McAuslan v. McAuslan

• Decision Date: 06 July 1912
• Citation: 83 A. 837,34 R.I. 462
• Parties: MCAUSLAN et al. v. MCAUSLAN et al.
• Court: Rhode Island Supreme Court

83 A. 837

34 R.I. 462

MCAUSLAN et al.

v. MCAUSLAN et al.

Supreme Court of Rhode Island.

July 6, 1912.

Appeal from Superior Court, Providence and Bristol Counties; Christopher M. Lee, Judge.

Bill in equity by Albert H. McAuslan and others against George R. McAuslan and others. From the decree, the defendant named appeals. Affirmed.

Bassett & Raymond, of Providence (Russell W. Richmond, of Providence, of counsel), for appellant. Dexter B. Potter, James C. Collins, W. Arthur Countryman, Jr., and Everett L. Walling, all of Providence, for appellees McAuslan and others.

Eliot G. Parkhurst, Eugene A. Kingman, and Edwards & Angell, all of Providence, for appellee Jastram.

SWEETLAND, J. This is an equity appeal. The bill is brought by certain cestuis que trust, beneficiaries under the trusts contained in the will of John McAuslan, and the assignee of certain interests in said trust estate, against the trustees named in said will and the assignee under the mortgage of the interest of certain other beneficiaries. The bill asks for the removal of George R. McAuslan, one of said trustees; that an account be taken of the trust property and the application thereof by said trustees; and for a decree ordering said trustees to pay to said trust estate what shall appear to be due from them on such account. The bill alleges, among other things: That said George R. McAuslan has assumed the active management of said trusts and practically has been the sole trustee; that said trusts have been mismanaged; that said George R. McAuslan is incompetent to perform the duties of trustee; that by reason of certain investments of the trust estate made by the trustees, as specified in the bill, the trust estate has lost large sums of money; that the trustees have failed to keep proper accounts, do not act in harmony, have become personally indebted to the trust estate in large amounts, and have been adjudged in contempt of court for failure to make payments of money from the trust estate in accordance with the decree of the superior court.

Of the respondents, other than the said trustees, one joins in the prayer of the bill, another has permitted the bill to be taken as confessed against him, and the others, as minors, have submitted their interests to the care of the court. The respondent trustee Amelia B. McAuslan in her answer admits all the essential allegations of the bill and joins in the prayer for a receiver. The other respondent trustee, George R. McAuslan, in his answer, among other things, admits that the trustees have made losses in the management of the trust estate, but sets out facts which he claims excuse him from blame. After replication filed, on motion of the complainants, and after notice to the respondents and hearing, the superior court, by decree entered April 2, 1910, referred the cause to a master, "to examine and state the accounts of the executors and trustees with the estate of the said John McAuslan and report to the court" a number of particulars regarding the amount of the estate at the death of John McAuslan, the dealings of the trustees with the principal of the estate, the amount of the income received from the estate, and the disposition of said income by the trustees. The master by this decree was also directed to report to the court whether George R. McAuslan should or should not be removed as trustee of said estate.

After a number of hearings before the master, of which all the parties received due notice, the master prepared a draft of his report, and all the parties were notified by the master that said draft report was on file in his office for the inspection of the parties and their solicitors, and that at a certain day and hour named he would hear objections to said report. No objections were made by any of the parties, and the master filed his report unsealed in the superior court. On motion, of which the parties had due notice, the superior court, by decree entered on March 4, 1911, confirmed said report. By said report it appears that the master has taken testimony as to all the questions referred to him, and has endeavored by his consideration of such testimony and his conclusions thereon to give to the court the assistance which it had required. Thereafter the superior court, by decree entered April 15, 1911, removed said George R. McAuslan from being trustee as aforesaid, fixed the amount due from said trustees to said trust estate, ordered the said trustees to pay the sum so found to be due to the receiver of said trust estate, made said sum so found to be due a lien on the interests of said trustees in the trust estate, and provided that, if said sum so found to be due was not paid to said receiver within SO days thereafter, the interests of the said trustees in the trust estate should be liable to be applied toward making good to the trust estate said sum, or such part thereof as might then remain unpaid. Prom this decree the said George R. McAuslan has appealed.

At the outset of the consideration of this appeal we are met by the objection of one of the respondents, whose interest in the present matter is similar to that of the complainants, that the reasons of appeal stated by the respondent George R. McAuslan cannot be considered, as they are objections to acts of the superior court preceding the decree confirming the master's report; that the decree of April 15, 1911, from which this appeal is taken, is merely auxiliary to the decree confirming the master's report, which is the final decree; that an appeal from the decree of April 15, 1911, can bring in question before this court only the proceeding in the superior court subsequent to the decree confirming the master's report, and cannot interfere with that decree; that the respondent George R. McAuslan could have raised the objections stated in his reasons of appeal only upon an appeal from the decree confirming the master's report. This brings before us the question of what is the final decree in equity causes intended by our statute as the appealable decree in a cause. Previous to the passage of the Court and Practice Act equity appeals were unknown in our practice, since the period from 1867 to 1871, when appeals to the full court were permitted from both the final and interlocutory decrees made by a single justice of the Supreme Court. Under our present statute an appeal may be taken from the final decree of the superior court in an equity cause, and from the final decree alone, with these exceptions: An appeal may be taken from an interlocutory decree granting or continuing an injunction, appointing a receiver, or ordering a sale of real or personal property. Hemenway v. Hemenway, 28 R. I. 85, 65 Atl. 608.

What constitutes a final decree is a question not easily determined in every case. The decisions of the courts are far from uniform upon the subject. As was said by the court in McGourkey v. Toledo & Ohio Ry., 146 U. S. 536, 13 Sup. Ct. 170, 36 L. Ed. 1079: "Probably no question of equity practice has been the subject of more frequent decision in this court than the finality of decrees." The statutes of some of the states provide for an appeal from both final and interlocutory decrees, and the question before the courts in some reported cases has been whether a certain decree was an appealable one, not whether it was interlocutory or final. By the terms of the statutes of some states an appeal will lie in chancery from any decree or order "adjudicating the principles of the cause." In some jurisdictions, where the statutes permit appeals from final decrees alone, decrees which were strictly and technically interlocutory have been held to be final, when irreparable injury might result to a party if he was compelled to await the final outcome of the cause in the lower court before he could obtain a review in the appellate tribunal. For these and other reasons there is much confusion in the reports as to what constitutes a final decree for the purpose of appeal. Our statute regarding the appealability of decrees in equity is similar to the United States statute. It is in the federal courts that we find the subject, now under consideration, most frequently treated and the practice most consistent and reasonable.

We have frequently said, in regard to the removal of cases at law to this court for review, that the intent of the statute is that exceptions in such cases shall not be certified to this court until after all matters arising in the cause in the superior court have been determined. We see in the statute the same general intent with regard to appeals in equity, so far as the distinctive character of equity procedure makes such practice reasonable and expedient. From the nature of proceedings in equity, it must be held that the final decree is not necessarily the last order in the case. On the other hand, a decree should not be considered final, although it purports to declare the rights of the parties and to regulate all "actions that may be expected to be taken in the future disposition of the case." Such decrees "have no efficacy until put into the form of a judgment that is capable of being carried into execution." Patterson v. Hopkins, 23 Mich. 541. A decree which directed a trustee to sell mortgaged property as the court might afterwards direct, and referred the cause to a master to report the prior liens, was held not to be a final decree, because it was not determined what the order of sale should contain, nor what should be the form of advertisement therefor. Parsons v. Robinson, 122 U. S. 112, 7 Sup. Ct. 1153, 30 L. Ed. 1122.

With the modification which we shall consider later, we adopt, as a reasonable definition of a final decree in equity under our statute, the one approved in Grant v. Phoenix Ins. Co., 106 U. S. 429, 1 Sup. Ct. 414, 27 L. Ed. 237: "The rule is well settled that a decree, to be final within the meaning of that term as used in the acts of Congress giving this court jurisdiction on...