Court Opinion

ID: 7060417
Source: CourtListenerOpinion
Date Created: 2022-07-24 07:20:13.54171+00
Date Added: 2024-06-11T16:12:08.988413
License: Public Domain

Dissenting Opinion.
Lotz, J.
The main point in this case is to determine the effect of the final settlement of the estate of Daniel Barnett, as alleged in the second and third paragraphs of the answer.
Was this final settlement such an adjudication as fixed and determined the interest of all persons in the property of the deceased?
It may be stated, as a general proposition, that the approval of the final settlement of an estate after due notice given is an adjudication of all matters necessarily involved in the administration proceeding. Carver v. Lewis, Admr., 104 Ind. 438; Pate, Exec., v. Moore, Admr., 79 Ind. 20; Peacocke v. Leffler, 74 Ind. 327; *55Sanders, Admx., v. Loy, 61 Ind. 298; Castetter v. State, ex rel., 112 Ind. 445.
The heir, the legatee, the creditor and all other persons having an interest in the estate are brought into court by the notice of final settlement, and the judgment of the court operates upon their rights in the property, and they may always interpose the judgment to protect their rights acquired under it, while it remains in force. But in the case at bar it is not an heir, a legatee, or a creditor that claims the protection of the judgment; it is a debtor of the estate, a person who owes it, that seeks to shield himself behind the final settlement.
Is the debtor a party to the proceedings? Is he brought into court by the notice? and, if so, in what manner does the final judgment affect a chose in action that he has never paid to the estate? ■ Unless he be brought into court, and unless the judgment of the court acts upon the chose in action that he owes the estate, it can not be said to be an adjudication in his favor. At first impression it does not appear very clearly how the judgment of the court, in approving the final settlement, can enure to the benefit of a debtor. The statute requires that the administrator shall give notice of the settlement “to all persons interested in said estate.” And “if the account is filed for final settlement, the notice shall also require the heirs of the decedent, and all others interested, to .appear and make proof of their heirship or claim to any part of said estate.” Elliott’s Supp., section 403.
The Supreme Court, in construing the language above' quoted from the statute, held that a notice which ran “to the heirs, creditors, and legatees,” instead of all persons interested in said estate, afforded no ground for setting it aside, and that, as applied to the subject matter, the one is substantially the equivalent of the other Roberts v. Spencer, Exec., 112 Ind. 81.
*56This construction would seem to exclude the idea that a debtor of the estate was intended to be brought into court by the notice. To determine whether or not a debtor of an estate is in court in an administration proceeding, we must inquire into the nature and purpose of administration upon the property of deceased persons. When a person dies intestate, owning property, the real estate descends to the heirs and the personalty goes to his representatives. The personal property is set apart by the law, to be devoted to certain purposes. The management and disposition of such property is administration, and the person who performs such acts is called the administrator. The main objects of administration, as provided by our statutes, are to collect, preserve and properly account for the property, and from it supply the immediate wants of the widow and young children, if any there be; the payment of all just debts of the deceased, and the distribution of the residue or surplus among the heirs as the law directs. A man in life-acquires property, contracts debts and has obligations accruing to him. Immediately upon his death all is changed. His ownership in property has ceased. He no longer owes a debt, and no obligation is due him. The law instantly affects the property and fixes the rights of heirs, creditors and debtors in it. What was before a personal obligation becomes a property obligation. The deceased no longer owes. The property owes and the debt has all the force and effect of a lien on the property. The law makes the property a trust fund for specific purposes. The debtor of the deceased no longer owes a person, but he owes the estate or fund. His debt or chose in action is a part of the estate, or property belonging to the estate, and which will be affected by the administration process. The obligation of the debtor does not cease to be personal; he is charged by the law with making the *57payment to the administrator or representative. The debt being a part of the property of the estate, and being affected by the process, the debtor is also affected to the extent of being compelled to take notice of the altered conditions and rights in the'estate of the deceased. The settlement óf an estate of a deceased person possesses some of the elements of a proceeding in rem. The res is the estate; the seizure is obviated by the fact that the property is in custodia legis. When the process shall cease to act, the status of all the property will be fixed by the order and judgment of the court. Waples Proceedings in Rem, section 564; Grignon, etc., Lessee, v. Astor, 2 How. (U. S.) 318.
A review of the requirements of our statutes in administration proceedings may assist in determining how the property of the estate is affected. When an administrator is appointed, he must give notice of that fact. Section 2259, R. S. 1881.
He must “make a true and complete inventory of the personal estate of the deceased which shall have come to his knowledge, including all debts, demands, stocks, moneys, and goods, due to and owned by the decedent at his death,” and cause the same to be appraised. Sections 2260 and 2273, R. S. 1881.
Such inventory and appraisement shall be returned to the clerk of the court, and,.when corrected and approved, shall be'filed and recorded. Section 2270, R. S. 1881, and section 383, Elliott’s Supp.
The administrator is required to proceed with diligence to collect the. debts and demands due the estate. Section 2299, R. S. 1881.
And is given full power to bring suit for that purpose. Section 2291, R. S. 1881; Horton v. Hastings, 128 Ind. 103.
He may compound doubtful debts. Section 2301.
*58And may file such claims for the benefit of heirs, legatees and creditors. Section 2302, R. S. 1881.
He must keep an accurate account of all his doings with the property of the deceased, and file and exhibit his account in court. Section 399, Elliott’s Supp.
If he desires that his account, when approved by the court, shall become an adjudication, he must give notice to all persons interested in said estate to appear in court on a day fixed and show cause why such account shall not be approved. Section 403, Elliott’s Supp.
"After the debts and legacies of an estate and the expenses of administration have been paid, and all assets of the estate duly accounted for, and all claims in favor of the estate disposed of according to law, the executor or administrator shall, under the order of the court, pay into court the moneys, if any remaining in his hands, and be discharged from the further administration of the estate, and the estate shall be, by the court, declared finally settled.” Section 2402, R. S. 1881.
The whole proceedings contemplate that all of the property of the deceased, including debts due him in his lifetime, shall be collected and devoted to such purposes as the law directs, and that when the estate shall be finally settled the property acted upon shall evolve from the proceeding with a new title and a new owner.
A judgment in rem "is an adjudication pronounced upon the status of some particular thing pr subject-matter by a tribunal having competent authority for that purpose, such an adjudication being a most solemn declaration of a court of competent jurisdiction, that the status of the thing adjudicated upon ipso facto renders it such as it declares it to be, and estops and precludes all persons from denying that the status of the thing operated upon is not what the court has declared it to be, and such judgments are conclusive not only upon the parties *59and privies, but upon strangers. In fact, a judgment in rem is conclusive against the whole world. The rule that estoppels are only binding on parties and privies does not apply to judgments in rem where the law acts directly on the thing itself and renders it that which the judgment declares it to be.” Herman Estoppel and Res Judicata, section 290.
The same author says, in section 292: “A judgment in rem is an adjudication pronounced upon the status of some particular subject-matter by a tribunal having competent authority for that purpose. It differs fr.om a judgment in personam in this, that the latter judgment is in form as well as in substance between the parties claiming the right, that it is so inter partes appears by the record itself. It is binding upon the parties appearing to be such by the record, and those claiming under or by them. A judgment in rem is founded on a proceeding, not as against the persons, as such, but against the thing or subject matter itself, whose state or condition is to be determined. It is a proceeding to determine the state or condition of the thing itself, and the judgment is a solemn declaration upon the status of the thing, and it ipso facto renders it what it declares it to be.”
Nor is it necessary that all persons who have an interest in the res have actual notice of the proceeding. If the court have jurisdiction to act on the subject-matter, all persons are held to have constructive notice, and the sentence or decree of the court declaring the state or condition of the property is conclusive upon all the world. Ib., section 295.
I think it clear that the administration process as provided and defined by our statute is strictly and only a process against the things or estate of a deceased person, and that when a final judgment or settlement is reached, the status or condition of the estate is fixed and de*60creed; that such decree presumptively includes all property of the deceased, including choses in action belonging thereto or forming a part thereof. All the world being parties to a j udgment in rem or a final settlement of an estate, it necessarily follows, that in pleading such judgment as a former adjudication the rule is not so strict as in pleading a judgment in personam. It is a general rule of pleading that matter which should come more properly from the other side, need not be stated. It is enough for each party to make out his own case or defense. He sufficiently substantiates his answer for the purpose of pleading if his pleading establish a prima facie answer. He is not bound to anticipate, and is, therefore, not compelled to notice and remove every possible exception and objection which may exist, and with which his adversary may intend to oppose him. Presumptions of law need not be stated. An answer of former adjudication must show that the matters set up in the complaint were within the issues of the former suit. It is not necessary, however, to show that the matters in controversy were actually litigated. It is sufficient to show that they were within the issues and might have been litigated in the former action. Kramer v. Matthews, 68 Ind. 172, and cases cited; 1 Works Prac., section 605.
The presumption here is that the final settlement acted upon all the property of Daniel Barnett, deceased, and it clearly appears that the appeal bond was in existence and was a part of the property of the estate when the final settlement was rendered. The answer makes a prima facie case. It is true it is but a presumption, and if, as a matter of fact, it was not inventoried or operated upon by the administration proceedings, then such fact, to be available, should have been supplied. The reply in this case did not go to that extent. Mr. *61Schouler, in his work on Exec, and Admr., section 528, says: “The final settlement of an executor or administrator with the probate court is conclusive, operating as a judgment of a court of competent authority, with jurisdiction of the subject-matter ánd the person, and can not be called in question, except by a direct proceeding, such as appeal or writ of error.” Another author says:
“It seems a self-evident proposition that the judgment or decree * * on the final settlement by an executor or administrator is conclusive only upon the matters therein embraced; that which has not been tried can not be said to be adjudicated.” * * * Amer. Law Admr., section 506.
The presumption should be indulged that the account is correct, and that the executor or administrator has accounted for and administered upon all the property of the estate. Soutter’s Estate, 105 N. Y. 514; Williams Exec. (4th Amer. ed.), 583 note 1, 183 note 1; Beall v. New Mexico, 16 Wall. 535.
Appellant relies upon the act of March 5th, 1891 (Acts 1891, p. 107), as giving her the right to be appointed administrator de bonis non after there had been a final settlement of the estate.
Before the taking effect of this act it was conclusively settled that after an estate had been finally settled and the administrator discharged, letters of administration de bonis non could not issue upon the same estate while such final settlement remains in full force. ■ Pate, Exec., v. Moore, Admr., supra; Croxton v. Renner, 103 Ind. 223.
The purpose of the act of 1891 seems to be to give the court exercising probate jurisdiction power to appoint an administrator de bonis non notwithstanding a final settlement, when there are assets that have not been administered, and in effect changes the rule announced in the *62cases above cited. If it had been made to appear that the assets of the estate of Daniel Barnett that are sought to be recovered in this action were unknown .or were omitted from the former administration, then a very different question would arise under this act; but there is nothing to show that these assets were not fully administered in the former proceedings.
As I view this case, the act of 1891 authorizing the appointment of administrators de bonis iion after final settlement does not affect the rights of the parties to this action in the least; the plaintiff's right to sue as administratrix is not questioned. In issuing the letters to her, the court did not adjudicate that this claim was unadministered, no reference or allusion was made to it; and surely if the appellees had any rights under the final settlement, they could not be taken from them by an order of the court ex parte in it’s nature and without any notice whatever to them. Statutes are to be construed so as to have a prospective rather than retroactive effect unless the contrary plainly appears. If I understand the prevailing opinion, the act of 1891 is not only held to be retroactive in its effect, but the final settlement is annulled and set aside by it so far as the claim in suit is concerned.
If I am correct in my view that the final settlement is an adjudication, a decree in the nature of a judgment in rem in which all the world were parties, then the legislature had no power to pass an act destroying the rights of the parties secured by it.
The settlement of an estate by administration is only a matter of convenience. It may be done without administration. The heirs may pay all debts and then collect all claims; and so may devisees and legatees.
There was no necessity for the act of 1891 to enable heirs or legatees to collect claims or secure property be*63longing to an estate after final settlement. They had this right independent of the statute'. The statute only enables such property to be administered in a more convenient method. If any property had escaped the process of administration, either by fraud, negligence, accident, mistake, or was subsequently discovered, it was only necessary to appeal to a court of equity and show that the property was not involved in the adjudication of the final settlement, and it could be reached by heirs or legatees. It is one of the prerogatives of a court of equity to afford relief in such cases. Griffith v. Godey, 113 U. S. 89 (93).
It is true that it is the policy of our law to settle the estates of deceased persons by taking out letters of administration (Northwestern Conference, etc., v. Myers, 36 Ind. 375), and that a creditor must collect his claim against an estate by and through administration under the law, and that he can not maintain an action against the heirs, devisees and distributees until after there has been a final settlement. Leonard v. Blair, 59 Ind. 510.
It appears, from the pleadings, that the appellant is more than a creditor. She is the widow of the deceased, and claims an interest in the estate, given her by the law. If all the debts of the estate are paid, she might maintain this action without administration, or after a final settlement had been made. I do not question the plaintiff’s ‘ appointment, or her right thereto under the act of 1891, but what I do say is that when the answer of a former adjudication was filed, to preserve her rights she should have replied that the claim in suit was not inventoried, administered, or involved in the administration process. Indeed, if there be no element of bar in this action, she may still maintain her action and recover said claim, without the appointment of an administrator.
I regard the case of Carver v. Lewis, supra, conclusive *64on the questions here involved. That was not a case to recover damages for the negligence of the former administrator, but to recover a trust fund, a part of which had been collected by the last administrator. The heir, legatee, or creditor may pursue the property in specie, but a creditor of an estate can not maintain an action against the administrator, personally, for his negligence, but must sue on his obligation or bond. Nor can he sue an administrator de son tort and recover a personal judgment.
Filed March 17, 1893.
I am of the opinion that the case should be affirmed.