The Farmers State Bank of Kingman and Charles W. Johnson v. Callahan

• Decision Date: 03 November 1928
• Docket Number: 28,265
• Citation: 271 P. 299,126 Kan. 729
• Parties: THE FARMERS STATE BANK OF KINGMAN and CHARLES W. JOHNSON, as Receiver, etc., Appellees, v. DAN F. CALLAHAN, as Administrator, etc., Appellant
• Court: Kansas Supreme Court

271 P. 299

126 Kan. 729

THE FARMERS STATE BANK OF KINGMAN and CHARLES W. JOHNSON, as Receiver, etc., Appellees, v. DAN F. CALLAHAN, as Administrator, etc., Appellant

No. 28,265

Supreme Court of Kansas

November 3, 1928

Decided July, 1928.

Appeal from Kingman district court; GEORGE L. HAY, judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

EXECUTORS AND ADMINISTRATORS--Sale of Real Estate--Stockholder's Liability Accruing After Death as Debt. After death of the owner of shares of bank stock, and before her estate was settled, the bank failed, and a shareholder's liability was established by judgment against the administrator of the decedent's estate, in his representative capacity. Subsequently the probate court, on due application, issued an order for sale of real estate owned by the deceased in her lifetime, to satisfy the judgment. The order was made pursuant to the statute providing for sale of real estate of a deceased person to pay his debts. Held, the real estate was subject to sale to satisfy the judgment.

John McKenna and Charles C. Calkin, both of Kingman, for the appellant.

Clark A. Wallace and Paul R. Wunsch, both of Kingman, for the appellees.

OPINION

BURCH J.:

The administrator of an estate appeals from a judgment of the district court affirming an order of the probate court directing him to sell real estate which belonged to the decedent at the time of her death, to pay a judgment establishing against the administrator a stockholder's liability attaching to bank stock owned by the decedent at the time of her death.

The proceeding to sell real estate was a sequel to the judgment affirmed in the case of Farmers' State Bank v. Callahan, 123 Kan. 638, 256 P. 961. To the facts stated in the former opinion nothing need be added except that at the time of her death Ora J. Callahan owned the real estate described in the probate court's order, and that final settlement of her estate had not been made when the proceeding to appropriate the real estate to satisfaction of the judgment was commenced.

The statute relating to decedents' estates provides that, subject to certain reservations not material here, the real estate and personal effects of an intestate "not necessary for the payment of debts" shall be distributed to heirs. (R. S. 22-101.) For the purpose of settling the estate, the administrator takes title to personal effects. Real estate descends to heirs, but descends to heirs subject to power of the administrator to sell real estate to pay debts. The statute further provides:

"As soon as the executor or administrator shall ascertain that the personal estate in his hands will be insufficient to pay all the debts of the deceased and the charges of administering the estate, he shall apply to the probate court for authority to sell the real estate of the deceased, or any interest he may have in any real estate situated within this state subject to the payment of debts." (R. S. 22-801.)

Appellant contends there was no debt of the deceased for which, in the admitted absence of personal assets, the real estate could be sold.

Originally, "debt" was a common-law term having a technical signification fixed by procedure:

"The legal acceptation of debt is, a sum of money due by certain and express agreement: . . . where the quantity is fixed and specific, and does not depend upon any subsequent valuation to settle it. . . . Actions of debt are now seldom brought but upon special contracts under seal; wherein the sum due is clearly and precisely expressed; for, in case of such an action upon a simple contract, the plaintiff labors under two difficulties. First, the defendant has here the same advantage as in an action of detinue, that of waging his law, or purging himself of the debt by oath, if he thinks proper. Secondly, in an action of debt the plaintiff must prove the whole debt he claims, or recover nothing at all. . . . If, therefore, I bring an action of debt for 30 l., I am not at liberty to prove a debt of 20 l. and recover a verdict thereon; any more than if I bring an action of detinue for a horse, I can thereby recover an ox. For I fail in the proof of that contract, which my action or complaint has alleged to be specific, express and determinate." (3 Blackstone's Comm. 154, 155.)

As the tight form of action of debt fell into disuse, the meaning of the term expanded:

"Debt is a sum of money due by certain and express agreement; in a less technical sense, it is any claim for money; and in a still more enlarged sense, it is any kind of a just demand. Debt is also used to signify an action of debt, which is a remedy for the recovery of a debt eo nomine and in numero, . . ." (3 Bouvier's Bacon's Abridgment, 82.)

The approved usage is given in Webster's New International Dictionary:

Debt: "That which is due from one person to another, whether money, goods, or services; that which one person is bound to pay to another, or to perform for his benefit; thing owed; obligation; liability." (p. 576.)

The term was not used in the statute relating to decedents' estates in the primary common-law sense, and it had no peculiar signification which precluded interpretation according to context and approved usage. (R. S. 77-201 second.) Broad meanings of the term were recognized in the cases of Henley v. Myers, 76 Kan. 723, 93 P. 168, 173, and Abernathy v. Loftus, 95 Kan. 87, 147 P. 818. In the opinion in the Abernathy case appears a quotation from the opinion in the case of Carver v. Braintree Mfg. Co., 2 Story (U. S. C. C.) 432, which justifies use of the phrase "liability incurred" as the equivalent of "debt contracted." There is no difficulty, therefore, in holding that any obligation originating with a person who afterwards dies, which should be discharged by appropriation of assets of his estate, is a debt. Furthermore, while the liability of a shareholder is imposed by statute, ...