State v. Doud

• Decision Date: 03 March 1925
• Docket Number: No. 18836.,18836.
• Citation: 269 S.W. 923
• Parties: STATE, to Use of ENYART, v. DOUD et al.
• Court: Missouri Court of Appeals

269 S.W. 923

STATE, to Use of ENYART, v. DOUD et al.

No. 18836.

St. Louis Court of Appeals. Missouri.

March 3, 1925.

Error to St. Louis Circuit Court; J. Hugo Grimm, Judge.

Action by the State of Missouri, to the use of Margaret Enyart, against Menzer F. Doud and another. Judgment for plaintiff, and defendants bring error. Affirmed.

W. H. Douglass, of St. Louis, for plaintiffs in error.

Kinealy & Kinealy, of St. Louis, for defendant in error.

SUTTON, C.

This action is upon the bond of the administrator de bonis non cum testamento annexo of the estate of Sarah Aim Lockett, deceased. M. F. Doud is the administrator, and the Fidelity & Deposit Company of Maryland is surety on the bond. The bond is in statutory form and is in the penal sum of $3,000. Sarah Ann Lockett died testate in the city of St. Louis March 6, 1914, seized and possessed of an undivided one-half part of certain real estate situate in said city. This she bequeathed to her four children, Joseph H. Lockett, John A. Lockett, Grace H. Lockett, and Julia Ann Lockett, in equal shares. On September 14, 1915, the probate court of the city of St. Louis ordered the administrator to sell this real estate for the payment of the debts of the deceased. On February 21, 1916, Julia Ann Lockett borrowed $550 from Margaret Enyart, and executed her note therefor, and to secure this note executed a deed of trust upon her undivided one-eighth part of said real estate. At the time the money was borrowed, the administrator was informed of the fact and of the execution of the deed of trust to secure the loan. The deed of trust was recorded in the office of the recorder of deeds of the city of St. Louis on the day it was executed. Afterwards, the administrator in compliance with the order of the probate court, sold the real estate for the payment of debts and received therefor $16,000. This sale was reported to the probate court on April 1, 1916. The sale was thereupon approved by the court and deed was made accordingly to the purchaser. Out of the proceeds of the sale, the administrator paid the debts of the estate, and after payment of such debts there remained in his hands a surplus of the proceeds of the sale to the amount of $9,569.26. Afterwards, the note secured by the deed of trust having matured, it was presented, together with the deed of trust, to the administrator, and payment thereof requested on behalf of Mrs. Enyart. At the same time, there was presented to him an order signed by Miss Lockett directing him to pay the note and charge the amount so paid against her share of the funds in his hands. There was also indorsed on the back of the note, at the time it was presented to the administrator, an order signed by Miss Lockett, directing him to pay the note, with interest, out of her share of the funds, and stating that the note marked paid by him should operate as a receipt fog the amount So paid. Miss Lockett was also present at the time the note was presented to the administrator and requested him to pay the same out of her share of the funds. The administrator declined to pay the note.

Afterwards, pursuant to an order of distribution made by the probate court on September 26, 1918, the administrator paid to Miss Lockett her entire one-fourth share of such surplus. On July 3, 1916, the administrator filed in the probate court his final settlement of the estate. Exceptions were filed to this settlement and it was continued. The administrator was appointed on January 22, 1915, and gave bond in the sum of $500 with the American Surety Company as security. On July 11, 1921, pursuant to an order of the probate court requiring the administrator to give an additional bond, the bond sued on was given. In April, 1922, Mrs. Enyart again exhibited to the administrator her note and mortgage and demanded of him the payment thereof. Payment was refused, and thereupon this suit was brought.

The cause was tried before the court without a jury. The court gave judgment in favor of the plaintiff and against both defendants for $3,000, the penal sum of the bond, to be satisfied upon the payment of $890.60, with interest. The defendants bring the cause here by writ of error.

Defendants insist that under the `Law no lien attached to the surplus funds arising from the sale of the real estate for the payment of debts in favor of Mrs. Enyart by virtue of the deed of trust given by Miss Lockett upon her undivided share of the real estate; that Mrs. Enyart had no right, title, or interest in or to said funds; that the administrator was under no obligation or duty to pay the note secured by the deed of trust out of said funds; that the failure of the administrator to pay the note did not amount to a breach of his bond; and that, therefore, the judgment of the court below should be reversed.

It is well-settled law that, when a person dies the owner of real estate, the title to such real estate passes to and vests in the heir or devisee eo instante, subject to the right of the administrator or executor to sell the same for the payment of the debts of the decedent. If the real estate is sold by order of the probate court for the payment of the debts of the decedent, any surplus of the proceeds of the sale remaining after payment of the debts goes to the heir or devisee, and if the heir or devisee has conveyed the real estate the surplus belongs to her grantee. In other words, when real estate is converted into money for the payment of the debts of the decedent, the surplus of the proceeds of the sale remaining, after payment of the debts, retains the character of real estate for the purpose of succession or distribution, and goes to the the person in whom the title to the real estate was vested when it was converted. In this case, Miss Lockett by her deed of trust conveyed to the trustee therein named her undivided share of the real estate devised to her. The conveyance was made in trust to secure the payment of her note. When the land was sold for the payment of debts, her share of the surplus, arising from the sale not needed for payment of the debts, in equity belonged to the beneficiary in the deed of trust to the amount of the note secured thereby. The administrator received this surplus in his capacity as administrator, and held it in trust for those to whom belonged. The share of Miss Lockett, to the amount of the note secured by the deed of trust, he held in trust for the beneficiary in the deed of trust. It was his plain duty to pay over to her out of this surplus the amount necessary to discharge the note. His failure to do so was a breach of his trust, for which he and the surety on his bond are liable. Grant v. Hathaway, 215 Mo. 141, loc. cit. 147, 114 S. W. 609, 15 Ann. Cas. 567; Jewell v. Knettle, 39 Mo. App. 262, loc. cit. 264; Woerner's American Law of Administration, vol. 2 (2d Ed.) p. 1344; In re Motier's Est., 7 Mo. App. 514, loc. cit. 517; Sears v. Burnham, 17 N. Y. 445; Fiscus v. Moore, 121 Ind. 547, 23 N. E. 362, 7 L. R. A. 235, loc. cit. 238; Dix v. Morris, 66 Mo. 514; Hill v. Chouteau, 1 Mo. 731; Wenzel v. O'Neal (Mo. Sup.), 222 S. W. 392, loc. cit. 395; Reid v. Mullins, 43 Mo. 306; State v. Dickson, 213 Mo. 66, loc. cit. 90, 111 S. W. 817; Hopkins v. Thompson, 73 Mo. App. 401; 24 C. J. 706; Strawbridge v. Clark, 52 Mo. 21; Helweg v. Heitcamp, 20 Mo. 569; Foster v. Potter, 37 Mo. 525, loc. cit. 534; Traders' Bank v. Dennis' Est. (Mo. App.), 221 S. W. 796.

It is urged in argument that since the deed of trust in question was not given until after the order of sale was made by the probate court, the deed of trust therefore conveyed no title. We cannot agree to this view. The order of sale did not divest the devisee of her title. This was not effectuated until the sale was made and approved, and the deed executed and delivered.

Defendants further insist that the order of distribution made by the probate court is a final judgment, and that the administrator was required to pay the money in accordance with the order, unless the funds were arrested or reached under some process of law before he had paid the funds to the devisee under the order. This view is untenable. The probate court was without jurisdiction to determine the right or title to the funds as between the devisee and the beneficiary in the deed of trust. The order of distribution does not conclude the beneficiary, and it affords the administrator no protection for the wrongful disbursement of the funds belonging to the beneficiary, and for his wrongful failure to pay over the same to her. No legal or equitable proceeding was required on the part of the beneficiary to...