156 Ky. 304 | Ky. Ct. App. | 1913
Opinion of the Court by
Commissioner — Affirming on Original and Cross Appeals.
Richard Meriwether died in Shelby County, Kentucky, in the year 1871, leaving a last will and testament. By the sixth item of his will he bequeathed ten Louisville & Portland Canal bonds of the value of $1,000 each, and a claim which he had against his brother, George Wood Meriwether, to his executor and trustee “in trust for the sole and separate use and benefit of my brother, George Wood Meriwether, during his life and the interest and income thereon to be paid over to my said brother, George Wood Meriwether, annually or semi-annually as it may arise and no more.”
The claim against George Wood Meriwether was invested in a tract of land consisting of 102 acres. This tract of land was finally sold, and since April 13, 1900, has been represented by a note of W. I. Pry for $3,458.15.
David Meriwether, a brother of Richard Meriwether, was appointed executor of his will and trustee of George Wood Meriwether. He qualified as such and continued to act until his death, when J. L. Caldwell was appointed administrator de bonis non and also trustee of George Wood Meriwether. ‘Caldwell acted as trustee until the year 1882, when L. A. Weakley, a lawyer and business man of high standing, was appointed in his place. L. A. Weakley continued to act as trustee until his death in August, 1895. On November 18, 1895, C. S. Weakley, a brother of L. A. Weakley, the former trustee, and executor of the latter’s will, was appointed trustee. While Caldwell was acting as trustee he sold the ten bonds at their par value and held the proceeds of the sale, amounting to $10,000, up until his death. This sum he turned over to L. A.
This action was brought by C. S. Weakley as trustee of George Wood Meriwether and as executor of his brother, L. A. Weakley, against George Wood Meri
After filing various pleadings which were subsequently abandoned, George Wood Meriwether predicated his defense on a second amended and reformed answer, set-off and counter-claim, wherein he pleaded that by mistake the various county court settlements erroneously charged him with interest not legally due and that certain commissions allowed the trustee were not properly allowed. |
On final hearing the chancellor held that the income from the trust estate should be treated as accruing annually and interest charged thereon accordingly, instead of charging interest upon settlements of income at bi-ennial rests, the plan adopted by the trustee.
The order held that the trustees were not entitled to any commisssion for* handling the fund of $10,000 which they had commingled with their own funds. Thereupon he referred the case to the commissioner to re-cast the accounts, and gave judgment accordingly. From the judgment so entered plaintiff appeals and defendant prosecutes a cross-appeal.
. (1) To the plea of mistake in the final settlement of the accounts of L. A. Weakley, trustee, made in the year 1895, plaintiff interposed the five and ten year statutes of limitation. The chancellor held that the statute was not applicable. It is insisted that this ruling was erroneous. If this were a suit by George Wood Meriwether to surcharge the settlement in question, the statute of limitations would undoubtedly apply. Blake v. Wolf, 105 Ky., 380; Wren v. Wren, 126 Ky., 704. These cases, however, have no application to the case under consideration. Here suit was brought on an obligation based on and growing out of a settlement. Defendant pleaded that by mistake he was charged in that settlement with certain items which should not have been charged against him ; that these items were included within the note sued on, and that the note to that extent was without consideration. This plea was a mere defense, and to such a defense we' have frequently held the statute of limitations is not applicable. Edwards v. McKinsey, 14 Ky. L. R., 925; Grover v. Tingle, 21 Ky. L. R., 885; Aultman v. Mead, 109 Ky., 583, 89 S. W., 137; Alexander v. Owen
(2) But it is insisted that in the settlement in question Meriwether and the trustee presented conflicting claims, and that Meriwether having actually agreed to the settlement the plea of accord and satisfaction should prevail. The evidence, however, doe's not make out a case of accord and satisfaction. It is to the effect that Meriwether objected to certain claims presented by the trustee and that these claims are not embraced in the settlement. On the other hand Meriwether says that he did not know that the method of computing interest was wrong, and there is nothing to show that the question of interest was ever considered or discussed by the parties, or that the claims in question were disallowed because of the method adopted.
It is further contended that as the trustee regularly accounted for interest at the legal rate, and always acted in good faith, no just reason is. shown why he should be punished by denying him compensation. While it is true that the record affords no ground for questioning the integrity of the trustee, we see no reason to depart from the salutary rule that a trustee who commingles trust funds with his own and who performs no service for the trust estate other than the payment to the beneficiary of interest due from himself is not entitled to compensation.
On the cross appeal it is insisted that the court erred in not charging the trustee interest on the theory and basis that it was received semi-annually, since the will directed the income to be paid over to the cestui que trust annually or semi-annually as it might arise. Taking into consideration the fact that it is not always practicable or possible to keep as large a sum as $10,000 invested for a long period of time so as to produce an income of six per
Another error complained of on cross appeal is the allowance of a fee of $600 to plaintiffs’ attorneys, payable out of the trust estate. In this connection it is insisted that their efforts were directed chiefly to the defeat of the claims of the defendant which were upheld by the court, and that for this reason the fee is unreasonable. We have carefully considered the record, however, and conclude that the fee allowed is not disproportionate to the services which they, independently of their efforts to defeat defendant’s claim, actually rendered the estate itself.
Judgment affirmed both on original and cross appeals.