Wheeler v. Floyd , 24 S.C. 413 ( 1886 )

The opinion of the court was delivered by

MR. Chief Justioe SimpsoN.

One Hugh Nichols, late of York County, the husband of the defendant, Mrs. Emma F. Faulkner (now Curry), and the father of Hugh Nichols, departed this life intestate in 1866. At the time of his death, he was indebted to the plaintiff in the several notes mentioned in the complaint. The defendant Floyd administered on bis estate, and the tract of land sought to be sold descended to his widow and son above named, who have been in possession ever since, a period of sixteen years before the action below was commenced. It is alleged in the complaint, that the personal estate in the hands of the administrator was insignificant and did not amount to the excess of plaintiff’s sealed demands over one thousand dollars. Wherefore plaintiff demanded judgment, that the real estate in possession of the heirs at law, defendants,, be sold; that creditors be called in; that the administrator be required to account, &c., and in the event that the land may not be sold, that plaintiff have judgment against the heirs at law for the sum of $1,000, and costs, the value of said land, &c.

The defendants answered separately. The administrator plead full administration of the estate, a release from further accounting by the creditors, including the plaintiff, in April, 1869, and the statute of limitations as a bar to any further accounting. The other defendants plead title to the land by their long possession, and denied title in the deceased; also, that the demand of plaintiff was stale, and that they were in no way liable therefor by reason of assets descended; also, as to Hugh Nichols, that he was under age; and finally, that the plaintiff had released the administrator from liability in 1869, notwithstanding he had personal assets sufficient to pay the debts, which, they contended, estoppedthe plaintiff from subjecting the real estate to his claims, specially pleading the lapse of six years since said release as a bar to this action against them as heirs at law.

The case was heard first by his honor, Judge Fraser, upon the pleadings and evidence taken before him, upon which evidence he held that title to the land was in the intestate at his death, and that the defendants, his heirs at law, could not dispute that title, especially as the widow had claimed a homestead in the land after the death of her husband as against his debts; and he adjudged the land liable for the debts of the deceased. But before ordering sale, he thought the administrator should account for the personal assets, with leave to the defendants to set up the release mentioned, and the statute of limitations, &c.; and to this end he ordered the case to a special referee, who reported the amount due the plaintiff, upon such of his notes as were not presumed paid by the lapse of twenty years, also the amount of personal assets in the hands of the administrator, &c.

This report was heard by his honor, Judge Wallace, who, construing the paper mentioned and set up as a release to be more in the nature of an assignment by the creditors of their pro rata share in said assets to the administrator, and not a discharge of the estate or a satisfaction of their claims, adjudged that it could not avail the defendants, except so far as the claims of the creditors should be credited with their respective ¡oro rata shares in said assets, the administrator, however, being entitled to hold said pro rata shares to himself under said assignment; also finding that the personal assets, when thus applied as a credit upon the claims of creditors, were manifestly insufficient to pay said claims. And inasmuch as Judge Eraser had decreed title to the land to have been in the intestate at his death, and liable for the debts of the ancestor in the hands of the heirs, he further adjudged and ordered the same to be sold, the proceeds to be applied to the payment of the claims established, exonerating the administrator from any liability, the funds in his hands being his own under the assignment.

The main question involved in the appeal of defendants is the doctrine of liability of heirs for the debt of the ancestor on account of lands descended or devised. Under the English statute of George II., that doctrine, as established in this State, succinctly stated, seems to be as follows: While it is true that the heir is generally liable for the debts of the ancestor, sealed or unsealed, to the extent of lands descended or devised, yet the land so descended or devised cannot be sold under a judgment obtained against the administrator or executor, obtained in an action to which the heir is not a party, if at the time of such judgment the heir is in the exclusive possession of the land asserting the right of possession and enjoying its rents and profits. In such case, the heir can only be made liable by direct action against him or them, in which, if judgment is obtained, the land can be levied upon, provided it has not' been transferred before action brought. See the case of Bird v. Houze, Speer Eq., 252, and the cases there cited; and Jones v. Wightman, 2 Hill, 579. It is further the law, that the heir cannot acquire title to the land descended as against the debts of the ancestor, by a claim of adverse possession, as against the title descended; though it may be, that where the heir claims in his own right, and his possession may be considered adverse, that such possession, if thus continued for ten years, would divest the lien of a judgment obtained against the ancestor in his life-time. Drayton v. Marshall, Rice Ch., 374; McRae v. Smith, 2 Bay, 339; Cholett v. Hart, 2 Bay, 156.

Now, in the case before the court, the title to the land in question was adjudged below to have descended to the defendants, widow and son of the deceased, as heirs at law, and we think the evidence sustains that finding. We must regard that question, therefore, as settled. The important question left then for our consideration is, has the plaintiff established a claim against these heirs on account of a debt of thé ancestor ? Several of the notes set up by the plaintiff, being past due for over twenty years, were properly excluded under the presumption of payment arising from the lapse of time. Several of the other notes, however, have been established, as the presumption could not be applied to them, twenty years not having intervened since they became due.

But the defendants have relied upon the paper from the creditors to the administrator, given in 1869, which they contend was a release of the estate, and, therefore, a release to them also. And that six years having intervened since its execution, that the statute of limitations is a bar. This, we think, would be a good and perfect defence, if the paper in question was a release. But his honor, Judge Wallace, has construed it to be no release. He has held it, in effect, to be an assignment of the creditors’ pro rata share in the personal assets to the administrator himself, and it operated as a credit upon the claims of the assigning creditors to the extent of their said pro rata share, leaving the balance unpaid, and still a debt against the ancestor. Was this a proper construction? The paper will be found in the “Case,” and we think there is no doubt that the construction of his honor is correct. In fact, the terms of the instrument are so pointed and plain, that we cannot see how any other interpretation than that given by his honor could be suggested. We understand the decree of Judge Wallace to be, that the debt of the plaintiff, as established, must first be credited with the plaintiff’s pro rata share of the assets in the hands of the administrator, and that the heirs are liable only for the balance of the debt, and that the duty of the administrator had been performed, and, therefore, no costs should be taxed against him. We understand, further, that the exceptions involving the administrator have been abandoned.

This case is different from the case of Gilliland and Howell v. Caldwell, 1 S. C., 198. In that case, the claim of the creditor was upon a promissory note, and although it had been established against the administrator, or at least against the estate in a creditor’s bill in 1847, and received its pro rata of the personal assets, yet the heirs who were in possession of the real estate, and remained in possession until 1863, when the creditor exhibited his bill against them to subject the real estate to the payment of so much of the debt as remained unpaid, was allowed to plead the statute, and it was held that the bill was barfed by the statute. The heirs not being bound by the establishment of the debt previously, and the note upon which the debt was founded being a promissory note, the heirs, when they were sued, had the right to meet it by the statute. Such would be the law here if the notes of the plaintiff were promissory notes, but they are sealed, notes, and twenty years have not elapsed, giving rise to the presumption of payment.

The case of Mobley v. Cureton (2 S. C., 140) is more like this. There, a creditor attempted to subject lands in the possession of the heirs to his debt represented by sealed note of the ancestor. The administrator had been sued on this note and judgment obtained in 1860. Thirteen years afterwards, the heirs being in possession all this time, the proceeding to subject this land to the payment of his debt was instituted; held, that the plaintiff was barred by his laches of his remedy in equity, and the bill was dismissed without prejudice to plaintiff’s right to pursue the heirs at law. The decision, however, was based principally upon the ground that the creditor, by his laches, had not exhausted the personal assets, which the court held was the primary fund for the payment of the debts, and which, by the delay of the creditor, has been lost in the hands of the administrator. Here, the creditor has, by the decree of Judge Wallace, been ordered to accept as a credit on his notes his pro rata of the assets in the administrator’s hands. It was further held in that case, that the statute of limitations being inapplicable to an action at . law against the heirs of an intestate to recover a specialty debt of the intestate, it cannot be pleaded to a bill in equity against the heirs to subject real estate descended to the payment of a debt due on a sealed note. If, however, the plaintiff in such a bill has been guilty of laches, the court may refuse him its aid, and bar the equitable remedy at a period short of that which would raise the presumption of payment.

In the case of Cleveland v. Mills (9 S. C., 430), the court held that the statute of limitations applies to an action against heirs to subject real estate in their possession to the payment of the debts of the ancestor. That was a case, however, of a suit on a guaranty, and four years not having elapsed when the ancestor died, and -the creditor having commenced his action within the four years, deducting the nine months allowed the executor, it was held not barred.

The complaint below seems to have been regarded by his honor, Judge Fraser, as framed in a double aspect, to wit, both at law and in equity. Admitting this .to be so, still it cannot avail the defendants, heirs at law. In the law aspect, we find the notes sued on sealed notes, and within the twenty years necessary to presume payment; and, on the equity side, the Circuit Judge has not found such laches on the part of the creditor as would bar his equity under the cases supra.

It is the judgment of this court, that the judgment of the Circuit Court be affirmed.