Pickens v. Dwight
| Decision Date | 14 August 1873 |
| Citation | 4 S.C. 360 |
| Parties | PICKENS v. DWIGHT. |
| Court | South Carolina Supreme Court |
In April, 1863, a Master in Equity received payment, in Confederate currency, of a bond, secured by mortgage of real estate, which, in June, 1861, he had taken under a decree of the Court, and which he held for the use of a party to the cause in which it was taken: Held , That the Master was not liable as for a breach of trust.
The conclusion reached by the Court in McPherson vs Lynah and Gray , 14 Rich. Eq., 121, approved, but not the reasoning of the Court.
The measure of a Master's liability for the funds of suitors in his custody is not that of a technical trustee. He is the financial agent of the Court, and the extent of his liability must be determined by the practice and course of the Court in similar cases.
BEFORE GRAHAM, J., AT CHARLESTON, JUNE TERM, 1872.
This was a bill in equity, filed in September, 1866, by Thomas J Pickens and wife against Isaac M. Dwight, James Tupper and others, and revived in 1869 against the executors of Mr Tupper, who had died in the meantime. The facts of the case are stated in the decree of the Circuit Judge, which is as follows:
The facts in this case are fully set forth in the pleadings, from which it appears that the defendant, Isaac M. Dwight, in September, 1858, contracted to purchase a plantation in St Paul's Parish, Colleton District, to an undivided moiety, of which the plaintiffs, Pickens and wife, were entitled, and the defendants, Mrs. Perry and her sons, J. Allen Miles and Jeremiah Miles, to the other moiety, for the sum of $5,000, and made a partial payment on account, and entered into possession; but finding legal difficulties in making sufficient titles, he filed a bill in the Court of Equity for Charleston District against the plaintiffs and their co-tenants of the land to enforce the agreement and perfect the title. The bill was filed on the 31st of October, 1860, and, all parties having answered, a decree was made in the cause on the 22d day of May, 1861, directing Mr. Tupper, then one of the Masters of the Court, to convey the said plantation to Mr. Dwight, in fee simple, in accordance with the contract, allowing him credit for the amounts already paid by him on account, upon his executing his bonds for the balance of the purchase money. The decree further directed that, after payment of taxes and the costs of suit, one-half of the residue of the proceeds of sale, including therein $1,000 already paid to him by Mr. Dwight, should be paid to Thomas R. Waring, trusteee of Mrs. Perry, and to her two sons, J. Allen and J. J. Miles, to be equally divided between them, and the other moiety, including $500 already paid by Mr. Dwight to Thomas J. Pickens, should be paid to John M. Pickens, to be held by him upon the uses and trusts set forth in the answer of Mrs. Pickens, provided he should first enter into bonds to said Master, with approved sureties, in double the amount paid to him, for the faithful discharge of his duties as trustee.
On the 4th June, 1861, Mr. Dwight, at the request of the parties, and for their accommodation, paid $500 more of the purchase money in cash, and executed to the Master four (4) bonds, secured by a mortgage of the plantation, conveyed to him, for the balance of the purchase money, $3,000. Three of these bonds were for $500 each, and were assigned by the Master to T. R. Waring, trustee of Mrs. Perry and the two Miles', respectively, on the 7th of February, 1862.
It was admitted at the hearing that, subsequently to the filing of the original bill in this case, these three bonds were for the proceeds of sale of the same plantation which was sold in 1867 under foreclosure of a second mortgage given by Mr. Dwight to Street. The original assignees of these bonds, parties defendant to the original bill, were, therefore, not now before the Court, nor has the purchaser at said sale, under forclosure of the said mortgage, been made a party to this suit. The plaintiffs, Pickens and wife, were not made parties to the proceedings for foreclosure of the second mortgage, because the original mortgage of Dwight to the Master had been satisfied, as to their interest therein, under the circumstances now to be stated:
John M. Pickens never qualified as trustee of his mother, Mrs. Pickens, by giving security to the Master, and never applied to the Master for an assignment of the fourth bond of Dwight to the Master for $1,500, being Mrs. Pickens' share of the purchase money; and the said bond, therefore, remained in the hands of the Master, the obligee, unassigned, until the 29th April, 1863. At that date, the bond being past due, Mr. Dwight paid to the Master, Mr. Tupper, $1,710.51, being the amount of principal and interest then due on said bond, in Confederate States Treasury notes, and the bond was delivered up to him, and a satisfaction pro tanto entered on the mortgage by the Master. Of this payment it appears the complainants had no notice until after the 26th of April, 1866, the date of Mr. Dwight's letter to Thomas J. Pickens. The sum of $1,710.51, so received by the Master, was deposited by him in the Bank of the State of South Carolina to the credit of the case of Dwight vs. Pickens, as required of him by law; and was, subsequently, invested by said Master in $1,555 Confederate States 8 per cent. bonds, which he held as assets of the same cause, subject to the order of the Court.
The original bill in this case was filed on the 6th of September, 1866, to cancel the receipt and satisfaction of Master Tupper, and to set up the original bond and mortgage, and to foreclose the same; and failing in that, then to make Mr. Tupper personally liable for the amount thereof.
After all the defendants to the original bill had answered Mr. Tupper died, and this bill was filed on the 14th July, 1869, to revive the suit against his executors. The executors of Tupper not having filed an answer to the bill of revivor, and having since, as they alleged, fully administered his estate, which was not sufficient to pay his specialty debts, an order was made at the hearing, with consent of plaintiff's attorney, allowing them now to answer the bill of revivor, exhibiting their administration of the estate of their testator, accompanied by certified copies of the inventories and appraisement, and the executor's account.
So far as the bill seeks to set up the bond and mortgage against the obligor and mortgagor, Isaac M. Dwight, it is clear that it cannot be sustained, for they were satisfied by the person having the legal title and right to receive, the obligee and the mortgagee; and unless there was fraud or collusion between him and the obligor, they must be held to have been paid. This precise point was decided by the present Supreme Court, in the case of Mayer vs. Mordecai , 1 S. C., 383, and the case of Creighton vs. Pringle , Supreme Court, November Term, 1870.
So far as the bill seeks to make the estate of the deceased Master liable for receiving payment in Confederate currency of a bond past due, given to him for the purchase money, and remaining in his hands under order of the Court, it is identical with the case of McPherson vs. Linah and Gray , decided in 1866, and reported 14 Rich. Eq., 121. The only points of difference between this case and that are as to time, and are in favor of the defendants in this case. In McPherson vs. Lynah and Gray , the bond was given in 1860, and the payment to the Master was on 30th January, 1864, while in this case the bond, although given in payment of a contract of purchase made in 1858 was not executed until the 4th of June, 1861, and on that day $500 more in cash than the contract called for was paid by Dwight, at the request of the parties in interest, though in what currency does not appear. The payment to the Master was on the 29th April, 1863, Confederate currency then having a far greater purchasing value than it had on 30th January, 1864.
If, then, the case of McPherson vs. Lynah and Gray , is law, it is conclusive of this case, and the relief sought against the executors of the late Master must be refused.
It was contended by the plaintiff's counsel that the decision in McPherson vs. Lynah and Gray has been virtually overruled by the decisions of the present Supreme Court, in the cases of Mayer vs. Mordecai and Creighton vs. Pringle , already referred to, and in the case of Fitzsimons vs. Fitzsimons , 1 S. C., 400. But the two first cases were rested by the Court, upon the construction of the instruments creating the trusts, and the trustees were held liable as for breach of trust in receiving payment of bonds held by them as trustees, in Confederate currency, such receipt not being within the scope of their powers, because not in compliance with the requisitions of the settlements, which were necessary conditions to the legal exercise of the power, in the one case " upon consultation" with the cestui que trust , and in the other upon her " written consent." In the case of Fitzsimons vs. Fitzsimons , an administrator cum testamento annexo was held to have committed a devastavit in calling in a bond well secured by real estate left by his testator, and receiving payment in Confederate currency, when the money was not needed for the purposes of administration, because it was incumbent on him to show the reasonableness of his conduct in disturbing an investment acknowledged to be good. In the case of Nance vs. Nance , 1 S. C., 209, the distinction is pointed out as to the liability of trustees who " exceed the limits of their discretion," and their liability " for errors of judgment in cases where they have a right to the exercise of a discretion," and recognizes the rule which relieves them from...
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