George v. Johnson

Nesmith, J. Now, it appears to us, that,- under the action of the heirs to the estate of said Lewis E. Eaton, in agreeing to the appointment of arbitrators, and in submitting the matters then in dispute to their decision, and procuring an award upon the merits of the same, and especially by accepting the report of said arbitrators, and ratifying the same by the execution of releases or discharges in conformity with its provisions, the plaintiff, as the representative of said heirs, is now placed in such position, that he cannot disclaim the acts of those he represents, unless some manifest and material mistake, or some fraud or corruption has been discovered. The equitable rule laid down in Hibbard [458] v. Kent, 15 N. H. 519, applies here. If all the parties, beneficially interested in the estate, adjusted and settled their interests in it, and if there be no mistake or fraud, the settlement is binding, and none of them by procuring administration can be permitted to defeat such settlement. Under the wise provisions of the preceding decision, if the heirs to an estate, being of age, and all mentally capable, shall actually undertake to adjust their several claims, and ascertain their respective shares and liabilities without the expense of a formal administration, each receiving his share, all executing legal and proper discharges or indemnities, it would be very mischievous, if any one might at his mere pleasure set aside and defeat what has been done for the mutual advantage of all. Where an attempt is made to break up a settlement made under such circumstances, very strong evidence must be produced by him who attempts to disturb it, that positive injustice has been inflicted upon him. In cases of fraud, when an administrator has been appointed, the proper course for the party defrauded would be to deliver up whatever property he may have received to the administrator, in order that there may be a legal or more equitable division of the whole fund. In the case before us, the defendant had authority by law, as surviving partner of the firm of Johnson & Eaton, to adjust all the affairs of the late firm. It was competent for Johnson to waive his rights, and, by the yery course adopted, to call in to his aid the services of those capable and willing to examine into the accounts, business and property of the firm, as well as its liabilities, and, in this way, to divide the capital and income of the said firm among those entitled to take a dividend. And, although all the heirs of Lewis E. Eaton may not have signed the original submission in this case, yet, after a hearing upon the matters submitted has once been had, and the heir who has omitted to sign the original submission voluntarily accepts the amount awarded to him, he is bound by this act and is estopped from averring against it, unless, as before suggested, upon the discovery of manifest mistake or fraud. 2 Story’s Equity,secs. 1452 and 53; Tracy v. Herrick, 25 N. H. 381. It is enough to say, that, upon the full examination of all the evidence .in this case, we do not find fraud made out; nor do we find misconduct • or undue partiality in the tribunal selected by the parties to try their matters in controversy. Two of the arbitrators were neighbors and relatives of the parties. Their character, capacity and partialities were known as well by the one side as the other before they were selected to settle the matters in dispute. The plaintiff, in his testimony, has undertaken to suggest some errors or omissions, or that the arbitrators had not before them certain claims now presented. These are not large in amount, nor is the evidence at all conclusive that they were not examined or weighed by the arbitrators. The difficulty now is, that, after so long a time, and from the imperfect records left by the arbitrators, and, we may add, in consequence of the death of some who might, if living, give light and information, it is now impossible to determine with strict accuracy just what the arbitrators embraced in their award. The award of the arbitrators has been in the possession of Mr. Preble for a long [459] time, or it has been accessible to him, and he has also had opportunity to consult the old company books and their other records. The defendant, for a long time, has had no claim made upon him by Preble, or any one interested, and it appears to us, it is now quite too late to disturb the slumbers of a case which has been suffered to rest so long. We think this is a case where the statute of limitations may properly interpose its bar. The claim now made can be justly regarded as stale. Courts of equity sometimes act by analogy to the courts of law, and apply the statute of limitations to the facts of the case; and sometimes act upon their own inherent power of discouraging for the peace of society antiquated demands, and refuse to interfere where there has been gross negligence in prosecuting rights,or long acquiescence not accounted for. We are aware that courts of equity are not necessarily bound to apply the statute of limitations, but generally they will decline to decree an account, where the transactions have become obscure and entangled by time. Rayner v. Pearsall, 3 Johns. Ch. 578; Rayor v. Bogart, 2 Johnson’s Cases, 432. In Smith v. Clay, Ambler’s Reports, 645, Lord Camden remarks: "A court of equity, which is never active in relief against conscience or public convenience, has always refused its aid to stale demands, where the party has slept upon his right for a great length of time. Nothing can call forth this court into activity but conscience, good faith, and reasonable diligence. Where these principles are wanting, the court is passive and does nothing.” In 3 Hare’s Reports, 347, Chancellor Wigram says : "In this court there is direct and high authority for the proposition that a court of equity will not after six year’s acquiescence, unexplained by circumstances, or countervailed by acknowledgment, decree or open an account between a surviving partner and the estate of a deceased partner.” Generally a court of equity will not open an account by their decree after six years of delay, wholly unaccounted for. 2 Story’s Equity, in note to section 1520; Barber v. Barber, 18 Vesey, 286; Auld v. Goodrich, 4 Russ, 430; 15 Viner Abridg. Title, Limitations; Martin v. Heathcote, 2 Eden Rep. 169; Atwater v. Fowler, 1 Edwards’ N. Y. Rep. 417; Platt v. Bouchard, 4 Id. 30. By recent statute in the State of New York, it is ordained that actions for relief on the ground of fraud, of solely equitable cognizance, should be brought within six years after the discovery of the fraud — Code of Procedure, section 91; actions for other relief not otherwise provided for, ten years. Same Code, section 97. In this State, we have no statute applicable here except the statute of limitations, and, under the facts and evidence presented before us, we see no reason why the plaintiff should be permitted to open the old company accounts, which have reposed so quietly for the period of more than twelve years. Therefore our decree is, That the hill be dismissed.