Collinson v. Owens

Dorsey, J., delivered the opinion of the court. The important question presented for our determination in this case, is, whether an administrator, on an estate inadequate to the payment of the debts of the deceased, after having paid all such debts, is, in a court of equity, entitled to a reimbursement of the amount by him overpaid, out of [9] the deceased’s real estate upon the production of his accounts passed with the Orphans Court, and the vouchers upon which they are founded, and establishing by legal testimony independently of the action of the Orphans Court upon the subject, an amount of such vouchers or debts, equal to the sum overpaid the personal estate? Or in other words, can an administrator, thus circumstanced, seek reimbursement from the real assets, upon any other principle than that of being subrogated to the rights of all the. creditors by him paid off? The attempt now made, if sustained, is in effect to give to the administrator the power to administer the real as well as personal assets. It strips the heir of his inherent hereditary rights, and vests them in the administrator. Such a doctrine is at war with the spirit of all the decisions of this court upon analagous subjects. We have determined that the admission of a debt by an executor or administrator, even a judgment against him, is no evidence against the heir, to take a claim out of the statute of limitations — wherefore then, shall the unauthorized acts of the administrator be permitted to have that effect? His duty is prescribed by our testamentary system; he is to distribute the personal effects of the deceased rateably amongst his creditors. If disregarding his liabilities, he has satisfied debts which he was under no obligation to pay; the consequences of his acts should be visited on himself, not on the appellees: their legal right should not be impaired thereby. All that in equity and conscience he could ask, is, that he should be substituted to the rights of the creditors overpaid. With this he is not satisfied; but calls on a court of equity, by an evasion of the mandates of the testamentary system, an indirect kind of transmutation of payments, to invest him with rights not possessed by those with whose attributes he is clothed, to grant to him a substitution against the realty not merely to the amount of his over payment to any individual creditor, but to the whole amount paid such creditor; although more than two-thirds of such payments were made [10] with the personal assets. The object and effect of which would be to deny to the heir the privilege of defending his inheritance against illegal and unjust claims against it; and to vest that authority in the executor or administrator. Such a proceeding cannot be tolerated. |*The heir has the-same uncontrolled discretion in resisting the payment of claims advanced against the realty, that the executor or administrator has in regard to the personalty; and by no act, device or contrivance of the administrator or executor, can his power to do so, be abridged. Is Sanction the principle now insisted on, and all claims passed by the Orphans Court and paid by the administrator, though barred by the statute of limitations, or liable to be defeated upon their merits, by proof within the knowledge and reach of the heir, provided there be claims of an equal amount against which the heir can offer no defence, may be fixed by the executor or administrator upon the real estate, without leaving to the heir any possibility of defending himself against them. For example: if the realty be worth § 10,000, the personalty $> 10,000, and the debts defeasible as aforesaid amount to i$ 10,000, and the debts indefeasible to the like sum, by the management of the executor or administrator in applying the entire personal assets in payment of the defeasible debts, the whole of the real estate is consumed by the indefeasible debts, and the heir is left pennyless; whereas, had the personalty been appropriated as the law directs, one half of the realty would have been preserved to the heir. The only correct disposition that could be made of the personal assets, is to apply them to the payment of all the debts of the deceased in due proportions. As respects the balances due such creditors, which have been paid by the administrator, he must establish and proceed to recover them out of the realty, by the same course of proceedings that such creditors, if unpaid, would have been bound to resort to. We cannot regard the decree for the sale and distribution of the real estate of Edward Collinson, relied on in the answer as a bar to the relief sought by the complainant, as furnishing the slightest obstacle to his recovery. Estoppels [11] are not favored, but are odious in the eye of a court of equity. None of the rights or matters in controversy in this cause, were at issue, considered, or decided by the chancellor, in the ease referred to. The only question there adjudicated, otiicr than the sale of Edward Collinson’s real estate, was the distributive proportion, as respected each other, to which his several heirs were respectively entitled. Whether the personal estate was insolvent, or to what amount the real estate was answerable to creditors, were questions not presented by the record, nor examined by the chancellor. The only use that could bo made of the proceedings in that case, against the complainant here, would be, that they were evidence of the injustice and fraudulent fabrication of his claims, as from their amount, he must have known of the insolvency of the personal estate; and would consequently, have proceeded for a sale of the real estate, to pay the debts of the deceased, rather than for its distribution amongst his heirs. But for this purpose they cannot avail the appellees; as from the record in this case it does not satisfactorily appear, that at the time of said proceedings and decree for the sale of the real estate, the insolvency of the personal fund was apparent to the appellant. Claim No. 30 is not relieved from the bar to its recovery, which the plea of limitations presents by the proof offered as to its being a loan from John to Edward Collinson for the purpose of purchasing land, and therefore, as is insisted, a lien thereon. There is nothing in the transaction from which such an equity could arise. John Collinson does not appear to have looked to the land, as a security for his debt, either at the time of the loan or at any subsequent period.. When the money was advanced, the agreement was that Edward should give his note for the amount. The only security demanded, or to have been given, was the personal responsibility of Edward. That such was subsequently the understanding of the brothers, is manifest from the settlement between them in 1833, where this loan was simply made an item in an open account; and where John [12] agrees, that Edward should have the land on which the alleged lien is alleged to be, at so much per acre; to be paid for in a manner distinctly stipulated, yet not an intimation is given of the lien in question. Such an omission cannot be accounted for, had the lien existed in the contemplation of the parties. / Although we cannot grant relief to the complainant to the extent of his pretensions, we cannot sustain the decree of the Chancery Court dismissing his bill. He unquestionably was entitled to some relief. Claim No. 19 relative to the division of the land, being in our opinion sufficiently supported by proof, the balance due thereon, after the moiety of Rezin Estep’s bond, and its distributive proportion of the personal estate are deducted therefrom, stands unaffected by the plea of limitations, and should be paid out of the proceeds of the real estate of Edward Coltinson; and one fifth part thereof must be drawn from the share received or to be received by Thomas Owings. As soon as the necessary audit is made, this court will pass a decree reversing the decree of the Chancery Court, and giving to the appellant that relief to which, from our views expressed in the aforegoing opinion, he appears to be entitled. DECREE REVERSED.