In re Kelley's Estate

• Decision Date: 03 January 1938
• Docket Number: 26534.
• Citation: 74 P.2d 904,193 Wash. 109
• Court: Washington Supreme Court
• Parties: In re KELLEY'S ESTATE. v. KELLEY et al. KELLEY

74 P.2d 904

193 Wash. 109

In re KELLEY'S ESTATE.

KELLEY v. KELLEY et al.

No. 26534.

Supreme Court of Washington

January 3, 1938

Department 2.

Appeal from Superior Court, Adams County; Matt L. Driscoll, Judge.

Proceeding in the matter of the estate and guardianship of Grant Kelley Melvin Kelley, and Albert Kelley, minors, wherein Albert Kelley filed a petition against H. F. Kelley and another. From an adverse judgment, defendants appeal.

Judgment modified.

Ott &amp Cross, of Ritzville, and Jas. A. Williams, of Spokane, for appellants.

Cannon McKevitt & Fraser, of Spokane, and Albert J. Galen, of Helena, Mont. (Frank J. Blade, of Spokane, of counsel), for respondent.

ROBINSON Justice.

This case illustrates one of the many weak spots in our system of administration of guardianship estates. It is further typical of a class of cases which have become so regrettably familiar as to seriously challenge the attention of both bench and bar.

A wife dies intestate, leaving minor children who become entitled to a portion of her community share. Their father becomes their guardian. Long accustomed to the unrestricted management of the community property and unfamiliar with legal concepts, he does not realize his responsibility as a trustee of the children's portion; or, if he does dimly realize it, when he is brought face to face with what seems to him a golden opportunity, but one requiring the employment of every financial resource at his command, he uses the trust fund in the sincere belief that whatever technical breach may be committed will be atoned for by the certain doubling or trebling of his wards' estate. When the investment fails and the children arrive at majority, they summon their father into court to account. In some of the cases, as in this, the father has treated his wards with such affectionate consideration and liberality that it is difficult to regard a suit against the father as anything other than ungrateful. But a sound public policy requires that little or no remedial distinction be made between breaches of trust which are deliberate and intentional and those which are well-intentioned, or which, for some other reason, may be thought to be somewhat excusable. The effect on the ward's estate is the same in either case, and, if he brings suit, he is entitled to recover.

The wife of H. F. Kelley died in 1918, leaving three minor sons, of whom the youngest, Albert Kelley, is the respondent. Upon a settlement of the estate, the respondent was entitled to a one-sixth interest in a section of land in Adams county. Appellant H. F. Kelley was appointed guardian of his three sons. On February 22, 1932, the respondent, Albert Kelley, arrived at the age of twenty-one years, and shortly thereafter demanded an accounting. None being furnished, this proceeding was instituted on October 27, 1934, by filing a petition in the guardianship proceedings reciting the appointment of H. F. Kelley as guardian, the giving of a bond of the Fidelity & Deposit Company of Maryland, the petitioner's coming of age, the failure of the guardian to file an account, and alleging that the guardian and the surety were liable in the sum of $2,283.33, with interest, and the statutory 10 per cent. penalty, and praying for an order directing that citation issue requiring the guardian to appear and account, and upon such accounting that judgment be entered against the guardian and his surety for the amount of the alleged liability, with interests, penalty, and costs. On the same day an order was made directing the clerk to issue such citation. On the same day, the clerk issued a citation directed to the guardian and surety requiring them to appear on December 19, 1934, 'then and there to show cause, if any you have, why the order and judgment prayed for in said petition should not be made and entered therein.' The citation and petition were served on the surety on October 29, 1934. No other proceedings were ever instituted, and no summons was issued or served, and the jurisdiction, if any, over the surety was acquired by the issuance and service of the citation.

Appellant Fidelity & Deposit Company appeared specially and contested the jurisdiction of the court by a motion to quash, on the ground that the citation was insufficient to confer jurisdiction so far as it was involved. No immediate hearing was held on this motion to quash, and, in fact, it was not formally passed upon until February 5, 1936, on which date it was denied. In the meantime, however, the guardian filed an account on December 17, 1934, to which the respondent excepted, and a hearing was had in October, 1935, which resulted in the court's ruling that the ward was entitled to the entire relief demanded. No order or judgment, however, was then entered. Subsequently, in February, 1936, the court having denied the surety's motion to quash, issues were made up between the respondent and the surety; the surety, however, preserving its special appearance. On May 12, 1936, additional evidence was taken, and, the court adhering to its previous announcement, findings of fact, conclusions of law, and judgment were entered against both the guardian and surety for the full relief demanded, and both have appealed.

The most important question raised by the sixteen assignments of error is whether or not the court had jurisdiction to proceed against the surety by citation. The appellant's surety contends that its liability on the bond could only be enforced by a civil action begun by the issuance and service of summons, as provided in Rem.Rev.Stat. § 220. It is insisted that there is no provision in the statutes for the entry of money judgments in probate proceedings or for the issuance of execution on such judgments, or provisions for costs, as in a plenary action, and that the probate court is vested only with a limited jurisdiction. In this connection, appellant relies not only upon the wording of various sections of Remington's Revised Statutes, to wit, sections 1371, 1373, 1572, 1575, 1589, and 1590, but also upon many cases decided by this court, including Stewart v. Lohr, 1 Wash. 341, 25 P. 457, 22 Am.St.Rep. 150; Huston v. Becker, 15 Wash. 586, 47 P. 10; Horton v. Barto, 17 Wash. 675, 50 P. 587; Estate of Gorkow, 28 Wash. 65, 68 P. 174; In re Decker's Estate, 105 Wash. 221, 177 P. 718; State ex rel. Brown v. Long, 180 Wash. 602, 41 P.2d 396; and particularly relies on State ex rel. Nolte v. Superior Court, 15 Wash. 500, 46 P. 1031, and In re Alfstad's Estate, 27 Wash. 175, 67 [193 Wash. 114] P. 593. General statements, such as 28 C.J. §§ 512 and 513, and 24 C.J. §§ 498 and 2602, are cited, together with a great number of citations from other jurisdictions. We conclude, from an examination of these authorities, that neither the general statements from Corpus Juris nor the decisions of the courts of other states are helpful; being based upon statutes differing from our own. For the most part, the decisions cited from this court antedate the present Probate Code which was enacted in 1917. No cases construing its provisions appear in our reports prior to volume 100 thereof, and few prior to volume 112.

The general provisions contained in Rem.Rev.Stat. §§ 1589 and 1590, are very broad indeed. It is declared to be the intention of the Probate Code that the courts shall have full and ample power to settle all estates of minors, and, if the provision of the Code with reference to the administration and settlement of such estates should be insufficient or doubtful, the court should have the authority to proceed in any manner which might seem right and proper, and it is further declared that, in exercising any of its jurisdiction and powers, the court is authorized to make and issue all kinds of orders, judgments, citations, notices, summons, and other processes, not inconsistent with the act, which may be considered proper or necessary in the exercise of such jurisdiction. Furthermore, a superior court sitting in probate loses none of its powers as a court of general jurisdiction. See State ex rel. Keasal v. Superior Court, 76 Wash. 291, 136 P. 147, expressly overruling In re Alfstad's Estate, supra.

It was held in Re Gardella, 152 Wash. 250, 277 P. 846, that the court may enter judgment against the guardian upon settling his account. We think the surety, upon filing the bond, becomes, in a very real sense, a party to the guardianship proceedings, and, in effect, consents to the exercise of the broad jurisdiction conferred upon the court, as above stated, and that those sections of the Code warrant the court in proceeding against the surety by citation and in entering judgment against the surety, as was done in the case at bar; and we are the more content to so hold because this method of proceeding not only avoids multiplicity of suits, but also gives the surety his day in court in a more real sense than the system for which the appellant surety contends. This is true because, under that system, a judgment may be entered against the guardian, without notice to the surety, which, in the absence of fraud or collusion, will be conclusive against the surety. Goodwin v. American Surety Co., Wash., 68 P.2d 619. Under the procedure followed in this case, the surety is afforded full opportunity to deny the alleged liability of the guardian and to litigate every phase of the question. The conclusion to which we have come as to this matter also disposes of the assignment based upon the statute of limitations, since it amounts to a holding that this proceeding was instituted at the time of the filing of the petition, followed by immediate service. This was well within the limitation period.

At the first hearing, in which the surety took no part, it appeared from the oral testimony of the...