Harmon v. Weston

• Citation: 102 N.E. 470,215 Mass. 242
• Parties: HARMON, Probate Judge, v. WESTON et al.; AMERICAN SURETY CO. v. HARMON, Probate Judge.
• Decision Date: 26 May 1913
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

215 Mass. 242

102 N.E. 470

HARMON, Probate Judge,

v.WESTON et al.;

AMERICAN SURETY CO.

v.HARMON, Probate Judge.

Supreme Judicial Court of Massachusetts, Essex.

May 26, 1913.

Report and Appeal from Superior Court, Essex County; Loranus E. Hitchcock, Judge.

Action by Rollin E. Harmon, Judge of Probate, against Henry E. Weston and another; and suit by the American Surety Company against Rollin E. Harmon, Judge of Probate. The court ordered judgment for plaintiff for the penal sum of the bond given by the American Surety Company as surety, and reported the case to the Supreme Judicial Court; and there was a decree for defendant in the second action, and plaintiff appealed. Judgment affirmed, with directions to issue execution; and decree affirmed.

W. C. Cogswell, of Boston, for plaintiff.

Alfred C. Vinton, of Boston, for A. C. Vinton, as administrator.

John H. Stone, of Boston, for defendant Pratt.

Hutchins & Wheeler, of Boston, for American Surety Co., of New York.

W. C. Cogswell, of Boston, for defendants Cogswell and Jenkins and for plaintiff in Harmon v. Weston.

SHELDON, J.

The first of these cases is an action upon the bond given to the judge of probate by the first named defendant as one of the trustees under the will of Nathaniel Weston, with the second named defendant the American Surety Company (hereinafter called the company) as surety. There was a breach of the bond, and judgment has been entered against the defendant for the penal sum of the bond, with interest from the date of the writ. The case was referred to an assessor to determine the amount for which execution should issue; his report has been made, and the facts therein stated have been found to be true; and the case comes to us upon a report from the judge of the superior court.

Henry E. Weston and his brother William H. Weston were duly appointed and became trustees of the fund in question, then amounting to about $150,000. By the will of Nathaniel Weston, the testator who created the trust, the income of the fund was to be paid to his nephews Edward S. Weston, Henry E. Weston, William H. Weston and Lawrence W. Jenkins, during their lives. On the death of each nephew the share of the principal of which he received the income was to be paid ‘to his issue if any, and in default of issue, to whomsoever he may by will devise and bequeath the same, or order it to be paid over to. And in default of issue and a testamentary disposal of the same, to my [the testator's] heirs at law.’ By a codicil to his will, the testator provided as follows: ‘I revoke so much of my will as relates to my nephew Lawrence W. Jenkins and make no provision for him.’

Edward S. Weston died in 1882; the share of the trust fund of which he had the income has been properly disposed of; and no question arises in reference thereto.

Henry E. Weston had a power of attorney from his brother William, and had the active management of the trust, though William signed some papers with him, and was aware of some parts of his conduct. He never filed any account in the probate court. He misappropriated much of the income and about $123,000 of the principal of the trust fund. In 1902 he was removed by the probate court from his position as trustee. His cotrustee, William H. Weston, died on May 21, 1905. Walter C. Cogswell has been appointed trustee of the fund by the probate court, and now holds that office.

The two trustees, Henry and William, on their appointment in 1896 gave separate bonds, each in the sum of $150,000, to the judge of probate, but each with the same surety, the company. They gave at the same time their joint written agreement, under seal, to the company, whereby, in consideration of the company's having become surety upon the two bonds mentioned, they agreed, among other things, that they would at all times indemnify and save the company harmless from all damages, liabilities and expenses whatever; that the company should at its option have and be entitled to exercise in their name or otherwise all their rights, remedies and privileges in the premises; that nothing in the agreement nor any act of theirs in the premises should operate to abridge, defer or limit the right of the company to become subrogated to all rights or remedies, or to limit or abridge or in any way interfere with any rights, remedies or privileges, whether by subrogation or otherwise, of the company; and that the right of the company to subrogation was affirmed and extended to all their rights and privileges in the premises.

The plaintiff now contends that execution should issue for the full amount of the deficiencies in the principal of the fund, with interest on the different items thereof from the respective dates of their conversion, and for the income not paid to William or to William's assignee with interest thereon, up to the limit of the amount of the judgment with interest thereon. Only the company defends the suit; and its contentions will be dealt with hereafter.

[1] By the terms of the statute in force both when this bond was given and now, the proceedings herein are to be ‘conducted in like manner as is provided [by statute] relative to actions on bonds given by executors or administrators.’ Pub. St. c. 143, § 18; R. L. c. 149, § 29. Those provisions applicable to this case are found in the third clause of Pub. St. c. 143, § 20, and R. L. c. 149, § 31, that ‘if the action is brought for a breach of the condition in not accounting for the estate as required by law, execution shall be awarded, without expressing that it is for the use of any person, for the full value of all the estate of the deceased that has come to the hands of the executor or administrator, and for which he does not satisfactorily account.’ In our opinion, that is the rule to be followed in this action. Conant v. Kendall, 21 Pick. 36;Newcomb v. Williams, 9 Metc. 525;Winslow v. Otis, 5 Gray, 360, 363;Choate v. Arrington, 116 Mass. 552. The remedy given by R. L. c. 162, § 38, as amended by St. 1907, c. 129, is cumulative; it gives an additional protection to that afforded by a suit on the bond.

[2][3] So too we are of opinion that the obligation of a surety upon a probate bond is the same as that of the principal. The principal and the surety are jointly liable, not severally, or jointly and severally, as was the case with the bond sued on in Briggs v. McDonald, 166 Mass. 37, 40, 43 N. E. 1003. If the surety has not been wholly discharged (Thayer v. Finnegan, 134 Mass. 62, 45 Am. Rep. 285), only one judgment can be rendered against both; and that judgment is for the default of the principal, and for the amount for which he is liable. As was said by Loring, J., in Bassett v. Fidelity & Deposit Co., 184 Mass. 210, 214, 68 N. E. 205, 206 (100 Am. St. Rep. 552): ‘This is more than a technical rule of law, it is an instance where the true character of a surety's liability comes to the surface.’ The rule often has been declared by this court. See for example Chapin v. Waters, 110 Mass. 195, 197;Choate v. Arrington, 116 Mass. 552;McKim v. Hibbard, 142 Mass. 422, 428, 8 N. E. 152. So it was said by Wells, J., in Choate v. Arrington, 116 Mass. 556, ubi supra: ‘The surety is liable for whatever is properly chargeable to his principal in the official capacity on account of which the bond was given.’ Of course it can make no difference that in this case the principal, though named as a defendant, has not been found, has not been served on, and has not appeared. The surety is still liable for the default of the principal, and to the full extent of that default, not exceeding the amount of the judgment.

[4] But it is upon a hearing in equity that the amount for which execution is to issue, that is, in this case, the amount of the assets which are not satisfactorily accounted for, is to be determined; and it is only to enforce payment of the amount equitably due that process is to issue. Pub. St. c. 143, § 20; R. L. c. 149, § 31; c. 177, § 10; Shurtleff v. Ferry, 138 Mass. 259. The amount to be paid is not necessarily the whole amount for which account has not been rendered in the probate court, but that which has not been accounted for either to the probate court, or by payments made directly to or for the benefit of the parties entitled thereto, though made without the authority of the court, or otherwise. This was the doctrine of Browne v. Doolittle, 151 Mass. 595, 25 N. E. 23, although that was a proceeding against the administrator and not an action upon his official bond. So in Forbes v. Allen, 166 Mass. 569, 44 N. E. 1065, payments made by an executor to the beneficiary of a trust created by the will but not actually established by the executor, although they were made without authority from the court, without special application to any particular claim or demand, and in excess of the amount of a legacy given directly to that beneficiary, were yet credited to the defendants (principal and surety alike, as we have seen must be the case) in a suit upon the executor's bond.

[5][6] Applying the principle stated to the facts before us, it appears that until the death of William H. Weston in May, 1905, the income of the fund was payable to Henry E. Weston and William H. Weston, one half to each. But upon the company's paying the amount of this defalcation in both principal and income, it would by operation of law be subrogated to the rights of these life tenants from the date of the bond by which its liability was created. Stetson v. Moulton, 140 Mass. 597, 5 N. E. 809;Blake v. Traders' National Bank, 145 Mass. 13, 12 N. E. 414. And by the joint agreement of these trustees with the company, made when the bonds were executed, they expressly created a conventional subrogation against both of them. Accordingly, if this income or any part of it should be included in the amount now to be paid by the company, as soon as it was received by the new trustee it would be his duty to pay this income over to the company as the...