White v. Sherman

• Decision Date: 01 November 1897
• Citation: 168 Ill. 589,48 N.E. 128
• Parties: WHITE v. SHERMAN et al.
• Court: Illinois Supreme Court

168 Ill. 589

48 N.E. 128

WHITE

v.SHERMAN et al.

Supreme Court of Illinois.

Nov. 1, 1897.

Error to appellate court, First district.

Bill by Francis T. Sherman, James H. Swan, and others against Catherine M. White. From a judgment of the appellate court (62 Ill. App. 271) modifying a decree for complainants, defendant brings error. Affirmed.

Harvey B. Hurd, for plaintiff in error.

Bayley & Webster, for defendants in error.

This is a bill filed on April 15, 1895, by James H. Swan, trustee of the trust estate created by the will of Francis C. Sherman, deceased, and by the children and grandchildrenof said testator, against the plaintiff in error, Catherine M. White, as executrix and sole legatee under the will of the late Hugh A. White, deceased, for the purpose of compelling the defendant to account for and turn over to said Swan, as such trustee, certain moneys claimed to be due from said White's estate to said trust estate. The bill seeks to recover $29,450, which Hugh A. White, as trustee of the Francis C. Sherman estate, invested in certain railroad stocks in 1888. It also seeks to recover certain sums of money which White is charged with having received as commissions on insurance effected upon the trust property. An answer was filed by Catherine M. White on April 16, 1895, to which answer a replication was filed. After the coming in of the answer the bill was amended, and by agreement the answer as originally filed was to stand as the answer to the bill as amended. On May 16, 1895, the cause was referred to a master in chancery, who took testimony and made a report. In his report the master found against the right of the complainants to recover from the estate of White the original amount paid for the stocks, upon the alleged ground that said complainants were estopped from disavowing the acts of the trustee in purchasing said stocks, but the report found that the estate of White was chargeable with the commissions on insurance premiums received by him. Objections were filed to the report before the master, and exceptions thereto were filed in the circuit court. Upon the hearing before the circuit court upon the exceptions to the master's report, the circuit court entered a decree confirming the report of the master, except that it allowed the estate of White credit for certain membership fees admitted to have been paid by White as a member of a certain underwriters' association, and except that it modified such report in certain minor particulars, not now in controversy. The decree of the circuit court found that it was the duty of Swan, as successor in trust, to receive said railroad stocks and the dividends thereon as the property of the trust estate, and directed that the plaintiff in error, Mrs. White, should indorse and deliver the same to him, as such trustee, and that he should accept the same in full satisfaction of any claims on the part of said Sherman estate by reason of the purchase of said stocks by said White. The decree also found that plaintiff in error, as executrix aforesaid, was chargeable with the amount received by White as such commissions, as above mentioned, less such amount paid by him for membership fees as aforesaid; and plaintiff was ordered to pay over to said Swan $2,596.04, being the net amount of such commissions, less membership fees, as above stated, with interest from April 27, 1894, and the further sum of $145.50, with interest from said date. Upon appeal to the appellate court the latter court affirmed that part of the decree of the circuit court relating to the commissions on insurance premiums, but in all other respects reversed the decree of the circuit court, and remanded the cause, with directions to the circuit court to enter a decree charging plaintiff in error with the $29,450 invested by said White in railroad stocks, making proper deductions for dividends received thereon, and allowing interest, with annual rests, on sums so invested, from the date of the investment, at the rate of 6 per cent. per annum until July 1, 1891, and thereafter at the rate of 5 per cent., less the deductions for all dividends received, with like interest, and with directions to order the payment by plaintiff in error to said trustee, Swan, in due course of administration, of the sum so ascertained, in addition to the sum allowed on account of insurance commissions and interest. The present appeal is prosecuted from the judgment so entered by the appellate court. While the case was pending in the appellate court, Swan, the trustee, died; and Edward H. Reed, his successor in trust, having been duly appointed by the decree of the circuit court, was made a party to this cause in the place of said Swan.

The facts necessary to an understanding of the questions involved in this cause are as follows:

Francis C. Sherman died testate on November 7, 1870, leaving, him surviving, his widow, Electa Sherman, and his three children, Francis T. Sherman, George C. Sherman, and Martha S. Marsh, his only heirs at law. The widow, Electa Sherman, has since died; and George C. Sherman, one of the sons, has also since died. The latter at the time of his death left no widow, nor any child, nor any descendant of a child. Francis T. Sherman and Martha S. Marsh are the only surviving children of said testator. Francis T. Sherman has four children, namely, Frances Ella Marsh, wife of Eben J. Marsh; Lula M. Aldrich, wife of J. Frank Aldrich; Francis C. Sherman, whose wife is Myra Sherman; and Eaton G. Sherman, a bachelor. Martha S. Marsh has two children, namely, Ida S. Charles, wife of J. Joseph Charles, and Edwin Sherman, whose wife's name is Alida W. Sherman.

The will of Francis C. Sherman, deceased, provided, among other things, as follows: ‘(3) I do give, bequeath, and devise my real estate in said city of Chicago, known as the ‘Sherman House Property,’ and described as lots seven (7) and eight (8) in block thirty-four (34) in the original town (now city) of Chicago, in said county, with the hereditaments and appurtenances, to Joshua L. Marsh, of said city, as trustee, and to his successors, forever. In trust, however, for the following uses and purposes, and upon the following conditions, namely: Upon my death, to take possession of said Sherman House property, and collect and receive all the rents, issue, and profits thereof then due or thereafter to become due, and upon the termination in any manner of the lease of any portion thereof, or upon any portion thereof becoming vacant, to rent the same to such person or persons, and upon such terms and conditions, as he may think best: provided, that no lease or demise shall be for a longer term or period than ten years. (4) I do hereby authorize said trustee to insure said property as he may think best, and in case the same, or any portion thereof, shall be injured or destroyed by fire or otherwise, to repair or rebuild the same, and for that purpose to borrow money, if by him thought advisable or necessary, upon such terms and conditions, and for such time and times, and in such amounts, as he may see fit, and to execute and deliver any and all necessary notes, bonds, mortgages, deeds of trust, or other instruments in writing, to secure the payment of the same, upon said Sherman House property, and to renew or extend the time of payment of any such loan, or again borrow money for the payment of any such loan, or any I may have made on the same, and secure the same as aforesaid. (5) After the payment of all taxes, rates, and assessments legally levied, assessed, or imposed upon said property, and all premiums for insurance, and all interest, as it matures, that may become due upon money borrowed for the purchase, improvement, rebuilding, or repairing of said property, or that may have been borrowed by me and secured on said property, * * * and all reasonable charges and expenses attending the execution of this trust, I direct my said trustee to appropriate the remainder of such rents, issues, and profits as follows: Until the indebtedness hereinbefore referred to, for the purchase, improvement, repairing, or building said property, shall have been fully paid, I direct my said trustee to pay to my said wife the sum of six thousand dollars per annum, and to each of my children living the sum of three thousand dollars per annum, all payable quarter-yearly, and the remainder to the payment of said indebtedness. After said indebtedness shall have been fully paid, I direct said trustee to pay to my said wife, while living, one-third of such remainder, and divide the remainder among my children equally, and after her death to divide the whole of such remainder among my children equally. In case of the death of any of my said children, the heirs of his or her body, if any, shall in all cases represent him or her, and be entitled to his or her share. It is my desire, and I hereby direct, that my said trustee shall have, hold, and manage said Sherman House property entire and undivided, and appropriate the rents, issues, and profits thereof in the manner hereinbefore specified, during the natural life of my said wife and children, and until the death of the last survivor of them, and until the youngest child of any and all of my said children shall become and be of the age of twenty-one years, and then convey the same to the heirs of my said children, the heirs of each child representing and being entitled to one equal share. In case of the death, resignation, refusal, or inability to act of said trustee, I hereby direct that a new trustee be appointed by the county court of said county, upon the application of any person interested, and notice to all the other persons interested, with all the powers of said original trustee; and my trustee, before entering upon the duties of his trusteeship, shall enter into a bond, with good and sufficient security, to be approved by said court, in such sum as said court may determine, payable to some one of...