Case ID: abbn-cas_26/html/0271-01.html
Source: Caselaw Access Project
Author: {"author": "Potter, J. (in part dissenting.) \n      By the Court, Bradley, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

HOOD v. HAYWARD.
    
      N. Y. Court of Appeals; Second Division,
    
    
      January, 1891.
    [Affirming (except as to interest) 48 Hun, 330.]
    1. Executors and administrators ; remedy on bond.] Where the letters of one of two co-executors, administrators, testamentary trustees or guardians have been revoked, the other may be regarded as his “ successor ” within the meaning of Code Civ. Pro. § 2608—which provides that where letters have been revoked by surrogate’s decree, the successor of the one whose letters are so revoked may maintain an action on his predecessor’s official bond, for the benefit of the estate. Hence, after the removal of one of several co-executors, the others may sue on the bond without first issuing execution upon the surrogate’s decree for disobedience to which the action was brought.
    
    
      2. The same ; various remedies on bond stated.] The remedies given by Code Civ. Pro. §§ 2607-9 provide for three distinct classes of cases, namely: 1. Where a person having recovered a surrogate’s decree against the representatives, sues ,on the bond after return of execution unsatisfied (§ 2607.) 2. Where letters have been revoked and the succeeding administrator sues to recover assets, not duly administered (§ 2608), 3. Where letters have been revoked and no successor appointed, in which case any person aggrieved may, by leave of the surrogate, sue in behalf of himself and all others interested (§ 2609)
    
    3. The same concurrent remedy against predecessor.] The rule in Sperb v. McCoun, no N. Y. 605, that the successor in administration may, by virtue of § 2607, sue after decree and execution returned unsatisfied, does not preclude a suit without execution first issued, as allowed by § 2608.
    4. Release of one of several jointly or jointly and severally liable.] A release of one of several who are jointly and severally liable on contract or jointly liable for a tort may be so framed as to reserve the liability of the others, so far as necessary to preserve to the releasor his right to full satisfaction^
    
      Form of an absolute release, and qualified release simultaneously-delivered, effectual together as a release of one only of two sureties.
    5. Accord and satisfaction.] An acknowledgment of satisfaction of the demand, is essential to constitute an accord and satisfaction ; and a release of one of several obligors, on receiving from him part payment, is not enough.
    6. Principal and surety.] One of several sureties has no equity ta object to a release or other favor shown to his co-surety, provided the effect be not to charge the former with a greater burden than he would have to bear if both were held liable, and he had the benefit of contribution from his co-surety.
    7. Interest on bond of surety for delinqtient executory A surrogate's decree revoking the letters of an executor for misconduct, although it incidentally adjudicates as the ground for revocation a misuse of assets to a specified amount, does not, for the purpose of allowing a recovery against the sureties in excess of the penalty of the bond, set interest running, but such interest commences to run from the subsequent date of a decree on accounting, establishing the executor’s liability and directing him to pay it.
    8. Bond; liability of surety beyondpenaltyl\ Under the rule, now established, that interest by way of damages may be allowed, though to the excess of the penalty, from the date at which it is determined that there has been a breach,—if the condition is to pay money on a day certain, interest will run from that day; if the condition is for the performance of an act,—which is the nature of an administration bond,—interest will run from the date when a competent court adjudicates the breach and fixes the damages.
    9. The same. Hence the decree in an accounting, liquidating the deficiency and adjudging payment of it by the executor, which must be had before suing on his bond, is the time at which interest to exceed the penalty can begin to run, notwithstanding the language of Code Civ. Pro. § 1915, declaring a bond conditioned for the performance of an act to have the same effect as a covenant to pay the sum, or to perform the act, etc.
    
    
      10. Defences; counter-claim or equitable defence that a trustee-plaintiff participated individually in the breach of trust.] In an action by one acting as trustee against the sureties on the co-trustee’s bond, the fact that the plaintiff participated in the breach of trust by the co-trustee, in which it is sought to charge the sureties, cannot avail them as an equitable counter-claim or set-off, for it seeks to charge the plaintiff individually in an action brought in a representative capacity.
    
    11. Limitations of actions on administration bondI\ On an administration bond under which an accounting of the principal and decree against him is a necessary preliminary to suit, the statute of limitations against the sureties does not begin to run till such decree is had.
    
    Appeal from a judgment.
    Maria L. Hood as executrix, etc. brought this action against John N. Hayward and Frederick Hood, upon a bond executed by Frederick Hood, executor, and Hayward and one David Moffat as his sureties, for the fidelity, etc., of Hood as executor.
    The appeals in this action now taken were from a judgment rendered at a general term of ■ the supreme ■court of the second department affirming a judgment rendered on a trial at Special Term without a jury.
    The plaintiff appealed, from so much of the judgment as refused to allow interest from August I, 1875, ■or October 1, 1878.
    The defendant Hayward appealed from the whole judgment. There was no appeal on the part of the defendant Frederick H. Hood.
    This action was brought on a bond executed by the defendants, Hood, Hayward and one David Moffat upon the issuing of letters testamentary to the defendant Hood, as executor of the last will and testament of Andrew Hood, deceased, by the surrogate of Westchester county, to recover damages sustained by the estate in consequence of the misconduct of the executor-Frederick H. Hood.
    The plaintiff Maria L. Hood, was an executrix and associated with the defendant Frederick H. Hood in the administration of the estate, but the bond was given on behalf of Frederick H. Hood who was a non-resident at the time of the granting of letters testamentary.
    ' From the case it appears that Andrew Hood, the testator, died on March 18, 1864, leaving a last will and testament which is set forth in the complaint; that will was duly admitted to probate by the surrogate of Westchester county on April 20, 1864, and on April 30, 1864, letters testamentary were issued by said surrogate to Frederick and Maria L. Hood, as executor and executrix, named in said will; that upon an accounting had on or about January 6, 1869, there was found to be in the hands of the executor and executrix assets amounting to fifty-three thousand dollars and upwards, and they were directed by the decree of the surrogate to invest the same in accordance with the provisions of the will ; that the defendant Frederick H. Hood, executor, had the charge and management of this sum of money and invested $29,100 thereof in the purchase of real estate situated in the city of Newark, in the state of New Jersey; that said sum was wholly lost to the estate ; that subsequently and on or about December 7, 1883, the said surrogate of Westchester county, upon an application before him for that purpose revoked the letters testamentary granted to Frederick H. Hood on account of investments of a portion of the moneys of said estate contrary to the decree of the surrogate made as aforesaid ; * that subsequently in the month of May, 1885, the plaintiff instituted a proceeding before the surrogate, praying that Frederick H. Hood, executor, account for the moneys received by him, and afterwards and upon July 31, 1885, the said surrogate made a decree disallowing the said investment of $29,100, and ordered and directed that said sum, together with the further sum of $2,675, amounting in all to the sum of $31,775, be paid by said Hood, executor, to the plaintiff as executrix; that soon after the making of said decree, a copy thereof was duly served upon Frederick H. Hood, and payment of the money therein mentioned demanded of him (which was refused) and that in the month of September, 1885, the said surrogate granted leave to the plaintiff to bring an action on the bond hereinbefore mentioned ; that said Moffat, mentioned in said bond, was released from any liability on said bond excepting one half the penalty thereof, to wit, the' sum of $10,000, leaving and reserving, however, and excepting all cause and causes of action against the defendant in this action and all liability under said bond, and that this action was commenced on September 15, 1885. The answer of the defendant sets forth that the bond was satisfied and discharged as to the defendant Hayward by reason of the discharge- and release thereunder of said Moffat; that there had been no execution issued and returned unsatisfied upon the decree made by the surrogate fixing the amount of Hood’s liability as executor; that the plaintiff was liable with the defendant, Hood, for any loss to the estate by reason of the investments above mentioned; also the ten years statute of limitations and the six years statute. Other facts appear in the opinion.
    
      The supreme court, at general term held that the release of the one surety, though not in the form of a covenant notjto sue, was not a release of the other, nor an accord and satisfaction; that issue of execution on the surrogate’s decree was unnecessary because the remaining executor might be deemed a “ successorthat the bond was not to be restricted to obedience to orders, authorized by law at the time the bond was given ; that the fact of the plaintiff’s participation in the objectionable investments was no bar to the action because the beneficiaries of the plaintiff’s trust did not so participate ; that since the liability of the sureties became fixed at the limit of the bond at the time the surrogate adjudged that he had been guilty of misconduct, and revoked his bond, interest began to run upon such amount from that date ; that leave to sue was not necessary for plaintiff was a “ successorthat the allegation that plaintiff had acted with the delinquent executor, and was liable with him, was not available as a counterclaim admitted by failure to reply, because she sued in a representative capacity, and this claim sought to charge her individually; nor was it proved that there was no evidence of insolvency even supposing proof of that fact would avail to make out an equitable defence or set off; and that neither pendency of the former suit nor the statute of limitations could avail against this suit; and that the delinquent executor held the money as executor, not as trustee. Reported in 48 Hun, 330.
    
      A. J. Dittenhoefer, for defendant.
    
      John J. Macklin, (.Roe & Macklin attorneys), for plaintiff.
    
      
       See note at the end of this case.
    
    
      
       Section 2607 will enable an administrator whose co-administrator has been removed, to sue on the bond, after obtaining a decree for payment and delivery of the fund, and execution thereon unsatisfied. Sperb v. McCoun, 110 N. Y. 605.
    
    
      
       § 2608. To similar effect Boyle v. St. John, 28 Hun, 454; s. C., 16 Weekly Dig. 84, although the bond is joint, and plaintiff is liable on it.
      In Perkins v. Stimmel, 114W. Y. 359, 365 ; S. c., 23 St.ate Rep. 657,. is a dictim that this section does not create an exception to the general rule that all actions for an injury to the ward’s estate should be brought in the name of the ward, not in that of the guardian.
    
    
      
       § 2609. This section may, if necessary, be relied on to support an action by an administrator whose co-administrator has been, removed, for the former is a person “ aggrieved ” in such case. . Sperb v. McCoun, no N. Y. 605 ; S. P. Boyle v. St. John, 28 Hun, 454.
      § See note on this subject in 23 Abb. N. C. 194, where other forms, are given.
    
    
      
       The language of that section is as follows:
      “ § 1915. A bond in a penal sum, executed within or without the State, and containing a condition to the effect that it is to be void, upon performance of any act, has the same effect, for the purpose of maintaining an action or special proceeding, or two or more successive actions or special proceedings thereupon, as if it contained a covenant to pay the sum, or to perform the act specified in the condition thereof. But the damages to be recovered for a breach, or successive breaches of the condition, cannot, in the aggregate, exceed the penal sum, except where the condition is for the payment of money, in which case they cannot exceed the penal sum, with interest thereupon, from the time when the defendant made default in the performance of the condition.”
    
    
      
       It may be different in an action of an equitable nature if plaintiff’s ■complicity was active, and defendant’s passive, and the claim is not interposed as a bar, but as protecting defendant’s remedy over. See Smith v. Rathbun, 66 Barb. 407; further decision in 22 Hun, 150, and note in 20 Abb. N. C. 433.
    
    
      
       Compare as to the limitation against requiring the executor to .account, Matter of Dunham, 22 Abb. N. C. 479.
    
    
      
      The bond in question recited Hood’s appointment as executor and the probate of the will, and was conditioned as follows: “ The condition of this obligation is such that if the above-bounden Frederick Hood, who is a non-resident, resident at Newark in the State of New Jersey, shall faithfully execute the trust reposed in him as such executor, and also obey all orders of the surrogate of the county of Westchester, touching the administration of the estate committed to him, then this obligation to be void, else to remain in full force and virtue.”
    
    
      
       Their accounts were finally settled and allowed by a decree showing that the balance in their hands had been invested under certain trusts contained in the will. But the decree did not expressly “ discharge ” them “ as executors.”
      [It has just been held that an action upon an executor’s bond will lie where it had been ordered by the surrogate that the executor’s accounts “ be finally settled and allowed as filed and adjusted,” and a balance in his hands was ordered to be invested by him according to. the trusts in the will which appointed him executor and trustee, although it did not appear that at the time of the default in the execution of the trust he had not faithfully executed the duties of executor. The burden is not on the plaintiff to show that the default occurred while acting as executor, if he has not been discharged as such. Cluff v. Day, next case in this vol. rev’g 55 Sufier. Ct. 460.]
      [It has also been held that where the temporary administrator is. also an executor of the will, the surrogate will not, upon the decree settling his accounts, insert a provision canceling his official bond. (Citing Code Civ. Pro. § 2596.) Matter of Eisner, 5 Dem. 383.]
    
    
      
       In 1881 after two of the beneficiaries under the will had become of age, a petition was filed for an accounting, and the supreme court held that the previous final accounting in 1869 was not a bar, nor was the pendency of an action brought by other beneficiaries to which these petitioners were made parties defendant, available as a defense. Matter of Hood. 27 Hun, 579.
      The court of appeals reversed this decision on the ground that as. the petition disclosed the decree on the prior final accounting, it was insufficient for not alleging any facts which entitled the petitioner to-further account. Matter of Hood, 90 N. Y. 512.
      In 1883 a petition for revocation of letters was heard in Hood z/„ Hood, 1 Dem, 392; and it was held that the fact that the petitioner had become of age and was thereupon entitled to his legacy, entitled him on a proper petition making the executrix a party to an account and to revocation of letters on a failure to account.
      On the hearing before the surrogate, the petitioners were required to elect as to whether they would go for a vacatur of the decree settling the accounts founded on an objection to service of citation, or for the revocation of letters.
      In November, 1883, 2 Dem. 583, the petitioner presented a petition for revocation of the letters which the surrogate granted.
      The supreme court reversed the decree on the ground that the proceeding being for revocation of letters testamentary, default as trustees could not be considered. Matter of Hood, 33 Hun, 338.
      This decision the court of appeals reversed on the ground that there had been no separation of functions of executors and trustees, and no express discharge of the respondent as executor. Matter of Hood, 98 N. Y. 363.
      In May, 1883, in the common pleas, the executrix was allowed by the affirmance at the general term, leave to discontinue an action she had brought on the bond after revocation of letters on the ground that the order of the surrogate granting leave to bring such action had meanwhile been reversed in the court of appeals. Matter of Hood, 12 Daly, 113.
      After further proceedings, the general term affirmed a surrogate’s decree on the accounting charging the executor with the wasted assets; and this decision the court of appeals affirmed in Matter, of Hood, 104 N. Y. 103.
    
   Potter, J. (in part dissenting.)

The decision of the main appeal involves two questions, whether the instrument executed and delivered by the plaintiff and the legatees under the will of Andrew Hood to Moffat, one of the sureties upon the bond given by the executor, discharged the liability of the defendant Hayward, the other surety upon said bond, and whether this action upon said bond against the defendant Frederick Hood as principal, and the defendant Hayward as surety, can be maintained before the issuance and return of an unsatisfied execution against the property of said Frederick Hood, the executor.

These propositions aré familiar law and scarcely need the citation of authorities to support them, viz 1 that the release of the liability of one or more joint or joint and several obligors or one or more joint tortfeasors, discharges the liability of the other; that the rule is the same in law and equity.

But these rules require for their full operation that the instrument should be a technical release without any valid limitation or restriction. The contention in this case is as to t,he character of these instrumeñts. Whether they constitute a technical and absolute release or whether they constitute a release with a valid limitation, or as more practically stated, whether they release the liability of the surety Moffat, and reserve the liability of the surety Hayward upon the bond, or whether they discharged the liability of both Moffat and Hayward upon the bond.

A reference to the instruments under consideration shows that the plaintiff as executrix and individually together with all the devisees and legatees under the will of Andrew Hood, deceased, in consideration of $7,000 to them paid by said Moffat, released and discharged him, his heirs, executors, administrators and assigns, from all causes of action, etc., etc., and especially by reason of the said Moffat having executed with one John Hayward and Frederick Hood, a joint and several bond to the people of the State of New York in the sum of $20,000 executed by said Hood as principal and by said Moffat and Hayward as sureties. The said instrument further provides that this release is intended to discharge said Moffat from all liability by reason of said bond in every respect, but shall not be construed as affecting any claim or demand which the parties of the first part or any of them have or may have against the said Frederick Hood as executor or against the said John N. Hayward as surety on said bond or otherwise.”

The same parties in addition to signing the instrument the substance of which is above stated, also executed and delivered to said Moffat another instrument which provided “ that it was intended thereby to release and discharge the said Moffat, his heirs, executors and administrators from all liability whatever of any kind and nature arising or growing out of any and all acts or omissions, neglect or defalcation of the said Frederick Hood, whether done or committed as executor, trustee, or in any other capacity, under said last will and testament of Andrew Hood, deceased, or otherwise, but that said release should not be construed as in any way affecting any claim or demand which they (the parties of the first part thereto), or any of them had or might have against the said Frederick Hood as such executor or otherwise, or against the said John Hayward as surety on said bond or otherwise.”

“ Now it is hereby declared that the intention of ■said parties is to release the said David Moffat from any and all claims which they or any of them have or might have against him, his heirs, executors or administrators under or by virtue of said bond, to the extent •of one-half of the penalty thereof, and it is expressly understood and agreed, that the said release is intended to operate as a satisfaction and discharge of one-half of the obligation arising from, or under said bond, so that the said Moffat shall be released from all claim or demand for contribution on the part of his co-surety, the said John N. Hayward, and that this instrument ■shall be taken and deemed a part of said release and incorporated therein.”

“It is also understood and agreed that nothing therein contained shall in any manner affect or impair any claim, right or demand which the parties thereto, or any of them, their or any of their heirs, executors •or administrators have or may hereafter have against the said Frederick Hood, or as against John N. Hayward as to the remaining half of the amount of said bond.”

The evidence in the case shows beyond question and without substantial contradiction that these two instruments were delivered to Moffat at the same time and upon the occasion of the payment and receipt of the consideration specified in them.

The trial coúrt has found as a conclusion of fact “ that David Moffat mentioned in said bond has been released from any liability on said bond to the extent of one half the penalty thereof, to wit, the sum of ten thousand dollars, saving and reserving however and excepting all cause or causes of action against the defendants in this action and any and all liability thereunder.” And as conclusion of law that the plaintiff as executrix is entitled to judgment against the defendant Hood, the executor, and the defendant Hayward, one of the sureties for the sum of ten thousand dollars (that sum being one-half of the penalty of the bond) with interest.

The defendant Hayward contends that he was released from all liability upon the bond by the release of the liability of Moffat.

There is no doubt that if the language of the instruments had simply acknowledged satisfaction of all claims arising upon the bond and released and discharged the same, the effect would have been to discharge both Moffat and the defendant Hayward from any further liability upon the bond. But the language of the instrument acknowledges the payment of the sum of seven thousand dollars, being less than one half of the penalty of the, bond, from Moffat, and purports to discharge Moffat only and expressly declares such to be its sole object and purpose, and that it shall not be construed as in any way affecting any claim or demand which the releasors have-against Hood as executor cr the defendant Hayward as surety upon said bond ; and in order to make this purpose more manifest and its effect more certain, they executed on a later day and delivered with the instrument just referred to, another instrument of an equal degree of dignity and solemnity, declaring that it was their intention that said instrument should “ operate as a satisfaction and discharge of one half of the obligation from or under said bond so that said Moffat shall be released from all claim or demands for contribution on the part of his co-surety, the said John N. Hayward” and “ that nothing therein contained should in any manner affect or impair any claim, demand of right which they have or may have against said Frederick Hood or as against John N. Hayward as to the remaining half of the amount of said bond.”

It will be observed that the terms of the instrument do not express that the claim or liability under the bond has been satisfied, which is the essential point in an accord and satisfaction. The terms of the discharge by the instrument expressly limit the operation of the discharge to Moffat, and reserve the liability of Hayward. 1 do not perceive any reason in the relations of the parties to this bond, as between themselves or as to the releasors to prevent the court from giving the precise effect to the instrument intended by the parties to it. Each of the sureties was liable to the releasors for the full amount of the penalty and whatever part of the penal sum either should be compelled to pay, he could compel his co-surety to contribute one half. Aside from interest neither surety could compel the other to contribute more than one half the penalty of the bond, viz: ten thousand dollars, whatever the loss of the estate may have amounted to.

In this case it amounted to much more than the amount of the penalty, so that the releasors could have demanded of each surety to pay ten thousand dollars. That is the sum which defendant Hayward was liable to pay under the bond to the releasors, and that is all he is now compelled by the judgment to pay them. What harm or prejudice has or would have been done Hayward in this case, if the releasors had forgiven the liability of Moffat outright or had received ten thousand dollars of Moffat’s money and subsequently given it back to him? I can perceive none. Certainly Hayward could not have sued and recovered •of Moffat any part of such gift. The contractual relation between co-sureties is that each shall pay one half of the amount of the liability assumed. There is no other contractual relation between them, ■certainly none that entitles one surety to share in the voluntary benefits or presents that the obligee may make the other surety. The question in this case is whether the release to Moffat discharged Hayward. What (if any) rights and remedies Hayward may have against Moffat in any contingency that may arise, need not here be considered.

But without further discussing the reasonableness -of the respondent’s contention, we think there is an unbroken line of decisions supporting the judgment in this case to the effect that the defendant Hayward was not discharged by virtue of the instrument which discharged Moffat from liability, upon the bond in suit. It is not worth while to refer to but few of the numerous cases Avhich maintain this view (Benedict v. Rea, 35 Hun, 34; Jervine v. Millbank, 56 N. Y. 635 ; Morgan v. Smith, 70 Id. 537; Bronson v. Fitzhugh, 1 Hill 185; Kirby v. Taylor, 6 Johns. Ch. R. 246; Matthews v. Chicopee Mfg. Co., 3 Rob. 711 ; Ellis v. Esson, 56 Wis. 138 (36 Am. R. 830;) Price v. Barker, 4 Ellis & Black, 760; Thompson v. Lack, 3 Com. Bench R. 540).

The great number of decisions and the discussion in the opinions of the courts upon this branch of the law has arisen, as it seems to me, not from any doubt or diversity of opinion in relation to the effect of an instrument under seal clearly expressing a .discharge of one joint obligor in consideration of a sum less than the entire obligation or liability and a reservation of the remainder of the liability against the other obligor, but from a construction of the nature and effect of the various agreements and transactions between one or more joint obligors with the obligee, whether the agreement or transaction shall be held as a full satisfaction of the obligation as to . all the obligors or a satisfaction in part and a release of less than all the obligors, or a covenant not to sue one or more of the obligors or whether the instrument affords a presumption of a full satisfaction and discharge of the obligation or whether sufficient in force and dignity to discharge the original obligation. The acts of the Legislature from time to time and as expressed in section 1942 Code of Civil Procedure, are in line with the decisions as respects joint debtors, and under it the presumption is that only the compromising creditor is discharged.

Of the correctness of the decision of the court below in respect to the office and effect of the instrument given to Moffat by the obligees or beneficiaries of the bond I think there can be no doubt.

The next question to be considered relates to the-remedy by which the plaintiff seeks to maintain her right against Hayward. The general rule is that a party must resort to a remedy prevailing at the time the action is commenced to enforce his right. The defendant contends that it was necessary, before bringing this action to recover against the surety upon an executor’s bond, that the proper surrogate should have made a decree against the executor, and that an execution should have been issued to collect the sum specified in the decree, and that the execution should have been returned unsatisfied in whole or in part.

It is found by the trial court that no such execution had been issued or returned. It will also be borne in mind that the proper surrogate had made a decree or order directing the executor Hood to pay the plaintiff the sum of $29,100 on account of a loss through mismanagement and revoking his appointment as executor and later made an order granting leave to sue on the bond.

“ In all the cases of actions on bonds of executors and administrators, a compliance with the statutory formalities has been regarded as essential to the maintenance of an action against the sureties.” Hood v. Hood, 85 N. Y. 561-574. All the statutory prerequisites for the commencement of actions upon the bonds of executors and administrators were abolished by Chapter 245 of the Laws of 1880, and the provisions contained in the Code of Civil Procedure were adopted in their stead. The orders or decrees of the surrogate revoking the letters testamentary to Frederick Hood and directing the payment of the sum of $29,100, the loss by his misconduct to the estate of the testator, to the plaintiff, and granting leave to her to bring an action upon the bond, were made subsequent to the change of the laws relating to the bringing of actions upon such bonds. The laws applicable to that subject are to be found in sections 2607, 2608 and 2609 of Code of Civil Procedure. Section 2607 provides : “ Where an execution issued upon a surrogate’s decree, against the property of an executor, administrator, testamentary trustee, or guardian has been returned wholly unsatisfied, an action to recover the sum remaining uncollected, may be maintained upon his official bond, and in the name of the person in whose favor the decree was made. If the principal debtor is a resident of the State, the execution must have been issued to the county where he resides.”

This section manifestly embraces all cases where an order or decree is made by the surrogate for the payment of money by the executor or administrator as formerly existed under the provisions of the revised statutes and chapter 460 of the laws of 1873 and perhaps other statutes upon that subject.

The proceeding under this section is based upon a judgment or decree against the executor or administrator for the payment of money and the issuing of an execution for its enforcement, and the failure of its accomplishment before an action can be brought upon the bond of his sureties. Under that provision it is not now requisite that an order be made by the surrogate granting leave to prosecute the bond or assigning the bond for that purpose.

It is sought to obviate this objection and to maintain the action upon section 2608 which provides that “ Where letters have been revoked by a decree of the surrogate’s court the successor of the executor, administrator or guardian, whose letters are so revoked, may maintain an action upon his predecessor’s official bond, in which he may recover any money, or the full value of any other property, received by the principal in the bond, and not duly administered by him ; and to the full extent of an injury, sustained by the estate of the decedent or of the infant as the case may be, by any act or omission of the principal. The money recovered in such an action is regarded as part of the estate in the hands of the plaintiff, and must be distributed or otherwise disposed of accordingly ; except that a recovery for an act or omission, respecting a right of action,, or other property appropriated by law for the benefit of the husband, wife, family, or next of kin of a decedent, or disposed of by a will for the benefit of any person, is for the benefit of the person or persons so entitled thereto.” But it seems to me that cannot, be done with a proper regard thereto of the plain language of the provision and the scheme contained in sections 2607, 2608 and 2609.

As before stated, section 2607 does and is intended to embrace all cases where there is a decree against the executor for the payment of money. The money is to be collected by the ordinary process of execution if practicable before resort can be had to the bond of the sureties. In this case the basis of the action is the decree which plaintiff (after revocation of the letters to her co-executor, Frederick Hood) had been granted and such decree was the only evidence of the loss which the estate had sustained and was the measure of such loss. Section 2608 has application, only to a different class of cases, to cases where the letters have been revoked by the surrogate as to all executors or administrators, and where a successor has been appointed, and section 2609 to a case where the letters have been altogether revoked, and no successor has been appointed. The language used and the scheme of those sections forbid such a construction of them.

A successor is one who follows another into a position, and not one who went into the position with and survives such other in the position after it has been vacated by such other. Other sections of the code are only consistent with this construction of section 2608 and 2609. Section 2605 provides “. . . the successor may complete the execution of the trust committed to his predecessor.” “ The surrogate’s court has the same jurisdiction upon the petition of the successor or of a remaining executor . . to compel the person whose letters have been revoked to account . . . . ” as was done in this case.

It is provided by section 2692 “ Where one of two or more executors or administrators dies, or becomes a lunatic, or is convicted of an infamous offence, or becomes otherwise incapable of discharging the trust reposed in him, or where letters are revoked with respect to one of them, a successor to the person whose letters are revoked shall not be appointed, except where such an appointment is necessary, in order to comply with the express terms of a will, but the others may proceed and complete the administration of the estate, pursuant to the letters, and may continue any action or special proceeding brought by or against all.”

And by section 2693 it is provided that “ When all the executors or all the administrators to whom letters have been issued, die or become incapable, as prescribed in section two thousand six hundred and ninety-two, or the letters are revoked as to all of them, the surrogate must grant letters of administration to one or more persons as their successors, in like manner as if the former letters had not been issued, and the proceedings to procure the grant of such letters are the same, and the same security shall be required, as in case of intestacy, except that the surrogate may in his. discretion, in case where the estate has been partially administered upon by the former representative or representatives, fix as the penalty of the bond to be given by such successor or successors a sum not less than twice the value of the assets of the estate remaining unadministered.”

Besides, the tenor and design of section 2608 prescribe what is to be done by the successor. A surviving executor is already charged with those duties, and there is no. occasion to re-charge him. Section 2609 is intended for a case where the letters have been revoked and no successor - has been appointed. In the latter case any person aggrieved may obtain from the surrogate leave to prosecute the bond given by the executor whose letters have been revoked, and the duties cast upon such person are conferred in the same language as the duties cast upon the successor under section 2608. And it may be remarked in considering section 2609,. that it alone presents a case where the surrogate has-any occasion to grant leave to sue the executor’s bond-under existing laws.

I am reluctantly constrained to the conclusion that, the omission to issue execution upon the decree against the executor is fatal to the maintenance of this actions against the defendant Hayward, surety upon the bond in suit, for I have an impression that the issuing of an execution against the executor Hood, a non-resident of this State, would have proven a fruitless ceremony.

If the conclusion in relation to the objection that an execution should have been issued and have been returned unsatisfied in order to maintain this action is correct, the appeal must result in a new trial, and there is not any necessity or perhaps occasion to discuss the question of the amount of interest involved in the cross-appeal. But as I have discussed the question of the effect of the release of Moffat, notwithstanding my conclusion that a new trial is necessary, it may not be -amiss to indicate, but without deciding it, the impression of the court upon the subject of the extent of the ■interest recoverable upon the bond of the surety in suit.

As appears from the case, the letters of the executor, "Frederick Hood, were revoked December 27, 1883 ; ;and the court below has allowed interest upon $10,000, ¡one-half of the penalty of the bond and the limit of Hayward’s liability, I am of the opinion that the allowance of interest from that date was erroneous. The decree revoking the letters did not necessarily or judicially determine the amount or extent of the loss to the estate arising from the misconduct of the executor ■whose letters were revoked.

A revocation of letters may be granted for various -grounds of misconduct of the executor, and among ' those grounds are investments made by him in securities not authorized by law or in violation of the decree or order of the surrogate, and regardless of the sum so •misinvested. Section 2865, Code of Civil Procedure. It appeared incidentally from the order of revocation that the executor had misinvested at least the sum of $29,100, of the sum of $53,710.69, which he was directed to invest by. the decree of the surrogate dated January ■6, 1869. Upon an accounting by the executor subsequent to the decree revoking his letters, upon the petition of the plaintiff as executrix, praying for an accounting for the moneys received by him on July 31, 1883, whereby among other things he disallowed the said investment of $29,100, and ordered and directed that •such sum, together with the further sum of $2,675, .amounting in all to the sum of $31,775, be paid by said Hood to the plaintiff.”

This is the period -at which the amount of the loss to the estate by the misconduct of the executor and the liability of the defendant as his surety was adjudicated, and the executor was on that day directed by the order of the surrogate to pay the amount to plaintiff.

The executor upon demand of payment of that sum failed to pay it or any part of it. It seems to me very plain upon principle that the interest should begin to run from the date of the last named decree. On that day for the first time was the breach of the bond adjudicated, and the amount of damages resulting therefrom liquidated (Mansfield v. N. C. & H. R. R. Co., 114 N. Y. 331).

While there was formerly some contrariety of decisions in respect to allowing interest to be added to the penalty of the bond, or, more accurately speaking, ■of allowing the damages to be added to the penalty for withholding it after it was due, I think now it may be regarded as settled law that interest or damages may .be added to the penalty from the date at which it is determined there has been a breach of the condition of the bond.

In case the condition of the bond is the payment of money on a day certain, the interest or damages will begin to run from that date, and in case the condition pf the bond is that an act shall be performed, the interest or damages will begin to run from the date that it is adjudicated by a competent court that the act has not been performed, and liquidating and fixing the damages caused by such non-performance. The bond in- suit belongs to the latter class. It is necessary in this class of bonds that the complaint should allege the act that was not performed, prove the allegation and the damages occasioned thereby (Beers’ Exrs. v. Shannon, 73 N. Y. 292-302).

The decree was the evidence of all this and the equivalent of a bond conditioned to pay a particular sum of money upon a day certain, and this court has held that an action cannot .be maintained against. the-surety upon an executor’s bond until an accounting has been had and a decree rendered (Hood v. Hood, 85 N. Y. 561; Haight v. Brisbin, 100 N. Y. 219).

When the amount of the liability in money has been fixed by the decree it becomes a debt, and like a bond conditioned to pay a specific sum of money, and the withholding of its payment will create a liability to pay the damages estimated by law to be equal to the legal rate of interest (Williams v. Wilson, 1 Vt. 266 ; Perit v. Wallis, 2 Dall. 22 ; Carter v. Carter, 4 Day, 30; 2 Am. Dec. 113; Smedes v. Houghtailing, 3 Caines, 48; 2 Am. Dec. 230; Brainard v. Jones, 18 N. Y. 35; United States v. Arnold, 1 Gall. 348; Harris v. Clapp, 1 Mass. 307; 2 Am. Dec. 27; Wyman v. Robinson, 73 Me. 384 ; 40 Am. Dec. 360); and I think it was upon this theory of the law that section 1915 of the Code of Civil Procedure was adopted upon this subject.

My conclusion is therefore that if the plaintiff is entitled to recover in this action, she can only recover besides the one half of the penalty, damages or interest' from the date of the decree, which was July 31, 1885, and this difference may upon this appeal be deducted and the judgment corrected, if the views in relation to' the necessity of issuing execution are not concurred in.'

A brief consideration of the defenses of counterclaim and the statute of limitations will suffice.

The action is brought by plaintiff as executrix, a trustee. The alleged counterclaim sets forth no facts except possibly the fact that the plaintiff, as such executrix, acted with Hood, executor, in the management of the assets and property of the estate, and the legal conclusion therefrom that she is jointly liable with the executor for loss and waste. It is not alleged in the counterclaim that the respondent ever had any individual interest in the estate, or if she had, that it continued to exist at the time the loss was made by the investment. As executrix and trustee for others she may maintain this action notwithstanding any complicity with the misconduct of the executor, and any cause of action against her individually cannot form a counterclaim against her as the trustee for others; (Wetmore as Exr. v. Porter, 110 N. Y. 605 ; Boyle v. St. John, 28 Hun. 455 ; sub. 3, § 502, Code of Civil Procedure).

The allegation seems to me wholly inconsequential, and. would not constitute a defense ora basis for affirmative relief if it was admitted for want of a demurrer or reply to be true, for the omission to demur or reply will not impart a cause of action or a defense where none was contained in the preceding pleading. But in this case the trial court refused to find upon defendant’s request, that the plaintiff had any possession of the fund or any knowledge of its investment, until after the loss had been incurred, and the evidence in the case was such as to make such refusal necessary.

If the view I have taken above of the time when the -cause of action matured and the defendant became liable to pay interest upon one-half of the penalty named in the bond, is correct, that disposes of the ■defense of the statute of limitations.

I think the judgment should be reversed and a new trial ordered with costs to abide the event.

By the Court, Bradley, J.

In 1864, the will of Andrew Hood, deceased, was admitted to probate, and letters testamentary were issued to the plaintiff and the defendant, Frederick Hood ; and the latter, being a non-resident of this State, gave bond in which the defendant Hayward and David Moffat joined as sureties. The executor, Hood, was afterwards charged with devastavit, and in 1883 his letters were revoked. On July 31, 1885, in a proceeding before the surrogate instituted by petition of the plaintiff, a decree was made directing him to pay to her as such executrix the sum of $31,100. This action was afterwards brought upon such bond. And the objection is taken that it cannot be maintained, because no execution was issued upon such decree and returned wholly or partially unsatisfied. The disposition of this question is dependent upon the statute by which such remedy is regulated' {Code Civ. Pro. §§ 2607, 2608, 2609). Those sections provide for three classes of actions upon the official bonds of executors and administrators: x. Where an execution issued upon a surrogate’s decree against the property of an executor or administrator has been returned wholly or partly unsatisfied, an action to recover the sum uncollected may be maintained upon such bond, by and in the name of the person in whose favor the decree was made (§ 2607). 2. Where letters have been revoked, the successor of the executor or administrator, whose letters are revoked, may maintain an action upon his predecessor’s bond, in which he may recover any money or the value of any other property received by the principal, and not duly administered by him; and to the full extent of any injury sustained by the estate of the decedent. And the money recovered is regarded as part of the estate in the hands of the plaintiff, and must be distributed or otherwise disposed of accordingly (§ 2608). 3. Where the letters are so revoked, and no successor is appointed, any person aggrieved may, upon obtaining leave by order of the surrogate so to do, maintain an action on the bond in behalf of himself and all others interested. And the money so recovered must be paid into the. surrogate’s court for distribution. (§ 2609.)

These are distinct remedies, and each of them is. independent of the others. They were designed to take the place of those given by prior statutes on the. subject. Formerly the right to bring actions on such bonds was subject to the direction of the surrogate, or was dependent in the case provided for it of an assignment by him of the bond to the person in whose favor a decree was made. When an executor or administrator refused or omitted to perform a decree made against- him for rendering an account or upon final settlement, the surrogate might cause the bond to be prosecuted. (Laws 1830, ch. 320, § 23, 2 R. S. 2d ed. 53, § I9-) The provisions of § 2607 are a substitute for § 65, ch. 460, Laws 1837, which provided that after the return of an execution unsatisfied, the person in whose favor the decree upon which it issued was made, might have a right of action upon assignment of the bond to him by the surrogate. The present statute dispenses with the formal act of assignment. And the provisions of §§ 2608 and 2609 seem to be somewhat broader in their import than were those of the former statute, which provided for the prosecution of the bond of an executor or administrator whose letters had. been revoked. Then it was done by the direction of the surrogate. (2 R. S. 85, § 21.) The actions under such prior statutes other than that of 1837, were prosecuted in the name of the people. Those statutes are referred to in view of the proposition before asserted that the present remedies are distinct and independent of each other as were those formerly existing (People v. Gould, 4 Denio, 551);

The support of an action under § 2607 is dependent upon the return of an execution unsatisfied. That is not requisite for the purpose of actions within the provisions of the two sections following it. This action does not come within § 2609. The question arises whether it is supported by the provisions of § 2608. And that is mainly dependent upon the fact whether the plaintiff is the successor of the one whose letters were revoked. When her associate was retired from it, the entire trust was devolved upon her. She succeeded to and necessarily assumed all the powers and duties with which he had been vested and charged as an executor; and in that sense she was his successor. There is apparently no reason for denying to her that relation for the purposes of the remedy in view, unless the statute requires a construction which defeats it. The purpose of the statute giving the right of action to the successor of an executor or administrator whose letters are revoked, is to indemnify the estate of the decedent against loss so far as the means afforded by the official bond of the defaulting representative and the remedy founded upon it will permit. It not only "seems that the appointment, if authorized, of a successor to the one of two whose letters have been revoked, would be useless for the accomplishment of that purpose, but such supply of another in that manner in his place is not permitted except when necessary "to comply with the express provisions of a will. The statute contemplates that, except in such case, the survivor will perform all the duties of the trust (Code §2692). And, with that exception, it is only when all the executors or administrators die or become incapacitated, dr the letters of- all of them are revoked, that letters will be granted to one or more persons, as their successors ild. § 2693). It follows that unless the survivor may be treated as a successor within the meaning of the statute, the provisions of § 2608 cannot be made applicable to an action upon the bond of one of two or more executors or administrators whose letters have been revoked; and that the remedy upon his bond, when -there is a survivor, is dependent solely upon the provisions of § 2607. That section provides for an action by the person in whose favor is made a decree against an executor or administrator after the return of an execution unsatisfied. The decree in the present case was not against such an officer, but was made pursuant to the statute providing that upon the petition of the successor or of the remaining executor or administrator, the surrogatemay compel the person whose letters have -been revoked to account for or deliver over money or ■other property and to settle his account {Id. § 2605). It has, however, been held in Sperb v. McCoun, 110 N. Y. 605, that in such case an action may be maintained under § 2607, when an execution has been issued ■on such decree and returned unsatisfied. It does not follow from the determination of that case that the present one cannot be supported. Nor does the view in that case necessarily preclude the application of the provisions of § 2608 to the cause of action alleged in this case, and to its determination by the trial court as represented by its findings of fact. For the purposes of an action upon the bond of an executor whose letters have been revoked, the issue of execution upon a decree and its return unsatisfied, are not requisite to its maintenance. Nor does the application of the provisions of the statute in that respect seem by its terms or by reasonable implication to be confined to those cases where no survivor remains to proceed with the execution of the trust; and in that view, inasmuch as the statute imposes its performance wholly upon the latter, the remedy upon the official bond of him whose letters are revoked is entirely with such survivor. And to ■.hold that the latter is not a successor within the meaning of the statute, is to deny any remedy under the provisions of the section last mentioned. No definition of the term successor ” is given in the statute. There-is, in other sections of it upon the subject under consideration some language used importing its application to a person who receives an appointment in place of one who has been retired from the position of the trust. But it is not so restricted by anything in § 2608. And, although by a process of reasoning the application of some provisions of other sections may be so made as to give to the word successor such restricted meaning that construction is not within the evident spirit and purpose of the statute.

The view here taken is that when the plaintiff' became the sole remaining executor, she, for all the purposes of the trust, was the successor of the one who had been removed, as she succeeded to all the powers, before then vested in him in his relation to the estate of the decedent, as effectually as they could be taken by one appointed in his place if such appointment were permitted and had been made. And this action was. brought solely for the benefit of the estate, to bring to it a fund to reimburse it pro,,, tanta for the loss it had suffered by the breach of trust of the principal in the bond while he was executor, and in violation of the order of the surrogate. Such money when collected is part of the estate, and to be distributed and disposed of under the direction of the surrogate. That is the purpose of an action and recovery under section 2608. And. these views lead to the conclusion that this action is within the provisions of that section.

In respect to the other questions the conclusions of Judge Potter are adopted to the effect that the lease-of Moffat did not discharge the defendant Hayward from his liability to the extent of a moiety of the obligation assumed by those persons upon the bond ; and that the plaintiff was entitled to recover interest, only from July 31, 1885.

The judgment should, therefore, be modified by deducting from the recovery interest upon $10,000, from Dec. 7, 1883, to July 31, 1885, and as so modified affirmed.

All the judges concurred except Follett, Ch. J,, not voting, Potter, J., who dissented and read the-opinion first above given, and Haight, J., absent.

Note on the necessity of an accounting as a preliminary TO SUING ON THE BOND OF AN EXECUTOR, ADMINISTRATOR, ADMINISTRATOR WITH THE WILL ANNEXED, TEMPORARY ADMINISTRATOR, GUARDIAN, RECEIVER OR TESTAMENTARY TRUSTEE,

As a general rule no action lies against the sureties in a bond conditioned in substance like the usual bonds of executors, administrators, guardians, etc., except in case of disobedience by the principal of some order of the surrogate, or other proper court. Per Potter, J., in Perkins v. Stimmel (114 N. Y. 359, 367), applying to guardian’s bonds the same rule applied in Hood v. Hood (85 N. Y. 561), to executors’ bonds, and in Haight v. Brisbin (100 Id. 219), to the bond of an executor and testamentary trustee and in Bieder v. Steinhauer (15 Abb. N. C. 428), to a guardian’s bond.

The same rule applies to a receiver’s bond (French v. Dauchy, 57 Hun, 100 ; s. c. 32, State Rep. 544, 10 N. Y. Supp. 468).

If the principal is deceased, his administrators may in the absence of any allegation to the contrary, be presumed to be in possession of the assets ; and without an allegation, that they are not, there must be an accounting before suit against the sureties (Perkins v. Stimmel, 114 N. Y. 359), overruling on this point (42 Hun, 520).

The possession of Code. Civ. Pro. § 814, authorizing ah action for breach of the condition of a bond given in the course of an action or special proceeding—has no application to the bond of an executor, who is claimed to be liable for damages for misconduct in failing to sell real estate as directed by the will, where such liability has not yet been established by proceedings before the surrogate (Haight v. Brisbin, 100 N. Y. 219 ; rev’g 36 Htm, 579, which aff’d 1 How. Pr. N. S. 199 ; 7 Civ. Pro. R. 152).

The sureties ordered to be charged personally, are liable-for the costs and disbursements of a proceeding revoking-the letters (West v. Crosby, 2 City Ct. 305).

Whether the sureties of an executor insolvent at the-time of his appointment are liable for a debt due from him to the testator, under 2 R. S. 84, § 13, providing that an executor shall be liable for a debt so due, as for so much money in his hands,” query (Baucus v. Stover, 89 N. Y. 1 ; rev’g 24 Hun, 109).

It seems that in case of a default which the surrogate had no jurisdiction to redress, the remedy of the party injured would be in equity to charge the executor, instead of at law upon his bond (Haight v. Brisbin, above cited).

A surety of a guardian, though sued on the bond after decree rendered by the surrogate against his principal, has been held to have no standing in the surrogate’s court to move to open the decree (Smith v. Lusk, 2 Dem. 595 ; Corbin v. Westcolt, 2 Id. 559). Whether this rule is sound, or applies to the bond of an executor or administrator, compare (Deobold v. Opperman, 111 N. Y. 531, aff’g 4 State Rep. 514).

And in the last named case it was held that it is no defense to the sureties upon an administrator’s bond that a decree which had- been entered discharging the administrator and his sureties, was afterward, without notice to the sureties, set aside for fraud in its procurement, although it appears . that the sureties relying upon the original decree so set aside, have parted with indemnity received by them from the administrator, where such indemnity consisted of the funds of the estate deposited with the sureties'to secure their liability upon the bond. 
      
      See for this statute and cases under it, 23 Abb, N. C. 194.
     
      
       See the language of this section on p. 273 above.