Court Opinion

ID: 6899817
Source: CourtListenerOpinion
Date Created: 2022-07-23 21:53:48.505649+00
Date Added: 2024-06-11T16:06:07.950072
License: Public Domain

Mr. Justice Bean
delivered the. opinion of the court.
There are three questions presented for our consideration: (1) Whether, under Section 1161, B. & C. Comp., the county court, sitting in the transaction of probate business, has jurisdiction to adjudicate and allow a claim for more than $500 against an estate; (2) whether the notes upon which the claim of the bank is based were in fact the obligations of the partnership of Morgan & Stowell; and (3) whether they are barred by the statute of limitations.
1. The constitution provides: “The county court shall have the jurisdiction pertaining to probate courts, * * and such civil jurisdiction, not exceeding the amount of value of five hundred dollars, * * as may be prescribed by law”: Const. Or. Art. YII, § 12. It is argued that the examination and allowance of a claim against an estate under Section 1161 is the exercise by the county *236court of civil, as distinguished from probate, jurisdiction, being,, therefore, limited to claims which do not exceed $500. In our opinion, this view is erroneous. By the constitution county courts are vested with the jurisdiction pertaining to courts of probate, and the legislature is authorized to confer upon them limited civil and criminal jurisdiction. The two jurisdictions are, however, as separate and distinct as if conferred upon separate tribunals. While sitting, in the transaction of probate business, the nature and jurisdiction of a county court must be sought in the general nature and jurisdiction of probate courts as they are known in the-history of the English law and the jurisprudence of this country. The allowance or ordering the payment of claims against estates which are in process of administration has always been considered an appropriate subject for the jurisdiction of probate courts: 2 Woerner,Administration (2 ed.), § 391, et seq. In this country courts exercising such jurisdiction are often invested by statute with the power to hear and determine claims against the estates of deceased persons in a summary manner, without the formality' of technical pleadings: 2 Woerner, Administration (2 ed.), § 391, et seq. Such is our statute. The subject-matter of Section 1161, B. & C. Comp., pertains exclusively to the. administration of estates, and is clearly within the functions of a probate court.
2. The remedy there provided is not exclusive, but is intended to afford a speedy, efficient, and summary remedy to one who has a claim against an estate which has been rejected by the executor or administrator, without the necessity of technical pleadings or the observance of the formal proceedings required in an ordinary action: Wilkes v. Cornelius, 21 Or. 348 (28 Pac. 135); Johnston v. Shofner, 23 Or. 111 (31 Pac. 254); Pruitt v. Muldrick, 39 Or. 353 (65 Pac. 20). That the proceedings are to be regarded, for the purpose of trial, as an action at law, rather than a suit in equity (Wilkes v. Cornelius, 21 Or. 341, 23 Pac. 473), does not affect the question. From the nature of the case, the method of procedure usually provided for probate courts is more nearly conformable to proceedings in equity than in law. Such courts, however, do not have either original equitable or *237common-law jurisdiction, and in the disposition of the business before them they observe and apply legal and equitable rules, as the case may require and the statute provide.
3. The second question is one of fact. There is sufficient evidence tending to show that the notes in question were the obligations of the firm of Morgan & Stowell to carry that question to the jury. Stowell testified that the consideration of the notes was money borrowed by the firm for the purpose of conducting its business and discharging its debts, and that the notes in question were given in renewal of previous obligations incurred with the knowledge, consent, and acquiescence of Morgan. Dooley, the assistant cashier of the. bank, testified that he presented the particular notes in question to Morgan for payment, and Morgan said that he was unable to pay them at the time, but would take them up at some later date. The cash book of the firm of Morgan & Stowell, which was kept by Morgan, its entries being chiefly in his handwriting, shows the receipt of the consideration for the $1,000 note, and also the firm’s payment from time to time of interest on that sum and on the $2,500 note. There was other evidence tending in the same direction, hut this is sufficient for the present purpose.
4. The important and difficult question is whether this proceeding is barred by the statute of limitations. The $1,000 note is dated April 25, 1894, and the last payment on the $2,500 note was made March 24th of the same year. The proceeding was instituted in the county court on July 20, 1901, more than seven years thereafter, and is therefore barred unless the running of the. statute of limitations was suspended from the time the plaintiff’s claim was presented to the executrix until the bank-was notified that it had been rejected. By Section 387, B. & C. Comp., an action cannot be maintained against an executor or administrator until the expiration of six months after the granting of letters testamentary or of administration, and by Section 388 such an action cannot be commenced until the claim of the plaintiff has been duly presented to the executor or administrator, and by him disallowed. Section 20, B. & C. Comp., provides that, when the commencement of an action is stayed by statutory *238prohibition, the time of the continuance of such prohibition shall not be a part of the time limited for the commencement of the action. It seems, therefore, that the time a claimant is prohibited from commencing an action on his claim, either because the six months after the granting of letters testamentary or of administration have not expired or because the question of the allowance of the claim is pending before the executor and undecided, will not be deemed a part of the time limited for the commencement of the action thereon. During the first six months after the granting of letters one holding a claim against an estate, except possibly when it comes within the provisions of Section 18, is prohibited from suing thereon in any event; nor can he commence his action after the expiration of such time until the claim has been disallowed. He must, of course, present his claim before it is barred by the statute of limitations, otherwise the executor or administrator is hot authorized to allow it: B. & O. Comp. § 1161. The statute cannot be tolled by a mere failure to present th'e claim. After it has been presented, however, the claimant, is prohibited from suing thereon until it is disallowed, and the operation of the statute will be suspended during the time of such prohibition: Blaskower v. Steel, 23 Or. 106 (31 Pac. 253); Nally v. McDonald, 66 Cal. 530 (6 Pac. 390); 19 Am. & Eng. Enc. Law (2 ed.), 216.
The claim in this case was presented for allowance in April, Í897. It was not then barred by the statute of limitations. Until it was disallowed by the executrix, or until she had retained.it a reasonable time without acting on it, no action could have been commenced by the claimant to recover thereon. Dining the time it was properly pending before the executrix, the cause of action was stayed by. the statute, and therefore is not a part of the time limited by the general statute of limitations for the commencement of an action on the claim. An executor or administrator is entitled to a reasonable time after the presentation of a claim in which to examine it to ascertain whether he will allow or disallow it, but, unless he takes some action thereon within such time, the claimant, at his option, may treat the claim as disallowed, and act accordingly: Goltra v. Penland, 45 Or. 254 (77 *239Pac. 129). This right, however, is believed to be personal to the claimant, who may waive it, and permit the claim to remain in the hands of the executor for further consideration. If he does so, and it is afterwards rejected, the right to commence an action will date from the time of rejection, and not from the time the claimant might have elected to treat the claim as disallowed and commenced an action if he had so desired. The claim in suit was indorsed “disallowed,” but the time when such indorsement was made is not stated. The notation is not dated, and there is no proof whatever on the subject. The statute provides that whenever a claim is disallowed by an executor or administrator he shall indorse thereon the words “Examined and rejected,” with the date thereof, and sign the same officially (B. & C. Comp. § 1161), but whether, in such case, the claimant should be notified thereof, either personally or constructively, by the executor or administrator filing a proper report with the county court, as required by the statute, is not clear.
But however that may be, and whatever may be the rule in this regard in ordinary oases, we are of the opinion that under the facts of this particular case the executrix can not be permitted to insist that 'the claim was rejected by her prior to the time the bank or its assignee was advised of her action. When the claim was presented, the bank was advised in writing that it would be notified of the action of the executrix thereon as soon as had. Some seven or eight months later it was assured that the estate “would undoubtedly pay every dollar it owes,” but it would be necessary to sell some of the real estate, which the executrix was endeavoring to do, but could not rush the matter without such a sacrifice as would be injurious not alone to the estate but to the creditors, and they were therefore requested, “in their own interests, to be patient.” By these statements and promises and the conversations with the attorney of the estate the bank was lulled into security, and did not press the payment of its claim. Belying upon such promises and statements, and in view of the general condition of the estate, and its desire that the largest amount possible should be realized from the assets, it was indulgent, and the executrix ought not now be permitted to insist that its rights have been injuriously affected by some *240secret action of hers in rejecting the claim. If it was to be rejected because not an obligation of the estate, the proper indorsement should have been made thereon, the bank advised by the return of the claim, or in some other manner, of the action of the executrix, so that it could have taken such steps as it might deem proper to protect its interests. This was not done, nor did the. executrix file with the county court, as required by law, a report of the claims presented against the estate. On the contrary, the claim remained either in her possession or her attorney’s, and it was not until the statute of limitations had run that the bank’s assignee was advised that the claim had been rejected. We are of the opinion, therefore, that the time during which the claim was in the hands of the executrix for examination, without notifying the bank that it had been rejected, should not be taken as a part of the time limited by the statute for the commencement of the action thereon.
It follows that the judgment of the court below should be reversed, and it is so ordered. Reversed.