33 Conn. 67 | Conn. | 1865
The bill seeks to make the executrix of the last will and testament of Charles J. Russ, deceased, accountable for fifty-three shares of the capital stock of the Hartford Fire Insurance Company, together with the dividends which have accrued thereon since 1842, under the following circumstances. The said Charles J. Russ in May, 1842, was appointed administrator with the will annexed, on the estate of Cornelia Russ, who died in April, 1842, leaving a will, the residuary clause of which was as follows :—
“ The rest and residue of my estate, real and personal, I direct should be held by trustees, hereinafter named, in trust as follows, to wit: — the same should be divided into seven parts, and held for the benefit of the children of my deceased sister and brother, to be divided and held for and delivered to them as follows : — each of the daughters to have two-sevenths parts, and the son of my sister, Mrs. Burrows, to have one-seventh part; the interest or income of the part belonging to each shall accumulate and be added to the principal, and not paid over to the children respectively until they shall respectively attain the age of twenty-one, when each one so attaining said age shall respectively receive on his or her part both principal and inter ' est. In case of the death of either of said children before attaining said age, then his or her said portion shall go to and be held for said survivor or survivors in like proportions, subject to the restrictions and limitations hereinbefore expressed. I appoint Rev. George Burgess and Henry Barnard, 2d, Esq., to be trustees of this will, and in case of the refusal, resignation or death of either of them, I direct the judge of probate of the district of Hartford to fill the vacancy, and in every case my trustees shall give bonds, satisfactory to said judge, for a faithful execution of said trust.”
The petitioners are surviving legatees, and became of age as follows: Harriet, July 15, 1857 ; John Russ Burrows, September 13, 1859; Johanna Russ, March 9, 1860.
The testatrix at her decease owned fifty-three shares of the
On these facts there can be no doubt that the sale of the stock to Stuart was in trust for Mr. Russ ; and as Russ could not legally be the purchaser of property which' he owned as administrator, and which he himself sold, the sale was contrary to the policy of the law, and was a void sale, however fair and honest in fact it might have been, and would unquestionably have been set aside as constructively fraudulent, had
The case, we think, may safely be put upon the general statute of limitations, irrespective of the statute prescribing the time within which appeals from probate must be taken. The petitioners claim that an administrator is a trustee, and that, in chancery, statutes of limitation do not run in favor of trustees; and it is unquestionably true that while the trust is an open, continuing or acknowledged trust, statutes of limitation have no application. Before the settlement of his administration account, and while he is acting as administrator, he is a continuing trustee, the trust is executory, and statutes of limitation have no application to him, because in general in no fair sense is there a cause of action against him until he is called on to account, and until a cause of action accrues the statute does not commence running. But when he makes a final settlement of his administration account with the court of probate, then a cause of action does arise if there is any just ground of complaint against his account. He then openly attempts to discharge himself of his character of trustee, lays down the trust, and repudiates the idea of being any longer administrator in respect to the estate administered upon. If the statute does not then begin
Again, it is claimed that Mr. Russ by the purchase of the stock through the agency of Stuart became a trustee for the petitioners, and" that this is a continuing and still subsisting trust, and therefore not within the statute. But by the whole current of modern authorities implied trusts are within the statute, and the statute begins to run from the time the wrong was committed by which the party becomes chargeable as trustee by implication. This subject has been fully examined in Kane v. Bloodgood, 7 Johns. Ch., 90, and by Judge Story in Robinson v. Hook, 4 Mason, 152, and a reference to these cases is sufficient.
But a more difficult question arises upon the report of the committee, on the further claim of the petitioners, that an actual, as distinguished from a constructive or legal fraud, was committed upon them by Mr. Russ ; and that this fraud was concealed from them until after the statute of limitations had attached to the claim; and that, in a court of equity, the statute of limitations ought not to be allowed to protect a fraud of this sort. And the case of Phalen v. Clark, 19 Conn., 421, is relied upon in support of this claim. We have no disposition to dispute this doctrine as established by the authority of that case, although the principle ought not, we think, to be extended. Where fraud is concealed for the purpose of taking advantage of the statute of limitations there
The committee, we have remarked, do not find actual fraud. If it existed the court must infer it from the facts reported by the committee. Now the interposition of Stuart as a sham purchaser is relied upon by the petitioners as an important item of evidence to show the fraud. Undoubtedly it is evidence favorable to the petitioners on the point, but we think it is not of that conclusive nature that requires us to find the fraud upon it alone, or in connection with any other facts in the case. As administrator Mr. Russ could not transfer the stock directly to himself. The transfer to a friend, therefore, was natural as well as necessary, if the administrator intended to become the purchaser. Such purchases, though forbidden
The transaction was not at once openly recognized as a sale to the administrator, but the stock remained in the name of •Stuart until 1856. This undoubtedly is a suspicious circumstance. Still it may have arisen from the confidence which the parties reposed in each other, and from the mere neglect and inattention consequent upon the small value which the stock had at that time; and there may have been objects to be accomplished entirely unconnected with the matter in dispute. In the absence of all proof, and after the death of the parties has rendered any explanation impossible, we do not feel justified in saying that the failure,to re-transfer was intended to conceal the facts from the notice of the petitioners or their trustees ; especially after the express statement of the committee that they do not find any fraudulent or collusive combination between Stuart and Euss, or any concerted concealment of their acts, except what is inferable from the facts themselves, and that the administrator charged himself with the fair market value of the stock, and that the sale of assets to the amount of the value of this stock was necessary to pay debts and charges against the estate, and the sale of the stock in furtherance of that object. As the committee, with all the facts before them, and of course a much better opportunity to come to a correct result upon the subject than it is possible for us to have, have not seen fit to find actual fraud, we do not feel justified in .coming to a result to which they could
It is not, moreover, unworthy of notice on the question of fraudulent concealment, that the sale, to Stuart at its fair value was known to the trustees, and they made no objection to it whatever; and to allow them or the petitioners, after this lapse of time, to set the sale aside as fraudulent, is to allow them, at any subsequent time however remote, to take advantage of any fluctuation by which its value was increased, while they in any event obtain its full value at the time, -in the settlement of the administration account.
In respect to the dividend on this stock which Mr. Russ received, November 80th, 1842, it was received after the arrangement for the transfer of the stock was made, but before its final transfer on the books of the company. It was. openly receipted for on the books of the insurance company a few days before the settlement of the administration account. The claim in regard to it stands substantially on the same footing with the claim for the stock itself and the subsequent dividends. We think the petitioners’ remedy is,barred by the lapse of time, and so we advise the superior court. The opinion here expressed renders it unnecessary to consider the question of evidence whichihe respondents raised.
In this opinion the other judges concurred, except Dutton, J., who dissented.