National Casket Co. v. Sweet

• Decision Date: 16 September 1915
• Parties: NATIONAL CASKET CO. v. SWEET et al. PORTER LIVERY CO. v. SAME
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

221 Mass. 587

109 N.E. 942

NATIONAL CASKET CO. v. SWEET et al.

PORTER LIVERY CO. v. SAME

Supreme Judicial Court of Massachusetts, Essex.

September 16, 1915

Appeal from Superior Court, Essex County; J. F. Quinn, Judge.

Actions by the National Casket Company and by the Porter Livery Company against John L. Sweet and others, on a probate bond. Judgment for defendants, and plaintiffs appeal. Reversed.

COUNSEL

Williams & Copeland, of Boston, for appellants.

H. R Bygrave, of Boston, for appellee Title Guaranty & Surety Co.

OPINION

LORING, J.

Horace W. C. Sweet died testate some time before November 29, 1909 at a date not stated in the record. On November 29, 1909 John L. Sweet was appointed administrator with the will annexed (Horace W. C. Sweet's) estate and gave a bond in statutory form with the defendant surety company as surety. 'Within three months thereafter' he gave notice of his appointment. 'Thereafter' (at a date not stated in the record) he filed an inventory 'showing personal property to the value of $1,290.29, and real estate to the value of $3,000, subject to a mortgage of $1,700.'

On the first Monday of January, 1912, the Porter Livery Company recovered judgment against John L. Sweet as administrator

as aforesaid, in the sum of $1,279.65, with costs to the amount of $11.63. On May 12, 1912, the National Casket Company recovered a similar judgment against him in the sum of $1,324.44.

Executors were issued on both of the judgments. On January 5, 1912, the Porter Livery Company caused demand to be made upon the administrator for payment of the execution, but he neglected and refused to pay the judgment or to show to the deputy sheriff sufficient goods or estate of the deceased to be taken on execution for that purpose. At some time not stated in the record, the National Casket Company, after taking out execution on the judgment recovered by it, made due demand upon the administrator; but Sweet neglected or refused to pay that judgment or to show to the deputy sheriff sufficient goods or estate of the deceased to be taken on execution for that purpose. Afterwards (on dates not stated in the record) the two actions now before us were brought on the same bond, one by each of the two judgment creditors. John L. Sweet died on January 26, 1913, after the actions were brought. Subsequently the plaintiffs discontinued against the principal defendant (John L. Sweet, administrator as aforesaid). Since that time both of the actions have been prosecuted against the defendant surety company alone.

On April 21, 1913, the executors of the will of John L. Sweet filed an account for him as administrator of Horace W. C. Sweet, showing the exhaustion of the personal estate in the payment of the aforesaid mortgage note and charges of administration. This account was allowed by the probate court on the same day, without notice to creditors by publication or otherwise. A petition by these plaintiffs to reopen that account is now pending. On April 22, 1913, the estate of Horace W. C. Sweet was represented and adjudged to be probably insolvent. The real estate has not yet been sold.

The parties in each case agreed upon certain facts set forth in a written agreement. Thereafter the cases were heard by a judge ^[1] sitting without a jury. He made the following finding: 'From the statement of agreed facts I conclude and find that at the date of the demand upon the administrator he had not in his hands sufficient moneys of said estate to pay said judgment, the personal estate having been theretofore properly and lawfully expended by him and that there was not, otherwise, any failure to properly administer the estate.' In addition he made a general finding for the defendant in each case. On these findings judgment was entered for the defendants and from those judgments the plaintiffs took the appeals which are now before us.

The special finding of the judge below doubtless was based on the following facts agreed to by the parties:

'The said John L. Sweet had been endeavoring to sell the real estate belonging to his testator for a sufficient sum to pay, together with the personal estate in his hands, all the debts of his testator lawfully due and payable. The personal estate in his hands was insufficient for this purpose and the market for the real estate was slow and narrow. The real estate was worth enough, if sold at a fair price, to insure the payment of all debts of the testator.'

The defendant surety company (in effect) has argued that the case presented to the administrator with the will annexed was the case of an estate where the personal property was sufficient to pay off a mortgage on a parcel of real estate which, if sold at auction,

would not be sufficient to pay the debts of the testator because the market for it 'was slow and narrow,' but which, 'if sold at a fair price,' would realize enough to pay 'all debts of the testator.' Under these circumstances it was (or at least could be found by the judge to have been) the duty of the administrator to do what he did, namely, to endeavor to sell the real estate 'at a fair price' and thus pay the testator's debts in full. That to do that he had to obtain a license to sell the real estate at private sale, and he could not obtain such a license until he had obtained a bid; (R. L. c. 146, § 9), and that he had not been able to obtain a fair bid before he died, although he had been endeavoring so to do; that under these circumstances the special finding of the judge, if not required by the facts agreed upon, was at least warranted by them.

We pass by the objection that the finding is based on facts submitted to the superior court at the trial of the action brought for breach of the probate bond in place of on the facts shown by the settlement of the administrator's accounts in the probate court. The finding is open to that objection. But that is not the objection to it which is decisive.

The decisive objection is that where the estate has not been represented insolvent there is prima facie a breach of the second condition ^[2] of an executor's or administrator's bond when on demand being made he neglects to pay an execution issued on a judgment against him in his official capacity or to show sufficient goods or estate of the deceased to satisfy it.

Whether there is a breach of the executor's or administrator's bond under these circumstances depends upon the construction to be given to R. L. c. 149,§ 20. ^[3] Interpreted literally the provisions

of that section are satisfied by construing it to give the judgment creditor a right to put the bond in suit without obtaining the authority of the probate court to take that action. But taken in connection with the scheme of the proper winding up of the estate of a deceased person as a whole and in connection with the sections following it, we are of opinion that by the true import of this section the failure under the circumstances stated in R. L. c. 149, § 20, to pay or to exhibit sufficient goods or estate of the deceased prima facie is a breach of the second condition of the executor's or administrator's bond in case of an estate which has not been represented insolvent.

By R. L. c. 141, § 1, no action can be brought by a general creditor of the estate against an executor or administrator until after the expiration of one year from his giving bond for the performance of his trust. And by section 2 of the same chapter, on the expiration of that year the executor or administrator (who has given due notice of his appointment) can pay all debts of which he has had notice provided that, based upon the demands of which he has had notice, the estate is not insolvent. After the expiration of two years no action can be brought against the estate provided the executor or administrator gave due notice of his appointment. R. L. c. 141, § 9. If during the intervening year a creditor for the first time presents his claim he is entitled to be paid out of the surplus funds left in the hands of the executor or administrator, if there be any. By R. L. c. 142, § 2, ^[4] it is (in effect) made the duty of an executor or administrator to represent the estate insolvent if it appears that the estate is insufficient to pay all debts of which he has had notice, in order that the estate may be ratably distributed among the creditors.

The effect of these provisions is: First, to make debts owed by the testator or intestate due one year after an executor or administrator Gore v. Brazier, 3 Mass. 523, 3 Am.Dec. 182; Cooke v. Gibbs, 3 Mass. 193, 197; Harmon v. Osgood, 151 Mass. 501, 24 N.E. 401. The right originally given to the creditor to attach the goods or estate of the deceased on mesne process and the right which he still has to take them on execution were given not to afford him an opportunity to get priority over other creditors of the deceased. It was not and is not intended that one creditor of a deceased person should obtain a preference over other creditors. But the right of attachment on mesne process which existed before St. 1907, c. 553, and the right of levying execution on any goods or estate of the deceased (which still exists) were given to the deceased's creditors because (when the estate has not been represented to be insolvent and the year given to the executor or administrator in which to turn the assets into cash has expired) all creditors are under the circumstances entitled to be paid and to have the cash forthcoming with which the payment is to be made. The substance of these considerations is not affected by the substitution of a right of attachment in the discretion of the judge of the probate court for the absolute right of attachment that existed before St. 1907, c. 553.

It is in the light of all these conditions...