Troup v. Mechanics' Nat. Bank

• Decision Date: 05 May 1902
• Parties: TROUP v. MECHANICS' NAT. BANK.
• Court: Rhode Island Supreme Court

53 A. 122

24 R.I. 377

TROUP

v. MECHANICS' NAT. BANK.

Supreme Court of Rhode Island.

May 5, 1902.

Action by Frances E. Troup, administratrix, against the Mechanics' National Bank. Judgment for plaintiff.

Comstock & Gardner, for petitioner.

Tillinghast & Tillinghast, for defendant.

DOUGLAS, J. The facts of this case, as they are admitted or as they appear in evidence, are as follows: Augustus C. Troup, the plaintiff's intestate, carried on business in his lifetime under the name of A. C. Troup & Co., and kept a deposit in the defendant bank as A. C. Troup & Co. On December 18, 1889, he made his promissory note as A. C. Troup & Co. for the sum of $400, payable four months after date, and this note was discounted by the defendant bank, and the net proceeds thereof paid to the plaintiff's intestate. On February 19, 1900, the plaintiff's intestate died. On April 6, 1900, the plaintiff was duly appointed administratrix, qualified, and gave notice of her appointment, as required by law. At the time of the death of the plaintiff's intestate, the balance due him on the books of the defendant bank was $735.95, all checks drawn by the intestate having been paid and charged. On April 18, 1900, the bank's note came due. The bank thereupon charged the amount of said note in said account, but continued to hold the same until some time in October, 1901. On June 30, 1900, the bank sent to the plaintiff a statement of the balance due on the account, which showed that this note had been charged to the account, and the plaintiff returned to the bank a statement that the account was correct The estate of the plaintiff's intestate proved to be insolvent, and was so represented to the probate court November 9, 1900, within 30 days after expiration of the time fixed for the presentation of claims against the said estate. The defendant bank filed no claim either with the administratrix or with the clerk of the municipal court, and presented no claim to the commissioners who were appointed upon said insolvent estate. After the estate had been declared insolvent, and after the time had expired for the presentation of claims to the commissioners, the plaintiff demanded from the defendant the amount of the deposit to the credit of A. C. Troup & Co. at the time of the death of her intestate. This amount the defendant refused to pay in full, claiming the right to charge the estate, or to offset against this claim, the amount of said note.

The essential facts which raise the disputed question in this case are that the defendant bank, at the time of the death of plaintiff's intestate, held deposits belonging to him amounting to $735.95, and also were holders of a promissory note made by intestate for $400, due two months after the intestate's death; that the intestate died insolvent, and commissioners were appointed to consider claims against his estate, and that the defendant did not present the note to the commissioners for consideration. The plaintiff claims that the defendant cannot be allowed to charge the amount of the note to the account, because the note had not been presented to the commissioners as a claim against the estate. In support of this claim her counsel cite the following cases:

Ewing v. Griswold, 43 Vt. 400. This decision is based upon the statute of Vermont (Gen. St. p. 401, § 14) which provides that, if the party "does not exhibit his claim to the commissioners within the time limited by the court for that purpose, he shall be forever barred from: recovering such demand, or from pleading the same in set-off in any action whatever."

Jones v. Jones, 21 N. H. 219. This was not the case of an insolvent estate. The same court, in Mathewson v. Bank, 45 N. H. 104, under a statute similar to our own, and upon facts exactly like those presented by the case at bar, held "that no presentment of claim to the administrator has ever been required in the case of an estate represented insolvent, either for the purpose of an allowance of the claim by the commissioner or to be used as a set-off in an action by the administrator, where the setoff can be used as a matter of defense only, and not as the foundation of a recovery of any balance. The language of the Revised Statutes is confined to actions. 'No action against an administrator shall be sustained,' etc., 'unless the demand shall have been exhibited to the administrator and payment demanded.' In the case of an insolvent estate neither the proof of the claim before the commissioners nor the offer of it in setoff has been regarded as within the meaning of the term 'action.'"

Bell's Adm'r v. Andrews, 34 Ala. 538. This case holds squarely that a claim against an insolvent estate which has not been filed within the time required by law is not available as a set-off in an action brought by the administrator. The decision depends upon section 1847, Code Ala. 1852, as follows: "Every person having any claim against the estate so declared insolvent, must file the same in the office of the judge of probate within nine months after such declaration," etc., "or the same is forever barred." Our statute corresponding to this provision is Gen. Laws, c. 215, § 21, as follows: "If any creditor shall not prove his claim before the commissioners within the time of the commission as originally fixed or as thereafter extended, as aforesaid, he shall, unless other special statutory provision be made to the contrary, be forever barred of his action therefor against the executor or administrator." The Alabama statute, as construed by the court, treats the claim and the counterclaim in the disjunctive, and forever bars for all purposes the claim not duly filed. Our statute applies only to creditors, and, like the New Hampshire statute, bars the creditor's right of action only. In our jurisprudence with respect to insolvent estates the distinction...