Court Opinion

ID: 8046950
Source: CourtListenerOpinion
Date Created: 2022-09-09 04:00:24.905125+00
Date Added: 2024-06-11T16:37:32.236294
License: Public Domain

Bellows, J.
Under the circumstances of this case we think that nothing had passed to these creditors, except Hardy and Willoughby, before the service of this process, and that the lien of this plaintiff was not affected by the subsequent assent. It is not like a case of an assignment to a third person in trust for creditors, with an acceptance of the trust and a promise to execute it; in which case it has been held that the legal estate passes, and vests in the trustee ; and a court of equity will compel an execution of the trust. 2 Kent Com., secs. 533, 729. But this is a case where the assignments are directly to the creditors themselves, and have never been delivered, or assented to. It is true they were placed in the hands of the trustee to he delivered; but until a delivery or its equivalent the trustee’s authority could at any time be revoked by the assignor; he, the trustee, being the agent of the assignor, and in no sense the agent o'f the creditor. It stands, indeed, like a case where the principal places money in the hands of his servant or agent, to pay a *187debt; and until it is paid tbe money must be regarded as still in possession of tbe principal, and subject to bis direction. So in this case, tbe trustee being merely tbe servant or agent of tbe debtor, and in no privity with the assignee, nothing passed from the assignor, but a power which he might at any time revoke.
The cases cited for the trustee in respect to assignments to third persons, in trust for creditors, do not, for the reasons suggested, apply here, and it is therefore unnecessary to determine where is the weight of authority upon the vexed question, whether in such cases the assent of creditors will be presumed; because we are satisfied that where the transfer is directly to the creditor, his assent must be shown. 2 Kent C091., 9th ed., secs. 533, 729, note c; Nichol v. Mumford, 4 Johns. Ch. 529. In Williams v. Everett, 14 East 582, where funds were remitted to a house in London to be applied to the payment of certain creditors of the sender, one of whom was the plaintiff, who, on being advised of what was done, called upon the agent and asked for payment, which was declined, he refusing altogether to act upon the directions received; in a suit against the agent, for money had and received, it was held that it would not lie — the court upon full consideration deciding that until the agent had come under some engagement to the creditor to apply the assets, the directions might be countermanded, and therefore they were held to the use of the remitter.
A similar doctrine is laid down in Acton v. Woodgate, 2 Mylne & Keene 492, and Smith v. Keating, 6 M. G. & S. 136, 158; Harland v. Binks, 15 A. & E. (N. S.) 713, and cases cited, and note; and the doctrine in those cases is applied to cases where the assignments were to third persons in trust. The case of Oxnard v. Blake, 45 Maine 602, is also in point. There it was held that where there were several mortgages to different creditors, as collateral security, made by the debtor, and recorded without the knowledge of such creditors, the one that is first ratified will have priority. The cases of Hardy and Willoughby, however, stand upon different ground, for the facts stated show an assent to the assignments to them, which will give them effect against the attachment. Harland v. Binks, 15 A. & E. (N. S.) 713. That was an assignment to a third person in trust, for such creditors as should come in and execute the deed; and under it the trustee took possession. A creditor applied to the trustee for an explanation, and having received it, he said he was satisfied, and took no steps to obtain payment; and it was held that this was a sufficient assent.
In respect to the assignment in trust for the wife, enough is not stated to enable the court to decide; for it does not appear whether the money of the wife which was used by the husband was so held by her that he could have reduced it to possession; or whether he did or did not attempt to do so. Had the money been held by the wife to her sole and separate use, and used by the husband without authority, he might have been compelled to restore it. Clancy on Husband and Wife 350, 354. On the other hand, if not held to her sole and separate use, and the husband had once reduced it to possession, it would be difficult to see how any obligation to refund *188it coulcl afterward arise. What the facts are is not stated, and a further examination of the subject would not be profitable.
The only question remaining is in respect to the pledge to the trustee, and that must turn upon the point,» whether the administration bond extends.to the debt due from the administrator to the intestate. By statute, a debt due the intestate from the administrator is assets in his hands, and must be accounted for, as other debts ; Comp. Stat., ch. 168, sec. 9 ; and the decree of the probate court charges the principal debtor with the amount of such debts ; and we must presume that he was rightfully charged. Under such circumstances the sureties would be held. In Gookin, J., v. Hart, 3 N. H. 392, it was laid down that a suit may be maintained upon a probate bond, “where the executor or administrator, having assets, and being bound by law to pay a debt, neglects or refuses to pay it when demanded; or where he neglects or refuses to pay on demand a dividend ordered by the judge of probate, by a decree of distribution of an insolvent estate, to be paid to a creditor;” or where he neglects to pay on demand to an heir, a share in the estate ordered by the judge of probate to be paid; and so it is held in Judge of Probate v. Heydock, 8 N. H. 491, where it was held that the sureties in an administration bond were liable for the proceeds of land sold in another State, and which the administrator was directed by the probate court of that State to pay to such persons as the probate court in this State, where the will was originally proved and allowed, should direct; the administrator having been charged with the amount in the settlement here of his administration account. This was put upon the ground that upon the decree of the Vermont court, to pay the money according to the decree of the court where the principal administration was, it at once became assets in his hands here, which he was bound to account for according to his bond, although the sureties might not have anticipated it when they entered into the obligation ; and the court held the decree of the probate court here to be conclusive, although it did not appear whether the proceeds of the Vermont administration were actually transferred to their jurisdiction or not, or whether they were squandered by the administrator before the decree of the Vermont court of probate. So in this case, the debt due from the administrator is by law assets in his hands, and the amount is fixed and determined conclusively, as against the administrator, by the decree of the probate court, to be paid to the creditors, or to the heirs and legatees; and for a neglect to account for it according to law, the sureties must be liable on their bond. See, also, Smith v. Jewett, 40 N. H. 513 ; Gottinger v. Taylor, 19 N. Y. 150; Gottinger v. Smith, 5 Duer 566, and Potter v. Titcomb, 7 Greenl. 302.
Whether it is open to the sureties to show .that the claim of the estate against the administrator was, ever since his appointment, of no value by reason of his insolvency, as held in Harden v. Joick, 2 Stockt. Ch. 269 (N. J.), and Piper’s Estate, 15 Penn. 533, and Gottinger v. Smith, 5 Duer 566, it is not now necessary to inquire, as no such state of things is suggested.
Let these views be certified to the trial term for further proceedings.