Nagle v. Robins
| Citation | 62 P. 154,9 Wyo. 211 |
| Parties | NAGLE v. ROBINS |
| Decision Date | 07 September 1900 |
| Court | United States State Supreme Court of Wyoming |
Application for counsel fees in the Supreme Court denied November 15, 1900.
EXCEPTIONS to final report of William A. Robins as guardian of the estate of George H. Nagle, a minor. The district court decided adversely to the ward, and sustained the acts of the guardian. The ward prosecuted error. The facts are stated in the opinion.
Affirmed in part and Reversed in part.
Wells & Taylor, and Clark & Breckons, for plaintiff in error.
The constitution prohibits the Legislature from authorizing, by any kind of legislation, the investment of trust funds in the bonds or stock of private corporations. (Art. 3, Sec. 38, Sec. 27). Hence the court cannot derive any power to ratify such investments. It cannot exercise any power not specially conferred by statute, or necessary to carry out the powers so conferred. In probate matters, the district courts must act strictly within the statute, and possess no additional authority by virtue of their common law and equity powers. . .) The Legislature is alone competent to act as the general guardian of those incapacitated from acting for themselves. The power to make provision for the estates of minors resides in the Legislature as parens patriae. (Hoyt v. Sprague, 103 U.S. 613; R. R. Co. v. Blythe, 69 Miss. 939; Rice v. Parkman, 16 Mass. 326; Cooley's Const. Lim., 120-22; 11 Ency. L., 818; Randolph v. Land Co., 104 Ala. 355). The prohibition of the constitution follows as a rule which has been demonstrated by experience to be the true rule, and has received the almost universal sanction of the courts. The evidence does not support the finding that the purchase of the U. Merc. stock was solely for the protection of the capital of the ward already invested in the same company. There was no necessity for the purchase and if the guardian so represented to the court, he perpetrated a fraud on the court and that is sufficient reason for charging him with the investment. (Slaughter v. Favorite, 107 Ind. 291; 48 N. E., 128).
The burden of proof rested on the guardian, and he must establish to the satisfaction of the court that he acted with prudence in making the investments excepted to. (Thornton & Blackledge on Adm. 775-6, 758, 763, & cases cited; Brownlee v. Hare, 64 Ind. 311; Hamlin v. Nesbit, 37 id., 284; Taylor v. Burt, 91 id., 252; State v. Wheeler, 127 id., 451; Wysong v. Nealis, 41 N. E., 388.) Due care was not used in making the Altman loan. There was gross negligence in that matter. The guardian was not authorized to take a mortgage on lands situated outside the state. .) The value of the property was altogether speculative, thus making it improper as security for the investment of trust funds. (Garesche v. Priest, 9 Mo. App., 270; Adair v. Brimmer, 74 N.Y. 539; 2 Woer. Adm., 704-711; Woer. G., 207-220; 2 Pom. Eq., 1071-74.) In determining whether the security is adequate, the test is what the property would bring at forced sale. (2 Woer. Adm., 709; Perrine v. Petty, 34 N. J. Eq. 193; Gilbert v. Kolb, 37 A. 423.) The guardian must not only exercise proper care in loaning money, but he must be diligent in collecting it at maturity. A guardian is not permitted to invest the trust money in personal securities. In the Warren loan the collateral was stock in private corporations, and not only was the investment prohibited by the constitution, but it was an investment the trustee had otherwise no right to make. It was an investment, notwithstanding the transaction was a loan upon the note of the borrower secured by the collateral stocks. An investment occurs whenever the amount is represented by anything but money. (11 Ency. L. 823; People v. Com'rs., 23 N.Y. 242; Simmons v. Oliver, 43 N. W., 562 (Wis.); Tucker v. State, 72 Ind. 242; Tucker v. Tucker, 33 N. J. Eq. 236; 4 Johns. Ch. 284; 40 N.Y. 88; 2 Heisk., 126; 18 A. 1; 9 Pa. St. Worrell's App., 5 W. & S., 254.)
In making loans it is the duty of the guardian to take adequate security, though he loan to a man entirely responsible at the time. (Bogart v. Van Velsor, 4 Edw., Ch. 718.) The security was inadequate in the case of all the investments objected to. The guardian is bound in his reports to make full disclosure, yet the guardian in this case did not do so. The notes were not described as to date and time of maturity, nor was the nature of the security mentioned. It will not do to say that he talked with the judge. The matter should appear by the record. Had there been no exception to the final report the court should have sent it back to the guardian for a detailed report. (Hirshfield v. Cross, 67 Cal. 661 In re Moore, 54 P. 148.)
The orders approving the loans are not binding upon the ward. The directions of the statute were not complied with. In no instance was a day set for hearing the reports; and a day was not appointed for settlement, as required by law. (Laws 1890-91, p. 243, Sec. 3; id., Sec. 1, p. 301; Sec. 13, pp. 312-, 313; Sec. 4, p. 288; Sec. 11, p. 289; Sec. 17, p. 290; Sec. 18, p. 290; Sec. 19, p. 290; Sec. 20, p. 290-1.) The sections referred to unquestionably refer to periodical accounts or reports. Not having been made as required by statute, the orders are not binding upon the ward. (Woer. Guard'p. 324; Burnham v. Dalling, 16 N. J., Eq. 144; Guardianship of Cardwell, 55 Cal. 137; Schouler Domestic Rel., 372; State v. Roeper, 9 Mo. App., 21; Sheetz v. Kirtley, 62 Mo. 417; Bourne v. Maybin, 3 Woods, 724.) The ward cannot be bound by an approval of a partial account without notice. 2 Woer. Adm., 1124-25, 1186; 1 Thort. & Blackl. Adm. 460-1; Tiffany's Domestic Rel., 341; Horner's Pro. L., 396; 9 Ency. Pl. & Pr., 966; Frieberg v. DeLamar, 7 Tex. Civ. App. 267; In re Davis, 62 Mo. 456; Kidd v. Guibar, 63 id., 342; Radford v. Morris, 66 Ala. 283; State v. Jones, 1 S. W., 355; Henley v. Robb, 86 Tenn. 474; State v. Wheeler, 127 Ind. 451; Massick v. Beebee, 17 Kan. 47; Sherry v. Sansberry, 3 Ind., 320; Blake v. Pegram, 101 Mass. 592; Bennett v. Hanifen, 87 Ill. 31; Coburn v. Loomis, 49 Me. 406; Durworth v. Kirby, 37 N. E., 729; Coffin v. Bramlet, 42 Miss. 194.)
If the law were otherwise, the reports in the case at bar were so meager, and misleading in their nature, that the order of approval would not protect the guardian, nor would the ward be bound thereby. (Woerner Guard'p, 321; 2 Thort. & Blackl., 756; State v. Gooch, 2 Am. St. R., 284; Slaughter v. Favorite, 107 Ind. 298; Hirshfield v. Cross, 67 Cal. 662; Smoot v. Richards, 27 S. W., 967; In re Sanderson, 74 Cal. 203; 2 Pom. Eq., 902; Moore v. Asken, 85 N.C. 199; Cox v. Mauvel, 57 N. W., 1062; In re Craudstrand, 40 Minn. 438; Skelton v. Ordinary, 32 Ga. 266; White v. Sherman, 48 N. E., 128; Woerner Guard'p, 215-19,)
A guardian does not have lawful power to lend the ward's money without obtaining from the district court an order or direction to do so. The statute authorizes the court to direct the guardian to invest the moneys of the ward in suitable securities, but only after notice to persons interested in the estate. The statute is plain, and properly construed, denies to the guardian any power to invest without a previous order of court. If he does so, the ward may refuse to accept the investments. (Woerner Guard'p, 203; id 218; Sullivan v. Howard, 20 Md. 191; Hendricks v. Richards (Neb.), 78 N. W., 378; Cardwell's case, 55 Cal. 137; McIntyre v. People, 103 Ill. 142; Hughes v. People, 111 Ill. 460; Carlisle v. Carlisle, 10 Md. 440; Williams v. Campbell, 46 Miss. 57; Garesche v. Priest, 78 Mo. 126; Coffin v. Bramlett, 42 Miss. 194; Bryant v. Craig, 12 Ala. 354; Bates v. Dunham, 12 N. W., 310; Slusher v. Hammond, 63 N. W., 185; Gray v. Fox, 1 N. J. Eq., 259; Shepherd v. Newkirk, 21 id., 302; Winslow v. People, 117 Ill. 152; Brown v. Wright, 39 Ga. 96; Rogers v. Tullos, 51 Miss. 685; Zimmerman v. Frailey, 17 A. 561; Hayes v. Ins. Co., I. L. R. A., 303; 42...
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