Opinion ID: 2379324
Heading Depth: 1
Heading Rank: 1

Heading: the right of the legatee to sue.

Text: The question of the right of the complainant, a residuary legatee, to maintain this suit was not raised either by demurrer or by answer by any of the defendants. The decree recites that this issue was raised by the Court, and it was one of the grounds upon which the lower court dismissed the bill. In his oral opinion the Chancellor, after referring to the allegations in the bill that the executor had neglected and refused to take any further action to recover this bank account for the estate, said: In the testimony there is no refusal or neglect on the part of    the executor. He followed this by quoting from the executor's answer the allegations which we have referred to with regard to reporting to the residuary legatees the refusal of Francis A. Tribull to pay over the fund, the indisposition of any of them, except Paul, to take legal action to require Francis to pay these funds into the estate, and Paul's expressed intention to sue and to engage his own attorney. The Chancellor then expressed the view that the bill could be brought only by the executor, even if he had refused to sue, and that the residuary legatee's only remedy was to apply to the Orphans' Court for an order requiring the executor to sue. The executor, in neither his answer nor his testimony, used the words refuse to sue, but in accordance with the familiar saying that actions speak louder than words we are unable to agree with the conclusion of the Chancellor that there was no refusal or neglect to sue on the part of the executor. His action, in the light of the facts before him, including his investigation of the bank records pertaining to the account and his apparent acceptance of the lack of demand or desire on the part of the majority of the residuary legatees for action against Francis, was for practical purposes the equivalent of a refusal to sue. There is also a strong inference of acquiescence on his part in Paul's expressed intention to bring suit himself. Even if the executor's inaction did not amount to a refusal to sue, it showed, we think, that a formal demand for suit would have been futile. We see no more reason for requiring that a futile demand for suit be made in a case such as this than for requiring a minority stockholder of a corporation who wishes to bring a derivative suit to make a futile demand upon the Board of Directors to bring a suit on behalf of the corporation. See Booth v. Robinson, 55 Md. 419, 439; Eisler v. Eastern States Corp., 182 Md. 329, 333, 35 A.2d 118. Whether or not this suit can be maintained at all by a residuary legatee  even though he is not barred by the absence of any refusal to sue on the part of the executor  is a substantial question. We have not been referred to, nor have we found, any case decided by this Court which is precisely on all fours with the instant case. Primarily, of course, the administration of a decedent's estate is committed to the Orphans' Court. In Wilson v. McCarty, 55 Md. 277, at 280, it is said: So long as assets can be found, which properly belong to the estate of the decedent, which have not been brought in and accounted for, the estate is not fully closed    If    there be assets which he [the executor] has not returned, or assets which can be recovered, which he has not recovered, it is not only within the power and jurisdiction of the Orphans' Court to require the executor to discharge his duty, but it is the plain duty of the court to compel him.    Rev. Code, Art. 50, secs. 5, 6, 14, 15. Marx v. Reinecke, 145 Md. 311, 318-319, 125 A. 541, quotes more fully the paragraph of Wilson v. McCarty from which we have quoted. The statutory references in Wilson v. McCarty are to the Revised Code of 1878, and these Sections are now codified in Article 93 of the Code (1951 Ed.) as Sections 254, 265, 266 and 267. The last three sections deal with concealment of assets, which is not charged here. Section 254 has been amended several times since 1878, chiefly in connection with the estates of persons absent and unheard of for more than seven years. There was, however, an amendment made by Chapter 437 of the Acts of 1931 (which was after the decision in Marx v. Reinecke ) which authorized the Orphans' Court to pass such orders as in their discretion may be required in the course of the administration of estates for the transfer of personal property, both tangible and intangible, the title to which is not in dispute. In Talbot Packing Co. v. Wheatley, 172 Md. 365, 190 A. 833, this was held to preclude an Orphans' Court from trying a question of title as between an administrator and a separate claimant. This result, as that case shows, was in accord with the law as previously determined by a number of cases cited in the Talbot Packing Co. case. Many of the cases which have dealt with the question of jurisdiction as between an equity court and an orphans' court are not directly in point because they involved questions of the right to proceed in equity by or against executors or administrators. Here, although the executor is a party, he has not invoked the jurisdiction of equity and he is not the real party in interest against whom relief is sought. The claim sought to be asserted is of an equitable nature. It could have been asserted by the executor, had he seen fit to do so; and we may assume (without deciding) that the Orphans' Court could have ordered him to bring suit to enforce it. Proceedings to that end could very easily have produced a preliminary contest between the present complainant and the executor, if the latter undertook to defend his inaction; and it is difficult to see how he could have done so without somewhat disparaging the claim. In Turk v. Grossman, 176 Md. 644, 6 A.2d 639, creditors of a decedent brought a suit in equity to reach some shares of stock which had belonged to the decedent and had been pledged by him and which were alleged to have been acquired by the defendants through fraud and collusion with the sole acting executor. This Court said (176 Md. at 669, 6 A.2d at 651): A second ground of demurrer is that general unpaid creditors of the testator do not have the right to bring the suit. Normally the executor or administrator as the personal representative of the decedent is the proper party, so far as personalty is concerned, to bring the action at law or suit in equity in matters which relate to the estate. The general rule is subject, however, to some exceptions and limitations, as where the rights of a legatee, devisee or creditor are substantially affected by peculiar circumstances, as fraud or collusion on the part of the personal representative and the person against whom the suit is brought; and the refusal or inability of the representative to act. Equity in such instances does not permit the general rule to interfere with its paramount function to prevent a fraud and provide a remedy and an actor for its correction. There is, of course, no charge of fraud or collusion against the executor in the present case. In the companion cases of Noel v. Noel, 173 Md. 147, 195 A. 322, 173 Md. 152, 195 A. 315, controversies between the widow, who also was the administratrix of her husband's estate, and the husband's mother and his sister were involved, and the interests of the widow in her individual and representative capacities were in part antagonistic. The principal suit was one brought in equity originally by the widow in her individual capacity alone, in which she later intervened in her representative capacity as a party plaintiff. Her right to sue was upheld against a demurrer. The holding in the equity case was very briefly summarized in the companion case (which involved a stay of proceedings in the Orphans' Court seeking the revocation of the widow's letters of administration pending determination of the equity suit) as follows:    Equity jurisdiction was sustained on that appeal because the jurisdiction of the Orphans' Court was inadequate and incomplete and did not include, as did the court of equity, the power of the determination of questions of partnership, of the creation of express and implied trusts and their associated relations of fiduciary and beneficiary, and the determination of title to personalty between conflicting claims on behalf of the estate of the intestate on the one hand, and the mother and sister of the intestate, on the other. In consequence of its more extensive jurisdiction, and of its superiority of remedy and relief, equity had paramount authority, and will retain its jurisdiction for such relief as may be necessary, and, while so exercising this jurisdiction, further proceedings on the pending proceedings in the Orphans' Court should be stayed. See also Boland v. Ash, 145 Md. 465, 125 A. 801, and the cases therein cited. At 145 Md. 474, this Court cited a number of cases in support of the proposition that under certain circumstances a court of equity may assume jurisdiction of the estate of a decedent, and also stated the rule that in the absence of special and unusual circumstances which render the power of the orphans' courts insufficient to afford adequate relief, equity will not exercise such jurisdiction. The Court went on to say: But where by reason of some inherent and constitutional limitation of its powers, the orphans' court, the forum in which relief would be naturally and ordinarily sought, is unable to afford a complete and satisfactory remedy, then equity will lend its aid. See also Alexander v. Leakin, 72 Md. 199, and Bennett v. Rhodes, 58 Md. 78. In the latter case the right of residuary legatees to sue was upheld where one executor owed a large debt to the estate, the other united with him in construing the will erroneously so as to deny the existence of the debt and hence both executors refused to sue to collect it and both parties owing the debt were without means to pay it unless it was charged on their interests in the estate. In the instant case the only remedy which the Orphans' Court could give would be to direct the executor to bring suit; that Court could not try the issue of the validity of the transfer of the bank account. Although the facts of this case are not so strong as those alleged in Turk v. Grossman , Noel v. Noel , Boland v. Ash , or Bennett v. Rhodes , all cited above, we think that they are sufficient to invoke the jurisdiction of an equity court. There is the unwillingness of the executor himself to bring the suit. There is his tacit assent to the suit being brought by Paul, which is confirmed by the absence of any objection on this score in his pleading. There is the practical effect of the passiveness of the executor to weaken or disparage the claim on behalf of the estate, and conversely to strengthen the position of the defendant, Francis. The claim is of an equitable nature. The problem, in the light of the authorities above referred to, is one of the exercise, rather than of the existence, of jurisdiction. We think that the case is one in which equity can give full relief and that all necessary parties are before the court. Undoubtedly, the case is one which falls short of the cases in which fraud or collusion on the part of the executor or administrator has been present as a factor supporting the exercise of equity jurisdiction. However, neither is essential to the exercise of equity jurisdiction in cases involving the administration of estates; the inadequacy of the powers of the orphans' court may be sufficient. Alexander v. Leakin, supra . See also 21 Am. Jur. page 940, Executors and Administrators, Section 1003.