186 A.D. 161 | N.Y. App. Div. | 1919
Andrew Donnelly, Jr., died September 23, 1906. Five days later letters of administration were issued to the respondent. The intestate left a widow and a daughter five or six years old who is the appellant herein and his only next of kin. No accounting having been had, in July, 1913, the widow instituted a proceeding to compel the administrator to account. He thereupon filed his account, to which objections were filed by the widow and guardian of the infant. After a contest in Surrogate’s Court a decree was entered December 19, 1914, from which an appeal has been taken in behalf of the infant. There is no appeal by the widow who has since died. The controversy on this appeal relates only to the rights of the administrator and the infant.
The personal estate of the intestate amounted to $10,812.13, consisting almost entirely of the proceeds of life insurance which came into the hands of the administrator about a month after the death of the intestate. The administrator credits himself in his account with payments of debts and funeral and testamentary expenses amounting to $11,026.22, leaving the estate in debt to himself. The account was adjusted by the surrogate as filed. There are unpaid debts as fixed by the surrogate amounting to $1,001.14.
The principal objection to the account was the alleged payment by the administrator of a note of $6,000 to the widow, Frances Donnelly. This note was executed by the intestate about six months before his death. It was payable on demand and recited on its face that it was given “ as compensation for her faithful service and attendance during her married life.” Assuming that such a note is enforcible it is only
A careful scrutiny of the evidence convinces us that the note never had any legal inception, and in reaching this conclusion we do not question the veracity of the administrator, between whose testimony and that of the widow there is a wide divergence, but we accept his testimony and doing so we are still led to the conclusion indicated. The administrator testifies that as attorney for the intestate he drew the note in his sick room and that it was given to Mrs. Donnelly. This she denies. He does not testify that she was present when the note was signed or during any part of the transaction which resulted in its execution. None of the conversation appears in evidence and there is no explanation of the situation which caused the note to be executed. Not a word of explanation
We think, moreover, that the $4,000 contract had no relation to the note and was not made on the faith thereof. The testimony of the administrator as to the making of this contract indicates clearly that the note was not in the mind of either party as the basis for that contract. It was made two or three days after the death of the intestate and is narrated by the administrator as follows: “ She wanted me to be administrator of the estate and I declined to act and told her that if there was going to be trouble that it would probably be in Rockland County, a large share of it, and that the commissions that the law allowed any administrator would not be
We may, however, go further and hold that even if the note was a valid obligation in favor of the widow and if it was understood that the administrator was to be paid $4,000 out of this note he is not "in a position to enforce that contract. The question is not complicated as it might be if he had performed valuable services on the strength of such a contract. The record shows clearly that the administrator performed neither for the estate nor for the widow any substantial services except such as administrator he was bound to perform. Litigation was anticipated and that was the foundation for making the $4,000 contract between the administrator and the widow. The threatened litigation developed and resulted in judgments against the estate aggregating something over $3,000 with which the administrator is credited in his account. But he employed other attorneys to conduct that litigation and they have presented bills therefor payable
It is also to be observed that the proposition of Mrs. Donnelly as stated by the administrator and which he accepted was as follows: “ I will give you $4,000 for this if you will take care of me and my little girl and keep those Haverstraw people from getting the property away from us.” The fair meaning of this was that the $4,000 was to save the estate harmless from all claims of the “ Haverstraw people.” It was not a proposition to pay him $4,000 irrespective of results. The $4,000 was not earned unless those claims were defeated or if they had been established for less than that amount the administrator probably would have been entitled to the difference after paying the expenses of the litigation.
On November 12, 1906, the administrator used $6,000 of the funds of the estate then in the bank to his credit as such administrator to take to himself as administrator an assignment of a purchase-money bond and mortgage for that amount which two years before he had executed on a farm and for the payment of which he was personally liable and which was then overdue. The bank account shows him charged with that amount on that day. Of course this necessarily included the $4,000 which he claimed to own by virtue of his contract with the widow. In the following March the account in the bank was closed and has never been reopened. On October 3, 1911, the farm was sold to another party, the administrator satisfied the mortgage against himself, took back to himself personally another mortgage for the sum of $7,000 which he subsequently foreclosed and now owns the farm. Some portions of said $6,000 were subsequently paid for the benefit of the estate as necessity required. But, as stated, the administrator has always claimed to own personally $4,000 of the funds of the estate which we are constrained to hold he did not own and that portion of the estate went into the said investment. Ordinarily of course an administrator is not supposed to invest the funds of an estate and derive interest therefrom. His duties imply too speedy a settlement and distribution of the funds to make investments. But here settlement of the estate has been delayed for many years, during all of which time a large portion thereof has been invested. The investment was made by the administrator. He testifies to it. He has never made concealment of it. His position is that the greater part of the investment was his because of his contract with the widow and that such investment, therefore, inures to his personal advantage. His premise being wrong, his conclusion is wrong and it is beyond argument
The account of the administrator must be surcharged. ■ As between him and the infant a statement of the account as favorable to him as the circumstances permit is as follows: He charges himself in his account with $10,812.13; all of the credits claimed by him, including his commissions and the allowances made by the surrogate on the accounting, but excluding the $6,000 note, are $5,411.42; in addition he may be credited with payments to the widow of $1,820, which fully covered her distributive share in the estate; leaving a balance in his hands not accounted for of $3,580.71 which amount with interest thereon from November 12, 1906, to the present time he should pay to the general guardian of the infant, except that he should retain therefrom and pay the unpaid bills specified in the decree amounting to $1,001.14 besides interest thereon from the date of the decree.
The decree should be modified in accordance with this opinion and as so modified affirmed, without costs to either party as against the other. The court disapproves the third, seventh and eighth findings of fact of the surrogate, and finds as facts that the $6,000 note was without consideration and was not delivered to the widow or accepted by her and that the $4,000 contract was not made on the faith of the note and had no relation thereto.
Decree modified in accordance with opinion, and as so modified unanimously affirmed, without costs to either party as against the other. The court disapproves of the third, seventh and eighth findings of fact of the surrogate, and finds as facts that the $6,000 note was without consideration and was not delivered to the widow or accepted by her and that the $4,000 contract was not made on the faith of the note and had no relation thereto.