Court Opinion

ID: 3837098
Source: CourtListenerOpinion
Date Created: 2016-07-06 08:06:02.115627+00
Date Added: 2024-06-11T14:14:14.846598
License: Public Domain

Argued on the merits July 7; reversed July 14; rehearing denied September 13, 1938                              ON THE MERITS                              (81 P.2d 140)
In Banc.
As presented on this appeal, this is a proceeding to remove William C. Winters and Albertina Dahlke, as administrator and administratrix, respectively, of the estate of Herman Winters, deceased. The petitioners are Herwin Winters, Fred Winters, Louis R. Winters, Herbert Winters, Viola Zabel and Omar Winters. Herwin Winters is the son and sole heir at law of Bernhardt Winters, a deceased brother of Herman Winters, decedent herein. Fred and Louis E. Winters are the sole heirs at law of Albert Winters, a deceased brother of said decedent. Herbert and Omar Winters are sons and Viola Zabel is a daughter of Henry Winters, a deceased brother of said decedent. William C. Winters and Albertina Dahlke are prosecuting this appeal from an order removing them as administrator and administratrix respectively and appointing A.C. Callan administrator de bonis non herein. By the terms of section 7-502, Oregon Code 1930, said William C. Winters and Albertina Dahlke should be designated as appellants herein and the opposing parties should be designated as respondents; but to avoid a confusion of terms, the appellants herein having been respondents in the probate court, we will refer to them as the administrators and we will continue to use the designation of *Page 646 
petitioners in referring to the petitioners in the trial court.
The question to be determined is whether a sufficient showing has been made by the petitioners to justify the removal of the administrators and the appointment of Mr. Callan.
In their petition the petitioners specifically named The United States National Bank of Portland, Oregon, as a competent institution to be appointed administrator de bonis non herein. During the course of the hearing upon said petition to remove said administrators, the administrators, as an offer of compromise, stated that in order to determine the matter amicably, Mrs. Dahlke would resign and would join in consenting to the appointment of the First National Bank as coadministrator with Mr. William C. Winters. This offer of compromise was rejected.
As stated, Mr. Callan was appointed despite the evident preference of all interested parties for the appointment, if one should be made, of one of the banks of Portland, and despite the fact that he was a witness for the petitioners and testified upon the contested subject of the value of a particular apartment house placing a value thereon appreciably higher than the value given by the witnesses called by the administrators.
Originally, the petition upon which this proceeding rests embraced four principal issues. The nature of the petition is that of a bill of discovery and the first of the principal issues was presented and heard upon that phase of the case separately and apart from the proceeding now under consideration. The second issue presented in the petition is that of an alleged trust alleged to have been created in favor of certain of his nieces and nephews by deceased with respect to property *Page 647 
inherited by deceased from his mother. This issue was abandoned by petitioners at the hearing of the present proceeding in the probate court. The third issue is that of whether the interest of William C. Winters and Albertina Dahlke, the administrator and administratrix respectively, originally appointed herein, are so adverse and hostile to those of the petitioners herein as to disqualify them from acting as such administrator and administratrix. The fourth issue arises upon the allegation that decedent was the owner of furniture and other personal property of the Embassy hotel, which has not been accounted for, or set forth, and described in the inventory filed by the said administrators, and upon the further allegation, —
"That your petitioners further believe and, therefore, allege that other assets of the decedent have not been listed in the inventory on file herein, the exact character and nature of which can only be disclosed by a full hearing as herein prayed for."
Aside from the furniture of the Embassy hotel, the property claimed by petitioners to have been owned by deceased at his death and omitted from the inventory consists of certain real property in Douglas county, certain other real property in Hoquiam, Washington, nine hundred and fifty dollars represented by a check drawn in that sum upon the funds of deceased on August 19, 1936, in favor of Herman Dahlke; six hundred and twenty dollars and twenty-four cents ($620.24) being an amount for which alleged excessive credit was given to William C. Winters upon the books of account of Herman Winters which were kept by said William C. Winters with reference to accrued rental from the Premier hotel of which deceased and said William C. Winters were joint owners; nine hundred and seventy three dollars and eighteen cents alleged excess of money *Page 648 
disbursed of funds of decedent for the benefit of Albertina Dahlke; four thousand dollars par value of Vancouver Commercial Hotel bonds delivered to Albertina Dahlke; Studio bonds delivered to the wife of William C. Winters; twenty-one thousand dollars par value Vancouver bonds claimed by Herbert Dahlke; and unpaid rental upon the Palace hotel due from Herbert Dahlke.
The explanation of the administrators with respect to the furniture of the Embassy hotel is that practically all of the furniture of that hotel, belonging to decedent at his death, was built into the apartment house, being in the main, refrigeration, electric stoves, wall beds and equipment of that nature; and that the listing and appraisal of the apartment house itself complied with the requirements of an inventory.
We realize that to support this explanation we are required to determine what showing is in the record relative to the ownership of the furniture not so affixed to the building. Upon that subject, the only testimony is to the effect that Herbert Dahlke and the tenants of the hotel owned the furniture except the hall carpets, the refrigeration, the wall beds and the electric stoves. It is true that the petitioners comment upon the fact that two weeks after he had executed a bill of sale to said Herbert Dahlke conveying all personal property, etc., of said hotel to said Dahlke, decedent executed a renewal mortgage to H.B. Davis covering the electric ranges, refrigerators, carpets, beds and all other furniture, fittings and equipment installed and situate in the apartment, etc. Mr. Davis testified, however, that he understood that the items included in the mortgage were part of the building.
As to the Douglas County real property not included in the inventory, the interest of decedent therein was *Page 649 
an undivided one-eighth thereof. His sister, Mrs. Albertina Dahlke, also owned an undivided one-eighth interest therein. Mr. William C. Winters testified that he employed a cruiser to examine the property and make report thereon and that the information thus obtained was to the effect that the property in question was not of sufficient value to justify the payment of taxes thereon. This is not denied or controverted.
The property in Hoquiam, Washington, is beyond the jurisdiction of the Oregon probate court. Mr. William C. Winters testified that the attorney then representing him, but who is now deceased, advised him that the rentals therefrom were not part of the Oregon estate and for this reason he kept them in his own individual bank account. Complaint is made because the administrators did not institute administration proceedings on this property in the state of Washington. No loss to the estate has been shown by the delay in that respect.
On or about the 19th day of August, 1936, a check was drawn upon the account of decedent by William C. Winters, who was authorized generally to sign checks for decedent. This check was in the sum of $950, and drawn in favor of Herbert Dahlke. The purpose of this check was to guard against the eventuality of decedent's death causing delay in payment to the O'Donnell estate of rentals collected by decedent as agent for that estate.
We quote from the testimony of William C. Winters:
"Q. Now, you testified on direct examination, on the 19th of August, 1936, that you issued a check to Herbert Dahlke for $950 to cover any rentals which you might have on hand belonging to the O'Donnell estate in case of the sudden death of Herman Winters, is that correct?
A. Right. *Page 650 
Q. Have you ever received a repayment of that sum from Herbert Dahlke?
A. I have."
Mr. William C. Winters' testimony further discloses that thereafter he acted as agent of the O'Donnell estate in making collection of rentals upon the Fine Arts Building and in making returns to the O'Donnell estate as his brother, the decedent, had done.
There is no contradiction in the record of the showing thus made that the funds involved in the transaction of the nine hundred and fifty dollar check to Herbert Dahlke were not funds of the estate in suit but those of the O'Donnell estate.
Petitioners complain of the omission from the inventory herein of the income from the Premier hotel from January 1 to March 18, 1936, in the sum of $620.24 because of an alleged excessive credit taken in such sum by William C. Winters in his account with decedent. Mr. William C. Winters testified that the account for rentals was settled and discharged and a payment made upon his salary as bookkeeper for decedent by the transfer and delivery to him by decedent of bonds for the face value of $7,500.
The item of $973.18, claimed by petitioners to be the excess of moneys disbursed out of the funds of decedent for the benefit of Albertina Dahlke and due from her to the estate of decedent, is based upon the ledger account of decedent, pertains and purports to reflect the condition of that account prior to the operation of the Lorraine hotel February 27, 1936, at which time decedent transferred his interest in said hotel to Mrs. Dahlke.
Decedent lived with his sister Mrs. Dahlke. The relationship was very close. The nurse attending him testified that in the closing hours of his life, while *Page 651 
sleeping, decedent would repeat and rerepeat the name which through the years he had evidently applied to her, "Tena". Mrs. Dahlke's testimony impresses one with the complete and absolute confidence she reposed in decedent.
The balance thus claimed by petitioners does not appear to have been urged at the hearing and its amount is comparatively so small when we consider the value of the estate of decedent appraised at $870,865.63, that we cannot attribute bad faith on the part of the administrators in failing to take cognizance of the purported balance.
The delivery of the Vancouver Commercial Hotel bonds to Albertina Dahlke and Herbert Dahlke, and the delivery of the Studio bonds to Mrs. William C. Winters are shown by the only direct testimony on the subject in the record.
There is no testimony that decedent's mental faculties were impaired until from thirty-six to forty-eight hours before his death. There was an offer of proof to the contrary by petitioners, which was rejected by the trial court, but the petitioners have not appealed, and for that reason no consideration is given to such offer of proof.
An alleged balance of $410.48, which petitioners claim is shown by the ledger accounts of decedent to have been due decedent's estate from Herbert Dahlke and wife arising from the operation of the Palace hotel is also made the basis of the charge of nonfeasance on the part of the administrators in failing to include said alleged account in the inventory herein.
This and all the other items upon which there might be any question are fully protected by the administrators' undertaking which they have furnished in the sum of one hundred and seventy thousand dollars. *Page 652 
There is no dispute that in order to render the administrators subject to removal because of an omission, or because of omissions of assets from the inventory, the same must be made in bad faith with intent to take advantage of the estate.
We think that this record does not disclose bad faith on the part of the administrators and for that reason error was committed in ordering them removed.
What we have said upon the contested features of this case must be deemed to be without prejudice to a presentation of further claims thereon, except as to the propriety of the order in question here, which is the order of removal of the administrators.
The adverse interests of the administrators are not obstacles to the institution and maintenance by the heirs, creditors and others interested of a suit based upon a claim or claims due the estate: Hillman v. Young, 64 Or. 73, 90
(129 P. 124, 125); Riddle v. Isaacs, 97 Or. 404 (192 P. 398).
For the foregoing reasons, the order of the probate department of the circuit court removing the administrators and appointing Mr. A.C. Callan administrator de bonis non is reversed and this proceeding remanded with instructions to reinstate William C. Winters and Albertina Dahlke as administrator and administratrix, respectively, of the estate in suit. *Page 653