Gavin v. Carling

Alvey J., delivered the opinion of the Court. That Mrs. McNulty, as administratrix of her former husband, John Gavin, deceased, had no right or power to appropriate the personal estate of the decedent to her own use, at the appraised value thereof, and thus make the property her own, to indemnify herself for money advanced to pay the debts and expenses of the estate, is entirely clear, upon what has been decided by this Court upon more than one occasion. Hall vs. Griffith, 2 H. & J., 483; Haslett’s Adm’r vs. Glenn, 7 H. & J., 17. Nor had the Orphans’ Court the power to authorize such appropriation. Hence the account settled in the Orphans’ Court by the administratrix, on the 16th of July, 1869, was clearly erroneous, at least in so far as it allowed her to retain the leasehold property on Lexington street, — 536 — Baltimore, in satisfaction of her advances to the estate of $339.57, according to that account, and of her distributive share, as there allowed, of $90, aggregating $430. The appraised value of the leasehold property was $400. The account being thus erroneous upon its face, and subject to impeachment by those interested in the proper settlement of the estate, it was perfectly competent to the Orphans’ Court, upon application, to re-open the account, and to direct a re-statement thereof, in order to correct the errors disclosed; as was done by the order of that Court of the 28th of June, 1877. Scott vs. Fox, 14 Md., 388; In the Matter of Stratton’s Estate, 46 Md., 551. And as there is nothing appearing in the record to raise a doubt as to the correctness of the account as re-stated, and approved by the order of the 17th of August, 1878, we must take that account, as thus re-stated and approved, as being in all respects proper and correct. The account speaks and shows the condition of the estate as of the 16th of July, 1869. And instead of being a final account, closing the administration of the estate, according to the profession and showing of the original account as stated and passed, it now appears that the estate is still open, and that the leasehold property remains unadminstered. Mrs. McNulty died in the latter part of the year 1876, and before any further or final account was settled; and consequently, an administration de bonis non became necessary; and such letters have been granted, and the unadministered property has devolved upon the administrator de bonis non, who is the defendant in this cause. Under sec. 12 of Art. 93 of the Code, the surviving husband of the deceased administratrix is required to state an account; hut that account is only required to show “the amount of money and property received, and of payments and disbursements, made by such administratrix, or that may have been received or paid by him, (the husband) and not before accounted for with the Court.” He is not authorized to — 537 — take charge of and administer property left unadministered by the deceased administratrix. There can be no question therefore but that the leasehold property in question, and which forms a part of the personal estate of John Gavin, deceased, has legally and rightfully devolved on the defendant, as administrator de bonis non; and we think it equally free from doubt that he has a right, and that it is his duty, to proceed to sell such property, and account for the proceeds. There would, however, appear to be some considerable t hardship in the case; the property having been improved at considerable cost, and the parties having acted on the settlement of the estate as made by the sanction of the Orphans’ Court, allowing the leasehold property to be taken by the widow of the deceased at a valuation, by making an assignment of it by way of mortgage to a third party for valuable consideration. But the parties must, in strictness, be chargeable with knowledge of the defects in the proceedings in the Orphans’ Court, and be held to have dealt with respect to the subject-matter in subordination to the rights of those interested in the legal and proper settlement of the estate. We are of opinion, however, that there is an equity in respect to the proceeds of sale, to which the complainant is entitled. He, of course, is entitled, by virtue of his mortgage, to whatever interest or right McNulty and his wife, the mortgagors, had in the premises at the date of the mortgage. The proof shows that at the death of Gavin, the leasehold lot was but poorly improved. It had a small house upon it, consisting of two small rooms, one over the other, and a small shed back-building, of one room, used for a kitchen. As we have already stated, this lot with the improvements upon it, was only valued at $400. And this was nearly all the property he left, and it was the only home of his family, consisting of his wife and four minor children — two boys and two girls. After the — 538 — widow married McNulty, in 1864, there was not room in the house for the decent and comfortable accommodation of the family. The enlargement of the building became a necessity if the family continued to occupy the property as a home. Under the press of this necessity, McNulty, after his marriage, tore down the old and erected in its stead a new substantial house, adequate to the wants and requirements of the family, at a cost of over $2000. This was the improvement on the lot at the time it was mortgaged to the complainant in December, 18T5. The property, thus improved, was sold to the complainant, under a decree of foreclosure of his mortgage, for $2300. McNulty and his wife were not in wrongful possession of the property; they were not trespassers or intruders; nor were they without interest in the premises. The wife had her one-third interest in the property, and she was the natural guardian of her children, entitled to the other two-thirds; and they were then living with and being supported by their mother and her husband. ■ In 2 Story Eq. Juris., sec. 1234, it is laid down as a settled doctrine of equity, that there is a lien resulting to a joint owner of any real estate, or other joint property, “from repairs and improvements made upon such property for the joint benefit, and for disbursements touching-the same. This lien sometimes arises from a contract, express or implied, between the parties, and sometimes it is created by Courts of equity, upon mere principles of general justice, especially where any relief is sought by the party, who ought to pay his proportion of the money expended in such repairs and improvements; for, in such cases, the maxim well applies: Nemo debet locupletari ex álterius incommodo.” And so, in sec. 1231, of the same author, it is said, “where a tenant for life, under a will, has gone on to finish improvements permanently beneficial to an estate, which were begun by the testator, Courts of equity have deemed the expenditure a charge, — 539 — for which the tenant is entitled to a lien.” And in the case to which the author refers, of Hibbert vs. Cooke, 1 Sim. & Stu., 552, the Vice-Chancellor directed an inquiry as to “ whether it was for the benefit of all parties interested in the testator’s estate that the mansion-house should have been finished; and if so, then to inquire what had been properly expended by the widow in that respect,” with a view of making the expenditure a charge. The principle is a just and reasonable one, dependent upon no mere technicality, and it would seem to be entirely applicable to this case. That the improvements here made were both beneficial and necessary to all concerned, can admit of no doubt. Indeed the family could not have been accommodated without them; and the property as left by the decedent Gavin could not have been disposed of for enough to provide the widow and infant children with a more commodious home. As determined by the Orphans’ Court in the opinion delivered by them, and upon which the order of the 28th of June, ISII, was passed, the husband of the deceased administratrix of Gavin, in rendering the further account required of him by the statute, from the 16th of July, 1869 to the time of the death of his wife, would only he chargeable with the rents of the property as it toas left by the decedent. Upon the same principle, and for the same reason, the accountability for the property itself should he as it was left by the decedent, and not for the additions and necessary improvements placed thereon by the money and labor of the widow or her second husband, under the circumstances disclosed in the case. In dealing with the net proceeds of sale, therefore, there should he an equitable apportionment made, between the value of the property as it was left by the decedent, and the permanent beneficial improvements placed thereon since his death, rating their value and the enhancement of the property as at the time of the sale. The improvements thus to he allowed for — 540 — must, of course, bear their just proportion of all taxes, insurance, and other charges and expenses, assessed or paid upon the basis of the improved condition of the property; and after all proper deductions, made upon fair and just principles of accounting, from the value of the improvements thus ascertained, and the one-third interest to which Mrs. McNulty was entitled as the widow of the deceased John Gavin, (to which those amounts are-subject,) the balance, whatever that may be, will be the extent of the interest of the mortgagee in the premises; and that amount he should receive from the proceeds of sale. In the sale made under the decree of foreclosure, of course, no other or greater interest was disposed of than was conveyed or assigned by the mortgage. (Decided 16th March, 1881.) This settlement may all be effected in the Orphans’ Court, or the present bill may be retained to enforce the rights of the parties as herein determined. The decree appealed from will be reversed, the injunction dissolved, and the cause remanded. Decree reversed, and cause remanded.