United States Fidelity and Guaranty Company v. Parker

Decision Date17 February 1912
Docket Number651
Citation121 P. 531,20 Wyo. 29
PartiesUNITED STATES FIDELITY AND GUARANTY COMPANY v. PARKER
CourtWyoming Supreme Court

ERROR to the District Court, Sheridan County; HON. CARROLL H PARMELEE, Judge.

The material facts are stated in the opinion.

Affirmed.

M. B Camplin, George W. Farr, and C. R. Tisor, for plaintiff in error.

The probate law of Montana and Wyoming having been taken from California the decisions of the Supreme Court of that state are peculiarly applicable to probate proceedings in the courts of Montana and Wyoming. The questions raised in this case, it is believed, have been definitely and finally settled by the Supreme Court of California. The record of the judgment recovered in Rosebud County in Montana set forth in the petition is not binding upon the defendant surety for the reason that there has been no judgment or order in the County of Custer, wherein the guardianship proceedings are pending determining or fixing the liability or indebtedness of the principal on the bond in question, and this appears by the pleadings. Hence, until such a determination has occurred no right of action exists against the surety, and the objection of the plaintiff in error, defendant below, to the introduction of any evidence should have been sustained.

The alleged bond is insufficient in form and substance, and is not such a bond as required by the laws of Montana in force and effect now and when it was given, since it does not contain any contractual clause, and it contains nothing to impose or fix any obligation or liability on the part of the surety for the failure of the principal to account to the court in which the guardianship proceedings are pending. Again, the district court of Sheridan County in this state had no jurisdiction to try and determine this cause, and the complaint being insufficient in substance the demurrer thereto should have been sustained. The same questions were raised and urged upon the demurrer and upon the objection to the introduction of any testimony on the part of the plaintiff below. It is a well settled rule of law, and it has been so decided in California, that before any liability attaches to a surety upon a guardian's bond, and before any action can be maintained in a court of equity against the surety to enforce the payment of the penalty of any such bond, for a breach thereof by the failure of the guardian to faithfully fulfill the duties of his trust, there must first be some order or decree of the probate court in which the guardianship proceedings are pending determining and fixing the amount of the indebtedness of the guardian to the ward. That an accounting must first be had will doubtless be conceded; and it has many times been held that there is but one party with whom such an accounting can be had, viz: the guardian himself, or in case of his death, his legal representative. The surety in many instances, as in the case at bar, may be a foreign corporation without even an agent located at the place where the estate is being administered and it is not only impracticable but impossible for sureties to go into court and have an accounting in these guardianship proceedings, for they are not possessed of the means or knowledge to protect themselves against unjust claims; the guardian or his legal representative is the only person in possession of the facts necessary to make an accounting. It is the peculiar province of probate courts to administer the estate of minors as required by law. Their jurisdiction is exclusive and also limited to matters of this character. Courts of equity have no jurisdiction over probate proceedings, and it is an attempt to invade the province of the probate court when actions of this character are brought in courts of equity without the necessary legal steps having first been taken in the court of original and exclusive jurisdiction to determine and fix the basis of the action sought to be prosecuted. (Graff v. Mesmer, et al., 52 Cal. 636; Allen v. Tiffany, 53 Cal. 16; Chaquette v. Orter, 60 Cal. 594; Hudson v. Barrett, (Kan.) 61 P. 737; Reither v. Murdock, (Cal.) 67 P. 784.)

There are two modes of procedure which may be followed by wards in actions upon the guardian's bond; first, an accounting must first be had in the probate proceedings and an order obtained therein fixing the amount of the guardian's indebtedness to the ward, which may be used as the basis for an action in a court of competent jurisdiction against the sureties upon the bond to enforce payment of the penalty for a breach thereof. Second, if there has been no accounting in the probate proceedings, such as we contend there has not been in the case at bar, the proper course is for the ward to commence a suit on her bond in the district court in the county and state where the guardian was appointed against the personal representative of the guardian if he be deceased, to compel such personal representative to go into court and render an accounting in the guardianship proceedings. In such a case the surety can be made a party defendant and could participate in the accounting, and if upon such an accounting it was ascertained that the guardian was indebted to the ward judgment could be entered against the surety for the amount found to be due. This, we believe, to be an equitable rule, since the surety then participates in the accounting and has a chance to be heard; and the accounting will be had in the court having jurisdiction of the subject matter, with all the parties concerned before the court. The estates of the wards of this guardian have never been closed or settled. They are still pending in Custer County, Montana. It cannot be seriously urged that the courts of Wyoming have jurisdiction over pending probate matters in Montana. Neither can it be urged that the courts of Wyoming have jurisdiction over the estate of the deceased guardian pending in the district court of Rosebud County, Montana, or over the administratrix of such estate. If that be conceded then a district court in Wyoming can have no juristion over either the subject matter or any of the real parties in interest in this action. (Reed v. Hume, 70 P. 998; Cook v. Ceas, (Cal.) 77 P. 65.)

A suit on a bond cannot be commenced before there is a breach. The bond does not constitute the cause of action, but some breach of the bond; and if the guardian is not in default until he fails or refuses on demand to pay over the amount found due on settlement of his accounts, a final order of settlement is an essential element of the cause of action against the surety. (Nickals v. Stanley, (Cal.) 81 P. 117; Weihe v. Stratham, (Cal.) 67 Cal. 84, 7 P. 143; Ford v. Kittredge, 28 La. Ann. 113; Chapron v. Chapron, 41 La. Ann. 486; 6 So. 810; Treasurer &c. v. Hall, 2 Ohio 225; Ordinary v. McClure, (S. C.) 1 Bailey, 7; Davant v. Pope, 6 Rich. Law, 247; Terr. v. Bramble, 2 Dak. 189, 5 N.W. 945; State v. Waples, 5 Har. 257; Kempear v. Splane, 4 La. Ann. 486; Haight v. Brisbin, 100 N.Y. 219, 3 N.E. 74; Cadwallader v. Longley, 1 Disn. (Ohio) 497; Adams v. Petrain, 11 Ore. 304, 3 P. 163; Easterling v. Thompson, 1 Rice, (S. C.) 346; Buchanan v. Bilger, 64 Tex. 589; Jones v. Irvine, 23 Miss. 361; State v. Cutting, 2 O. St. 1; Probate Court v. Kimball, 42 Vt. 320; Judge &c. v. French, 3 Stew. & P. (Ala.) 263; State ex rel. Shinn v. Stafford, 73 Mo. 658; Ordinary v. Pettus, 11 Rich. Law, 543; Probate Court v. Chapin, 31 Vt. 473.)

The amended petition set forth the bond and the breach thereof, and attempted to plead facts which would entitle the plaintiff to recover from the surety for a breach by the guardian, and then alleged the judgment obtained in the district court in Rosebud County, Montana, against the administratrix of the estate of the deceased guardian, the said judgment being set out in full, and upon the trial the pleadings in that action were introduced in evidence. It seems to us that there are clearly two causes of action relied upon in the amended petition, one upon the bond and the facts pleaded to establish a breach, and one upon the judgment. The two causes of action are separate and distinct, the one depending upon the failure of the guardian to account in the proper court, and the other upon the judgment. Evidence that might be material and competent in an action based upon a breach of the bond are irrelevant and immaterial and incompetent so far as the action is brought upon the judgment, and vice versa. At the outset the plaintiff in error moved that the defendant in error be required to elect upon which cause of action she relied. The court denied that motion, and testimony was introduced to show the property that had come into the hands of the guardian, the disposition made of it and its value at the time he took possession of it and when the guardianship terminated, and the court attempted to determine in this action the amount of the guardian's indebtedness to the ward, to thereby establish the liability of the surety. Testimony was also introduced fully covering the judgment recovered against the administratrix. The evidence was all duly objected to and the ruling of the court thereon excepted to. In this particular there is certainly reversible error.

As above stated the bond contains no contractual clause. There is nothing contained in it which attempts in any manner to impose an obligation or fix a liability upon the surety for the failure of the guardian to faithfully discharge the duties of his trust. The action was barred by the statute of limitations. It should have been commenced within three years after the termination of the guardianship. The guardianship was terminated when the ward attained her majority, and all relations between the guardian and ward thereafter were contractual. When the guardianship...

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