140 Mass. 351 | Mass. | 1885
The defendants, who are the sureties on the bond of the late John P. Healy, as executor of the will of John Percival, having admitted a breach thereof, the case at bar has been referred to an assessor to report the facts, and is now before us upon a reservation of the questions of law raised upon the facts stated in his report, and in the subsequent agreement of additional facts by the parties.
It is not denied that Healy, as executor, paid all the debts, specific legacies, and funeral expenses of the testator. The first and most important inquiry is as to the responsibility of the sureties for that which came into his hands under the residuary clause of the will.
This is in the words following: “ All the rest and residue of my property and estate, real, personal, and mixed, of which I shall die seised, or to which I may be entitled at the time of my decease, I give, devise, and bequeath to the said John P. Healy, to be disposed of by him for such charitable purposes as he shall think proper.”
Thip clause is preceded by one which gave to Healy a sword and a portrait of the testator, to be disposed of “ in such way and manner” as he might think “fit and proper.” The earlier clause differs from that we are considering in the important respect that no restraint is placed upon the disposition Healy might make of the articles therein bequeathed, while the property bequeathed by the latter clause is “ to be disposed of ” by him for “charitable purposes,” although the selection of the objects of the charity which should receive the bounty was left to Healy.
The word “charitable” has a distinct legal meaning, derived from the St. of 43 Eliz. c. 4, from the construction given to it in the definition of its objects of charity, and from the application of the statute to other uses which are not included in those there enumerated, but which come within its spirit by analogy. While the gift to Healy is not, in terms, in trust, the object for which it is confided to the donee distinctly appears
While a bequest which could be applied to purposes other than charitable might be held too indefinite to be carried out, the limitation of its distribution to purposes well defined and deemed worthy of particular protection, even if various, would enable the court, were the fund still in the hands of the trustee, to compel him to execute this clause of the will by the selection of the charitable purposes to which the fund should be devoted. The testator has shown his intention to dispose of this gift for charitable purposes generally, and a confidence has been reposed in the trustee to make a selection of the objects of charity. If therefore the trustee proceeds in good faith, and with reasonable diligence, to divide and distribute such a legacy for purposes which could properly be called charitable, either by directly applying it to objects thereof, or transferring it to responsible societies or associations formed for such purposes, a court of chancery would not interfere with the exercise of his discretion. Should he refuse to do this, there would be no serious difficulty in compelling, by the proper agencies of such a court, the execution of the trust, and in preventing the fund from being misappropriated to selfish uses. Saltonstall v. Sanders, 11 Allen, 446. Loring v. Marsh, 2 Cliff. 469; 6 Wall. 337. Marsh v. Renton, 99 Mass. 132. Attorney General v. Gleg, 1 Atk. 356.
Whether the power to select charitable objects was strictly limited to Healy, on account of the personal confidence reposed in him, so that, if he had declined to accept the trust, or if he had deceased without completing the execution of it, it could not be executed by the intervention of the court, and, the trust thus failing, the fund should go to the next of kin, — or whether, the testator having distinctly shown his intention that it should be devoted to charitable purposes generally, it should be held that the power of selection was attached to the trust, so that it might be executed through a trustee, who should carry
The first inquiry is as to the liability of the sureties. While Healy fully completed the administration of the estate by the payment of all debts, legacies, and expenses, he settled no final account as executor, and did not, by any open and notorious act, discharge himself as such in the Probate Court by assuming to transfer the residue of the property to himself as trustee, or by any other act indicating an intention thereafter to hold the same for the purposes of the trust. The will gave to him two characters, those of executor and trustee; and the duties of the latter character were entirely distinct from and independent of those of the former. As actual payment cannot be made by one to himself, it has been held that, where the same person is executor and trustee, he must give bond in his character of trustee before he can exonerate himself from his liability as executor. Hall v. Cushing, 9 Pick. 395. Dorr v. Wainwright, 13 Pick. 328. Newcomb v. Williams, 9 Met. 525, 534. Conkey v. Dickinson, 13 Met. 51. Daggett v. White, 128 Mass. 398. Gen. Sts. c. 100, § 14. While it is not controverted by the defendants, that, if a case were presented where the trustee was legally compelled to give bonds, it would be necessary to show, by compliance with this requirement, that a transfer of the property was made by the executor, their principal contention is, that such is not the case at bar; and that, if it can be shown that Healy had fully completed his duties as executor, it must be held that the residue of the property was lawfully retained by him as trustee. This question will be of less interest hereafter, as, by the St. of 1873, c. 122, (Pub. Sts. c. 141, § 16,) every trustee is required to give at least his own personal bond, which certainly contemplates that, where the same person is executor and trustee, there shall be a distinct transfer of property to him in the latter capacity by authority of the Probate Court. Parker v. Sears, 117 Mass. 513. Even if this were a case where the trustee might be, and was by the will, exempted from giving bond, we should not be prepared to say that the facts that Healy ceased at a certain time to do any acts as executor, — all that was necessary in that
In Taylor v. Deblois, 4 Mason, 131, cited by the defendants, an administratrix, after a decree of the Probate Court ascertaining the distributive shares of the intestate estate, took the guardianship of one of the persons entitled to a share, who was a minor; it was held, that, by operation of law, she held the amount by way of retainer as guardian, and not as administratrix, and that no suit lay against her sureties upon the administration bond for the amount due her ward. But in that case, by a process in Rhode Island known as quietus, an administrator might be fully discharged by the Probate Court. This quietus, which was a decree rendered by that court, stated, in substance, that the administratrix had fully administered the estate, and ordered that “ she be, and hereby is, from henceforth acquitted and discharged of the same.” Before this quietus, she had signed a certificate to the Probate Court, which had been recognized by it, that she had in “ her possession and control,” as guardian, the shares of the minor whose property was afterwards wasted.
State v. Hearst, 12 Mo. 365, Coleman v. Smith, 14 S. Car. 511, and Carroll v. Bosley, 6 Yerg. 220, also relied on by the defendants, are all cases where the question of responsibility arose between the sureties on the bond of the principal defendant as administrator and the sureties on his bond as guardian. In these it was held that, when the time for the settlement of the estate as administrator had fully expired, and the distributive shares of the minors had been ascertained, it must be deemed that
The will by which Healy was appointed a trustee for the distribution of the residue of the estate for “charitable purposes” did not exempt him from giving a bond; but the defendants contend that Healy was, from the character of the trust, so situated that he could not properly have been required to give bond; and that therefore, as it is shown by a variety of facts that after 1865 he held the property as trustee, he must be deemed to have discharged his sureties on his bond as executor. If it were true that he was entitled to enter upon his duties as trustee without giving bond for their faithful performance, there would be force in this position, especially if, the debts and legacies having been paid, the residue had been ascertained by a proper decree of the Probate Court settling his account. But no such decree was ever made, nor was the trustee entitled to enter on his duties without giving bond.
The defendants upon this point rely on the case of Lowell, appellant, 22 Pick. 215, which is followed in Drury v. Natick, 10 Allen, 169. It is decided in Lowell, appellant, that, where property is given to trustees for the purpose of a general charity, such as the gift there in question, which was for the promotion of education and the advancement of science by a permanent institution, and where the testator had provided for the perpetuation of the trusts, and for a continuous succession of trustees, without reference to the probate law, and where he also had appointed perpetual visitors of his charity, it was not a gift in trust for any person or persons within the true intent and meaning of the statute; and that in such case the trustee was not required by law to give bond before entering upon the duties of his trust.
It is suggested, that, in the latter case, those who are to receive the benefit of this sum are entirely indefinite; that the only provision for putting in suit such a trustee’s bond is “ for the use and benefit of any person interested in the trust estate;” Gen. Sts. a. 100, § 12; Pub. Sts. c. 143, § 18; that no person or institution could thus describe itself; and, therefore, that it cannot have been intended that any such bond should have been given. We cannot assent to this. All persons who are themselves objects of charity within the legal meaning of the term, and any institutions founded for charitable purposes, might
We are therefore of opinion that the sureties on the executor’s bond of Healy are liable for the residue of the personal property received by him, and not disposed of for “ charitable purposes.”
In considering to what extent they are liable, it is necessary to determine whether they are responsible for the proceeds of the real estate sold by Healy. The will not only authorized, but directed, him to convert the whole real estate of the testator into money, as soon after the testator’s decease as it should seem expedient, and provided that any deed executed by him should convey as perfect a title as if made by the testator. He was authorized to sell at public or private sale, and did so by authority of the will, and not of the Probate Court, within a reasonable time after the death of the testator, receiving therefor the sum of $4700. This sum was not needed for the payment of expenses, debts, or any specific legacies.
The condition of the bond, according to the statutes in force when it was executed, was in its second clause, which is the only one necessary to be considered : “ to administer according to law and the will of the testator all his goods, chattels, rights, and credits, and the proceeds of all his real estate that may be sold for the payment of his debts and legacies, which shall come to the possession of said executor, or of any other person for him.”
By the St. of 1880, c. 152, (Pub. Sts. o. 129, § 5,) the condition of a bond given under such circumstances was altered by striking out the words “ for the payment of his debts and legacies,” and inserting the words “ or mortgaged.” The same statute of 1880 provided that, where license or authority was given
It has been held in Alley v. Lawrence, 12 Gray, 373, that a devise to executors in trust for the support of the testator’s children, with power to sell and convey any portion of the land, gives them a right to sell and convey in their own names without giving other bonds than as executors. It was not necessary there to consider what was the responsibility of the sureties for the money received from such a sale. Whether a power to sell given by will was to be treated as a personal trust and confidence only in executors named, so that it could only be executed by them, or whether, as prescribing the mode of administration of an estate, it would pass to survivors, or to an administrator with the will annexed, has also been a question several times discussed in our decisions. Warden v. Richards, 11 Gray, 277. Greenough v. Welles, 10 Cush. 571. Chandler v. Rider, 102 Mass. 268. Tainter v. Clark, 13 Met. 220. Even if an executor invested with a power to sell real estate, either as a matter
We understand that the argument by which this responsibility is deemed to exist is, that, the real estate having been lawfully turned into money under the power of the will, the proceeds became of “the goods, chattels, rights, and credits” of the estate, for the faithful administration of 'which the sureties were bound. If this argument were tenable, it would follow that, when real estate was ordered to be sold to a greater amount in value than was necessary for the payment of debts and legacies, which the Probate Court is authorized to do when land cannot be divided, the sureties on an administration bond in the form here used would be responsible for the surplus. Yet this is certainly not the case. An additional bond has always in such case been taken for the protection of this surplus, for the reason that the
There has been on this subject, it must be conceded, a conflict of authority in the decisions of the several States, not reconcilable by reason of the differences which exist in the form of the bonds considered in the several cases. They were all examined with great care in Probate Court v. Hazard, 13 R. I. 3. It was there held that, in a suit on an administrator’s bond conditioned to administer all the “goods, chattels, rights, and credits” of the deceased, the sureties were not liable for proceeds of real estate sold by the executor under a power in the will. The words “ the proceeds of real estate sold for the payment of debts and legacies ” are not found in the Rhode Island bond, but how strictly these have been limited in Massachusetts is shown by the cases already cited. Even if the real estate has been changed into money by virtue of a power in the will, it is not, in our view, that personal property for the administration of which the sureties became responsible. The direction of the will that his real estate should be turned into money did not make it “ his goods, chattels, rights, and credits,” for the administration of which, in addition to “the proceeds of all his real estate sold for the payment of debts and legacies,” the sureties became responsible.
In ascertaining the amount for which the sureties are to be held liable, it is important to determine whether any weight should be given to the books kept by Healy, and the evidence by which it was sought to supplement them. That the book which professed to be “ the account of the fund left by the will of John Percival to John P. Healy to be used by him for charitable purposes,” supplemented by the receipts of the respective societies to whom funds were given, and which shows an expenditure of $1100 to three charitable societies, although objected to by the plaintiff, was properly admitted, cannot fairly be questioned. Even if, as executor, Healy failed to settle his account, as it is found that there are no debts and legacies to be paid, if he distinctly devoted, as trustee, the funds left by Percival to charitable purposes, to the extent to which they were thus devoted the damages would be reduced. That these three gifts
The only evidence to show that Healy made other payments from the Percival fund is derived from the entries in certain family expense books, commencing in 1863, and including items as payments to charities, taxes, personal gifts, &c. By comparison of the amounts expended by Healy during the time covered by these books, and in former years, the defendants seek to establish the proposition that certain sums were expended from the Percival fund in discharge of his obligation to expend it in charity. Unless these family expense books were admissible in favor of the sureties to show the fact of payments from this fund, we have no occasion to consider the weight and the sufficiency of the evidence afforded by them. If properly rejected by the assessor, there was no evidence before him which would have justified a finding in favor of the sureties as to the sums claimed by them to be thus shown to have been expended. The statements in these books were not even entries made in a book of accounts for the purpose of charging those to whom they were made. They are mere declarations that certain sums were paid by Healy in charity; the payments do not purport to have been made on account of the Percival fund. Such declarations cannot afford legal evidence of payments by Healy in charity, far less of payments from the Percival fund, and were properly rejected by the assessor. Nor was the assessor bound, as contended by the defendants, to render judgment in their favor upon the presumption that the residue in Healy’s hands was paid out in accordance with the terms of the trust. Upon this point, the burden of proof was on the defendants. Choate v. Arrington, 116 Mass. 552.
There remain the questions of interest upon the sums for which the sureties are liable, and of any charges or commissions which may properly be deducted. When there is a wilful breach of duty, interest may be allowed, with annual rests. Jennison v. Hapgood, 10 Pick. 77,104. Ordinarily, when a trustee fails to pay over or to distribute money, he should at least be charged simple interest thereon. The question of compensation is also one within the discretion of the court to a large extent, and it may be wholly disallowed. Brooks v. Jackson, 125 Mass. 307.
In view of all the circumstances of the case, no wilful breach of duty is shown; it may have been that Mr. Healy wrongly thought, indeed, that no legal duty was imposed on him, but an obligation binding on his own conscience only. There has certainly been a failure to pay over the money when it should have been done. Admitting that the trustee was entitled to a certain length of time for the selection of the proper objects of charity, no reason appears why an ample opportunity had not been afforded when he made, on February 25,1867, the donation to the Ladies’ Home Educational Society. The last act done by him strictly as executor was on November 25, 1865, and the whole estate had been converted into personal property a considerable time previously. Upon the balance then due, deducting the sum of $4700, the price of the real estate, simple interest at six per cent should be computed from February 25, 1867, to the rendition of the judgment, and added to the principal sum. From this should be deducted Healy’s commission of two and one half per cent, as computed by the master, and the amount left in his hands.
Ordered accordingly.