Mosely v. Floyd , 31 Ga. 564 ( 1860 )

By the Court. —

Ryon, J.,

delivering the opinion.

This was a bill filed by the complainants, plaintiffs in error, against John J. Floyd and others, for account.

John Floyd, late of the county of Putnam, by his last will, appointed his two sons, Stewart and John J. Floyd, the principal defendants in this case, executors thereof, and by the 4th item directed all the balance of his property, not otherwise specifically disposed of, to be sold; and from the proceeds he gave to his two sons, the said Stewart and John Floyd, the sum of five thousand dollars, in trust, to pay the interest thereon to his widow, Mina Floyd, during her life, and at her death, to be divided equally among his children, or the representatives of deceased’s children, in the manner specifically stated therein. The balance of the proceeds of the sale was to' be divided equally among his children, or representatives of children, of whom there were eight, in all, or rather eight shares or parts into which this residuum was to be divided: Martha Reese, the wife of Thaddeus Reese, and mother of complainants, Ann Eliza and Mary Jane, being one; Mrs. Reese dying before her father, he subsequently, by a codicil to his will, bequeathed to these, her children, the share directed to be given to her by the original will. '

Both of the executors were qualified, but Stewart alone executed the will; the defendant, John J., taking no part whatever in the active administration thereof. The property of the testator was sold by Stewart, as executor, John J. attending the sale and buying much of the property, gave his notes for the same to his brother, and took them up. as other purchasers.

The five thousand dollars, in which the widow had the life interest, went into the hands of Stewart, as one of the trustees named in his father’s will, for that purpose, he executing a receipt to. the executors for the same, as trustee, John J. Floyd not appearing to have accepted that trust.

. Stewart Floyd, during his life, settled with and paid to the complainant, Johnson and wife, for all interest or claim they had.on him in that right under the will, other than their part of that fund in which the widow had a life estate. He also, on the 15th day of November, 1850, had a settlement with Mary Jane, the. other complainant, then of age and unmarried; when the amount due to her under the will, ex-‘ elusive of her interest in.the five thousand dollars set apart for the widow for life, was ascertained to be twelve hundred dollars; and in settlement of this amount, the said Stewart gave to her seven hundred dollars in money, and his note for five hundred dollars, due on the first day of January next thereafter, and she executed to him a receipt, of which the following is a copy:

“Received of the executors of John Floyd, deceased, twelve hundred dollars, under the will of said John Floyd, 15th November, 1850. MARY JANE REESE.”

Stewart Floyd, subsequently to these settlements in October, 1853, departed this life insolvent, having appropriated to his own usé, or wasted, the five thousand dollars in which his mother had the life interest, and without having paid the note given to the complainant, Mary Jane, or any part of it; all of his property having been seized and sold by the sheriff under common law executions against him, in favor of various creditors.

The bill was filed by all the complainants, to charge the defendant, John J. Floyd, as co-executor, with .the payment of the five thousand dollars, or rather with their share, which was the one-eighth part of the sum, after the termination of the life interest. Failing in this, to. have that interest secured and set apart from the proceeds of the sales of the property of said deceased, Stewart Floyd, under the provisions of “An Act for the. better protection and security of orphans and their estates,” approved February 18th, 1789, (Cobb’s Dig. 288), and by the complainants, Mosely and wife, to charge defendant (Floyd) as executor, with the payment of the note given to the said Mary Jane, before her marriage, by Stewart Floyd, in his lifetime, for five hundred dollars, alleging that it was not received by her as a payment, but as a memorandum of the balance due her on that account; (this allegation was denied by defendant, who asserted that it was taken as a payment) ; but failing in charging defendant (Floyd) with its payment, the bill sought to' charge the fund in the sheriff’s hands with its payment, as a debt due by, the deceased, in his character as executor, and therefore a preferred debt in the same way, as the debt of two thousand dollars was a preferred one.

The cause was submitted to the jury on the bill and answer, and no other evidence offered.

On these facts, two questions were made and argued before us:

1st. Whether the defendant, John J. Floyd, was liable, individually, for the waste committed by his co-executor, the deceased, Stewart Floyd?

2d. Whether the note for five hundred dollars, given by Stewart Floyd to complainant, was received as a payment or as a mere memorandum, as evidence of the amount of the debt? If the former, then neither is the defendant, nor the funds in the hands of the sheriff, chargeable with its payment as a preferred debt.

1. It is not pretended that the defendant is liable for .any of the acts or waste of his deceased co-executor, but those to which he actively contributed; that rule is conceded. But it is claimed, that the defendant qualified as executor, and subsequently purchased property of the testator and paid the money for such purchases to his co-executor, that he, in doing so, actively contributed to the waste; that he ought to have retained what he was indebted for purchases, in his own hands, and paid it out only in execution of the trusts of the will, and by not doing so, but in paying it over to his co-executor, he became liable pro tanta in this account.

If we assented to the proposition — which we do not — we could only charge the defendant with the amount paid over by him that was actually diverted from the trust and wasted by the co-executor. And there is nothing in the record to show that any part of the money paid by defendant into the hands of his co-executor was actually wasted or misapplied. .It is not improbable that the money or payments made by defendant to his co-executor were properly applied by him to the payment of debts, legacies or otherwise, in execution of the will. Before the defendant is made chargeable, there ought at least to be a prima facie case made against him. That has -not beei} done. But we can not admit the proposition to be true, that when the heirs, legatees or distributees of an estate permit one executor to bid for and purchase property at a sale by his co-executors, and give his notes therefor as other purchasers, and he subsequently pays over the money due on his notes so given, in discharge of his liability, and that money is wasted, that such executor, so buying and paying for his purchases, is liable for such waste. If it-be conceded, as it was in this instance, that the executor was a competent purchaser — -for those interested in the estate had acquiesced in and ratified his right to do so — rthen such executor, so buying at the sale of his co-executor, and, like all other persons, complying with its terms, must, like other purchasers, pay his notes ■ in order to cancel, discharge and get possession of them. The money he pays over is his own, and not the estate’s, and did not become the property of the estate until it was paid over. His co-executor could have traded the notes; could have enforced their collection in a Court of Law, as his own, treating the sale as an execution of the trust, and not the collection of the money from the purchasers; in fact, the law so regards a sale, as an administration. Then, how could the fact of the defendant’s paying his own money over, in the necessary satisfaction of a debt legally and properly incurred, be regarded as an act contributing to the waste and misapplication of trust funds by his co-executor? We do1 not think it can be so. Now, if funds belonging to the trust had come to- the hands of defendant from any source, and he had paid it over to1 his co-executor for any reáson, and that money should be wasted, the defendant would be liable for the same to any one interested in the estate.

There is still another reason why the defendant is not liable for the five thousand dollars set apart by the 4th item of testator’s will for the use of his widow during life. That money was raised and received by the deceased executor, not as executor, but as trustee under the will; that certainly relieved the defendant from liability for it, as executor, and he can not be charged with it, as trustee, for he never accepted, or acted upon, that trust.

2. For-the reason already given, we do not hold the defendant to be chargeable with the note for five hundred dollars, given by Stewart Floyd to the complainant, Mary Jane. But there is another that does not apply to' the other question, and that is this: Conceding that, at the time the note was given, the defendant was liable to the payee, the giving that note by Stewart Floyd, and the taking of it as a security for the money by the payee, effectually discharged the defendant from any further liability for that debt. “While the mere giving a note does not discharge the original indebtedness, unless it be accepted as payment at the time, it is, nevertheless, equally true, that if the creditor changes the nature or character of the debt, as by taking the note of one of the parties, and giving day of payment, the other is exonerated. He has a right to suppose that he is no longer looked to as a debtor.” Stone vs. Chamberlain & Bancroft, 20 Ga. 262.

3. Then, as to the other only remaining question in the case, was the note given and accepted as payment, or merely as a memorandum of the indebtedness ? If the former, then the complainant’s equitable claim on the fund from the sale of the deceased’s property is gone.

Whether, as a payment, depends entirely upon the intention of the parties to the transaction at the time of its execution. The only data we have to ascertain that intention, are the note, the receipt given at the time, and the acquiescence of the. complainant. From the note, we infer nothing- one way or the other. But the receipt, we think, is a pretty clear indication that the note was given and received as a payment. The ascertained indebtedness was twelve hundred dollars, a part of which was paid in money, and a part in this note; but one receipt was given, and that for the entire sum of twelve hundred dollars, the money and the note being equally treated as money; no distinction was made. The money was surely treated as a payment, and if so, why was not the note? The receipt intended as evidence of the payment, speaks for the note as well as the money.

Besides, the maker of this note lived some two years and a half after its execution, and was, at its date, reputed to^ be in good and solvent circumstances. If it had been taken as a mere memorandum or evidence of the amount of the indebtedness, it is very probable that the same reasons that impelled the accounting would have induced an enforcement of the demand by suit. As no such attempt was made, for so long a time, and while the maker was in life, it is but fair to suppose that it was intended as a payment, and the note held as a satisfactory investment of the money. We do not hold this to be conclusive, by any means, but sufficient as a foundation for the charge complained of; that is, that the jury might look to this fact as a circumstance indicating that the note was intended as a payment.

The judgment of the Court below is in accordance with our view of the rights of the parties.

JUDGMENT.

Whereupon, it is considered and adjudged by the Court, that the judgment of the Court below be affirmed.