Opinion
13044
December 23, 1930.
Before DENNIS, J., Williamsburg, August, 1928. Modified and affirmed and remanded with directions.
Action by the National Surety Co. against E.H. Carsten and others. Decree for plaintiff and the defendants appeal.
REPORT OF REFEREEBy order of his Honor, Judge M.M. Mann, bearing date February 28; 1927, this matter was referred to me as special referee to take testimony and to report to the Court my conclusion, both of law and fact. Pursuant to said order a reference was held by me on May 12, 1927, J.D. Gilland, Esq., appearing for the plaintiff and Messrs. Hinds Meadors, for the defendant, Robert Carsten. C.T. McDonald, guardian ad litem, for the infant defendant, James C. Carsten, was also present.
Mr. Gilland, as attorney for plaintiff, filed an affidavit that no notice of appearance, answer, or demurrer had been served upon him by the defendants, E.H. Carsten, Julia G. Carsten, and Pearl C. Carsten Baker, and that said defendants were in default.
The only answers to the complaint before me are the answers of Robert Carsten and C.G. McDonald, guardian ad litem for James C. Carsten, infant defendant.
While the defendant R.O. Beatty is not included in Mr. Gilland's affidavit of default, still there is nothing before me to show that he either answered the complaint or demurred thereto. Attached to the complaint is an affidavit of service showing that the summons and complaint was served upon the said R.O. Beatty on November 27, 1925.
The defendant Robert Carsten, on December 16, 1925, by his attorneys. Hinds Meadors, served an answer to the complaint and on the call of the case before me for a hearing, this defendant moved for leave to file an amended answer. Due notice of this motion was given plaintiff's attorney. It is my opinion that the amended answer of the defendant Robert Carsten, be allowed, and I so recommend.
The case at bar is a sequel to an action brought by R.O. Beatty against the National Surety Company, and to understand the present case it is necessary to review the facts in the former case.
On December 15, 1902, J.C. Carsten died intestate, leaving as his heirs at law and distributees, his father, C.G. Carsten, three brothers, C.C. Carsten E.H. Carsten and Robert Carsten, and a nephew, R.O. Beatty, an infant son of a predeceased sister. On January 9, 1903, C.G. Carsten applied for letters of administration of the estate of the said J.C. Carsten, and in his petition for same omitted to name R.O. Beatty as an heir at law and distributee of the said J.C. Carsten. C.G. Carsten was duly appointed administrator of the estate of J.C. Carsten, and the National Surety Company became surety on his bond. The estate was administrated without mention of R.O. Beatty, and the balance in hand, after paying expenses of administration and preferred claims, for distribution, was $8,129.53, which amount was divided equally between the father and three brothers, and the infant, R.O. Beatty, received nothing from said estate. C.G. Carsten was discharged as administrator of the estate of J.C. Carsten on February 17, 1904.
In 1911 C.G. Carsten died intestate, leaving as his heirs at law and distributees his widow, Julia C. Carsten, three sons, E.H. Carsten, C.C. Carsten, and Robert Carsten, and a grandson, R.O. Beatty. On February 3, 1911, E.H. Carsten applied for letters of administration of the estate of C.G. Carsten, and was duly appointed. On July 30, 1917, E.H. Carsten, as administrator of the estate of C.G. Carsten, filed with the Probate Court of Williamsburg County, his final return, showing that all the claims against the said estate had been paid in full and the balance in the hands of said administrator disbursed among the heirs at law as follows: Mrs. Julia Carsten, widow of C.G. Carsten, $468.18, and Robert Carsten, E.H. Carsten, R.O. Beatty and Mrs C. C. Carsten, each $233.09. R.O. Beatty and each of the others signed a receipt for the amount received as settlement in full of personal property of C.G. Carsten. On September 1, 1917, E.H. Carsten was discharged as administrator of the estate of C.C. Carsten.
In 1914, C.C. Carsten, a son of C.G. Carsten, then deceased, died, leaving in force his last will and testament dated November 29, 1914, whereby he did devise and bequeath to his wife, Pearl Carsten, all of his property, real and personal, for and during her natural life or for so long as she remains his widow, and at her death or marriage the property so devised was to go to his son James C. Carsten and his heirs forever. This will was regularly admitted to probate.
At the time of his death, C.G. Carsten was seized and possessed of 96 acres of land at Cades in Williamsburg County. On January 10, 1920, a suit for the partition and division of said tract of land was commenced in the Court of Common Pleas for Williamsburg County by Julia G. Carsten, E.H. Carsten, Pearl C. Carsten and R.O. Beatty as plaintiffs, against Robert Carsten and James C. Carsten, an infant, as defendants. This partition proceeding appears to be regular in all particulars and the rights of all parties properly adjudicated. In this action the defendant Robert Carsten set up improvements made by him with the consent of the other heirs at law of C.G. Carsten, said improvements being a dwelling house and other buildings, and asked that in the partition the lot on which said permanent improvements had been made be allotted to him, thereby giving him the benefit of said improvements which had been made at his own expense. This was done, partition of the premises made between heirs, and same was later confirmed by the Court.
By this partition Julia G. Carsten received 44 3/4 acres and a one-acre lot; E.H. Carsten received 19 2/5 acres and a one-acre lot; Pearl G. Carsten received for her natural life or widowhood 16 1/4 acres and a one-acre lot; R.O. Beatty received 9 2/5 acres and a one-acre lot; Robert Carsten received 21 3/4 acres and the one-acre lot upon which he had erected his dwelling house etc. By deed dated September 20, 1920, Julia G. Carsten conveyed her lands received by said partition to R.O. Beatty. Mrs. Pearl Carsten, widow of C.C. Carsten, since said partition has married one Baker, and consequently her son, James C. Carsten is now the owner in fee of the share that was allotted to her. The other heirs appear to still be in possession of lands allotted to each of them.
On October 22, 1923, R.O. Beatty brought his action against the National Surety Company, as surety on the bond of C.G. Carsten, as administrator of the estate of J.C. Carsten, deceased, on account of the devastavit committed by said administrator, in that the said R.O. Beatty, a nephew of the said J.C. Carsten, was an heir at law and distributee of the said estate of the said J.C. Carsten and was entitled to the distribution of the said estate, but was not allowed to do so under the administration of the said C.G. Carsten. In this action R.O. Beatty recovered judgment for the sum of $3,885.90, and said judgment has been affirmed by the Supreme Court of South Carolina. 132 S.C. 45, 128 S.E., 40.
On June 24, 1925, the National Surety Company settled this judgment by paying to R.O. Beatty the sum of $4,258.84.
On November 23, 1925, the National Surety Company commenced its action in the case at bar to recover from the defendants the amount it had to pay to R.O. Beatty on the judgment against it as surety on the bond of C.G. Carsten, administrator of the estate of J.C. Carsten.
Plaintiff, by its complaint, seeks to hold the estate of C. G. Carsten, deceased, to reimburse it for the sum of $4,258.84 paid to R.O. Beatty because of the devastavit of C.C. Carsten as set forth in its complaint. Also plaintiff seeks to hold E.H. Carsten and Robert Carsten personally liable to it because of their participation in the wrongful distribution of the estate of J.C. Carsten in that they each received, in addition to their share, one-fourth of what should have gone to R.O. Beatty. Also plaintiff seeks to hold the estate of C.G. Carsten and the estate of C.C. Carsten liable because of the participation of C.G. Carsten and C.C. Carsten, respectfully, in the wrongful distribution of the estate of J.C. Carsten, in that each had received, in addition to their own share, one-fourth of what should have gone to R.O. Beatty. Also plaintiff seeks to hold the estate of C.C. Carsten liable for the maladministration of C.G. Carsten as administrator of the estate of J.C. Carsten in so far as C. C. Carsten or his heirs participated in the estate of C. G. Carsten. Plaintiff also seeks to hold Julia G. Carsten as an heir at law and distributee of C.G. Carsten, and Pearl C. Carsten Baker as an heir at law and distributee of C.C. Carsten and C.G. Carsten, and James C. Carsten as heir at law and distributee of C.C. Carsten and C.G. Carsten, and R.O. Beatty as an heir at law and distributee of C.G. Carsten. The defendant Robert Carsten, by his amended answer, denies that he has sufficient information to form a belief as to the truth of the material allegations of the complaint, and sets up three defenses thereto, to wit: (1) That R.O. Beatty received his full share of the estate of J.C. Carsten, and that he (Robert Carsten) received no more of the estate of J.C. Carsten than he was entitled to; (2) that R.O. Beatty received his full share of the estate of C.G. Carsten, and was given one-third of the real estate by the widow of C.G. Carsten, which with his inherited one-sixth interest gave him a one-half interest in all of the real estate left by C.G. Carsten; (3) that on the lands allotted to Robert Carsten he has made permanent improvements and that said improvements should not be subject to a judgment under plaintiff's action.
As to the special defenses set up by the defendant Robert Carsten, I find that the first is not tenable. R.O. Beatty was unquestionably an heir at law and distributee of J.C. Carsten, deceased, and should have participated in the distribution of his estate. His name does not appear in the administration of the said estate by C.G. Carsten, nor do the records of same show that he received a penny of it. I find the allegations of the second special defense of Robert Carsten to be true.
As to the third special defense in the answer of Robert Carsten, I find that he made certain permanent improvements on the land now occupied by him, and which he received in the partition of the lands of C.G. Carsten, and that the value of the said improvements is $3,200.00. I find the value of the land without improvements to be $950.00
There are practically no disputed facts in this case, and a decision of the issues, as I see it, rests almost entirely on the question of estoppel and laches.
Can the plaintiff hold the estate of C.G. Carsten or the heirs at law of the said estate for the devastavit committed by C.G. Carsten while administrator of the estate of J.C. Carsten?
The defendant Robert Carsten did not set up estoppel in his answer, but by argument of his counsel makes the point that the plaintiff is estopped from maintaining its action against the estate of C.G. Carsten. They admit that a surety who has paid the debt of the principal is subrogated to the rights, remedies, securities, liens, and equities of the creditor for the purpose of obtaining his reimbursements from the principal debtor, but insist that plaintiff is only entitled to be substituted in the place of R.O. Beatty for the purpose of obtaining reimbursements from the estate of C.G. Carsten, and has no greater rights than R.O. Beatty had against the estate of C.G. Carsten at the time that R.O. Beatty brought his suit against said National Surety Company. If this connection is correct, then plaintiff has no case against the estate of C.G. Carsten.
Under the rule as laid down in Lites v. Addison, 27 S.C. 235, 3 S.E., 214; Scarborough v. Woodley, 81 S.C. 329, 62 S.E., 405, and other cases, I do not think it necessary to plead estoppel in order to rely on it.
Now what are the facts? C.G. Carsten, as administrator of the estate of J.C. Carsten, unquestionably committed a devastavit when he failed to look out for the interest of R. O. Beatty, a nephew of J.C. Carsten by his predeceased sister, and a grandson of the administrator. R.O. Beatty was a minor at this time. On February 18, 1911, C.G. Carsten died intestate, and his estate was administered on by E. H. Carsten. In this estate R.O. Beatty was recognized, and he participated in the division of both the personal and the real property. For his share of the personal property he signed a receipt and acknowledged same as a settlement in full. R.O. Beatty was one of the plaintiffs in a suit for the partition of the 96 acres of land left by C.G. Carsten. So far as the proceeding in that case shows, Beatty was at that time of legal age. In the administration of the personal estate in the Probate Court, and in the partition of the real estate in the Common Pleas Court, no claim was made against the estate of C.G. Carsten by R.O. Beatty for the amount he should have received from C.G. Carsten as administrator of the estate of J.C. Carsten, representing his distributive share therein, or because of the devastavit committed by the said C.G. Carsten as administrator of the said estate.
No claims having been made by R.O. Beatty against the estate of C.G. Carsten for the devastavit committed in his management of the estate of J.C. Carsten, the estate of C. G. Carsten was divided and has descended to the lawful heirs of C.G. Carsten. Could R.O. Beatty, after having participated in the distribution of the estate of C.G. Carsten as an heir at law, and having filed no claim for, or raised the question of the liability of C.G. Carsten or his estate to him for money had and received from the estate of J. C. Carsten or for the devastavit by C.G. Carsten as administrator of said estate, bring suit against the heirs at law of C.G. Carsten, individually, or the estate of C.G. Carsten, three years after participating in the distribution of said estate of C.G. Carsten and after the discharge of the administrator?
It is my opinion that R.O. Beatty by his acts in participating in the division of the estate of C.G. Carsten and his failure to make claim against said estate for money had and received by C.G. Carsten from the estate of J.C. Carsten and for the devastavit of his intestate as administrator of said estate, was, at the time he brought his action against the National Surety Company, estopped from bringing an action against the estate of C.G. Carsten or those who had inherited said estate, on account of said devastavit of C.G. Carsten, for money had and received by him from said estate. If R.O. Beatty could not bring his action against the estate of C.G. Carsten, or those who inherited said estate, then can the National Surety Company its present action? Are all its rights any greater than Beatty's? I do not think so. It is my opinion that the plaintiff is estopped from maintaining its action against the estate of C.G. Carsten or against those who inherited same. The reasons which have guided me in the opinion that I have reached were not considered in the case of R.O. Beatty v. National Surety Company, either on circuit or in the Supreme Court, and the conclusions that I have reached I do not think are in conflict with that case as decided by the Supreme Court 132 S.C. 45, 128 S.E., 40. I think my reasoning follows the rule as stated in Bartell v. Edwards, 113 S.C. 217, 102 S.E., 210.
The next question is whether or not plaintiff is entitled to judgment against Robert Carsten on account of his personal participation in the distribution of the estate of J.C. Carsten. The record of the Probate Court shows that he did participate in this estate and received $2,032.38 as his share; he receiving the same as C.G. Carsten, E.H. Carsten and C.C. Carsten. There was testimony by Robert Carsten that he only got $1,200.00 from the estate of J.C. Carsten, but I think this testimony incompetent, as it contradicts the records of administration of said estate. I find as a matter of fact that Robert Carsten received $2,032.38 from the estate of his brother, J.C. Carsten. I also find that R.O. Beatty's share in said estate of J.C. Carsten was $1,625.90, and that Robert Carsten got $406.48 that would have gone to R.O. Beatty if the estate had been properly administered. Robert Carsten, according to the probate records in the case of the estate of J.C. Carsten, receipted G.C. Carsten, administrator, on January 15, 1904, for $2,032.38.
The plaintiff, who seeks to subrogate itself to the rights of R.O. Beatty, can have no higher rights than Beatty had. Therefore the question here arises whether or not Beatty could have on October 22, 1923, brought suit against Robert Carsten for the money had and received by him on January 15, 1904, from C.G. Carsten, administrator of that estate. The plaintiff alleges fraudulent conspiracy between C.G. Carsten, the administrator, and Robert Carsten, E. H. Carsten, and C.C. Carsten to deprive R.O. Beatty of his distributive share of the estate of J.C. Carsten. No testimony was offered to prove the allegations of fraud. It does appear, however, that C.G. Carsten, grandfather of R.O. Beatty, reared that youth in his home. I cannot believe that the grandfather and the uncles of R.O. Beatty conspired to defraud him, and the question of fraud goes out of the case.
There being no fraud, it was necessary for R.O. Beatty to bring his action against the other heirs at law who received his share of the estate of J.C. Carsten within the time allowed by statute for such action. Did he do this? Beatty did not elect to bring his action against either or any of his co-heirs who participated in the wrongful distribution of the estate of J.C. Carsten, but instead brought his action against the National Surety Company only. This action was commenced October 22, 1923. The age of Beatty at that time does not appear definitely in the evidence before me, but it does appear that on January 12, 1920, he joined himself as a plaintiff in an action for partition of certain real estate owned by himself and others as tenants in common as heirs at law of C.G. Carsten, deceased. It is therefore a legal assumption that he was 21 years of age on January 12, 1920, when said action was commenced. It was not until October 22, 1923, almost four years later, that he brought his action against the National Surety Company, and he must have been at that time at least 25 years old. If the limitations as fixed by Section 342 of Volume 1, Code of Laws of South Carolina 1922, apply in this instance, then Beatty's right of action for money had and received by Robert Carsten in 1904, became barred by the statute about the year 1921. If Beatty was of age on January 12, 1920, and he must have been to have brought his action for partition as already referred to, then his infant disability had ceased on January 12, 1920, and the extended time of one year after disability ceases as allowed by said Section 342 was up by January 12, 1921, at the latest. It is therefore my opinion that R.O. Beatty was barred in 1923 from bringing an action against Robert Carsten for money had and received in the unlawful distribution of the estate of J.C. Carsten. And, if R.O. Beatty was barred, then it follows that the National Surety Company is also barred.
The statute of limitations was not pleaded by Robert Carsten in his answer. The case at bar, however, is an action in the Court of Equity, and has been so considered by both sides throughout the trial. On the law side of the Court, if the statute of limitations was pleaded on similar facts as this case, plaintiff's action would be barred; and, if Beatty would be barred on the law side of the Court by the Statute, then in the Court of Equity he will be barred by laches, even though same was not pleaded by answer. I think this position is sustained by Cook v. Knight, 106 S.C. 310, 91 S.E., 312.
It is my opinion that R.O. Beatty, at the time he brought his suit against the National Surety Company, was not only estopped by his act and conduct, but was also barred by laches, from maintaining an action against the estate of C. G. Carsten, or any of his heirs, either on account of the devastavit of C.G. Carsten or because of money had and received by C.G. Carsten from the estate of J.C. Carsten. And as a matter of course what applies to the estate of C. G. Carsten will also apply with equal force to the case against Robert Carsten and all other defendants.
The views I have expressed and the conclusions I have reached I do not think are in conflict with the decision of the Supreme Court of the case of Beatty v. National Surety Company. The questions that I think control the case at bar and on which I based my conclusions were not raised in the case of Beatty v. National Surety Company.
This being an action in equity, my findings of fact and conclusions of law should apply not only to Robert Carsten and James C. Carsten, the two defendants who answered, but to the cause of action against all the defendants. This is a case in which plaintiff cannot get judgment on affidavit of default without formal proof of the allegations of the complaint.
As I see it, plaintiff has no cause of action against any of the defendants, and the complaint should be dismissed.
All of which is respectfully submitted.
DECREE OF JUDGE DENNISThis is a proceeding in equity, in rem, and in personam, commenced in the Circuit Court of Common Pleas for Williamsburg County by the National Surety Company, Inc., as plaintiff, against E.H. Carsten et al., as defendants, for the purpose of subjecting lands descended to the payment of the ancestor's debt. The proceeding was commenced by the filing of the lis pendens on October 24, 1925, and personal service of the summons and verified complaint on the defendants, E.H. Carsten, Robert Carsten, Julia G. Carsten, Pearl C. Carsten Baker, and James C. Carsten on November 25, 1925, and on the defendant R.O. Beatty on November 27, 1925. On November 25, 1925, the plaintiff served notice on the infant defendant, James C. Carsten, who was over 14 years of age, to procure the appointment of a guardian ad litem to appear and defend this action in behalf. The infant defendant having failed to apply for the appointment of a guardian at litem, on December 18, 1925, the plaintiff applied to the Court for the purpose and on December 18, 1925, Judge John S. Wilson, resident Judge of the Third Judicial Circuit, issued an order appointing C.T. McDonald, Esq., of Florence, S.C. as guardian ad litem for the infant defendant, James C. Carsten, and the said C.T. McDonald, Esq., accepted the trust. On December 19, 1925, the infant defendant, James C. Carsten, by his guardian ad litem, C.T. McDonald, Esq., filed the usual answer by a guardian ad litem. On December 17, 1925, the defendant R.O. Beatty, by his counsel, P.H. Arrowsmith, Esq., filed a demurrer to the complaint upon seven grounds as therein stated and as hereinafter fully set forth. After hearing J.D. Gilland, Esq., counsel for the plaintiff, and P.H. Arrowsmith, Esq., counsel for the defendant R.O. Beatty, Judge E.C. Dennis, presiding Judge of the Court of Common Pleas for Williamsburg County, issued his order, dated August 16, 1926, overruling the demurrer as will more fully appear by said order hereinafter set forth. The defendant, R.O. Beatty did not thereafter appear by answer or otherwise in this proceeding, and has been in default since August 16, 1926. On December 16, 1925, the defendant Robert Carsten, by his counsel, A.C. Hinds, Esq., filed his answer as hereinafter set forth. On February 28, 1927, Judge M.M. Mann, presiding Judge of the Third Judicial Circuit, issued an order of reference by which it was referred to P.H. Stoll, Esq., as special referee to take testimony and report to the Court his conclusions both of law and fact and to do any and all other things herein and within the jurisdiction and authority of referees of the Court. On May 6, 1927, counsel for the defendant Robert Carsten served notice on plaintiff's counsel of a motion before P.H. Stoll, Esq., referee, for an order allowing the amended answer to be filed, which amendment is hereinafter fully set forth. On May 12, 1927, a hearing in the cause was held before P.H. Stoll, Esq., as special referee. On June 30, 1927, the referee filed his report as hereinafter fully set forth. On August 16, 1927, the plaintiff filed twenty-two exceptions to the referee's report, as are hereinafter fully set forth.
On account of the disqualification of the resident Judge of the Third Judicial Circuit as the result of illness and by consent of counsel, this cause came on to be heard before me at Darlington, S.C. upon the plaintiff's exceptions to the referee's report and the entire proceedings in the cause. The pleadings and proceedings in this cause are extraordinarily voluminous, and considerable time has been required in the study of the case and of the law and authorities cited by counsel.
Plaintiff's exceptions numbered 1, 2, 3, 5, 10, 11, 12, 13, 14, 15, 16, 20, 21, 22, are sustained. Exceptions 4, 6, 7, 9, and 18 are overruled. The others are too general. The referee's report is modified in accordance with the plaintiff's exceptions thereto as hereinabove sustained and wherever the report is in conflict with the findings of fact and conclusions of law by the Court in this decree. I hold that the material allegations of the complaint are substantially true, and for the purpose of this decree the Court adopts as its conclusions of fact the allegations of the complaint, which have been fully established by the voluminous documentary evidence and oral testimony adduced in the cause.
The answer of the defendant Robert Carsten admits as true a great many of the material allegations of the complaint, and denies some of the other material allegations upon the ground that he has not knowledge or information sufficient to form a belief as to the truth of such allegations, and denies positively a few of the allegations of the complaint. I am convinced that the proof adduced by the plaintiff has established the material allegations of the complaint, a great many of which are founded upon previous judgments of the Court, which cannot be collaterally impeached in this proceeding. The answer of Robert Carsten further alleges as special defenses that Beatty received his full share and portion of the property belonging to the estate of the late J.C. Carsten. The records in the Probate Court of Florence County and the decision of the Supreme Court in the case of Beatty against the National Surety Company conclusively hold to the contrary, and these judgments are res adjudicata on that issue. Robert Carsten further asserts that he received no more than his distributive share of said estate, but he is estopped from successfully asserting this position by the record in the Probate Court of Florence County in the administration of the estate of J.C. Carsten, deceased, in which Robert Carsten actively participated. Robert Carsten further asserts by his answer that even if he had received more than his distributive share of the estate of J.C. Carsten, deceased, yet he would not be liable to his co-defendant R.O. Beatty, who received his full share and portion of the estate of C.G. Carsten and also received as a gift from the widow of C.G. Carsten the one-third portion of the real estate of C.G. Carsten allotted to his widow, and for that reason the said R.O. Beatty would be liable to the extent of the proportionate part of the estate of C.G. Carsten inherited by him and also the proportionate part of said estate of C.G. Carsten allotted and set apart to the widow of the said C.G. Carsten. The evidence in the cause unquestionably defeats this contention. Robert Carsten further asserts that Beaty could not have legally recovered from the National Surety Company more than one-half of the amount of the judgment that he did recover. This contention is defeated and concluded by the judgment. Robert Carsten further asserts as a special defense the betterments and improvements constructed and erected by him on that portion of the lands allotted to him in the partition of the real estate of C.G. Carsten, deceased, but the Court holds that this is not a good and valid defense for the reasons hereinafter assigned.
On the question of laches and estoppel and in order to intelligently present the antecedents in this case, it is appropriate for the Court to include in this decree a chronological statement of the previous events, judgments, and judicial proceedings adduced in evidence.
Chronological statement:
December 12, 1902. C.H. Carsten died intestate in Florence, S.C.
January 9, 1903. C.G. Carsten qualified as administrator of the estate of J.C. Carsten, deceased, in the Probate Court of Florence County.
January 9, 1903. National Surety Company, Inc., qualified as surety on the statutory bond of C.G. Carsten as administrator of the estate of J.C. Carsten, deceased.
February 17, 1904. C.G. Carsten, as administrator of the estate of J.C. Carsten, deceased, filed his final return in the Probate Court of Florence County and was discharged of the trust.
February 18, 1911. C.G. Carsten died intestate, and his estate was administered in the Probate Court of Williamsburg County.
December 27, 1914. C.C. Carsten died intestate and his estate was administered in the Probate Court of Williamsburg County.
January 20, 1920. Julia G. Carsten et al., as plaintiffs, commenced suit in the Court of Common Pleas in Williamsburg County against Robert Carsten et al., for partition of the lands of the estate of C.G. Carsten, deceased.
April 26, 1920. Return of commissioners in partition in above suit was confirmed.
June 30, 1923. R.O. Beatty, as plaintiff, commenced an action in the Court of Common Pleas in Florence County against the National Surety Company and the heirs of the estate of C.G. Carsten, deceased, to recover his portion of the estate of his uncle, J.C. Carsten, deceased. All of the heirs defaulted.
September 22, 1923. Complaint dismissed in the above-entitled suit on demurrer filed by National Surety Company.
October 22, 1923. R.O. Beatty, as plaintiff, commenced suit in the Court of Common Pleas in Williamsburg County against National Surety Company, as defendant, to recover his portion of the estate of his uncle, J.C. Carsten, deceased.
April 29, 1924. R.O. Beatty obtained a jury verdict by the direction of the Court against the National Surety Company for the sum of $3,885.90. and costs on account of the devastavit of C.G. Carsten, as administrator of the estate of J.C. Carsten, deceased.
May 7, 1925. Judgment affirmed by Supreme Court of South Carolina, 132 S.C. 45, 128 S.E., 40.
June 24, 1925. National Surety Company paid the amount of the judgments and costs in the sum of $4,258.84 to R. O. Beatty.
November 25, 1925. National Surety Company, Inc., as plaintiff commenced suit in the Court of Common Pleas in Williamsburg County, against E.H. Carsten et al., as defendants, as heirs of the estate of C.G. Carsten, deceased, to obtain satisfaction of the debt paid by the surety on account of the devastavit of the principal by a sale of the lands descended to the estate of C.G. Carsten, deceased, the defaulting administrator, then in the possession and control of the heirs of said estate, and for other relief as alleged in the complaint.
From the foregoing chronological statement it will be seen that the judgment on the administrator's bond against the National Surety Company was paid on the 24th of June, 1925, and this suit was commenced on the 25th of November, 1925, only five months after the judgment was paid by compulsion under judicial process. The vital question in this proceeding arises as to when the National Surety Company had a right of action against the heirs and lands descended of the estate of C.G. Carsten, deceased, to obtain satisfaction of the debt it paid for the principal. The surety's right of action only accrues on the payment of the debt, and the statute of limitations then commences to run, as is established by the decisions of the Supreme Court of South Carolina in the following cases, to wit: Jacob Peters v. John Barnhill, 1 Hill, 234; Legare O'Hear v. Fraser, 3 Strob., 380; Sims v. Goudelock, 6 Rich., 105; Hellams v. Abercrombie, 15 S.C. 117, 40 Am. Rep., 684; Noble v. Cothran, 18 S.C. 442; McCrady v. Jones, 44 S.C. 411, 22 S.E., 414; Costelo v. Cave, 2 Hill, 531, 27 Am. Dec., 404; Commercial Bank v. Bobo, 9 Rich., 36; Lynch v. Hancock, 14 S.C. 92; Bolt v. Dawkins, 16 S.C. 198.
The National Surety Company paid the judgment obtained against it by Beatty on the 24th of June, 1925, and after that date it had six years within which to commence this proceeding against the heirs and lands descended of the estate of C.G. Carsten, deceased, to satisfy the debt it paid for the principal. This seems to be the universal rule in all jurisdictions, but, inasmuch as the South Carolina decisions are wholly sufficient for the purpose, it is unnecessary to resort to the decisions of other jurisdictions in support of this principle. The case of Peters v. Barnhill, supra, is so nearly analogous and so much in point with the instant proceeding as to dates and limitations that the Court quotes therefrom as follows: "Dickson recovered his judgment against the plaintiff in 1816, and it was satisfied in 1830, so that, notwithstanding the note was dated in 1804, the plaintiff's right of action did not accrue until 1830, when he paid the debt; and it will not be pretended that the presumption of payment would arise since that time. The statute is not pleaded [as in the instant case], and the action was brought within four years thereafter." The Court quotes further from the opinion of Justice O'Neall, concurred in by Justices Johnson and Harper, as follows: "The strange proceedings, had in the case of Dickson v. Barnhill Peters, have created all the difficulties on this part of the case. How on a joint and several contract, in a joint action, a verdict for one, and against another, of the makers, could ever have been rendered, I am at a loss to conjecture; but the fact appears to be so, and we must now give legal effect to the judgment rendered upon the verdict in favor of the defendant. Does it conclude the present plaintiff from showing that the debt upon which judgment was obtained against him and which he has paid, was the debt of the defendant? Judgments are generally conclusive as between parties and privies in law or estate. The plaintiff cannot be regarded as a party to the judgment in favor of the defendant. For, as to that, the only parties were the then plaintiff Dickson, and the defendant Barnhill. He was in no sense a privy to it. It could neither charge nor discharge him. He cannot, therefore, be now prejudiced by it. The effect of the judgment must be the same as if Dickson had brought separate actions against each of the makers, and had recovered in the action against the security, but had failed in that against the principal. In such a case, it would not be contended that the judgment, in the case between the principal and payee, would conclude the security from showing that the debt paid, under the recovery against him, was the debt of his principal."
"Although the debt has been barred by limitations as against the principal, yet judgment may be entered against the surety if he remains liable thereon — in cases where suit may be maintained against the surety without joining the principal — and if the surety pays the debt which is at the time barred by limitations as against the principal, but is a valid obligation against the surety, such surety may recover against the principal, or against his estate in case of his death. The right of action in favor of the surety arises when he pays the debt, and is not based upon the original debt itself, but upon the implied contract which exists by law between the principal and surety in such cases." 21 R.C.L., 1104; Peaslee v. Breed, 10 N.H. 489, 34 Am. Dec., 178; Faires v. Cockerell, 88 Tex., 428, 31 S.W. 190, 639, 28 L.R.A., 528; Willis v. Chowning, 90 Tex., 617, 40 S.W. 395, 59 Am. St. Rep., 842; Note, 134 Am. St. Rep., 564, 565.
"The action at law by a surety to recover from the principal the amount of money which he has been compelled to pay on account of the debt is not based on the doctrine of subrogation, and hence the principles applying to the latter class of cases are not applicable to such an action, but on the payment of the principal debt by the surety a new and distinct debt based on an implied promise is created as between the principal and surety for the money paid. This right of the surety to recover at law from the principal the amount paid by him on the principal debt arises at once regardless of whether he obtains possession of the bill, note or other obligation, evidencing the debt." 21 R.C.L., 1106.
"The statute of limitations begins to run against a surety who, having paid the debt of his principal, seeks to recover reimbursement, not from the time when the principal debtor became liable, but only from the time the surety made the payment." 21 R.C.L., 1122, and citations.
The plaintiff is seeking relief from actual fraud perpetrated by the administrator and his heirs, as established by the evidence, which fraud was not discovered by the plaintiff until the 7th of May, 1925. It is unnecessary to cite authorities in support of the well-established and fundamental principal of law that the plaintiff has a right to bring an action for fraud within six years from the date of discovery, and in this instance the plaintiff would have a right to bring this proceeding within six years after May 7, 1925.
The defendant's counsel contends that the plaintiff in this proceeding is estopped by the receipt signed by R.O. Beatty in the partition suit of the estate of C.G. Carsten, deceased. The defendant's contention is untenable under the principles of law and equity as hereinafter announced.
The plaintiff in this proceeding was not a party to the partition suit, and there was an entire and absolute want of mutuality upon which an estoppel could be based, inasmuch as "an estoppel must be mutual and reciprocal, that is, it must bind both parties, and generally, therefore, it can operate neither in favor of nor against strangers." 10 R.C. L., 839.
There is nothing in the record or receipt in the partition suit, nor in the evidence in this case, that, when Beatty signed the receipt for his portion as an heir of the estate of C.G. Carsten, deceased, he had full knowledge of the facts and his rights as claimant against such estate as the result of the default of C.G. Carsten in the administration of the estate of J.C. Carsten, deceased, that he had an intent to mislead, or at least a willingness that others should be deceived, and that any other party was misled by his attitude. 10 R.C.L. p. 693, "Estoppel," § 21, and citations.
Where one of two innocent persons, that is, persons each guiltless of an intentional moral wrong, must suffer a loss, it must be borne by that one of them who by his conduct has rendered the injury possible. 21 R.C.L. p. 695, "Estoppel," § 23; City Council of Charleston v. Ryan, 22 S.C. 339, 53 Am. Rep. 713; and numerous other decisions. Assuming that all parties are innocent of an intentional moral wrong, if C.G. Carsten, Robert Carsten, and the other heirs of the estate of J.C. Carsten, deceased, had not conjointly participated in the unlawful divisions of the assets of that estate to the exclusion of Beatty, then this situation would not have arisen, and C.G. Carsten, and the other heirs of the estate of J.C. Carsten, deceased, who made the unlawful division of that estate and left out Beatty, are the parties responsible for the loss sustained by the surety, who was innocent of the fraud and did not discover it until it was forced to pay Beatty; therefore, under the rule, Robert Carsten and the other heirs of the estate of J.C. Carsten, deceased, should suffer the loss.
The burden is on the party asserting the estoppel, and the defendant Robert Carsten has failed to prove that Beatty was not ignorant of his rights when he signed the receipt in the partition suit.
There is no proof by Robert Carsten that any person was misled to his injury by the receipt signed by Beatty in the partition suit. The burden is on Robert Carsten to prove the injury.
The plaintiff in this case is certainly not estopped by the records, acts, admissions, or what not of Beatty in the partition suit, because the issue was not raised in the partition suit, the surety was not a party to that suit, the issues are entirely different, and the parties are entirely different. 10 R.C.L. p. 702, "Estoppel." § 29.
There is nothing in the receipt signed by Beatty in the partition suit containing the elements of estoppel such as false representations or concealment, knowledge of facts, absence of knowledge, or adverse party, intent that adverse party act thereon, and reliance and action by adverse party to his prejudices, and there is nothing in the evidence to prove these elements. W.S. Gray Cotton Mills v. Spartanburg County Mills, 139 S.C. 223, 137 S.E. 684.
If the surety and Robert Carsten were both innocent and must suffer a loss by the wrongful act of Beatty, then Robert Carsten, who was at fault in producing the situation by participating in the wrongful distribution of the estate of J.C. Carsten, deceased, must suffer the loss, as he and not the surety is at fault. Leaphart v. Selby, 135 S.C. 1, 133 S.E. 451; Land v. Reese, 136 S.C. 267, 134 S.E., 252; Davis v. Bland, 138 S.C. 354, 136 S.E. 300; Epps v. McCallum Realty Co., 139 S.C. 481, 138 S.E. 297; Mortgage Acceptance Corp. v. Stewart, 142 S.C. 375, 140 S.E. 804.
Robert Carsten cannot take advantage of his own wrong in the lawful distribution of the estate of J.C. Carsten, deceased, which was the proximate cause of the loss to the surety, because such a position would be repugnant to equity and justice. Butler v. Spencer, 116 S.C. 177, 107 S.E. 154.
An admission made by a creditor of a decedent's estate that his claim would not exceed a certain amount does not estop him from presenting and proving by competent testimony his real claim. Such admission will merely militate against his credibility and the bona fides of his accounts. In re Shuman's Estate, 45 Pa. Super., 587.
The omission of Beatty to assert his right against the estate of C.G. Carsten, deceased, on account of his rights in the estate of his uncle, J.C. Carsten, deceased, when he signed the receipt in the partition suit for his part of the estate of C.G. Carsten, deceased, as an heir of that estate and not as an heir of the estate of J.C. Carsten, deceased, from ignorance of his rights, does not constitute an estoppel. Scaife v. Thomson, 15 S.C. 337.
As to the deed from Julia G. Carsten to Beatty, there is nothing in the evidence to show that the consideration of the deed was the satisfaction of Beatty's claim against the estate of C.G. Carsten, deceased, for his interest in the estate of J.C. Carsten, deceased, and the burden was on Robert Carsten to prove such a consideration as an estoppel against Beatty. Furthermore, the defendant would have to prove that the surety had knowledge of such an alleged fact, was a privy to the transaction, and benefited by the result thereof, and there is absolutely no evidence in support of these facts.
In the case of Howard v. Kirton et al., 144 S.C. 89, 142 S.E. 39, the Supreme Court prescribed the modern method of recovering betterments under the provisions of the Civil Code 1922, §§ 5296-5300, 5303, and 5304, which must be followed, since such statutes recognized equitable right and gave remedy for its enforcement not before existing.
If the defendant in this proceeding should be successful in asserting his claim for betterments and improvements, it is inconceivable to the court how he could possibly profit by such success as against the superior right of the plaintiff, because under the decision of the Supreme Court in the Howard v. Kirton case this Court would have to order the claim of the plaintiff to be paid in full first out of the proceeds of sale before the defendant would be entitled to any of the proceeds to be derived from the sale for betterments and improvements.
Under the case of Tumbleston v. Rumph et al., 43 S.C. 276, 21 S.E. 84, the defendant in this proceeding would not be entitled to recover for betterments and improvements because the defendant has failed to allege in his answer and prove by competent evidence that the defendant believed at the time he made such betterments or improvements that his title thereto was good in fee as required by the statute, Section 5301 of the Code of 1922. Robert Carsten testified that he made the improvements on the property before the partition of the lands of C.G. Carsten, deceased, and of course before he had any title thereto or any right to believe that at the time he made such improvements or betterments his title thereto was good in fee. Under this testimony the defendant cannot recover for improvements and betterments under the decision of the Supreme Court in the case of Tumbleston v. Rumph et al., supra.
In accordance with the general rule, it is usually held that an occupant is entitled to compensation for his improvements when and only when he has been a bona fide possessor and has made the improvements in good faith, believing his title to be a legal one, but an occupant who holds in bad faith is not entitled to any compensation for improvements. Tumbleston v. Rumph et al., supra. As a general rule, an occupant of land is not a possessor in good faith, and hence is not entitled to compensation for improvements which he makes thereon after he has notice or knowledge that his title is defective, as where he has knowledge of an adverse title or claim to the property in another. Dellet v. Whitner, Cheves, Eq. (15 S.C. Eq.) 213; Belton v. Briggs, 4 Desaus. (4 S.C. Eq.) 465; De Braham v. Fenwick, 1 Desaus. (1 S.C. Eq.) 114.
I do not see how Robert Carsten can put himself within the rule as to a bona fide possessor without notice of an adverse claim to the property when the evidence in this proceeding conclusively established the fact that he knew that R.O. Beatty was entitled to one-fifth part of the estate of his uncle, J.C. Carsten, deceased, in 1902, and that he did not receive his portion of said estate in the distribution thereof in the administration in the probate court of Florence County according to the records thereof, and in the circumstances the court is constrained to hold under the evidence in this proceeding that Robert Carsten never has been a bona fide possessor without notice of the adverse claim of R.O. Beatty, and therefore is not legally or equitably entitled to recover for any improvements or betterments that he made on the property formerly belonging to the estate of C.G. Carsten, deceased.
It appears by the records that on the 21st day of September, 1920, R.O. Beatty conveyed by deed, for a consideration of $400 to Victor L. Arnette, two lots designated as Nos. 3 and 4, on a plat made by P.G. Gourdin, surveyor, dated the 31st of March, 1920, surveyed and partitioned by the direction of commissioners appointed in the case of Julia G. Carsten et al., against Robert Carsten et al., which lots measure 40 feet front each along the street running parallel with the right of way of the Atlantic Coast Line Railroad and running back in depth 272 feet, and that said deed was recorded the 27th day of October, 1920, in Book A-16 of the records of conveyances for Williamsburg County at page 298. It appears that these two lots were sold to Arnette as an innocent purchaser for value without notice, and for that reason they are excluded from the lands descended of the estate of C.G. Carsten, deceased, as hereinafter more fully described and herein ordered to be sold.
Now, therefore, it is ordered, adjudged, and decreed that the plaintiff, National Surety Company, Inc., have judgment against and do recover from the estate of C.G. Carsten, deceased, the sum of $5,540.69, with interest thereon from the date of this decree at the rate of 7 per cent. per annum, and the costs and expenses of this proceeding and it is further ordered, adjudged, and decreed that the plaintiff, National Surety Company, Inc., have judgment against and do recover from each of the defendants estate of C.G. Carsten, deceased, estate of C.C. Carsten, deceased, E.H. Carsten, and Robert Carsten the sum of $1,385.17 with interest thereon from the date of this decree at the rate of 7 per cent. per annum, and for the costs and expenses of this proceeding; and it is further ordered, adjudged, and decreed that the plaintiff, National Surety Company, Inc., shall have a first lien, exclusive of taxes, over the lands descended of the estate of C.G. Carsten, deceased, as hereinafter more fully described and herein ordered to be sold for the satisfaction of the plaintiff's judgment and costs; and it is further ordered, adjudged and decreed that the extent of the recovery of the plaintiff under this decree shall be the sum of $5,540.69, with interest thereon from the date of this decree at the rate of 7 per cent. per annum, and the costs and expenses of this proceeding; and it is further ordered, adjudged, and decreed that the clerk of court of Williamsburg County, after the publication of notice of sale in the County Record, a weekly newspaper published at Kingstree, in Williamsburg County, once a week for three weeks, shall offer for sale at public auction to the highest bidder for cash on sales day, the first Monday in December, 1929, or on any subsequent sales day, without further notice, the premises hereinafter more fully described and herein ordered to be sold, that out of the proceeds to be derived from the sale of said premises that the clerk of said court shall pay first all taxes that may be assessed as a lien against said premises, second, the costs and expenses of this proceeding and of such sale, third, the plaintiff's judgment with interest thereon to the date of payment, and shall hold the surplus, if any, until further order of this court; and it is further ordered, adjudged and decreed that said clerk of court shall have the power and authority, as a condition precedent to the qualification of each prospective bidder, to require that each and every proposed bidder shall first deposit with said clerk the sum of $1,000 in cash, or the equivalent thereof, as evidence of good faith and to be forfeited as liquidated damages upon the failure or default of the successful bidder to promptly comply with the terms and conditions of said sale, and, in the event of the failure or default of the successful bidder to promptly comply with the terms and conditions of said sale, then the said clerk is hereby authorized, directed, and empowered to sell said premises in the same manner, at the same place, and upon the same terms, on the same or any subsequent sales day, without further notice and without the further order of this court, and at the costs and expenses of such defaulting bidder; and it is further ordered, adjudged, and decreed that, upon compliance with the terms and conditions of said sale by the successful bidder, that said clerk of court shall make, execute, and deliver his official deed conveying said premises to such successful bidder, and shall thereupon and thereunder put the purchaser into immediate possession of said premises.
The following is a description of the premises herein ordered to be sold, to wit: All that certain piece, parcel, or tract of land lying, being, and situate in the county of Williamsburg and state of South Carolina, measuring and containing 107 acres, more or less, and bounded on the north by the public road, leading from Cades to Hebron Church, on the east by lot of E.H. Carsten and A.C.L. Railroad Company, on the south by lands of Robert Carsten, and on the west by the public road leading from Kingstree to Lake City, and being the same lands allotted by commissioners to the heirs of the estate of C.G. Carsten, deceased, in the partition suit of Julia G. Carsten et al. v. Robert Carsten et al., as appears by judgment roll No. 2265 in the office of the clerk of court of Williamsburg County, excepting all those certain lots of land lying, being, and situate in the town of Cades, county of Williamsburg, and state of South Carolina, designated in red ink as lots Nos. 3 and 4 on a plat made by P.G. Gourdin, surveyor, dated March 31, 1920, surveyed and partitioned by direction of commissioners appointed in the case of Julia G. Carsten et al against Robert Carsten et al., said lots measuring 40 feet front each along the street running parallel with the right of way of the A.C.L. Railroad on the west and running back in depth 272 feet, the same being bounded on the north by lot No. 2 on said plat, east by street above referred to, west by tract No. 2 or land of Robert Carsten, and on the south by lot No. 5, said lots having been conveyed by R.O. Beatty to Victor L. Arnette by deed dated September 21, 1920, and recorded in the office of the clerk of court of Williamsburg County on October 27, 1920, in Book A-16 at page 298.
Messrs. Hinds Meadors, for appellants, cite: Subrogation: 37 Cyc., 363, 380, 402; 5 S.C. 342; 7 Rich., 399; 13 Rich. Eq., 269; 1 Hill Eq., 344; Rich. Eq. Cas., 172; 2 McC. Eq., 455; 88 So. 838; 218 Pac., 313; 217 Pac., 332; 126 S.E., 405; 234 S.W. 939; 95 S.E., 585; 147 N.E., 904; 213 N.W., 517; 91 Pa. Sup., 335; 139 Mass. 508; 117 U.S. 312; 17 N.Y., 428; 18 S.E., 104; 76 S.E., 670; 25 R.C.L., 1377; 41 L.Ed., 412; 29 L.Ed., 873; 66 A. S.R., 44; 99 A.S.R., 474; 136 S.C. 18; 108 S.C. 371; 278 Fed., 783. Surety cannot recover if principal discharged: 32 Cyc., 258; 47 N.E., 680; 18 A.S.R., 293; 90 Am. Dec., 412; 80 Am. Dec., 105; 43 Am. Dec., 405; 29 Am. Dec., 225; 74 Am. Dec., 541; 42 Am. Dec., 696; 45 Am. Dec., 493; 8 Am. Dec., 415; 7 A.L.R., 1014; 116 S.C. 177; Surety guilty of negligence will not be favored by equity: 116 S.C. 177; 120 S.C. 56. Not necessary to plead estoppel: 27 S.C. 238; 81 S.C. 332; 95 S.C. 338; 93 S.C. 193. Not necessary to plead laches: 106 S.C. 310. Commercial surety not a favorite of the law: 57 S.C. 466; 103 S.C. 68; 104 S.C. 171.
Mr. J.D. Gilland, for respondent cites: Defaulting defendants cannot appeal: 56 S.C. 28; 33 S.E., 787; 38 S.C. 556; 17 S.E., 21; 52 S.C. 307; 29 S.E., 726. Rights and remedies of surety against principal: Cheves 15; 1 Hill L., 233; 21 R.C.L., 1097-98. Principal liable to surety upon payment by surety: 21 R.C.L., 1106; 68 L.R.A., 508; 124 A.S.R., 566; 123 So., 271; 70 Ala., 326; 56 Ala., 481; 131 Ala., 658; 57 L.R.A., 212; 152 N.W., 75; Ann. Cas., 1917-C, 1070; 165 N.E., 588. Grounds on which heir can defend: 123 S.C. 252; 116 S.E., 279; 132 S.C. 45; 128 S.E., 40; 35 S.C. 578; 15 S.E., 281; 2 S.C. 140; Bailey Eq., 437; 9 S.C. 430. Waiver and estoppel: 151 S.E., 788.
December 23, 1930. The opinion of the Court was delivered by
The plaintiff, National Surety Company, Inc., commenced this action against the defendants, in the Court of Common Pleas for Williamsburg County, November 25, 1928, for the purpose of subjecting lands descended to the defendants to the payment of the ancestor's debt. Based on the allegations of the complaint, the plaintiff in the prayer of its complaint asked for judgment against ancestor's estate, C.G. Carsten, deceased, for the amount involved in the suit, for an order of sale of the said lands, and application of the proceeds of the sale to the alleged debt, and also for personal judgment against certain of the defendants, "by way of subrogation and contribution" for the amount involved, together with interest, and for such relief as the Court might deem just. All of the defendants, except the defendant Robert Carsten and the infant defendant, James C. Carsten, defaulted. Answers being filed on behalf of these defendants, the case was by order of Judge M.M. Mann, referred to P.H. Stoll, Esq., as special referee, to take the testimony and determine all issues, both of law and of fact. After taking the testimony, the referee filed his report, finding against the plaintiff's contention and in favor of the defendants, and recommended that the complaint be dismissed.
The plaintiff in due time filed exceptions to the referee's report, and the matter was then heard by his Honor, Judge E.C. Dennis, upon exceptions. His Honor, Judge Dennis, reversed the referee, issued an order to that effect, dated November 4, 1929, and ordered judgment in favor of the plaintiff against the estate of C.G. Carsten, deceased, for the sum of $5,540.69, and ordered personal judgment against each of the defendants, estate of C.G. Carsten, deceased, estate of C.C. Carsten, deceased, E.H. Carsten, and Robert Carsten, in the sum of $1,385.17. His Honor further ordered in his said decree that the plaintiff should have a first lien, exclusive of taxes, "over the lands described of the estate of C.G. Carsten, deceased," and decreed that the said lands be sold by the Clerk of Court of said County for the purpose of paying said indebtedness. From the order of Judge Dennis and the entry of judgment thereon, the defendants have appealed to this Court upon exceptions presented.
Since the referee's report and the decree of Judge Dennis, which will be incorporated in the report of the case, contain a clear statement of the issues involved, and also a chronological statement leading up to the commencement of the action, we shall omit making such statement here, and shall simply state our conclusion, based upon a study of the transcript of the case, without considering the exceptions separately and without entering into a discussion of the evidence disclosed by the transcript.
We agree with the conclusion of the Circuit Judge in so far as he ordered, adjudged, and decreed that the plaintiff, National Surety Company, Inc., should have a first lien, exclusive of taxes, over the lands described of the estate of C.G. Carsten, deceased, except as to the improvements made by defendant Robt. Carsten, and in ordering the said lands (described in the said decree) sold and the proceeds derived from said sale applied to the payment of the plaintiff's claim; and we also agree with his Honor in ordering, adjudging, and decreeing personal judgment against each of the defendants, as directed by his Honor.
We are unable to agree with his Honor, the Circuit Judge, in failing and refusing to provide for pay to the defendant Robert Carsten, for the improvements he placed upon the said lands ordered sold. Under our view of the case, this defendant placed improvements on the land in question in good faith, a heavy expense to him, not knowing that the plaintiff claimed or had any interest in the same, but regarded the land as the common property of the defendants and expected to get that portion allotted to him, with the consent of the other defendants, which was done in the partition that was had. Under the rules of equity and the evidence in the case we think this defendant should be allowed compensation for the improvements he placed on the land. We think that this defendant, Robert Carsten, should be adjudged and decreed to have a first lien, exclusive of taxes, against the lot of land on which he made the improvements for the same, and we so hold, and the said lot of land should be sold subject to such lien.
It is the judgment of this Court that the decree of his Honor, Judge Dennis, and the judgment entered thereon be modified in accordance with the views herein expressed, and in all other respects the same is hereby affirmed, and that the case be remanded for such further proceedings as may be necessary, not inconsistent with the views herein expressed.
MESSRS. JUSTICES BLEASE and STABLER and MR. ACTING ASSOCIATE JUSTICE SMITH concur.
MR. JUSTICE COTHRAN concurs in part and dissents in part.
This litigation grows out of the failure of a father, in the settlement of the estate of a son, to recognize the interest of a grandson as an heir at law of his uncle, the intestate, of whose estate the father became administrator.
The case is confusing on account of the omission of the first names of the parties and of the similarity of initials.
C.G. Carsten was the father of four sons and a daughter; the sons were J.C., E.H., C.C., R.C., and the daughter was ____, who had married one Beatty.
The son J.C. died in December, 1902, intestate, and the father, C.G., was appointed administrator of his estate. Prior to the death of the intestate, Mrs. Beatty, the daughter of C.G. and the sister of the intestate, had died leaving a son, R.O. Beatty, an only child, who upon the death of the intestate, J.C. became entitled as an heirs at law in the distribution of his estate to one-fifth; the heirs being the father, the three sons, and himself.
In January, 1903, the father qualified as administrator of the estate of J.C., and the National Surety Company became surety upon his administration bond.
In February, 1904, the father filed his final return as administrator of the estate of J.C. and was discharged. The final return showed that all claims had been paid and that the remainder of the personal property had been divided among those who were supposed by the administrator to be the sole heirs at law of the intestate, himself (the father) and the three brothers, C.C., E.H., and Robert (R.C.), each receiving and receipting for $2,032.39 in full settlement of their respective shares in the distribution. R.O. Beatty, nephew of the intestate, was entirely ignored in the distribution.
In 1911, the administrator, the father, C.G., died intestate, leaving as his heirs at law his widow, Julia, his sons, E.H., C.C., and Robert, and his grandson, R.O. Beatty. The son E.H., became administrator of his estate, divided the proceeds of the personal property among said heirs at law, and was discharged in 1913.
In 1914, the son C.C., died, leaving a will devising his property to his wife, Pearl, during her natural life or widowhood, remainder to his son, James. The widow has remarried, and the remainder to James has taken effect.
At the time of his death, the father, C.G., owned a tract of 96 acres at Cades in Williamsburg County, and in January, 1920, an action for the partition of this tract was brought by and against the heirs at law. Among the defendants was the son Robert (R.C.), who filed an answer alleging that about four years theretofore by and with the consent of his co-tenants and at their suggestion and upon their advice, at his own cost and expense, he built a dwelling house and other structures upon one acre of the tract adjacent to the right-of-way of the Atlantic Coast Line Railroad, which dwelling was constructed by him for a home for himself and family, and that it had been and was then being used by him as such, and asked that the 96-acre tract be divided among the parties entitled thereto in kind, and that the lot upon which he had constructed his dwelling be included within the portion allotted to him, giving him the benefit of the improvements made thereon at his own expense. The suit proceeded in the customary manner; the commissioners in partition were duly appointed; a writ in partition duly issued; the lands were divided, each of the co-tenants receiving a lot in the town of Cades and a tract of land extending beyond the town limits. Robert Carsten received the lot upon which he made the improvements, and the commissioners gave to him the benefit of the improvements made by him upon the lot. The report of the commissioners was duly confirmed by a decree signed by his Honor, Judge Rice, and dated February 23, 1920. Thereupon each of the parties took exclusive possession of his or her portion of the land allotted in the proceedings. Robert Carsten continued in the exclusive possession of the portion of his land from the date of division to the commencement of this action, and is still in possession of the same.
In September, 1920, the widow of the intestate C.G., Julia, conveyed to R.O. Beatty, in fee simple, all of the lands received by her in the division. Since then R.O. Beatty has been in possession of both the portion allotted to him and the portion allotted to Mrs. Julia G. Carsten.
In 1923, R.O. Beatty instituted an action against National Surety Company, as surety upon the administration bond of his grandfather, C.G., to recover his portion of the estate of his uncle J.C., his interest having been overlooked in the distribution and paid to the other heirs at law. This action resulted in a judgment in his favor, which was affirmed by this Court, 132 S.C. 45, 128 S.E., 40, and paid by the Surety Company, $4,258.84, in June, 1925.
In November, 1925, the Surety Company commenced the present action against E.H. Carsten et al., as defendants, as heirs of the estate of C.G. Carsten, deceased, to obtain satisfaction of the debt paid by the surety on account of the devastavit of the principal by a sale of the lands descended of the estate of C.G. Carsten, deceased, the defaulting administrator, then in the possession and control of the heirs of said estate, and for other relief as alleged in the complaint.
It does not appear in the record that any defendant other than Robert Carsten answered. He sets up three defenses, to wit, that R.O. Beatty received his full share of the estate of J.C. Carsten, and that he (Robert Carsten) received no more of the estate of J.C. Carsten than he was entitled to; that R.O. Beatty received his full share of the estate of C. G. Carsten and was given one-third of the real estate by the widow of C.G. Carsten, which, with his inherited one-sixth, gave him one-half interest in all of the real estate of C.G. Carsten; that on the lands allotted to him he has made permanent improvements, and that said improvements should not be subject to a judgment under plaintiff's action.
The case was referred to P.H. Stoll, Esq., as special referee, to hear and determine all issues. He reported recommending a dismissal of the complaint. Upon exceptions thereto, his Honor, Judge Dennis, reversed the referee's report and ordered judgment against each of the defendants, estate of C.G. Carsten, deceased, estate of C.C. Carsten, deceased, E.H. Carsten, and Robert Carsten in the sum of $1,385.17, adjudged that the National Surety Company shall have a first lien, exclusive of taxes, over the lands descended of the estate of C.G. Carsten, deceased, that the extent of the recovery of the plaintiff under the decree shall be the sum of $5,540.69, with interest thereon from the date of the decree at 7 per cent. per annum and the costs and expenses of the proceedings, and directed the land to be sold on the first Monday in December, 1929.
From this decree it appears that only the defendant Robert Carsten has appealed.
The decree of his Honor, Judge Dennis, is full, clear, logical and just; I think that it should be affirmed without modification. The opinion of Mr. Justice Carter suggests a modification of it to the extent of allowing Robert Carsten compensation for the improvements placed by him upon the lot which was assigned to him in the partition proceedings. Judge Dennis' disposition of this claim of Robert Carsten is entirely satisfactory to me.