Church v. Holcomb

• Citation: 45 Mich. 29,7 N.W. 167
• Court: Supreme Court of Michigan
• Decision Date: 10 November 1880
• Parties: CHURCH v. HOLCOMB and others.

7 N.W. 167

45 Mich. 29

CHURCH v. HOLCOMB and others.

Supreme Court of Michigan

November 10, 1880

Mortgage executed by an executrix upon the estate of her testate under license from the probate court, more than five years after the administration proceedings were commenced, but before administration was closed, held valid, and not within the general rule laid down in Hoffman v. Beard, 32 Mich. 218. A bill in equity was filed for the purpose, among other things, of establishing a lien upon lands of an estate for moneys loaned the executor thereof, for which mortgages were given, but which mortgages were assumed by the complainant and court below to be void. All the equities having been gone into, and this court holding that the mortgages were valid, held, that the bill might be amended so as to pray for a foreclosure of such mortgages.

Appeal from Barry.

L.E. &amp C.M. Knapper, for defendants.

COOLEY J.

The bill in this case was filed against the widow and heirs at law of Horton D. Holcomb, late of the county of Barry deceased, to establish a lien upon the land of which the decedent died seized, for moneys loaned by complainant to his executors, and for which mortgages were given, and also to charge the widow, the judge of probate, the counsel for the widow and several other parties with conspiracy to defraud both the estate and complainant as mortgagee. The bill was dismissed in the court of chancery, on full hearing on pleadings and proofs except as to the widow, and complainant appeals.

The bill alleges that Holcomb died February 20 1866, seized of 320 acres of land, lying in separate parcels in Barry county, and that he left a last will whereby he devised his lands to his wife and children, but with certain powers to the executors, all of which will appear by the copy of the will which is given in the margin. ^[*] That the will made the wife Adelaide D. Holcomb, and the decedent's brothers, Horace G. and Hiram W. Holcomb, executors. That the will was probated and allowed in the county of Barry aforesaid May 15, 1866, and letters testamentary issued to the persons made executors. That no order was entered by the probate court fixing the time within which the debts and legacies should be paid and the estate settled as the statute requires. That an inventory was filed July 31, 1866, showing the property of the estate to be real estate, $6,360; personal estate $1,100. That on November 26, 1867, the said executors filed their bond as testamentary guardians of the heirs at law who were minors, they having been appointed to that office by the will. That on the same day last aforesaid the executors prayed leave to sell one 88-acre lot belonging to said estate and invest the proceeds in the purchase of another parcel immediately adjoining the homestead, and the probate court assumed to grant leave, the sale was made and an order entered to confirm the same. This action of the executors and the probate court is averred to be wholly unauthorized and void, and the purchasers are made defendants as assuming to hold and claim the property which belongs to the estate.

That afterwards in December, 1871, Hiram W. Holcomb assumed to resign his trust as executor and guardian, and the probate court assumed to accept the resignation, which action of the court is alleged to be unauthorized and void. That on or about the first day of December, 1874, the widow entered into a conspiracy with one Holbrook, since deceased, with the judge of probate and with other persons who are named as defendants, to cheat and defraud the estate and all persons having claims upon or against it, or against the heirs thereof in the manner stated below. That Horace G. Holcomb was then deceased, and said Adelaide had for a long time been acting as sole executrix and sole testamentary guardian. That in furtherance of said conspiracy said Adelaide with the assistance of other defendants named did on the day last aforesaid file in the probate court what purported to be an itemized statement of her account, showing a balance in her favor of about $3,900, with a petition for the hearing and allowance thereof, and the defendant Prindle as judge of probate made a pretended order of allowance thereof, though the estate as the judge well knew, was not indebted to said Adelaide in any sense whatever, and the time allowed by the statute for settling the estate had then long passed. That afterwards on or about the eighth day of April, 1875, the said Adelaide filed her petition for leave to sell or mortgage certain lands belonging to said estate, a copy of which is also herewith given. ^[*] That on May 27, 1875, the said judge of probate assumed to grant an order for the mortgaging of said lands, a copy of which is also given, ^[*] and that defendant Adelaide gave bond in regard to said order with the defendants John H. Earle and Lucius Russell as her sureties.

That in reliance upon this order complainant was induced to loan to said Adelaide $3,000, accepting two mortgages upon said lands, of $1,500 each, given by said Adelaide as sole executrix and testamentary guardian. That of the said sum of $3,000, $150 was appropriated by said Russell and the remainder was delivered to said Earle with the avowed purpose of delivering the same to said Prindle to be paid out and distributed. That said Adelaide made a report of her proceedings in giving said mortgage, and the said judge of probate entered an order pretending to confirm the same. That all the proceedings of said Adelaide and said probate court in respect to mortgaging said lands were wholly void, and that said Adelaide under said will had no power either to sell or mortgage the lands of the estate, except under the authority of a court of equity, and that complainant's mortgages therefor create no lien and are void.

That said Adelaide is insolvent; that the money obtained from complainant has been used for the benefit of the family of said deceased and for said estate, in part, but she does not know to what extent, and she is entitled in equity to a lien on the lands therefor, and to an accounting with the defendants, and a personal decree against them. And the bill prays for a decree according to the theory of complainant's case as above stated and for other and further relief.

Such is the case made by the bill. The defendants answered, admitting the bill, the proceedings in the probate court, and the giving of the mortgages, but denying explicitly all collusion, conspiracy and fraud. Voluminous testimony was taken, and it is sufficient for our purpose to say of it that it fails to charge the defendants or any number of them with collusion to defraud the estate or to wrong complainant, or with any intentional wrong whatever. The court of chancery dismissed the bill except as against the defendant Adelaide, but assuming the mortgages to be void, made a personal decree against her that she pay to complainant the amount of her mortgages. Complainant appeals.

The first question that presents itself on the appeal is whether the complainant and the court were right in assuming that the mortgages were void. The defendants do not contest the invalidity, and have no interest in doing so, but their assent does not determine the question of law. That, however, is supposed to be settled by previous decisions of this court.

Of the previous decisions that in Matter of Godfrey Estate, 4 Mich. 308, merely holds that the court will not license the sale of lands to pay debts against an estate after the legal remedy for their recovery has been barred by lapse of time. Hoffman v. Beard, 32 Mich. 218, holds that a license to sell issued to an administrator after the estate has been actually closed, is wholly void, and may be treated as void in collateral proceedings. It is said in that case that the time allowed to an administrator in which to close up the estate must be restricted to four years and a half; but this rule is subject to exceptions, as was explained by a later case. Sarzelen v. Starkweather, 38 Mich. 96.

Does this case come within the general rule laid down in Hoffman v. Beard? If it does, that is an end to all controversy so far as concerns the validity of the mortgages; if not, that question is not disposed of by any adjudication. In our opinion the two cases differ in most important particulars.

In the first place the estate in question in Hoffman v. Beard had been closed before license to sell was granted, and the record showed the fact. In this case there had been no settlement, and the estate, whether rightfully open or not, was in fact still open. In the second place that was a case where the administration was wholly under the statute; in this case there is a will. Moreover the will by its express terms contemplates that the estate shall remain in the hands of the executors for a period longer than that limited by law for closing estates generally, and that action for partitioning the estate shall be had from time to time in the probate court. No want of competency in the testator to make such provision is suggested and probably none will be set up.

Notwithstanding these provisions it was probably still necessary that all claims against the estate should be presented and allowed within the time limited by the general law. But it was obviously the intent of the will that the widow or the executors should receive and pay out moneys in managing the estate, and supporting, maintaining and educating the children, and it was not at all improbable that the estate would be found indebted to one or more of them while in the strict discharge of what they might believe to be their duty under the will. Any such indebtedness would not stand on the same footing with debts contracted by the deceased in his...