Price v. Wilkinson's Ex'rs , 10 Ala. 172 ( 1846 )

ORMOND, J.

John D. Wilkinson, the testator of the defendant in error, made his will, intending as it would appear, to make a final disposition of all his estate, but died intest ate as to his land, the will being attested by but two witnesses. It appears that the land was sold by order of the orphans’' court, on the petition of the defendant in error, but for what purpose, or upon what allegation by the executor, does not appear, nor is the petition, or the proceedings had upon it, a part of this record. Upon the final settlement, certain minors, grand children of the deceased, to whom, by the will, $100 each had been given, as their portion of the estate, appeared by their guardian, and objected as it would seem, to the sale of the land, because they were not parties to th e petition, and had no notice of the application for the sale of the land, and that no citation issued to them. The court held that they had no interest in the land, and were not entitled to notice. This, considered as a legal proposition, was clearly erroneous. The testator having died intestate as to his land, it descended upon his heirs at law, of whom these minors were a part, and being directly interested, should have been parties to a petition for the sale of the land, and cited to appear. But whatever effect this omission may have, upon the proceedings for the sale of the land, as long as the order for its sale is in force, not reversed or vacated, the proceeds of the sale, is assets in the hands of -the personal representative, and the objection that the sale was irregular, or unauthorized, cannot be taken at the final settlement.

The question which it appears was intended to be made in the court below, and here, was, as to the disposition of the proceeds of the sale of the land ; the plaintiff in error contending that as there was personal property sufficient for the payment of the debts of the deceased, they were entitled to their distributive share of the proceeds of the sale of the land, as to which their grandfather died intestate, whilst the court permitted the executor to appropriate it to the payment of the debts of the deceased, thereby exhausting the fund, and leaving nothing for distribution, although it was admitted there was a sufficiency of personal property to pay all the debts of the deceased.

The right.of the court, thus to direct the appropriation of the avails of the land, is defended in this court, upon the ground, that the orphans’ court has the power to marshall the assets, and to resort to lands descended, for the payment of debts, when there is an insufficiency of personal property, to discharge the specific legacies, as well as to pay the debts.

The marshalling of assets, as it is called, is a familiar doctrine of the English chancery, and is an arrangement, or setting in order, by the court of the assets of a deceased person, so that all claimants may be satisfied. Thus, if a specialty creditor, whose debt is a lien upon the real estate, obtained satisfaction out of the personal assets, a simple contract creditor, who cannot resort to the real estate, will in equity, be placed in the condition of the specialty creditor, the payment of whose debt has exhausted the fund, from which his debt would otherwise have been satisfied.

This doctrine has been applied to pecuniary legatees, when fthe personal' estate has been exhausted by the payment of specialty creditors, as otherwise the intention of the testator would be defeated. The whole doctrine rests upon that principle of equity, that when one claimant has more than one fund to resort to, and another only one, the first shall resort to that fund, on which the second has no lien. For a full exposition of the rule, and its various modifications, see Clifton v. Burt, 1 P. Will. 678, and the elaborate note of Mr. Cox; also Bam. on Assets, 374, 1 Story’s Eq. 531. How far this rule, as it regards such cases as this, has any application in this State, where specialty debts, and debts by simple contract, are placed upon the same footing, as it respects the right to satisfaction, out of the property of the deceased; or whether if it obtains here, it must be confined to those cases,where one creditor has an actual lien, (as for example, a mortgage,) is a most important question, which we shall not now discuss, because it is very clear, the orphans’ court has no power to marshall assets.

The only powers which the orphans’ court can rightfully exercise, are those which are conferred upon it by the statute calling it into existence, or which necessarily result from the subject over which it is authorized to exercise jurisdiction. The powers conferred on it, are not adequate to, nor were they conferred for any such purpose as the marshalliug of assets, which is purely a creature of a court of equity. To the exercise of such a power, it is absolutely necessary to charge land, with the payments of debts, and legacies, which it is not primarily responsible for, which could only be, by directing the land to be sold for this purpose. Yet its power to sell land, is distinctly and plainly defined. It may, on the' petition of the executor or administrator, direct its sale, when the estate is entirely insolvent, or when the personal property is insufficient for the payment of the debts — or where the real estate cannot be justly divided without such sale. [Clay’s-Dig. 224, § 16,] So it may, on the petition of any one interested, and proof of the fact, that the estate or those interested in it, will be less injured by a sale of land, than of slaves for the payment of debts, direct a sale of the land of a deceased person. [Ib. 195, § 18.] It is perfectly obvious, that neither of these statutes, conferred on the orphans’ court the power to sell land, which had descended to the heir, for the protection of a legatee, whose legacy would otherwise be diminished, or exhausted by the payment of debts — which would be in effect directing the sale of land descended to the heir, for the payment of a pecuniary legacy.

Nor is any such power derivable, from the subjects over which it has jurisdiction, as the probate of wills, grant of letters testamentary, and of administration, and the settlement and distribution of estates. In the discharge of these duties, it proceeds according to law, under the direction of the statutes passed for its government, and can exercise no power of an equitable nature, unless conferred by statute.

It would seem from the record, that the plaintiffs in error applied to the orphans’ court, for distribution of the proceeds of the sale of the land, but as the orphans’ court had no power to direct the sale of the land which had descended to the heirs, it results that it cannot distribute the proceeds of the sale among them, as the infants cannot waive the irregularity of the sale. Such a waiver could be made alone in equity, if the chancellor ascertained that it was to their interest to take the proceeds of the sale, and that in equity they were entitled to the money.

It results from this examination, that there is no error in the record, of which the plaintiffs in error can complain, the decree of the orphans’ court must therefore be affirmed.