30 S.C. 549 | S.C. | 1889
The opinion of the court was delivered by
On the 31st of January, 1859, James Chapman departed this life, having first duly made and executed his last will and testament, with a codicil thereto, the one bearing date the 27th of May and the other 5th of July, 1856. By his will, the testator appointed his three sons, Thomas E., James,
By the third clause, the testator gives to each of his three daughters, naming them, the sum of twenty-five thousand dollars, saying: “This bequest to each of my said daughters, I do not intend shall, in anywise, abate or contribute, in case of any deficiency of my estate, but shall be held as a provision made for my said daughters, and to be preferred over all others.” But he goes on to provide, that if, from any unforeseen contingency, the balance of his estate should not yield a sufficient income to afford an adequate support for his widow, then the annual income from each of the sums given to the daughters shall be charged with a contribution in equal portions with so much as may be necessary to make up a sum sufficient for the proper maintenance of his widow during her life or widowhood. He then directs “that the said sum of twenty-five thousand dollars shall be taken in the most secure investments I have, such as stocks or bonds of the city of Charleston, or stocks of the State of South Carolina” ; and further provides, that the sums thus given to the daughters, as well as any other portion of bis estate to which they become entitled on the final division of his estate, “shall be taken and held by trustees hereinafter to be named, and in the manner hereinafter to be provided.”
In the fifth clause, the testator directs that the whole of his estate shall be kept together by the executors until the youngest daughter shall attain the age of 21 years, unless all of the daughters shall marry before that period. “And then and in that event, I desire, and so devise, that my estate be divided in the following manner: First, that from it shall be taken, as is here
In the eleventh clause, the trustees of the daughters are named, and in the twelfth, after naming the executors, the testator says: “And I give them power to sell and dispose of such parts of my estate as they may think expedient, except such public securities as I have directed should constitute the sum of twenty-five thousand dollars for each of my said daughters, and my dwelling house, with the furniture, plate, servants, and other appurtenances of the same.”
In the fourth clause, the testator makes provision for his wife during her life or widowhood, giving her, amongst other things, so much of the income of his estate as may be necessary to maintain her and such of his children as may require it, in the style to which they were accustomed during testator’s life-time, and directs that any surplus of such income shall be invested annually by the executors in approved public securities, “which shall be considered as part of my estate in the division of the same, which I hereafter direct.”
In the sixth clause, the testator provides for his widow in case a final division of his estate shall become necessary, by reason of the marriage of all the daughters, or from any other unforeseen cause, before the youngest daughter shall attain the age of 21 years, and his wife shall then be alive and continue a widow, by which, after giving his dwelling house and certain other property to his wife for life or during widowhood, he directs his executors, in making the division of the estate, to “set apart the sum of thirty thousand dollars in secure public investments,” the annual income from which shall be paid to the wife during her life or
The seventh clause makes provision for testator’s sons, the particulars of which we do not deem it necessary, for the purposes of this inquiry, to state, further than to say that the plaintiffs claim that under the limitation found in this clause they succeeded to the share of their father. The eighth and ninth clauses of the will need nottbe specially noticed further than to say that they both show that no division of the estate was intended until the youngest daughter married or attained the age of 21 years. So, also, as to the tenth clause, there is nothing in it which can affect the present controversy. The same remark is applicable to the first and second clauses.
The testator left surviving him his widow, two daughters, and three sons, the other daughter having died during his life-time, leaving no issue. Both of the surviving daughters died in 1861, leaving no issue. Thomas E. Chapman, one' of testator’s sons, died in 1868, leaving two children, who are the plaintiffs in this action ; Robert B. Chapman, another son, died in 1868, leaving two daughters, who are defendants herein; and the third son, James Chapman, jr., died in 1881, leaving five children, who are likewise defendants herein ; and finally, the widow of the testator died 6th March, 1887.
It appears from the inventory of testator’s estate, that the only public securities held by him at the time of his death were fifty thousand dollars of city of Charleston stock, represented by various certificates bearing different numbers, and twenty-three thousand seven hundred and ten dollars of State stock. The books of the city treasurer, which were offered in evidence, show that all of the city stock has been transferred at different times to different persons, all of these transfers having been made by Robert B. Chapman, executor, except one, where the original certificate having been lost, it is not known who signed that transfer. These books show that two of the certificates, No. 169 and No. 170, for
The plaintiffs claim that the stock represented by certificate No. 3,005 had been set apart to testator’s widow by the executors under certain proceedings set out in the record; and that upon her death, they, as the children of one of testator’s deceased sons, Thomas E. Chapman, together with the children of the other two deceased sons, Robert B. Chapman and James Chapman, became entitled to said stock, in the proportions stated in the complaint; that the transfers of said stock, made by Robert B. Chapman and James Chapman, executors, to George W. Williams & Co., “were illegal and void, and were made through the carelessness of the officers and agents of the city, and by reason thereof the said stock has been wholly lost to the plaintiffs and the other parties entitled thereto.” They, therefore, bring this action, to require the city of Charleston to deliver the city stock thus illegally transferred to the plaintiffs and the other parties entitled thereto, or account to them for the same; and as the children of Robert B. Chapman and the children of James Chapman declined to unite in this action as plaintiffs, they have been made defendants.
It is alleged in the complaint, and the fact is so, that on the 25th of May, 1866, a bill was filed in the Court of Equity by J. W. Caldwell, Robert B. Chapman, and James H. Wilson, as executors of James Chapman, against Thomas E. Chapman, James Chapman, and such of the children of the three sons as were then in esse, who were supposed to be remaindermen under the will, for the settlement of the estate of the testator, in which the executors stated that they were ready to account and to set apart the widow’s share, but were unwilling to turn over the shares of the testator’s sons to them, as they were advised that they were only entitled to a life estate with remainder to their children, and that
The chancellor, holding that the period for distribution had arrived, adjudged that the sons weve entitled to have possession of their shares, Whether their estate were absolute or for life only, and referred it to Master Tupper, to inquire and report a scheme for the settlement of the estate. On the 12th of July, 1886, Master Tupper filed his report, setting forth in detail what property had been allotted to the widow and the three sons respectively by the executors, in which he recommended that such allotment be confirmed, and “that upon the delivery to the widow and sons of the real and personal property assigned to them respectively, the executors be discharged”; arid this report was confirmed, by consent, by an order of Chancellor Carroll. The allotment to the widow embraced, among other things, $20,000 of city stock, as to which Master Sass, to whom the issue in the present action was referred, found, as a matter of fact, that certificate No. 3,005, above referred to, represented the stock then allotted to the widow, though it does not appear that such stock was ever transferred to the widow, but, on the contrary, it remained on the books in the name of the estate of James Chapman until it was transferred to George W. Williams & Co., as above stated.
When the record of these proceedings in the late Court of Equity was offered in evidence, the city council objected upon the ground that, they not being parties thereto, it was res inter alios aeta, and in the absence of any evidence that they had notice of such proceedings, such record was incompetent evidence against them. The master overruled the objection, and the city council excepted. For the reasons stated in his report, which is set forth in the “Case,” the master found that the transfers of stock by the executors to George W. Williams & Co., above referred to, were made without authority, and that the city council of Charleston was responsible for the damages resulting to the plaintiffs therefrom. To the report the city council filed exceptions, and the case was heard by his honor, Judge Norton, upon report and exceptions, who rendered judgment sustaining the
The fundamental inquiry in the case is, whether the executors, all or some of them, had the power to transfer the stock in question. There can be no doubt that at common law an executor had an absolute power of disposal of the whole personal property of his testator : 2 Williams on Executors, 670 (2nd edit.); and while it is true that this absolute power has been restricted by the act of 1824, now incorporated as section 1976 of General Statutes, requiring that he shall first obtain an order of sale from the proper tribunal, unless such sale is directed by the will, it has been settled in this State by the case of Rhame v. Lewis (13 Rich. Eq., 299), recognized and followed in Reynolds v. Rees (23 S. C., 448), that such restriction does not apply to the power of an executor to transfer choses in action. So that if this stock is a chose in action, there can be no doubt of the power of the executors to transfer it, unless forbidden by the terms of the will to do so.
It seems to us that this stock must be regarded as a chose in action. It is nothing more than an acknowledgment that the city council of Charleston is due to the person named in the certificate or his assigns the sum of money specified therein, which is payable at the time therein stated, with interest, at the rate specified, payable at certain stated times, with a stipulation that the same is transferable only at the office of' the city treasurer. It is a mere promise to pay a certain sum of money at a time stated, with interest thereon, at a specified rate, payable at certain stated periods. Such a paper, signed by an individual, would unquestionably constitute a chose in action, and the fact that this paper is executed by a corporation cannot have the effect of altering its nature and legal effect. It follows, then, that no order of sale was necessary to render these transfers valid.
Inasmuch as the right to transfer this stock does not rest alone upon the power of sale conferred by the will, but might have been lawfully exercised under the common law powers of the executors, it is scarcely necessary to consider the point raised in the
Our next inquiry is, whether there is anything in the will forbidding the exercise of this power of sale. So far from there being any general prohibition in the will as to the exercise of this power of sale, the testator has, on the contrary, expressly invested his executors with power to sell any part of his estate, except certain specified portions thereof. His language is: “I give them power to sell and dispose of such parts of my estate as they may think expedient, except such public securities as I have directed should constitue the sum of twenty-five thousand dollars for each of my said daughters, and my dwelling house,” &c., which he intended as a home for his wife and children. a
It will be observed that the testator does not specify any particular public securities as excepted from the power of sale, but he only refers to them in general terms as such public securities as he had directed should constitute the sum of money intended for each of his daughters. The legacies to the daughters are not specific legacies, and they can scarcely be regarded even as demonstrative legacies, for no particular fund is designated out of which they were to be paid, as in Boykin v. Boykin (21 S. C., 532); but the direction is simply that these sums of money intended for the daughters “shall be taken in the most secure investments I have, such as stocks or bonds of the city of Charleston, or stocks of the State of South Carolina,” but no particular stocks or bonds are designated as the fund out of which they were to be paid. It is clear, therefore, that they might have been paid in
It does not appear what amount of public securities the testator owned at the time he executed his will, though it does appear that at the time of his death he owned city and State stocks to the amount of $73,710, a sum insufficient to make the provision intended for the three daughters. The testator must, therefore, have expected when he signed his will to acquire additional public securities before he died, or intended that his executors should do so after his death; but the death of one of his daughters during his life-time rendered this unnecessary, as the amount of public securities on hand at the time of his death was much more than sufficient to make the required provision for the two surviving daughters.
It will be observed that by the fifth clause of the will the testator directs that the whole of his estate should be kept together until his youngest daughter married or attained the age of 21 years, “and then and in that event” the estate was to be divided in the manner prescribed: “First, that from it shall be taken the sum of twenty-five thousand dollars in the manner hereinbefore directed” — that is, in public securities — “which shall be transferred to trustees;” &c., and the same clause goes on to provide that upon the death of any daughter without issue, the share of such daughter under the will “shall cease and determine, and the same and every part thereof shall be divided among my other children, share and share alike.” So that it is quite clear that until the period fixed for a division arrived, the portions intended for the daughters could not be taken out of the estate and transferred to their trustees; and as all the daughters died without issue before that period arrived, it never did become necessary or even permissible to separate their portions from the rest of the estate, and hence, in the events which have happened, no portion of the estate was excepted from the power of sale conferred upon the executors, except the dwelling house and other specific articles given to the widow.
The whole tenor of the will shows that the testator did not intend to except public securities from the power of sale conferred • upon the executors, because he regarded them as the safest of all
It is significant, in this connection, to notice that the thirty thousand dollars in public securities, which, in the sixth clause of the will the testator directs, in a certain contingency, shall be set apart for the widow, are not excepted from the power of sale conferred upon the executors, but only such public securities as. he directed should be set apart or taken out of his estate for his daughters and placed in the hands of trustees when the period for division should arise.
But in any view of the case, it was incumbent on the' plain-' tiffs to show that this particular stock represented by certificate No. 3,005, the alleged illegal transfer of which constitutes the basis of their claim, was excepted from the power of sale, and this they have failed to do. There is no doubt that, as this stock-originally stood on the books of the city treasurer in the name of the testator, and was afterwards consolidated into one certificate in the name of his estate, the city authorities must be: presumed to have examined the will before they could properly allow the stock to be transferred; and if they failed to make such examination, they must be presumed to have had notice of everything that such an examination properly conducted would have disclosed. Now, if they had made such examination, they would have learned that the executors had full power to dispose of any public securities except such as were.
It is, however, contended that when, under the proceedings in the Court of Equity above referred to, the stock in question was allotted to the widow in the division then made under the supervision of the court, the power of sale was determined, and any subsequent transfer by the executors was wholly without authority. While that may be so as to the parties to that case or their privies, and would be so as to the city council if they had had notice of such proceedings, yet as they were neither parties nor privies to that case, and had no notice of it, we do not see how they can be affected by anything that was done under that case. There was nothing in the will to indicate that there was any likelihood or expectation of an appeal to the courts for any purpose. On the contrary, the whole tenor of the will, especially the provisions of the tenth clause, indicated that the testator did not intend or expect that any resort should be had to the courts for the purpose of carrying out the provisions of his will
Hence, while the city authorities must be presumed to have had knowledge of the contents of the will, such knowledge, instead of inducing them to inquire whether there were any proceedings in the courts in reference to the estate, would have had rather the contrary effect. The parties to that case took no steps to inform the city council of what had been done, or to transfer the stock to the widow, or to any one for her, but it was suffered to remain on the books of the city treasurer in the name of the estate of the testator, apparently subject to the control and disposition of his executors, and there was nothing whatever done,
The position taken in the argument that under the proceedings in equity the executors were discharged with their own consent, and therefore had'no power to transfer the stock, is fully disposed of by what is said by the Circuit Judge: first, that under the order the executors were to be discharged upon certain conditions, which were never complied with; second, that the court had no authority to discharge them. Campbell v. Bank of Charleston, 3 S. C., 384.
The judgment of this court is, that the judgment of the Circuit Court be affirmed.