Wright v. Lang , 66 Ala. 389 ( 1880 )

SOMERYILLE, L

In Guild v. Thomas, 54 Ala. 414, it was held to be a good defense to an action on an injunction bond, that the defendant, who was a surety, intrusted the bond to the principal obligor as an escrow, with authority to deliver it only on the express condition, that other persons named should first join as sureties in its execution. It was delivered contrary to this condition, and the surety was held not liable, on a plea of non est factum being filed by him setting up these facts. This principle, however, does not apply, where the sureties suffer the principal obligor to act under such bond, after acquiring knowledge, or being charged with notice, of the fact that it has been delivered.

The evidence in this case clearly proves the fact that the bond of Lang was delivered to him only as.an escrow. Appellants signed it, with the understanding that it was to be signed by other named sureties, before being delivered to the probate judge, and that after the other required signatures were obtained, it should be returned to Stansel, one of the sureties, for his inspection before delivery. It was filed December 29, 1869, in violation of these conditions, and without being so inspected by said surety. In October, 1871, nearly two years after this, Wright, one of the sureties, made application to the Probate Courfct for the removal of Lang -from his position as executor, in the event of his failure to give an additional bond, under the provisions of section 2380 of the Code of 1876. The ground of the application was, the alleged insolvency of Lang, and the apprehension of loss by his continuance in his executorial office. No mention was made in this petition, of the bond having been executed on any condition, or having been delivered without the authority of Wright or the other sureties. The fact that this application was filed was known to Stansel, but not until it had been withdrawn, and proceedings under it abandoned at the solicitation of Lang. He was cognizant of the fact, however, that the executor was acting as such, having aided in making out his inventory, and he knew that the bond had not been returned to him for his inspection. This was sufficient, we think, to put Stansel on inquiry as to its probable delivery. The other surety, Lewis T. Lang, admits, in his deposition, that he knew that John T. Lang had taken charge of the estate, and was proceeding to discharge the duties of his office.

We think these facts constitute a waiver of the conditions in question, and operate as an estoppel upon the sureties, in view of their subsequent silence until November 23, 1877, when they filed a petition asking to be made parties to this bill, for the purpose of raising this issue. They suffered the executor to act without objection. They had the means of ascertaining whether the bond was properly executed, and it was their fault if they failed to do so. — Brandt on Surety-ship, § 363; Robertson v. Coke, 11 Ala. 466; May v. Robertson, 13 Ala. 86. In cases of this character, the possession of the bond by the probate judge, and his approval of it, raise the presumption that it was properly delivered to him as the obligee. The onus of rebutting this presumption rests on the party denying the validity of the instrument. We cannot see that the chancellor erred, under this state of facts, in holding that the sureties were bound.—Firemen's Ins. Co. v. McMillan, 29 Ala. 147; Spence v. Rutledge, 11 Ala. 590.

It is insisted that the chancellor erred in charging the executor, upon his final settlement, with the notes of William H. Lang. These notes were payable to the testator, and the executor refused to place them upon his inventory, though they were found among the papers of the said deceased; and his excuse for such refusal was, that they were paid, for and on his account, and were intended to be cancelled. This averment the evidence fails to sustain, but the notes are shown to be worthless by reason qf the maker’s insolvency.

It is a correct rule, of law, that the sureties of an executor or administrator are generally liable only for such assets as may have come to the principal’s possession, or which he could have collected by the exercise of due diligence. Thompson v. Searcy, 6 Port. 393; Miller v. Gee, 4 Ala. 359. But a different rule obtains, where the debt is due by the personal representative, in his individual capacity, to the estate’ or testator. Here, the right to demand, and the obligation to pay, both co-exist in the same person, and the law presumes instantaneous payment and extinguishment of the debt. The sureties are thus held conclusively liable, though by operation of a mere legal fiction.—Seawell v. Buckley, 54 Ala. 592.

The statute of limitations did not commence to run in favor of the sureties, as against this devastavit of the executor, until the judicial ascertainment of the principal’s liability. This liability is fixed, within the meaning of the statute, not at the date of the actual act of negligence or maladministration, but when it is judicially declared to exist by the judgment of a court of competent jurisdiction.—Fretwell v. McLemore, 52 Ala. 124; Rivers v. Flinn, 47 Ala. 481; Adams v. Jones, at the present term; Code (1876), § 3226, subd. 7.

We find one error in the record, however, which necessarily works a reversal of the chancellor’s decree. Upon .the suggestion of Robert Lang’s death, the settlement should not have progressed to completion, without allowing an opportunity for his personal representative to be made a party defendant. The surviving executor could well proceed with the suit, as the sole remaining party complainant; for executorships, in such cases, being coupled with an interest, survive. — 2 Perry on ¡Trusts, § 414. It is true that there are cases, where a court of equity will dispense with administration, and decree distribution direct. But this is ODly where it appears from the averments of the bill that the administration would be a useless ceremony, and the sole purpose to be accomplished by it is mere distribution. In .such cases, it must be made to appear affirmatively that there are no creditors to be prejudiced, or that a sufficient time has elapsed since the death of the debtor to presumptively bar all existing claims against his estate.—Miller v. Eatman, 11 Ala. 614; Plunkett v. Kelly, 22 Ala. 655; Frowner v. Johnson, 20 Ala. 477. We cannot know that the machinery of a court of equity has not been here instrumentally used to distribute property, which ought to have been charged with the debts of Robert Lang. He was a residuary legatee under his father’s will. His representative had a right to be made a party to the proceeding, with the view of protecting this interest, however remote or contingent its realization. We cannot know that he Would get nothing, for this was one of the very issues to be tried in the cause.

The decree of the chancellor is reversed, and the cause is hereby remanded.