141 P. 661 | Mont. | 1914
delivered the opinion of the court.
On March 29, 1899, John M. Keith was duly appointed guardian of the persons and estates of Louise Anna Allard and Eva May Allard, minors, and immediately thereafter qualified. On December 16, 1912 — Eva May Allard having become of age —the guardian presented his final account of his administration of her estate, and prayed that he be discharged as her guardian. In his account the guardian charged himself with total receipts amounting to $26,443.77, and took credit for expenditures made on behalf of the ward, aggregating $18,332.66. Of the balance, he represented that he had loaned $7,500 to Louise Stringer, and asked that he be permitted to turn over the note and be credited with the amount of the principal; that he be allowed, out of the $611.11 remaining, such compensation for himself as the court might fix, $150 for his attorney’s fees; and that upon delivering the balance to the ward, together with the Stringer note duly indorsed, he be discharged. To this account, the ward interposed objections, and a hearing was ordered for December 28, but was continued to April 19, 1913, without being concluded. On April 19 the guardian filed an amended account in which he charged himself, as before,.with receipts aggregating $26,443.77, but took credit for expenditures aggregating $20,656.52, including, as items of his expenditures, $1,048.88, compensation for himself as guardian, and $750 for his attorney’s fees. In this amended account no mention whatever was made of the Stringer note or interest; but the amount of the principal was included in the total receipts, and a cash balance of $5,787.25 was admitted to be due to the ward. Written objections to this amended account having been made by the
The difference between the amount admitted by the guardian to be due to the ward and the balance found to be due by the lower court is made up by charging the guardian with $923‘.50, interest on the William Irvine note, $3,745, interest on the Stringer note, disallowing his claim for compensation as guardian, and reducing his attorney’s fees to $250. The four changes thus made in the amended account by the district court constitute the grounds of complaint presented by these appeals.
1. The first change made did not result in any prejudice to
2. On May 10, 1902, the guardian, without an order of court, loaned $7,500 of the moneys belonging to this ward, taking a
If we understand the contention of appellant aright, it is that, if the ward so far ratified the loan as to insist upon having the accumulated interest, she should be held to accept the note as representing both the principal and the interest due, or, if she refuses to accept the note in lieu of cash, she should be held to repudiate the loan altogether, and therefore to be without any claim to the interest. Whatever merit there might be in an argument of this character when advanced by one of two persons, both sui juris, and dealing at arm’s length, the relationship of guardian and ward is of such nature as to 'forbid the assertion of the doctrine for which the appellant contends. As guardian, it was his duty to “keep safely the property of his ward” (Rev. Codes, see. 3786), and to “manage the estate of his ward frugally” (see. 7771). Upon application of the ward or any other person interested, the district court might authorize or require the guardian to invest money belonging to his ward (sec. 7795), or, if the particular money was derived from the sale of other property of the ward for the express purpose of investment, then “the guardian must make the investment according to his best judgment, or in pursuance of any order that may be made by the court or judge.” (Sec. 7783.) Beyond these specific directions, the Codes do not go, except to declare that: ‘ ‘ The relation of a guardian and ward is confidential, and is subject to the provisions of the "title on trusts.” (See. 3787.)
Of the provisions of that same title on Trusts, section 5375 declares: “A trustee may not use or deal with the trust"property for his own benefit, or for any other purpose unconnected
We are not called upon at this time to determine whether
Neither are we required to determine whether if, in making
3. Appellant complains of the action of the trial court in
During the entire term of this guardianship the statute in force required every guardian to return to the court an
• The report filed by the guardian discloses that prior to May 20, 1902 — the date of the first loans of any of these funds — he had received moneys belonging to this ward, aggregating more than $20,000, and he testified that during the same period he received an equal amount belonging to Anna Louise Allard. He was their joint guardian, and all the funds were supposed to have been deposited in his name as guardian with the First National Bank of Missoula. According to his account and his testimony, he should have deposited prior to May 29, 1902, more than $40,000; but his guardian account at the bank discloses that he had actually deposited only $30,524.97. What he did with the balance is not revealed by this record. According to his report and his testimony, he should have had on deposit in his guardianship account at the bank on May 20, 1902, more than $40,000; whereas, his bank account shows a balance in his favor on that day of only $596.12. His account in the bank, from the date of his appointment to the date of these first loans, reads as follows:
Mar. 30 (1899) 18,333.32
Apr. 6 12,650.00 5,683.32
Aug. 30 5,000.00 683.32
Jan. 18 (1900) Hayes 5,000.00 5,683.32
29 5,350.00 333.32
Feb. 1 30.25 303.07
13 178.00 125.07
May 26 6,666.66 6,791.73
31 6,500.00 291.13
May 22 (1901) 122.75 168.98
Oct. 14 146.66 315.64
Dec. 18 85.60 230.04
23 300.00 530.04
Feb. 27 (1902) 78.83 608.37
Mar. 7 13.25 595.12
When asked to explain these large withdrawals of $12,650, $5,000, $5,350, and $6,500, all within little more than a year from the date of his appointment, and to tell to whom the checks were given, and for what purposes, he was reduced to the miserable expedient of saying, “I cannot tell you; I do not know.” The money was not loaned, and there was not any pretense that it was used for any purpose connected with the business of either ward. On that day he had expended for this ward but $125.32, according to his own report. We have, then, laid bare by the account of this guardian and his own testimony the fact that within little more than a year after his appointment he had withdrawn from his account as guardian of these minors $30,000 in round numbers, and yet he is unable to say for what purpose the money was used, and was unable to present any vouchers for it. The fact that this money was all accounted for in the final report does not even suggest a justification for such mismanagement. The guardian further testified:
“Q. Part of the time you carried this account in your own individual name at the First National Bank of Missoula? A. Part of it went into my individual account; there was no effort*228 made to keep a strict guardian’s account, a bank account, none whatever.
‘ ‘ Q. When you carried this account of Eva and Anna, carried it in your own individual name, why you mingled it, of course, with your own fund? A. Yes, sir.
“Q. Do you know how long you carried this account of guardian in your own name, individually, in the bank? A. I could not tell. * * *
“Q. Why did you credit your own individual account with any funds belonging to Eva May Allard, a minor ? A. Because it was immaterial where I carried it if I accounted for the funds.
“Q. Haven’t you any reason to give the court at this time why you would make any transfer from your account as guarddian? A. None whatever.”
We refrain from further criticism of appellant, for it may be that the position assumed by this court in In re Ricker’s Estate, 14 Mont. 153, 29 L. R. A. 622, 35 Pac. 960, served to lull him and his counsel into a sense of security, or misled them altogether as to the rule of conduct thereafter to be observed in this state in the management of trust funds. We repudiate the doctrine of that case as unwholesome from a moral standpoint, and as erroneous as a statement of the law. A guardian or
If this appellant had been dealing with his oiyn property, he would not be expected to remember the purpose for which he gave a particular check ten or twelve years before; but the answer, “I do not know,” has no place in the response of one who deals with trust funds. It is his business to know, and, to the end that he may be able to answer intelligently, he is forbidden to mingle the trust funds with his own, and is required to keep a just and true account which will disclose at all times the source of every item of income and the purpose of every item of expense. Appellant may deem himself fortunate that, in addition to the forfeiture of his compensation, the district court did not charge him with interest on the funds withdrawn from the guardian’s account, and for which he offered no satisfactory explanation, indeed, no explanation at all.
4. Fault is found with the action of the trial court in fixing
The order of the district court correcting and allowing the guardian’s final report, and directing payment to the ward, is affirmed; as is also the order denying appellant a new trial.
Affirmed.