In re Morgan's Estate

• Decision Date: 18 July 1904
• Citation: 77 P. 608,46 Or. 233
• Parties: In re MORGAN'S ESTATE.
• Court: Oregon Supreme Court

77 P. 608

46 Or. 233

In re MORGAN'S ESTATE.

Supreme Court of Oregon

July 18, 1904

Appeal from Circuit Court, Multnomah County; Arthur L. Frazer Judge.

In the matter of the estate of Amos H. Morgan, deceased. Wells Fargo & Co., a corporation, presented its claim against said estate to Melinda E. Morgan, as executrix, by whom it was rejected; and said Wells, Fargo & Co. appeals. Reversed.

This proceeding was instituted in the county court, sitting for the transaction of probate business, to establish a claim against the estate of A.H. Morgan, deceased. Morgan and A.W Stowell formed a partnership in 1882, engaging in the retail grocery and feed business in the city of Portland, from time to time borrowing sundry moneys from the Commercial National Bank, the assignor of Wells, Fargo & Co. On or about October 1, 1888, they sold out their business, but did not dissolve their partnership, nor did the purchaser assume any of the liabilities of the firm, or the sale include its outstanding accounts or bills receivable. At the time of the sale Morgan & Stowell were indebted to the bank in the sum of $2,500 evidenced by a promissory note for that amount, signed by the firm name. This note was renewed from time to time, Morgan signing the firm name to the renewal in some instances and Stowell in others, until December 24, 1891, when the last renewal note was given, the firm name being signed by Stowell. The interest on this note was paid to March 24, 1894. On May 1, 1889, Morgan & Stowell borrowed or became indebted to the bank in the sum of $1,000, giving their promissory note therefor, which was likewise renewed from time to time until April 25, 1894, when the other note now in controversy was executed, the firm name being signed by Stowell. No payments have been made upon it. Morgan died March 3, 1897, and a few days thereafter his wife was appointed executrix of his estate. On April 22, 1897, the bank duly presented to the executrix for allowance a claim against the estate based on the two notes mentioned. The receipt of the claim was acknowledged by the attorney for the executrix, and the bank was assured that the claim would be "examined into and allowed or rejected in due course, of which you will be advised." Mr. Morgan's estate consisted almost entirely of real property. The condition of the market was such at the time of his death that it was difficult to convert this real property into money, and the bank was indulgent, and did not press payment of its claim. Its officers, however, several times inquired of the attorney for the executrix about the matter, and were assured by him that the estate would ultimately pay all the claims against it, and leave something over, but were not advised that there was any doubt as to the validity of the claim or its allowance by the executrix. Meanwhile the Commercial National Bank sold and transferred its claim to Wells, Fargo & Co., which, in July, 1901, put it in the hands of its attorney for adjustment. Upon examining the records of the Morgan estate, the attorney found that the executrix had filed no list of claims presented as required by law, and had made no reports whatever of any of her transactions. He therefore inquired of her attorney concerning the condition of the estate, and was informed that the bank's claim had been rejected. This was the first knowledge either the bank or its assignee had of that fact. The notation of rejection on the claim bears no date, nor does the time thereof otherwise appear. Immediately on learning that the claim had been rejected, Wells, Fargo & Co. applied to the county court for its allowance under section 1161, B. & C. Comp. The county court allowed the claim, but upon appeal to the circuit court a nonsuit was entered, and hence this appeal.

Robert T. Platt, for appellant.

Ellis G. Hughes, for respondent.

BEAN J. (after stating the facts).

There are three questions presented for our consideration: (1) Whether, under section 1161, B. & C. Comp., the county court, sitting in the transaction of probate business, has jurisdiction to adjudicate and allow a claim for more than $500 against an estate; (2) whether the notes upon which the claim of the bank is based were in fact the obligations of the partnership of Morgan & Stowell; and (3) whether they are barred by the statute of limitations.

The Constitution provides: "The county court shall have the jurisdiction pertaining to probate courts, *** and such civil jurisdiction, not exceeding the amount of value of five hundred dollars, *** as may be prescribed by law." Const. Or. art. 7, § 12. It is argued that the examination and allowance of a claim against an estate under section 1161 is the exercise by the county court of civil, as distinguished from probate, jurisdiction, being, therefore limited to claims which do not exceed $500. In our opinion, this view is erroneous. By the Constitution county courts are vested with the jurisdiction pertaining to courts of probate, and the Legislature is authorized to confer upon them limited civil and criminal jurisdiction. The two jurisdictions are, however, as separate and distinct as if conferred upon separate tribunals. While sitting in the transaction of probate business, the nature and jurisdiction of a county court must be sought in the general nature and jurisdiction of probate courts as they are known in the history of the English law and the jurisprudence of this country. The allowance or ordering the payment of claims against estates which are in process of administration has always been considered an appropriate subject for the jurisdiction of probate courts. 2 Woerner, Administration (2d Ed.) § 391 et seq. In this country courts exercising such jurisdiction are often invested by statute with the power to hear and determine claims against the estates of deceased persons in a summary manner, without the formality of technical pleadings. Id. § 391. Such is our statute. The subject-matter of section 1161 pertains exclusively to the administration of estates, and is clearly within the functions of a probate court. The remedy there provided is not exclusive, but is intended to afford a speedy, efficient, and summary remedy to one who has a claim against an estate which has been rejected by the executor or administrator, without the necessity of technical pleadings or the observance of the formal proceedings required in an ordinary action. Wilkes v. Cornelius, 21 Or. 348, 28 P. 135; Johnston v. Schofner, 23 Or. 111, 31 P. 254; Pruitt v. Muldrick, 39 Or. 353, 65 P. 20. That the proceedings are to be regarded, for the...