after these things have happened, and must be sought in the proper forum. This, then, brings us to the question, “When does the guardian’s term of office expire? ” This may occur in various ways. We will only notice two that are applicable to the case, viz. : (1) The death of the guardian. (2) The ward becoming of age. (9. Am. & Eng. Encyc. of Law, 95; 2 Kent’s Com. 221-227; Stroup v. The State, 70 Ind. 495; Overton v. Beavers, 19 Ark. 625; Tate v. Stevenson, 55 Mich. 320; The People v. Brooks, 22 Ill. App. 594; Glass v. Woolf, Adm’r, 82 Ala. 281; Rose v. Gill, 4 Cal. 250; In re Allgier, 65 Cal. 228; Klemp v. Winter, 23 Kan. 699.) In Taie v. Stevenson, supra, it is held : “ Guardianship . . . ends when tlie ward becomes of age. . . . The guardian then can do no farther act as such, but is dischargéd of his office, and his ward may settle with him if he chooses without the intervention of the probate court; . . . termination of the guardianship is equivalent to the discharge of the guardian.” We .think this is the rule in Kansas, and is very strongly indicated in Klemp v. Winter, supra. For these reasons and upon authority, we think that the probate court has no power to cite, the executor of a guardian to make final or any other, kind of settlement, particularly after the guardianship has terminated. The remedy of the ward is by. an action on the bond, or to compel an accounting, in a court having jurisdiction of such matters. Is his remedy affected by the statutes of limitation? The rule is well established in this state, that, actions upon the bond of a guardian are barred within five years after the — 759 — cause of action shall have accrued, and within two years after the disability (if any exists) is removed. (Code, § 18, subdiv. 5, and § 19 ; Fletcher v. Wormington, 24 Kan. 262; Ryus v. Gruble, 31 id. 767; Scantlin v. Allison, 32 id. 376.) Actions occasioned by default or misconduct of the guardian are by suit upon his bond, and accrue as soon as it occurs. (Bonham v. The People, 102 Ill. 434; State v. Salvin, 95 Mo. 253.) “Actions against sureties on the guardian’s bond are barred in four years from, the guardian’s discharge, and this means four years after he ceases from any cause to be guardian,'and the statute begins to run within two years after the ward arrives at age. That the ward has the right to compel an-accounting will not be disputed, and this action is barred, and the statute begins to run within the same limit as to actions upon bond.” (Jones v. Jones, 91 Ind. 378; Tate v. Stevenson, 55 Mich. 320; 9 Am. & Eng. Encyc. of Law, 148; In re Van Derzee, 80 N. Y. Sup. 532; Glass v. Woolf, Adm’r, 82 Ala. 281; Bone’s Appeal, 27 Pa. St. 492; Adam v. Reviers, 59 Ga. 793.) And in Lenox v. Harrison, 88 Mo. 491, while the court does not apply the statute of limitations, it holds : “ The subject of the favorable presumptions, which are indulged in behalf of' persons acting in an official capacity, especially after a long lapse of time has intervened, has been quite extensively discussed in Long v. J. M. & S. Co., 68 Mo. 422, ... by this court. And equity views with disfavor suits that are brought after the death of the party whose estate is sought to be charged, where the fraud alleged is known before, and suit might have been brought during the lifetime of the party acquainted with the whole business, but without reason or excuse such suit is delayed until after his death. . . . ‘ Under such circumstances the laches must of itself be held fatal, for.it would be — 760 — to assert a doctrine to the last degree hazardous to say that a complainant -with full knowledge of all the facts on which he relies can lie quietly by until death comes to his assistance and puts the seal of perpetual silence on the lips of his adversary.' ” And this very properly applies to the case at bar. With full knowledge of all the facts, years have elapsed in which the defendant in error has remained silent, never claiming what he now seeks to obtain ; not even intimating to his guardian (who, from the testimony, has been more than a father to him) that he intended making a charge against him for services; without reason or excuse for his inactivity and silence (except his cupidity and avarice) asks a court of justice to aid him in taking from those who from his infancy have been as sisters to him the small pittance they have remaining after sharing even this with him. There is nothing in the demand that commends itself to the equity side of a court. But it is contended that the guardian is a trustee of an express trust, and the statute of limitations does not run against such trustee. We cannot concur with the counsel in this. ‘ 'An express trust assumes an intention of the parties to create that relation or position, and a direct act of the parties by which it is created in accordance with such intention, outside of the mere operation of the law.” In an express trust the parties intend such a relation between themselves, carry out their intention by suitable words, and the law confirms and accomplishes the object they had in view. An express trust primarily assumes three parties — the one who by proper language creates or declares the trust; the second, who is the recipient of the authority thus conferred ; and the third, for whose benefit the authority — 761 — is received, and held. Trusts, in their strict and technical sense, are only known to equity, and, falling as they do in such a sense within the peculiar and exclusive jurisdiction of a court of equity, the doctrine has been long established, that so long as they subsist they cannot be reached, as between trustee and cestui que trust, by statute of limitations. But to exempt a trust from the bar of the statute it must be : (1) A direct trust; (2) it must be of the kind that belongs exclusively to the jurisdiction of a court of equity; and (3) the question must arise between the trustee and cestui que trust. (Angelí, Dim. 166.) And we think the rule is, and has been from the earliest decisions, that trusts intended by courts of equity not to be reached or affected by the statute of limitations are those technically and continuing trusts which are not cognizable at law, but fall within the proper, peculiar and exclusive jurisdiction of this court. And this rule was laid down by Chancellor Kent in Kane v. Bloodgood, 7 Johns. Ch. 109, and has been ever since followed, and in commenting on this principle, the chancellor says : ‘£ I cannot assent to the proposition that all cases of direct and express trust and arising between trustee and cestui que trust are to be withdrawn from the operation of the statute of limitations, notwithstanding a clear and certain remedy exists at law. The word trust is often used in a very broad and comprehensive sense. Every deposit is a direct trust. Every person who receives money to be paid to another, or to be applied to a particular purpose to which he does not apply it, is a trustee, and may be sued, either at law for money had and received, or in equity as a trustee for a breach of trust. The reciprocal rights and duties founded upon the various species of bailment and growing out of those relations, as between ‘hirer and letter to hire, borrower and lender, depos — 762 — itary and person depositing, a commissioner, and an employer, a receiver and giver of a pledge, are all cases of express and direct trust’ ; and these contracts, as Sir William Jones observes (Jones on Bailments, 2), are ‘ among the principal springs and wheels of civil society.’ Are all such cases to be taken out of the statute of limitations under the notion of a trust, when one of the parties solicits his remedy in this court ?’ ’ The chancellor then proceeds to examine clearly, but fairly, all the authorities from the earliest that he could find (Harrison v. Lucas, 1 Ch. Rep. 67, 15 Car. 1) down to the case then before him, and shows that the distinction laid down by him could be traced through the whole of them, but that it was not so distinctly and clearly laid down until the opinion of Lord Macclesfield, in Lockey v. Lockey, (Finch’s Prec. in Ch. 518,) in which he says that “To remove a trust from operation of the statute, it must be such a trust, technically, as is created by the mutual confidence of the parties, such as equity alone can take cognizance of, and,afford redress. If it is a trust that the law courts can give relief, the statute will run, although the party may have sought his remedy by a suit in chancery. In such cases, the fact of the suit being brought in a court of chancery will not defeat the statute. It can be avoided only by a technical trust, of which the courts of law could afford no relief. When it is laid down that, so long as a trust is continuing and subsisting, the statute does not commence to run between the cestui que tmst or his assigns, and the trustee, the doctrine applies to such cases only as are strictly and technically trusts, created and sustained by the principles of equitable jurisprudence, exclusive of, and in contradistinction to trusts of common-law cognizance ; and even in such cases the statute would commence to run from the time the trustee disavowed the trust, or did any act conclusively showing that he did not hold — 763 — as trustee. If the legal title is in one, in trust for another, the trust could not be enforced but by a resort to equitable jurisprudence. This would be a case where the trust would be a continued equitable trust. The statute would not run until he had clearly avowed that he did not hold as a trustee, but in adverse right to the trust claim. If one recovers into his possession the moneys or chattels of another it would create a trust; but suppose he goes further and write to the other that he had received his money : here would be a declaration of a direct trust, but not such a trust as ■would be unaffected by the statute of limitations, because suit could be brought in a court governed by the rules of common law. So every bailee is, in some sense, a trustee, but it does not follow that every kind of trust forms an exception to the operation of the statute of limitations. If so, half of the business transactions of men would be removed from its influence. It is important, therefore, in all cases of trust, in inquiring whether the statute can be pleaded, to bear this distinction in mind. If there is a remedy at law — that is, on the principles of common law in contradistinction to equity jurisprudence — the fact of there being such a remedy brings the trust within the statute.” (Wingate v. Wingate, 11 Tex. 430.) The judgment in this case will be reversed, and the cause remanded with instructions to render judgment herein for the defendant below, John P. Harris. All the Judges concurring.