203 P.2d 156 | Kan. | 1949
The opinion of the court was delivered by
This was an action to recover damages for the alleged negligent transfer of corporate stock by the defendant. The defendant’s demurrer to the plaintiffs’ petition was sustained, and plaintiffs have appealed.
In the petition it was alleged that defendant is a corporation organized under the laws of Kansas; that plaintiffs’ father, Gustav J. Plamann, was the owner of three certificates for ten shares each of the capital stock of the defendant corporation; that he made his last will and testament, by the terms of which he bequeathed all of his property to his wife Cordelia to have during her natural life, with remainder over to the plaintiffs and their brother Ralph A. Plamann on the death of Cordelia. It was further alleged that on June 19, 1932, Gustav died and his will was duly admitted to probate in the probate court of Brown county on June 28, 1932, and on the same day letters testamentary were issued to Cordelia; that on the same day she filed her election to take under the will; that she inventoried the above stocks and other property, and duly administered the estate, and made application to the probate court for final settlement, and made final settlement on August 28, 1933; and that the records of the probate court show that no appeal was taken from the order of final settlement and no objection was made thereto. It was further alleged that the stock certificates were in the hands and under the control of Cordelia, executor, on August 28, 1933, and that by the terms of the will and by the terms of the order of final settlement, Cordelia became the owner of the stock certificates as a life tenant, the remainder interest being vested in the plaintiffs and their brother Ralph; that on some date unknown to plaintiffs Cordelia sold and assigned the stock certificates to divers persons, all without knowledge of plaintiffs and they did not know of such wrongful transfer sale and assignment until after the death of Cordelia; that she died August 19,1945, and plaintiffs became entitled
Defendant’s demurrer to the above petition on the ground that facts sufficient to constitute a cause of action were not stated, was sustained by the trial court and appeal to this court followed.
In support of the trial court’s ruling, appellee argues that the petition discloses that the transfer of the stock was compelled by legal proceedings and therefore it has no liability.
Appellants contend that the petition discloses that the transfer of the stock was made by an executor; that the appellee was therefore chargeable with notice there was a will and liable if it permitted a transfer in contravention of the terms of the will, in support of which they direct our attention to 12 Fletcher, Cyc. of Corporations (Perm, ed.) § 5549, to 18 C. J. S. [Corp. § 439(c)] p. 1069, and to decisions hereafter noted.
Generally, it is not necessary that we make an extended statement of the facts in the cases cited by appellants to show that they are not controlling here. In the following cases the stock was transferred without any court order directing the transfer: Marbury, Trustee, v. Ehlen, et al., 72 Md. 206, 19 Atl. 648; Wooten v. Railroad, 128 N. C. 119, 38 S. E. 298; Baker v. R. R., 173 N. C. 365, 92 S. E. 170, L. R. A. 1917E 266.
In Baker v. R. R., supra, a will bequeathed two shares of stock to John Baker and two shares to Jesse Baker, all rights to vest in the survivor, but if both died without issue, the remainder was to the next of kin. The executor surrendered the stock with request it be issued two shares each to John and to Jesse and that was done. Jesse died without issue and the four shares were then turned in and issued to a third person. Later John died without issue and the next of kin brought an action against the corporation and recovered, it being held that the corporation was charged with knowledge of the provisions of the will when the transfer was made by the executor when acting without an order of court to sell the stock.
In Seymour v. National Biscuit Co., 107 F. 2d 58, 126 A. L. R. 1288, the transfer was not in accord with the order of the court.
Appellants rely especially upon West v. American Tel. & Tel. Co., 54 Ohio App. 369, 7 N. E. 2d 805. The opinion is long and reference is made to it for details. The will of decedent gave his wife a life
From the above cases it may be deduced that a company which transfers stock standing in the name of a decedent, upon application of his executor or administrator, is without liability to the beneficiary where the company acts upon and follows out completely an order of a court of competent jurisdiction ordering the transfer to be made.
Under the allegations of the petition a final settlement of the estate of Gustav J. Plamann was made in August, 1933, at which time R. S. 1923, 22-904 and 906, later appearing as G. S. 1935, 22-904 and 906, were in effect. They provided that when an executor, wished to make final settlement, he should file his report, and publish notice of the date he intended to make final settlement, the statute providing the notice was to all creditors and others interested in the estate, and at the time fixed the probate court should hear the settlement and make a finding as to who were the heirs, legatees or devisees of the deceased, and record thereof should be made upon the journal of the court. The latter section provided that when it appeared notice had been duly published and the estate had been fully administered, the court should make final settlement. Other provisions of the then existing statute with respect to distribution of the assets of the estate need not be noted further than that appeals were allowed to the district court from the decision of the probate court on all settlements of executors, on all apportionments among creditors, legatees, or distributees, on all orders directing payment of legacies, and in all other cases where
The petition and attached documents show that a final settlement was filed, notice given, hearing thereon held and that an order was made “that the executor herein properly assign to Cordelia Plamann securities thus described” followed by description of many securities including those now involved, and that thereupon the executor was discharged and the estate closed. No one appealed from the orders above mentioned.
In Brown v. Schreckler, 151 Kan. 724, 100 P. 2d 741, it was held that final settlement of an estate made by the probate court pursuant to G. S. 1935, 22-904 and 22-906, was a final order binding upon all persons interested in the estate, unless appeal be taken, and that the order, if not appealed from, became final and conclusive as against collateral attack, except for fraud. In the later case of Cole v. Thacker, 158 Kan. 242, 146 P. 2d 665, it was held that a judgment of a probate court directing an executor to make distribution to a person entitled thereto cannot be collaterally attacked. Each of the above opinions cites others of like effect.
Appellants seek to avoid the effect of the last cited cases by contending that the order was that the stocks be “properly” assigned, and that the use of that adverb meant that the appellee in making the transfer was not only bound to take notice of the order but also of the terms of the will and, taking notice thereof, to issue the new certificates in such manner and form that each certificate disclosed on its face that Cordelia had only a life estate and the three children had the remainder. In our opinion such an interpretation is not correct. Had it been the intention of the probate court to make such an order as appellants contend, appropriate language so stating would have been used. The order was for assignment to Cordelia and no one else and the use of the word “properly” meant no more than that the assignment was to be suitable, fit, correct and right to accomplish transfer to her. The present appellants had notice of the order as made and took no appeal from it. It became final and they may not now attack it collaterlly and indirectly by’ contending it is subject to a construction at variance with its terms.