Opinion · Supreme Court of North Carolina

Stack v. . Williams

56 N.C. 13

Type: Opinion
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Date: 1856-12-05
Topic: general

Battle, J. An executor or administrator who parts with all the assets of his testator or intestate by the payment of legacies, or by a distribution among the next of kin, without taking refunding bonds, and afterwards is compelled to pay an outstanding debt out of his own funds, is not entitled, as a matter of course, to relief in Equity. It is his duty to keep regular accounts, and to retain the assets, or at least a sufficiency of them, in his hands, until all the known or apprehend *15 ed debts are paid, and, even then, to take from the legatees, or next of kin, to whom be delivers over the residue of the assets, refunding bonds, for the benefit of such creditors as may still have valid claims against the estate. Rev. Code, ch. 46, sec. 24.

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STACKv. WILLIAMS,56 N.C. 13(1856)

AMOS STACKand another, administrators ofABEL STACK,against

J. WILLIAMSand others.

Supreme Court of North Carolina

(December Term, 1856.)

Where an administrator was compelled by a judgment of Court to pay over the assets in his hands to the next of kin, not being aware, at the time such judgment was entered against him, of an outstanding claim upon the assets, which he was compelled afterwards to discharge out of his own funds, a Court of Equity will relieve him, although he took no refunding bond.

CAUSE removed from the Court of Equity of Union County.

Abram Williams, the intestate of the plaintiffs' intestate, conveyed in fee simple by deed of bargain and sale, a tract of land lying in Chesterfield District, in the State of South Carolina, to one Christopher Dees, with a covenant of quiet enjoyment. Afterwards, certain parties in the State of South Carolina, set up title to a part of the premises so conveyed, and instituted an action in that State against the said Dees for the recovery of the same. Previously to the institution of this suit, having received information that it would be brought, the plaintiffs' intestate applied to Williams to defend the same, and, as he alleges in his bill, he, Williams, agreed that, if Dees would defend the action, he would indemnify him against all costs and expenses which he might incur in so doing. Dees did make a defense to the action, which was afterwards brought in the South Carolina Court, where it pended for several years, and was not determined until after the death of Williams, when a recovery was had therein against him for $259,31. Dees then brought suit in Union Superior Court against Abel Stack, the administrator of Williams, not only for the amount recovered, but for other large sums laid out and expended in making defense to this action in South Carolina, in all of which he averred that he had promised to indemnify and save him harmless. Stack, the defendant in this action, suffered a judgment by default to be entered against him, which was afterwards executed, and damages to the amount of $528,20 were assessed against him.Page 14

Before the commencement of this suit against the administrator, Abel Stack, he had settled with the next of kin of his intestate, and, under a judgment against him to that effect, had paid over all the assets in his hands to the guardian of these distributees, they being infants, so that he was obliged to pay the whole of this recovery out of his own funds.

The bill alleges that, because of the infancy of the defendants, and because of his not apprehending any such claim against the estate, the plaintiffs' intestate took no refunding bond.

The defendants are the heirs-at-law, and the next of kin, of the intestate, Williams, and the prayer of the bill is, that, out of the estate of the said Williams in their hands, they refund to him what he has been compelled to pay. After this suit was brought by Abel Stack, he died, and the present plaintiffs, as his administrators, were made parties.

The defendants insist that it was the duty of their father's administrator, Stack, to have resisted the recovery made by Dees in the Superior Court of Union County, and that by permitting a judgment by default to be entered against him, he showed that he was acting in collusion with the plaintiff Dees.

There were replication and commissions. Proofs were taken; and the cause being set down for hearing, was sent to this Court by consent of parties.

WilsonandJones, for plaintiffs.Ashe, for defendants.

BATTLE, J.

An executor or administrator who parts with all the assets of his testator or intestate by the payment of legacies, or by a distribution among the next of kin, without taking refunding bonds, and afterwards is compelled to pay an outstanding debt out of his own funds, is not entitled, as a matter of course, to relief in Equity. It is his duty to keep regular accounts, and to retain the assets, or at least a sufficiency of them, in his hands, until all the known or apprehendedPage 15debts are paid, and, even then, to take from the legatees, or next of kin, to whom he delivers over the residue of the assets, refunding bonds, for the benefit of such creditors as may still have valid claims against the estate. Rev. Code, ch. 46, sec. 24. To give relief to persons who have failed to perform their duty in these respects, would be to encourage such neglect, and to beget carelessness in the management of dead men's estates.Alexanderv.Fox, 2 Jones' Eq. Rep. 106. But there are cases which form an exception to the general rule, and which, from their peculiar circumstances, will entitle the executor or administrator to call upon the legatees, or next of kin, by a suit in this Court, to refund. If debts be afterwards made to appear, or liabilities to exist, of which he had no notice, and could not have had any reasonable expectation, when he parted with the assets, or, if without any fault on his part, the assets retained for the payment of debts have been lost or destroyed, these matters, arising subsequently to his settlement with the legatees or next of kin, may entitle him to this relief.Marshv.Scarboro, 2 Dev. Eq. Rep. 551.

The present case falls manifestly within the principle of one of the exceptions. The plaintiffs' intestate was compelled by a judgment, to settle with, and pay over to, the next of kin of his intestate, Abram Williams, all the assets in his hands. A suit was instituted about this time in another State, against the vendee of his intestate, for a part of a tract of land, which the latter had sold, and a recovery was had therein two or three years afterwards. The vendee then sued the administrator in this State, upon a promise made by his intestate, that if the vendee would defend the suit in South Carolina, he would pay all the costs and charges to which he might be subjected on account thereof. This latter suit was suffered to go by default, and, upon an enquiry of damages, the plaintiff therein recovered the amount which the administrator paid, and his representatives now seek to recover from the next of kin by the present suit. In the deed from the intestate, Williams, there was a covenant of quiet enjoyment, upon which his administrator was undoubtedly liable, and asPage 16it does not appear, from the proofs, that he had notice of that liability at the time when he settled with the next of kin, or rather at the time when he had an opportunity to defend their suit against him, he has a clear equity to have a decree for the amount recovered against his intestate's vendee in South Carolina.

But in the suit against the administrator in this State, which he permitted to go by default, by omitting to plead to it, a much greater sum was recovered against him. That recovery is alleged by the defendants in their answer, to have been collusive, but they have not furnished us with any sufficient proof of it. The judgment against the administrator, however, is not evidence against them, except as to its amount, because they were not parties to the suit. The burden of the proof, then, is upon his representatives, to show that the recovery was proper. This they have not done by the proofs now on file, except as to the amount recovered against the vendee in South Carolina. There is, indeed, some testimony tending to show, that the intestate, Williams, had made a parol engagement to be responsible for something more than what he was liable for on his covenant of quiet enjoyment. We are not satisfied, however, from that testimony, that the damages recovered of the administrator, were just and proper, and his not pleading to the action, creates some suspicion against him. Under these circumstances, we think a further enquiry ought to be made by a commissioner of this Court, to ascertain, as nearly as he can, what is the true amount for which the plaintiffs' intestate was liable, as the administrator of Williams, upon the contract made by Williams with his vendee, relative to the defense of the suit in South Carolina. An order may be drawn for that purpose; and the cause will be retained for further directions upon the coming in of the report of the commissioner.

PER CURIAM. Decree accordingly.Page 17