Wood v. Williams

Hough, Judge, delivered the opinion of the court. It appears from an agreed statement of-facts filed in this cánse that on the 15th day of February, 1859, Michael S. Williams, surviving partner of the firm of Hale & Williams, having been appointed by the County Court of Lawrence County, administrator of the partnership estate of said firm, gave bond as such administrator, with Alexander A. Moore and James H. Jones as his sureties. On the 11th day of March, 1859, Williams and wife executed and delivered to said Moore and Jones a mortgage of certain lands therein described, to secure them from loss or damage as such sureties, which was acknowledged and recorded on the 23d day of March, 1859. On the 7th day of May, 1861, Williams, at the request of Moore and Jones, the latter desiring to leave the State and wishing to be released from all further liability on said bond, gave a new bond which was received and approved by the County Court, with Alexander A. Moore and Henry Childress, as securities. On the 22d day of April, 1868, Williams made final settlement of the partnership estate, and the sum of $1,177.76 was — 65 — then found to be in his hands belonging to the estate of said Hale, which sum lie was ordered by the court to pay to the administrator of the estate of s&id Hale. Williams having failed to pay said sum as directed by the court to the administrator of Hale’s estate, said administrator brought suit in the Lawrence Circuit Court, on the second bond against said Williams, and the plaintiff herein as administrator of Moore, then deceased, and the administrator of Childress also deceased, and recovered judgment on the 11th day of November, 1868, for the sum of $1,124.04 and costs, one-half of which judgment, amounting to the sum of $579.32, the plaintiff herein, as administrator of Moore, paid to the administrator of Hale on the 3d day of April, 1869, the administratrix of Childress paying the-other half. Williams was then insolvent. Before the execution of the second bond, Williams had used, of the partnership assets in his hands as administrator, the sum of $3,000 in the purchase of a farm for himself, and in mercantile operations on his own private account. The property described in the mortgage was sold in 1863, under a judgment rendered against Williams in 1860, and was purchased by Mrs. Kellogg, who with her,husband were made parties defendant;-and the present suit is brought to recover the said sum of $579.32 paid on the judgment on the second bond, and for foreclosure of the mortgage executed by Williams to secure Moore-and Jones. Jones refusing to join as plaintiff was made a party defendant. The cause was tried by the court without the aid of a jury, and judgment was rendered for the defendants. Plaintiff brings the case here by writ of eruor. Numerous instructions ■were given -and refused, but the facts being agreed upon it will not be necessary to notice them. The defendants in error contend, in support of the judgment below, that the approval by the County Court of the second bond released the sureties on the first bond from all liability for any default of Williams, happening after the date of sueh approval, and the payment by the plaintiff of a judg — 66 — ment on the second bond for a breach thereof, gives him no right to the indemnity furnished by "Williams to plaintiff’s intestate as a surety on the first bond ; and that if there was any conversion of the estate which constituted a breach of the first bond, the administrator of Hale should have sued upon the first bond, and that the failure of the plaintiff here, to make such defense to the suit against him upon the second bond, debars him from all right to relief in this action. It is clear that if the sureties on the first bond were not discharged by the giving of the second bond, the plaintiff is entitled to recover. The second bond does not seem to have been given in conformity to any statute, though it is evident that it was the effort and intention of the parties to make a bond which would relieve Jones, who intended to leave the State, from any further liability as surety for Williams. The record does not disclose that any notice was given or that any of the statutory causes for this"proceeding existed. Notice, however, would not be held to be essential, as the parties might voluntarily appear; but the existence of some one of the grounds pro-. vided by statute for taking a new bond and discharging the sureties on the old one, would- seem to be indispensable. The 37th section of Art. I, of the Administration Law, (Wagn. Stat., vol. 1, p. 76), provides that, £1 if any person bound as security in the executor’s or administrator’s bond, file in the proper court an affidavit, stating that the affiant has sufficient cause to believe and does believe his co-security has died, or has or is likely to become insolvent, or has removed from the State, or that the principal in such bond has or is likely to become insolvent or is wasting the estate, and shall have given the principal on such bond at least ten day’s notice of such complaint, the-court shall examine into the complaint.” It is only for some one of the causes specified in this section that the County Court may require a new bond, the approval of which will operate to discharge the sureties on the old one from liability for the future default of the adminis — 67 — trator; and tin's proceeding is wisely limited to eases where complaint is made and cause shown to the court. A strict adherence to the statute may prevent solvent securities from being too easily succeeded by insolvent ones and will contribute to the preservation of estates. The second bond not having been given in pursuance of the statute and being simply a voluntary and additional bond, had the effect only of adding a new security for the faithful performance by Williams of his duties as administrator, and did not otherwise affect the first bond. As the first bond remained in full force during the whole period of Williams’ administration it is manifest that any violation of his duty was a breach of this bond, and for the failure of Williams to pay over in obedience to the order of the County Court, the money due the estate of Hale, Hale’s administrator had a right of action on either or both of the bonds given by Williams, though he would of course have been limited to a single satisfaction. The default of Williams upon which the judgment against the plaintiff was founded, being as much a breach of the first as it was of the second bond, and the surety on the first bond having been damaged by such default is entitled to the indemnity afforded by the mortgage. The judgment of the Circuit Court will be reversed and the cause remanded. All the judges concur.