Summary
In Suydam v. Bastedo, 40 N. J. Eq. 433, S. C. 2 Atl. Rep. 808, the liability of an executor for funds of the estate, which had been wasted by his co-executor, was based upon the fact that the executors had settled a joint final account.
Summary of this case from English v. NewellOpinion
01-14-1886
SUYDAM v. BASTEDO.
John S. Voorhees, for complainant. Charles T. Cowenhoven, for defendant Bastedo.
On final hearing on bill, answer, and proofs.
John S. Voorhees, for complainant.
Charles T. Cowenhoven, for defendant Bastedo.
VAN FLEET, V. C. The facts which give rise to this suit may be summarized as follows: By the will of Catharine Stines, deceased, her executors were directed to safely invest $2,500, and pay the interest thereofto Sarah Ann Higgins during her life, and on her death to divide the principal among her six sons. The will was admitted to probate, June 3, 1871, and letters testamentary granted thereon to the defendants, William I. Bastedo and Goyn D. McCoy. They were the persons nominated as executors in the will. The defendants filed a joint account as executors, September 10, 1872, which was afterwards, on the first day of October following, allowed and confirmed by the orphans' court of Middlesex county. The defendants charged themselves in their account with $6,240.71, and prayed allowance for $6,126.20, showing a balance in their hands of $114.51. Among the items appearing on the credit side of their account is one stated in this wise: "Specific legacy to Sarah Ann Higgins, invested in accordance with will, $2,500." This item was put down as a disbursement, and it was allowed as such, but, obviously, only for the purpose of showing what residue remained in the hands of the executors for distribution among the residuary legatees. The account shows plainly, on its face, that the executors had jointly received, and had, at the time their account was allowed and confirmed, in their joint custody, sufficient estate of their testatrix, after the payment of her debts and the expenses of the administration of her estate, to pay all the legacies given by her will, including that given to Sarah Ann Higgins and her six sons. By an order made by the orphans' court of Middlesex county on the twenty-fourth of March, 1885, the defendant Bastedo was discharged from office and his co-executor removed, and the complainant appointed administrator with the will annexed, in their place. The defendants have failed, after demand, to pay over the $2,500, and this suit is brought to compel them to do so. They have neither paid the money, nor offered to deliver and surrender to the complainant any security or evidence of indebtedness representing the $2,500. Bastedo alone defends. He says that he has never had possession of the $2,500, nor any part of it, nor has he ever had any control over it, but that it has always, since its receipt, been in the possession and under the control of his co-executor.
The fact on which Mr. Bastedo rests his claim to immunity from liability is, as a matter of law, without the least efficacy as a defense. In this state the doctrine is firmly established that where two or more executors receive the estate of their testator jointly, and afterwards file a joint account, they stand jointly liable, to the persons entitled to the estate, for all the account shows to be in their hands, no matter what may have been the fact as to the actual custody of the estate when they accounted, or what arrangements they may have subsequently made among themselves as to its custody. Laroe v. Douglass, 13 N. J. Eq. 308; Schenck v. Schenck, 16 N. J. Eq. 181. This doctrine is the natural offshoot or sequence of that salutary principle which declares that a trustee, who, by the exercise of reasonable care and diligence, can prevent the loss of the trust-estate, but who, neglecting his duty, stands by and allows his co-trustee to get possession of the trust property and to waste it, shall, as the consequence of his negligence, be answerable for the whole loss. There can be no doubt, in view of the rule, that Mr. Bastedois liable for the fund in question. It is equally clear that his liability is enforceable in this court. The jurisdiction of this court over the accounts of executors and administrators, and over suits to enforce the rights of legatees and next of kin, is now so firmly established by repeated adjudications as to be beyond dispute or doubt. Frey v. Demarest, 16 N. J. Eq. 236. In cases where the liability of the person sought to be charged rests wholly on the ground of his negligence, the orphans' court has no jurisdiction, but the appropriate remedy is a bill in equity. Duncan v. Davidson's Ex'r, 40 N. J. Eq.——.
The complainant is the proper person to sue. Sarah Ann Higgins is still alive. Under the will, she has no right to the possession of the principal of the fund, and her sons have no right to demand payment of the principal until after her death, but the complainant, by virtue of his appointment as the successor of the defendants, became entitled to receive and recover all the property and assets of the testatrix's estate, and to maintain all proper actions for the recovery of the same. Revision, 781, § 129. His right to maintain the action is clear.
The complainant is entitled to a decree, with costs.