Court Opinion

ID: 6685102
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:32:04.858565+00
Date Added: 2024-06-11T16:00:56.780718
License: Public Domain

HamiltoN, Judge,
delivered tbe following opinion:
1. Tbe first matter to be determined relates to tbe jurisdiction of tbe court as dependent upon tbe citizenship of tbe parties. Tbe evidence seems to show that plaintiff Carlos Borda is a resident of New Fork, and that plaintiff Leopoldo Borda is a resident of France. It is true that neither of them stays at tbe home in question all tbe time, and that both of them have been commorant in Porto Rico during tbe past winter. Both of them have property interests here, and Carlos Borda has bought a bouse in San Juan. The question of residence is one of intention, and that is often difficult to ascertain. In tbe case at bar tbe old English couplet of “a settlement is retained until a new one is gained,” expresses tbe correct legal principle that an old residence is retained until it is proved that a new one has been obtained. To put the case more strongly for the defendant, tbe residence of the plaintiffs, was in New York and France some time ago, and tbe evidence is not at all convincing that it has since been changed. The rulé is that domicil is changed only by abandonment of tbe first place 'of domicil with tbe intention not to return, and by taking up residence in another place with tbe intention of permanently residing there. 9 R. C. L. 542. It may be added that not long since tbe defendant himself, in an affidavit in cause No. 914 in this court, stated that Carlos Borda was a resident of Bay Shore, Long Island, and that Leopoldo was a resident of Paris, France. It would seem from tbe evidence to be a fact, therefore, that this was at one time true, and there 'has been no satisfactory proof of any change. The court is therefore satisfied that it has jurisdiction of the matter, so far as relates to the parties. '•
*1442. This is a suit in equity for an accounting, brought by two cotenants against the third, who is alleged to have been in the management and control of the common property and to have raised and disposed of a crop of sugar cane for the joint benefit. The basis of the bill is that a trust is involved to handle the property and its proceeds for all concerned. Mr. Freeman says that courts of equity have concurrent jurisdiction with courts of law of all matters of account between coten-ants, and that a cotenant cannot be deprived of his recourse in equity because there is an adequate remedy at law, the point being that the facilities of a court of equity are superior in matters of account. Freeman, Cotenancy & Partition, § 321; 7 It. C. L. § 102. Where there is a fiduciary relation, equity will entertain jurisdiction of a suit for accounting, although the account is neither mutual nor complicated, and this applies to cotenants. Cotenancy would seem to be a quasi trust relationship. Pom. Eq. Jur. § 931; 39 Cye. 185.
It is true the contested items are few in number, being two charges for rent of bulls, — one for rent of portable track, and two for attorneys’ fees and expenses. It often happeiis that items apparently simple are totals of complicated circumstances, and in the case at bar there is the element of admitted representation by one cotenant of the interests of two others as well as his own. The law of Porto Pico affords special rules on the subject of cotenancy. Civil Code, §§ 405, 401". The bill, therefore, would seem to present a proper case for a bill for an accounting.
3. The relation of quasi trustee is governed by similar principles, but is not the same thing as the relation of a formal trustee. The word shows this, for “quasi” means simply in *145the nature of, and may have many shades and varieties of meaning. Thus, in the case at bar the proof seems to be that the defendant was the only one of the three cotenants in Porto Eico, and took charge of a valuable property at the expiration of a lease, and managed it with the consent, express or implied, of the other two cotenants. The result has been that these other two did not advance any money for crop purposes, and that the defendant did advance a good many thousand dollars, besides giving his personal skill and attention to the management of the plantation. The result has been greatly to the advantage of all three owners. The dispute between them now relates to charges made by the defendant in his management, plaintiffs alleging that certain items should not be charged at all, because they related to personal matters of the defendant, and not to the joint property. In such a case the rules of trusteeship are not to be strictly required. For instance, ordinarily trustees are under the obligation to keep accurate accounts and render them whenever demanded. 29 Cyc. 464. In the ease at bar no accounts were kept except by the defendant for his own purposes, and from these upon demand he made up the account now in dispute. A quasi trustee in a case such as the one at bar has fulfilled his duty if he has kept memoranda sufficient to make up an account when requisite. He is in possession primarily as owner and in his own interest, and is entitled to all the rights of individual ownership except that he must so act that'he can make up and supply a proper accounting with his cotenants.
4. Some questions of pleading may be decided here. Thus, the defendant upon the hearing sought to prove that there was a mistake against himself in the account which he rendered to his cotenants, and argues that this should be corrected. He *146does not file any cross complaint or pleading of that nature. In this respect, however, the proceedings on a hill for accounting-in equity are different from those in other cases. The defendant does not have to file any account until it is first determined by a preliminary decree that he should account. 1 C. J. 639. When this stage is attained the matter is referred to a master to state the account; and justice will be done upon the evidence, whether in favor of plaintiff or defendant, without reference to the condition of the pleadings. 1 C. J. 639; Langdell, Eq. Jur. 90. This is much the same course that is taken when a receiver, who is a trustee par excellence, files his account. If it should be determined there should be an accounting, that is to say, that the account already passed between the parties is not correct, then the whole matter will be reopened for consideration.
5. Taking up, therefore, the question whether the account as rendered before the suit was correct, it is attacked in the first place in the item of $1,260 charged the Hacienda Esperanza, the joint property, for the rent of bulls which belonged to the defendant himself. There is no doubt that a trustee cannot make money out of his trust estate. He must act for the beneficiaries, and not for himself. He cannot derive profit except the compensation allowed by law. 39 Cyc. 296. Trustees holding a position of trust and confidence are not allowed to make profit from their office or to use the trust property for their own personal advantage. Perry, Trusts, § 427.
It is nevertheless true that, while one cannot take advantage of a fiduciary relation, the converse is equally true; that is to 'Say, that the opposing party cannot mulct the quasi trustee where he has bona fide expended property for the benefit of *147tbe so-called trust. Tbe principle may be illustrated by a case of where a trustee buys up an outstanding debt for tbe benefit of tbe cestuis que trustent and they refuse to take it or pay tbe purchase money; in such case. they cannot afterwards, when tbe purchase turns out to be beneficial, claim tbe benefit for themselves. Perry Trusts, § 428. In tbe case at bar tbe plaintiffs declined to advance money which would necessarily be required to operate a large sugar plantation, and thereby tbe defendant, to preserve bis own interests as well as theirs, bad to do so in a very large amount. It was in this way that be bought bulls and furnished others that be owned for this purpose. If plaintiffs would not advance tbe money necessary to buy tbe bulls, they cannot complain that tbe defendant did so in bis own name and charges a reasonable amount for their use. Defendant testified that be sold them for what be paid for them, but tbe connection shows that he does not mean that he charged $1,260 for tbe rent of $13,334.40 worth of cattle. Tbe amount charged was actually less, and tbe cattle sold were actually less, due to loss from death and otherwise. There is nothing before tbe court to show that this charge was improper, and tbe account cannot be reopened in this respect. Tbe same will bold true of tbe item of $3,104.22 for cane hauling and tbe like.
6. Tbe matter of attorneys’ fees stands on'a different footing. Defendant did not keep regular accounts, and did not take definite receipts from attorneys, covering in so many words services rendered to tbe Hacienda Esperanza alone. He paid amounts in bulk, and has attempted to separate so much as belonged to himself personally from those belonging to tbe Hacienda. Tbe result, however, was not satisfactory. Tbe, *148presumption against a trastee when be mixes trust funds with bis own personal funds is not strictly applicable in tbis case, but it cannot be said that tbe defendant bas clearly separated tbe items of tbe attorneys7 expense. Thus, tbe amount paid Muñoz Morales cannot be held to cover only tbe Hacienda litigation. Tbe plaibtiffs were owners libe bimself, and bad tbe right to be represented by counsel in disputes, and defendant cannot charge up against them tbe expense of bis differences with bis co-owners. Indeed on tbe trial be did not attempt to do so, but be bas not drawn a satisfactory line between what was personal • and what concerned tbe estate that be represented. No satisfactory evidence was introduced on tbis point, and tbe court is not in condition to apportion tbe charge. It would seem that one half tbe $2,000 might well be charged against tbe Hacienda, but it is not clear that more should be. Similarly as to tbe charge of tbe attorney Molina. That all of tbis should be charged against tbe Hacienda is not clear, although no doubt some of it should be. As to tbe $110 in Borda v. Plazuela Sugar Co. 9 Porto Rico Fed. Rep. 64, this would seem to be a proper charge against tbe Hacienda, inasmuch as tbe suit was brought to carry out tbe contract made for joint benefit with the Plazuela Sugar Co., and tbe litigation, including tbis payment on tbe injunction bond, was due to the intervention of .the plaintiffs, which in effect they after-wards abandoned- by compromise agreement satisfactory to all interests.
On tbe other band, no evidence was offered as to tbe counterclaim, and that need not, therefore, be considered.
It follows that there is no reason for disturbing tbe account heretofore rendered in any regard except in tbe matter of at*149torneys’ fees, to wit, tbe item of $4,000. Some of this wás properly charged, but tbe court bas no means of determining bow mucb, and an accounting will therefore be ordered in this, regard.
Unless tbe parties agree otherwise, a decree will be entered referring an accounting in this matter to a special master according to tbe usual practice of courts of equity.
It is so ordered.