Steinhart v. Gregory

| Ala. | Apr 11, 1912

SIMPSON, J.

The bill alleges that the complainants (one of whom is of age, and the other two recently having had their disability of nonage removed) own a plantation in Greene county; that J. D., and Albert Stein-hart, who were guardians of the complainants, in the year 1909 leased said plantation to Phil A. Barton for the years 1910-1911, receiving from him a note for the payment of 20 bales of cotton for each year; that said lease was made without any order from the probate court; that said note was made payable to “A. Steinhart, Ex.”; that said Albert Steinhart borrowed $2,000 from one of the defendants, B. F. Gregory, for his personal use, and assigned and transferred said notes as collateral security for the same; that Gregory had notice at the time that said notes were give for the rent of said plantation belonging to complainants; that on November 1, 1910, said Barton, although he had actual notice of the rights and interests of complainants, delivered to sai-tl Gregory said 20 bales of cotton in payment of the first note, and said- Gregory sold same for $1,401, and said Gregory has refused to pay the same on demand; that in August, 1910, said J. D. and Albert Steinhart resigned the guardianship, made a final settlement, and were discharged; that on said final settlement the amount of said rents was not accounted for.

The prayers of the bill are: First, for process; second, that the transfer of said notes be declared to be void, and a devastavit on the estate of complainants; third, that said B. F. Gregory be decreed to be a trustee for the benefit of complainants, and reqiured to account for the value of the cotton received by him and to deliver over the remaining note; also, that Phil A. Barton, the maker of the note, be required to pay the rent for 1911 to complainants; and, fourth, for general relief. This appeal is from a decree sustaining demurrers to the bill.

Besides the multifarious features of the bill, if complainants have any rights, their remedy at law is complete and adequate. Besides the liability of the guardians and their sureties, if any one has illegally collected rents, which ex aequo et bono belong to the wards, they can recover in an action at law. If the note for unpaid rent was given for the rent of their lands, and has not lawfully been disposed of, they can sue on it and recover. These rents constitute the income of their estate, which it was the duty of the guardians to appropriate to their maintenance and support.

As to the illegality of the lease, they ratify it by demanding the proceeds according to the contract.

The authority and power of a guardian over the assets belonging to his ward’s estate are similar to those of an executor; and while he may not apply them to the payment of his individual debts, and any one receiving tlie same with knoivledge that they are being applied to the indivdual indebtedness of the guardian is liable to account for the same, yet this court has said: “The authorities do not prevent the pledging, of choses in action to secure the debts of or borrow money for the estate, and there is a broad distinction between pledging notes of the estate to secure an antecedent debt of the trustee and pledging them as security for a present or subsequent consideration. In the latter case the pledgee is not required to follow' the money lent, and see that it is applied to the benefit of the estate.” — Farmers’ & Merchants’ Bank v. Sanford, 150 Ala. 195, 199, 43 South. 226, 227.

Finding no error in the record, the decree of the court is affirmed.

Affirmed.

All the Justices concur.