Hotchkiss v. Beach , 10 Conn. 232 ( 1834 )

ChuRch, J.

The regulations for the settlement of insolvent estates, in this state, are statutory. We can look no where but to our statutes for the powers and duties of courts of probate ; although these courts, like all others, possess such incidental powers as are necessary to an entire performance of their duties.

Judges of probate have no jurisdiction concurrent with commissioners upon insolvent estates. Upon an examination of our statutes, I think it will not be discovered, that any power is given to judges of probate to allow or disallow, either directly or indirectly, any claim or demand against an insolvent estate: such power is conferred upon the commissioners alone. The judge, after having appointed commissioners, may direct the time within which creditors shall exhibit their demands to them for examination and allowance ; and when he has done this, he acts no more on this subject until the commissioners have made to him their report of claims allowed. After such report is made, if no proceedings are had to review it, before a board constituted by law for that purpose, and after the administration account is settled, by the judge, his duty is “ to direct payment of the debts and demands against the estate to be made in the following manner : the funeral expenses and incident charges of settling and selling the estate ; debts due for last sickness of the deceased ; taxes and debts due to the state ; and the debts of the several creditors, as allowed by the commissioners, in proportion to the sum found due.” It is obvious, that the act of the commissioners in the allowance of claims, is to be the sole rule, by which the judge is to order payment.

I think commissioners possess, not only by the express provisions of the statute, but by necessary implication, the power - of determining, as well the nature and character of the demands against the estate, as their validity and amount; and indeed, I see not but the one is inseparable from the other. In the examination of claims, they must, necessarily, determine who is debtor and who is creditor ; whether the debt allowed was due from one or more persons, or is due to one or more ; and thus decide whether the demand be due from or to a co-partnership. In the same manner, the commissioners, in examining a claim, and hearing the proof in its support, must know, whether it is for the last sickness of the deceased, or is of a different character. But if there be any case, where an ordinary investigation by commissioners will not impart to them a knowledge of the character of the claim investigated, then examination may, and always should, be directed to this subject, either by the claimant, or by the administrator, whose interest or whose duty it may be to do so ; and then, if the commissioners err, and any person shall be aggrieved, a remedy is provided, as in other cases, by a review before the proper tribunal, which is the only mode whereby the report of commissioners can be either rejected or corrected. This system is complete, and leaves neither conflicting nor uncertain powers.

The power claimed for the judge of probate, in this case, is unnecessary, and therefore, improper; because the commissioners, in the necessary performance of their duties, must, as has been shewn, exercise the same powers. It is a power, also, which, without further legislation on this subject, ought not to be confided to judges of probate; because, as was done in the present case, it would authorize the investigation of facts and the decision of important questions, without any notice to interested parties to appear and be heard.

It is said, in support of this power of the judge, that it is incidental to his general authority to marshall the assets of the deceased. This may be granted ; but he must do so upon the facts furnished by the report of the commissioners, and order the payment of debts, as allowed by them.

I am of opinion, for these reasons, that the judgment of the superior court should be reversed, and the decree of the court of probate disaffirmed.

Daggett, Ch. J. and Bissell, J. were of the same opin- ’ r

Williams, J.

The appellants, now plaintiffs in error, claim, that the court of probate could not legally deprive them of an equal dividend with the other creditors. It has not been denied, on this trial, that the court of probate has done any thing but what a court of chancery, upon principles there settled, might have done. These principles were recognized, by this court, at the last term, in the case of Witter v. Richards, 10 Conn. Rep. 37. But it is claimed, that after the report of commissioners, in which the appellants’ debt is allowed, the court of probate could only go on and order equal payments to the creditors, unless the doings of commissioners were reviewed under our statute. By our law, the settlement of estates is vested in the courts of probate ; to effect which those courts are invested with the powers of the ecclesiastical courts in Great-Britain, and most of the powers of the courts of chancery relative to that subject. It is the duty of the court, in making the settlement, to inquire what is the amount of debts, and what are the funds to meet them, and how they should be applied.

But when an estate is represented insolvent, the statute has prescribed a particular mode of ascertaining the amount of debts. Commissioners are, by the court of probate, to be appointed, “ with power to receive, examine and allow the claims of the several creditors which shall be proved, by legal evidence, to be justly due“ and to make their report containing a list of all the claims by them allowed.” Stat. 210. tit. 32. s. 40. By this board, under this authority, the claim of the appellants has been ascertained ; and it has been legally found, that the estate is indebted to the Hotchkisses in a certain amount. That finding not having been reviewed, in the only manner pointed out by law, is established, and cannot be incidentally attacked. And if, as is claimed, the order of the court of probate contravenes the report of the commissioners, it cannot be established.

The commissioners have found a debt due to the appellants from this estate, The court of probate does not deny that fact; nor is the decree inconsistent with it. But the court of probate has found an additional fact; that although this debt is due from this estate, it was a partnership debt; that is, that it was due from the deceased, by reason of a particular relation • which he sustained. As both facts may be true, and yet the debt may be a debt against the estate, I see no inconsistency in the decree of the court and the report of the commissioners. The court of probate, therefore, does not overrule or disannul the report of the commissioners. That court admits its validity as a debt. It only says, that this debt is to be treated as debts of that character are treated in chancery. It must be satisfied in a particular way, or from a particular quarter.

It is said, however, that the character of the debt, as well as its existence, must be ascertained, by the commissioners; that they act as an equitable as well as legal board ; that, as such, they must make set-offs, &c. That is true : because they are to allow claims justly due, and to ascertain what upon the whole is justly due, they must inquire what is due to the estate from an individual, who claims to be a creditor, before they can tell what upon the whole is due to that individual from the estate. It does not follow from this, that the commissioners are to ascertain or report the origin or character of the debts. Their powers are simple, limited, and well defined. They are to examine and allow claims, proved, by legal evidence, to be justly due; and make a list of all claims by them allowed. Under what part of this commission they are empowered to decide upon and finally adjudicate as to the origin or character of the debt, I have not been able to discover.

In investigating the claim, it is to be supposed, that its origin and character may often, perhaps generally, come before them. Still the question recurs, is it necessary for them to find and report that, in order to discharge the duty imposed upon them? If it is, then perhaps the power may fairly be implied. If it is not, then it is difficult to discover from whence such power is derived. Their commission is merely to ascertain the amount of the debt, not its nature ; and they might as well be called upon to report whether the debt was secured by bond or mortgage, as to say whether it was a partnership debt or not. It is the debt, not the security for the debt, which they are to report; much less, the nature or origin of the debt.

Had, then, these commissioners have done what no law directs them to do, reported that this was or was not a partnership debt, it seems to me, that fact would have been of no import-anee ; because, if even a court of chancery finds a fact not necessary to the result which it has aimed at, in its decree, it will not be considered as material, in another case between these parties. Coit v. Tracy & al. 8 Conn. Rep. 268. 276. Fairman v. Bacon, 8 Conn. Rep. 419. 425.

If that be so, and if a finding, by the commissioners, that it was a partnership debt, would have no effect, because it was not necessary for the legal result, then surely, the omission to find any thing upon that subject, can be of no importance whatever, unless their obligation to find that fact was first proved.

It is insisted, that the report ought to have been appealed from. If it was the duty of the commissioners to find whether it was a partnership debtor not, a finding that it was not, must doubtless be appealed from. That, however, is taking for granted the point in dispute. What here was there to appeal from ? Not that they found the Hotchkisses creditors ; for it was admitted they are creditors. Not that they have so reported ; for they could report no otherwise. But that they had not reported that they were partnership creditors.

The statute allowing an appeal permits it only to persons aggrieved by the doings of the commissioners “ in allowing or rejecting a claim or demand.” Now, no creditor could complain, that this claim was allowed ; for it ought to be allowed ; but his complaint must be, that it was not allowed as a partnership debt. My only answer to this, is, that no appeal is given on such an account.

It is said to be more convenient that facts of this kind should be ascertained by commissioners. If it were so, this does not give them the power, nor authorize this court to give them the power. And when we consider the summary mode, in which' questions of this kind may be settled, by this special tribunal, out of the ordinary course of proceeding, it is not consistent with my inclination, nor my views of duty, to enlarge their jurisdiction.

There can be no objection to the court’s deriving all the aid it can from the investigations before the commissioners, as a court of chancery would from a master in chancery. But the reports should no more be conclusive, in one case than in the other, except made so by statute. And until I find a statute making it the duty of that board to ascertain the nature and rank of debts, as well as the amount, I cannot believe that commissioners have any such power as is claimed.

If this power is not vested in the commissioners, it has not been seriously doubted but that it rested with the court of probate.

If there be no power to marshal the assets and appropriate them to the debts according to their nature or rank, it is apparent that gross injustice must be done.

There can be no doubt that it must exist in the courts of probate or of chancery, when we find, that the great object of our statutes, is, that estates shall be closed or settled ; that as it regards insolvent estates, all suits are stopped in the common law-courts, while this settlement is pending ; and when it has not been claimed, upon this trial, that this power does not exist somewhere, nor that relief can only be obtained in a court of chancery, I shall suppose, that it requires no argument to show, that the court of probate had the power it assumed, unless prevented by the previous proceedings of the commissioners. As in my view, those proceedings have no such effect, I am of opinion, that the court of probate came to a correct result; and that there is no error in the decree of the superior court.

Peters, J., was absent.

Judgment reversed.