139 Ky. 268 | Ky. Ct. App. | 1910
Opinion op the Court by
Eeversing.
William Schlickman, a resident of Covington, Ky., died in March, 1894. For many years prior to his death he had been engaged in the pork-packing business, first in partnership with one Daniel Enttle and later as a member of the Buttle, Schlickman Packing Company, a corporation, which was organized about 1890. He and Enttle, his former partner, owned practically all of the stock, and, in 1892, he bought the interest of Enttle in the business, so that, at the time of his death, he owned practically all of the stock of the packing company. A few shares .which were not owned by him were held by employes merely for the purpose of organization. He left a will giving all
Two propositions are raised for our consideration: First, did the will of William Schlickman authorize his executor to contract debts and bind his estate for the purpose of carrying on the pork-packing business of the Ruttle, Schlickman Packing Company? And, second, if such power is conferred upon the named executor as would authorize the creation of these debts by him so as to bind the estate therefor, did such authority "pass to the administrators de bonis non with the will annexed; or was it personal to Pie-per, the named executor? Said will which we are called upon to construe is as follows:-
“I, William Schlickman, of Covington, Kenton county, Kentucky, being of sound and disposing mind and memory, and recognizing the uncertainty of life, do hereby make this my last will and testament, to-wit:
“First. I direct my executor .hereinafter named out of my estate to pay all my just debts.
“Second. I hereby bequeath and devise unto my children all of my estate of whatsoever kind and wherever situated to have and to hold share and share alike, the said children being named, to-wit: Emma, wife of John Dor sel, Henry Schlickman, Leo Schlickman, Clara Schlickman, William Schlickman, Mary Schlickman, Frederick Schlickman, Margaret Schlickman and Norbert Schlickman.
“Third. I hold the title to a house and lot on the west side of Holman street between Fifteenth and Sixteenth streets, in Covington, Kentucky, the lot being conveyed to me by Crockett, which property has*272 been mortgaged by me to the Kentucky Perpetual Building and Loan Association for $1,500.
“Tliis property belongs to Mrs. Mary Frecking and the title is held ‘by me in order to borrow said yum from said Building Association, and I am also ile surety on a note for $4-00 to Lambert Determan and the title to this property is held by me to secure the payment of said note and whenever said Building-Association debt is satisfied and said note paid so that my estate is relieved from all liability on account of either of said debts then my executor will by a proper deed convey the said property to said Mary Frecking- giving her free and unincumbered title thereto.
“Fourth. I appoint Fred Pieper guardian of my infant and unmarried children being all of my children hereinbefore named except Emma Dorsel.
“Fifth. I hereby nominate as executor of this my will the said Fred Pieper and ask that he be allowed to qualify and act as such without giving bond and I hereby fully authorize and empower him as my executor to do any and all things concerning my estate that I could do if living, leaving it to his judgment and discretion as to how he shall manage the same or carry on my business and giving to him full power and authority to sell and convey any or all of my real estate when in his judgment it may be desirable to do so, and the devise to my children herein is especially subject to the power thus vested in my said executor that is the devise to them is in no way to be construed as a limitation on the power of said executor to sell and convey by deed said real estate as to carry on said business.
“In witness whereof I, the said Henry Schlickman, do hereby this 26th day of February, 1894:, set my*273 hand in the presence of Henry Linneman 'and J. W. Bryan whom I have requested to attest this will. Wm. Schlickman.”
The record discloses that, at the date of the death of William Schlickman, the pork-packing business owed approximately $22,500. It was the custom of this company to borrow money with which to purchase the hogs which were slaughtered and packed during the fall and winter season, and, when the cured meats, etc., were sold in the following spring and summer, these obligations would be discharged. After the death of William Schlickman, the packing company did not make money, and this is particularly true after the business passed into the hands of the administrators de bonis non with the will annexed. It cannot be said that this failure of the business to make money was due to any mismanagement on the part of the administrators; but it may more properly be chargeable to the fact that the'company, with its limited capital, was unable to compete with the large packing establishments which, by reason of their improved business facilities, were enabled to buy upon more favorable terms and sell to better advantage than their less fortunate rivals. The business steadily lost money, and when all of its assets had been exhausted the company was still largely indebted. Of this indebtedness, $10,080 was due to the Citizens’ National Bank, and, upon the notes evidencing same, ■the administrators of the estate of William Schlickman with the will annexed had sought to bind his estate as surety.
At the date of the death of decedent, the packing company had assets worth approximately $40,000, and it was indebted to the First National Bank in the sum of $22,500, and the estate of decedent was bound
The entire estate of the decedent was, of course, bound for the payment of notes amounting to $22,500 which the Packing Company owed at the date ®f his death and upon which he was security. These claims were held by the First National Bank. As they matured they were taken np and either paid off by money realized out of the business of the packing company, or furnished by the executor, or else from money borrowed by the packing company, upon its notes, from the Citizens’ National Bank, with the executor
We are of opinion that the executor, Pieper, was authorized, under the power given him by the fifth clause of the will, to borrow money to carry on the business of the packing company, and that the entire estate of decedent was bound therefor; and it is im-. material whether he signed these notes as principal or as surety, so long as it was to enable the company to raise money necessary to properly carry on its business, or rather, to carry on the business in a way which he deemed to be proper. The estate, in either event was bound therefor. He did not find it necessary to. bind the .estate; .as,' principal in order to raise money for the packing company, but, by endorsing the notes as surety for the packing company, he enabled it to raise such money as it needed. The administrators with the will annexed, upon taking charge of
What did the testator intend by the use of the language therein, employed? That he had the most unlimited confidence in the honesty, integrity and business capacity of his friend Pieper is quite evident, for he not only invested him with absolute power as to> the management and control 'of his property and business, but requested that the court should require' of him no bond for the faithful execution of the trust reposed in him; and, in addition, he selected him as. guardian for his children, most of whom were of tender years. It can scarcely be presumed that he intended, by the language used in this clause of his. will, that his unlimited authority as to the management of his estate should be exercised by any one else. No such presumption should be indulged unless the language employed by the testator, when fairly con
This proposition is not disputed by counsel for appellee, but it is earnestly contended that the duties imposed by the fifth clause of the will are purely executorial, and that no trust relation is created by the language used in said clause. The duties of an executor are to collect and preserve the personal estate, pay the debts and costs of administration, and distribute the surplus to those justly entitled thereto, either as directed by the will or provided by law.
But, it is urged, under section 3892, Ky. St. (Russell’s St. sec. 3938), these duties passed to and devolved upon the administrator with the will annexed, and hence, whether in their nature in fact executorial or not, being treated as such by the statute, the administrators with the will annexed had authority, under and by virtue of said statute, to bind the estate of decedent in the way and manner in which they did. This same statute was in force when the case of Warfield v. Brand’s Admr, above referred to, was written, and in that case the court held that duties which were purely personal to the named executor did not pass to and devolve upon the administrator with the will annexed, as shown by the following excerpt from the opinion: 1 ‘ The statute was, no doubt, enacted solely to facilitate the settlement of estates, and we are unwilling to believe that the Legislature intended to go beyond what was necessary for that
Reading the statute under consideration in the light of the construction placed upon it in the forego
Much stress is laid by appellee upon the phrase 'in the fifth clause “and the devise to my children herein is especially subject to the power thus vested in my said executor that is the devise to them is in no way to be construed as a limitation on the power of said ox • ecutor to sell and convey by deed said real estate or to
It is very apparent from even a casual consideration of the will in question that the testator desired to place in the hands of his friend Pieper the management and conduct of his business and the settlement of his estate, because of the confidence which he had in his honesty, integrity, and business ability. This confidence finds expression not only in the fact that he directed that the court should require of his friend no bond whatever, but in the further fact that no limitation was placed upon his judgment as to the manner in which the business should be conducted or the' length of time it was to be operated by his friend. It cannot be that he contemplated that these extraordinary powers and great confidences were to be discharged by or reposed in any one other than his friend Pieper, and although in granting same he directs that they shall be discharged by his executor, inasmuch as he named him, these words must be regarded as descriptive of the person rather than intended to be applied to any one who might fill the office. So that, while Pieper had the right to operate the business of the packing company, and pledge the estate of decedent for such funds as in his judgment it became necessary from time to time to borrow, these were rights which he possessed and enjoyed under and by virtue of the personal trust reposed in him by the will, and not in his capacity as executor. This being
The exceptions to the report of claims filed by the master commissioner should have been overruled. Judgment reversed and cause remanded, with instructions to do so.