Case ID: sc-eq_7/html/0519-01.html
Source: Caselaw Access Project
Author: {"author": "Nott, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Mary Rowland and Others v. Elizabeth Best, Executrix of Benajah Best, Deceased.
    Where the defendant had come into possession of funds bona fide under an administration which was many years after revoked, the court would not compel the defendant to account for interest further back than four years before the filing of the bill. A parly who lies by and suffers another to occupy and enjoy property or funds as his own under an apparent and bona fide good title which he might have brought into discussion much earlier, will be restricted in his demaud for an account to the time of his demand, or to four years before the filing of his bill. The rule for calculating interest on accounts, against persons iu a fiduciary situation, is to allow interest on the annual balances, but not to be compounded.
    The original bill in this case, filed 23d of July, 1822, against Bena-jah Best, stated that the complainants were the next of kin of Elizabeth Purvis, late of Barnwell ^district, deceased. That Elizabeth Purvis was, in her lifetime and at the time of her death, possessed of personal estate of about the value of two thousand dollars, and some time in the year 1807 departed this life intestate, whereupon her estate became distributable among the complainants as the next of kin. That on the 22d of August, 1807, Benajah Best, pretending that the said Elizabeth Purvis had made and duly published a will in his favor, made an ex parte application to, and obtained from the ordinary of Barnwell district, letters of administration with such pretended will annexed, possessed himself of her estate, and has ever since used the same as his own property. That the complainants had made application to the said Benajah Best for an account of the estate, and for him to pay and deliver the same to them. And although the ordinary of Barnwell district did, on the 28th of June, 1823, adjudge and decree that Elizabeth Purvis died intestate, and did also by his decree revoke the said letters of administration, yet Benajah Best refused to render any account of his administration, or to pay and deliver the estate to the complainants, pretending that Elizabeth Pur-vis was at the time of her death insolvent, and that her debts had exhausted the estate, which pretences the complainants charged to be untrue, and prayed that the defendant might come to a fair and just account touching the estate, and pay and deliver the same to them.
    On the 9th of November, 1824, Benajah Best filed his answer, and admitted that Elizabeth Purvis died in July, 1807; that believing she had made a valid nuncupative will bequeathing her whole estate to him, he proved the same in the court of ordinary soon after her death, and received letters of administration. That the administration had been revoked by the ordinary, and Elizabeth Purvis declared to have died intestate; and that a person representing himself to be the agent of the complainants* demanded a settlement; but whether the complainants were the next of kin to Elizabeth Purvis he was ignorant, and therefore refused to come to any account. The defendant also alleged that the estate was involved in debt and litigation which he was obliged to pay off and sustain. He was ready to account if complainants proved themselves the next of kin of Elizabeth Purvis ; but insisted that, from all the circumstances, the account should not be carried further back than from the time of the demand.
    Benajah Best having departed this life, the case was revived against Elizabeth Best his representative; and the matters of account were referred to the commissioner, who reported the sum of §1,709 15j cents as due to the complainants.
    To the commissioner’s report the defendant excepted.
    First. Because the account ought not to have been carried back further than the filing of the bill, or at most, no farther than four years before the filing the same.
    Secondly. That upon the principle on which the report of the commissioner is founded, it gives the complainant interest upon interest; whereas the true mode of computing it was to strike an annual balance, and calculate the interest upon that balance for one year, deducting every year the credits from the principal and keeping a separate interest account, and at the end of the account add the sum total of interest to the balance of principal.
    DeSaussure, Chancellor. This case comes up on the report of the commissioner, and exceptions thereto.
    The first exception is because the account ought not to be carried further back than the filing of the bill, or at most no further than four years before the filing of the *same. This exception rests upon the ground that by a nuncupative will, established by the ordinary in 1807, the property was decided to belong to Benajah Pest, and he occupied and enjoyed it accordingly till the year 1823, when the will was set aside by the ordinary and the bill was filed for an account. This is a hard case on the family of Benajah Best, and I am inclined to think, though not without much hesitation, that the account ought not to be carried back further than four years before the filing of the bill. It is not an uncommon case for a party, who lies by and permits another to occupy and enjoy property or funds as his own, under an apparent good title which he might and ought to have brought into discussion much earlier, to be restricted in his demand for an account of rents and profits or interest, to the filing of the bill or four years before. In the present case the party lay by from 1807 to 1823. It would be hard on the family of Best, after his death, to carry the account for interest further back than four years before the filing of the bill, or to the death of Benajah Best. It is therefore ordered and decreed that the account be limited to the period of four years before the filing of the bill. The cases, in relation to the time when the account of rents and profits or of interest should commence, are very various and perhaps somewhat discordant. On examining them it would appear, that where the possession was not obtained or held by fraud, but fairly, on a title apparently good — afterwards found to be defective, and especially after the death of the holder, when his family may not be able to make out or substantiate the accounts by vouchers, it is not proper to carry back the account further than four years from the time of filing the bill. Indeed in Hercy v. Ballard, 4 Bro. C. C. 468, the account was restricted to six years in consideration of the application of the statute of limitations. And in Read v. Read, 5 Ves. *744, the account of rents was confined to six years by analogy to an action for mesne profits.
    The second exception relates to the mode of calculating interest on the annual balances. The rule is to allow interest on the annual balances, but not so as to allow compound interest. It is very easy to make up accounts in that way, as stated in the second exception; and it is ordered to be done accordingly.
    From this decree the defendant appealed ; because the complain ants were barred by lapse of time, and that the account should have been restricted to the time of the demand.
    The complainants also appealed on the grounds—
    
      First. That they were entitled to interest on the amount in the hands of the defendant or the testator, after allowing a reasonable time for the settlement of the estate.
    
      Secondly. That the rule of law on the subject of calculating interest, is to deduct the expenditures for the first year from the funds in hand on the first day of the year, allow interest on the balance, and add it to the principal at the end of the year. On the first day of the second year deduct the disbursements of that year from the amount of principal and interest thus added together, calculate interest on the balance, and so on from year to year.
    
      Thirdly. That wherever the trustee has used the fund, interest ought to be allowed on the annual balance of the principal and interest.
    
      Fourthly. That by the decretal order the defendant ought to have heen made liable for the costs.
    Martin, for the complainants
    cited 3 Johns. Cha. Rep. 190, 208. Bonnyta Ridgard, cited in4 Burr. 130, *138. 17Ves.97. Andrews v. Wrigly, 4 Bro. Cha. Rep. 125. Beckford v. Wade, 17 Ves. 87. L Kane v. Bloodgood, 7 Johns. Cha. Rep. 90. Dormer v. Fonescue, 3 Atk. 130. S. C. Cas. Temp. Hard. 183. Pettiward v. Prescott, 7 Ves. 540. Pulteney v. Warren, 6 Ves. 73. Green v. Biddle, 8 Wheat. Rep. 1. 4 Bro. C. C. 521. Harmood v. Oglander, 6 Ves. 199. 10 Ves. 468, 476. Bond v. Hopkins, 1 Sch. & Lef. 428. Hovenden v. Lord Annesly, 2 Sch. & Lef. 624. 5 Ves. 744. Costs are not subjects of appeal. Harp. Eq. Rep. 260. Eastburn v. Kirk, 2 Johns. Cha. Rep. 317. 1 Johns. Cha. Rep. 166. 1 Johns. Cha. Rep. 77. 2 Johns. Cha. Rep. 274. 4 Johns. Cha. Rep. 419. 5 Johns Cha. Rep. 441.
    Pattison, for the defendant,
    cited Ashburnham v. Thomson, 13 Ves. 303. Raphael v. Boehm, 13 Ves. 408. Scheiffelin v. Stewart, 1 Johns. Cha. Rep. 620. As to costs, he cited Seers v. Hind, 1 Ves. Jun. 294. Piety v. Stace, 4 Ves. 620. Roche v. Hart, 11 Ves. 60. Moseley v. Ward, 11 Ves. 581. Manning v. Manning, 1 Johns. Cha. Rep. 536.
   Curia, per

Nott, J.

I should have been better satisfied in this case, if interest had been allowed only from the time of the demand. But as the chancellor had all the testimony before him perhaps he had a better opportunity of judging of the matter. In all other respects I ain satisfied with the decree. I have, therefore, upon, the whole concluded to concur with the chancellor.

Decree affirmed.