Donnelly v. Alden

• Decision Date: 04 January 1918
• Parties: DONNELLY et al. v. ALDEN (two cases). ALDEN v. DONNELLY et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

229 Mass. 109

118 N.E. 298

DONNELLY et al.

v.ALDEN (two cases).

ALDEN

v.DONNELLY et al.

Supreme Judicial Court of Massachusetts, Essex.

Jan. 4, 1918.

Appeal from Superior Court, Essex County; Jabez Fox, Judge.

Bills to set aside a mortgage by Annie J. Donnelly and others against Frederick L. Alden and others and by Alden and others against Donnelly and others to impress trust upon a fund held by the administrators de bonis non of the estate of Peter F. Donnelly, grandfather of the first petitioners, and cross-bill by the administrators to recover back moneys paid by Peter Donnelly's executors to Alden and others. From the decree granting relief in suit to set aside the mortgage, defendant Alden appeals. Decree affirmed, bill in suit by Alden and others to impress trust dismissed, and in suit by the administrators to recover payments decree ordered to be entered dismissing the cross-bill.

The bill of complaint in the suit to set aside the mortgage is as follows:

(1) The petitioners are minors and bring this petition by Katherine Donnelly, of said Lynn, their mother, guardian and next friend.

(2) The petitioners are the children of Francis J. Donnelly, of said Lynn, and the grandchildren of Peter Donnelly, deceased, late of Lynn.

(3) Said Peter Donnelly died on the 5th day of July, 1914, leaving a will which was duly admitted to probate, by the terms of which will all of said Peter Donnelly's estate was left to his wife, Annie Donnelly, his son, Francis J. Donnelly, and his daughter, Annie J. Donnelly, in trust, nevertheless to invest carefully, the net income to be paid to his said wife during her lifetime and at her death the net income to be paid to his said children, Francis J. Donnelly and Annie J. Donnelly, or the survivor of them during their lives, and at the death of the survivor of them to convey and divide per capita the entire estate amongst the children of said Francis J. Donnelly and said Annie J. Donnelly.

(4) Said Annie J. Donnelly died during the lifetime of said Peter Donnelly leaving no children. Said Francis J. Donnelly and said Annie Donnelly the widow are still living. Said Francis J. Donnelly and said Annie Donnelly were appointed executors under the will of said Peter Donnelly on the 3d day of August, 1914, and were appointed trustees under said will on the 25th day of February, 1915, said appointments being made by the probate court for the county of Essex, and said appointees duly qualified by giving bond.

(5) Among the assets left by said Peter Donnelly was a certain piece of land with the buildings thereon located in said Lynn, and bounded and described as follows: * * *

(6) Immediately upon their appointment as executors, said Francis J. Donnelly and said Annie Donnelly without authority of the probate court, and without any authority by said will of said Peter Donnelly undertook to carry on a retail shoe business in the city of Lynn which had been conducted by said Peter Donnelly prior to his death.

(7) In the course of conducting said retail shoe business said Francis J. Donnelly or said Francis J. Donnelly and said Annie Donnelly incurred indebtedness to a firm known as Alden, Walker & Wilde, of which firm the defendant is a copartner, to the amount of $4,500, which indebtedness was for shoes sold and delivered by said firm and which indebtedness your petitioners say was the personal indebtedness of said Francis J. Donnelly or of said Francis J. Donnelly and said Annie Donnelly and was in no way the indebtedness of the trust estate left by said Peter Donnelly.

(8) On or about the eighth day of March, 1916, said Francis J. Donnelly and said Annie Donnelly to secure the payment of their said personal indebtedness to said firm of Alden, Walker & Wilde, purporting to act in their capacity as trustees under the will of said Peter Donnelly, gave to said Frederick L. Alden a mortgage on the real estate mentioned in paragraph 5 for $4,500, copy of which mortgage is hereto annexed and marked B, and which mortgage was recorded by the defendant in the Essex South District Registry of Deeds, Book 2323, page 546.

(9) The petitioners say that there was no consideration for said mortgage other than the personal indebtedness of said Francis J. Donnelly and said Annie Donnelly for the goods sold them as hereinbefore set forth, and that said Francis J. Donnelly and said Annie Donnelly had no right or authority as trustees under the will of said Peter Donnelly, or in any other capacity to mortgage said real estate belonging to the trust estate to the defendant for such indebtedness, and the petitioners are informed and believe, and thereupon aver, that the defendant at the time of receiving said mortgage was fully aware of the limitations upon said Francis J. Donnelly and said Annie Donnelly, as trustees as aforesaid, and was fully aware that they had no authority to give such mortgage and obtained said mortgage by threatening to begin suit against said Francis J. Donnelly and said Annie Donnelly for the price of the shoes so sold them.

(10) The petitioners by virtue of said will have a vested remainder in said real estate which is likely to suffer or to be wiped out providing said mortgage is allowed to stand, and the petitioners have no plain, adequate and complete remedy at law.

Petitioners asked for cancellation of said mortgage.

Edward J. Flynn and William J. Holbrook, both of Boston, for appellant.

H. D. Linscott and J. J. Doherty, both of Lynn, for appellees.

RUGG, C. J.

These are suits growing out of the estate of the late Peter Donnelly, hereafter called the testator. He died in July, 1914, a resident of Lynn. By will he gave all his property to trustees, who also were executors, in effect upon the trust to pay the income to his widow, Annie, during her life, and thereafter to his son, Francis, during his life, the principal then to go to the children of Francis, all of whom are now minors. The testator's property consisted in part of two parcels of real estate and two retail shoe stores in Lynn. The stores had been prosperous. Francis, who had assisted the testator in the stores, continued to carry on the business without change with the assent of his mother after the testator's death. Although the same persons were named as executors and trustees, they are liable in the former capacity under the facts here disclosed. Welch v. Boston, 211 Mass. 178, 181, 97 N. E. 893. The defendants Alden, Walker and Wilde, hereafter called the firm, were shoe manufacturers who had sold shoes to the testator. Shortly after his death Francis told one of the firm that the estate had been left to his mother and himself, that they owned the stores and were going to continue the business in the name of the estate of Peter Donnelly. Relying on these statements, the firm continued to ship goods to the Donnelly stores.

The firm had no right to rely upon the statements of Francis so far as concerns the liability of the estate. They knew that their former customer was dead. They were chargeable with knowledge of what the probate records of this commonwealth would disclose touching his estate so far as they seek to charge it with liability. The executors were not authorized either by the will or by the probate court under St. 1910, c. 411, to carry on the business of the testator. These facts would have been ascertained if the probate record had been examined. The firm also would have discovered, either from that record or from the investigation which...