Burrows v. Johntz

• Decision Date: 06 March 1897
• Citation: 57 Kan. 778,48 P. 27
• Parties: BURROWS v. JOHNTZ.
• Court: Kansas Supreme Court

48 P. 27

57 Kan. 778

BURROWS v. JOHNTZ.

Supreme Court of Kansas

March 6, 1897

Syllabus

1. A claim against the assignee of an insolvent firm for a trust fund, which came into his hands along with the assigned estate, is barred by the three-years statute of limitations even though the contract with reference thereto between the claimant and the assignor was in writing. In such a case the liability of the assignee to account as trustee for the claimant is founded not on the contract, but on his receipt of funds which in equity belong to the claimant.

2. To render an assignee liable to account to a party who had placed money in the hands of his assignor as for a trust fund, it must appear either that the fund actually came into the hands of the assignee, or that it went to swell the estate of the assignor, which he, in fact, received.

3. A person who has placed in the hands of an insolvent debtor a fund for a specific purpose cannot present the claim to the debtor’s assignee in insolvency as a general claim against the estate, and thereafter pursue the fund in the hands of the assignee as a trust.

Error from district court, Dickinson county; James Humphrey, Judge.

Petition by W. H. Burrows, executor of Thomas G. Mather, deceased, against John Johntz, assignee of Lebold, Fisher & Co., insolvents, to obtain preference of a claim. From a judgment for defendant, petitioner brings error. Affirmed.

John H. Mahan and David Overmyer, for plaintiff in error.

C.F. Mead, for defendant in error.

OPINION

ALLEN, J.

On October 4, 1889, the plaintiff’s testator, Thomas G. Mather, caused $3,500 of his money to be placed in the hands of the defendant’s assignors, Lebold, Fisher & Co., to be applied in part payment for $5,000 of stock in the Lebold-Fisher Loan & Trust Company, which the parties were intending to organize. On the 31st day of the same month Lebold, Fisher & Co. executed a deed of assignment to Clarence F. Mead for the benefit of their creditors. On the 27th of November, 1889, John Johntz was duly elected assignee by the creditors. Having duly qualified and given notice as provided by law, he proceeded to allow demands against the estate of the assignors. The plaintiff’s testator, at the time fixed for considering such demands, presented his claim as follows:

"In the Matter of the Assignment of C. H. Lebold and John M. Fisher, Partners as Lebold, Fisher & Company. Presentation of Claim before John Johntz, Assignee. Comes now Thomas G. Mather, and represents that on or about the 1st day of October, 1889, he subscribed for fifty (50) shares of the Lebold & Fisher Loan Company, about to be organized, and did on or about that date pay over to said Lebold, Fisher & Co., through B.R. Abbe, on account of said subscription, thirtyfive hundred dollars ($3,500.00), no part of which sum has ever been returned or paid over to him. Thomas G. Mather, Claimant.

"State of Connecticut, County of Hartford— ss.: Thomas G. Mather, being duly sworn, on oath says that he signed the foregoing statement of claim, and that the statements therein contained are true. Thomas G. Mather, Claimant."

On the 25th of June, 1890, the claim was indorsed by the assignee, as follows: "6— 25— 1890. Within allowed. John Johntz, Assignee." On the 24th of January, 1893, William H. Burrows, executor of the estate of Mather, filed his petition in the assignment proceeding, stating the facts with reference to the receipt of the money by Lebold, Fisher & Co., and the purpose for which it was delivered to them, and asking an order requiring Johntz to pay the amount to the petitioner. Johntz thereupon filed a motion to dismiss the petition on the ground that the claim was barred by the statute of limitations. On the hearing, the assignment proceedings above noticed were introduced in evidence, and it was admitted that the assignee had in his hands sufficient funds to pay the claim if entitled to preference, although the estate was insufficient to pay all general claims in full. The court sustained the motion, holding that the claim was barred by the three-years statute of limitations. Error is predicated on this ruling. Two questions are discussed by counsel: First, whether Mather, in his lifetime, by presenting the claim as though he were a general creditor, and obtaining an allowance thereof as such, did not elect to pursue that remedy, and waive his right to charge the assignee with having received a trust fund; second, whether the claim, as against an assignee, is barred by the statute of limitations. A third question, not discussed, is suggested by the records, viz. whether, in the absence of any showing that Mather’s money was actually included in some form in the estate which came to the hands of the assignee, his executor may recover it as a trust fund.

The only question considered by the trial court, as would appear by the record before us, was that of the statute of limitations. Counsel for the plaintiff in error insists that the plaintiff’s claim is founded on a written instrument, and that the five-years stat...