Abbay v. Hill

• Decision Date: 21 February 1887
• Citation: 1 So. 484,64 Miss. 340
• Parties: R. F. ABBAY, EXECUTOR, ET AL. v. HILL, FONTAINE & CO. AND S. F. POWEL, AND HILL, FONTAINE & CO. v. S. F. POWEL, R. F. ABBAY ET AL
• Court: Mississippi Supreme Court

1 So. 484

64 Miss. 340

R. F. ABBAY, EXECUTOR, ET AL. v. HILL, FONTAINE & CO. AND S. F. POWEL, AND HILL, FONTAINE & CO. v. S. F. POWEL, R. F. ABBAY ET AL

Supreme Court of Mississippi

February 21, 1887

APPEAL and Cross-Appeal from the Circuit Court of Tunica County HON. J. G. HALL, Chancellor.

Richard Abbay, who was the owner of two large plantations in Tunica County, and also a large amount of personal property appointed his son, R. F. Abbay, his agent, to conduct the planting and attend to all the business connected with these plantations. In 1870 he had his account with Hill, Fontaine &amp Co., cotton factors and grocery merchants in Memphis, changed from his own name to that of his son. From that date on R. F Abbay would buy provisions and plantation supplies from Hill Fontaine & Co. to carry on his father's planting operations, and then would ship them cotton, which they would sell and credit the proceeds to the account of R. F. Abbay. This continued till the death of Richard Abbay. In July, 1883, Richard Abbay died, leaving a last will and testament in which he devised and bequeathed one-half of his estate to R. F. Abbay, one-fourth to Mrs. Mary S. Leatherman, and one-eighth each to his grandchildren, Mary Abbay Powel and William G. Abbay. R. F. Abbay was named as executor by the will, and he continued to carry on the planting operations just as before the death of his father, and the account with Hill, Fontaine & Co. was also continued.

The first and fifth articles of the will of Richard Abbay, deceased, are as follows:

"1. I direct that all my just debts and funeral and testamentary expenses may be paid by my executor hereinafter named with all convenient speed after my decease, and I do hereby charge and make liable all and every my real and personal estate and effects, whatsoever and wheresoever, to the payment of the same, but I direct that my personal estate shall in the first place be applied to the satisfaction and payment of my said debts and funeral and testamentary expenses before resorting to the sale of any real estate therefor.

"5. * * * And for the purpose of the speedy, full, and certain execution of this last will by the said R. F. Abbay, I do hereby direct and empower him, acting on his own best judgment and discretion, to sell all or any part or portion of my said estate real or personal (always selling the personal estate in the first instance as in this testament before directed), deferring this, however, to his judgment and discretion, for the purpose of paying the said debts and expenses. * * * *"

In August, 1885, Mary Abbay Powel filed a bill for a partition of the land and for an account of rents accruing after the testator's death. R. F. Abbay, Mary S. Leatherman, and William G. Abbay were made parties defendant. R. F. Abbay and Mary S. Leatherman filed an answer setting up that during the management of Richard Abbay's affairs and his estate by R. F. Abbay from 1870 to the time of the filing of the answer, R. F. Abbay had, as the agent of his father during his life and as executor afterward, contracted a large debt with Hill, Fontaine & Co., which debt, though charged to R. F. Abbay, was in reality the debt of the testator; that this debt was still unpaid, and that a partition of the land could not be made until it was paid; that the will creates an express trust in the executor for the payment of this and the testator's other debts, and that the courts should enforce this trust. The answer is made a cross-bill, with the prayer that the court adjudge the Hill, Fontaine & Co. debt to be a debt against the estate of the testator and not against R. F. Abbay, and that the will be held to create an express trust in the executor for the payment of the debt.

The complainant answered this cross-bill averring that the claim of Hill, Fontaine & Co. had not been registered within twelve months after publication by the executor of a notice to the creditors of Richard Abbay, deceased, to come forward and register their claims, and therefore it was barred, and denying that any trust was created by the will which took the claim out of the operation of the statute requiring registration of such claims. Mrs. Powel, the complainant, having died, at the March term, 1886, of the chancery court, the cause was revived in the name of S. F. Powel, her sole heir and devisee. On March 31, 1886, Hill, Fontaine & Co., on their own application, were admitted as parties to this suit, and afterward filed an answer to the original and cross-bills, in which they set up their debt against the estate of the testator, and resist partition of the land until it is paid, claiming that the will creates an express trust in the executor for the payment of debts, and that their claim is not subject to the statutory bar in reference to registering claims against estates of decedents.

On August 2, 1886, Hill, Fontaine & Co. filed an original bill against R. F. Abbay individually and as executor of the will of Richard Abbay, deceased, Mrs. Mary A. Leatherman, S. F. Powel, and William G. Abbay, and praying that their claim be enforced against the estate of Richard Abbay, deceased, and against R. F. Abbay individually. S. F. Powel and W. G. Abbay answered this original bill, setting up the failure to register the claim, and denying that the will created an express trust for payment of debts, and also the three years' statute of limitations against open accounts. R. F. Abbay and Mrs. Leatherman answered, admitting that Hill, Fontaine & Co. were creditors, pleading the failure to register their claim, and neither admitting nor denying that the will of Richard Abbay, deceased, creates an express trust for the payment of debts.

By consent of the parties these two cases were consolidated and tried together.

The Chancellor held that the account between Hill, Fontaine & Co. and R. F. Abbay was "a mutual and open current account" within the meaning of § 2671, Code of 1880, and that it was therefore not barred by the three years' statute of limitations against open accounts; that the claim of Hill, Fontaine & Co. was barred as far as the realty was concerned because of the failure to register within twelve months after publication of notice to creditors, the provisions of the will not taking it out of the operation of the statute, but that the undistributed personalty of the estate of Richard Abbay, deceased, was liable for their claim. An account was ordered to be stated between Hill, Fontaine & Co. and the estate of the testator, and a partition of the realty made between the several heirs.

Thereupon R. F. Abbay and Mrs. Mary S. Leatherman appealed, and also Hill, Fontaine & Co.

Decree reversed and cause remanded.

Croft & Cooper, for R. F. Abbay and Mary S. Leatherman, appellants and cross-appellees.

We insist that the will of R. Abbay, deceased, created an express trust upon his real estate for the payment of his debts.

The first clause of the will "charges and makes" liable all of his real and personal estate for the payment of his debts.

The fifth "directs and empowers" his executor to sell any or all of his real and personal estate for the payment of his debts, and gives his executor free discretion to sell either real and personal estate, as he may deem best, for the payment of his debts.

Now, we submit that the law in England and in Mississippi is substantially the same, by statute.

Here, and there, real estate of a decedent, whether he dies testate or intestate, is chargeable with the payment of all his debts upon a deficiency of personal assets, and in neither country can this liability be avoided, by will or otherwise.

The doctrine that land devised to be sold for the payment of debts, or charged with debt by will is equitable assets, and to be administered as such, still prevails in Virginia, North Carolina, and Kentucky, and is an important feature in their jurisdiction, notwithstanding there are statutes in those States similar to ours, making real estate of decedents legal assets for the payment of debts upon a deficiency of personalty. Speed v. Morris, 8 B. Monroe 499; Bull v. Bull, 8 B. Monroe 352; McCandless v. Keene, 13 Grattan 615; Gaw v. Hoffman, 12 Grattan 620; Morris v. Morris, 4 Grattan 293; Henderson v. Benton, 3 Ired. Equity 257; Helm v. Darley, Adm'r, 3 Dana 186; Cloud's Ex. v. Adams, 4 Dana 603; Speed's Ex. v. Nelson's Ex., 8 B. Monroe 499.

If there had never been any statute in Mississippi making real estate liable for debts, clearly the real estate under this will would be equitable assets for the payment of debts, and a court of chancery would execute the trust and administer the real assets, upon the doctrine that equality is equity.

We submit that by no rule of construction known to the courts, can this act of the legislature of Mississippi be held to have abrogated the common-law right of a testator to charge his real estate with payment of debts.

We are aware that Perry, in his work on Trusts, announces the doctrine broadly that in the United States trusts, charges, or other directions in wills for the payment of debts have no legal operation so far as creditors are concerned. Perry on Trusts, § 559.

We submit that the authorities do not sustain Mr. Perry. We will not weary the court with an examination of his authorities; we will dismiss him with this statement, that we have carefully examined his authorities, and found that they do not sustain his text.

If this will charges the real estate of R. Abbay with the payment of his debts, and we think we have shown that it does, the charge is certainly an express one, and being an express charge, we submit that the executor holds it in trust for Hill, Fontaine & Co. until their debt is paid, and that no statute of limitation can run...