Easton v. Courtwright

• Citation: 84 Mo. 27
• Parties: EASTON, Surviving Partner, Administrator of Partnership Estate, v. COURTWRIGHT et al., Appellants.
• Decision Date: 31 October 1884
• Court: United States State Supreme Court of Missouri

84 Mo. 27

EASTON, Surviving Partner, Administrator of Partnership Estate,

v.COURTWRIGHT et al., Appellants.

Supreme Court of Missouri.

October Term, 1884.

Appeal from the Marion Circuit Court.--HON. JOHN T. REDD, Judge.

AFFIRMED.

Geo. A. Mahan and Thomas H. Bacon for appellants.

(1) No appeal having been taken from the order of sale of real estate, the circuit court had no jurisdiction to dismiss that proceeding. The administrator not having appealed from the action of the probate court sustaining the judgment creditors' motion applying the proceeds of sale, could not, by filing at the same term, a motion to vacate such action, and by an appeal from the overruling thereof, acquire any right in himself, or confer upon the circuit court any jurisdiction to dismiss the judgment creditors' said motion, or the proceedings of the probate court thereon. As to this motion, the judgment creditors bore the relation of plaintiffs. The only appeal from the probate court was the administrator's appeal, and if it was premature, it alone should have been dismissed. From the action of the circuit court, setting aside the order of the probate court sustaining the judgment creditors' motion, they had the right to appeal. (2) The organic law of Missouri (Const. 1875, art. vi, sec. 34), authorizes the creation of probate courts with power to grant letters of administration, and such grant is not restricted to cases of estates owned exclusively by decedents, but may and does extend to cases of partnership estates held in trust for decedent partner's legal representatives ( Caldwell v. Hawkins, 73 Mo. 450), whose beneficial estate or right therein cannot be either protected except by an administration ( Wiles v. Maddox, 26 Mo. 77; Gilham v. Kerone, 45 Mo. 487; Rapp v. Vogel, 45 Mo. 524), or ascertained, except by a final settlement ( Ibid.), and in such matters the circuit court had and has no original jurisdiction. R. S. 1879, sec. 1102, p. 201; sec. 1176, p. 209; Compare First, &c., v. Robberson, 71 Mo. 326, 341; Ensworth v. Curd, 68 Mo. 282; Pearce v. Calhoun, 59 Mo. 271; Titterington v. Hooker, 58 Mo. 593. (3) The appellant's judgments of allowance are conclusive that the administering surviving partner refused to pay their demands (Wagner's Statutes, 1872, page 80, section 63), and these judgments could and did bind all the partnership effects ( Ibid., last clause), including all property of the survivors therein ( Ibid.), and the probate court had the power to classify said allowed demands against the administering surviving partner ( Ibid.), and to order the payment thereof ( Ibid., page 79, section 58), and to cause the partnership real estate to be sold to pay said judgments.

Mathews v. Hunter, 67 Mo, 293. (4) As classification is purely a judicial act ( Miller v. Januey, 15 Mo. 268), the administering surviving partner cannot classify ( Pfeiffer v. Suss, 73 Mo. 245), and e contra, the statute empowered the probate court to classify against the administering surviving partner the allowed demands (section 63, Wagner's Statutes, 1872, page 80), and the power to classify cannot imply less than two classes, and as these two classes are set forth only in section 64, Wagner's Statutes 1872, page 80, this section applies to administering partners especially, as that section confers the right of classification on all just demands paid, which right could not apply to a regular administrator ( Dullard v. Hardy, 47 Mo. 403; Schoenreich v. Reed, 8 Mo. App. 356), and upon classification the administering surviving partner could not pay second-class demands in preference to first-class demands, and much less could he have an authority which, whether exercised or not, would enable him to receive in payment for partnership real estate sold, the unallowed defaulted deposit checks of the bank. The State, &c., v. Woods, 36 Mo. 73. At a public sale of such character, the holders of such depreciated paper might doubly outbid the judgment creditors. (5) The object of administration is to settle up the estate within a special limit of time, and to this end the law of administration authorizes the decedent's representative to shorten the period of limitation on all debts matured against the estate so that a ten years' limitation may be reduced to two years, ( Labeaume v. Hempstead, 1 Mo. 417; Richardson v. Harrison, 36 Mo. 96), and this can be accomplished only by the administrator's publication of legal notice. The administering surviving partner giving bond to settle the partnership estate in two years, etc., cannot comply with this obligation except by publishing such a notice, and the statutes gave the administering surviving partner the same powers as are conferred upon the regular administrator. Wagner's Statutes, 1872, p. 120, sec. 10.

Anderson & Boulware for respondent.

PHILIPS, C.

Joseph G. Easton, Landon C. Easton and Henry C. Easton were partners in the business of banking at Hannibal, Missouri, under the firm name of “Joseph G. Easton & Co.” In March, 1877, Joseph died. The concern was largely in debt and had a large amount of assets. Henry C. Easton, as if it were necessary, applied to and received from the clerk of the probate court of that county, letters of administration, as surviving partner on the partnership estate. He gave the requisite bond as such surviving partner. He also gave notice by advertisement of his administration, requiring the creditors of said firm to exhibit to him, for allowance, within one year from the date of letters, demands against the estate, under penalty of being barred at the end of that time. Thereafter the creditors of the firm, including the appellants, from time to time, presented to said surviving partner their claims, and received a dividend of twenty per cent. on the principal. Afterwards the appellants presented their demands to the probate court for allowance and classification. The court allowed the same and classified them in the first and second classes respectively. The other creditors, of whom there were a large number, stood on the presentation of their demands to the survivor.

The administering partner made his second annual settlement with the probate court in May, 1879, and in July following, as such surviving partner, he presented to the probate court his petition for the sale of the real estate of the firm, to raise the necessary money to pay off the remaining debts of the estate. The court made the usual order of publication of notice of the application, as in case of an ordinary administration. On the return day of said notice the appellants appeared in the probate court and filed a motion to have the proposed order of sale so conditioned, that, after the payment of costs, the money derived from said sale should be applied exclusively to the payment of the demands so allowed and classified by the probate court. This motion recited, inter alia, that many of the claimants had been paid in full. The probate court sustained this motion, and made the order of sale accordingly. Afterwards, and during the same term, the surviving partner filed a motion to modify and vacate so much of the said order as directed the application of the proceeds of the land to the said probated claims. This motion was refused by the probate court, from which the administering partner appealed to the circuit court. The circuit court, on hearing, set aside the judgment of the probate court, and dismissed the petition in the cause, and directed that the costs accruing in the probate court, up to the application for appeal, be paid by Henry C. Easton, and that all subsequent costs be paid by the appellants, Courtwright et al. From this judgment Courtwright and the other promoters of the special order of the probate court have appealed to this court.

The sum of the propositions of law asserted by the appellants, is as follows: That under an administration by a surviving partner, demands against the partnership estate should be presented to the court of probate for allowance and classification, as in the case of an ordinary administration of the estate of a deceased partner, and should be paid in the order of such classification, pr rata, and that the probate court has jurisdiction and the right to order the surviving partner to pay out of the proceeds of the sale of partnership real estate the demands allowed by the probate court in preference to demands presented only to the surviving partner.

Other declarations of law were requested by the appellants, but as they all range themselves around these central propositions, and depend upon their legal truth, it is not necessary to set them out in detail.

I. It is conceded that, at common law, jurisdiction over matters of probate was vested largely in the ecclesiastical courts; while jurisdiction over partnership assets belonged exclusively to the courts of chancery. The surviving partner retained exclusive possession and control of the firm assets and property, in trust for the payment of the debts of the partnership, and for the benefit of the heirs and distributees of the decedent. In the conduct of his trusteeship he was subject alone to the supervisory jurisdiction of a court of equity. In this country this jurisdiction and method of procedure is generally regulated by statute; and when not so regulated or modified it remains as it did at common law. In this state the administration of the estate, sui juris, of decedents, is conducted through the local probate courts, while the assets of a partnership, dissolved by the death of one of its constituent members, are administered and disposed of as at common law, except so far as the rights and duties of the surviving partner are limited and controlled by statutory enactments. We shall note the statutory innovations touching this question, so far as their review may serve to aid in the proper construction and understanding of the present statute. It is one of the recognized canons of interpretation of a statute...