Ashbaugh v. Sinclair, 20.
| Decision Date | 17 March 1942 |
| Docket Number | No. 20.,20. |
| Citation | 2 N.W.2d 810,300 Mich. 673 |
| Parties | ASHBAUGH v. SINCLAIR et al. |
| Court | Michigan Supreme Court |
Suit by, Murray M. Ashbaugh, receiver of the First National Bank of Pontiac, Pontiac, Michigan, a national banking corporation, against Marion Alberta King Sinclair and others, to foreclose and satisfy a lien. From a decree, defendants appeal.
Decree vacated.
Appeal from Circuit Court, Oakland County, in Chancery; James E. Spier, Judge.
Before the Entire Bench, except WIEST, J.
E. L. Phillips, of Pontiac, for appellants.
Harold E. Howlett, of Pontiac, for appellee.
Plaintiff Ashbaugh is the receiver of the First National Bank at Pontiac, which acted as a guardian for the defendants during their minority and had control of their estates. During the progress of the guardianship, the estates of the three minors, although having a net value of $80,000 at one time, did not include sufficient cash for their maintenance. The principal asset of the estates was an apartment house in the City of Highland Park, which was subsequently lost through mortgage foreclosure. The bank advanced money to itself as guardian for the maintenance of the several wards, the upkeep of their real property, and the payment of taxes thereon.
A probate court order, dated August 13, 1935, allowing the guardian's final account, shows an overdraft representing advancements to the wards in the sum of $9,669.92. This order details the allocation of this overdraft to each of the several defendants. The probate court in this order impressed liens upon the real property belonging to the several defendants in the respective amounts found due the guardian. This order was recorded by direction of the probate court in the office of the register of deeds. All of the wards have since attained their majority.
The defendants not having repaid the moneys advanced by their former guardian, plaintiff filed a bill in the circuit court of Oakland county on June 9, 1939, for the purpose of foreclosing and satisfying the ‘lien.'
Defendants challenged the validity of the ‘lien’ on the ground that the probate court had no authority to impose a lien, and also contended that, if such advances were made by the guardian during their minority, they were voluntary advances for which an equitable lien cannot now be imposed.
The trial judge stated that it would have been better practice for the guardian to have petitioned the probate court for leave to mortgage the property of the minors as security for needed advancements. The trial judge held, however, that:
‘It is the opinion of this court that equity and good conscience, as well as the protection of all minors and wards in other cases, now and in the future, where necessity requires advancement of moneys for their welfare or interest, justifies action of this court of chancery in declaring a lien on the real estate for the moneys so advanced in unquestioned good faith. * * *
‘It is, therefore, the opinion of this court that equity is only carrying out the intention of the parties in holding that a decree should be entered declaring a lien upon the respective minors' interest in the property for the amounts as set forth in the final probate court order, and declaring such amounts due and payable to the plaintiff, together with interest at five per cent from the date of said order.'
A decree was entered providing for foreclosure of the ‘lien’ thus imposed.
The jurisdiction and powers of the probate court are derived entirely from the statutes and probate courts are incapable of dealing completely with ordinary rights. They may not...
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