Moore v. Winston's Adm'r , 66 Ala. 296 ( 1880 )

STONE, J.

The Probate Court is a court of law, not a court of chancery; and it has been many times affirmed in this court, that that court does not possess chancery powers. 1 Brick. Dig. 440, §§ 182 to 189 ; lb. 647, §§ 120, 123. In the-settlement of insolvent estates, that court is possessed of a speedy, complete, and relatively inexpensive jurisdiction, which is exclusive, unless satisfactory reasons exist and are shown why that court, by reason of'its want of equitable jurisdiction, can not administer equitable relief. It should be a clear and strong case to justify the transfer of the settlement of an insolvent estate to the Chancery Court. Still, there may be cases which would justify it.—Hemphill v. Moody, 64 Ala. 468; Thames v. Herbert, 61 Ala. 340, 344.

The present record presents the case of a pending settlement of an insolvent estate in the Probate Court. Moore became the owner, by. purchase, of certain claims against the insolvent estate, which had been filed by Ligón as the-administrator of Walker. These claims were filed within nine months after the declaration of the insolvency, and no exceptions were filed to their allowance within the twelve months allowed by the statute. The defense set up against the allowance of these claims was payment, or accord and satisfaction, made by Steele, a co-maker of the notes, long before the report of insolvency; even before the death of Winston, the insolvent intestate. This defense against the allowance of these claims was attempted to be made in the Probate Court, and the case was brought here for -revision. — Thornton v. Moore, 61 Ala. 347. We held the filing was sufficient, and that the attempted defense was unavailing. We said: “The objection to the claims, in the form of a plea presented by the appellant, was not filed within twelve months after the declaration of insolvency, and the matter of objection existed when the claims were filed. This plea was stricken from the files, on the motion of the appellee, and we think properly.” We had previously said in the same case: “The allowance of a claim, duly filed against an insolvent estate, is a right the statute secures to the creditor, unless objections, directed to its merits, are filed within twelve months after the declaration of insolvency. As to all matters of objection addressed to the validity or justness of the claim, which exist at the expiration of the period prescribed for filing objections, this is the effect of the statute. But, if matters subsequently occur, which are a valid bar to the demand, or which deprive the creditor of all right in equity and good conscience to share in the distribution of the assets, the statute does not preclude their introduction, and they may be shown at any time before a final decree is rendered declaring the amount of the claim, and the ratable proportion of the assets to which the claimant is entitled.”

In Thames v. Herbert, 61 Ala. 340, we said : “ The statute requires that, if no opposition to .a claim filed is made by the administrator, or by any other creditor, within twelve months after the declaration of insolvency, by filing objections thereto in writing, the claim must be allo'wed. — Code of 1876, §§ 2574-5. The allowance of the claim, in the absence of objection within the prescribed time, is a right of the creditor secured by the statute.” We said, also, in that case: ‘‘The same policy which demands that, within a particular period, the claims should be filed, requires that there should be a period, within which the contestation of their correctness should be made.” In Randle v. Carter, 62 Ala. 95, 104, this court said : “ The ascertainment of the validity and amount of the demand of a creditor, in the course of proceedings in insolvency in the Court of Probate, has all the attributes of a judgment in personam against the personal representative, obtained in the regular course of a suit at common law by a creditor.”

The result of the foregoing clear principles of law is, that although the defendant below, appellant here, had not, after the reversal here, by a decree of the Probate Court, established the validity and amount of his claim against the insolvent estate, and hence can not be said to have reduced his claim to judgment, yet its condition was such that its validity and amount stood proved in the Probate Court, and the administrator had lost all opportunity to defend against it, on the only ground of defense he had. This, by an inexorable mandate of the statute. The claim of appellant, then, stands on as high grounds as a judgment at law, and can be assailed only on the principles which obtain in attempts in equity to get rid of judgments at law.

The claims in controversy in this suit were placed by Ligón, as administrator of Walker, in the hands of Mr. Cooper as attorney, with authority to collect or arrange. The notes were signed by three persons, each of whom had become insolvent, and two of them were adjudicated bankrupts. ■Steele, on whom the duty of paying the notes in the first instance rested, made an arrangement with Mr. Cooper, by which he surrendered the lands, in the purchase of which the notes were given, in full discharge of the notes, and it was agreed that the notes should be surrendered to Steele, but they never were. These constitute the claim in controversy in the present suit. Long after the adjustment between Steele and Mr. Copper, mentioned above, Ligón filed the claim as a charge against Winston’s insolvent estate. We feel authorized to assume he did this personally, first, because Mr. Cooper’s receipt for the notes is made the basis of the filing, and not the notes themselves; and, second, because the bill avers that Ligón filed the claims, and does not connect Mr. Cooper with it in any way. It is not made the duty of an attorney, who has a claim for collection, to file it as a claim against the estate of the debtor, afterwards declared insolvent.—Stubbs v. Beene, 37 Ala. 637.

It is -contended for appellee that the assurances of Mr. Cooper, given to Thornton, .the administrator, relieve him from all imputation of neglect, in failing to file exceptions to the allowance of this claim. Mock v. Steele, 34 Ala. 198, is relied on in support of this position. The cases are entirely dissimilar. That was not the case of a settlement of an insolvent estate between the administrator and the creditors. True, the estate had been declared insolvent, and claims had been filed against it as such. But, when the settlement came to be made, the creditors had been paid in full, and a surplus left for distribution. When the final settlement and distribution took place, the distributees proposed to except to a credit Steele claimed for a debt he had allowed and paid, and upon a representation made by Steele, they allowed the claim to pass without objection. The distributees subsequently filed a bill against Steele, to recover from, him this sum. The bill charged that Steele, “ upon his settlement as administrator, for the purpose of inducing the complainants not to object to the allowance of the credit, represented the correctness of the credit, and stated circumstances out of which it grew, plainly demonstrating its correctness; that the complainants, who were ignorant upon the subject, upon those representations, forbore to object; that the contrary of the representations was true to such an extent, as to destroy the right to the credit, and that the credit was allowed.” On appeal, this court held the bill contained equity. It will be observed that, in the case of Mock v. Steele, the false representation charged was made by Steele himself. In the present case, the representation and assurance on which the complainant alleges he relied, when he abstained from filing ■exceptions to the claim, were made and given by Mr. Cooper, ■Neither Ligón, the administrator, nor Moore* the defendant, is charged to have been present, or to have had anything to do with it. It is not even charged in the bill that Mr. Cooper as attorney, or otherwise, had any agency in filing the claim against the insolvent estate. On the contrary, as we have shown above, this service was performed by Ligón himself. When the compromise and adjustment were concluded between Steele and Mr. Cooper, his services under that retainer were evidently completed, and nothing remained but for him to turn over to his client the fruits of his professional skill. As further demonstration of the correctness of these views, Mr. Cooper is one of the counsel for Thornton in this suit. No one, looking at the facts, would question the propriety of his thus appearing, because he was in no Way connected with the filing of this claim.

The present case, then, is the familiar one of an appeal to the Court of Chancery, to be relieved from the consequences of a failure to make a valid legal defense. To come within the rule, the party complaining must show, not only that he had a valid defense, but that he was prevented from making it by the fraud of the opposite party, or by mistake or accident, unmixed with negligenee on tris part. The party seeking relief must negative all imputation of negligence. 1 Brick. Dig. 643, §§ 60, et seq.; Ib. 666, § 376; Weakly v. Gurley, 60 Ala. 399; Bowden v. Perdue, 59 Ala. 409. the bill in the present case falls very far short of the rule. Gamble v. Jordan, 54 Ala. 432.

We are aware that the rule we invoke works hardly in this case. It is better, however, to maintain a sound rule in its integrity — one which has withstood the scrutiny and assaults of ages — than to destroy or weaken it to relieve a hard case. The present bill is without equity; and this court, proceeding to render the decree the chancellor should have rendered, doth order and decree that the injunction heretofore granted be, and the same is hereby dissolved. In the farther progress of this cause, the chancellor will be governed by the principles declared above.

Reversed and remanded.