78 F. 536 | 6th Cir. | 1897
haring made the foregoing statement of facts in the case, delivered the opinion of the court.
The first question, in due order, which we are required to decide, is whether the suit is defective for the want of parties in respect to the object sought to be attained. The suggestion of the defendants is that the other legatees than William Means should have been made defendants. The object of the bill is to obtain a decree setting aside a receipt given to the administrators by William Means for the legacy given him by his father’s will, and establishing the right of the complainants to recover the amount of such legacy. It cannot be doubted that the subject-matter of the suit is one of equitable cognizance, and that the bill was filed in the proper court. Payne v. Hook, 7 Wall. 425; Byers v. McAuley, 140 U. S. 608, 13 Sup. Ct. 906. The transactions in which the receipt was obtained were conducted in behalf of the estate by the administrators, and by them only. They alone represented the estate, and they are its sufficient representatives in a suit to set it aside.
In respect to the other branch of the relief sought, attention must be given to the essential nature of the controversy. It related substantially to the question whether certain funds which had been supplied by Thomas W. Means to William Means were in the nature of a debt to the estate, and so competent to be set off against his legacy. This is the theory of the counsel who represent the administrators, and we think it is entirety correct. Ad
In the court below no question was raised as to the necessity of other parties until the hearing, when it seems to have occurred to the court that the suit might, on bringing in the other legatees, be treated as one for the settlement of the estate and proceed as such. In his opinion the learned judge held against the complainants on the principal question, “that the balance due by William Means to the estate of his father at his death was properly a debt, and not a gift.” The court thereupon caused to be entered an order giving leave to the complainants to amend their bill, so as to make it a bill for the general settlement of the estate of Thomas' W. Means, but that such amendment must be upon the basis of the conclusions of the court upon the issues already joined, as stated in the opinion of the court, and that, in default of such amendment, the bill be dismissed. The complainants having declined to amend, the court directed the following decree, which was entered:
“The complainants having failed and declined to amend their hill herein, as permitted hy the order entered May 25, 1S95, or within the extended time allowed ' by subsequent orders of this court, it is now adjudged and deci-eed that their said bill be, and the same is here6y, dismissed,' ¿nd the defendants shall recover their costs herein expended. But this dismissal is without prejudice to the right of complainants to recover in another suit the amount of one-fifth interest in the estate of Thomas W. Means, deceased, over and beyond the amount of the receipt*545 of William Moans for $136,035.75, montioned in said bill, and without prejudice to any issues not joined and found against them in this suit.”
For the reasons already stated, we think there was no defect of parties for tlie principal objects of the bill. And, clearly, at that late stage of the case, no objection of the kind having been previously taken, the defendants were not entitled to have the complainants turned out, if they were entitled to some part of the relief sought, even if the suit were so constituted that all the purposes of a bill of wider scope could not be accomplished. Mc-Gahan v.Bank, 156 U. S. 218, 15 Sup. Ct. 347; Society of Shakers v. Watson, 15 C. C. A. 632, 68 Fed. 730.
The court below must have thought that the bill was sufficient for the purposes of deciding that the advances made to William Means constituted a debt to the estate, for it entered a decree which was expressly made final on that subject. The court declined to decide whether the receipt in question was valid or not, leaving that as one which might be tested on the final settlement. But the bill alleges the title of William Means to the legacy, and, in effect, the fraudulent procurement of the receipt from Mm without payment, and with knowledge of the complainants’ rights under their assignment from the legatee. The pleadings were understood to involve the validity of the receipt while the parties were taking the testimony. We cannot doubt that this question was fairly open for decision, and we conclude ihat the proper parties were before the court for deciding as well the question of the existí nee of the claim as a debt as also the question whether the receipt was a valid recognition of it, and a release thereof.
Counsel for the administrators claim that, if William Means owed this debt, as one which survived the testator’s death, it was and is proper matter of set-off against his legacy, and we think this claim well founded; and the proposition has, in this case, the support of an additional equity arising from Use insolvency of the legatee. 2 Woerner, Adm’n, § 564; Wat. Set-Off, §§ 189, 190; Courtenay v. Williams, 3 Hare, 539; Hodgson v. Fox, 9 Ch. Div. 673; Blackler v. Boott, 114 Mass. 24; Brown’s Adin’r v. Mattingly, 91 Ky. 275, 15 S. W. 353.
Upon the merits, the fundamental question is that which relates to the construction of the will of Thomas W. Means, the fourth and fifth paragraphs of which are set out in the preceding statements of facts. Much acute analysis and criticism has been bestowed by counsel on both sides upon its interpretation, and various canons of construction invoked. But we think the intention of the testator is so clearly indicated as scarcely to require the aid of more than the primary rule that, when the dominating purpose is clearly seen, the language of the will is to be construed, if jiossihle, in such a way as to give it effect. This is called the “pole star” in discovering the intention. By the fourth paragraph, the testator devises and bequeaths all his personal property to his four living children, and the son of Ms deceased daughter, share and share alike. Then, by the fifth, after reciting that he had already made advances to the legatees, which had been charged
We are not prepared to say that under no circumstances could a debt from a legatee to the testator be created as an obligation independent of the absolution accorded by the will. Indeed, we think otherwise. But we think, also, that, having regard to the manifest purpose of the testator, when this will was made, to hold a free hand to help his children during his life as their necessities might require,, and then at the end to divide what remained of his property equally among them, the court ought to require clear proof of -some distinct purpose; on the part of the testator, during the
There is much testimony going to prove the vigorous and persistent efforts of others interested in the estate to impress upon those transactions the character which their interests inclined them to think would be just. We greatly doubt whether John
“Herewith find forms which explain themselves. Please copy, sign, and return to me at your earliest convenience. * ⅜ - Í also think it best for yon to have as herewith indicated, fearing- suits will he brought against you and other directors which may give yon trouble as it now stands.”
One of these forms was that of the note for $125,911.74. To this William, on the 21 si, replied:
“Yours of the 20th received, and I send you by this mail my note to Thomas W. Means, or order, for $12f>,911.74; receipts for §700, $1,200, and $1,000, February 10th, 11th, and 18th, respectively; and authority to dispose of sccu-*550 ri'ties, — all as' requested by you. I fully agree with your action in the premises as the best preparation for the civil suits which are likely to follow.”
On the 23d John again wrote to William, saying:
“My Dear Will: Yours of the 21st inst., note and authority to sell securities, came to hand last evening. Am sorry that my reference to father’s sight caused you trouble. He keeps cheerful and contented, walks out every day if good weather, some one taking his hand as he walks. Have explained to him my -xaction in your affairs, amounts paid, how obtained, the advantage of saving 'securities pledged from being sacrificed, etc. He understands all, but soon forgets details, so that have to explain again when next I see him, and always ends by telling me to do as I think best for you.”
In this correspondence, John’s purpose in taking the note and authority to dispose of the collaterals is somewhat (though not very) obscurely stated, but it is not difficult to understand what he meant, or how William understood it. It is contended that this was a dishonest and illegal purpose, and that William should be precluded from setting up the invalidity of the notes. But the suggestion of taking them came from John. The correspondence between him and William, above referred to, shows that William was in great trouble and distress. He was agitated by the sense of his financial disaster, his becoming discredited as a man, and the fear of impending criminal prosecution. H¿ confessed to John his unfitness for doing business, and he therefore turned over to him the.charge and management of affairs. This correspondence, as well as the other evidence, all concur in showing that William yielded^ to John’s suggestions, and followed them without question. John stood in the relation of a fiduciary toward his brother. In such circumstances it would be a strange perversion of the doctrine of estoppel to hold that William should be the party who is estopped. Such facts would indicate the propriety of holding the administrators to be estopped from setting up the products of John’s unlawful proceedings, assuming they are such, as a bar to William’s claim. The administrators do not represent any person who could have been defrauded, and it does not appear how these administrators of Thomas W. Means can assert any rights which belong to creditors, unless they are themselves such. We are convinced that the notes and instruments charging' the legacy were intended to be operative only in case the creditors should proceed against the collaterals or for the purpose of subjecting William’s legacy to the payment of their debts.
It is contended, on the part of the administrators, that it is not competent to controvert, by parol testimony, the plain terms of a written instrument, and this is undoubtedly a well-settled .rule; but it does not apply to an instrument which has been given with the intention of both the parties thereto that it should' become operative only upon some condition. 2 Whart. Ev. § 927; Burke v. Dulaney, 153 U. S. 228, 14 Sup. Ct. 816. In the case cited, the rule was stated and applied in an opinion delivered by Mr. Justice Harlan, in which he cited and discussed a large number of authorities illustrating the subject. Ware v. Allen, 128 U. S. 590, 9 Sup. Ct. 174; Pym v. Campbell, 6 El. & Bl. 370, 373; Davis v. Jones,
Having reached the conclusion that the debts incurred by William Means to his father were extinguished by the will, and that the administrators had no just foundation for claiming William’s debts as a set-off against, his legacy, it remains for us to consider whether what has been done between the administrators and William should be treated as a satisfaction of it. The defendants have exhibited extraordinary diligence in obtaining from William repeated renunciation of his claims. Some days before the testator’s death, they obtained one such, and then, upon the day of their appointment, they solemnly indorsed upon the instrument their acceptance of the same as administrators, notwithstanding he had in the meantime revoked it; and on later occasions they obtained like concessions, culminating in the receipt and order of October 16, 1890, now in controversy. Such activity on the part of an administrator executing a will, in procuring the surrender of one who, by its terms, is a legatee, excites suspicion that they were conscious of standing on dubious ground, and ill comports with the duties of one standing in the place of a trustee for all the parties in interest. It is a violation of his duty when an executor becomes a partisan for one legatee and sacrifices the other. The law will not permit any unfairness on his part, or sanction a proceeding whereby the legatee is induced by his trustee to give up valuable rights without any, or a wholly inadequate, consideration. Here there was no consideration for the abandonment of his legacy by William Means to the administrators. It is com tended by the appellees that the collaterals given up were valuable, and that William could not retain them and repudiate his receipt, Nearly all of them had been realized upon during the father’s life, and the proceeds credited to William. A small part of them only were left. The collaterals which they surrendered to him had become his own property, when the debts which they secured had
In view' of the conclusions which we have reached in respect to the title of William Means to the legacy in question, it is not necessary for us to decide whether, as against the administrators, there is any sufficient proof of the existence of the agreement between William Means and the members of his family which is said to have been made in February, 1890. The trust deed executed by him on December 26, 1891, conveyed his interest to the present complainants as trustees. As bet.ween William Means and the complainants in the Greene county court of common pleas, there having been due service of the process upon him, the decree therein rendered, and the trust deed, were effective in transferring the title, and estop him from denying that it was in fact transferred. It is no concern of the administrators whether they are required to pay the legacy to the legatee, or to his assignee; nor can they require that the rights of William Means’ creditors should be litigated in this suit. They are not parties, and tha.t subject could only be considered in independent litigation. Akin to that matter is the question presented in regard to the complainants’ trust being in part for the benefit of the grantor in the decid. Whether, as to creditors, that part of (lie trust would be obnoxious to their attack, we do not, for the reasons above stated, think it is necessary or proper to decide.
The result is that the descree of the court below must be reversed, and the cause; remanded, with directions to enter a decree for the complainants setting aside the; receipt of October 16, 1890, and directing an account to be taken for the purpose of ascertain