Court Opinion

ID: 9811806
Source: CourtListenerOpinion
Date Created: 2023-08-31 22:29:06.956129+00
Date Added: 2024-06-11T15:21:31.491829
License: Public Domain

Davis, J.
(dissenting). I cannot concur in the opinion, that where a final account is filed by an executor or administrator, there is no limitation to an action against him by the next of kin, unless the action be on the bond.
Except in actions commenced before the 24th of August, 1868, or in cases where the right of action accrued before that date, all civil actions must be commenced within the periods prescribed in title 3, chapter 10, of The Code, “ except where in special cases a different limitation is prescribed by statute.” The Code, §§ 136 and 138.
There is now no such thing as a statutory presumption, and all persons having a right to sue, unless under some of the disabilities named in the statute, must bring their actions within the times limited, or an absolute bar may be interposed.
*341Section 154, subsec. 2, of The Code, requires that an action (not against sureties, but) against any executor or administrator, &c., on his official bond, shall be commenced within six years from the filing and auditing of his final account as required by law.
Section 155, subsec. 2, requires the action to be commenced within three years “upon a liability created by statute, other than a penalty or forfeiture, unless some other time be mentioned in the statute creating it.”
The duties and liabilities of execators and administrators are prescribed in the various sections of chapter 33 of The Code, and among these, §§ 1488 and 14^9 define their duties in regard to paying over, to persons entitled to the same, money remaining in their hands, specifying what maj7 be retained, and if they do not know to whom to pay, they may file petitions against all parties interested, under § 1225, et spq., or they may pay it into the Clerk’s office, under § 1543.
By sec. 1402, they may be required to file their final accounts for settlement at any time after two years from their qualification, and this at the instance of any one interested in the estate; and §§ 1510 and 1511 give to legatees and distributees the right to sue executors and administrators for legacies or distributive shares, at any time after the lapse of two years f -om their qualification.
Section 1504 directs when money shall be paid to the University.
Section 155, subsection 6, limits an action against the sureties to three years after the breach for which the action is brought. So that, as I understand the law, the limit to an action against the executor or administrator, individually, and on his bond, is six years after the filing and auditing his final account, and against his sureties on his bond, three years after a breach or failure to discharge any of the duties required of him by by law. The ultimate limit of liability is three years after filing and auditing his account, unless *342against him individually and on bis bond, and then six years is the ultimate limit.
The filing and auditing the final account is the initial point at which the statute begins to run against the executor or administrator; and this, it seems to me, is not only the proper construction to be placed on the sections of The Code referred to, but, as we shall presently see, is, I think, the only construction that has been placed on them by this Court since The Code went into effect.
It is admitted that the statute is a bar to an action on the bond by the next of kin. The bond is given to insure a faithful discharge of his duties by the fiduciary, and one of these duties is to deliver and pay over, to the person entitled to the same, all sums in his hands, at the expiration of two years, with the exceptions referred to in §§ 1488 and 1489 of The Code.
If the person or persons entitled shall be vigilant enough to do so, he or they may bring an action on' the bond against the principal alone, within six years after the filing and auditing the final account.
It will not do to say that the six years’ bar is to protect the sureties on the bond ; they are protected by a much shorter limit. Three years, from the filing and auditing the final account, is the longest possible time by which they can be held bound, and what possible necessity can there be for the six years’ bar to an action on the bond given to insure the faithful discharge of the duties of the executor or administrator, if there is an equal remedy, as against him by suit, noton the bond, to which there is no limit? It seems to me contrary to all analogy and to all precedent, to say that there shall be a limit to a right of action for breach of fiduciary duty, secured by the solemnity of a bond, and no limit at all to an action for the same breach of fiduciary duty, if you choose to ignore the bond and sue on the simple liability. It was not so with the statute of presumptions, where *343no such distinction existed. The statute of presumptions began to run when the cause of action accrued. So, now, the statute of limitations begins to run from the respective periods designated in the statute, and where none is designated or provided for, then “ within ten years after the cause of action shall have accrued.” The Code, § 158.
This last referred to section applies to every action not otherwise “provided for,” and there is now no action to which some limit, according to the subject-matter, does not apply. The administrator, after his final account and settlement, has no right to retain in his hands the money of the estate to await the demands of those entitled to it, but it is his duty to pay it over, and it is the right and duty of those entitled to it (if laboring under no disability) to see that this is done within the time limited, or they will be barred. After the filing and auditing of the final account, he has no duty to perform in relation thereto, except to pay what he may have in his hands to the persons entitled to it.
The action before us is based on § 155, subsection 9, of Code, and the complaint recognizes the fact that the statute would bar the action, but for allegations 5 and 6, in which it is charged that there were frauds in the final settlement, and that the frauds did not “ come to the knowledge of the plaintiff before the last three years previous to the bringing of this action, but were discovered within said three years, and not without.”
These allegations of fraud and recent discovery were denied, and presented issues upon which depended the plea of the statute of limitations, and the right of plaintiff to the plea of the statute of limitations, and the defendant had a right to have these issues passed upon.
After the time prescribed in § 153 of The Code, the statute is an absolute bar to creditors (Lawrence v. Norfleet, 90 N. C., 533; Worthy v. McIntosh, 90 N C., 536), and after the time prescribed in § 154, subsec. 2, and § 155, subsec. 2, the *344statute is an absolute bar to the next of kin. Vaughan v. Hines, 87 N. C., 445; Spruill v. Sanderson, 79 N. C., 466.
But it is said that Bushee v. Surles, 77 N. C., 62, and Grant v. Hughes, 94 N. C., 231, are in conflict with this position. I think not. In Grant v. Hughes, the action was governed by the law as it was prior to 1868, the original administration having been taken out in 1861, and so far as the question before us is concerned, has no application, and, as was said in Vaughan v. Hines, distinguishing it from Bushee v. Surles: “In that case (Bushee v. Surles) there had not been any final account filed by the administrator,” and, besides, as will be seen by reference to the original record of the case on file, though it does not appear in the report, the administration was prior to 1868, and that case does not apply.
But it is said Vaughan v. Hines and Andres v. Powell were actions on bonds.
This is true, but in Vaughan v. Hines it is expressly said that the statute of presumptions has been repealed, so far as it applied to actions upon the bonds of administrators, &c. and the statute of limitations substituted therefor.
There being now no statute of presumptions, the statute of limitations, according to the subject-matter, applies to all actions whatever.
. I think the reasoning in Vaughan v. Hines is predicated upon the idea, that the limitation to an action upon the bond is the ultimate time within which an action can be brought by the next of kin, and the following citation from that case is, to my mind, conclusive of the question before us. After stating that the statute of limitations prescribed by The Code applied to that action, it is said :
“ That being so, the question arises, does the statute of limitations prescribed by The Code run in favor of an administrator against an action brought by the next of kin for their distributive shares? It was held in Ivy v. Rogers, 1 Dev. Eq., 58, a case decided in 1827, and recen ity approved *345by this Court in the case of Hodges v. Council, 86 N. C., 181, that where there was a return made by an administrator to the county court, admitting a balance against him, the statute of presumptions was put in motion, and, after ten years from the date of the return, a bill filed by the next of kin to recover that balance was held to be too late. Chief Justice Taylor, who delivered the opinion of the Court, said: ‘This case is purely of equitable jurisdiction, and not subject to any legal bar, by force of the statute of limitations, yet this Court, from an early period, has adopted rules as to barring an equity, drawn as nearly as possible from analogy to the rules of law.’ ”
And in answer to the objection (the very objection that is made in the present) that the defendant, who was an administrator, was a trustee, and therefore could not avail himself of such a defence, proceeded to say : “ I deem it unnecessary to examine the doctrine relative to express and implied trusts, because the settlement of the account by the administrator presents a clear ground of decision, whatever the defendant’s original character may have been. From that time the trust ceased to be open, and the defendant stood in a new relation to the complainant as his debtor. ■Could the complainant have sued at law, his cause of action would then have begun to run from that time.”
The principle to he deduced from this decision is, that if the action could he brought at law upon the bond of an administrator, who had filed his final account in the proper office, the statute of presumptions would begin to run in his favor against the next of kin, and the claim would be presumed to be paid after the lapse of ten years from the tim e of filing the account.
Where the statute of presumptions began to run under the old law, I think the statute of limitations begins to run under the new, and whether under the one or the other, the filing of the account is the initial period of time at -which it *346begins to run in favor of an administrator or executor against next of kin or legatees. As was said by Chief Justice Taylor, in Ivy v. Rogers (quoted in Vaughan v. Hines and Cox v. Cox), the doctrine in regard to express trusts has no application after the filing of the final account. Certainly, if it could have none under the law as it then stood, it can have none now; and, as was said by this Court in regard to the return of the administrator in Vaughan v. Hines, “ it was such a statement as showed to all persons interested in the distribution of the estate that the administration of the estate was finished ”
Whenever the right of action accrues to the cestui que trust against the trustee, whether the trust be express or implied, and certainly after the “ trust ceased to be open,” by the plain and unmistakable language of the statute, it begins to run, and the action must be brought within the time limited, if there be no disability. The right of action accrues to the legatee or distributee after two years from qualification of the executor or administrator, and he, if no disability exists, brings his action within six years after the filing and auditing the final account, or he may be barred.
For the reasons given, I think the defendant had a right to have the issues of “ fraud ” and “ discovery within three years,” raised by the allegations of the complaint and denials of the answer, passed upon before re-opening the account.
Note. — Davis, J. Since this was filed, the opinion of the Court has been to changed as to make ten years a bar, and to that extent what is said in the dissenting opinion does not apply.