Clark v. Clough , 65 N.H. 43 ( 1883 )

The inquiry presented in this case is as to the admissibility of Fellows's deposition. This has been supposed by counsel to depend mainly upon the capacity in which the defendants Clough and Foster are to be considered as parties, namely, whether as executors or trustees. This question has been argued with very much acuteness and research; but in the view we have taken, it is one of no practical consequence.

The statute excluding a party as a witness when the adverse party is an executor or administrator applies to suits in equity as well as at law (Robinson v. Wheeler, 51 N.H. 384, 387), and, its object being to place parties upon an equal footing, it prohibits the living party to a transaction from living his version of it when the other party, being dead, cannot testify. Moore v. Taylor, 44 N.H. 370, 375; Chandler v. Davis,47 N.H. 462, 464, 465; Harvey v. Hilliard, ib. 551, 553; Brown v. Brown,48 N.H. 90; True v. Shepard, 51 N.H. 501, 502; Hoit v. Russell,56 N.H. 559, 563. These decisions demonstrate that a literal construction is not to be put upon the statute, but, on the contrary, that it is to be interpreted with reference to its general scope and object, which was to secure equality in the respect named between the living and the dead. Such being the undoubted purpose of its makers, it will, if possible, be construed and applied accordingly; and, therefore, we have no hesitation in affirming the ruling of the master, excluding so much of the deposition as relates to matters concerning which Herman Foster, if alive, could have testified. For, as argued by counsel for the defendants, the statute manifestly was not intended for the personal benefit of the executor? but for the protection of the property of the estate; and it can, therefore, make no conceivable practical or equitable difference whether Clough and Foster hold the property in controversy as executors of Herman, or as trustees under his will, inasmuch as it is obviously entitled to the same protection in the one case as in the other.

Nor do we think it makes any substantial legal difference; for, as executors, they held the property simply as trustees for the creditors of the testator and the beneficiaries named in his will; and if they have ceased to be executors, they have not ceased to be trustees, but still hold the property in trust for the same creditors and beneficiaries, and with no estate or beneficial interest in the property itself beyond what is adequate for the performance of the trust. The change, if any, is technical and nominal rather than actual and substantial, and affords no sufficient reason why the statute protection should be withdrawn. Indeed, it is impossible, outside of the literal words of the statute, to give any reason why protection should be extended in the one case and not in the other; and it will not, therefore, be done unless the statute imperatively requires it. We are of the opinion that it does not; and in arriving at this result we are not compelled to base our conclusion upon the general rule that an assignee takes all the rights of his assignor, or to hold that the phrase "executors or administrators," as used in the statute, is broad enough to include heirs and beneficiaries; but we put it upon the ground that the terms of the statute, taken in connection with its undoubted intent, are broad enough to embrace "all persons holding the estate of a deceased person in an official representative capacity." Further than this we do not go, nor is it necessary for the purpose of the case.

The protection of the estates of deceased persons having been the controlling consideration which must have actuated the legislature, it may well be held that executors and administrators are specifically named in the statute merely by way of illustration and example, and as expressing the names commonly used in referring to the representatives of deceased persons (Bish. Wr. L., ss. 190, 191); and we construe it accordingly. This construction appears to us to be the only one consonant with reason and discretion, and clearly does not extend beyond the mischief contemplated by the makers of the statute, or beyond the limits of its language, unless it be taken literally. It is not, therefore, as contended for the plaintiff, legislative, but administrative; it is not altering the law, but expounding it; it is not declaring what, in our judgment, the legislature ought to have intended, but what they manifestly did intend. And it is obvious, moreover, that a contrary construction would frequently not only give to the statute an unjust operation; but would also defeat its object, and lead to the most absurd consequences; and where these results would follow from a literal interpretation, the familiar principle that the intent, and not the literal meaning, must be regarded, is applicable.

The deposition being within the prohibition of the statute, and nothing appearing to justify its admission on the ground of injustice, the plaintiff has no ground of complaint upon this branch of the case.

The second inquiry is in respect to the foreclosure of the city mortgage, so called.

The master finds that it was legally foreclosed so far as the determination of this question depends upon any finding of the facts, and we see no ground to question the correctness of his finding. But it is objected that, as matter of law, the proceedings conferring possession were invalid, and, therefore, nugatory for any purpose of foreclosure. Suppose this to be so, it cannot avail the plaintiff. The objection comes too late. The foreclosure was in 1854; no defect or illegality appears upon the face of the proceedings; and advantage of an irregular foreclosure must be taken within a a reasonable time. 2 Jones Mort., 2d ed., s. 1,054. This long since elapsed. But if it were otherwise, the objection is none the less unavailing. There was an entry under process of law which became part of the public records, and which gave Foster at least color of title; and as it was followed on his part down to his decease. more than twenty years afterwards, by peaceable, continuous, visible, and exclusive possession and occupation of the mortgaged premises under claim of title, it is immaterial whether the foreclosure was valid or otherwise, because in either event the title became perfected in Foster before his decease, by lapse of time. Grant v. Fowler, 39 N.H. 101, 104, and cases cited; Forest v. Jackson, 56 N.H. 357, 362. And, in any view, the right of redemption, and to an accounting of the rents and profits, was long since barred; for, having permitted Foster to hold possession of the premises for twenty years without accounting, and without admitting that he possessed a mortgage title only, Fellows lost his right of redemption and to an accounting. The relation of mortgagor and mortgagee ceased to exist, and Foster's title became absolute in equity as well as in law. 2 Sto. Eq. Jur., 12th ed., s. 1,028 a and b. "Twenty years unexplained possession by the mortgagor bars the right of the mortgagee to the land, upon the presumption that the mortgage debt has been discharged. So, twenty years unexplained possession by the mortgagee bars the right to redeem, upon the presumption that the right has been released, and in some way lost." Perley, C. J., in Green v. Cross, 45 N.H. 584.

It is true, nevertheless, that this presumption may in either case be rebutted by circumstances, and the relation of attorney and client between Foster and Fellows is relied upon by the plaintiff for this purpose. But the finding of the master is, that so far as the question is one of fact, Foster's title is not affected by the fact that he was employed as counsel by Fellows; and we do not find anything in the report, which, as matter of law, defeats the effect of Foster's possession, as a bar to the right of redemption. On the contrary, the express finding of the master is, that "there was no evidence that pointed to any fraud or deception used by said Foster." In view of these findings, it must be held that Foster's relation as attorney (which apparently ceased many years before his death) did not invalidate his title under the city mortgage, so called, or any of the other mortgages which were assigned to him.

But beyond all this, we think that the releases under seal from Fellows to Foster, which, with one exception, were executed after the relation of attorney and client had terminated, must be held to operate as a bar to the maintenance of the plaintiff's bill. A release under seal is conclusive between the parties, in the absence of fraud in obtaining it (Sherburne v. Goodwin, 44 N.H. 271; Ellsworth v. Fogg, 36 Vt. 355; Perkins v. Fourniquet, 14 How. 327); and, if given to one in possession of lands, whether by right or wrong, by one having a right to the same, it will operate to pass such right. Everenden v. Beaumont, 7 Mass. 76; Poor v. Robinson, 10 Mass. 131,134. The master finds not only that there was no fraud in obtaining the releases, but that Fellows, a man of acknowledged capacity, executed them understandingly. Taking this to be so, the necessary effect is to uphold the releases; and to uphold the releases is not only to establish a perfect defence to the plaintiff's bill, but also to render immaterial all, or substantially all, of his requests for additional findings.

And if the releases are not upheld the plaintiff stands no better, inasmuch as the facts undeniably show gross laches and neglect on the part of Fellows, even if his version of the transactions between Foster and himself, as set forth in the bill, be accepted as true; and where there have been such laches in prosecuting rights, or long and unreasonable acquiescence in the assertion of adverse rights, no doctrine is better established than that a court of equity will refuse to interfere. Hathaway v. Noble, 55 N.H. 508; 2 Sto. Eq. Jur., s. 1,520. It is true that cases of trust constitute an exception; but this is so only so long as the relation continues. "Where this relation is no longer admitted to exist, or time and long acquiescence have obscured the nature and character of the trust, or the acts of the parties, or other circumstances, give rise to presumptions unfavorable to its continuance, — in all such cases a court of equity will refuse relief upon the ground of lapse of time, and its inability to do complete justice." 2 Sto. Eq. Jur., s. 1,520 a; 2 Per. Tr., ss. 869, 870. In short, many insuperable difficulties attend the plaintiffs case.

After a large part of the evidence had been introduced at the hearing, the plaintiff asked to amend his bill, and claim relief upon the ground of the insolvency of the estate, and, consequently, that the conveyances were fraudulent as to creditors. The master declined to consider the propriety of the proposed amendment, and refers the question of its admissibility to the court.

The defendants object on two grounds, — first, because it introduces an entirely distinct cause of action; second, because Fellows, if alive, could not be permitted to set up his own fraud to avoid Foster's title, and so the administrator of Fellows is estopped from taking a position which Fellows himself was estopped from taking. But this conclusion does not follow; for, although the general doctrine is that a fraudulent transfer is good as against the grantor, his heirs, executors, administrators, agents, and parties claiming under him (Bump Fr. Conv., 2d ed., 437, 438, and cases cited), yet there is in this state a well recognized exception in the case of insolvent estates, and it is here held that the administrator of such an estate is not bound by the fraudulent conveyance of his intestate. Kingsbury v. Wild, 3 N.H. 30; Abbott v. Tenney, 18 N.H. 109; Leavitt v. Leavitt, 47 N.H. 329. These decisions go upon the ground, as stated by Parker, C. J., in Abbott v. Tenney, that "an administrator of an insolvent estate is emphatically the representative of the creditors," or, as stated by Bellows, J., in Leavitt v. Leavitt, Supra, that he represents both the heirs and the creditors, and so, while as representative of the former he cannot impeach the conveyance, yet as representative of the latter, and in their behalf, he may impeach it. The plaintiff, therefore, is not estopped to deny the validity of his insolvent intestate's conveyances, for the reason assigned by the defendants; and, under the liberal rule as to amendments which now prevails in this jurisdiction, the asked for amendment is allowed. Nevertheless, we hold that its allowance is utterly useless as affecting the title to the property obtained though the foreclosure, not only because the creditors have become estopped to impeach the conveyances by the lapse of time (Hathaway v. Noble, supra), but because it is distinctly found by the master that Foster's title so obtained was not fraudulent as to creditors.

In regard to the homestead at Goff's Falls, it appears that on February 14, 1866, Foster obtained judgment as of mortgage for the possession of the premises, but that possession was never taken under the judgment, and that a suit of scire facias has been sued out thereon, since Foster's death, by his executors, which is now pending in the trial term. If any questions as to this property are before us, they have not been argued by the counsel, and we express no opinion upon this branch of the case.

The defendants' motion at the trial term for a judgment establishing the foreclosures reported by the master should be granted, and a decree, in substance as follows, entered up:

Upon the report of the master being submitted to the court, and after hearing the arguments of the counsel thereon, it is adjudged and decreed, that the mortgage from Moses Fellows to the city of Manchester, and assigned by the city to Hunt, and by him to Tompkins, and by the latter to Herman Foster; and the mortgage from Fellows to Montgomery, and by Montgomery assigned to Hale, and by Hale to Herman Foster, were foreclosed as alleged by the defendants in their answer; that the plaintiff's bill be dismissed, but as to the Goff's Falls property, the dismissal is without prejudice.

STANLEY, SMITH, and CLARK, JJ., did not sit: the others concurred.