Case ID: sc-eq_20/html/0170-01.html
Source: Caselaw Access Project
Author: {"author": "Johnston, Ch.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

L. P. Hext et al. v. Mary Porcher, adm'x of James Porcher.
    
    The liability of a trustee is not measured by the abstract rule of his duty. The universal test of his liability, or exemption from liability, is this: is there, or i» there not, in this case, evidence of faithful endeavors to fulfil it t
    To take advantage of a mistake, committed in an evidently honest endeavor, by the trustee, to perform his duty, and to make him liable for the consequences, would neither square with the dictates of justice, nor promote the true policy of the Court, or tire interest of its sanctions.
    
      Before Johnston, Ch. at Gillisonville, February, 1846.
    The facts of the case are stated in the following circuit decree.
    Johnston, Ch. This is a bill claiming redress for the alleged negligence of a trustee, by which the trust property has been lost to the cestui que trust.
    
    On the 15th of December, 1806, Sarah C. Porcher, the mother, and Lawrence Hext, the father of the plaintiffs, on the eve of their intermarriage, which shortly afterwards took place, entered into a deed of indenture with James Porcher, the intestate of the defendant, whereby the said Sarah C. conveyed all her individual interest in the estate of her deceased father, Peter Porcher, and of her deceased uncle, William Young, to the said James Porcher, in trust, after the marriage, for the joint use of herself and her intended husband, during their joint lives, and to the survivor of them, with remainders in fee, to the issue of the said Sarah C. by that or any subsequent marriage.
    The trustee, James Porcher, caused the deed to be registered in the registry of Mesne Conveyance for Beaufort District, thirteen or fourteen days after its execution, but it was never registered in the Secretary of State’s office, and the original is now in the defendant’s possession, as administratrix of the said trustee.
    After the intermarriage of Lawrence Hext and wife, her shares in said estates were partitioned off to her, and there came into the possession of the husband a number of slaves, who, with their increase, now number some seventeen or eighteen.
    All these slaves were sold to hona fide purchasers, (without notice either by Lawrence Hext himself or by the Sheriff,) for his debts, with the exception of two, as to which no relief is sought against the defendant. Lawrence Hext and his wife are now both dead, and the plaintiffs, who are the issue of the marriage, claim an account of the value of the slaves lost to them by the negligence of their trustee to register the deed in the proper office, so as to charge the purchasers of the trust property with notice, and enable the plaintiffs to recover it from them. It appears, from an examination of the Registry of Mesne Conveyance for Beaufort District, from 1787 to 1812, inclusive, that forty-six marriage settlements were recorded in that office, of which twenty-three were settlements of real and personal property, eighteen of personal property, and the remaining five of property the character of which is undefined.
    This is the case stated by the counsel, for the consideration pf the Court; and the question is, whether, under these circumstances, the trustee was liable for the losses sustained by his omission to record the deed in the Secretary of State’s office.
    My impressions of this case have materially changed, since the hearing; and I cannot now say, as I would have said then, that the conduct of the trustee was and is to charge him. I do not doubt that it was his duty, after accepting the trust, to perform any act necessary for the preservation of the property, and for securing the interests of his cestui que trusts, and to record the deed, as one means of attaining these ends.
    Nor is it any longer a question, that the proper office for .the registration of marriage settlements, under the Act of 1.785, was that of the Secretary of State; although that seems to have been doubted, up to the decision of Boatwright vs. Wingate, 2 Treadway, 522, which was long after this deed was recorded, and it will appear, by the opinion of the Judges in that case, that one of them, who, &t the registration of this deed, was the leading counsel in Beaufort, and had the principal direction and control of the business there, was strenuously of opinion that such a registration as was made, in this case, was effectual and valid. My own opinion, while ■ at the bar, was, and is still, that under .the Act of 1785, settlements of personalty were to be recorded in the Secretary’s office., and that as to settlements of realty, they were subject to a double registration: one in the Secretary’s office, as settlements under the Act in question, and the other in the Registry of Mesne Conveyance, as deeds for conveying lands, under the Act upon thaj subject. The trustee, therefore, did not comply with the law, by the registration which he caused to be made in this case, and his cestui que trusts, the preservation of whose interest was the very end of his appointment, have suffered loss by his omission.
    But the liability of trustees is not measured by the abstract rule of their duty. The universal test of their liability,-or exemption from liability, is this: is there, or is there not, in this case, evidence of faithful endeavors to fulfil it ? The office of trustee is one essential to every important interest in society, and so far from those interests being promoted, they would be deeply prejudiced, if any rule more rigorous than this— any rule calculated to deter prudent and honest men, of ordinary capacity, from accepting the appointment — were laid down, or insisted on. The partial effect of that rule would be to confine the office to the crafty and dishonest, who' might accept with the hope of eluding liability, and securing profit by fraud and dexterity. The test of liability, as I have laid it down, is to be gathered from all the cases upon the subject,, and I shall not trouble myself with an analysis of them. There may be strong expressions to the contrary effect, but the broad leading principle of all the cases is as I have stated it. It has sometimes been said, as I have laid it down in Cooper vs. Dayt 1 Richardson’s Eq. 26, that if the act done by a trustee, be such as a prudent man would not have done in his own affairs, or if that which the trustee has omitted, be what a prudent man would not have omitted in matters of personal interest, the trustee shall be liable. But this rule is manifestly subsidiary. It is used as a test of unfaithfulness, which, after all, is the fundamental ground of liability. If a trustee does, or omits, what a prudent man would not do or omit, in his own concerns, and there is no more, in the case than that, it may be set down as presumptive evidence of indifference to his duty. And in the case 1 have mentioned there were circumstances, (if their aid had been required,) to give a tinge to the conduct of the trustee, and to strengthen the presumption arising from his unexplained omission to record the deed. But here the omission does not stand alone. There are circumstances which might refute the presumption that might arise from it, and to show that the trustee was honest and diligent, but mistaken. The fáult is not an omission to record, but a mistake in the office where it was done. The registration, though erroneous, is proof of a faithful intention to perform the duty required by law, which intention is none the less meritorious on account of the mistake. The mistake appears also to have arisen naturally from the general custom of the times, in which prudent men, trustees and others deeply interested, indulged; and it appears to have been grounded upon very high authority.
    I do not conceive, that to take advantage of a mistake, committed in an evidently honest endeavor by the trustee to perform his duty, and to make him liable for the consequences, would either square with the dictates of justice, or promote the true policy of the Court or the interest of its sanctions, and it is ordered that the bill be dismissed.
    
      The complainants moved to reverse the decree of his Hon- or, Chancellor Johnston, in the case above stated, on the following grounds:
    1. Because it was made clearly to appear, by the bill, answers, exhibits and evidence, that the property to which complainants were entitled, had been lost in consequence of the negligence or omission of the trustee, James Porcher, to cause the trust deed to be registered m the proper office, and therefore the estate of the said James Porcher should have been held liable for the loss so sustained.
    2. Because it is conceded, by the very terms of the decree, that the trustee, James Porcher, was bound to cause the trust deed to be recorded; and it is respectfully submitted, that the fact that the trust deed was recorded in the wrong office, is not any proof of dilligence, prudence or skill, nor is it any excuse.
    3. Because the decree is contrary to law, equity, and evidence.
    W. F. Hutson, E. Bellinger, Jr. and J. M. Hutson, for the motion.
    Colcock, contra.
    
   Johnston, Ch.

delivered the opinion of the Court.

This Court concurs in the decree of the Chancellor, and it is ordered that the decree be affirmed, and the appeal dismissed.

Dunkin, Ch. and Caldwell, Ch. concurred.

Harper, Ch. absent at the hearing.

Appeal dismissed.