6 Mo. App. 105 | Mo. Ct. App. | 1878
delivered the opinion of the court.
This is an action by the widow and residuary legatee of Louis Wolf against one of the sureties on the executor’s bond. The breach assigned is that, during the period cov
It appears from the pleadings and evidence in the case that Staehlin, as executor of Wolf, gave bond in July, 1872, with defendant and others as sureties; afterwards, in September, 1873, at the instance of Mrs. Wolf and by order of the Probate Court, Staehlin gave an additional bond. Defendant is not one of the sureties on the second bond. In January, 1875, Staehlin made' final settlement, showing $30,806.09 due the estate in cash, besides notes and- stock, and was ordered to transfer the notes and stock to Mrs. Wolf, and to pay to her, of the cash shown to be due the estate, $30,614.74. This order has not been complied with.
In October, 1872, Staehlin, who was in the brewing business, was embarrassed. The cashier of the Central Bank knew the fact. On October 3, 1872, Staehlin negotiated at the Central Bank his own note for $12,000, the proceeds of which were paid to him by a cashier’s check of the Central Bank to his order as executor of the estate of Wolf, and were by Staehlin deposited to his private account in the Central Bank and used by him in his private business. He kept no separate bank account for the funds of the estate. As collateral security for this note, Staehlin, at the time he obtained the discount, deposited with the bank four notes belonging to the Wolf estate, all made to the order of Wolf during his lifetime, and all indorsed, not by Wolf, but by Staehlin as his executor; all secured by real estate, and all
It is contended by appellant that no loss whatever accrued to the estate in consequence of any misconduct by Staehlin prior to the giving of the second bond, in September, 1873. His theory, so far as we are able to gather it from the instructions asked by him and refused, and from his brief, ajipears to be this : that there was evidence tending to show that the Central Bank knew at the time these notes were pledged that they belonged to the estate of Wolf, and that the executor was about to use the funds partly to make good an overdraft to the bank and partly for the general purposes of his private business; and that therefore the notes which had not been paid or sold when the second bond
The law is settled that the sureties of an administrator who has committed a breach of his bond by converting to his own use the property of the estate will be liable upon their undertaking,, though the administrator may have subsequently given an additional bond, and have made settlements carrying down the balance due the estate so as to make the sureties upon the additional bond also liable. The State to use v. Drury, 36 Mo. 281. The breach of the bond complained of in the present case is the act of Staehlin in unlawfully pledging notes belonging to the estate and converting the proceeds to his own use. If, as is contended by appellant, the bank was a party to the fraud, and knew at the time that Staehlin was committing a wrong in pledging these notes, it may well be that an action might lie against the bank, but it by no means follows that the residuary legatee has not also an action against the sureties on Staehlin’s bond.
There is no evidence whatever in the record to support the statements of counsel in his brief, and the assumption in many instructions asked by him and refused, that Staehlin, at the time of the transfer of these collaterals to the bank, was overdrawn, or that he was in any way indebted to the bank. So far as any bad faith on the part of the bank is concerned, there is no direct evidence that the bank knew that Staehlin was about to apply the funds to any other purposes than those of the estate. The only facts of record tending to charge the bank with notice are those already set
There can be no doubt that by the act of Staehlin in pledging these notes they passed from his possession and control as executor, and as a direct consequence were lost to the estate. If the bank officials knew that the executor was raising money on these collaterals for purposes not connected with the estate, they took no title to the notes which they could have set up as against the beneficiaries of the estate. But Staehlin cannot be heard to say that he and the bank were partners in a fraud upon the estate of which he was executor; that because of the fraud no title passed to the bank: and that therefore he did not assign the notes, and therefore committed no wrong. And if he cannot allege this, his surety is in no better position.
The answer of defendant alleged as matter of special defence that, on March 14, 1874, at the special instance of Mrs. Wolf, the Probate Court ordered the executor to pay to her $5,000, because that sum at that date was all of the assets which had been realized by the executor; that said executor obeyed said order and paid said sum, and therefore prays to be dismissed. On the trial, the defendant offered in evidence an order of partial distribution of the sum named, made by the Probate Court at the date named, on condition that'Mrs. Wolf give to the executor an indemnifying bond. This order was objected to as irrelevant, and was properly excluded. Appellant insists that this order concludes the executor that so much was at that time due from him to the person named in the order, and concludes the'person named in the order that no more was then on hand. It is manifest,, however, that one applying for an order of partial distribution is not to be taken as asserting
On the trial, the Circuit Court excluded the record of a judgment against Nicholas Schaeffer, a surety on the second bond of Staehlin, in favor of Mrs. Wolf, for $27,706.60. There was no error in this. The new bond did not discharge the sureties in the former bond from liability for misconduct of their principal occurring before the second bond was given : it was cumulative. So far as the executor failed to pay the amount due upon final settlement, and ordered to be paid, this was a misconduct for ■ which his surety in the second bond was liable; but if that default was the consequence of a waste of the estate committed whilst the first bond was in force, a recovery might also be had on the first bond. The distributee might proceed upon either bond, or upon both. She might very well have judgment upon both bonds; though she could have only one satisfaction, she could have two judgments. State to use v. Drury, 36 Mo. 286; 49 Mo. 526; 53 Mo. 474; 56 Mo. 497. Nor is there any thing in the suggestion of counsel for appellant that the record of the former judgment on the second bond might be competent as tending to show an admission on the part of Mrs. Wolf that the dereliction of the executor occurred wholly during the existence of the second bond.
It is claimed that the recovery is excessive, in that no credit is given to Staehlin for his commissions onthe amount of three notes, though he is allowed commissions in his final settlement. This may be a matter to be considered in any proceedings between the sureties in separate bonds for contiibution, when such a case is presented, but the amount of
It is earnestly contended by counsel for appellant that inasmuch as the amount of the notes pledged by Staehlin to the bank as collateral security for his note for $12,000 was in excess of the amount for which he was liable, as the whole amount due on his note, and interest, was more than paid by the collection of the Ittner and Gehrke notes, the executor was entitled to a return of the Adamson note, and so much of the collection on the other notes as was in excess of the amount due on the note of Staehlin ; and inasmuch as Staehlin was clearly entitled to a return of this surplus, it is claimed that the neglect of Staehlin in not recovering it from the bank was a misfeasance occurring during the period covered by the second bond, and for which the sureties on that bond alone are liable.
Why none of the collaterals and no portion of the proceeds were returned by the bank to Staehlin, we cannot guess. There is no evidence in the record as to that. What does clearly appear is that Staehlin transferred all these notes to the Central Bank as security for an amount of money borrowed by him, and that no portion of the proceeds of any of them was ever collected by Staehlin as executor of the estate of Wolf, and that none of the notes ever returned to his possession after this assignment to the bank, in consequence of which they were wholly lost to the estate. This act occurred whilst the defendant in the present action was liable as surety on Staehlin’s bond. Whether any diligence on the part of Staehlin after he had committed the wrong which resulted in this waste of the estate would perhaps have enabled him to recover a por
The instructions given are in accordance with the views of the law expressed in this opinion. We see no error in the record to warrant a reversal of the judgment, and, with the concurrence of all the judges, it is affirmed.