Abrams v. United States Fidelity & Guaranty Co.

127 Wis. 579 | Wis. | 1906

WiNSlow, J.

The guardian was a trustee of the funds of her wards. It was her duty, on receiving such funds, to keep them for her wards, and to invest so much of them as was not required for immediate and necessary use, as soon as she could do so with reasonable diligence. She could employ an attorney to collect them, and, if she exercised reasonable care and prudence in the choice of an attorney, doubtless she would be protected from losses occurring by the fraud or negligence of the attorney in the course of his duty as collecting agent; but when she had received the funds by draft or in cash tbe functions of tbe attorney; for collection ended, and if sbe then placed tbe fund in bis bands to invest be became simply an agent to whom sbe bad attempted to delegate ber duties as trastee. Mr. Lewin, in bis work on Trusts (vol. 1, p. 252), says:

“Trustees wbo take on themselves the management of property for the benefit of others have no right to shift their duty on other persons; and if they do so they remain subject to tbe responsibility towards their cestuis que trustent for whom they have undertaken tbe duty. If a trustee, therefore, confide tbe application of tbe trust fund to tbe care of another, whether a stranger, or bis own attorney or solicitor, or even co-trustee or co-executor, be will be held personally responsible for any loss that may result.”

This principle is firmly established. It does not mean that a trustee may not employ a broker or attorney to do those things which in tbe ordinary course of business such agents would be employed to do, but simply that be cannot delegate to others the doing of those things which be is in duty bound to do himself. The collection of claims against others involving actions at law or negotiations for settlement may well be intrusted to an attorney. Tbe guardian has not undertaken to act as an attorney, but tbe care and investment of tbe funds which reach bis bands is one of tbe very things which tbe guardian has agreed to attend to, and if be delegates this duty to another, whether be be an attorney or a layman, be makes such other bis personal agent and is responsible for bis acts. A guardian’s duty, by tbe terms of bis appointment, is “to dispose of and manage” bis ward’s estate according to law, and such is tbe tenor of bis bond. He may employ attorneys or agents according to tbe usual course of business to reduce tbe estate to possession and to protect it, but when once in bis bands bis personal duty to dispose of and manage it begins, and this duty is not to be delegated.

These considerations really dispose of the most serious question raised by tbe appellant in this case, namely, tbe question whether the guardian should be charged with the sums received from the railroad company, the Order of Foresters, and the administrator of Avery’s estate in Colorado. The claim is that these sums never, in fact, came to the hands of the guardian, but were squandered by the attorney in the process of collection. The court found, upon sufficient evidence, that these amounts were represented by bank drafts or checks payable to the order of the guardian, which came to the guardian through the attorney, and that the guardian indorsed them and handed them back to the attorney, to be invested by him for her as guardian. It must-be held that, when the draft came to her hands, she came into possession of so much of her ward’s estate. Her personal duty to manage that estate then began. It is claimed that interest should not have been charged upon the funds which came to the guardian’s hands prior to the expiration of six months from the time of their receipt. This is a matter resting in the sound discretion of the trial court in view of all the facts. The court allowed about two months upon a part of the funds, and three months upon the balance, during which time no interest was charged. The fact being that the guardian absolutely neglected her duties and made no attempt to invest the funds, we cannot say that there was any abuse of discretion. In re Thurston, 57 Wis. 104, 15 N. W. 126. Interest was charged on the sum of $482.98, received from the estate of Herbert D. Avery, from April 1,1901, and it is claimed that the testimony shows that this amount was not actually received until November, 1901. There was certainly testimony to this effect, but by the stipulation of facts in the case it was expressly stipulated. that the sum was received about February 1, 1901, and that no testimony should be received in conflict with the stipulation. As no application was made to the trial court by the appellant to be relieved from the stipulation, it must be held to control.

It is contended that the court should have allowed the guardian a reasonable sum for lodging of tbe children and for her personal services in their care. The fact was that she voluntarily stood in loco parentis to these children and never intended to charge them anything for lodging or services. Under these circumstances neither the guardian nor the surety has any right to such credit. Hudson v. Jenson, 110 Wis. 26, 85 N. W. 689. The court allowed the guardian interest on her disbursements at six per cent, per annum from a period midway between the time of her appointment and the time of her resignation. This was not the proper plan of accounting. Annual rests should have been made, and the amounts expended for the preceding year deducted, and interest computed on the balance up to the next annual rest; but, as the result of the method adopted by the court is more favorable to the appellant, there was no prejudicial error. In,re Thurs-ton., supra. The allowance of costs in the circuit court is complained of, but no reason is perceived why such action was not strictly right.

By the Court. — Judgment affirmed.