Cone v. Dunham

• Decision Date: 30 June 1890
• Citation: 20 A. 311,59 Conn. 145
• Court: Connecticut Supreme Court
• Parties: CONE et al. v. DUNHAM et al.

20 A. 311

59 Conn. 145

CONE et al.

v. DUNHAM et al.

Supreme Court of Errors of Connecticut.

June, 1890.

Appeal from superior court, Hartford county.

Action by William R. Cone and others, executors of James R. Averill, deceased, against Austin C. Dunham and others, executors of Austin Dunham, deceased, and others. From a judgment for plaintiffs defendants appeal.

A. P. Hyde and C. J. Cole, for appellants. George G. Sill, Lewis Sperry, and George Eliot Sill, for appellees.

SEYMOUR, J. It appears from the findings in this case that on and before August 14, 1850, Austin Dunham owned 21 shares of the Ætna Life Insurance Company's stock, on which $l0 a share had been paid. On or about said date he "sold to, or subscribed or bought for, James R. Averill, eight shares of said stock, and said Averill paid him therefor $10 a share, and took a receipt as follows, viz.: 'Hartford, Aug. 14, 1850. Received from James R. Averill eighty dollars, being the first installment on eight shares of the Ætna Life Insurance Company's stock, standing in my name, but owned by him, and he remaining responsible for the balance of the installments when called in. AUSTIN DUNHAM.'" The object of said Averill was to conceal his interest in said stock, and it continued standing in the name of said Austin Dunham on the books of the Ætna Life Insurance Company down to the time of his death. There was nothing on the books of said company, or on the certificates of stock, or on the books of said Dunham, or on any of his papers, to indicate that said Averill had any claim or demand against any of said stock, and no notice was given to said insurance company that he had any interest in or claim to the same, and said stock was never separated from other stock owned by said Dunham, but remained in said Dunham's name with the knowledge and consent of said Averill, who never made any demand for the delivery thereof. Between August 14, 1850, and February 25, 1874, additional installments, amounting to 58 per cent., were paid upon said stock, to-wit, 30 per cent. in dividends and 28 per cent. in cash, which cash was paid by said Dunham, and repaid to him by said Averill. On February 25, 1874, the remaining 32 per cent. was called in and paid by said Dunham, who then held 58 shares. He has since received from said insurance company, in cash dividends on said stock, enough to repay said 32 per cent. installment as paid by him, and the same has been repaid in no other way. About September 15, 1875, Mr. Averill made his will, and named William R. Cone, Roland Mather, and Robert E. Day, the plaintiffs in this suit, as his executors. About September 20, 1875, he left Hartford, and has never returned, or been heard from. Just before leaving, he delivered to said Robert E. Day a sealed envelope which contained said will and certain instructions to said Cone, Mather, and Day, written upon a separate paper. September 30, 1882, when the presumption of his death, arising from his seven years' absence without having been seen or heard from, was established, said Averill's will was probated, and his executors duly qualified. An appeal was taken from the probate of the will, which was continued in the superior court until February 17, 1885, when judgment was given for the appellees. On March 3, 1885, the executors of said Averill made demand of the executors of said Dunham for said eight shares of stock, with the increment and dividends thereon, and they refused to deliver the same. The instructions which were in the sealed envelope delivered to Robert E. Day, and which had not been read by the parties to whom they were directed until about September 30, 1882, contained what purported to be a list of said Averill's securities, and among them the following item: "Also eight shares Ætna Life Insurance stock, in name of Austin Dunham, on which $68 per share has been paid by me, worth $450 to $500 per share." Austin Dunham died March 12, 1877, leaving a will, which was proved March 19, 1877, and the executors thereof qualified on said day. At his death 58 shares of said insurance stock were standing in his name, including the 8 shares claimed by the plaintiffs, and the defendants had no knowledge that any right or claim existed, or was claimed to exist, against said shares, or any part thereof. May 12, 1877, the executors of Mr. Dunham filed an inventory of his estate in the court of probate, and included in it the whole of said 58 shares of stock, and then claimed, and ever since have claimed, that the whole of said stock belonged to said estate absolutely.

The court of probate limited six months from March 19, 1877, for the presentation of claims against said estate. No claim was presented within the time so limited, either by said Averill or by any person acting for him, for said eight shares of stock or for any interest or claim therein; and no claim or demand was made, or notice of claim given, that said Averill or his estate had any interest, right, or claim in or to any of said stock, or the dividends thereon, either to or upon said Dunham's executors, or to or upon any other person, until March 3, 1885, when the plaintiffs notified the executors of said Dunham, in writing, and demanded a transfer to them of said stock, with payment of interest and dividends thereon, together with a proper account of the same, which demand they refused to comply with. November 18, 1878, the Ætna Life Insurance Company made a stock dividend of 4 shares of increased stock for each share of original stock, so that the 58 shares of stock in the hands of Mr. Dunham's executors were increased to 290 shares. July 5, 1879, and June 15, 1882, Mr. Dunham's executors distributed said 290 shares, under the provisions of the will, to and among the defendants. Said distribution was made voluntarily and pursuant to the will, without any order of distribution by the court of probate. Mr. Dunham's estate has not been settled. A large amount of property is still in the hands of his executors, and no final account has been rendered by them. Since said distribution further stock dividends have been made by said insurance company, which would increase the 8 shares mentioned in the writing of August 14, 1850, to 66 2/2 shares.

After the refusal of the executors of said Dunham to comply with the demand made upon them March 3, 1885, by the executors of said Averill, this suit was commenced, namely, on November 24, 1886, against said Dunham's executors and those to whom said stock had been distributed, as hereinbefore stated. The superior court rendered a joint judgment against all the defendants that they deliver and transfer at once to the plaintiffs 66 shares of the capital stock of the Ætna Life Insurance Company, and also pay to the plaintiffs the sum of $5,485.20, together with the further sum of $132, the same being the value of two-thirds of one share of said stock, and all dividends which may hereafter be declared and paid on the above shares until the delivery thereof to the plaintiffs, as adjudged, and their costs, taxed at —— dollars, from which judgment an appeal is taken to this court.

Among the defendants' reasons for appeal are the following, viz.: "Because the court held that the plaintiffs were not barred by their failure, and the failure of their testator, to present their claim against the estate of Austin Dunham within the time limited by the court of probate, and were not barred by their neglect and failure to bring their suit within the limitations of the statute; and because the court held that the plaintiffs' claim and suit were not barred by the statutes of limitation, either general or special." The pleadings raised these issues. They were ably argued by counsel, and, inasmuch as, in our judgment, a correct decision of them is decisive of the case we shall confine ourselves mainly to their consideration.

Do the statutes of limitation, relied upon by the defendants, defeat the plaintiffs' right of action? This question requires, for its correct answer, a thorough examination of the character of the trust raised between the parties by the transaction of August 14, 1850, a transaction which, the plaintiffs claim, raised an express, technical, and continuing trust, not cognizable at law, but within the proper, peculiar and exclusive jurisdiction of a court of equity, and therefore not subject to the statutes of limitation, and which, the defendants claim, on the contrary, raised only an implied trust, cognizable at law, and therefore subject to the statutes of limitation. Bouvier defines "express trusts" as those which are created in express terms in the deed, writing, or will; and "implied trusts" as those which, without being expressed, are deducible from the nature of the transaction as matter of intent, or which are superinduced upon the transaction by operation of law as matters of equity, independently of the particular intention of the parties; and adds that the term is used in this general sense, including constructive and resulting trusts, and also, in a more restrictive sense, excluding those classes. Perry, in the fourth edition of his work on Trusts, says: "Trusts are divided into simple and special trusts. A simple trust is a simple conveyance of property to one upon trust for another, without further specifications or directions. In such case the law regulates the trust, and the cestui que trust has the right of possession and of disposing of the property, and ...