Case ID: sc-eq_22/html/0031-01.html
Source: Caselaw Access Project
Author: {"author": "Caldwell, Ch.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Wm. Holmes, administrator of Elnathan Davis, v. William Logan.
    
    Columbia,
    
      May, 1849.
    The general rule Is that a guardian shall not exceed the annual income of his ward’s estate in expenditures.
    When the charges in the accounts of a guardian exceed the annual income of his ward’s estate, lie must make out, cd, least, as clear a case before the Court for the subsequent sanction of his expenditures, as he would have been required to do on an application for its authority to malte them.
    
      Before Johnston, Ch. at York, June, 1848.
    Johnston, Ch. — This case comes up again on report and exceptions. Amos Davis ivas the guardian of Elnathan Davis, the plaintiff’s intestate, and the defendant Logan was one of the sureties to his bond.
    The guardian and ward having died, the bill was brought by the administrator of the latter against the guardian’s surety, for an account of the guardianship. The sureties pleaded in bar to the account, that there had been a settlement between the guardian and ward, and that the former paid over what he owed the latter. At the hearing in June,
    1846, it was proved to Chancellor Johnson’s satisfaction that the settlement, &c. which had been repeatedly admitted by the ward in his lifetime, took place shortly before he attained majority. The Chancellor, therefore, overruled the plea, and ordered an account.
    The Commissioner filed a report the 27th of June, 1846, in which he stated that the payments purporting to have been made by the guardian, as shown by his settlement, were all admitted to have been made as stated in the guardian’s returns, and strict proof of payment or production of vouchers, was not insisted on by the Solicitors for complainants.
    The Commissioner in his report, however, had allowed the payments by the guardian, thus charged in his returns, so far as they exceeded the income of the ward’s estate. To this report the defendant put in several exceptions, most of them, in substance, insisting that the breaking in upon the capital of the ward was occasioned by his education and necessary maintenance. Chancellor Johnson observed in his decree upon the exceptions, July, 1846, “ the principal charges against the ward in his account, are for board, tuition, and merchant’s accounts, (no doubt for clothing.) The admission of complainant’s intestate, that he had settled with his guardian and received his share of the estate, had reference no doubt to his accounts returned to the Commissioner, and furnish, I think, satisfactory evidence of the bulk of the charges, and the facts of the disbursement, but they are not , evidence of their necessity and propriety, because he was an J infant when they were made.” He proceeds to say, “ That boarding, clothing and education, to a limited extent, was necessary, does not admit of a question — but the reasonableness of the sums expended on this account, can only be ascertained by proof of what they would cost on an economical scale. The report is, therefore, recommitted to the Commissioner — and in restating the accounts he will charge the guardian with the sum in his hands, to which the ward is entitled, with interest on it, annually, from the time at which it was payable; and at the end of each year, deduct from the aggregate amount what he shall find to be reasonable allowance for board and clothing, as also any sum he may ascertain to have been paid for the tuition. Carrying the computation down to the time when the settlement is said to have been made between them, which is ascertained to have been at the time the guardian sold his property, with the view of removing to Alabama.”
    On the reference which subsequently took place, the Commissioner, instead of confining himself to an inquiry what was a reasonable allowance for board, tuition, &.c. in the years charged in the guardian’s returns, which had been admitted in the settlement, and also on the previous references, received evidence controverting the fact that the guardian had paid the sums, or furnished the board thus previously admitted, and which the Chancellor had ruled to be established by satisfactory evidence.
    And he has reported in the alternative, one of which alternatives is, that the account be reduced according to the evidence thus admitted by him.
    The plaintiff has excepted, because he should have reported absolutely that the account should be thus reduced, and not in the alternative.
    I hold that the evidence was not competent, under the Chancellor’s previous decree, and that the plaintiff, after admitting the fact of the expenditures, &c. could not offer evidence to controvert it at a future stage of the case. The necessary rule of proceeding is, that whatever is once established or adjudicated, either in law or fact, is conclusive ever afterwards in the same suit.
    The decree of July, 1846, establishes the fact that the disbursements stated in the guardian’s returns were made; leaving open the question whether the expenditures were reasonable or unreasonable in amount, and this adjudication was not to be disregarded. It is oidered that the exceptions be overruled, and that the report in the alternative excepted to be confirmed, and. that the defendant do pay the plaintiff the sum of one hundred and forty-eight dollars and seventy-six cents, reported to be due the 19 th inst.
    Villard v.Chovin 2 Strob. Eq. 40; Prince & wife v. Logan, Spear’s Eq. 29; Boggs et al. 327.
    The complainant appealed, on various grounds, from both decrees.
    
      Williams, for the motion.
    Witherspoon, contra.
   The following is the decree of the Appeal Court:

Curia, per

Caldwell, Ch.

The only question which this Court considers material to decide at present, arises out of the circuit decree of 1846: were the expenditures made by the guardian for the ward necessary and expedient ?

The general rule is, that a guardian shall not exceed the annual income of the ward’s estate in expenditures. When he ventures to encroach upon the capital, there must be some emergency to justify it: he ought to make a clear case of its being necessary and expedient to the ward. He is an agent and trustee appointed by the law, in loco parentis, to discharge important duties to the child, and is generally informed of his powers and liabilities ; there is scarcely any guardian but knows that when he is infringing upon the corpus of his ward’s estate, he is acting in direct derogation of an established rule: the whole burden is, then, thrown upon him to show the emergency of the circumstances and the expediency of his expenditures, before the Court can approve of his conduct. Guardians are not to be encouraged in pursuing this irregular and often arbitrary and improper course, which almost invariably leads to litigation, and rarely bestows a benefit upon the ward.

Access to the Court is easy as it is always open, but when its authority is invoked to encroach upon the capital, its powers are exercised with extraordinary caution, and never without the clearest and most satisfactory proof — a doubt would defeat the application. When the guardian takes this high responsibility upon himself, he cannot complain that he must make out, at least, as clear a case for the subsequent sanction of his expenditures, as he would have been required to do on an application for its authority to make them.

The guardian’s accounts extend through a period of more than four years, and the principal items are for board and merchants’s accounts — the last item in the account is for board, $245. Such lumping charges cannot be permitted to pass without scrutiny, and as the evidence does not show under what circumstances the greater part of the expenditures were made, it is impossible to say whether they were reasonable or not; before they can be allowed the proof must establish that they were necessary or expedient for the ward; his peculiar situation, his pursuits, age, ability, and even his expectancies, are circumstances that may have weight to show the reasonableness of extraordinary expenditures. But the evidence t here is insufficient and unsatisfactory, and the case must be sent back for further proof as to the necessity and propriety of the guardian’s charges in his accounts: neither the acknowledgments of the ward, or the admissions of the plaintiff’s counsel, have dispensed with this proof.

The defendant has insisted on the statute of limitations, but he has not pleaded it. Generally parties are permitted to pursue their own course, without directions as to the form in which they should present their claim or defence, where the case is finally disposed of on the pleadings and proof; but as this case is to go back to the Circuit Court, the defendant ought to be permitted to put in such plea, if he sees fit to do so.

It is further ordered and decreed that the circuit decree of 1846 be modified, and the case be .remanded to the Circuit Court, for further proof of the necessity and expediency of the guardian’s expenditures for his ward, and that the defendant have leave to plead the statute of limitations.

Johnston and Dunkin, CC. concurred.

Decree of 1846 modified.