Wright v. Caney River Ry. Co.
| Decision Date | 23 December 1909 |
| Citation | 66 S.E. 588,151 N.C. 529 |
| Parties | WRIGHT v. CANEY RIVER RY. CO. et al. |
| Court | North Carolina Supreme Court |
Appeal from Superior Court, Yancey County; J. S. Adams, Judge.
Action by Cornelia Wright, administratrix of Turner Wright, against the Caney River Railway Company and others. Judgment for plaintiff, and defendants appeal. No error.
As a general rule, a trust fund cannot be subjected to legal liability for the torts of the trustee or his agents or employees.
The action was instituted by Cornelia Wright, as administratrix of Turner Wright deceased, on the 1st day of August, 1907, against the Caney River Railway Company, C.J. Morrow, trustee for creditors of the Wood-Galloway Company, operating the road at the time under a sublease, and Wm. Whitmer & Sons, Incorporated original lessee of defendant road and one of the principal creditors of the Wood-Galloway Company; and there was evidence to show that on July 13, 1907, Turner Wright intestate of plaintiff, an engineer, while operating an engine in one of defendant's trains, was killed by the giving away of a defective trestle of defendant company's road, and under circumstances indicating negligence on part of defendants. Defendants answered denying that plaintiff was the duly qualified administratrix of deceased, denied that the trestle was negligently constructed, claiming that same was caused to give away by the wrongful conduct of two boys in turning a stream of water on the foundation of the trestle, and thus constituting this intervening negligence of responsible and independent agents as the proximate cause of the injury, and offered evidence in support of these allegations. Defendants contended, further, that in any event the defendant C.J. Morrow, trustee, was not responsible for the wrong in his official capacity as trustee, nor could the trust funds held by him be subjected to the claim of plaintiff. It further appeared that, by virtue of an attachment issued, there were funds of the company in control and custody of the court, available for satisfaction of the claim if it should be declared a valid charge against the trust estate.
Issues were submitted and responded to by the jury as follows Judgment on the verdict for plaintiff, and defendants excepted and appealed.
S. J. Ervin, for appellants.
Hudgins, Watson & Johnston, for appellee.
HOKE, J. (after stating the facts as above).
The defendant company was organized under a charter conferring the power of eminent domain, and the privilege of constructing tramways, railways, etc., for the transportation of passengers and freight, including logs, lumber, timber, etc., and while its chief purpose was, no doubt, to exploit certain timber lands and market the timber growing thereon, for all purposes relevant to the present inquiry it is considered and held as a "railroad," and subject to the regulations and liabilities affecting such companies, including the statute known as the fellow-servant act (Priv. Laws 1897, p. 83, c. 56; Hemphill v. Railway, 141 N.C. 487, 54 S.E. 420), and from this it follows that the defendant railway and the trustee in charge and control at the time are responsible for actionable negligence done in the operation of the road under the lease and in the exercise of the franchise (Mabry v. Railway, 139 N.C. 388, 52 S.E. 124, citing Harden v. Railroad, 129 N.C. 354, 40 S.E. 184, 55 L. R. A. 784, 85 Am. St. Rep. 747; Logan v. Railroad, 116 N.C. 940, 21 S.E. 959; Aycock v. Railroad, 89 N.C. 321). It is chiefly urged for error that the defendant C.J. Morrow, trustee, has been held liable in his official capacity, and the trust fund subjected to the payment of this claim; but we are of opinion that, on the facts presented here, the objection cannot be sustained. It is true, as a general rule, that a trust fund cannot be subjected to legal liability by reason of the torts of the trustee or his agents and employés; but this doctrine ordinarily exists in the case of passive trusts, or when active in those instances where the power and duties of the trustee are so defined and restricted by the law, or the provisions of the instrument under which he acts, that the principle of imputed responsibility similar to that which obtains in the case of principal and agent does not and cannot prevail. Thus, in McLean v. McLean, 88 N.C. 394, and several cases of like import cited and relied upon by defendants, it was held that a liability arising out of a transaction with an executor or administrator is personal in its nature, and will not, as a rule, be considered as an obligation of the estate. This is on the ground that these officers act under power conferred by the law for the purpose of settlement and distribution according to facts and conditions existent at the time of the death of the deceased, and the power to charge the estate or create liabilities against it is not recognized, unless contained in the will. Though even here if it is shown that an obligation has been assumed by an executor for the protection of the estate, and has inured to its benefit, its payment will usually be allowed him in an account with the distributees. But no such limitation can be allowed on the facts presented here. It appears that the Wood-Galloway Company, a corporation, owners of large timber interests in the counties of Mitchell and Yancey, and elsewhere, and also of large amounts of lumber placed in various yards in said counties, estimated at several millions of feet, having become embarrassed, on the 7th day of June, 1907, conveyed the same to C.J. Morrow, trustee, with power to haul out and market said lumber and dispose of the timber lands and other property conveyed, and distribute the proceeds among the creditors mentioned and described in the deed; that on the 5th day of June, 1907, two days before the date of the said deed, the Wm. Whitmer & Sons, Incorporated, one of the principal creditors of the Wood-Galloway Company, and cestuis que trust in the said deed, sublet to the trustee in same the railroad company for carrying out the purposes of the trust, and the trustee took charge of the road, and was using and operating the same in hauling out the lumber, and otherwise carrying out the purposes of the trust, when the intestate was killed. Among others, the instrument contains the following provisions:
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