Opinion
Argued January 16, 1889
Decided January 29, 1889
W.H. Kenyon for appellant.
S.C. Huntington for respondent.
The finding of the referee that Ann Wilber was a member of the firm of T. Kingsford, Son Co., is assailed by the plaintiff, and we do not deem it important to determine whether that finding was justified by the evidence and the law or whether any illegal evidence was taken relating thereto, because we think the result must be the same whether she was a member of that firm or not. If the referee was right in his finding and she was a member of the firm, then upon the death of her husband she and the Kingsfords became the surviving partners and had the right to the possession and control of the partnership property, and the legal title thereto was vested in them. By mutual consent they carried on the partnership business until the death of Thomas Kingsford in 1869, and then she and Thomson Kingsford, as surviving partners, carried it on until the first day of January, 1876, when she settled with him and sold and transferred to him the entire assets remaining of the firm. In consequence of the death of her daughter Virginia, she became and was the owner of one half of her husband's interest in the firm, which, together with her one-sixth interest, gave her three-quarters of the one-third interest which stood on the books of the firm in his name. In this action the plaintiff cannot assail the settlement, and transfer which was made on the first day of January, 1876, because the note which he seeks to recover in this action is part of the consideration given upon that transfer, and by claiming the same he affirms the settlement and transfer, and becomes bound thereby. At the time of that settlement, she transferred the interest which her daughter had in the firm as the only child of Harmon L. Wilber; she also transferred her individual interest which she owned as a member of the firm or as the widow of the deceased, and also all the right and title which she had as administratrix. The whole one-third of the firm assets amounted at that time to $51.300.75 and she took one note payable to herself for $34,200.50 and one note to herself as guardian for $17,100.25. Upon the assumption that she was a member of the firm the note which she took to herself was less than her personal interest in the partnership; and she had a good title to the note, and a lawful right to dispose of the same. It is not seriously contended that if the finding be sustained, that she was a member of the firm, that the plaintiff, as administrator of her husband, has any standing for the maintenance of this action.
But it is equally clear that the action must fail if we assume that she was not a member of the firm, and that the only interest she had in the firm property on the first day of January, 1876, was in some or all of her capacities as administratrix, widow, heir of her deceased daughter, and guardian of her surviving daughter. Then she was beneficially interested in one-half of the firm property, and her daughter Julia in the other half. All the debts of the estate having been paid within a year after the death of her husband, there was no one interested in the estate on the first day of January, 1876, and during the eight previous years but herself and her daughter. No one else could call her to account or question any of her acts. During that time it must be deemed and held that the partnership was carried on and managed for the benefit of herself and daughter, representing the one-third interest therein, and the other partners; and on the first day of January the one-third interest by operation of law and the acts of the parties had ceased to belong to her husband's estate, had been separated therefrom, and absolutely belonged to her and her daughter, and no other human being had any interest therein. But for her daughter she could have dealt with that interest in any way she saw fit; she could have sold or assigned or given it away, or bequeathed it, and the title thereto would have passed, and being the guardian of her daughter she was perfectly competent at any time to convey a good title to the whole of the interest. ( Hasbrouck v. Hasbrouck, 27 N.Y. 182; Sage v. Woodin, 66 id. 578.)
It was not necessary for her at that time, nine years after the death of her husband, during all of which time the partnership, as to the one-third interest, had been carried on for the benefit of herself and her daughter, and that interest had been by her exclusively appropriated to the use of herself and her daughter, to act or assume to act as administratrix in making the transfer. It was sufficient for her to act in her individual capacity and as guardian of her daughter to convey a perfect title. And hence the proceeds of that sale, in the form of the two notes, never became part of her husband's estate, and this plaintiff, as administrator of the estate, has no right to claim the same or maintain any action in reference thereto.
But still further; if we assume that this sale was made by her as administratrix, and that she was bound to make it and could make it only in that capacity, the result is still the same. Having sold the property and taken these notes therefor, she had the right to divide the same between herself and her daughter. If she had received money upon the sale for the whole purchase-price, and had set apart half of it for her daughter and half of it for herself, the division would have been complete, and the property so divided would no longer have belonged to or been part of the estate of Harmon L. Wilber. It is the duty of an administrator to divide the estate he holds as such among those entitled thereto according to law; and the debts having been paid, no one can complain of a division of the estate among those entitled thereto according to their respective rights. On this sale she took and set apart to her daughter the one note as her share, and that note was subsequently delivered to the daughter, and she retained the same and had the benefit thereof. The other note she took to herself as her own individual share of her husband's estate. While, upon the assumption that she was not a member of the firm, that note was more than her interest in the firm property, it does not appear to be more than her share of the property then sold and of that which she had previously received as the proceeds of the firm business. In the division of the property she made on the 3d day of May, 1879, she gave her daughter more than one-half, so that it cannot be said that the whole of the note given to the defendant was not at that time, as between her and her daughter, her property. By what took place at the time of the sale in 1876, and subsequently thereto and on the 3d day of May, 1879, that note ceased to be part of the estate of Harmon L. Wilber, and she was entitled to dispose of the same as she willed.
This plaintiff has no right to question the gift which Mrs. Wilber made to the defendant. There is no rule of law which prohibits an administratrix thus situated from dividing up the estate, and appropriating a portion thereof to herself and a portion to the other parties interested. In this case her daughter Julia, who afterwards intermarried with the plaintiff, could have questioned the disposition of the property, or the plaintiff, as administrator of Harmon L. Wilber, could investigate her conduct, and ask for an accounting from her administrator in reference to the property which she took and disposed of. But this plaintiff, as administrator of Harmon L. Wilber, cannot come into court affirming the sale and then claim that this note, taken to Mrs. Wilber and by her disposed of as her own, is part of the estate of Harmon L. Wilber. It is a sufficient answer to this action that she had some interest in that note, and assumed to have the entire interest, and, therefore, it cannot be said that the whole of that note belonged to the estate of Wilber, and his administrator cannot repudiate the gift made by her.
We have not deemed it very important to scrutinize the evidence as to the gift of the note. While we find it ample to sustain the findings of the referee, it is a sufficient answer to the plaintiff's contention, that even if the gift was, for any reason, invalid, there is no foundation for the maintenance of this action to recover the note.
All we have said with reference to the note applies with equal force to the bonds, and as to them there is also entire absence of proof that they ever belonged to the estate of Harmon L. Wilber.
We think the judgment should be affirmed, with costs.
All concur except RUGER, Ch. J., not sitting.
Judgment affirmed.