Nettles v. McCown

Decision Date13 September 1873
Citation5 S.C. 43
PartiesNETTLES v. MCCOWN.
CourtSouth Carolina Supreme Court

An administrator deposited in bank, in March, 1860, $442.20 in bank bills, which he held for a distributee, and allowed them to remain on deposit until 1863, when he took them into his own possession, and having made use of some, retained $200 thereof until his death, in 1868, when they were sold by his administratrix at 27 cents on the dollar: Held That his estate was liable for the $442.20, with interest from March, 1860, and the fact that the fund was claimed by an assignee of the distributee, and that no demand was made for the money until 1867, was not sufficient, with the other circumstances, to excuse the estate from the payment of interest.

BEFORE RUTLAND, J., AT DARLINGTON, OCTOBER TERM, 1871.

The case is stated in the following brief prepared for this Court:

This was a bill of revivor, filed April 15th, 1869, by Samuel J Nettles, trustee, against Harriet B. McCown, administratrix (with the will annexed) of James McCown, setting forth the filing of an original bill against her said testator, in which it was stated that, on the 2d January, 1855, a post-nuptial settlement of certain negroes was made by John F. DeLorme to Isaac D. Wilson, trustee, for the benefit of Adeline O. DeLorme (wife of John F.) and her children; that on the 28th February, 1860, the said John F. and Adeline O executed a deed of assignment, conveying to the said Isaac D. Wilson all the right and interest of Adeline O. in certain negro property, then recently recovered, under a proceeding of John D. Pritchett et al. vs. Robert Harllee et al. , and other property named, in trust; that said Wilson should appropriate sufficient of the funds arising from said property to replace the value of a salve, contained in the first deed, sold by them without the knowledge of Wilson, to hold the same, and the residue, subject to like trusts created in the first deed; that James McCown was administrator of Robert Nettles, deceased, grandfather of Adeline O. DeLorme, who was a distributee of the property recovered by said suit, and from whom the interest of Adeline O. was derived; that, as administrator, said James McCown had received large sums of money, in which said Adeline O. was interested; that, on the 4th day of August, 1866, Samuel J. Nettles, plaintiff, was duly substituted trustee under both of said deeds, instead of Isaac D. Wilson (with Wilson's consent); that James McCown had paid over none of the moneys received by him to Mrs. DeLorme's trustee, Isaac D. Wilson, or to plaintiff, though plaintiff had often called on him and required him so to do, and prayed an account and decree for their payment.

The original bill was filed 12th December, 1867, and taken pro confesso against James McCown, 28th January, 1868. No answer was filed to the original bill or to the bill of revivor, and the statements of the bill were not controverted.

It did not appear, in the pleading or evidence, that Wilson had ever appropriated sufficient of the funds arising from the interest of Mrs. DeLorme in the negro property of her grandfather, referred to in the bill, to replace the value of the slave sold, as stated.

A Referee was appointed to state the accounts of James McCown, and report the amount of Mrs. DeLorme's interest in his hands.

At the reference it appeared that Mrs. DeLorme's interest in the amount received by James McCown, as administrator of Robert Nettles, in March, 1860, was $442.20. A paper was submitted in evidence, by defendant, of which the following is a copy, viz.:

" Mr. James McCown, administrator of estate Robert Nettles:

Take notice, that Col. I. D. Wilson has an assignment of the interest of John DeLorme and Adeline O. DeLorme in the funds now in your hands.

6th March, 1860.

" J. A. DARGAN,

" Attorney for I. D. Wilson."

It did not appear, at the hearing, that this notice had ever been waived or withdrawn.

It appeared that when Mr. McCown received the money, as administrator, he deposited it in the agency of Georgetown Bank, at Darlington Court House, and paid out the same to the other distributees as they called for their shares; paid all, except Mrs. DeLorme, in March, April and May, 1860; that her share remained on deposit till 1863, when, there being some talk, by Mrs. DeLorme's father, of arranging the papers so that McCown could pay over said share, and of going to his house for the purpose, Mr. McCown drew it out, but did not pay it when her father went down, " as no one was present who was authorized to receipt for the money," and never returned it to the bank. He used some of the money, which was in bills of South Carolina banks, convertible into specie when deposited; and about $200 in bank bills, which the witness supposed to be of the sum deposited, remained on hand when Mr. McCown died, the last of the year 1868. Joseph J. McCown, son and agent of the administratrix, sold the bills remaining at twenty-seven cents on the dollar in 1870.

It did not appear in the pleading or evidence that Mr. McCown ever gave notice to Mrs. DeLorme or her trustee of the deposit, or of his readiness to pay her share; nor did it appear that Mrs. DeLorme claimed adversely to Wilson, her trustee.

Demand was made on James McCown by Samuel J. Nettles, trustee, for Mrs. DeLorme's money in the spring of 1867. The parties all lived in Darlington County up to the death of Mr. McCown.

The Referee held, as matter of fact, that the deposit by Mr. McCown was special, and that there did not appear to have been any steps taken by which he could pay Mrs. DeLorme's portion until 1863; that $200 in the bills first deposited by McCown remained on hand at his death, which were sold at twenty-seven cents on the dollar.

As matter of law, that, the money being held on deposit by McCown, he was not liable for interest on it until formal demand was made, which was not until the filing of the bill, 12th December, 1867; that the loss of the money deposited was the loss of the trustee, or cestui que trust , not of McCown; and that the amount due by McCown was $242.20 plus $54, the amount for which the bills on hand sold, making $296.20, with interest from 12th December, 1867, to date of report, October 13th, 1871, amounting to $375.24.

To this report exceptions were filed by plaintiff, bringing the questions before the Court as to the liability of Mr. McCown for the whole fund belonging to Mrs. DeLorme in his hands, and for interest thereon.

After argument His Honor decreed as follows:

" This case was heard on exceptions to the report of M. A. Huggins, Esq., the Referee appointed by the Court. James McCown was the administrator of Robert Nettles, one of whose distributees, in the events that have occurred, is Adeline O., wife of John F. DeLorme. About the first of March, 1860, McCown, as administrator, received the fund, to which, under proceedings in equity, his intestate was entitled. He made a deposit of the entire fund at the time he received it with the agent of the Bank of Georgetown, at Darlington Court House. Out of that fund, in March and April of that year, he paid the full shares of all those entitled to participate, except the share of Mrs. DeLorme.

In January, 1855, John F. DeLorme executed a deed to Isaac D. Wilson, as trustee, conveying to him certain negro property. Thereafter DeLorme and wife sold one of the negroes covered by the said deed, and to replace the value thereof, in February, 1860, they executed another deed to Wilson, conveying their interest in certain negroes, the possession of which was then sought by bill in equity. A recovery was had in this last case; the negroes were sold, and McCown came into possession of the fund already alluded to."

A notice was served on McCown in these words, to wit:

[Here follows a copy of the notice signed by J. A. Dargan, attorney for I. D. Wilson.]

" The share of Mrs. DeLorme in those funds was $442.20.

On the 4th day of August, 1866, the plaintiff was substituted, by order of Court, trustee, instead of I. D. Wilson, and in December, 1867, filed his bill against McCown, calling on him to account for the share of Mrs. DeLorme, to wit, the sum of $442.20, with interest.

Before a hearing, McCown died intestate, and the plaintiff revived his bill against the defendant, as administratrix of McCown. So far as I can see and have heard, this fund, in McCown's hands, was not covered by the first deed above mentioned. How, then, can the substituted trustee be entitled to claim it?

The Referee reports that McCown received the whole fund in bills of specie paying banks; that these bills remained with the bank agent till the year 1863, (counsel agreed till July 1st, 1863,) when he withdrew them, in order to pay or turn them over on some arrangement which Mrs. DeLorme's step-father was to make, but he failed to give Mr. McCown a proper voucher. About that time McCown used $242.20 of the money; that $200 of them were found intact at his death. That, after his death, Joseph J. McCown, agent of the administratrix of James McCown, sold these $200 in bills at 27 cents on the dollar.

The Referee held, as law, that McCown was not liable for interest until formal demand was made; that this was made December 12th, 1867, when the bill was filed against him; that the loss of the fund must be the loss of Mrs. DeLorme or her trustee; that the amount due by McCown was $242.20 and $54, the sums used by him, and the product of $200 in bills, sold by Joseph J. McCown, with interest from December 12th, 1867.

I can find no sufficient error as to facts, on the part of the Referee, as to warrant my interposition, and, therefore, overrule the exceptions, so far as the facts are involved.

As to the law, I think the...

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