In re McKinnon's Estate

• Decision Date: 18 December 1945
• Docket Number: 8583.
• Citation: 164 P.2d 726,118 Mont. 217
• Parties: In re McKINNON'S ESTATE. v. McKINNON. DALTON et al.
• Court: Montana Supreme Court

164 P.2d 726

118 Mont. 217

In re McKINNON'S ESTATE.

DALTON et al. v. McKINNON.

No. 8583.

Supreme Court of Montana

December 18, 1945

Rehearing Denied Jan. 4, 1946.

Appeal from District Court, Sixth Judicial District, Gallatin County; Benjamin E. Berg, Judge.

Proceeding in the matter of the estate of Alex McKinnon, deceased wherein Florence McKinnon, administratrix of the estate of Alex McKinnon, deceased, filed a final account to which Mrs Oswell F. Dalton and others filed objections. From certain portions of the order settling the final account of the administratrix, Mrs. Oswell F. Dalton and others appeal.

Affirmed.

E. F. Bunker, of Bozeman, and Frank E. Blair and Lyman H. Bennett, Jr., both of Virginia City, for appellants.

Fred L Gibson, of Livingston, and Horace S. Davis, of Billings, for respondent.

ANGSTMAN Justice.

This is an appeal from certain portions of an order allowing approving and settling the final account of the administratrix of the estate of Alex McKinnon, deceased.

The appeal presents the following three legal questions:

1. Whether the court was right in holding that the administratrix was justified in paying off a real estate mortgage after the time for presenting claims had expired and when no claim had been presented.

2. Whether under the facts the court was correct in holding that it was proper for the administratrix to amplify her final account so as to show a mistake in the description of property sold as reported in a return and account of sale of livestock which had been confirmed by the court.

3. Whether the court erred in allowing the payment of an item of $738 to Mr. K. McCallum for labor and the care of livestock.

The facts bearing upon the first legal question are these: During the lifetime of Alex McKinnon he executed a note payable to the Federal Land Bank of Spokane in the sum of $8,000, secured by a real estate mortgage. Mrs. McKinnon, his wife, joined in the execution of the note and mortgage but obtained none of the proceeds of the mortgage. A part of the indebtedness had been paid by the decedent before his death. During the course of the administration of the estate the administratrix, Mrs. McKinnon, made payments on the principal and interest as the installments became due amounting to $1,254.68, which payments were allowed and approved by the court in approving the first account of the administratrix. The administratrix paid the balance on the note and mortgage amounting to $5,022.58 in 1943. No claim on the note or mortgage was ever presented to the administratrix and the time for so doing expired in October 1940, and no court order was obtained authorizing the payment. There was ample money in the estate to pay the note and mortgage and other claims against the estate, leaving a balance in the hands of the administratrix for distribution. The estate was solvent. The court found that the mortgage indebtedness was justly due within the meaning of section 10298, Revised Codes, and that it was paid in good faith.

At the time the note and mortgage were paid there was pending an action wherein Mrs. McKinnon was plaintiff in which she sought to have set aside to her one-half of the real estate in lieu of dower. Subsequently judgment was entered therein awarding the relief to her which she demanded.

The appellants, who are sisters or issue of deceased brothers or sisters of the deceased, contend that it was illegal and unjust to them as heirs for the administratrix to pay the mortgage debt from the general assets of the estate.

It is their contention that since the claim was not presented, it was barred under section 10173 except as a charge against the property covered by the mortgage.

The administratrix contends, first, that because of sections 7052 and 10195, which make all the property of an estate liable and chargeable for the payment of debts, the administratrix was justified in paying the mortgage debt. There are cases sustaining this right under similar statutes where the decedent left a will devising certain real estate encumbered with a mortgage. Those decisions reach that conclusion in order to effectuate the intention of the testator. In re De Bernal's Estate, 165 Cal. 223, 131 P. 375, Ann.Cas.1914D, 26; In re Estate of Brackey, 166 Iowa 109, 147 N.W. 188. It has also been held that the same rule applies in the case of intestacy. Appeal of Beard, 78 Conn. 481, 62 A. 704.

Whether, in view of the holding in the case of Mathey v. Mathey, 109 Mont. 467, 98 P.2d 373, we would reach the same conclusion as did the Connecticut court need not now be determined because the action of the administratrix in paying off the mortgage must be upheld because of other statutory provisions.

The court correctly upheld her action because of sections 10194 and 10298. These sections, so far as applicable, provide:

Section 10194. 'If there be any debt of the decedent bearing interest, whether presented or not, the executor or administrator may, by order of the court or judge, pay the amount then accumulated and unpaid, or any part thereof, at any time when there are sufficient funds properly applicable thereto, whether said claim be then due or not; and interest shall thereupon cease to accrue upon the amount so paid.'

Section 10298. '* * * and if, upon such settlement of accounts, it appear that debts against the deceased have been paid without the affidavit and allowance prescribed by statute or sections 10174, 10175, and 10176 of this code, and it shall be proven by competent evidence to the satisfaction of the court or judge that such debts were justly due, were paid in good faith, that the amount paid was the true amount of such indebtedness over and above all payments or set-offs, and that the estate is solvent, it shall be the duty of the said court or judge to allow the said sums so paid in the settlement of said accounts.'

Here the court had actually approved the payment of about $1,200 interest and principal, and regarding that, no complaint is made. By so doing the court recognized the validity of the entire debt as of the time those payments were made. There is no question regarding the fact that the debt was justly due except as it might be affected by nonpresentation...