12 Mills Surr. 260 | N.Y. Sur. Ct. | 1914
The executors in their account have charged themselves with $é,250, the balance remaining due upon a bond secured by a second mortgage which they found among their decedent’s assets. The lien of the mortgage was extinguished by the foreclosure of the prior mortgage, about a year and a half after the executors received their letters testamentary.
In objections filed to the account and in proceedings to revoke the letters of the accountants both as executors of the will and as guardians of the infant beneficiaries thereunder, it is claimed that the executors, in their treatment of the bond and mortgage which came into their hands, have inflicted injury upon the estate to an amount with which they should be surcharged in the settlement of the pending account and were guilty of mismanagement for which they should be deposed both as executors and guardians.
Strictly, they stand charged with the face value of the security and are in form chargeable further with interest thereon accrued and uncollected.
The resulting question is whether they are to remain charge
Except to receive $250 on account of the original principal of the investment and $262.50, interest thereon, the accountants have done nothing to enforce collection, and their inaction is negligence unless it shall be found' that the security was wholly without value and that it was the part of prudence to expend nothing of labor"or expense upon it.
The presumption is that the mortgage was worth its face value during the times when the executors were confronted by the duty of determining their treatment of it, and they lie under the burden of proof as to whether at these times the. loss of the investment or any part of it was the result of its own worthlessness.
Practically, then, the accountants can have no relief from the charge against them for the value of the security unless the proof justifies a finding that as to the whole or some part of the mortgage debt the mortgaged premises were inadequate to secure repayment and that the bondsman for whose obligation the mortgage was given was irresponsible. Harrington v. Keteltas, 92 N. Y. 40; O’Connor v. Gifford, 117 id. 275; Matter of Hosford, 27 App. Div. 427.
There is no evidence as to the resources of the bondsman, none which would warrant any finding that the mortgaged property was worth less than its incumbrances. The amount at which the premises were purchased by the plaintiff in the foreclosure affords no basis for a conclusion as to their value during any part of the year and a half preceding the purchase, nor should a finding-be based upon a statement of the assessed value of the property.
Beyond these intimations there is no proof upon the value of the investment. While in common opinion the surety on a bond given with a mortgage is negligible, the law will not, in the
The surrogate is not asked to apply the rule of the cases cited, that the executor must answer for the face value of the causes of action or security which comes to him from his decedent unless he makes proof of its lack of value. He is advised by counsel for the objectants and by the special guardian that the injury to the estate by reason of the executors’ inaction respecting the mortgage is $2,500. Their estimate is accepted, and the executors will, therefore, be allowed credit for $1,750.
The conduct of the accountants as to this mortgage was mismanagement and waste. It has impaired the estate and shows their unfitness for the office of executors.
The same finding must be made as to their guardianship. They were executors under a will which left the whole estate to three children and under the same will they were the guardians of the estate of these children. Whatever was their duty or default in their executorial capacity entered into their conduct and responsibility as guardians.
Letters testamentary and the letters of guardianship must be revoked and the account will be settled in accordance with the preceding suggestion.
Decreed accordingly»
