280 Mass. 325 | Mass. | 1932
This is an appeal from a decree of a probate court touching an executor’s account. Findings of material facts by the trial judge show that in December, 1926, a house and lot were purchased and the deed taken in the name of the accountant who was and had been for many
A stenographer was appointed under G. L. c. 215, §§12, 18, to take the evidence. Several matters were in controversy at the hearing. The parties filed a stipulation reciting a brief excerpt from the cross-examination of the accountant and agreeing that the only questions now presented for decision relate to the items charging the accountant with the sale price of this real estate and interest thereon, and that sufficient evidence was introduced to support the findings of fact made by the trial judge and that it could not be found or ruled that such findings were plainly wrong, and that everything not material to the questions may be omitted from the record. The trial judge certified that the stipulation and findings contain an adequate summary of the proceedings material to the issue raised by the appeal. The record has been printed in this abbreviated form. This was correct procedure under G. L. c. 214, §§ 24, 25, imported into probate practice by G. L. c. 215, § 12. Gerrity v. Wareham Savings Bank, 202 Mass. 214, 219. Robinson v. Donaldson, 251 Mass. 334, 336. Romanausky v. Skutulas, 258 Mass. 190,
The transaction between the accountant and Miss Borden wherein the purchase price for real estate was paid by her and the title taken in his name created a resulting trust for her benefit. He held the legal title in trust for her and she was the beneficiary. He was the trustee and she was the cestui que trust. Howe v. Howe, 199 Mass. 598, 600, 601. The nature of her interest was an equitable estate in fee. Peabody v. Treasurer & Receiver General, 215 Mass. 129, 131. Baker v. Commissioner of Corporations & Taxation, 253 Mass. 130, 138. Coolidge v. Old Colony Trust Co. 259 Mass. 515, 521. It was said in Cushing v. Blake, 3 Stew. (N. J.) 689, 695: “Trust estates are subject to the same incidents, properties and consequences as, under like circumstances, belong to similar estates at law. They are alienable, devisable and descendible in the same manner.” Cornwell v. Wulff, 148 Mo. 542, 554. Stonecypher v. Coleman, 161 Ga. 403, 409. Perry on Trusts, § 357. G. L. c. 190, § 3. It follows that the interest of the testatrix at the time of her death in this property had all the incidents of real estate. It would go to her devisees or, in the event of intestacy, to her .heirs at law. An executor in the absence of testamentary power conferred upon him has nothing to do with real estate save in appropriate instances to collect and be accountable for the rent, G. L. c. 206, § 8, unless and until he is licensed to sell it for the payment of debts and legacies under G. L. c. 202. Hooker v. Porter, 271 Mass. 441, 446. Therefore if the real estate had not been sold by the accountant as holder of the legal title, it would have no proper place in his account. The devisees under the will of the testatrix would succeed to her as holding an equitable estate in fee in it. The accountant has sold the real estate and converted it into cash. Such sale was made by him in his capacity as trustee holding the legal title and not in his capacity as executor. Doubtless these are separate and distinct capacities. It is important to preserve and enforce this distinction. Welch v. Boston,
The accountant however is a single individual combining in one personality both the executor and the trustee. He has been to a certain extent faithless as trustee by refusing to recognize his trust relationship, by conveying the real estate held by him subject to the trust as if it were his own absolute property, converting it into cash and asserting ownership of the cash thus received and refusing to pay it to its rightful owners. He is in a probate court with respect to a matter where the proceedings are to be considered to be for all purposes in equity. G. L. (Ter. Ed.) c. 206, § 4; c. 215, §§ 2, 3, 6. He holds money as it were in one hand for which he must account as the executor and money in the other hand for which he must account as the trustee, both relations having been created and established by the testatrix. It has been found expressly that the “residuary legatees are willing to accept the price obtained as the fair value of the property.” The necessary implication of this finding is that all the beneficiaries under the resulting trust, arising from the purchase of the real estate with the money of Miss Borden and the taking of title in the name of the accountant, are before the court now as parties to the account. Therefore there is no diversity of beneficiaries. The residuary legatees must be presumed to be the cestuis que trust. They are content to have the
As trustee Cook not only wrongfully denied the existence of the trust but he wrongfully converted the real estate held by him as trustee into money and holds it for his own. No advantage as executor ought to accrue to him from this course of conduct. All persons in interest are before the court and all except him desire to treat the trust res as money. There is authority to the effect that, if a third person were trustee, who had done that which Cook has done in his capacity as trustee, the executor, if actually representing all the cestuis que trust, could maintain suit for the recovery of the trust fund. In those circumstances, as between an executor and such faithless trustee, the trust res would be treated as money, although as between the executor and the beneficiaries of the trust the money would be regarded as real estate in the final distribution. That clearly would be so if the faithless conduct occurred before the death of the testatrix. Parker v. Simpson, 180 Mass. 334, 358-359. See Clark v. Seagraves, 186 Mass. 430, 437. It is established that an executor must treat any debt owed by him to his testator as a money asset of the estate and account for it as executor. Hobart v. Stone, 10 Pick. 215, 220. Leland v. Felton, 1 Allen, 531, 535, 536. This is an application of the principle that an executor ought not to gain any personal advantage from his trust position which he would not otherwise possess. Coffey v. Coffey, 193 Mass. 398, 399.
The issues involved appear to have been fully tried. It is desirable that circuity of action be avoided. The case is unusual. Manifest justice seems to require that the controversy be settled on the findings made after a fair hearing. The difficulties in the way are highly technical. While orderly processes although savoring sometimes of technicality must be preserved, Clabburn v. Phillips, 245 Mass. 47, theré is in our decisions strong analogy, if not direct authority, to support the conclusion that the present proceeding affords a remedy. All parties in interest are before a court of equity. The issue has been raised upon
Decree affirmed.