In re Workman's Estate

• Decision Date: 09 March 1937
• Citation: 65 P.2d 1395,156 Or. 333
• Parties: In re WORKMAN'S ESTATE. [*] v. COBB et al. CARRUTHERS
• Court: Oregon Supreme Court

65 P.2d 1395

156 Or. 333

In re WORKMAN'S ESTATE. ^[*]

CARRUTHERS v. COBB et al.

Supreme Court of Oregon

March 9, 1937

En Banc.

Appeal from Circuit Court, Multnomah County; Jacob Kanzler, Judge.

Proceedings in the matter of the estate of Harper Workman, deceased wherein H. J. Carruthers, executor of the estate of Harper Workman, filed suit against Elizabeth A. Cobb and others. From an adverse decree, the executor appeals.

Decree modified and, as so modified, affirmed.

KELLY J., BEAN, C.J., and CAMPBELL, J., dissenting.

Charles M. Thomas and W. E. Richardson, both of Portland, for appellant.

Wilber Henderson, of Portland (Henderson & Warner, of Portland, on the brief), for respondents.

ROSSMAN, Justice.

This is an appeal by H. J. Carruthers, executor of the estate of Harper Workman, deceased, from two orders of the circuit court of Multnomah county, probate department. The first order denied a petition filed by Carruthers January 27, 1936 and the second denied a petition filed April 22, 1936. The second petition in all of its material parts was a duplicate of the first.

The following is a summary of the second petition: After Workman's death and the admission of his will to probate the appellant, who was nominated in the will as executor applied to the circuit court for an order appointing him to that office, but his application was denied, and A. C. Callan, one of the respondents, was appointed administrator with the will annexed. The appellant appealed to this court, with the result that the order denying his appointment and appointing Callan was reversed by a decision announced October 8, 1935. See In re Workman's Estate, 151 Or. 475, 49 P.2d 1136. The circuit court, upon receipt of the mandate, entered an order November 27, 1935, appointing the appellant executor of the deceased's estate. September 4, 1935, Callan filed his final report as administrator, and on October 7, 1935, it was approved. A supplemental final report, filed October 8, 1935, was approved on the same day. After Callan had been discharged as administrator, he was, without the knowledge of the appellant, "erroneously appointed by the Circuit Court of Multnomah County, trustee, claiming the same to be under the Last Will and Testament of Harper Workman, deceased. Thereafter said A. C. Callan, trustee, commenced a suit in the Circuit Court of Multnomah County, Oregon, to remove a cloud from the title and to set aside a deed held by the Western Investment and Holding Company." The concern just named does not claim to be the owner of the property involved in that suit, but holds the title in trust. "This matter was not closed, or attempted to be closed by the said administrator. The real estate with the legal title in the Western Investment and Holding Company aforesaid, was inventoried by the administrator and appraised at $7,000.00 ***. The said matter should have been closed through said estate. In order to defeat and circumvent the decision of the Supreme Court, the attempt to close said estate was made as alleged and said matter was not included or disposed of therein. In a further attempt to defeat and circumvent the decision of the Supreme Court, and in connection with the said final report and supplemental final report, and the approval thereof, the trustee under the will was petitioned for and obtained as alleged. The court appointed A. C. Callan trustee, notwithstanding the provisions of the will expressly provides that this executor H. J. Carruthers shall and is instructed to make payment to certain legatees for a period of ten years. With this executor fully appointed and qualified and under approved bond of $8,000.00 the probate court has refused by order to either permit this executor to bring suit upon and against the Western Investment and Holding Company for settlement of said trust or accounting therein, or to authorize said executor to petition the circuit court to intervene in said cause or to collect rents under the lease of said property. ***" The appellant has demanded payment to him of all rentals payable by the tenant who occupies the property just mentioned, but has received only one month's rent amounting to $38.83. All other payments have been made to Callan. The appellant "has made written demands on A. C. Callan, trustee, to account for the assets of the estate in his hands, to turn over all papers, documents and property to your executor," but Callan refused to do so, claiming that the estate has been fully settled. Prior to Workman's death, he and one Smith Wanamaker, as partners, were the owners of mining property in Alaska which the two operated. The estate's appraisal placed a value of $1 upon it. Prior to his death the decedent, claiming that Wanamaker had embezzled $14,000 of the mine's profits, employed W. E. Richardson, an attorney of Portland, Cecil Clegg and C. S. Collins, attorneys of Fairbanks, Alaska, "to act for him as his attorneys in the matter of such litigation as might grow out of said affair." Decedent, in order to finance "said contemplated litigation or settlement thereof," conveyed to the Western Investment & Holding Company, as trustee, the aforementioned real property, and then an $800 mortgage was executed which named Nellie Lister mortgagee. Funds derived from the mortgage were delivered to Workman, who proceeded to Alaska. While there he became ill, returned to Portland, and shortly died. The $800 mortgage has not been paid. Collins filed a claim for $150 with the appellant, and a claim for a similar amount filed by Clegg with Callan was rejected, but "both said claims are approved and allowed by your executor. *** The claim of embezzlement of the $14,000.00 by the partner of Harper Workman referred to was investigated by the U.S. income tax collector in the matter of the income taxes of Harper Workman and Smith Wanamaker." Because of this investigation Workman employed an accountant whose "claim is $150.00 *** and should be allowed and paid." In the aforementioned appeal to this court, costs and disbursements amounting to $98 were assessed "against A. C. Callan, administrator with the will annexed," but they have not been paid. "No adjudication or settlement has been made in regard to inheritance or income taxes. The administrator not only had the valuable mining property mentioned appraised at $1.00, but failed to list certain other valuable mining claims owned by Harper Workman in Alaska. Properly inventoried and appraised the amount of the estate is over $25,000.00. The State is an interested party and a considerable amount of the estate is subject to State inheritance taxes." The appellant is conducting an investigation concerning the merits of the $14,000 claim and the value of the Alaska properties. The $8,000 bond required of the appellant is excessive and should be reduced to $250. The prayer which concludes the petition asks that orders be entered holding that: (1) All things done by callan are null and void; (2) all orders made by the court pertaining to Callan "particularly the orders approving the final report and supplemental final report, discharging the administrator, exonerating his bond" be canceled; (3) the appellant be authorized to intervene in the aforementioned suit which Callan as trustee instituted against the Western Investment and Holding Company; (4) the appellant be authorized to institute proceedings against Callan for the possession of all documents "or any written information belonging to the said estate and particularly in re the mining property in Alaska and to commence and litigate an action against the said A. C. Callan as trustee for the rents collected for the property *** and also against the lessee for past and future rents and also against the Western Investment and Holding Company for rents collected and to enjoin it and A. C. Callan, trustee, from further collections"; (5) the appellant be authorized to continue his investigation concerning the Alaska mining property and the contemplated litigation pertaining thereto; (6) the appellant "be authorized and instructed to take up both the inheritance tax and income tax matters *** with the proper authorities so that clearance of probable claims may be properly disposed of"; (7) appellant's bond be reduced to $250; (8) the filing of an inventory and appraisement be postponed for six months; (9) since the appellant had no express knowledge of the proceedings concerning Callan's final reports and the orders based thereon, his failure to contest the same be deemed excusable neglect; (10) the court cancel its order overruling appellant's petition filed September 7, 1936; and (11) "the court find and order that all the real property belonging to the estate was not inventoried and appraised by the administrator; that property was appraised without proper investigation and proper determination of value; that there are claimants against said estate who are unpaid and who should be paid from the assets of the estate; that the affairs of said estate were not closed as stated in the final report and supplemental final report, and that the executor should be and is permitted to probate said estate."

Accompanying this petition is an affidavit of W. E. Richardson, one of the appellant's attorneys, in which he states: "The following bills were due and should have been paid before the estate was closed, Mortgage due Nellie Lister for $800,00, E B. Collins attorney Fairbanks, Alaska, Frank Smith an Accountant, Portland, Oregon, Cecil Clegg an attorney at Fairbanks, Alaska, $150.00, Costs allowed in the Supreme Court $98.00. That the claim of Earle Workman was allowed by the Court. That said claim was not due him and he is indebted to the estate. That Mr. Harper Workman told me that he had employed Mr. Collins and...