Reeside v. Reeside

• Decision Date: 28 March 1865
• Citation: 49 Pa. 322
• Parties: Reeside's Executor v. Reeside.
• Court: Pennsylvania Supreme Court

49 Pa. 322

Reeside's Executor v. Reeside.

Supreme Court of Pennsylvania.

March 28, 1865

1865

CERTIFICATE from the Court at Nisi Prius.

This was an action on the case by Mary Reeside, executrix of James Reeside, deceased, against John E. Reeside, in which the plaintiff declared as follows:--

For that whereas, at, & c., the plaintiff as executrix had and was possessed of a large sum of money, to wit, the sum of $500,000 of the moneys and funds of the estate of sad James Reeside, deceased, and said plaintiff, for the better and speedier settlement of said estate, delivered and intrusted the said sum, to wit, at, & c., to the said John E. Reeside to be employed by him to pay the indebtedness of said estate to the parties entitled thereto in the settlement of the same, and to return the balance, if any there should be, to said plaintiff, executrix as aforesaid. And the plaintiff avers that said John E. Reeside accepted and received the said sum for the purposes of said trust, and entered upon said professional employment of settlement as aforesaid, but notwithstanding his duty in that behalf the said John E Reeside misconducted himself therein, and fraudulently appropriated the said sum to his own use, and has refused and still does refuse to apply and appropriate the same to the purposes of settlement of said estate as aforesaid, and to return the said balance to the plaintiff, to the damage of the plaintiff of $800,000.

To which the defendant pleaded not guilty, with leave, & c.

The facts, as disclosed on the trial, were as follows:--

By Act of Congress, passed February 7th 1857, a sum of money was appropriated to plaintiff in settlement of claims of her deceased husband. She had employed her son, the defendant, to attend to the claim, and he employed Joseph B. Stewart, Esq. a member of the bar, to present it before the Court of Claims and Congress. On February 25th 1857, the treasurer of the United States paid $326,501.70 on account. The warrants were endorsed in blank by plaintiff, and delivered to defendant as her agent, to pay claims, and return the balance. On the 27th or 28th February 1857, defendant returned to plaintiff $100,000 of warrants, which she brought to Philadelphia, and on March 4th 1857, deposited $50,000 in the Bank of Pennsylvania, $25,000 in the Bank of North America, and $25,000 in the Bank of the Northern Liberties. The defendant came to Philadelphia, and as early as March 7th 1857, received part of the $100,000. By the 19th March the balance of the $100,000 was drawn out of bank, except $200 in the Bank of North America, and $37,111.37 in the Bank of Pennsylvania, which was held by the bank, by reason of a bill filed by a creditor of the estate, until it failed, when the creditor received a check for $15,000, and a check for the balance was received by the defendant, and sold at a loss of $5615.36. The deposit in the Bank of North America was drawn out by two checks to order of J. E. Reeside, March 7th, $550, and March 19th, 200; one check to order of L. M. Closs, and endorsed by him and defendant, March 12th, $3500; one check to " self or bearer" March 16th, $20,500, and a small check of $50. The deposit in Bank of Northern Liberties was drawn in one check to " self or bearer," March 16th, $25,000. The deposit in Bank of Pennsylvania was drawn on as follows:-- March 4th, self or bearer, $500; March 5th, A. J. Reeside, $2000; March 5th, S.C. Perkins, $510.87; March 5th, J. E. Reeside, $120; March 12th, two checks, $9257.96, and on same day the defendant deposited that sum to his credit in the same bank, which he drew out as follows:--March 12th, $1900; March 16th, $7357.96. All the above checks were in the handwriting of defendant. The testimony of A. J. Reeside was as follows:--" Not long after the money was deposited, John came to my mother and told her there were some judgments to be paid, and there was money wanted to pay them. I asked John why he should want to draw on this money? I said that it was singular the $226,000 was not enough. He told me it was all important,--he must have the money. He got the money. He got money whenever he wanted it,--the amount was given just what he asked, and whenever he asked for it." " John generally drew checks when he wanted money, and mother signed them. When he wanted money he got it in checks, or notes, or stocks,--just as he wanted it. His demands continued till all the money was gone."

December 15th 1859, the United States treasury paid the balance due plaintiff, $39,893.54, which was received by defendant; the balance of Mr. Stewart's claim was settled March 8th 1860, by Mr. Henry M. Phillips, under defendant's directions.

The account of the plaintiff as executrix went before auditors, who awarded $40,539.64 to creditors, and a balance of $25,599.10 to plaintiff, besides her commissions, $11,341.10; and unpaid auditors and counsel fees $3302.25; total $60,792.15. The report was confirmed, and on appeal this court made a final decree in January Term 1863. This money being necessary to be produced, the defendant, after repeated requests, met his mother at Mr. Perkins's office. She represented her condition to her son, and demanded the money in his hands, and an account. Mr. Yard testified, " he (the defendant) was asked what had come of the money? He stated that he had none of the money. The question was asked where it was. He said his mother had it. He was asked if he knew what the consequence would be--and was told his mother must go to jail. He said he couldn't help it. Every effort appeared to be made to get something satisfactory out of him, but of no avail. There was a distinct call on him for an account and the money. He was requested to show what had become of the money. He said he had paid some judgments, but he couldn't account for the rest. He was told there was $40,000 due to the creditors, and the money must be somewhere."

Some means were invested in loans, but they very soon went into the hands of defendant, with the trifling exceptions shown by Joseph and A. J. Reeside.

It was proved that the defendant admitted that he had the plaintiff's money. Mr. Stewart testified that within sixty days of the 8th March 1860 (at which date the auditors had the case in hand), " I asked him where the money of the estate was. He said at one time he had $93,000--at another, $95,000; and at one time it was rising $100,000. During these sixty days he said all these sums were in his hands. All these statements were made within sixty days from March 8th 1860." He adds: " I asked John what would be the result of the estate, and how the estate was going, and what would be the amount distributed to Mrs. Reeside and the other children. He said, if the debts now before the auditor did not exceed $40,000--and, as nigh as he could tell, they would not-- there would be left between $40,000 and $50,000 for Mrs. Reeside and the other children. It was money in his hands. I knew that; for Mrs. Reeside's control of the money was but nominal. This was during the sixty days which I have spoken of." All the payments made were made by J. E. Reeside. Mrs. Reeside had no money.

The defendant paid Mr. Stewart $10,000 less on his fee than he receipted for, and $13,000 less to judgment-creditors than they receipted for. These two sums defendant had not accounted for. The receipts for the full amounts were stated as payments in plaintiff's account, and allowed by the auditors. The defendant charged and retained $18,000 as his compensation. The amount awarded to plaintiff by the auditors would have been $23,000 more, if the receipts of Mr. Stewart and the judgment-creditors had stated truly the amounts paid to them.

A nonsuit was then asked for and entered by direction of the court, THOMPSON, J., delivering the following opinion:--

" If it were possible to consider this an action of assumpsit for the recovery of the money which passed into the defendant's hands, I do not see how, under the evidence, it could be sustained. The testimony all goes to show that the very large sums of money which passed into his hands, did so as the agent of the executrix, the plaintiff, for the payment of debts or claims on the estate. It is equally apparent that very large sums were disbursed under the agency. This establishes a case of principal and agent, and no account stated or settled. The form of action in such circumstances is material; it is account render. Although assailed very severely of late, it still serves as a remedy in a case like the present. A direct action to recover all the money in such a case does not lie. There is no implied promise to return money delivered to an agent to be expended on the agency, unless indeed where the agent refuses to administer it at all. What I mean is, that if an agent expends money in the course of an agency in which there are money items and transactions, the principal cannot sue to recover back money paid on an item in the course of an agency on an alleged misappropriation. If so, every item might be so tested. The law has provided a remedy in account render, in which the entire accounts may be tested, misappropriations disallowed and charged over to the agent, credits given, and a balance struck. It is so far equitable in form as to admit of the parties being sworn and compelled to disclose all about the matters of the agency. The action, however, here is neither in assumpsit nor account render.

It is for fraudulent appropriation to his own use by the defendant of the money coming to his hands, as this suit is brought not on agreement. This is not proved. The items are pointed out to us as evidence of fraudulent appropriation. Fraud is composed in several elements, misappropriation and concealment, with a dishonest intent--deceit for...