Palmer v. Noyes

| N.H. | Jun 15, 1864

Sargent, J.

It is suggested in the brief of the trustees’ counsel, that the service of the writ may not be sufficient in this case to warrant any judgment against the principal defendant. But no such question is raised in the case, or has been considered by us.

The objection, also, that the action was prematurely brought, cannot avail. It matters not, whether the estate of which the trustees were executors was so far settled as to make it certain whether the trustees would be chargeable or not when the writ was served. If, at the time of the disclosure, there proves to be anything due, that is sufficient. If the disclosure had been taken before the executors had settled the estate, and before they had been charged with any balance, as due to the principal defendant, they must, of course, have been discharged upon such disclosure. But the trustee will be charged or discharged, according as the facts exist at the time of the disclosure, and not at the time of the service of the writ.

It is common in our practice to summon individuals as trustees, where it is uncertain whether they will in the end be chargeable or not, and where, as the facts exist at the time of the service, they could not be charged, and to have the action continued until such time'as the liability of the trustee to the principal defendant is determined, and then to take his disclosure, and if chargeable hold the amount thus due upon the trustee process.

Neither is the objection that executors are not liable as trustees in any case well taken. Under the general laws of Massachusetts, Maine and Connecticut, it seems to have been held that executors were not liable as trustees; but special acts were soon passed making them liable in those States, the same as other individuals holding funds that belong to, the principal defendant. But the general statutes in Massachusetts, and, we presume, in the other States mentioned, were essentially different from ours. There, the law only authorized the attachment in the hands of the trustee of the "goods, effects and credits” of the principal debtor, "entrusted and deposited in the hands of a stranger,” and it was held that these terms did not apply to money in the hands of an executor. Barnes v. Treat & Tr., 7 Mass. 271" court="Mass." date_filed="1811-03-15" href="https://app.midpage.ai/document/barnes-v-treat-6403655?utm_source=webapp" opinion_id="6403655">7 Mass. 271: Brooks v. Cook & Tr., 8 Mass. 246" court="Mass." date_filed="1811-10-15" href="https://app.midpage.ai/document/brooks-v-cook-6403773?utm_source=webapp" opinion_id="6403773">8 Mass. 246.

But the terms of our statute authorizing the attachment of the goods, chattels, rights, and credits, in the hands and possession of the trustee, belonging to the principal defendant, is evidently broad enough to cover this case, and as our statute in this particular has remained unchanged since 1791, (see N. H. Laws of 1815 and 1830,) there has been' no occasion here for any special acts making executors liable as trustees, as there was in other States, where their general statute was more limited than ours. Adams v. Barrett, 2 N. H. 374; Davis v. Drew, 6 N. H. 399.

It is said in Beckwith v. Baxter & Tr., 3 N. H. 67, that an executor cannot be held as the trustee of one to whom a pecuniary legacy is bequeathed by the will of the testator. But this is stated solely upon the authority of the Massachusetts decisions, without noticing the difference in the statutes of the two States. But the case was decided upon another ground mainly, and this decision has never been relied on as an authority that executors cannot be charged as trustees under our statute.

It is also objected that the amount in the hands of the trustees, which is claimed as belonging to the principal defendant was placed there as a trust fund” by the executrix, and that the executors are thus made the trustees for the defendant, by the will, in such a way that they cannot be holden by the trustee process. There is no doubt that such a bequest might be made. Executors may have duties assigned them which may constitute them trustees to all intents and purposes, without their being named as such, and when a trust fund is created in the hands of trustees for the benefit of a cestui que trust, the present legal estate is usually vested in the trustee, and he is to expend the income, or the principal, or both, in a particular manner, or to apply it at his own discretion, for the benefit of the cestui que trust, in which case, ordinarily, the trustee would not be liable upon the trustee process. Carson v. Carson & Tr. 6 Allen, 397.

But in this case the executors have no discretionary powers. They are not made the trustees of the defendant by the will, but the property, whatever shall be left for the principal defendant, is given to him, his heirs and assigns forever, and the same is to be paid in ten equal parts, annually, by the executors. They having paid debts and legacies, and settled their account with the judge of probate, and the amount having been thus fixed and settled, which they held for the defendant, they have no discretion to exercise and are at liberty to exercise none, but are to pay over this sum according to the provisions of the will. Some part of the sum was due and owing at the time of the disclosure, and more will become due each year. The trustees are, therefore, chargeable upon their disclosure.

The plaintiff claims that the trustees should be now charged for the whole amount of their indebtedness, both present and prospective, to the principal defendant; that this judgment would transfer all the defendant’s rights to the plaintiff, so that he would be entitled to receive of the trustees the several amounts as they become due, and when it was all due he might have an execution for the whole, the court staying execution upon the judgment until that time. And it is urged that the plaintiff ought not to be obliged to wait for his judgment until the whole becomes due, since the principal defendant may die, and if that should happen before judgment, and his estate be administered as insolvent, this money in the hands of the trustees would be thrown into a common fund for the benefit of all his creditors, and the plaintiff would lose his lien upon the same.

That would undoubtedly be so. But upon the same supposition of defendant’s death and insolvency, how would it be if the plaintiff should now have his judgment against the trustees for the whole sum now due, and hereafter to become due? In such case, the plaintiff would not only get all that would have been paid to the defendant in his life time, but all that would otherwise have remained in the trustees’ hands at his decease, and which in such case should go for the equal benefit of all his creditors. So that there would be greater danger in case of defendant’s death, that the plaintiff would get more than belonged to him, by giving him judgment now for the whole amount, than there would be of his losing any of- his rights by the other course, because the plaintiff is not obliged to wait and run any such risk of losing his lien upon the money in the hands of the trustees, because he may have judgment and execution now for the amount due at the time of the disclosure, or for the amount that shall be due according to the terms of the disclosure at the date of the judgment. But he cannot have judgment for any thing not due at the time the judgment is made up. The judgment is that the trustees are chargeable, and they will be chargeable for the amount due at the time the plaintiff has his judgment made up. This is provided for in sec. 10, chap. 208, Rev. Stat’s. : "Whenthe trasteéis indebted to the principal defendant, and the term of payment has not expired, the court may suspend issuing execution against such trustee, as justice may require.”

So, in the case before us, the trustees appear to be indebted to the principal defendant to a certain amount, a portion of which is not due, but portions of which will become due from year to year, for many years to come. Now, if the plaintiff shows that justice requires that his case be continued from term to term, until the whole amount of his claim becomes due to the principal defendant, the court may, no doubt, grant him such continuances, and thus suspend the issuing of execution until that time, and thus give the plaintiff the benefit of the whole sum to be paid the defendant by the trustees. But the plaintiff must run his risk of the death and insolvency of the principal defendant in the mean time, by which his suit against the defendant would abate, and he would be obliged to prove his claim against his estate before a commissioner, and the amount in the trustees’ hands would thus become assets in the hands of an administrator, for the payment of all debts alike, against the principal defendant.

But the plaintiff is not compelled to take this course unless he chooses. He may take his judgment and execution at the next term after his disclosure, or at the same term, but all that his judgment can properly bemade up or that execution can issue for, will be the amount due at the time of the judgment.

The trustees are therefore chargeable for such sum as shall be due at the time when plaintiff has his judgment made up. The ruling of the court was correct.

Exceptions overruled.