| Mo. Ct. App. | May 9, 1893
Lead Opinion
— Action on a guardian’s bond. The facts 'are undisputed. In December, 1874, John B. Johnson, curator of the estate of the relator (who was then a minor of about ten years of age), resigned his trust, and W. H. Horner, now deceased, was appointed in his stead by the probate court of the county of St. Louis. Horner accepted the trust, and he as principal,
A principal note of Phebe Hunt for $5,000, dated January 27, 1871, payable three years after date, and one semi-annual interest note for $200 of the same date, were among the property turned overby Johnson to Horner, and to secure them Phebe Hunt had given a deed of trust on certain real estate in the city of St. Louis. There was also another note of Phebe Hunt for $6,385.34, dated October 26, 1874, payable three years after date, and three annual interest notes for $638.33 each, to secure which another deed of trust was given on the same property and certain other real estate in said city.
The trustee in the first deed of trust having refused to act, Horner as curator on May 20, 1881, applied to the circuit court of the city of St. Louis for the appointment of another trustee, which was done, the court appointing R. D. Lancaster.
Default having been made in the payment of all the notes, the property was advertised for sale under both deeds of trust, the sale to take place June 20, 1881.
On June 17, 1881, Horner represented to the probate court that the property was advertised for sale, that the total indebtedness amounted to about $12,000, and that, unless he would bid on the property, he believed that it would be sold at a sacrifice. Thereupon the court by an order entered of record authorized Horner to buy the property for his ward at the sale, provided it did not sell in excess of $10,000. Horner bought under both deeds of trust for $2,500. He received deeds from both trustees conveying to him individually the entire property; in one of the deeds, however, was embodied the order of the circuit court reciting the fact
On June 25, 1881, Horner executed a deed of trust to R. D. Lancaster as trustee for the State Savings Association of St. Louis, whereby he conveyed the property so purchased by him to secure the payment of his individual debt, amounting at the time to $2,500.
On June 17, 1882, Horner executed and placed on record a quitclaim deed conveying the property to the relator; no reference, however, was made in this deed to the deed of trust previously given to secure the note held by the State Savings Association.
On June 21, 1882, Horner filed in the probate •court his seventh annual settlement as curator, in which he set forth the purchase of the land for his ward for the sum of $2,500, and the subsequent conveyance by him of the property to the relator. The statement contained no reference to the incumbrance which •the curator had placed on the property.
On August 16, 1885, the relator reached his majority, and on October 23, 1886, Horner died without having made a final settlement of his curatorship.
On November 9, 1886, letters of administration on the estate of Horner were granted to the defendant, Eugene O. Tittman, notice of which was afterwards published as required by law.
On January 10,, 1887, Tittman, as administrator of Horner, made a final settlement of the curatorship. At the time this settlement was made, neither the relator nor Tittman had notice of the incumbrance on the property, and therefore the relator made no objection to the approval of the settlement.
It also appears from the evidence that, either before or just after the relator filed the suit-in equity, he notified the appellant of the institution of the suit, and he required him to appear and conduct the suit. It is conceded that the appellant’s attorney assisted in the conduct of the case, but left the burden of the work to the relator’s attorney. In the prosecution of the suit the relator paid $500 counsel fees, and incurred -other necessary expense amounting to $103.65.
The relator claimed that the foregoing facts, which were stated in the petition, constituted a breach of the conditions of the bond, in that Horner had impaired the title to the trust property in his attempt to charge it with the payment of his individual debt, and that the defendants were answerable to the relator for all proximate damages resulting from this breach of trust, including counsel fees and other necessary non-iaxable costs paid by him in the prosecution of the equity suit.
The defendants denied the alleged breach of the bond, and that they were liable for counsel fees and ■other non-taxable costs as alleged; .'and they pleaded
The court sitting as a jury rendered judgment against both defendants for the penalty of the bond, to be satisfied by the payment of $644.37, which was the amount of the attorney’s fees and non-taxable costs paid by relator, with six per cent, interest thereon from the date of payment. The defendant Lucas only has appealed.
The execution by Horner of the deed of trust, in which he attempted to charge the real estate of his ward with the payment of his individual debt, was a breach of the conditions of his bond. By this wrongful and unlawful act he committed waste. Any act of his which tended to decrease the value of the real estate held by him for his-ward, or which impaired the evidence of title thereto, was waste for which his estate and the sureties on his bond are liable. Bond v. Lockwood, 33 Ill. 212" court="Ill." date_filed="1864-01-15" href="https://app.midpage.ai/document/bond-v-lockwood-6951121?utm_source=webapp" opinion_id="6951121">33 Ill. 212; Eield’s Law of Gruardians, sec. 98, and authorities cited.
Did the court err in the assessment of the damages is the next question.
The recovery for the violation of contracts of indemnity includes all damage which is the natural or proximate result of the breach. The supreme court in the case of Kansas City Hotel Co. v. Sauer, 65 Mo. 279" court="Mo." date_filed="1877-10-15" href="https://app.midpage.ai/document/kansas-city-hotel-co-v-sauer-8005659?utm_source=webapp" opinion_id="8005659">65 Mo. 279, held that the liability of the obligors for the violation of such a contract is measured “by a sum sufficient to put the plaintiff in as good plight as if defendant had kept his covenant.” This is the general rule, and we can see no good reason for adopting a different rule in actions on bonds of guardians or curators. The doctrine of strictissimi ju/ris, which is here invoked for the protection of appellant against liability for the
Now, it must be conceded that the institution of the equity suit was made necessary by the wrongful act of Horner; therefore the expenses necessarily incurred by the relator must be considered as the natural or proximate result of the breach of the bond. As it is admitted that the defendant had notice of the suit, that he was given an opportunity to take charge of its prosecution, and that its successful prosecution redounded to his benefit, we think the action of the court in the assessment of damages was clearly right. It met the equities of the case and gave full idemnity for the wrong done. We also think that the .action of the court is sustained by analogous cases.
The case of Johnson v. Meyers, Executor, 34 Mo. 255" court="Mo." date_filed="1863-10-15" href="https://app.midpage.ai/document/johnson-v-blanks-8001443?utm_source=webapp" opinion_id="8001443">34 Mo. 255, was an action for a breach of warranty of title to a slave. The complainant was compelled to defend a suit brought against him for the recovery of the slave. The court held that he could recover his costs in defending this suit, if he gave his vendor notice of it.
In the case of Kansas City Hotel Co. v. Sauer, supra, the plaintiff sued for a violation of the covenants in a bond of indemnity. The bond was given to save the plaintiff harmless from certain mechanic’s lien claims. The recovery in the action included attorney’s fees and other expenses paid by plaintiff in defending against the claims, and the supreme court sustained the judgment.
In the case of Ryerson v. Chapman, 66 Me. 557" court="Me." date_filed="1877-04-04" href="https://app.midpage.ai/document/ryerson-v-chapman-4933109?utm_source=webapp" opinion_id="4933109">66 Me. 557, it ' was held that the grantee in a deed of general warranty, after eviction by one having superior title, is entitled to
Mr. Sedgwick says: “Where a plaintiff has become involved in another suit by defendant’s acts, he should recover the amount of reasonable expenses in which he has become involved, and there seems to be no reason for distinguishing between counsel fees and other proper costs and expenses. Sedgwick on Damages [8 Ed.] sec. 236.
The defense of the special statute of limitations, barring the allowance of claims against an estate, unless presented within two years after the grant of letters, is without merit. It may be true that there was a technical breach of the bond the moment Horner executed the deed of trust, but in contemplation of law the cause of action did not accrue to the relator until his right to recover substantial damages existed. Tenny’s Adm’r v. Lasley’s Adm’r, 80 Mo. 664" court="Mo." date_filed="1883-10-15" href="https://app.midpage.ai/document/tennys-adminstrator-v-lasleys-administrators-8007763?utm_source=webapp" opinion_id="8007763">80 Mo. 664; Chambers’ Adm’r v. Smith’s Adm’r, 23 Mo. 174" court="Mo." date_filed="1856-03-15" href="https://app.midpage.ai/document/chambers-administrator-v-smiths-administrator-7999827?utm_source=webapp" opinion_id="7999827">23 Mo. 174.
In Chambers Adm’r v. Smith, Adm’r, supra, the suit was brought against an estate for damages for the breach of the covenant of seizin, contained in a deed. The suit was instituted more than three years after the grant of letters. The court in disposing of a similar plea said: “In reference both to the limitation and to the person entitled to the benefit of the covenant, we look in a case of the 'present character to the right of substantial recovery, and will not hold a party barred by the lapse of time which ran before he was allowed to recover (for we make no destinction here between no recovery and a mere nominal one).” This, language is applicable to the case at bar; for at no time could the relator have recovered anything in excess of nominal damages until the final determination of the
The judgment of the circuit court will be affirmed.
Dissenting Opinion
(dissenting.) — I am unable to agree with the disposition of this case in the majority opinion of this court.
This is an-action on a curator’s bond, executed by W. H. Horner with appellant as one of the sureties thereon, for the purpose of recovering certain expenses and counsel fees incurred and paid by relator in the successful prosecution of a suit to vest title in himself in certain real estate, alleged in the petition herein to have been purchased by the curator with money of relator, and to have been conveyed to said curator in his individual name and subsequehtly incumbered for his private use and benefit.
The facts are that W. H. Horner, curator of' respondent, came into possession as such curator of certain notes due his ward which were secured by a deed of trust. Upon foreclosure of this deed of trust, said curator bid in the property and took a deed therefor in his individual name, and credited the purchase price on the notes in his hands' belonging to his ward. A few days after this purchase, to-wit, June 25, 1881, said Horner and wife conveyed by deed of trust duly recorded the said property to secure a loan of $2,500 made to him and interest notes thereon, all payable in one year. On June 7, 1882, the said Horner, then a widower, executed do relator a quitclaim deed duly recorded to said property. On July 21, 1882, the . said Horner made a seventh annual settlement, in which among other things he reported the purchase by him of the property at
Neither Charles L. Patterson relator, nor his counsel knew of the making of the deed of trust by said Horner, dated June 25, 1881, to secure his said note of $2,500 until informed of the fact sometime in April, 1887. They then learned also that said note had been transferred in due course of trade, and that the last holders were causing an advertisement of sale under-said deed to secure payment.
On September 7, 1887, suit was brought by relator Charles L. Patterson to set aside and annul the said trust deed given by said Horner as aforesaid on the property in question to secure his individual indebtedness. A decree sustaining the petition of relator was entered in the circuit court, and upon an appeal affirmed in the supreme court on February 23, 1891. Appellant was notified by relator of the institution of his suit to cancel said trust deed and vest title in himself. Appellant’s attorney cooperated with relator’s attorney in the prosecution of said suit in the circuit court. Relator paid his counsel for services and expenses in said suit the sum of $603.65. No claim nor demand was exhibited or presented against the estate of W. H. Horner by relator. Said estate, though insolvent, paid out a dividend of forty-two hundredths on debts established; total payment $11,916.40.
If it were admitted for argument that the present cause of action is barred as a demand against the estate of W. H. Horner, the principal in the bond, under the statute of limitations in the administration act, non constat that it is barred thereby against the surety on the bond executed by the deceased curator. This exact point was before the supreme court of Arkansas. Ashby v. Johnston, 23 Ark. 163" court="Ark." date_filed="1861-01-15" href="https://app.midpage.ai/document/ashby-v-johnston-6539293?utm_source=webapp" opinion_id="6539293">23 Ark. 163. That was a suit by two wards against the sureties of the deceased guardian, who interposed the defense that the claim was not presented “within two years after grant of letters.” The judgment of the trial court sustaining a demurrer to this plea was affirmed in the supreme court, who stated the rule thus: “But it is well settled that where, from mere omission of the obligee to probate the claim in time, the cause of action is barred against the estate of the principal, in the hands of his executor or administrator, by the statute of non-claim, this of itself does not discharge the sureties in the bond.”
To the same effect is Chapin v. Livermore, 13 Gray, 561; Marshall v. Hudson, 9 Yerg. 63; Ordinary for use, etc., v. Smith, 55 Ga. 15" court="Ga." date_filed="1875-07-15" href="https://app.midpage.ai/document/ordinary-v-smith-5557653?utm_source=webapp" opinion_id="5557653">55 Ga. 15.
I am, however, satisfied that the cause of action alleged in the petition in this cause did not arise until the payments sued for had been made, to-wit, the date
The next assignment presents a question of new impression, namely, whether counsel fees and expenses of litigation, other than taxable costs, are recoverable in the present action on the curator’s bond? I am of the opinion that they- are not elements of recovery against a surety on a curator’s bond in a suit thereon to enforce his liability under the stipulations and conditions of a bond framed (as the present,one) according to the provision of section 5299, Revised Statutes, 1889.
This action is brought on the bond of appellant as surety for the compliance of the curator with its conditions. The liability of appellant is measured by the obligations imposed by the terms of the bond. The law does not permit a surety to be held on the default of his principal beyond the precise terms of thefinstrument of suretyship. The liability of a curator is to account for and pay over all the estate of his ward which either came into his possession as curator, or would have come into his 'possession by the exercise of ordinary care and diligence. In the case at bar the curator credited certain notes of his ward in payment of the purchase money of a lot of ground conveyed to the curator in his personal capacity. He then mortgaged the lot to secure his personal debt, and then executed a quitclaim of the lot to his ward, and at his next settlement as curator reported (erroneously) to the probate court that the lot had boen purchased for
In the case of State to use, etc,, v. Bishop, 24 Md. 310" court="Md." date_filed="1866-03-22" href="https://app.midpage.ai/document/state-ex-rel-murray-v-bishop-7892097?utm_source=webapp" opinion_id="7892097">24 Md. 310, which was an action on the guardian’s bond, the facts showed that the ward had received from third parties certain shares of stock belonging to him which his guardian had illegally transferred, The
In Mann, Judge, etc., v. Everts, 64 Wis. 372" court="Wis." date_filed="1885-11-03" href="https://app.midpage.ai/document/mann-v-everts-6604895?utm_source=webapp" opinion_id="6604895">64 Wis. 372, the supreme court reversed a judgment of the trial court, permitting a recovery for counsel fees in a suit on an administrator’s bond given for sale of the real estate, saying: “We do not think such counsel fees are covered by the obligation of the surety on this bond, therefore they should not be recovered.”
In Henry v. Davis, 123 Mass. 345" court="Mass." date_filed="1877-11-16" href="https://app.midpage.ai/document/henry-v-davis-6419040?utm_source=webapp" opinion_id="6419040">123 Mass. 345, the facts were that the bond sued on contained a condition, that defendant should abide the decision of arbitrators selected to establish a boundary line between his estate and that of plaintiff, and should execute plaintiff a quitclaim deed according to the award of the arbitrators. Defendant committed breach by refusing to carry out the award of the arbitrators by giving a quitclaim deed, and brought a bill in equity to set aside the award, which after a hearing was dismissed with costs. Thereupon plaintiff sued defendant upon, said bond to recover the expenses incurred in the equity .suit to set aside the award. The court held: “The plaintiff has been awarded his costs in that suit. The theory of the law is, that the taxable costs awarded to the prevailing party in a suit furnish a full indemnity to him for all his expenses incurred in the suit. Therefore a defendant who successfully defends a suit brought against ¡ him has no right of action or claim beyond the amount of the taxable costs against the plaintiff therein. It' follows that the plaintiff in the case at bar has no claim against the defendant for the expenses he seeks to recover, which he can enforce either directly by a suit or indirectly as damages for a breach of his bond.” To the same effect are Oelrichs v. Spain (15 Wall.), 82
There are exceptional cases in which counsel fees may be' recovered in suits on contracts or bonds, although the general rule confines such recoveries to actions of tort. It has been held that they are embraced in injunction bonds, attachment bonds or any other contract made by a surety, broad enough in its stipulations to cover damages or loss incurred in the employment of counsel or discharge of the contract. But the distinct ground of these holdings is that the peculiar condition or stipulation of the bond or contract in question provides such general or special indemnification of damages as necessarily embraces counsel fees and non-taxable expenses.
The authorities relied upon by respondent belong to this class. In N. H. & N. Co. v. Hayden, 117 Mass. 433" court="Mass." date_filed="1875-04-01" href="https://app.midpage.ai/document/new-haven--northampton-co-v-hayden-6418086?utm_source=webapp" opinion_id="6418086">117 Mass. 433, the contract on which defendants were held liable for counsel fees was one that bound them to secure the plaintiff a right of way free of charge. Upon breach it was held that stipulation would cover counsel fees in securing the right of way. In Dubois v. Hermance, 56 N.Y. 673" court="NY" date_filed="1874-05-26" href="https://app.midpage.ai/document/dubois-v--hermance-3591835?utm_source=webapp" opinion_id="3591835">56 N. Y. 673, a contract to perform all the outstanding contracts of plaintiffs was held to embrace counsel fees paid by plaintiffs in defending one of their contracts which defendants had failed to perform. In Strong v. Ins. Co., 62 Mo. 289" court="Mo." date_filed="1876-01-15" href="https://app.midpage.ai/document/strong-v-phœnix-insurance-8005286?utm_source=webapp" opinion_id="8005286">62 Mo. 289, the doctrine is stated that a second insurer is bound by the judgment of the assured against the first insurer, there being a contract of indemnity between the two insurers binding the second insurer to pay the first insurer a certain part of the loss. It was decided in that case that there is no privity between the assured and the second insurer, the liability of the latter being wholly to the first insurer. For this reason, and because that liability would become absolute in the event of a judgment after loss against the
I fail to see that analogy between the cases (containing the clauses of full indemnity or warranty) cited in the opinion of the majority of the court and the case at bar. Each of those seems to be clearly one of the class of contracts, in which the obligatory words by express terms or necessary implication warrant the recovery had. No case has been adduced where a recovery for counsel fees was had in a suit on a guardian’s bond or any bond with similar conditions,. and the contrary has been held in the cases cited supra in this opinion. I do not think the conditions of a bond shouldbe strained against sureties; they are favorites in law, and have a right to stand upon the strict terms of their obligations when such terms are ascertained.
In the event of a suit upon an implied promise by the appellant to pay the counsel fees and expenses incurred by respondent after his election to sue for the lot rather than the money, the doctrine of Strong v. Ins. Co., 62 Mo. 289" court="Mo." date_filed="1876-01-15" href="https://app.midpage.ai/document/strong-v-phœnix-insurance-8005286?utm_source=webapp" opinion_id="8005286">62 Mo. 289, might be relevant under the facts: herein tending to show appellant’s connection with the litigation of respondent. As to the maintenance of such action I express no opinion. Unquestionably there can be no recovery in the .present action on the special contract expressed in the bond, even if it were admitted that the evidence tended to show an implied agreement on the part of appellant to reimburse respondent for the litigation to_ establish his title to the
For the error of the circuit court in giving the instruction authorizing a recovery in this action for counsel fees and non-taxable expenses, I think the judgment herein should be reversed and judgment-entered for nominal damages.
Rehearing
ON MOTION FOB BEHEAEING.
— Appellant cites the case of Haeussler v. Laclede Bank, 23 Mo. App. 282" court="Mo. Ct. App." date_filed="1886-11-09" href="https://app.midpage.ai/document/haeussler-v-laclede-bank-6615287?utm_source=webapp" opinion_id="6615287">23 Mo. App. 282, as a controlling decision of this court entitling him to a rehearing of this cause. I do not concur with my associates in refusing the rehearing prayed for by appellant, and I deem their opinion on the hearing of this cause contrary to the rule expressed in the opinion of this court in Haeussler v. Laclede Bank, supra.
The clerk of this court is hereby ordered to certify and transfer the original papers on file in this cause, and a full and complete transcript of the proceedings of this court therein, to the supreme court to be there reheard and determined as provided in section 6 of the amendment of article 6 of the constitution of Missouri.