Case ID: mills-surr_1/html/0443-01.html
Source: Caselaw Access Project
Author: {"author": "Ingalsbe, S.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Matter of the Judicial Settlement of the Accounts of J. Melvin Adams and Mary A. Cossey, as Administrators, etc., of William Cossey, Deceased.
    
      (Surrogate's Court, Washington County
    
    
      Filed December, 1899.)
    Executors and Administrators — Liability of a Cosurety on an Administration Bond to Another Surety and Sole Distributee.
    Where an illiterate administratrix permits her coadministrator, a banker, to control the entire administration of the estate, sureties, on the official bond of both, are liable to the administratrix, as sole distributee, for moneys of the estate which the administrator deposited in his own private bank and kept there during a whole year when he was insolvent, and until his bank failed upon his making a general assignment.
    Proceedings upon the judicial settlement of the accounts of administrators.
    L. H. bTorthup, for administrator Adams; Potter & Lillie, for administratrix Cossey; C. H. Sturges, for sureties Orson. W. Sheldon and John Main.
   Ingalsbe, S.

The administratrix Cossey is the widow of the decedent, and by various assignments is entitled to the entire distributable estate. Her coadministrator Adams was the sole proprietor of a private bank, called the John Hall & Company Bank at Port Ann. The contention in this matter is made by the sureties Orson W. Sheldon and John Main. They claim, inasmuch as the administratrix Mary A. Cossey is the sole distributee of the estate, that the sureties cannot be obliged to make good the loss incurred through the failure of Adams to pay over the estate moneys which were in his private bank at the time of its failure.

Letters of administration herein were issued September 5, 1896. At that time the decedent had $300 on deposit in the John Hall Bank, and a considerably larger amount, together with securities to be converted into money, in a Brooklyn bank. Adams took entire control of the estate. He transferred by check at different times over $2,000 from the Brooklyn bank to his private bank, where he deposited it in his own name as administrator. This bank failed August 2, 1898, Adams making on that day a general assignment for the benefit of creditors. For a year previous to that time he had been insolvent.

The evidence shows that Mrs. Cossey was an illiterate woman; that she could neither read nor write, and that she had no knowledge of business matters. She had entire confidence in her coadministrator, and trusted him implicitly. Adams assumed the entire management of the estate. Mrs. Oossey was not consulted, and the only thing in connection with its management that she ever did was that she once told Adams to let the money which was in the Brooklyn bank remain just as it had been.” She had no knowledge that Adams was insolvent. He had the confidence of the community in which Ms bank was located, and its prominent business men were depositors at the time of the assignment.

An administrator in executing his official bond does not become the surety of a coadministrator. Administrators may act together or separately. They are jointly liable for joint acts and separately responsible for their separate acts. A surety upon a bond having two or more principals becomes liable, however, not only for their joint acts, hut for the separate acts of each.

If Mrs. Cossey had had sole charge of this estate, the evidence in the case would not charge her with any liability on account of the money deposited in the John Hall & Company Bank. In so depositing money she would have been doing -only what prudent, capable and experienced business men, living in the same community, were doing. With Adams a different rule prevails. While he was considered to be a man •of integrity and responsibility, he knew of his financial condition, and that for a year before the doors of his hank closed he was insolvent.

The sureties say that they are not responsible for losses incurred through Adams, for the reason that his coadministrator is the sole distributee here. The case of Nanz v. Oakley, 120 N. Y. 84, was in this respect similar to the one we are considering. That was an action upon an administrator’s bond. Thére were two administrators, one of whom was the sole next of kin of the decedent. The other administrator took entire charge of the estate and converted it to his own use. The action was brought against a surety by the representative of the deceased next of kin and administrator. Counsel urged the principle, that a person by his own transgression cannot create a cause of action in his own behalf against another. The court, however-, did not consider it applicable and held that the action could be maintained. Had Mrs. Cossey acted jointly with her coadministrator this principle could be invoked, but she did not so act. Throughout his administration of the estate, Adams acted separately and alone, and for his acts the sureties on his bond are clearly responsible.

A decree should be entered directing Adams to pay over the balance remaining in his private bank on deposit to the credit of the estate, at the time of his assignment, together with the interest thereon, and that the sureties pay the costs of the proceeding commenced by them.

Decreed accordingly.