Kirby v. State ex rel. Pascault

Brent, J., delivered the opinion of the Court. Among the assets left by Mrs. Elizabeth Kennard, was a mortgage due from John Outram and wife. Under the will of Mrs. Kennard, her son Philemon T. Kennard was appointed sole executor, and having qualified as such, he instituted proceedings in the Circuit Court for Talbot County for the foreclosure of this mortgage. A decree — 390 — was passed for the sale of the mortgaged premises and Kennard was appointed trustee. He, however, died before any sale could be effected, and Joseph V. B. Wright, on the 5th of October, 1870, was appointed trustee in his place. Wright sold the property on the fifteenth of October, 1873, and reported the sale, which was finally ratified by the Court on the ninth'of October, 1874. He received upon the mortgage altogether the sum of thirteen thousand dollars, the mortgagor having paid him forty-five hundred dollars, and the sale realizing eight thousand five hundred. The last payment was made on the twenty-first of July, 1874, which includes a payment of five hundred dollars paid by the mortgagor. The case -was regularly referred to the auditor, who seems to have stated two accounts, distributing the fund after an allowance of costs and commissions. But the Circuit Court rejected both accounts, holding that letters de bonis non must be taken out upon the estate of Mrs. Kennard, as the distribution of the fund could be legally made, since her executor was dead, only to a duly appointed administrator. After this decision of the Circuit Court, Joseph V. B. Wright obtained from the Orphans’ Court of Talbot County the appointment of administrator, and gave as such administrator the bond, which is the cause of action in this present suit. He then filed a petition in the case in the Circuit Court, stating that he had taken out letters de bonis non with the will annexed upon the estate of Mrs. Elizabeth Kennard, and praying that the papers in the case may be referred to the auditor “ with directions to prepare an audit in conformity with the opinion of the Court filed in this case.” The Court thereafter, “ for the reasons set forth in the opinion heretofore filed ” by them, affirmed the distribution of the balance of the fund, amounting to $12,333.65, in the hands of Wright, trustee, to Wright as adminis — 391 — frator, and directed the trustee to pay it accordingly. This order was passed on the 2nd of June, 1876, nine days after the granting of the letters of administration. Wright prepared an administration account in November following, in which he charges himself with this sum of money, and left the account with the Register, that the Orphans’ Court might determine the amount of his commissions. This was done by the Court, and when the account was afterwards shown to him by the Register, he said it was all correct. Dying shortly afterwards, on the 1st of January, 1877, he never made affidavit to it. The account, however, was sworn to by his executrix, and is now on file in the office of the Register of Wills. So far as this record discloses, this trust fund is the only part of Mrs. Kennard’s estate which had not been fully administered. It is the only item with which the administrator de bonis non charges himself in the account left by him with tire Register, and the only item upon which commissions were claimed and allowed by the Orphans’ Court. We have failed to see any reason why the account left by Wright with the Register is not admissible evidence in this case. If the money which he held as trustee was in his possession, or had not been wasted at the time of his appointment, it is conceded that it would pass by operation of law into his hands as administrator, and that his charging himself with it in that capacity would be then admissible in proof. But the proof of a devastavit while trustee is upon the defendants. We do not understand that the plaintiff, to avail himself of the benefit of a presumption of transfer by operation of law, is required to do more than to show that a person in one character is debtor, and the same person in another character is creditor. The exhibition of this account only shows that the administrator, Wright, in charging himself with this fund has complied with and acted upon this presumption. — 392 — "We are not prepared to say that this -presumption is made conclusive from the fact, that a person who had property in his possession as trustee had, at his will, charged himself with it in a new capacity of administrator. If the property has been actually wasted and squandered, neither the presumption of law nor the admission of the party will always operate a transfer, when in reality nothing existed to transfer. But this defence is to be proved by the party setting it up, and can in nowise render inadmissible such proof as goes to establish the claim of the plaintiff. "We do not think that sections 224 and 225 of Article-93, 1 Code, apply to the present case. Those sections are in derogation of the common law, and they must be restricted to cases of indebtedness strictly falling within them. They both refer to “claims which the deceased had against ” the executor or administrator, and look to certain proceedings to be had, or to the return of the debt in the list of debts, as necessary to make a debt due by such executor or administrator stand as if it were so much money in his hands. The debt now claimed against the-administration bond of Wright, does not seem to fall within these sections. It certainly is not a “ claim which the deceased had against him.” But we are of opinion, that under the facts in this case the fund, which he held as trustee, must be considered as having been transferred by operation of law to him as. administrator. The general doctrine is well settled, that where a man holds money in several capacities the law will attach to him liability in that capacity in which of right the money ought to be held. This doctrine is recognized in many of the decisions in this State. See State vs. Jordan, 3 H. & McH., 180; Flickinger vs. Hull, 5 G., 74; Seegar vs. State, 6 H. & J, 12; Watkins, Adm’r vs. Shaw, 2 G. & J., 220; Hanson and Wife vs. Worthington and others, 12 Md., 418; Sparks and others vs. Weedon and — 393 — others, 21 Md., 156; Byrd & Crisfield, Ex’rs vs. State, use of Stewart, 44 Md., 502. The proceedings in the Circuit Court in regard to the fund held by Wright as trustee, show that the sole purpose of his becoming administrator was the transfer of the fund to him in that capacity. The Court had filed a written opinion deciding that the fund could only be transferred to an administrator of Elizabeth Kennard, and to obtain such a transfer Wright took out letters of administration, and gave the present bond signed as sureties by these appellants, for the single purpose of enabling him as administrator to possess and hold the fund. As before said there were no other assets of the estate unadministered, and upon this fund alone was the administration designed and intended to operate. The securities have nothing reasonably to complain of in the present proceedings taken against them. Their bond was for the faithful administration and payment over to the persons entitled of this very fund and no other. If their principal has failed to do so, and they are now held responsible for his default, it is but the result of their undertaking as understood and entered into by them when they executed his bond as sureties. The proof as offered in this case does not establish any devastavit by Wright as trustee. We know of no law which implies a devastavit, if a trustee does not attach a mark to his trust money and keep it in some separate place apart from all other moneys. The fact that the money had been deposited by him in bank to his individual credit and afterwards withdrawn, or the proof offered to show that he was insolvent, do not by any means rebut the presumption that he had retained and would have paid over to another if he had been appointed administrator, the amount due by him as trustee. His bank account shows that he was possessed of considerable sums of money, after the order of the Court directing the transfer to him as — 394 — administrator, and the proof offered is far short of establishing a waste of the fund while trustee, and his total inability to pay it while administrator. As said in Gray vs. Brown, 1 Richardson, 363, where a similar question arose: “If, by discharge under the bankrupt law, or the insolvent debtor’s Act, or other legal means, the liability of the trustee had been extinguished, of course no duty to pay would have survived, and the liability could not have devolved upon the surety to the guardianship bond. But without a discharge, proof of the trustee’s inability to pay his debts, could not prevent the presumption of retainer; for this debt may have been met, although others could not have been.” It follows from what we have said that the second prayer of the plaintiff was properly granted by the Court. It contains-all the facts in the case which it was necessary for the jury to find to enable the plaintiff to recover.' As the first and third prayers of the defendants are inconsistent with the plaintiff’s second prayer, which was granted, they were properly refused. The plaintiff’s first prayer and the defendants’ third prayer are in regard to the $1234.41, received by Col. Hamilton on a debt due Wright as administrator of Philemon T. Kennard, and which had been placed in Col. Hamilton’s hands as collateral security for the benefit of the sureties on Wright’s bond as trustee. Although we think the ruling of the Court upon these prayers was error, yet the case will not on that account be reversed and sent back, because it cannot in any way affect the general result. In the rejection of the defendants’ fifth prayer there is no error. Any presumption of law, that the share of this trust fund, to which Philemon T. Kennard was entitled, had passed to Wright as his administrator, is rebutted by the proof in the case. Wright was appointed administrator of Mrs. Elizabeth Kennard, on the 22nd of May, — 395 — 1876. In November, 1876, he prepared his first and final account, in which he charged himself with the whole fund, but died on the 1st of January, 1877, before it was finally passed by the Orphans’ Court; so that in fact no transfer had actually been made, nor did any presumption of transfer arise, as Wright died about seven months after he was appointed administrator, and before his final or any account had been finally acted upon by the Orphans’ Court. (Decided 26th March, 1879.) As we find no error which will justify us in reversing the judgment-of the Court below, it will be affirmed. Judgment affirmed.