Virginia Surety Co. v. Hilton
| Decision Date | 11 October 1943 |
| Docket Number | Record No. 2716. |
| Citation | 181 Va. 952 |
| Court | Virginia Supreme Court |
| Parties | VIRGINIA SURETY COMPANY, INC. v. L. N. HILTON. |
Present, Campbell, C.J., and Hudgins, Gregory, Browning, Eggleston and Spratley, JJ.
1. APPEAL AND ERROR — Assignments of Error — Consideration of Issues after Waiver. — The fact that assignments of error have been expressly waived by counsel, alone, renders it unnecessary for the Supreme Court of Appeals to discuss or decide the issues raised by them.
2. EXECUTORS AND ADMINISTRATORS — Insolvent Estates — Interest on Claims. — Interest on claims against an estate ceases where the estate is insolvent.
3. EXECUTORS AND ADMINISTRATORS — Action on Bond — Failure to Collect Entire Purchase Price for Goods Sold — Case at Bar. — In the instant case, a suit by a creditor of an estate against the administrator and the surety on the latter's bond, complainant alleged that the administrator had been guilty of a breach of trust and had squandered the assets of the estate. The administrator sold the goods of the decedent on credit to a solvent purchaser who supplied indorsers who were also solvent at the time of the sale. The purchaser and indorsers on his notes became insolvent after the sale and some of the notes could not be collected. The decree of the trial court held that the estate was solvent, that the administrator had squandered the assets, and awarded an amount against the administrator and the surety, including interest and attorney's fee, which was in excess of the value of the entire assets of the estate. The record showed that the estate was, in fact, insolvent at the time of the entry of the decree and had been for several years prior thereto. There was no evidence which diclosed any neglect or dereliction on the part of the administrator relating to his management or control of the assets of the estate.
Held: That the decree was not supported by the evidence.
4. EXECUTORS AND ADMINISTRATORS — Liability on Bond — Failure to Collect Entire Purchase Price from Purchaser of Goods on Credit. — The fact that an administrator, who sold the goods of his decedent on credit to a solvent purchaser, failed in his efforts to collect the entire purchase price, without more, is not sufficient to declare him guilty of a breach of his fiduciary duties so as to charge the amount he failed to collect against the surety on his bond.
5. EXECUTORS AND ADMINISTRATORS — Collection of Assets — Liability under Code Section 5406. — Under section 5406 of the Code of 1942, an administrator is only chargeable with money he fails to collect through his negligence or other improper conduct.
6. EXECUTORS AND ADMINISTRATORS — Collection of Assets — Obligation to Sue Where Debtor Unable to Pay. — An administrator is not required to sue for a debt due the estate when it is apparent that the debtor is unable to pay.
7. EXECUTORS AND ADMINISTRATORS — Insolvent Estates — Circumstances Entitling Creditor to Pro Rata Share Only — Case at Bar. — In the instant case, a suit by a creditor of an estate against the administrator and the surety on the latter's bond, complainant alleged that the administrator had been guilty of a breach of trust and had squandered the assets of the estate. The administrator sold the goods of the decedent on credit to a solvent purchaser who supplied indorsers who were also solvent at the time of the sale. The purchaser and indorsers on his notes became insolvent after the sale and some of the notes could not be collected. The decree of the trial court held that the estate was solvent, that the administrator had squandered the assets, and awarded an amount against the administrator and the surety, including interest and attorney's fee, which was in excess of the value of the entire assets of the estate. The record showed that the estate was, in fact, insolvent at the time of the entry of the decree and had been for several years prior thereto. There was no evidence which disclosed any neglect or dereliction on the part of the administrator relating to his management or control of the assets of the estate.
Held: That complainant was entitled only to his pro rata share of the proceeds of the estate as a general creditor under sections 5390 and 5391 of the Code of 1942.
8. EXECUTORS AND ADMINISTRATORS — Insolvent Estates — Right of Creditor to Interest and Attorney's Fees — Case at Bar. — In the instant case, a suit by a creditor of an estate against the administrator and the surety on the latter's bond, complainant alleged that the administrator had been guilty of a breach of trust and had squandered the assets of the estate. The administrator sold the goods of the decedent on credit to a solvent purchaser who supplied indorsers who were also solvent at the time of the sale. The purchaser and indorsers on his notes became insolvent after the sale and some of the notes could not be collected. The decree of the trial court held that the estate was solvent, that the administrator had squandered the assets, and awarded an amount against the administrator and the surety, including interest and attorney's fee, which was in excess of the value of the entire assets of the estate. The record showed that the estate was, in fact, insolvent at the time of the entry of the decree and had been for several years prior thereto. There was no evidence which disclosed any neglect or dereliction on the part of the administrator relating to his management or control of the assets of the estate.
Held: That complainant was not entitled to interest after insolvency, which was shown to exist at the death of the intestate, or to attorney's fees which were provided in the notes because the notes were not placed in the hands of an attorney for collection prior to insolvency.
9. EXECUTORS AND ADMINISTRATORS — Insolvent Estates — Amount of Share to Be Awarded to Creditor — Case at Bar. — In the instant case, a suit by a creditor of an estate against the administrator and the surety on the latter's bond, complainant alleged that the administrator had been guilty of a breach of trust and had squandered the assets of the estate. The administrator sold the goods of the decedent on credit to a solvent purchaser who supplied indorsers who were also solvent at the time of the sale. The purchaser and indorsers on his notes became insolvent after the sale and some of the notes could not be collected. The decree of the trial court held that the estate was solvent, that the administrator had squandered the assets, and awarded an amount against the administrator and the surety, including interest and attorney's fee, which was in excess of the value of the entire assets of the estate. The record showed that the estate was, in fact, insolvent at the time of the entry of the decree and had been for several years prior thereto. There was no evidence which disclosed any neglect or dereliction on the part of the administrator relating to his management or control of the assets of the estate. It was conceded by the surety that the administrator had, after the payment of the cost of administration and after the payment of the preferred debts, 41 per cent of the amount due the general creditors.
Held: That a final decree would be rendered by the Supreme Court of Appeals against the surety and in favor of the creditor for 41 per cent of his total claim, less the admitted amount already paid him by the administrator, the amount to bear interest from the date of the entry of the decree.
Appeal from a decree of the Circuit Court of Dickenson county. Hon. Alfred A. Skeen, judge presiding.
The opinion states the case.
Willis & Willis and R. E. Williams, for the appellant.
S. H. & George C. Sutherland, for the appellee.
J. H. Amburgey died intestate in June, 1936, leaving surviving him his widow and five children of whom three were minors. His son, B. H. Amburgey, qualified as administrator of the estate and gave bond for $3,000 with the Virginia Surety Company, Inc., as surety.
The estate consisted of a stock of merchandise which was...
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