Ehrngren v. Gronlund

• Decision Date: 02 May 1899
• Citation: 19 Utah 411,57 P. 268
• Court: Utah Supreme Court
• Parties: JOSEPHINE EHRNGREN, RESPONDENT, v. NILS J. GRONLUND, MARTIN CHRISTOPHERSON, GEO. H. TAYLOR, AND THOMAS E. TAYLOR, APPELLANTS, CHRISTINE ROCKWELL, DEFENDANT

57 P. 268

19 Utah 411

JOSEPHINE EHRNGREN, RESPONDENT, v. NILS J. GRONLUND, MARTIN CHRISTOPHERSON, GEO. H. TAYLOR, AND THOMAS E. TAYLOR, APPELLANTS, CHRISTINE ROCKWELL, DEFENDANT

Supreme Court of Utah

May 2, 1899

Appeal from the Third District Court, Salt Lake County, Hon. A. N Cherry, Judge.

Action upon a bond of defendant Gronlund, as executor.

From a judgment for plaintiff, defendants appeal.

Affirmed.

Messrs Moyle, Zane & Costigan, for appellants.

The rule of law is plain that when a man acts in a double capacity, and the time comes when he ceases to be the one thing and becomes another, the character of the fund changes likewise, and therefore the sureties upon his bond in this first capacity are no longer liable. Wooley v Price, 37 A. 644; In Taylor v. Deblis, 4 Mason, 131; Carroll v. Bosley, 6 Yerger, 220; Watkins v. Shaw, 2 G. & J. (Md.), 220; Bell v. People, 94 Ill. 230; State v. Cheston, 51 Md. 352; U.S. v. May, 4 Mack., 4; State v. Anthony, 30 Mo.App. 625; Perkens v. Lewis, 41 Ala. 642; S.C. 94 Am. Dec., 616; Ruffin v. Harrison, 86 N.C. 190, affirming same case, 81 N.C. 208; Hinds v. Hinds, 81 Ind. 312, 315; Wooley v. Price, 37 A. 644.

The cases are clear on the proposition that if a cestui que trust is sui juris and consents to a breach of trust, he can not complain of the breach of trust as against the trustee. Booth v. Booth, 1 Beav., 125; Brice v. Stokes, 11 Ves., 319; Boole v. Munday, 103 Mass. 174; Nail v. Punter, 5 Sim., 555.

The conditions in the bond are to be construed in favor of the obligors, and the liabilities of sureties will not be extended beyond the strict letter of their contract. Victor Sewing Machine Co. v. Crockwell, 2 Utah 557; McGovney v. State of Ohio, 20 Ohio St. 93. See also Des. Nat. Bank v. Burton, 53 P. 215.

Messrs. Williams, Van Cott & Sutherland, and J. H. Hurd, Esq., for respondent.

This decree of the probate court was entitled to the same presumptions and intendments as a decree of the district court, or of any other court of record. 2 C. L., Sec. 3016; Wheeler v. Bolton, 54 Cal. 305; Evans v. Gerken, 105 Cal. 313; Schofield v. Churchill, 72 N.Y. 570.

The executor is liable, together with his sureties, because the executor's duty was never discharged until the bequest was deposited as directed by the decree of distribution. 1 Perry on Trusts, Sec. 262; Hood v. Hood, 85 N.Y. 561.

Even if the respondent could anticipate the bequest by agreement, yet her agreement would not avail the appellants, because the executor misrepresented facts and law to the respondent, she had no proper legal advice, she had just become of age, and the burden of proof is upon him to show the transaction absolutely fair. Wickersham v. Crittenden, 93 Cal. 28; 27 Ency. Law, p. 194, et seq., 213, 214, notes; Diller v. Brubacker, 91 A. D., 177 (52 Pa. 498); Pickett v. School District, 3 A. R., 105 (25 Wis. 551).

The general rule is, 1st, that in the absence of directions, a loan can only be made on the safest security; 2d, the rule is unbending that when directions are given, the loan must be made as directed. In the case at bar, neither was done. Therefore, there can be no release from liability either of the executor or his sureties. 1 Perry on Trusts, Sec. 453; 2 Woerner on Administration, Sec. 366.

MINER, J. BASKIN, J., concurs. BARTCH, C. J., did not participate in the decision.

OPINION

MINER, J.

This action was brought upon the bond of Nils J. Gronlund, as executor of the last will and testament of John Ehrngren. The respondent, Josephine Ehrngren, was the daughter of the testator, John Ehrngren. The bond was executed by Gronlund as principal, and the other defendants as his sureties, to the Territory of Utah for the use of the heirs and creditors of John Ehrngren, deceased, in the penal sum of $ 28,000, for which sum well and truly to be paid, the principal and sureties bound themselves, their heirs, administrators and assigns, jointly and severally. The obligation bound the executor to faithfully execute the duties of the trust as executor according to law. The bond was approved and filed August 1, 1890.

In the will of the deceased, the following bequest was made to his daughter, the respondent:

"Fifthly: I give and bequeath to my daughter, Josephine Ehrngren, the sum of two thousand dollars. Said amount to be placed by my executors, hereinafter to be named, in some safe investment, or deposited in some reputable bank in Salt Lake City for the benefit of my said daughter Josephine, who is to receive the interest thereof, but not the principal, until she arrives at the age of twenty-one years, when the said amount, with the proceeds thereof, is to be delivered to her, unless in the opinion of my executors hereinafter to be named, her welfare would be better subserved by drawing a portion of the said amount and investing it in a home or real estate for her before she reaches the age of twenty-one years."

The final account of the executor and petition for distribution were duly filed, and thereupon on January 3, 1893, the court ordered and decreed that the residue of said estate be distributed as follows: "To Josephine Ehrngren the sum of $ 1,635.30 cash, said amount to be deposited by said executor in Zion's Savings Bank and Trust Company of Salt Lake City for said Josephine Ehrngren. The interest of said amount to be paid her as it accrues, but the principal to remain deposited in said bank until she arrives as the age of twenty-one years, on the 5th day of January, 1896, after which date said principal sum may be paid to her."

It appears that the executor never at any time deposited said sum of $ 1,635.30, or any part thereof, in the Zion's Savings Bank, for the benefit of said Josephine Ehrngren, or otherwise, or in anywise complied with the order and decree.

The appellants contend, among other things, that when the decree was made the executor was acting as trustee, and that the sureties never became obligated to secure the faithful performance of the duties of the executor while acting as trustee in the deposit of the fund in the bank for Josephine Ehrngren, and that the court had no jurisdiction to make the order and decree made requiring the executor to deposit the money in the bank, and that the bond only holds the sureties liable to heirs and creditors, and not to legatees.

Under the will as construed by the court, the testator did not bequeath the fund in question to the executor as trustee, for the respondent in trust. On the contrary he bequeathed it to the respondent, but the enjoyment of the principal sum was postponed until she arrived at the age of twenty-one years. The decree entered required the fund belonging to the respondent to be deposited in the Zion's Savings Bank and Trust Company, for Josephine Ehrngren, and to remain there deposited until she arrived at the age of twenty-one years, at which time it was to be paid to her. This decree as between the parties was a final judgment, and as conclusive, until reversed or modified, as a decree of the district court. 2 Comp. Laws, Sec. 3016.

This decree was never appealed from, but remained in full force when this action was commenced, and the appellants thereby acquiesced therein.

Under our statute, the settlement of the accounts of an executor are final and conclusive, and a decree of distribution is conclusive, subject to a reversal or modification, and the court must distribute the amount to which each person is entitled, and such distributees may sue for the amount to which they are entitled. 2 Comp. Laws, 1888, Secs. 4241, 4262.

Sec. 4057 provides that the bond must be conditioned that the executor or administrator shall faithfully execute the trust according to law.

Sec. 4284, C. L. U. 1888, provides: "When the estate has been fully administered, and it is shown by the executor, or administrator, by the production of satisfactory vouchers, that he has paid all sums of money due from him, and delivered up, under the order of the court, all the property of the estate to the parties entitled, and performed all the acts lawfully required of him, the court must make a judgment or decree discharging him from all liability to be incurred thereafter."

The executor could not obtain his discharge so as to release the sureties on the bond until he had complied with this decree, and paid over the money as directed therein.

In Wheeler v. Bolton, 54 Cal. 302, it is held under a similar provision of the statute, that, if an executor has possession of property his duty is not ended until he has delivered the property in accordance with the decree, and not until then can he have his discharge.

In Evans v. Gerken, 105 Cal. 311, 38 P. 725, it is said in a similar case: "The decree of distribution had fixed the liability of the executor and was conclusive alike upon the sureties.

So, in Scofield v. Churchill et al., 72 N.Y. 565 it is said: "In the absence of fraud or collusion between the executor and the legatee, the decree of the surrogate is conclusive upon the sureties. It binds the principal and the sureties alike, and can not be impeached in a collateral proceeding. While the most solemn judgments do not conclude those who are neither parties nor privies, yet, when an obligee undertakes the payment of a judgment which may be recovered against his principal, he can not escape the effect of such judgment when recovered. He has bound himself to pay, and is indebted for the amount of the judgment when recovered, without regard to its legal merits. Such is the nature of...