Harper v. Taylor , 193 F. 944 ( 1911 )

TRIEBER, District Judge

(after stating the facts as above). [1] In the leading, case of Hylton v. Hylton, 2 Ves. 547, Lord Hardwick said:

“Where a man acts as guardian, or trustee in the nature of a guardian, for an infant, the court is extremely watchful to prevent that person from taking any advantage immediately upon his ward coming of age and at the time of ■settling accounts or delivering up the trust, because undue advantage may be taken.”

The same rule has been recognized and followed by the American courts. Adams v. Cowen, 177 U. S. 471, 20 Sup. Ct. 668, 44 L. Ed. 851, and authorities there cited; Eddy v. Eddy, 168 Fed. 590, 597, 93 C. C. A. 586; 2 Perry on Trusts, § 851; Van Rees v. Witzenburg, 112 Iowa, 30, 83 N. W. 787.

In view of the fact that, at the time this settlement was made and the consent decree entered, the complainant was not quite 20 years old, although she was then a mature woman, the burden of proof to show that no unfair influence was exercised by defendant, and that she was at the time fully advised of all her rights, was upon him. Has the defendant sustained this burden? The findings of fact made by the learned trial judge show that no'unfair means were used or false representations made by defendant and that she had full and complete knowledge of all the facts and had the advice and counsel of her husband and attorney.

[2] While the findings of fact of a chancellor are not conclusive upon an appeal in equity, they are presumptively correct and persuasive, and unless an obvious error has occurred in the application of the law, or a serious mistake has been made in the consideration of the evidence;, such findings will not be disturbed. This is the settled doctrine of this court. Thallman v. Thomas, 111 Fed. 277, 49 C. C. A. 317; Harrison v. Fite, 148 Fed. 781, 78 C. C. A. 447; Babcock v. De Mott, 160 Fed. 882, 88 C. C. A. 64. And this rule is especially applicable when the evidence was taken oraliy in the court and the chancellor had an opportunity to see the witnesses, observe their demeanor while testifying, judge of their candor and intelligence, and thus was able to determine more accurately their credibility and the weight to be given their testimony than an appellate court which must determine the facts from a printed record.

[3] A careful examination of the evidence can lead to no other conclusion than that reached by the learned trial judge. The fairness of the settlement between the parties has been established beyond question. The complainant, although not quite 20 years of age at that time, is shown to have been a bright young woman with considerable business experience, and had at that time, and for some time prior thereto, the assistance and advice of able counsel, and also that .of her husband, who is an attorney. It seems that she had quite a number of lawyers engaged prior to and up to the time of this settlement. Among her attorneys it appears were Messrs. 1!. Scott Howell & Son of Keokuk, Iowa, T. G. Fee of Centerville, Iowa, Mil■crist & Scott of Sioux City, Iowa, and J. C. Mabry of Albia, Iowa. In this connection it is proper to state that Mr. C. F. Howell who is counsel for defendant in this proceeding has no connection whatever with Messrs. H. Scott Howell & Son, and is not related to them.

From 'the evidence it appears conclusively that the proposition for settlement came from the complainant; that propositions and counter propositions were made until finally complainant’s counsel, by her direction, proposed to the defendant to accept $1,500 as a settlement in full; that defendant refused to pay that sum, when complainant requested a personal interview with the defendant and persuaded him to consent to paying that sum; that during all these negotiations complainant was present, advising with her counsel, and when the settlement had been approved by the court and the decree entered, expressed herself as well pleased with the result. Mr. Mabry, who was the complainant’s attorney who concluded the settlement, and whose integrity is beyond question, stated in his testimony:

“The negotiations were carried on not only between himself and the firm of Howell & Klgin, but Mrs. Harper took quite an active part in that herself. ¡She was always present, or practically always, when negotiations were going on. I can’t recall now that I had negotiations aside from her or out of her presence. I had gone over the items of the exceptions in detail with Mrs. Harper, not only once but often, and discussed the chances fully as to a recovery on each item. Mrs. Harper was quite accurate and rapid in figuring tip and appeared very intelligent in the matter of going through the reports. Í found her of a great deal of assistance in ascertaining the true conditions as involved in the report extending over a number of years, and would spend hours at a time going over this report in detail and discussing in detail what evidence we had or would be required on each item and the chances for and against on each item. Mrs. Harper was exceedingly anxious to get through with it. There was another feature in ihe case that gave me considerable difficulty, and one on which 1 entertained considerable doubt, and I explained that to Mrs. Harper, and that was a question that had been raised in connection with the matter in behalf of Mrs. Harper’s mother as to the bequest under her grandfather’s will to her brother who had died without other issue than Ms mother, and the question raised was whether or not it was an absolute bequest in the concluding paragraph of the will. I examined the authorities carefully and called Mrs. Harper’s attention to them. I did not expect her to look at them from the standpoint of a lawyer, but simply lo show that there was a somewhat serious question in the case as I viewed the language1 of the will. If that were correct, then a great deal of this money in dispute would have gone to her mother as the only heir of her deceased son who died without issue.”

Other witnesses testified to the same effect.

In addition to the testimony of these witnesses, it also appeared in evidence that in 1907, a year after this settlement had been made, the complainant, at her home in Boston, Mass., had an answer prepared to be filed in another proceeding pending in the courts of Iowa where-, in she was sued by one of her attorneys for his fee. This answer was prepared by an attorney in Boston who obtained the facts solely from the complainant. In this answer she set up as a defense that the said attorneys, H. Scott Howell & Son, had not properly protected her interests in the proceedings concerning the settlement of her guardian, and for that reason she had to employ other attorneys; that-after employing such other attorneys she found that there were many other objections to the final report of her guardian than those filed by tí. Scott Howell & Son, and by reason of filing these additional objections she obtained $1,500 from her guardian.

Another important fact to be considered in connection with the other evidence is that, although the bill charges that she did not discover the fraud which had been practiced upon her by the defendant or his attorneys until some time during the year 1907 or 19t)8, there was not a scintilla of evidence to sustain this allegation. Nor was there any evidence which cast the least reflection upon the integrity of any of the counsel employed by complainant in her controversy relating to the settlement or the attorneys of the defendant.

The evidence showing that the settlement between complainant and defendant was fair, that no fraud or deceit had been practiced upon her bj' the defendant or his attorneys, and that she had full knowledge of all the facts and expressed her satisfaction therewith after the decree had been entered, is practically conclusive.

In view of the conclusions reached, it is unnecessary for the court to determine whether she was guilty of laches, or whether her action is barred by the statute of limitations of the state of Iowa, as claimed by counsel for defendant.

The decree of the Circuit Court was right and is therefore affirmed.