Opinion
06-02-1890
DUNN v. CAMPBELL et al.
Samuel A. Benson, for complainant. Raymond P. Wortendyke, for demurrants.
On demurrer to bill.
The bill alleges that Anna K. Schmidt died on the 30th day of August, 1880, leaving a will, of which she appointed Gustavus B. Sanford and Theophilus C. Dunn the executors. By this will, after giving her household furniture to her two daughters, Amelia and Dora, Mrs. Schmidt directed that the proceeds of a policy of insurance upon her life should be divided so that $100 of it should be paid to one Mary Badger, and $900 of it should be divided equally between her own four children, Amelia, Dora, Edward, and Louis, and that the residue of her estate should be so divided that the two daughters should each have 32 per cent. of it, and the son Edward should have 25 per cent. of it, and the son Louis should have 11 per cent. of it. The complainant renounced the executorship, and Sanford alone proved the will. In April, 1882, Sanford's account was allowed by the orphans' court of Hudson county. In October, 1883, Sanford, being then a resident of New York city, died intestate, and afterwards Phebe E. Campbell and Nathan A. Chedsey were appointed in New York as the administrators of his estate. On the 12th of November, 1883, the complainant qualified as executor of the will of Mrs. Schmidt. In April, 1884, the New York administrators of Sanford presented his final account to the Hudson county orphans' court for allowance, and it was afterwards duly allowed by that court. That account exhibits that the estate of Mrs. Schmidt is indebted to the estate of Sanford in the sum of $2,630.58. This sum has not yet been paid. The complainant has not yet accounted, but he estimates that he has $1,630.08 in his hands, and he is desirous of paying that sum to those who may be entitled to it. He has obtained from the orphans' court an order barring further claims by creditors of Mrs. Schmidt. Within the time limited for the presentation of such claims, the administrators of Sanford did not demand payment of the balance due to his estate upon his and their aforesaid accounting. The complainant is "informed and believes that there are false, fraudulent, and mistaken items" in the account filed by Sanford in his life-time, and also in the account rendered by his administrators, amounting in the aggregate to the sum of $3,325, so that the estate of Sanford is indebted to the estate of Schmidt. The administrators and heirs of Sanford refuse to release their claim upon the estate of Schmidt, and in turn the legatees under the will of Schmidt forbid the complainant to pay it, or to pay the moneys in his hands to any one. The bill further alleges that "your orator further shows that he has no positive information, except by rumor, that said accounts of said Gustavus B. Sanford are fraudulent, false, and erroneous." It prays that the complainant may be allowed to pay the moneys in his hands into court, so that the defendants, who are the surviving legatees of Mrs. Schmidt, and the widow and infant child of one of those legatees, and also the administrator, heirs at law, and next of kin of Sanford may interplead, and "that the alleged fraud in the account of said Gustavus B. Sanford, deceased, executor of said Anna K. Schmidt, may be inquired into for the benefit of the infant defendant, as well as for all others concerned," and that the complainant, upon paying the money as aforesaid, may be discharged from all liability in the premises, and have his costs of this suit. Phebe E. Campbell and Josephine E. Good, two heirs at law and next of kin of Sanford, demur to this bill for want of equity.
Samuel A. Benson, for complainant. Raymond P. Wortendyke, for demurrants.
MCGILL, Ch., (after stating the facts as above.) The accounts rendered by Sanford and the administrators of his estate appear by the bill to have been duly allowed by the orphans' court. The decrees allowing them are conclusive against all persons interested in the estate, until they shall be attacked and set aside for fraud or mistake. Revision, p. 775, § 108. If there is fraud in the accounts, as the bill suggests, it is the right of the legatees, and the duty of the complainant, to institute proceedings, either in this court or in the orphans' court, to correct the accounts. If such proceeding should be unsuccessful, the balance already found in favor of Sanford must be paid by the complainant from such assets of the estate of Mrs. Schmidt as shall remain in his hands after the expenses of his administration of that estate shall be paid. 3 Williams, Ex'rs, 1861. The balance due to Sanford's estate is part of the expense of administering the estate of Mrs. Schmidt, and is not to be treated as a debt due to a creditor of the decedent, and it is not barred by the decree which the complainant obtained under Revision, p. 764, § 62, against creditors of the decedent who had not presented their claims. The bill does not present a case in which a bill of interpleader will lie. The complainant, as executor, is bound to claim an interest in the fund. He has not accounted, but he must do so. The expenses of his accounting and administration must be ascertained and paid. His commissions have not been paid. It is not possible yet to know the amount of the fund that he will have either to pay to Sanford's administrators or to distribute to the residuary legatees of Mrs. Schmidt. He does not stand as a disinterested stakeholder. The real position of the complainant is this: He does not know of any fraud in the Sanford accounts,but he fears that if he shall pay the balance exhibited by them in Sanford's favor the residuary legatees of Mrs. Schmidt will dispute the allowance of his claim for that payment when he accounts. It is impossible for him to show the fraud which is necessary to open Sanford's accounts. The residuary legatees say that there is fraud, but at the same time they refuse to disclose, or cannot disclose, what it is. Under such circumstances the complainant's obvious course is to diligently inquire for the fraud, and, if he fails to find it, and notwithstanding that fact the residuary legatees persist in forbidding him to pay the balance due to the Sanford estate, he should apply by bill for the directions of this court as to the payment, making the residuary legatees and an administrator of Sanford, to be appointed in this state, parties to his bill. Such a bill is in the nature of a bill of interpleader, in that it brings defendants with adverse interests before the court, who, so far at least as the complainant is concerned, will be concluded by the court's action. But it is not a bill for interpleader, for the complainant does not surrender the fund, but holds it, and retains his property in it for the purposes of his trust. The heirs at law, next of kin, and foreign administrators of Sanford would not be proper parties defendant. The foreign administrators cannot be sued in this state, and the next of kin and heirs at law do not represent the estate in this matter. The next of kin may have an administrator appointed here who can be sued in our courts. If they fail to do so, the complainant may apply to the ordinary to appoint an administrator ad prosequendum. The demurrer to the present bill must be sustained, and the bill dismissed.