People for Use of Miller v. Myer

Decision Date17 February 1964
Docket NumberGen. No. 11846
PartiesPEOPLE of the State of Illinois, for the Use of William L. MILLER, as Administrator With Will Annexed of the Estate of Margaret H. Townley, Plaintiff-Appellee/Plaintiff-Cross-Appellant, v. Joseph MYER, Defendant-Cross-Appellee, and the National Union Fire Insurance Company of Pittsburgh, Pennsylvania, a Pennsylvania Corporation, Defendant-Appellant.
CourtUnited States Appellate Court of Illinois

Burrell & Holtan, Freeport, for appellant.

Mathis, Sloan & Littler, Peoria, Trimble & Trimble, Princeton, for appellee.

ROETH, Justice.

This case is before this court upon a stipulation of facts. From that stipulation the following appears:

On October 19, 1955, a petition was filed in the County Court of Bureau County, Illinois, by L. D. Spaulding, Jr., alleging that Margaret Townley was incompetent, that she owned personal estate of the value of $15,000, and that she had gross annual income from real estate of $1,200; said petition prayed that Zelda Neiman be appointed as conservator for said Margaret Townley. Thereafter on October 25, 1955, pursuant to said petition, Margaret Townley was adjudged incompetent and Zelda Neiman was appointed as conservator for said Margaret Townley, Incompetent, upon said Zelda Neiman entering into bond in the penal sum of $30,000 with two sureties or in the penal sum of $22,500 with one corporate surety. Zelda Neiman filed in said court her bond in the penal sum of $30,000, with Joseph Myer, defendant herein, and L. D. Spaulding, Jr., as sureties thereon, which bond was approved by the court. This bond provided as follows:

'Know all men by these presents, That we Zelda Neiman, as Principal and Joseph Myer and L. D. Spaulding, Jr., as Sureties, all of the County of Bureau and State of Illinois, are bound to the People of the State of Illinois in the penal sum of Thirty Thousand and no/100 ($30,000.00)--Dollars, lawful money of the United States, for payment of which we and each of us bind ourselves, and our heirs, executors, and administrators, jointly and severally by these presents.

'THE CONDITION OF THIS OBLIGATION IS SUCH That if the said Zelda Neiman, Conservator of the estate and person of Margaret Townley, incompetent, faithfully discharges the duties of her office according to law and does all acts which at any time may be required of her by law or a court, then this obligation is void, otherwise in full force.

'Witness our hand and seals this 17th day of November, 1955.

'Zelda Neiman (Seal)

Joseph Myer (Seal)

L. D. Spaulding, Jr.'

Margaret Townley was the owner of an undivided one-half interest in certain real estate in Bureau County. On October 15, 1959, Zelda Neiman, as Conservator for said incompetent, filed a complaint for partition of said estate in the Circuit Court of Bureau County, Illinois; that pursuant to said complaint a decree for partition was entered by the court on December 22, 1959, and said premises were subsequently sold by the Master in Chancery on January 22, 1960.

On March 25, 1960, an order was entered by the County Court of Bureau County, Illinois, in the Conservatorship of Margaret Townley, Incompetent, finding that said complaint for partition had been theretofore filed by said Conservator, that said premises had been sold by the Master in Chancery, that distribution was yet to be made, that the share of said Margaret Townley to come into the hands of said Conservator was approximately $30,000, and that said Conservator had submitted her Special Bond for Sale of Real Estate in the penal sum of $45,000 with the National Union Fire Insurance Company of Pittsburgh, Pennsylvania, defendant herein, as surety thereon; that it was thereupon ordered and adjudged by the court that the acts of said Conservator in filing said complaint in partition be approved, that the Special Bond for Sale of Real Estate be approved, and that said Conservator be authorized and directed to collect from the Master in Chancery the proceeds from the sale of said premises due to Margaret Townley, Incompetent. This Special Bond for the Sale of Real Estate was secured from a duly authorized agent of The National Union Fire Insurance Company of Pittsburgh on March 23, 1960, and at the time of the execution of it by the agent the company had no knowledge, actual or implied, of the prior partition proceedings. This Special Bond for the Sale of Real Estate provided as follows:

'KNOW ALL MEN BY THESE PRESENTS That we Zelda Neiman, as Principal, of the County of Bureau and State of Illinois, and The National Union Fire Insurance Company, of Pittsburgh, Pennsylvania, a Corporation of the State of Pennsylvania, as Surety, are bound to the People of the State of Illinois in the penal sum of Forty Five Thousand and no/100 ($45,000.00) Dollars lawful money of the United States, for payment of which we and each of us bind ourselves and our heirs, executors and administrators, jointly and severally, by these presents.

'WHEREAS, Zelda Neiman, as Conservator of the Estate of Margaret Townley, Incompetent, is about to sell real estate,

'NOW, THEREFORE, the condition of this obligation is such that if the said Zelda Neiman, as Conservator, shall dispose of the proceeds of the said sale in the manner required by law, then this obligation is void; otherwise it remains in full force.

'Witness our hands and seals this 2ord day of March, 1960.

'Zelda Neiman, as Principal (Seal)

National Union Fire Insurance Company of Pittsburgh

By Harold E. Parr

Attorney-in-fact (Seal)

'Countersigned by:

Harold E. Parr Agency

by Harold E. Parr (Agent)

National Union Fire Insurance Co. of Pittsburgh, Pa.'

There came into the hands of Zelda Neiman as Conservator between November 18, 1955, and April 5, 1960, a total sum of $31,315.07 of which $1,200.00 was a partial distribution by the Master of the proceeds of the partition sale. From this amount she disbursed $29,935.46 leaving a balance on hand of $1,379.61. Her report showing these receipts and disbursements was approved on May 3, 1960, and on that date fees were allowed to her in the amount of $1,500.00 and to her attorney in the amount of $500.00. Subsequently the conservator received the balance of the sale price in the partition suit for the ward's interest and on March 13, 1961, she reported to the County Court receipts in the total sum of $28,125.91 consisting of the prior balance on hand, $26,398.30 received from the partition sale and $380.00 in other income. She reported disbursements of $5,871.10 leaving a balance of $22,254.81 of which $22,205.00 was represented by a note of L. D. Spaulding, Jr. By appropriate proceedings in the County Court the loan of funds to L. D. Spaulding, Jr., was found to be unauthorized and the conservator was surcharged with the amount thereof with interest and directed to pay the sum into court within a short date fixed. Upon failure to comply with this order Zelda Neiman was removed as conservator and a new conservator was appointed.

Margaret H. Townley died and on November 16, 1961, the plaintiff was appointed administrator with the will annexed of her estate. The money found to be due from Zelda Neiman, never having been paid to either her successor or the administrator, the latter instituted this suit against the surety on the general bond of Margaret Neiman as conservator and the surety on the Special Bond to Sell Real Estate of Margaret Neiman. The complaint is in two counts, the first being against the surety on the general bond and the second against the surety on the special bond for the Sale of Real Estate. The trial court absolved the surety on the general bond from all liability and held the surety on the Special Bond for the Sale of Real Estate liable for the defalcation of Zelda Neiman. The surety on the special bond has appealed from the judgment against it and the plaintiff has cross-appealed from the judgment in favor of the surety on the general bond. By agreement counsel for all parties have spelled out the issues of law for determination by this court as follows:

1. Does the obligation of the Bond entered into by defendant, Joseph Myer, as surety, extend to cover the disposition of proceeds from the sale of real estate which are a part of an estate of an Incompetent?

2. Does the obligation of the Bond entered into by The National Union Fire Insurance Company of Pittsburgh, Pennsylvania, extend to cover proceeds from the sale of real estate by a Master in Chancery pursuant to a Decree entered in a partition suit filed by the Conservator of an Incompetent when, at the time of entering into the bond, the defendant, National Union Fire Ins. Co., had no notice, actual or implied, of the partition proceeding nor did it have knowledge of the fact that the property had been sold by the Master in Chancery prior to the execution of the bond?

We have no difficulty in answering the second issue as posed in the affirmative. Aside from the stipulation, the record before us discloses that from the time of the appointment of Zelda Neiman as conservator, the cost of maintaining and caring for her ward exceeded the income from the corpus of the personalty and real estate. At the time the partition suit was filed, the conservator had almost exhausted all of the corpus of the personalty during the prior five year period in caring for her ward. There remained only the undivided interest in the real estate as a source of funds for future maintenance. This she was...

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2 cases
  • Estate of Berger, In re
    • United States
    • United States Appellate Court of Illinois
    • December 23, 1987
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    • United States Appellate Court of Illinois
    • April 18, 2008
    ... ... Miller, Equip for Equality, Chicago, IL, for Appellees ...         Justice JOSEPH GORDON ... She wanted to be married to him, over V.H.'s objections, and told people that they were engaged. However, the two of them broke up; K.E.J. has since then been through a ... App.3d at 826, 232 Ill.Dec. 918, 699 N.E.2d at 1107; Miller v. Myer, 46 Ill.App.2d 106, 113-14, 196 N.E.2d 370, 374 (1964) ...         Counsel for K.E.J ... ...

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