Wilkins v. Deal
| Decision Date | 11 December 1934 |
| Docket Number | 29031 |
| Citation | 257 N.W. 486,128 Neb. 78 |
| Parties | EARL H. WILKINS, GUARDIAN, APPELLEE, v. MARY E. DEAL ET AL., APPELLANTS |
| Court | Nebraska Supreme Court |
APPEAL from the district court for Fillmore county: ROBERT M PROUDFIT, JUDGE. Affirmed.
AFFIRMED.
Syllabus by the Court.
1. A guardian has no authority to sell personal property or invest the funds of the ward's estate without proper order of the county court.
2. Where a county court directed a guardian to give another bond because of the insolvency of the surety on a prior bond, and the guardian in compliance therewith procures a new bond, but no accounting was then had nor order of the court releasing the prior bond, the later bond is an additional and not a substitute bond .
3. In such case, where the later bond is conditioned, as required by statute (Comp. St. 1929, § 38-110), the surety on such bond is liable for defalcation of the guardian whether the devastavit occurred before or after the bond was given.
4. The county court has exclusive jurisdiction to determine the state of accounts between the guardian and ward, and no action can be maintained upon a guardian's bond until the amount to be due from the guardian is first ascertained on the settlement of the guardian's final account by the county court. Langdon v. Langdon, 104 Neb. 619, 178 N.W. 178.
5. The order and decree of the county court as to the amount due from the guardian to his ward upon the final accounting and settlement of the guardian is final and conclusive upon the sureties on the bond. Hughes v. Langdon, 111 Neb 508, 196 N.W. 915, 199 N.W. 832.
6. A guardian and surety on his bond are liable for the amount of funds of the ward which the guardian has invested without proper authority of the county court.
7. The duty devolves upon the subsequent surety to ascertain the condition of the ward's estate before binding himself as surety on the bond.
8. Where there are two sureties of a guardian given at different times, both are answerable for breaches committed prior to the execution of the second bond.
9. The surety on the bond of a guardian, which provides that the guardian shall dispose of and manage the ward's estate and effects according to law and for the best interests of the ward, and shall faithfully discharge her trust as guardian, and at the expiration of her trust shall settle her accounts with the court and pay over and deliver all the estate in her hands or due from her on such settlement to the person or persons who shall be entitled thereto, is liable for the amount of a fund of a ward's estate which the guardian invested in stocks of a corporation without the authority of the county court, even though such investment was made before the bond was given.
Appeal from District Court, Fillmore County; Proudfit, Judge.
Action by Earl H. Wilkins, as guardian of George T. Price, incompetent, against Mary E. Deal, Detroit Fidelity & Surety Company, and another. Judgment for plaintiff, and the last-named defendant alone appeals.
Affirmed.
Lester L. Dunn and Woods, Woods & Aitken, for appellants.
Sloans, Keenan & Corbitt, contra.
Heard before GOSS, C. J., ROSE, GOOD, EBERLY, DAY and PAINE, JJ., and RAPER, District Judge.
Earl H. Wilkins, as guardian of George T. Price, incompetent, brought this action to recover on two guardian's bonds executed by Mary E. Deal, former guardian of George T. Price, incompetent, and her sureties. One of the bonds was given by Detroit Fidelity & Surety Company and the other by the Southern Surety Company of New York. The Southern Surety Company defaulted; issues were joined. Trial was had to the court without a jury, and judgment rendered against all three of the defendants in the sum of $ 11,665.67, from which Detroit Fidelity & Surety Company alone appeals.
The defendant Mary E. Deal was duly appointed guardian of George T. Price, incompetent, by the county court of Fillmore county, on April 4, 1930, and received the sum of $ 11,217.54 belonging to said estate from a former guardian whom she succeeded. Mary E. Deal qualified with a bond given by the United States Fidelity & Guaranty Company. On June 4, 1931, the surety on the bond was released and a new bond given, June 4, 1931, by the Southern Surety Company, which bond is conditioned as required by section 38-110, Comp. St. 1929, and also contained a clause which recites that it was substituted for a former bond of said guardian and is to be in force and take effect from and after April 20, 1931. Some time in 1932, the county judge was informed that the Southern Surety Company had been placed in receivership, and he told Mary E. Deal that she must furnish another bond. In a very few days thereafter, a man from Woods Brothers (either Mr. Aldrich or Mr. Adams) appeared and tendered the bond for $ 12,000 of the Detroit Fidelity & Surety Company, on which this suit is brought, which bond was duly approved May 17, 1932, and is conditioned as required by section 38-110, Comp. St. 1929. The guardian made no report to the county court at that time.
On March 22, 1932, the supreme court of New York county, New York, placed the Southern Surety Company in the control of the superintendent of insurance, for liquidation, and enjoined the officers and agents of the company from transacting any further business.
The county court in July, 1932, cited the guardian to appear on August 12, 1932, and show cause why she should not be removed as guardian, and to render her account and to show by what authority she invested the ward's funds in an unauthorized investment. This citation was duly served on the guardian and on August 17, 1932, she filed her report which showed that she had invested $ 11,000 of the ward's funds in 110 shares of the preferred stock of Woods Brothers Corporation. No notice was served on the Detroit Fidelity & Surety Company. The hearing by agreement was continued until August 17, at which time the guardian answered alleging that she had on file a sufficient surety bond executed by the Detroit Fidelity & Surety Company, and that up to the present time (August 17, 1932), the ward had not suffered any loss as a result of the investment she had made. A hearing was had on the last named date at which the guardian was present with counsel and the court took the cause under advisement until September 15, 1932, at which time the court found and decreed that the guardian had made an improper and unauthorized investment of $ 11,000 in 110 shares of the Woods Brothers Corporation, and that the guardian has failed to restore said funds for the benefit of the ward, and that the guardian also has on hand the sum of $ 145.55 in cash or its equivalent, and she was discharged as guardian and Earl H. Wilkins appointed in her stead, and the court decreed there was due from Mary E. Deal as guardian $ 11,145.55, which she was directed to pay over to her successor.
Woods Brothers Corporation was the agent and furnished the bonds for all three of the companies who became sureties for the guardian. Before the time the Southern Surety Company gave its bond, Mrs. Deal had purchased the 110 shares of Woods Brothers Corporation stock and, when the United States Fidelity & Guaranty Company was discharged, she signed them back to the Woods Brothers Corporation and brought to the court a draft for the $ 11,000 in lieu of the stock, and the next day, June 5, 1931, she reinvested the $ 11,000 in the same or like bonds. She then placed the bonds in a safety deposit box in the First Trust Company where they have since remained. Mrs. Deal testified that, while she has the keys to the safety deposit box, a Mr. Adams, who is an officer or employee in the surety department of the Woods Brothers Corporation, has joint control with her of the bonds as agent of the bonding company. She did not tender the stock nor the $ 145.55.
No appeal was taken from the order of the county court of date September 15, 1932.
Claim has been filed against the Southern Surety Company's receiver or proper officer in New York for the amount of the...
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