Halsey v. Cheney

• Decision Date: 09 July 1895
• Docket Number: 168.
• Citation: 68 F. 763
• Parties: HALSEY et al v. CHENEY.
• Court: U.S. Court of Appeals — Seventh Circuit

68 F. 763

HALSEY et al v. CHENEY.

No. 168.

United States Court of Appeals, Seventh Circuit.

July 9, 1895

Samuel P. Wheeler and Charles H. Aldrich, for appellants.

John G Drennan, for appellee.

Before WOODS and JENKINS, Circuit Judges, and BAKER, District Judge.

WOODS Circuit Judge.

Dr Edward A. D'Arcy, a resident of Jerseyville, Jersey county, Ill., died April 25, 1863, possessed of a large estate, which he devised equally to his surviving wife, May D'Arcy, who was made executrix of his will, and two daughters, Ann Caroline Teese, one of the appellants, and Catherine Cheney, wife of the appellee, Prentiss D. Cheney except that the homestead and a tract of land, worth together about $5,000, were given to Mrs. Cheney, because the testator anticipated that Mr. Teese would benefit by inheritance or bequests from relatives in the East with whom she had lived from infancy. From the death of her husband until after the death of Mrs. Cheney, in 1877, Mrs. D'Arcy was a member of the family of the appellee. She then removed to New Jersey, where, until her death, which occurred August 12 1887, she lived with her sister Matilda Fairchild, during the winters at Morristown, and in the summers at Mendham; the residence of Mrs. Teese being at Newark. The appellants, Edmund D. Halsey, and Mrs. Teese, were named as executors of the will of Mrs. D'Arcy, and having received letters testamentary, on the 17th of February, 1888, instituted this suit against the appellee, charging and alleging, besides the facts stated and other formal matters: That the estate of Edward A. D'Arcy consisted of both real and personal property; that the devisees, by divers quitclaim deeds, made an amicable partition of the portions of the real estate devised to them in common, and the residue, excepting lands in Missouri which they continued to hold in common, they proceeded to sell, and to divide the proceeds; that Mrs. D'Arcy at the death of her husband was advanced in years, unaccustomed to business, and ignorant to her duties as executrix; that Cheney was a plausible man, of good character, and of winning address and manners, and by means thereof obtained her confidence, and induced her to commit to him the care and custody of her estate; that he assumed the active management of the estate of Edward A. D'Arcy, acting therein as the agent, attorney, and trustee of the executrix, and personally received into his hands the entire proceeds of the estate, but that the particulars of his service cannot be stated, because the papers relating to the estate are not on file in the office of the county clerk, and, according to the statement of the clerk, had been removed; that the interest of Mary D'Arcy in the estate and the amount received by Cheney as and for her share was a large sum, to wit, $20,000; that, in the year 1871, Mrs. D'Arcy received from the estate of her brother, Alexander McEowen, notes, bonds, and money to the amount of $10,000, which, together with the proceeds of the estate of her husband belonging to her, were, from time to time as they came to her, received by Cheney, upon his undertaking and agreement to act as her trustee in loaning the same, and were by him loaned, whereby her estate was largely increased; that, by reason of his influence over her, Cheney was able to postpone any full accounting with Mrs. D'Arcy, although he did long prior to her death render partial accounts, 'which your orators now have,' but which do not bring the account to the time of her death; that he retained the whole of said money in his hands as trustee, excepting small payments made as stated in the bill; that he never rendered to her a full and fair account of said trust, or of the income and profits, nor to the complainants, as executors, since her death, although requested in a friendly way to do so, but, on the contrary, refused to give to complainants any information on the subject; that in 1877, when Mrs. D'Arcy went to reside in New Jersey, there was in Cheney's hands, held in trust for her, of principal and accumulations, the sum of $25,000, of which he paid her occasional small sums, aggregating not more than $500; that, at sundry times after the death of her husband, Mrs. D'Arcy became seised of divers lots, lands, and real estate in Illinois and elsewhere, and that, while holding towards her the confidential relation of trustee, and availing himself of the influence he had over her, Cheney, for the purpose of his own gain, and without adequate consideration, procured from her, either to himself or to other for his benefit, deeds of conveyance for every square foot of real estate she owned; that this was systematically carried on for years, your orators charge, fraudulently, and Cheney should in equity establish the fairness of the several transactions; that Cheney sold timber from lands in Missouri, and received therefor $8,000, of which he never accounted to Mrs. Cheney for her share; that by reason of frequent changes of investment made by Cheney, sometimes taking securities in his own name, and intermingling the moneys of Mrs. D'Arcy with his own, an intelligent account cannot be state, except by Cheney; that, disregarding his duty as trustee, he has refused to make any statement whatever. The bill prays that Cheney be made party, and required to answer, but not under oath; that, on the hearing, an account may be taken of his doings in connection with Mrs. D'Arcy's estate; that an account may be stated, under the direction of the court, of all moneys received by the defendant or properly chargeable to him on account of the trust; that the complainants may have a decree against him for the balance due them as executors, also a decree that the several conveyances of Mrs. D'Arcy to the defendant or to others in his interest were fraudulent; that the defendant be required to show that the transactions were in good faith; and that, in all cases where the consideration was not adequate, the defendant be decreed to hold the estate in trust, if he has not parted with the title; and, if he has parted with the title, that he may be charged with the value and compound interest.

The defendant answered, denying many of the essential averments of the bill; particularly that he had been the agent, attorney or trustee of Mrs. D'Arcy as executrix, in respect to the management of the D'Arcy estate; that the property or proceeds thereof had come into his hands; that he had been her agent, attorney, or trustee in respect to her individual property derived from that estate, or from the estate of her brother, or that her property or money had come into his hands upon his agreement to act as trustee in loaning the same; and alleging that all his acts and doings for her had been done by him as her son-in-law, in order to conserve her interests, and without compensation, and that he had made to her full and fair accounts and statements, to her satisfaction, and paid over to her what was due.

Issue having been joined by a replication in denial, a reference was made to a special master to take an account, 'and for the better discovery of the matters aforesaid,' it was ordered that the defendant with 30 days submit to the master a full, true, and accurate account, with dates and amounts, etc., and that the master examine witnesses, and embody the testimony in his report. ...