Givens v. Flannery

JUDGE HOBSON delivered the opinion of the court. The will of "Dr. George W. Givens contains the following clause: “I also direct my executors to invest and retain-under their control and management the sum of one thous- and dollars, and to pay over from time to time to said Sarah Givens, for and during her natural life, the annual interests or profits therefrom, and at her death to pay the same to the daughters of said Samuel and Sarah Givens, [453] or survivor or survivors.” The executors named in the will failed to qualify, and on August 2, 1881, William E. McAfee qualified as administrator with the will annpxed, vvith appellant as his surety in his official bond. Sarah Givens died March 1, 1894. The administrator paid her the interest annually during her life, but, having failed to pay to her daughters the principal after her death, they instituted this action against him and appellant as his surety on his bond. Appellant demurred to the petition. Her demurrer was overruled. She then filed answer, to which the plaintiffs demurred, and, the court having sustained that demurrer, she declined to plead further, and judgment was entered against her. The only question in the case is whether the surety in the executor’s bond is responsible to the remaindermen for this fund. It is well settled in this State that the surety in an executor’s bond is only liable for the duties which the law imposes upon the executor, and that he is not liable where the executor discharges the duties of a trustee, although the will, in imposing these duties, may not designate him as a trustee. Thus in the case of Allen v. Kennedy, 10 Ky. Law Rep., 336, [8 S. W., 8S2], where an executor was directed by the will to lend out certain legacies until the legatees became of age, and then pay them the money, the sureties in his bond were held not responsible for his default. The court said: “The loaning out of this money and holding it from ten to twenty years was no part of the executor’s duty as such. He became trustee for these appellants, and as such can be held responsible.” This case followed Lasley v. Lasley, 1 Duv. 117; Neely v. Merritt, 9 Bush, 346; Warfield v. Brand’s Adm’r, 13 Bush, 98, and we deem the rule too well settled now to be departed from. It is insisted that this rule should not be applied here, because it is not aver [454] red that the executor settled his accounts, and that this fund was set apart and left in his hands by his settlement. It is averred that he held this money as trustee, and paid out the interest yearly to Mrs. Givens as such trustee; and, if he has made no settlement, it seems to us this should be averred by plaintiffs, if they wish to raise this question. After so many years, he should be presumed to have held the money as trustee, and not as executor; and in this event his surety is not liable for the fund for the reason that, as soon as he received it, it was his duty to hold it as trustee, and lend it out, and pay over the interest to Mrs. Givens. A conversion of it by him at any time after he received it, so far as appears, was a breach of his duties as trustee under this clause of the will, and not of his duties as executor. To protect themselves against possibility of this loss, appellees had the right to require him to give bond for the discharge of these duties. This they did not do; and if the money was lost while held under this trust, during the life of Mrs. Givens, the appellant, who undertook only for the faithful discharge of his legal duties as administrator with the will annexed, is not responsible for its loss by reason of a trust extending through so many years, and which might have extended much longer. The judgment is therefore reversed, and the cause remanded, with directions to overrule the demurrer to appellant’s answer, and for further proceedings consistent with this opinion.