11 Gratt. 111 | Va. | 1854
Lead Opinion
Nathaniel Thompson, as guardian, was in possession of Winston’s bond, as part of the estate of George Pottie his ward. Whatever interest the ward had therein was subject to the guardian’s control ; he might have received the money due thereon if voluntarily paid; he might have sued for it in a common law court in the name of John Thompson, executor of George Pottie the obligee, but for his own use as guardian; and the nominal plaintiff would have had ho power to prevent the prosecution of the suit, or to prevent the collection of the money for the use of the guardian; or he might have sold and transferred the bond. But in any exercise of his authority the guardian must, at his peril, have acted with proper discretion, in reference to the ward’s interest. It is for the benefit of the ward himself that the guardian should, if possible, be regarded as having the legal title to the ward’s personal estate. That title may be essential to the protection of the property itself; the guardian is responsible for its safe keeping, and it
The interest of the ward requires that his guardian should have the power to sell his personal estate. Under certain circumstances, readily conceived, an immediate expenditure of money might be indispensable to protect the estate against loss ; the guardian might find that the best mode, or only mode, of raising the money, was by a sale of bonds belonging to the ward’s estate. Under such circumstances, a delay for collection might be injurious or even ruinous to the ward’s fortune. It is no valid objection to allowing the guardian this power, to say, it may be abused': Every power, however -necessary, may be abused. The objection would apply to every case in which one party is entrusted with the property of another. This power is justified by the reason and fitness of things, and is moreover well sustained by authority.
In Truss v. Old, 6 Rand. 556, Judge Green, speak
In Bank of Virginia v. Craig, 6 Leigh 399, 426, Judge Carr says, “ The power and legal title of Fox (the guardian) to dispose of the stock (the ward’s property,) is proved by many cases.” And in this opinion Judges Brockenbrough and Cabell concurred. In the same case, p. 428, Judge Tucker says, “It is conceded also, that, as a general rule, a guardian has power to dispose of the personal estate of his ward; and though personally responsible for so doing, the vendee to whom he sells is not responsible if he has dealt fairly and justly, and without notice of any fraudulent intent.”
In Field v. Schieffelin, 7 John. Ch. R. 150, Chancellor Kent considers the question of a guardian’s power to sell his ward’s personal estate; and comes to a like conclusion with our own courts.
Holding then on the general question, that the guardian in this case had the power to sell, the question recurs, did he exercise his power within the limits and for the purposes prescribed by law ? The answer is plain, that he did not; he used his power for his own individual benefit, by appropriating the ward’s property to pay his (the guardian’s) own debt. This was a breach of trust, a fraud upon his ward. So far as the case of the appellees depends upon the conduct of Thompson the guardian, it is fully made out.
A recovery, however, cannot be had against Hunter,
George Pottie the ward, and Hunter the purchaser for value without notice, are the victims of Thompson’s fraud; and in' settling the question of loss between them the court should proceed upon the general principles of equity. If the equities be equal, the court will not interfere; or if one party have the advantage at law, equity will not interfere to deprive him of that advantage, unless in favor of a party having superior equity. Trying the case by these tests, we must hold that Hunter’s equity is equal to that of George Pottie; a purchaser for value, without notice of fraud in his vendor, stands upon as high ground in equity, as any creditor, or cestui que trust.
Again. Thompson’s transfer to Hunter gave him the power at -law to receive the money if paid by Winston, and to give him a valid discharge ; or to sue for it in a common law court in the name of Thompson the executor, for his own use, and to recover it without the possibility of interference by the nominal plaintiff or any other party. Although Hunter may not have had the legal title to the debt, yet such were his rights and powers at law. In the exercise of his right he has received the money, and thereby acquitted Winston of all further liability therefor. To hold him responsible to George Pottie, we must deprive him of the advantage given by his legal power and right. To arrive at such a result, we must overturn all the decisions of the courts upon cases of the same or like kind.
In Broadus v. Rosson, 3 Leigh 12, the parties dealing with the guardian were fully aware of his breach of trust, and actively co-operated with him therein for their own benefit; and for that reason were held liable.
In Fisher v. Bassett, 9 Leigh 119, a party knowingly dealing with an administrator, who in breach of his trust was applying the assets of the estate to his own use, was held responsible.
In Pinckard v. Woods, 8 Gratt. 140, a party, for his own profit, knowingly dealing with an executor in such way as to enable the executor to commit a devastavit, was made liable.
In each of these cases, and in many if not all others of like kind, the party dealing with the fiduciary has been held responsible, because and only because of his co-operation in the fraud. In our case this ruling fact does not exist. I am therefore of opinion that George Pottie had no right to draw Hunter in question for his dealing with Thompson the guardian.
If George Pottie had no right to recover of Hunter, the appellees, claiming to be substituted to his rights, can have no right to recover. If, however, the case were otherwise between Pottie and Hunter, still, under the circumstances' of this case, the appellees should not be permitted to subject the appellant to any liability. The intestates of the appellees respectively bound themselves by bond as securities for Thompson as guardian; and in 1825, when this bond ■ was in full force, their principal committed the breach of its condition which is complained of in this suit. At that time the securities might have guarded themselves against all loss by using a small degree of diligence. They owed it to themselves and to the ward, to see that the guardian, who obtained possession of the ward’s estate by means of their credit, faithfully performed his trust; they should at least have taken care, when the ward attained full age, that the guar
I am of opinion to reverse the decree and dismiss the bill, with costs of both courts to the appellant.
Daniel and Lee, Js. concurred in the opinion of Samuels, J.
Concurrence Opinion
concurred in reversing the decree and dismissing the bill upon the last grounds stated in the opinion of Samuels, J., without dissenting from the first grounds stated by him.
.Allen, J. concurred on the last grounds stated by Samuels, J.
Decree reversed and bill dismissed.