Postlewait v. Howes, 3 Iowa 365

Postlewait v. Howes

3 Iowa 365 | Iowa | 1856

'Wright, C. J.

To reverse the decree below in favor of the complainant, Keeler, and to sustain so much of it as dismissed the bill as to the other complainants, the respondents have urged various grounds, which we proceed briefly to notice. The first in order is the objection, that the administrator of the estate of Robert G. is not made a party to the bill. Complainants admit substantially, that under ordinary circumstances, the administrator should be joined in bills of this character. It is urged, however, by them, first, that in this instance, there was no such personal representative; and second, that the objection comes too late.

There is nothing in the bill in express terms, negativing the fact that there is such administrator. On this subject nothing is said. The law contemplates the appointment of such administrator, in all cases when the intestate dies within the state, or where he shall die anon-resident of the state, having property to be administered upon within the county, “ or where such property is afterwards brought into the county.” In the absence of such averment, or showing to the contrary, we cannot presume that administration has not been granted. But it is said, that the non appointment of an administrator is shown from the fact, that decedent is averred to have had no property within the state, and'from the further fact, that he was a non-resident at the time of his death. The bill does not disclose when Anderson died. The proof shows that he died in California, but for anything that appears, his family was at the time within this state, and he, in legal contemplation, a resident of it. Penley v. Waterhouse, 1 Iowa, 498 ; Hinds v. Hinds, 1 Ib. 36. But if we should even grant that the non-residence and want of a legal interest in property, was sufficiently shown, we cannot think the practice regular or safe, to proceed in *378cases of this character, without having an administrator ap - pointed. It is the duty of an administrator to protect and guard the interest of the estate, and to see that claims are only paid in the due and regular course of administration. The personal estate is primarily liable for the payment of debts, and the real estate can only be reached, in the event that the personal effects are inadequate to satisfy the debts and charges. It is his duty to collect such personal assets, and to defend against any claims which may not be a just charge against the estate. The widow, or heir, as such, have no such duties devolving upon them. The administrator becomes the personal representative of the deceased, stands in his place and stead, and no judgment can properly be taken for a claim against an estate, until such administration. To seek to subject the real estate, whether legal or equitable, of the heir, in the first instance, to the payment of a claim against the decedent, would certainly be novel and subversive of the whole policy of the law, regulating the settlement of estates. May and Andor v. Heirs of Reynolds, June T. 1854. If a proceeding should, therefore, be instituted, in which it becomes material to ascertain the condition of the assets of the estate, or in which a complainant seeks to make his claim chargeable on the real estate in the hands of the widow or heirs, and no administrator has been appointed, the cause should be continued, to give an opportunity for such an appointment, which appointment, un der the law, may be made, either at the instance of the creditors or those adversely interested. We conclude, therefore, that there is no sufficient reason shown by the bill or proof, for not making the administrator a party. The remaining question on this part of the case is, whether the objection comes too late ?

Courts of equity aim to do complete justice, and not to do it by halves. To accomplish this, it is eminently necessary that the bill should bring before the court, all proper and necessary parties. The rights of no one should be finally decided in a legal or equitable tribunal, until he has an opportunity to appear and maintain or vindicate his right; and to enable a court of equity to do complete justice in every case, *379it reasonably and even necessarily follows, that where a decision is made upon any particular subject matter, “the rights of all persons whose interests are immediately connected with that decision, and affected by it, shall be- provided for as far as they reasonably may be.” If it shall appear by the bill, that a proper party is not so before the court, as to afford him an opportunity to be heard, the usual method is to demur, or to make the objection by plea or answer. And if his non-joinder cannot prejudice the rights of the parties before the chancellor, the objection should be made by demurrer, plea, or answer, and will not be fatal, if urged for the first time on the hearing. But if it appears that the rights of those who are made parties, may be prejudiced by such nonjoinder, or that there may be a failure tómete out complete justice, the objection may be made on the hearing, or the chancellor himself may state the objection, and refuse to proceed to make a decree ; and in this respect, the proceedings in courts of law and equity present a most striking difference. At law, as a general rule, only persons directly and immediately interested in the subject matter, and whose interests are of a legal nature, need be made parties. In courts of equity, however, the general rule is as stated by Lord Hardwick, that all persons ought to be made parties who are necessary to make the determination complete, and quiet the question. Poor v. Clarke, 2 Atk. 515 Story’s Equity Pleadings, §§ 74 a, 75, 76, 76 a, 237, 541; 1 Daniell’s Ch. Pleadings and Practice, 295, 330; 2 Story’s Equity Jurisprudence, § 1526.

The question remains then, whether it is necessary to make the administrator a party in such a proceeding as the one before us, in order to prevent prejudice to other parties — mete out complete justice — and quiet the question in controversy j and much that we have already said is applicable to this inquiry.

Would not the ancestor, if living, be a necessary party? To this question, there can be but one answer. Why is he necessary ? One reason, not to name others, is, that he may have an opportunity to show that the judgments have been *380paid, or that he is solvent; for in either event, the alleged creditors have no right to inquire into any alleged fraud connected with the sale of the property. He alone is presumed to be able to show these facts, or to have in his possession, and under his control, the required evidence. If then he would be a necessary party, why not his administrator, who becomes his representative, and who is by the law intrusted with the duty of settling the estate. He is presumed to know whether the debt is paid, or whether the estate is solvent, and should have an opportunity to be heard. If the debt is paid, or the estate solvent, the proceedings would of course fail. But in addition to this, the administrator is the trustee for all of the creditors, and it is his duty to protect the property for their common benefit, as well as to preserve and hold for the heirs, what may remain after all debts are satisfied. How are .the rights of other creditors to be protected, if the grantee alone is made a party, as in this case ? They have no opportunity to be heard, even through the administrator, the common trustee.

We have found no case, in which the administrator has been held not to be a necessary party. On the contrary, the books abound in cases in which the necessity of making him a party is recognized. 1 Daniell’s Ch. Pl. & Pr. 330; Story’s Eq. Pleadings, §§ 170 to 173; McDowell v. Cochran, 11 Ill. 31; Thompson v. Brown, 4 Johns. Ch. 619; Bank U. S. v. Ritchie et al., 8 Peters, 128 ; Lawrence v. Trustees, &c., 2 Denio, 577 ; Wise v. Smith, 4 Gill & Johns. 297 ; Sweney et al. v. Ferguson, 2 Blackf. 129. And this rule finds strong support from the following sections of the Code, 1918, 1367, 1369, 1436.

The administrator should have been made party, and the objection may be made on the hearing. For this reason, the decree below in favor of Keeler, is erroneous, and as a consequence, correct so far as it denies relief to the other complainants. Where,'however, the objection is made for the first time on the hearing, we are unwilling to recognize the rule, that such want of proper parties shall operate to dismiss the bill. The better practice is to remand the cause, with leave to complainant to bring in the necessary parties. This *381practice has been recognized by this court. Kriechbaum v. Bridges & Powers, 1 Iowa, 14; and will be found to be sustained by authority. Story’s Equity Pleadings, §§ 239, 541.

This view of the first question, must result in reversing the cause, and remanding it for further proceedings; and ordinarily we should not examine other points made by counsel. As many of them may arise, however, in a subsequent trial, we deem it proper to dispose of those which seem to be most important. It is urged by respondent, that the judgments in favor of Keeler, were recovered for the use of Shornberger, and that Keeler has, therefore, no right to prosecute this action. The bill, however, charges that the said judgments are now the property of the complainant. This is sufficient to show him to be the party in interest, and being such party, he properly brings this suit.

It is next urged, that the administrators of the other deceased partners are not made parties, and that it should be shown that there are no partnership assets, before the creditors can seek to reach an equitable interest in the individual property of one of the partners. All of the judgments, except one, are against Robert Gr. Anderson alone. The complainants had a right to such judgments. It was at their option to proceed either against the surviving partner, or against the representatives of the deceased partners. And having elected to take judgments against the surviving partner, they have the further right to seek to make such judgments from his individual property; and the administrators of such other partners need not be made parties. Story on Part. § 362, note 3, and Nelson v. Hill, 5 How. 133. One of the judgments, however, in favor of Keeler, appears to have been rendered against James, as well as Robert G. Anderson. If he is dead (which is left indefinite by the bill), we think his administrator, for reasons already stated, should be made a party; and it ought also to be shown, that his estate is insolvent, and that there are no partnership assets from which to make such judgments.

It is further claimed, that the respondent is entitled to *382dower in this property, and that her right in this respect, should be protected in this proceeding. At present, it is perhaps sufficient to say, that she makes no such claim by her answer, nor has she otherwise preferred or asked it; nor has any assignment of it been made. Under such circumstances, should she even be entitled to dower in this property, such claim unpreferred and unassigned, could no.t defeat the right of the creditors to subject to sale the interest of the husband therein. Claussern v. La Franz, 1 Iowa, 227.

Eespondents further urge, that a portion, if not all, the judgments of complainants are dormant, and that as executions could not issue thereon, until revived by scirefacias, they have no right at this time to proceed in equity to subject property to satisfy the same. We think, however, that the ability or right, or want of ability or right, to issue execution, is not the test by which to determine whether a judgment creditor has a- right to file such a bill. Though the Code (§§. 1886, 1887), as well as the statute of 1813, 178, requires that judgments, on which executions have not issued within five years from the date of their rendition, shall be revived by scirefacias, before a party can have execution to enforce their collection, yetsuchjudgmentsinfact, remain and continue in full force and virtue.. They continue to be liens on.the real estate of defendant for ten years, and the statute of limitations could not be successfully pleaded to any action brought on the same, until after the lapse of twenty years from their rendition. Laws of 1816, 33; Code, § 2189. It is not strictly true, therefore, to say that these judgments were dormant at the time of filing this bill. There may have been no right to issue execution, but for all other purposes, they continued in full-life and had legal existence. And it is proper to bear in mind, that the jurisdiction in such cases, is exercised, not to aid legal process, but independent of, and without reference to, such process. The object is to remove an obstacle, which it is alleged is fraudulently interposed to prevent the collection of these judgments. As such creditors, they have a right to ask its removal, though when removed, they should even be turned over to their proper in*383dependent legal remedy, to obtain- tbe process of tbe law to make the sale. The case of Hagan v. Walker et al., 14 How. 29, and Burrough v. Elton, 11 Vesey, 28, are directly in point, and clearly recognize the-doctrine, that a judgment creditor-may thus proceed in equity, though he might afterwards be required before obtaining execution, to-revive his judgment; by scire facias.

Another objection, and the one perhaps most strongly pressed, is, that complainants, have not; exhausted their-legal remedy, by having execution issued and returned nulla bona, and that until, this has .been, done, they have do right.to-ask equitable aid. On the part of respondents,..it: is claimed to be the settled law,, that, the return of an execution.unsatisfied-is necessary, before the chancellor; has, jurisdiction of a bill of this character; that the insolvency of the debtor must-be first-shown ; and that this cannot be done -in: any other-way than by a return of nulla bona. Complainants, on the other hand, insist that the jurisdiction is not.determined, alone by such return of no property, found,, but that .-if’it can be-otherwise shown, that there is no other property, and that the issuing of an execution would be unavailing, the-right to follow the-equitable estate, is .as complete -and perfect; as. after a return of nulla bona. But if this is not true, he, in the second place, insists that such return is .not. necessary, where-the proceed-ing is against a decedent’s estate.. Aside from the adjudicated cases, we strongly incline to the opinion, that the first-position of complainants is in, accordance with reason and common sense. If the creditor shall charge in his.bill, and prove on the hearing, that the debtor is in fact insolvent, and that an execution, if issued, must necess.arily.-be returned.unsatisfied, we see no -reason for requiring, him to go through-the fruitless form of exhausting his legal remedy, by return-of execution, no property found. Under such circumstances, there is.no legal remedy to exhaust,.for he shows that he hasnpne. It is true that such returns of nulla bona, may in legal contemplation, be the most satisfactory method of establishing, the fact of insolvency, but practically.it would be scarcely-more conclusive, or convincing to the-mind of the-chancellor, *384than if proved by other means or in other ways. And yet, doubtless, the current of authorities hold such return to be necessary; and without at this time, further doubting or questioning the reasonableness of such rule, we think it has no fáir or legitimate application, when the proceeding is against the estate of a decedent. As already stated, the personal property of the decedent is primarily liable to the payment of his debts. As to this portion of the estate, the judgment creditor has no priority or preference over others. If this shall be insufficient to pay the debts and charges, the administrator may upon proper -showing, obtain an order to sell the real estate. And as to this portion of the estate, the judgment crditor has no preference over other claims, except such liens as axe allowed by law in his favor. The personal estate is to be administered and distributed by the administrator. It cannot be sold under execution issued, or any judgment recovered, in the lifetime of the decedent, nor can the real estate be made subject to such execution, until the administrator, heirs, and devisees, are made parties to such judgments, and an order, of court obtained awarding execution against the same. Then, as he cannot take personal property, and cannot reach the legal estate in lands, until he obtains an order of court awarding execution, why shall an estate be compelled to pay the expense of such a proceeding that can avail nothing, if the equitable property is all there is from which the judgment can be made ? And this suggestion is of conclusive force, when it is borne in mind, that in order- to have such execution, he must aver that there is real estate, describing it, against which the execution should be awarded. The law does not require vain things; Collins v. Vandever, 1 Iowa, 378; neither does it require impossible things.

But independent of the view arising from the statute, we are satisfied that the rule requiring a return of nulla bona, has no application when the creditor’s bill is filed against a decedent’s estate. Such cases form exceptions to the general rule. And in some of the states, the exception is carried so far as to allow the creditor to proceed in chancery, to reach *385•the equitable estate of oue deceased, before judgment, and this has been permitted in our own state. Brigman v. Doolittle, 1 G. Greene, 265; and see Thompson v. Brown, 4 Johns. Ch. 630; Sweney v. Ferguson, 2 Blackf. 129; Kipper et al. v. Glancey et al., Ib. 356; O’Brien v. Coulter, Ib. 421; Russel v. Clarke’s executors, 7 Cranch, 89; McDowell v. Cochran, 11 Ill. 31.

Other questions are raised by counsel, of less importance than those above noticed. But as the cause will be remanded aud reheard, we forbear at present any reference to such other points, and especially so, ás from the attitude of the case, after bringing in the necessary parties, such questions may not arise. We may add, however, that it may well be doubted, "whether the insolvency of the decedent is averred with sufficient distinctness, and whether a satisfactory adjudication of the matters in controversy, would not be more certainly attained, if both parties should be allowed to re-plead.

So much of the decree as sustains the bill in favor of Keeler, is reversed, and the whole cause remanded with leave to amend, &c.