Case ID: va_38/html/0711-01.html
Source: Caselaw Access Project
Author: {"author": "TUCKER, P.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Wilkins v. Gordon & Wife & Others.
    February, 1841,
    Richmond.
    Deeds of Trust — Debt Ascertained — Duty of Trustee.— Deed of trust conveys property to a trustee, in order to secure payment of a debt “not then ascertained but supposed to be about 8000 dollars,” and of another debt “not then ascertained but supposed to be about 1800 dollars;” and by a subsequent deed of trust, part of the same trust subject is conveyed to another trustee, to secure payment of the same debts, stating the one to be “about 2000 dollars,” and the other “about 1800 dollars," with power to the trustee to sell the trust subject, and pay the debts out of the proceeds: Held, the trustee under the last deed cannot proceed to sell the trust subject till the amounts of the debts actually due are ascertained by proper settlements.
    Same — Same—Same.—Where a debt secured by a deed of trust appears by the deed to be of unas-certained amount, either party may resort to a court of chancery to have the amount ascertained by accounts taken under its direction, and all accounts affecting the amount of the debt ought to be directed; and the trustee cannot proceed to sell the trust subject until the debts are settled and ascertained.
    James Corbin died intestate and without issue in 1834, leaving a small real estate and personal of much greater value. His distributees were his widow Mary, who was entitled to half of his personal estate, and his mother Daphne West, and his natural brothers on the mother’s side, Austin Peay, Benjamin Hnrd, and Corbin Dane, who were each entitled tó a fourth of the other half. Mary, the widow of James Corbin, took administration of his estate; and James Wilkins and Gulielmus Smith were her sureties in her administration bond.
    Corbin Dane also died intestate and without'issue. His distributees were his widow Mary, who afterwards married Grandison Boyd, and who was entitled to one half of his persona1 estate, and his mother Daphne West and his natural brothers Austin Peay and Benjamin Hord, \vho were each entitled to a third of the other half. James Wilkins took administration of his *estate, and Gulielmus Smith was his surety in his administration bond.
    Mary, the widow and administratrix of the first named decedent James Corbin, being about to remove to the state of Ohio, and having an unsettled account with James Wilkins, who, it seemed, had been her agent or assistant in the administration of her intestate’s estate, she and Wilkins, in April 1836, got mr. Barton (the well known commissioner of the court of chancery at Predericksburg) to settle their accounts for them; and upon that settlement, she was found indebted to him, from 800 to 1100 dollars. Whatever the balance was, she paid it immediately, by a transfer to Wilkins of bank stock and some other funds. At or about the same time, she put into Wilkins’s hands twenty-five other shares of bank stock which she still owned, and some other effects, authorized him to sell the bank stock and effects for her, and , appointed him her agent to collect the rents of a small real estate she held in Predericksburg. She then removed to Ohio, and shortly after married Andrew Gordon.
    Wilkins sold the twenty-five shares of bank stock; but he did not remit the whole proceeds thereof to Gordon and wife: he remained their debtor for probably much the greater part thereof. In 1838, they constituted Barton their agent to settle Wilkins’s accounts, and to collect the balance due to them. His effects to bring about a settlement of the accounts were ineffectual ; and they were not settled. But in November 1838, Wilkins requested Barton to draw a deed of trust, mortgaging his property for the benefit of his creditors, and for the indemnification, of Gulielmus Smith, his surety for the due administration of Corbin Dane’s estate, ‘ and providing (among other specified debts) for the debt he owed Gordon and wife, and for the debt which as administrator of Lane he owed to his distributees.
    *By this deed, dated the 7th November 1838, — reciting that James Wilkins “was justly indebted to Andrew Gordon and Mary his wife, in their individual characters and as administrators of James Corbin, in a sum not then ascertained but supposed to be about 2000 dollars, and to Mary Boyd, Daphne West, Austin Peay and Benjamin Hord, as distributees of Cor-bin Dane, in a sum not ascertained but supposed to be about 1800 dollars,” and to sundry other creditors therein named in certain specified sums,' — 'Wilkins conveyed and assigned to Isaac Cary, divers lots in or near the town of Fredericksburg, some lands in Randolph county, four horses and other chattels, and certain debts stated in a schedule annexed; upon trust, that Cary should permit Wilkins to hold possession of the land and other property (except the debts assigned) and to take the profits, until default should be made by him in- the pajunent of the debts due to the creditors, “the same being accurately ascertained, and payment thereof demanded” either of Wilkins or of Cary the trustee; and that upon such default of payment, and upon the request of the creditors, or a majority of them, the trustee should sell the trust subject, real and personal, at auction, for cash, and out of the proceeds, pay the debts in the deed mentioned, and then any other debts due from Wilkins to other creditors, and the surplus, if any, to Wilkins.
    James Wilkins, the mortgagor, was after-wards taken in execution by the sergeant of' Fredericksburg for debts due to other creditors; and thereupon, he took the benefit of the statute for relief of insolvent debtors; surrendering to the sergeant all his effects, and inter alia his equity of redemption in the' property, real and personal, mortgaged by the deed of trust of the 7th ■November 1838. The sergeant made sale of all the effects mentioned in the schedule and surrendered by the insolvent; John Wilkins (the son of James) became -the purchaser; and the sergeant conveyed and assigned *the effects to him, by deed dated the 20th- March 1S39.
    Cary, the trustee in the deed of trust of the 7th Ñovember 1838, sold to the same John Wilkins, all the real estate thereby conveyed to him in trust, the aggregate of the purchase money being 3725 dollars; and he conveyed the same to him, by deed dated the 20th August 1839. But John Wilkins, in fact, paid no part of the purchase money. All the other debts secured by that deed of trust, except the debts due to Gordon and wife and the distributees of Dane, had been paid.
    Then, by- deed dated the same 20th August 1839, — reciting, that John Wilkins stood indebted to Gordon and wife “in and about the sum of 2000 dollars,” and to Austin Peay in his own right and as as-signee of Boyd find wife, Daphne West and Benjamín Hord, as distributees of Corbin Dane deceased,'“in and about the sum of 1800 dollars, ” ,with interest on both debts from the 7th November 1838, — John Wilkins, in order to secure payment’ of those debts, conveyed to Barton (the agent of Gordon I and wife) all the real estate which was comprised in the deed of trust of the 7th November 1838, and which had been sold and conveyed by the trustee Cary to John Wilkins, as before mentioned; upon trust, that Barton should permit him to remain in possession and enjoyment of the profits of the premises, until default should be made in the payment of the debts, or of either of them, or of any part thereof, and the interest upon the same; and that upon such default being made, and upon request of the creditors, or of either of them, Barton should advertise and sell the premises, or so much thereof as should be necessary for the purpose, at public auction, for cash; and out of the proceeds, should first defray the expenses attending the execution of the trust, and then pay the debts above mentioned, with interest, “or such part thereof as might be due,” and the surplus, if any, to John Wilkins or his assigns.
    *Barton, the trustee in the last mentioned deed of trust, advertised the trust subject for sale on the 31st July 1840, to satisfy the debts therein mentioned and secured, without specifying in the advertisement, the amounts of the respective debts then due.
    Upon this, John Wilkins exhibited a bill in chancery in the circuit superior court of Spotsylvania, against Gordon and wife, and Austin Peay in his own right and as administrator of Daphne West, Boyd and wife, ^nd Benjamin Hord, distributees of Corbin Dane, Gulielmus Smith the surety of James Wilkins for his administration of Dane’s estate, Cary the trustee in the first, and Barton the trustee in the last, of the deeds of trust above mentioned; wherein, after setting forth the several conveyances, he alleged, that as to the debt therein mentioned to be due and intended to be secured to the distributees of Dane, it had been ascertained, and acknowledged by those creditors themselves, that that debt, instead of being 1800 dollars, did not exceed 750 dollars. That the accounts between Gordon and wife and James Wilkins had never been settled, and so the true amount due from the latter to the former was yet uncertain, and it was in fact much less than 2000 dollars, the sum mentioned in the deeds of trust. That since the deed of trust of the 7th November 1838 was executed, James Wilkins had paid many sums of money to or for Gordon and wife, which ought to be credited to him. That the accounts of mrs. Gordon’s administration of her first husband James Corbin’s estate had never been settled and closed; balances were still due to the distributees of that intestate, and, among the rest, to the estate of Corbin Dane; and James Wilkins as Dane’s administrator, was entitled to the balance due Dane’s estate, for which he would be accountable to Dane’s distributees. That James Wilkins being mrs. Gordon’s surety for the due administration of James Corbin’s estate, was entitled *to have her accounts of administration thereof settled and closed, before his property should be sold to pay the alleged debt to her, since he might be made liable as her surety for whatever debts she might owe to her intestate’s distributees. And that the twenty-five shares of bank stock, and the other effects, which she put into his hands when she went to Ohio, was received by him as security for advances already made and afterwards to be made by him to or for her, and as an indemnification to him against loss by reason of his suretyship for the due administration of her first husband’s estate. Therefore, the bill prayed, that the claims mentioned in the deeds of trust should be adjusted and ascertained by proper accounts to be settled under the direction of the court, and that, in the mean time, the trustee Barton should be enjoined from selling the trust subject; and general relief.
    The injunction was awarded.
    Gulielmus Smith answered, and insisted on the prompt execution of the deed of trust, upon which his indemnification depended, since his principal James Wilkins was insolvent.
    The answer of Austin Peay in his own right and as administrator of Daphne West and of Benjamin Hord stated, that Herd had received all that he was entitled to as a distributee of Corbin Lane, and Mary Boyd had received more than she was entitled to, and had, moreover, by deed recorded, assigned to Peay all her claim as one of Lane’s distributees. That in 1839, the accounts of James Wilkins as administrator of Lane were settled, or rather a compromise was made in respect thereto, between him and Peay; upon which all credits claimed by Wilkins for payments to the distributees were allowed him, and it was agreed that he should pay Peay 750 dollars; Wilkins promised prompt pa3'ment of that sum to him; and upon the faith of that promise Peay agreed to accept it in full satisfaction ; *but Wilkins had never paid it; Peay, therefore, insisted that the trust subject should be presently sold in order to pay him that balance. And that mrs. Gordon’s accounts of administration of James Corbin’s estate had been settled ; she had accounted for all the assets that had come to her hands, and had paid and distributed the whole surplus of that estate to the' distributees, and among the rest to James Wilkins the administrator of Lane; except a small balance which had been left in her hands to pay a debt due from the estate; and these defendants exonerated Gordon and wife fro’m all demands on that account.
    Gordon and wife, in their answer, stated that at the time the deed of trust of the 7th November 1838 was executed by James Wilkins, it appeared by his own vouchers exhibited to their agent Barton, that he owed them something more than 2000 dollars; and as he had, on various pretexts, avoided a full settlement of his account, that sum was inserted in the deed of trust as being the least amount due to them ; and he had never since paid them any thing. That the twenty-five shares of bank stock, and the other effects, which mrs. Gordon put into the hands of James Wilkins when she removed to Ohio in 1836, were, as he well 'knew, her own property; she empowered him to sell the stock and the other effects, and also to collect the rents of her real estate in Fredericksburg; and he was to account for and remit the proceeds of sale of the stock and the other effects, and the rents, to her. That the property was not put into his hands as a security or indemnification for any purpose whatever. That she had paid him all that she owed him, or that he claimed, before she left Virginia. That it was true her accounts of administration of James Corbin’s estate had not been finally settled, but she had rendered an account of all the assets which had come to her hands, and distributed the surplus to and among all the distributees to their satisfaction, ^except a small sum which they had agreed should be left in her hands to meet a claim against the estate for which a suit was then pending ; and thus the state of her administration accounts furnished no pretext for delaying the payment of the debt which James Wilkins owed her.
    It appeared, that mrs. Gordon’s accounts of administration of James Corbin’s estate had been settled, . and the surplus (except 500 dollars, left in her hands by agreement of the parties to meet claims asserted against the estate) had been distributed, under a decree of the hustings court of Fredericksburg; in which distribution thirty-six shares of bank stock were assigned to her for her distributive share. There remained to be distributed, so much of the 500 dollars as should not be absorbed by the outstanding debts of the estate, and James Corbin’s share of the estate of James Boss, then in the hands of Boss’s administrators.
    The deposition of mr. Barton, the trustee, was taken and filed. He stated, that before mrs. Gordon went to Ohio, he in April 1836, settled the accounts between her and James Wilkins, at their request; that upon that settlement, Wilkins exhibited an account against mrs. Gordon, consisting partly of a balance which he claimed for advances made to her, and partly of debts he had paid or assumed to pay for her, amounting in the aggregate, according to his recollection,-to between 800 and 1100 dollars ; that the whole of Wilkins’s account (including all the claims, as they both stated, which he had against her, for advances made and debts paid or assumed by him for her) was then paid by her to him, by a transfer of seven shares of bank stock and from other resources. That mrs. Gordon had then twenty-five shares of bank stock remaining, which she put into Wilkins’s hands, as he had acknowledged; and she also authorized him to collect her rents in Fredericksburg: that in 1838, Gordon and wife (not being able, as they alleged, to get any ^'account from Wilkins of the bank stock, its dividends or proceeds, and of the other propert3r she left in his hands, and of the rents) sent an agent to Virginia to procure a settlement of the accounts; this the agent could not affect, but Wilkins paid him 500 dollars ; and then the agent employed Barton to settle the account, and collect the balance: that after various ineffectual efforts to bring about a settlement, Wilkins called upon him in November 1838, and requested him to draw a deed of trust for the benefit of his creditors, and, at his instance, the debts due from him to Gordon and wife, and to the distributees of Corbin Lane, were provided for in the deed: that, in estimating the debt due to Gordon and wife, Barton charged Wilkins with the twenty shares of bank stock at 112 dollars per share .(the actual value) with the dividends thereof for July 1836 which he had received, and interest on the value of the stock sold, and with 72 dollars which he admitted he had received for rents; and he credited him for the 500 dollars paid to the. agent of Gordon and wife, and with the whole of his charges against them not included in the previous settlement with mrs. Gordon in 1836, that were sustained by any evidence, and some that were not, but that Wilkins said he could prove: that the result was, that Wilkins was found to owe Gordon and wife a balance of above 2100 dollars; but Wilkins stating that he had other accounts. and vouchers to produce, .which (according to Barton’s recollection) he supposed would leave onlj" 2000. .dollars, the balance was stated at about that sum; and though Barton at the time believed that more was due to Gordon and wife, he agreed that the debt should .be stated, as of that amount in the deed: that after Barton had resolved to execute the deed of trust, Wilkins for the first time began to talk. of setoffs against the claim of Gordon and wife; Barton urged him to exhibit them, and go into a settlement; offered to go over the whole account with *Wilkins’s counsel; and promised to allow him eyery credit that he could prove, or that was even plausible; but all was rejected; Wilkins admitting, that he could not'prove his account, and that all must rest on the admissions of Gordon and wife, who he insisted should come from Ohio, where they resided,, to hear his.explanations: and that under these circumstances Barton proceeded to advertise the property for sale under the deed of trust of August 1839.
    There was an ex parte affidavit filed, to prove that Wilkins, in June 1840, sent an account to Gordon and wife, wherein there were numerous charges for moneys sent them, or paid for them, subsequently to April 1836.
    Upon this state of the pleadings and proofs, the circuit superior court dissolved the injunction that had been awarded to stay proceedings under the deed of trust of August 1839; as to the defendants Gordon and wife, for 2000 dollars with interest from the 7th November 1838; and as to- .the defendants Peajr. and Hord, for 750 dollars with interest. from the 15th October 1839, upon the last named defendants giving the usual refunding bond to James Wilkins administrator of Corbin Lane, to indemnify him against debts of his intestate outstanding and unforeseen..
    From this decree, the plaintiff applied by petition to this court, for an appeal; which was allowed. '
    Patton, for appellants.
    R. C. Stanard and Lyons, for appellees.
    
      
      Deeds of Trust — Sale—Duty of Trustee. — In Spencer v. Lee. 19 W. Va. 187, 188, it is said: “No general principles are better settled than, that a trustee Is the agent of both parties and must consult Impartially the interests ol each. He is bound to bring the property to sale in the way, which will secure the best price, and to accomplish this he is required to exercise reasonable diligence and to observe those precautions, which wcfuld naturally be observed by a prudent bnslness-man in an important business-transaction. It is his duty to see, that no encumbrance or cloud upon the title or any Impediment to a fair sale for the best price remains unremoved. He is supposed to be the common friend and agent of both parties impartial and disinterested, whose duty it is to act justly and discreetly towards those in interest. In order that the trustee may thus act, a court of equity is always open to him, when the amount due by the deed is uncertain or is in good faith disputed, when any cloud rests upon the title, when a reasonable price cannot be obtained, or when for any reason a sale is likely to be accompanied by a sacrifice of the property, which at the cost of. some delay may be obviated. Rossett v. Fisher, 11 Gratt. 492; 1 Tuck. Com. B. II. p. 107; 1 Lom. Dig. 425; Lane v. Tidball, Gilm. 182; Wilkins v. Gordon, 11 Leigh 547; Miller v. Argyle’s Ex’r, 5 Leigh 460; Quarles v. Lacy. 4 Munf. 251; Gay v. Hancock, 1 Rand. 72; Chowning v. Cox, 1 Rand. 306; S. C. 3 Leigh 654 (Taylor v. Chowning); Gibson v. Jones, 5 Leigh 370; Norman v. Hill, 2 Pat. & H. 676.”
      See also, citing the principal case on this subject,. foot-note to Griffin v. Macaulay, 7 Gratt. 476; Bank v. Hupp, 10 Gratt. 59; Rossett v. Fisher, 11 Gratt. 499 (see note): foot-note to Shurtz v. Johnson, 28 Gratt. 657: foot-note to Hogan v. Duke, 20 Gratt. 244; Schultz v. Hansbrough, 33 Gratt. 579; Muller v. Stone, 84 Va. 837. 6 S. E. Rep. 223; Morriss v. Virginia St. Ins. Co., 90 Va. 374, 18 S. E. Rep. 843; Feamster v. Withrow, 9 W. Va. 323: Conrad v. Buck, 21 W. Va. 411; Hartman v. Evans, 38 W. Va. 679, 18 S. E. Rep. 814.
    
   TUCKER, P.

It was said by this court in the. case of Lane v. Tidball, Gilm. 130, that a trustee, in the exercise of his duty as an impartial agent of both parties, may apply to a court- of equity., to adjust the actual sum which is to be raised by the sale, and that if he should fail to do so, the party injured by his default has an unquestionable right to do it. This, indeed, would *seem to be an axiom in the law. Until the amount of the creditor’s demand is adjusted, he cannot resort to compulsory means to enforce the payment. Even the judgments of a court of justice have no validity, and can be enforced by no execution, where they leave the amount of the demand uncertain, and depending for ascertainment upon subsequent adjustment. A fortiori, these judgment bonds, as they have been not unaptly called, tq which, when the debt is certain, we have given, perhaps unwisely, the .force of judgments, ought not to be regarded in that light, where they do not fix, distinctly and definitely, the amount of .the demand. In all such cases, the deed of trust has but the effect of a mortgage. It secures the debt indeed, . but it vests no power in the creditor, or in his trustee, to enforce payment, except through the agency of the courts, unless the amount be voluntarily adjusted by the agreement of the parties. However unreasonable the debtor may be in refusing to settle, his vexations and ■litigious spirit can yet give no right to the creditor to take the law into his own hands, by proceeding to execute the trust. It is his duty to seek from the tribunals of justice, the settlement of his accounts; and when that has been effected the enforcement of the trust will become lawful, but not till then.

The present .case. comes fully, I think, within the influence of these principles. It is very clear, that the deed of trust of November 1838 was given without definitively fixing the amount of the demand. It does not appear, that there was any adjustment of it between the dates of the first and the second, deed of trust of August 1839. And the latter deed, though not in terms so strong, as the former, speaks of the debt to mrs. Gordon as “in and about 2000 dollars;” and that to Lane’s distributees as “in and about 1800 dollars;” still leaving uncertain the actual amounts due. The last has been confessedly reduced to 750 dollars. And thus we *have an evidence how little confidence is to be placed .in the expressions “in and about,” as fixing the true amount of the demand. Moreover, long since the deed of August 1839 the parties say they were willing to go into a full account, and to allow any offsets which could be proved; thus sufficiently-admitting that there was nothing definite as to the amount of debt, in the deed of trust. They allege, indeed, that Wilkins prevaricated, and very probably he did; but this, though good cause for suing him, was no justification of an attempt to sell the trust subject, without an appeal to the tribunals of justice to compel a settlement. There was, then, ample ground for the injunction; and as the state of the case is not changed materially since filing the bill, and as the accounts are still. in the same state of uncertainty as before, I think the injunction was improperly dissolved. .Accounts ought to have been directed embracing not only the accounts between Wilkins and Gordon & wife, but the account of administration of the estate of James Corbin, of whom Wilkins’s intestate Corbin Lane was a distributee. The account of Wilkins with Peay in his own right, and as representing Lane’s other distributees, should also be settled, and proper refunding bonds decreed, before action on the deed of trust is permitted.

The other judges concurred. Decree, that the circuit superior court ought not to have dissolved the injunction, without having first directed a settlement, of the proper accounts, namely, not only the accounts of Wilkins with Gordon and wife, but the accounts of the administration of the estate of James Corbin, of whom Wilkins’s intestate Corbin Lane was a distributee,. and the account of Wilkins with Peay in his own right and as representing Lane’s other distributees; and then directing proper refunding bonds to be given: therefore, decree reversed with costs, the injunction reinstated, and the cause remanded for further proceedings.