Case ID: sc-eq_16/html/0335-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Curia, per Dunkin, Chancellor. J. S. Richardson, John Belton O’Neall, Wm, Harper, Josiah J. Evans, A. P. Butler. Johnson, Chancellor,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

James Rainsford et ux. vs. Thomas Rainsford.
    The actual profits, realized by a trustee from the property of his cestui que trust* where it can be ascertained with reasonable certainty, is all that a Court of Equity will require to be accounted for, by the trustee. The Court resorts very reluctantly to the* principle of charging a trustee with the annual hire of negroes committed to his custody.
    
      Before Johnson, Ch. at Edgefield, June Term, 1841.
    The only question remaining of this much contested case is the extent of the defendant’s liability for the hire- of the complainant’s negroes, which the defendant had in his possession for many years; and this of course involves the rules by which that is to be ascertained.
    Where one obtains possession of the property of another,, by force or fraud, both justice and policy require, that he should account for the thing itself, and its use, at their full value; and it is on this principle, that in actions at law for torts, juries often by their verdicts give, in damages, what is called smart money, but it is otherwise, where one obtains possession of property righfully, as in the case of executor or trustee. There, for the same reasons, he ought to account for what they are reasonably worth. This distinction is distinctly recognized by the decree of Chancellor Harper, referred to in the commissioner’s report, (see Rice, Eq. Rep. 369,) which, in this respect, was affirmed by the Court of Appeals, where it is said, that the defendant ought to account by the latter rule, as one who “ had discharged his trust in honesty and good faith.” It is said, however, that altho’ this rule might well apply to the defendant’s possession up to 1833, when he refused to deliver them upon demand, that from thenceforward he was a wrong doer, and ought to account according to the former rule.
    There is some reason in this, but no one who knows any thing of the history of this case, will doubt that the defendant believed confidently, that the negroes belonged to himself, and treated them accordingly, until he was undeceived by the solemn judgment of the Court; and having myself originally tried the cause on the Circuit, and heard the argument in the Appeal, I can say, with confidence, that it involved a question of much difficulty; one which a plain man could hardly be supposed competent to decide ; one which was fairly open to discussion. Now the igno> ranee of law, according to a standing maxim, is no excuse for a wrong done, but that is no reason why the wrong doer should be punished, merely for his ignorance. He who knows my will, and does it not, shall be beaten with many stripes, but he who .knows it not, shall be beaten with few stripes, is a rule of high authority, and applies with full force to the question in hand.
    The decree pronounced by Chancellor Dunkin, at June Term, 1840, is referred to, as deciding that the defendant was only bound to account for the actual profits; but, as I understand it, the only question decided was, that the commissioner erred in rejecting evidence of the actual profits. It never ought, and never can be applied generally. Many honest, industrious, and frugal men are involved in ruin, by the want of skill or address in the conduct and management of their own affairs, and so of an executor or trustee. He may have the possession of an estate, organized in a manner the best calculated to render it productive : he may carry into the service, the greatest zeal and good faith: he may use the greatest industry, and practice the greatest economy, yet, if it be a plantation and negroes, he may want the talent for governing the ne-groes, and skill in planting and working the crop, and the result may be a loss and not a profit. He undertakes for more than this in assuming and accepting the trust. No one ought to engage in it, who is not competent to the duties required of him, and that this implied in the nature of the undertaking; not that he possesses all the qualifica-lions in the highest, but in an ordinary degree, and if he fails in this, he must account for ordinary profits. Actual profits cannot therefore be relied on, as an unerring measure of liability, for the profits of slave labor. It must be tested by the result. If it falls below the ordinary standard, it furnishes no rule at all. For that much at least, the executor or trustee undertakes, and he is bound by it; and if, by the exercise of more than ordinary skill and industry, he has made a greater profit, that will constitute the measure of his liability.
    The commissioner has assumed from certain data, refer-ed to in the report, that the defendant's whole income, during the time that he had the negroes in possession, was $17,906 34, and computing the average number of the ne-groes of the complainant, and those of the defendant’s own, employed in making this income, (or rather, upon the offer of the defendant,) at one-sixth, has allowed the complainant that portion of the amount.
    But on looking into the report, it will be seen that this is founded on mere conjecture, and however nearly it may approximate justice, cannot be admitted as a substitute for a rule of law. The defendant personally superintended the plantation. The lands planted were his own. For these the defendant was clearly entitled to compensation, and they constitute a charge on the general income. On the other hand, the defendant’s whole family were subsisted, and his children educated out of the general income, through a period of near twenty years. To these the complainant was not bound to contribute, yet the report, by adopting the value of the property, at the death of the defendant, as the measure of the nett income, charges the complainant with one-sixth of all the disbursements, made by defendant, on these and all other accounts, when he ought to have been charged with that proportion of the disbursements made on account of the plantation alone.
    No account whatever, has been kept of the actual income and expenses, and the report, (indeed the whole history of the case,) sufficiently shows, that it is impracticable at this day, to ascertain with any degree of certainty, what was the actual income. The defendant must therefore, according to the rule, account for what the labor of the complainant’s slaves, whilst they were in his possession, was reasonably worth.
    There is scarcely any thing more fallacious, than the manner in which slave’s labor is usually estimated. Planters not used to minute calculations, usually put it down at the gross sales of their produce in the market, without taking into the estimate, the money actually, expended in the production, in which, on the best regulated plantations, a considerable portion of it is consumed.
    In the note to Lyles vs. IajIbs, some suggestions may be found, which may materially aid the witnesses called to testify, as to the value of the hire of the slaves. They are referred to, not as furnishing arbitrary rules, but- a memento of the sources of the expenditures incurred by the planter in making a crop. The estimates must necessarily be varied according to the conditions of the slaves and the quality of the land planted.
    I concur entirely in the principles of the Circuit Court decree, of June' Term, 1840.
    If there was no want of skill or diligence on the part of Thomas Rainsford, in the management of the estate, and the actual profits could have been ascertained, that would have constituted the precise measure of his liability, but it has been before shown, that the principle has been entirely lost sight of, in making up this report, and in truth, it is wholly inapplicable to the state of facts that exists. No attempt has been made to account for monies expended by Thomas Rainsford, in the subsistence and education of his family, and for other purposes, not immediately connected with planting, which through so long a period must have been considerable, with the most rigid economy ; and from the circumstances already developed, it is obvious that it is impracticable. The only alternative left, is to charge him with the hire of the slaves. This general view of the case supercedes the necessity of examining the exceptions to the report.
    The commissioner has reported against the defendant, on account of the hire of the slaves, $3698 28 of which $2984 39, is conceded by the defendant to be due, and complainant’s solicitors have asked a present decree against the defendant for $2500. Whatever principle may be finally adopted in making up the accounts, a much larger sum must he due to the complainant, and it is hut right that he should not he longer delayed to this extent at least. It is, therefore, ordered and decreed, that the defendant do pay to the complainant, within one month after notice of this decree, two thousand five hundred dollars, on account of the hire of the slaves mentioned in the pleadings, and that, in the mean time, complainant have leave to issue final process for that sum, hut no sales of property are to he made thereon, until after the expiration of the said month.
    It is also ordered and decreed, that the matters of account be referred back to the commissioner, and that he make up the accounts between the parties, on the principles of this decree.
    
      Grounds of Appeal.
    
    1st. Because the decree of Chancellor Dunkin, awards to the complainant James Rainsford, a specific sum, or, at all events, decides that the estate of Thomas Rainsford, was only liable for the actual profits derived from the labor of the said complainant’s slaves, and recognizes the sufficiency of the evidence to establish, with reasonable certainty, what were those profits, and what the proportion to which the said complainant was entitled; and because that decree, having been sustained by the Court of Appeals, was therefore final and conclusive, and the report of the commissioner, of June Term, 1841, conforms substantially to that decree, in either aspect considered.
    2nd. Because, even tho1 the decree of Chancellor Dun-kin be understood as only deciding, that the commissioner erred in rejecting evidence of actual profits, the evidence adduced was ample, to establish due diligence and skill on the part of Thomas Rainsford, and, with reasonable certainty, the amount of those profits, as well as the proportion to which the complainant was entitled, as ascertained ■by the aforesaid report of the commissioner.
    3d. Because, in referring back to the commissioner, the matters of account, his Honor has erred in precluding the defendant from supplying any deficiency, which may be supposed to exist in the evidence heretofore adduced, to establish the amount of actual profits; and it is submitted, that the opinions of witnesses, as to the value of the hire of the complainant’s slaves, or the reasonable worth of their labor, whilst they were in the possession of the defendant, must of necessity be no less conjectural than estimates made by the same witnesses, of. the income and expenses of the defendant, during the same period.
    4th. Because his Honor has erred, in allowing the complainant, previously to the final judgment and decree of the Court, to issue execution fox any portion of the sum claimed by him.
    Wardlaw, for the motion,
    cited the old case, from Rice, Ch. 343, 369. Dec. 2, 1841, In Error. The old case, Rice,, Eq. 343. Report, 1840. $7,000.
    Bauskett, contra.
    
   Curia, per Dunkin, Chancellor.

By the decree made in this case, reported in Rice’s, Eq. R. 369, it was held, that the defendant must account for the complainants’s slaves, while in his possession as “one who had discharged his trust in honesty and good faith.” At the references under that decree, evidence was offered by the complainants, of what would probably be the annual hire of such negroes, during the nineteen years, in which they were held by the defendant, and on the other hand, the defendant attempted to shew, what had been actually realized; and for this purpose, offered testimony as to his situation, when his fiduciary relation commenced, his habits of life, the estate he had accumulated when his trust ceased, and the proportion which the capital of the complainants bore to the entire capital employed. The defendant proposed to pay a specific sum, as a larger amount than that to which the complainants would be entitled on these principles. The commissioner, admitting that the result would be more in accordance with justice, than by any other rule which could be adopted, felt himself controlled by the former decree, or because such testimony would not furnish a general rule. In reforming, the report of the commissioner, neither the Circuit nor the Appeal Court should he understood to have fixed any specific sum for which the defendant was liable. While stating that the testimony must necessarily be varied according to the circumstances of each particular case, the Circuit Court declare, that the proof tendered by' the defendant was properly admissible, and that if the commissioner, acting on-that testittiony, had reported the sum tendered as á full account, on the principles heretofore established, it would have been no violation of any general rule of evidence, or of any former decree in this particular case. But it was perfectly competent for the . complainants, under that decree,- to shew, that the defendant had made more, or that, exercising ordinary diligence and skill, he ought to have made moré; or that the proportion offered to the complainants was/not according to their interest. The report was sent back to the commissioner, additional testimony was received, and the commissioner reported the sum of $3,698,28, as the amount due by the defendant, on the principles of the decree of June' 1840, as affirmed by the Court of Appeals. It is supposed, that the conclusions of the commissioner are merely conjectural. But this is not perceived. The proof must be according to the purpose, to' be accomplished. The object is. to ascertain the profits realized by a bona Jide trustee. What the defendant originally possessed, and what he left at his death, are ascertained with precision.. His habits of extreme frugality, even to .parsimony, are beyond doubt. This would not be satisfactory, if he made little or nothing. But the complainant’s, slaves consisted of a man and his wife, with three children, whose entire annual hire was estimated at $71. Under the supervision of the defendant, they had increased to ten, and their share of the profits, during the time, is estimated at $3698. In this state of the proof, we think the defendant should not be compelled to account for the annual hire. After carefully reviewing.the testimony, embodied in the report of the commissioner, we are of opinion, that the actual profits realized by the defendant have been ascertained with reasonable accuracy. This Court resorts very reluctantly to the principle of charging a trustee with the annual hire of negroes committed to his custody, under such circumstances. In most cases, it would be ruinous to tlie trustee, and if the rule were once understood, it would soon induce consequences, not less disastrous to the interests of the cestui que trust.

It is objected to the report of the commissioner, that no account has been taken of the expenses of the defendant’s family. But on the other hand, no charge is made for his own services, or for the rent of the land, in which the complainants had no interest. On the whole, adverting to the principles declared in the former decree, the Court are quite satisfied, that the amount reported in favor of the complainants, is more than their proportion of the profits, realized by a faithful agent; and that if the principle adopted by the commissioner cannot be of general application, it is because few defendants, at the end of a series of years, would be so fortunate in their testimony, as to frugal management and satisfactory results. In the judgment of the Court, the exceptions to the commissioner’s report should have been overruled, and the report confirmed, and it is now so ordered and decreed.

BENJ. F. DUNKIN. .

We concur.

J. S. Richardson, John Belton O’Neall, Wm, Harper, Josiah J. Evans, A. P. Butler.

Johnson, Chancellor,

dissenting. I do not know that the complainant ought to complain of the result, at which the Court have arrived. It may be, that he will receive more than he is, injustice, entitled to, and it may be less; but I must, and do, most respectfully, enter my protest against the means by which the Court have attained the result.

Since the explosion of what was called the £10 rule, as the measure of the annual hire of full task slaves, the only means left of attaining it are, 1st. actual profits, with reasonable diligence, and 2nd. what, under proper care and attention, they ought to have annually earned, under the peculiar circumstances of the case.

The accounts stated by the commissioner profess to be according to the first rule, excluding the second together, but on looking into the report, it will be found, that the actual profits do not enter into the account at all.

Thomas Rainsford, has died pending these proceedings, and although his name is retained in the title of the case, the proceedings are now against his executors, who have been made parties. As an evidence of actual profits, the defendant exhibited inventories and appraisements of the estate of John Rainsford, devised to Thomas Rainsford, and of the estate of Thomas Rainsford, which shows that the acquisitions of Thomas Rainsford, exceeded the property he acquired by his father, John Rainsford’s will, by about $17,900 ; and taking this as the actual profit, the commissioner has apportioned the fund amongst the parties, according to the number of slaves employed. But it will also be observed, that in stating this account, no notice is taken of property, to the value of about $7000, bequeathed by John to Thomas Rainsford, employed in the production of what is assumed as the actual profits'; no allowance is made for Thomas Rainsford’s services, in managing the concern, nor for the use of the lands on which the slaves were employed, nor, for the labor of several slaves, acquired by Thomas Rainsford on his second marriage. On the other hand, there is no charge against Thomas Rainsford, for the subsistance of himself and his family, and the education of his children. In short, it will be found on the examination of the report, that the actual income of the joint capital was a mere trifle, and that the accounts were made upon an offer of a gross sum, tendered by the defendant, with some fanciful additions by the commissioner, which the complainant refused to accept. It may be, that ample justice is meted out to the complainant, by the report of the commissioner and the judgment of the Court; but I have grown up in the belief that justice is not arbitrary, but must be measured by rule.

DAVID JOHNSON.

Wardlaw & Wardlaw, & Carroll, for the motion.

Bauskett, contra.