29 N.J. Eq. 625 | N.J. | 1878
The opinion of the court was delivered by
The questions in these cross-appeals relate to the distribu-' tion of personal estate under the will of Thomas F. Potter, deceased, late of Princeton, in the county of Mercer. By
No reserved fund for the annuity was actually set aside by the executors, but the whole assets held by them for the widow' and children continued in an undivided mass till 1858, after the oldest child had come of age. These assets were about $645,000, being the stocks and bonds of railroad, bank and other corporations, besides ordinary bonds and mortgages. About $340,000 of the assets were the stocks and bonds of the Joint Companies of New Jersey (Camden and Amboy, &c.), which, together with the other assets, except bonds and mortgages derived from the sale of real estate, were owned by the testator at his death.
In this condition of the estate, John Potter, the eldest son, became of age, and entitled to his share of the residuum, under the fifth clause of the will. The executors, on the 21st of January, 1858, transferred and delivered to him securities amounting to the agreed value of $127,250, the receipt of which he acknowledged by his deed, specifying the secui’ities and the'value of each as so much money on account of his share of said estate. The securities so transferred to him were selected from the different kinds composing the entire mass, with an evident, though not exact,
The first and controlling question in the suit grows out of the transactions up to this point, and is the question of the true construction and effect to be given to these transfers to the sons—Eor whom and in what manner, from December 2d, 1859, must the assets then remaining, and valued at $391,000, be now deemed to have been held ?
From the date just named to Mr. Field’s death, in May, 1870, a period of about ten years and a half, the estate was exclusively in his hands, his co-executors having died or ceased to act. During this time a great increase took place in the productiveness and market value of some of the assets—i. e., the Joint Companies’ bonds and stock—but, during the same period, large losses occurred to the estate, by reas.on of mismanagement on the part of the acting trustee. These two facts make it the interest of the sons, on the one side, and the daughters on the other, to contend for different constructions of the above transfers to the sons.
On the 7th of June, 1870, soon after the death of Mr. Field, the two daughters, with their husbands and minor children, filed their bill in this • suit against the two sons, together with' Francis S. Conover, Mr. Field’s administrator, praying that an account might be taken of the trust estate, a receiver appointed, the alleged waste made good, and such further orders and decrees as in the premises might be fit. Answers were filed, and, on the 1st of August, 1871, a reference was made to Mr. Gummere, as master. The testimony taken before him, the exhibits offered, and the extended statements of accounts prepared
To the master’s report, dated December 9th, 1872, numerous exceptions were filed, both on behalf of the daughters and the sons, all of which, upon argument before the chancellor, were overruled, with the exception of two, involving slight or clerical errors. By an order of January 5th, 1875, the cause was recommitted to the master, to whose second report, dated March 20th, 1877, numerous exceptions on both sides were again filed, and all but one, relating to interest, overruled by the chancellor, from whose final decree, dated June 6th, 1877, the contending parties have taken the cross-appeals argued in this court.
The argument here turned mainly on what has been said to be the first and controlling question in the case—namely, that of the construction and effect to be given to the transfers of property in 1858 and 1859, to the sons. For whom and in what manner should the funds or assets remaining after such transfers, be now deemed to have been held? Taking these assets or securities at the same value that was put upon securities of the like kind when transferred to the sons, they then represented the sum of $391,000. They included nine hundred and ninety-four .shares of the Joint Companies’ stocks, at par value, $99,400. The two sons had received from-the executors nine hundred and eighty-six shares of these stocks—John four hundred and eighty-eight, and "William four hundred and ninety-eight shares. The nine hundred and ninety-four shares retained by the executors increased greatly in value during the following years. Large cash and stock dividends were declared, three hundred and sixty-four new shares being in this way added to the nine hundred and ninety-four, which latter were subsequently converted into United States bonds, at the par value of $150,000, making, as the master reports, a total increase in this kind of security or investment of at least $130,000, in currency valuation, besides the dividends
On behalf of the daughters it was contended, before the master and the chancellor and in this court, that the transfers to the sons were not properly payments to them, but allotments of specific securities; and that, in 1859, it was the duty of the executors to have separated the respective portions of the daughters from each other and from the annuity or reserved fund (setting apart mortgage securities of a proper amount for the annuity fund) and to have allotted to each of the daughters a like number of the same securities that had been delivered to the sons ; that equity will now administer the assets as if such allotment had been actually made, for the reason that what ought to have been done will be treated as done. The result of this would be to give exclusively, or nearly so, to the daughters the accretions on the Joint Companies'’ stocks, and on the government bonds into which some of the stocks were converted.
On behalf of the sons it was contended that the securities taken by them were taken as cash; that there was no allotment or partition of securities, as such, to them, but simply so much money received by them on account of their shares; that equal amounts should now be set aside or held for the daughters, with proper adjustments for interest and past receipts, and that all the accretions sought to be appropriated exclusively by the daughters, should be divided equally among the daughters and the sons, due provision being made for the reserved fund. In other words, they insist that the equal shares to be paid them under the will are those which shall now be equal with the amounts to be held for the daughters, taking into account the receipts and payments heretofore made.
Neither of these methods of distribution was approved by the master or the chancellor. One based on a different view, and intermediate between those contended for, was
I think this view is the most correct and satisfactory that can be reached. The claim of a specific allotment of securities is inconsistent with the facts as they occurred. The transfers to tlje sons were meant to be what they were described at the time to be—payments on account of their shares. They were receipted for as so much cash paid, and I think it equally clear, from all that occurred at the time an.d afterwards, as shown by the documentary evidence, that the payments were then understood to be in fulfillment of the provisions of the will, by which the equality of their shares was referable to the time of their coming of age, and not in the sense contended for, as referable to the final distribution of the reserved fund. The last-named fund and the shares of the daughters are properly adjudged to bo represented by each l’emaining security in the proportions above named. If the $391,000 remaining had been money, and had been invested, for example, in one mortgage, or in five mortgages of equal amounts, and held in the same gen
It is a manifest objection to the soundness of both of the theories contended for by 'the parties, that they are judgments or elections after the event. Had the securities in question decreased in value, instead of increasing, it is safe to say that the theories now advocated would be resisted on both sides; and with justice. The contention for the sons, to the effect that it was the requirement or intent of the will that they should share in the increase and not in the decrease; that they should be gainers' by the good management of the trustee in dealing with the remaining estate, after the payments absolutely to them, and not also losers by his bad management of the same estate; that the daughters were to take a part only of the gains in the former ease, and to bear all the losses in the latter case, is without support in the will or the equity of the case. The principles of distribution, and also the manner in which they have been applied by the master to the making up of the different accounts; the apportionment among the daughters and the annuity fund of the money and assets derived from
Among the numerous minor questions covered by tbe conclusion thus expressed, there are two which seem proper to be more specially referred to, growing out of the delivery by the trustee, in 1867 and in 1870, of bonds and stocks to "William II. Potter, for himself, individually, and as the assignee of his brother John. The bonds and stocks so delivered were those of the Joint Companies—the bonds, at par value, $20,000, and the stocks, at par value, $10,000. They were taken by William in the belief, warranted by the representations of the trustee, that the accumulations of the reserved fund had been sufficient to enable the trustee to pass them over to William, on account of his undivided fourth interest in that fund, and the one-fourtli interest therein assigned to him by John, and yet leave the fund large enough to yield the annuity to the widow. There is no reason to doubt that William took them in good faith, supposing his right to them good. In view, however, of the devastavit subsequently found, and committed certainly before the transfer of the stock, and presumably before that of the bonds, the decree imposes upon William the obligation to respond to the daughters and the annuity fund for the present value of the bonds and stock, such values being apportioned to each by the percentages before named. As to this part of the case, it was insisted, first, on behalf of the sons, that the decree is erroneous in charging them with these values; and, secondly, on behalf of the daughters, that the decree is erroneous in not charging the sons with interest on the coupons and dividends from the times when respectively due. I think that the decree, as to both points, is right.
The stock and bonds w.ere part of the undivided mass, and belonged to the daughters and the reserved fund in the proportions as above. The waste of the trustee impaired
Nor do I think that the objection that it goes beyond and is unwarranted by the pleadings, can be regarded as well taken. The objection is, that there is nothing in the bill of complaint which.authorizes any action against John or William Potter, or which makes them or their rights in this fund amenable to the decree. The answer to the objection is that the bill is for an account—for an ascertainment of the course and condition of the estate under the management of the trustee, of the disposition made by him of the funds and securities in his hands, Avhere and what they are, as well as to recover from the estate of the trustee the alleged losses by Avaste—and, this being the expressed object of the bill, I am unable to see Avhy what has been done is not strictly within its scope.. The sons are defendants, and, in investigating, the accounts and management of the trustee, the inquiry necessarily extended to Avhat had been paid or transfeiT'ed to them. A legitimate result to be reached was the adjustment of the respective accounts of the sons and the daughters as the same ought to have been adjusted by the trustee, showing the respective relations of the sons and daughters to the remaining estate of their father. This object of the suit was recognized and acted on throughout by both complainants and defendants. The evidence on both sides was produced and made use of to accomplish it. The decree but embodies the results so arrived at. It is not one for recovery against the sons, but adjudges the true condition of the accounts, deducting from the credits or shares due the sons the values of the stock and bonds with which they are found to be chargeable.
Interest is the damages given by law for the detention of a debt. Up to the highest rate allowed by law, it may be regulated or waived by agreement of parties. On money lent to be paid on demand, no interest accrues or can be recovered until after demand made, unless the contrary be provided for by contract. "Where money is paid and received under the mistaken idea that it is due to the person receiving it, an agreement to pay interest, either express or implied, is, of course, negatived and excluded, and, until discovery of the mistake and demand made, the obligation to pay interest as damages for detention or use of the money, does not legally arise. No injury arises from such detention, because it is the voluntary act of the party to whom the money rightfully belongs. Volenti non fit injuria. The cases are in accordance with this doctrine. Jacobs v. Adams, 1 Dall. 52; Brown v. Campbell, 1 S. & R. 176; Second Street Railway v. Philadelphia, 51 Pa. St. 465; Hubbard v. Charlestown Railroad, 11 Metc. 124; Rowland v. Best, 2 McCord Ch. 317.
The adjudged cases cited in opposition to the decree on this point, are all cases where there was no holding under a mutual mistake as to ownership, and are not at variance with those I have referred to. They stand on a different principle. •
Decree unanimously affirmed.