Court Opinion

ID: 6735107
Source: CourtListenerOpinion
Date Created: 2022-07-20 23:17:41.414607+00
Date Added: 2024-06-11T16:01:44.781104
License: Public Domain

PETITION FOR REHEARING.
Counsel for plaintiff have filed a petition for a rehearing, in which it is urged that the court was mistaken in asserting that there is no evidence in the record showing that plaintiff’s wards are the owners of the note in suit. They contend that there is other evidence than that sought to be derived from the possession of the instrument, and refer us to a certain written account or report made by Herline at the close of his guardianship, and filed and recorded in the county court on March 21, 1899. This document, which was received in evidence against defendant’s objection, purports to be an account of Herline’s guardianship from January 12, 1892, up to the time it was filed in the County Court. Under the heading of “Receipts” there appears this entry: “July 1st, 1892. Ole K. Hanson paid on $168 note $14.00, interest on said note $19.02.” Under the heading of “New Notes” the following entry appears : “(Stock) Ole K. Hanson, dated April 1st, 1892, due .90 days, 12 per cent, par, ren $168.” This abbreviation evidently means that the last-described note is a part renewal of the former note, and doubtless refers to the note in suit. On the margin of the report, and opposite the description of the note involved in this action, and certain other notes, these words appear: “These notes are not assets of the *253guardianship.” It would seem that this entry conclusively negatives the idea that the note in question belongs to plaintiff’s wards. However, it is unimportant what is meant by these entries; for, conceding that they tend to show that Herline purchased the note, and from the funds of these wards, yet that fact utterly fails to establish title of the note in the wards. At best, the note can be no more than an investment of the wards’ funds made by the guardian, for it was not a part of the original assets. The law requires investments to be made in a particular manner, and a guardian in this state may not either sell his ward’s property, or make investments of his ward’s funds, save on an order of the County Court. The office of a guardian is highly fiduciary in its nature, and has been made the subject of careful regulation by statutory provisions. A guardian may pay the just debts of his ward, and demand and sue for debts due to his ward. He may apply the income and profits of the estate to the comfortable and suitable maintenance and support of the ward. In these matters considerable latitude is given to his discretion. See sections 6553, 6554, 6556, Rev. Codes. But the power to sell the estate of the wards, or any portion of it, does not rest in the guardian individually. Neither has he authority to invest the funds of the estate in any kind of securities, except upon application to, and an order of, the County Court. The legal authority for both sales and investments emanates from the County Court, and that court alone. See sections 6561 to 6574, Id., both inclusive. The requirement as to the method to be pursued to make sales of property and to invest funds belonging to wards is specific, and requires that it shall be in pursuance of an order or decree therefor. It was held by the Supreme Court of Iowa, in construing a statute which required guardians to manage estates under the direction of the court, that such requirement implied an inhibition upon the doing of these acts without the direction of the court. See Bates v. Dunham, 58 Ia. 308, 12 N. W. Rep. 309. And the court in that case also held that a direction to loan the funds of the ward must precede the act of loaning. In the very recent case of Easton v. Somerville (Iowa) 82 N. W. Rep. 475, the court said: “A guardian cannot, as at common law, loan his ward’s money, or invest it in securties, without an order of court. His powers are conferred by statute, and he may loan their money, and in all other respects manage their affairs, under proper orders of the court or a judge thereof. Code, § 3200. Under this section it has been held that a guardian cannot loan the money of his ward, lease his land, or invest his funds without an order of court. * * * Such transactions, made without the order or direction of the Probate Court, are invalid or voidable, at least, until approved by the proper court.” See, also, McReynolds v. Anderson, 69 Ia. 208, 28 N. W. Rep. 558; Slusher v. Hammond, 94 Ia. 512, 63 N. W. Rep. 185; Reed v. Lane, 96 Ia. 454, 65 N. W. Rep. 380; Garner v. Hendry, 95 Ia. 44, 63 N. W. Rep. 359; Alexander v. Buffington, 66 Ia. 360, 23 N. W. Rep. 754; Dohms v. Mann, 76 Ia. 724, 39 N. W. Rep. 823. *254The County Court of Cass county has exclusive jurisdiction over this estate, and it does not lie within the jurisdiction of any other court to usurp its authority by fastening the title of a guardian’s void investments upon his wards by independent evidence. It is patent, then, that where the issue is whether the wards own certain property, which is the fruit of an investment made by the guardian, we must look to the order or decree of the County Court authorizing- or directing it, and not to the guardian’s report, for the latter is binding only upon himself. In this case plaintiffs have offered no evidence to show that Herline was authorized by the County Court to purchase the note in suit, or that such purchase was approved by the County Court. Neither was the report of the guardian filed in the County Court, and above referred to, approved and allowed. When the plaintiff’s wards obtain their majority they may demand the original estate, or its value, reduced only by lawful expenditures and such bad investments as have been authorized by the-County Court. They are not at the mercy either of the improvident judgment of their former guardian, or his unlawful diversion of their funds. The bond required to be executed under section 6544, Rev. Codes, stands in lieu of the original estate until it is fully accounted for under the statutes regulating the powers and duties of guardians. It is not necessary to consider whether the'written report of Herline was admissable for any other purpose. It is sufficient to say that it has no probative weight on the question of the title of the note, for the reasons already stated. If it affirmatively appeared that no order was in fact made either authorizing or approving the investment of the funds of the wards in the note in suit, it would clearly be our duty to direct a dismissal of the action. As the case stands, however, the record is simply silent on that point. For that reason the order reversing the judgment and directing a new trial, which will afford an opportunity to produce competent evidence of ownership in the wards if it exists, will stand. The petition for a rehearing is denied.
(83 N. W. Rep. 20.)