Smith v. Haire

• Decision Date: 14 December 1915
• Citation: 181 S.W. 161,133 Tenn. 343
• Parties: SMITH ET AL v. HAIRE ET AL.
• Court: Tennessee Supreme Court

181 S.W. 161

133 Tenn. 343

SMITH ET AL v. HAIRE ET AL.

Supreme Court of Tennessee.

December 14, 1915

Appeal from Chancery Court, Monroe County; Foss H. Mercer Chancellor.

Suit between Joe J. Smith and others and Betty Humes Haire and others. From the decree of the Court of Civil Appeals on appeal from chancery court, defendants appeal. Reversed.

R. H Sansom and John W. Green, both of Knoxville, for appellants.

Jerome Templeton, of Knoxville, and David C. Young, of Wartburg, for appellees.

GREEN J.

This litigation arises out of the settlement of the estate of the late J. T. M. Haire, of Monroe county.

Mr Haire died, leaving a will by which he devised and bequeathed all his estate to his wife, Betty Humes Haire, absolutely. This will was contested on the ground of mental incapacity of testator and fraud and undue influence. The will was set aside and this judgment affirmed by the Court of Civil Appeals, and later by this court.

Another will of Mr. Haire's, made before the one contested, was then set up. In the former will, which was the one finally established, Mr. Haire gave his estate to his wife for life, with the remainder to certain relatives of his own.

In the controversy now before us two questions arise: First, the liability of Mr. Haire's estate for attorney's fees incurred by Mrs. Haire as executrix in the contest over the will that was set aside; and, second, whether certain certificates of deposit issued by two of the Knoxville banks payable to J. T. M. Haire or Betty Humes Haire passed under the will admitted to probate, or whether Mrs. Haire took these certificates in her own right as survivor of her husband.

In regard to attorney's fees, it is well settled in Tennessee that an executor who in good faith propounds a will for probate is entitled to his costs and attorney's fees, whether the will be set aside or not. Lassiter v. Travis, 98 Tenn. 330, 39 S.W. 226; Douglass v. Baber, 15 Lea, 665; Smith v. Harrison, 2 Heisk. 230; Bowden v. Higgs, 9 Lea, 346; Cornwell v. Cornwell, 11 Humph. 487.

In Lassiter v. Travis, supra, it appeared that the executrix of the will there contested was the principal beneficiary thereof, and, although the will was set aside, this court held she was entitled to her costs and attorney's fees out of the estate. The court said that:

"Good faith, rather than pecuniary interest, on the part of the acting executor, is the controlling question in such a case."

It does not appear from the report of Lassiter v. Travis, supra, upon what ground the will was set aside.

The will of J. T. M. Haire, of which his wife was sole beneficiary and executrix, was set aside on the ground, partly at least, of fraud and undue influence. There was evidence before the jury which this court at a former term thought sustained the jury's conclusions respecting the will. Such evidence indicated that, if Mrs. Haire herself did not resort to such means, undue and fraudulent influence was exerted over the testator by certain of her relatives in her behalf, for whose acts she must be charged with responsibility.

It cannot be said that the beneficiary of a will procured by fraud and undue influence, for which she is responsible, is acting in good faith when she attempts to have such a will set up. In such a case costs and counsel fees must be disallowed to the executrix when the will is set aside. 40 Cyc. 1362; Deleglise v. Morrisey, 142 Wis. 234, 125 N.W. 452; In re Jones, 166 Cal. 147, 778, 135 P. 293.

We do not mean to say that we will disallow such costs and attorney's fees in every case wherein a will may be set aside on the ground of fraud and undue influence, even though the executor or executrix may be the sole beneficiary. A case may arise in which the jury would find fraud and undue influence with enough evidence to require an approval of such a verdict by the court, and yet there might be in such a case circumstances that would justify the attempted probate of the will in good faith. In the case before us, however, we are satisfied with the judgment of the Court of Civil Appeals disallowing the counsel fees. That court has discussed the evidence at length, and we considered the evidence on the hearing of the will contest, and it is not necessary to go over it again.

The certificates of deposit in litigation were two in number. One was issued by the East Tennessee National Bank, of Knoxville, for $4,500. The other was issued by the Mechanics' Bank & Trust Company, of Knoxville, for $6,500. Both certificates recited a deposit by J. T. M. Haire, and were payable to the order of the said J. T. M. Haire or Betty Humes Haire.

The money represented by these certificates of deposit came from the estate of Mr. Haire. The certificate of deposit in the Mechanics' Bank & Trust Company consisted of several smaller deposits previously made by Mr. Haire in his own name. They were combined, and at the request of Mr. Haire a certificate was issued for the aggregate sum payable to himself or his wife, as before stated. The deposit in the East Tennessee National Bank was made by Mr. Haire at one time, and a certificate issued payable to himself or wife.

The evidence in the record throws little light upon Mr. Haire's intentions in having these certificates of deposit issued to the order of himself or his wife. Mrs. Haire said that he told her he had the certificates issued in this way so that she might be able to get ready money easily. Just what this means we are not able to say, nor is there any other distinct proof in the record from which we might gather the purpose of the deceased in taking the certificates out in such form.

So we must consider the legal effect of these certificates so written without any particular aid from extrinsic proof, except certain letters written by Mr. Haire to the banks.

The first question that arises is upon the meaning to be given to the conjunction "or" in the certificates. Is it to be considered as having been used in the sense of "and"? We think the word was so used.

The words are often convertible, and are frequently so treated in the construction of statutes and written instruments when good sense requires. Ransom v. Rutherford County, 123 Tenn. 1, 130 S.W. 1057, Ann. Cas. 1912B, 1356; Bird v. State, 131 Tenn. 518, 175 S.W. 554.

It was formerly held in several jurisdictions that a note payable to A. or B. was not good as a promissory note, because of the uncertainty of the payee. Blanchenhogan v. Blundell, 2 B. & Ald. 417; Carpenter v. Farnsworth, 106 Mass. 561, 8 Am. Rep. 360; Walrad v. Petrie, 4 Wend. (N. Y.) 575; Musselman v. Oakes, 19 Ill. 81, 68 Am. Dec. 583.

Other cases treated such a note as though written payable to A. and B. So read, the note would be evidence of an obligation to the payees jointly, and suit could be maintained thereon by both payees, but not by one. Willoughby v. Willoughby, 5 N. H. 244; Spaulding v. Evans, Fed. Cas. No. 13,216. This view was really approved in Walrad v. Petrie, 4 Wend. (N. Y.) 575, but the court felt bound by the cases referred to above.

This court very distinctly adopted the New Hampshire construction in the early case of Quinby v. Merritt, 11 Humph. 439. In that case a certain written obligation was indorsed to the order of C. W. or W. L. Nance. C. W. Nance alone undertook to transfer it. This court said that, while such a paper was not valid as a promissory note, "yet it is evidence of a contract for the payment of money, and according to the cases referred to, and especially that in 5 N. H., is evidence of a contract with both the payees jointly; and they have, therefore, a joint interest in the fund secured by such note." The court accordingly held that a suit could not be maintained by the indorsee C. W. Nance; that it was necessary for C. W. and W. L. Nance both to indorse the paper to effect a valid transfer.

See, also, Estate of William Parry, 188 Pa. 33, 41 A. 448, 49 L. R. A. 444, 68 Am. St. Rep. 847; Farrelly v. Emigrant Savings Bank, 92 A.D. 529, 87 N.Y.S. 54.

While subsection 5, § 8, c. 94, Acts 1899 (Negotiable Instruments Act), provides that a promissory note may now be made payable to "one or some of several payees," the statute does not undertake to define the interests of such payees in the obligation, and we do not think it invariably precludes us from construing such an obligation to be one in which the payees have a joint interest.

In the particular case before us such a construction is clearly correct.

Looking to the correspondence of Mr. Haire with the banks, when these certificates were issued, it appears beyond doubt that Mr. Haire himself used the conjunctions "or" and "and" as convertible words in arranging about these deposits. It is conceded that he had the same intention with reference to both deposits. In his correspondence with the Mechanics' Bank & Trust Company we find him requesting that certificates be issued payable to the order of himself or wife, and in two of his letters to the East Tennessee National Bank about the deposit there he requests that the certificate be issued to the order of himself and wife. Both banks made the certificates payable to Haire or his wife. We think these letters of his show conclusively that he attached no such significance to the word "or" in the certificates of deposit, as counsel for complainants ascribe to the use thereof, but, on the contrary, his letters very clearly show that he took no distinction between the words "or" and "and" in this connection, and neither did the East Tennessee National Bank.

It thus appearing to us that the certificates of deposit must be dealt with as if payable to Mr. Haire and his wife there would be little more difficulty in the case were it not for Mr. Haire's will, which has been...