Darlington v. Turner, 202 U.S. 195 (1906)

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Darlington v. Turner

No. 196

Argued March 6, 7, 1906
Decided May 14, 1906
202 U.S. 195

APPEAL FROM THE COURT OF APPEALS

OF THE DISTRICT OF COLUMBIA

Syllabus

Although the auditor and both courts below found that plaintiff in error’s testator had been guilty of fraud, and that his estate was liable, and, under the general rule, this Court will not disregard a particular state of facts found by both courts below, still it can and will do so when it is constrained to the conclusion that the premise upon which those courts acted is without any support in the evidence and rests upon a mere mistaken assumption, and so held in this case where the finding of fraud rested on the uncorroborated testimony of an interested witness who had been so discredited by uncontroverted evidence in regard to his own acts of omission and commission as to render it impossible to accept his testimony as establishing the alleged fraud of the deceased.

Where, by the law of their domicil, as is the case in Louisiana, minors are represented by their father as administrator, with full power under that law to receipt for and administer for their account, property bequeathed to them by a testator domiciled and dying in Virginia, a transfer of such property to the father as the administrator or representative of his minor children by a person having possession thereof in the District of Columbia is valid and binding.

Under the circumstances of this case, decedent’s liability for an amount invested having been fixed with accuracy as to time and amount, and it being impossible from the record to ascertain the ultimate fate of the investment, and whether it was so lost as to relieve decedent from responsibility, the court will hold the estate liable therefor with legal interest, but subject to adjustment for admitted overpayments to one of the complainants.

In June, 1898, Philip A. Tracy died in the City of Washington, where he was domiciled. His will, executed in Washington on March 2, 1894, was duly probated in August, 1898. The will directed the executors to build a family monument, to cause to be inscribed thereon the names and the dates of the birth and death of the deceased, of his father and mother and of a brother and sister, in accordance with minute directions contained in a memorandum accompanying the will. A bequest of $1,000 was made to the Oak Hill Cemetery Company to perpetually care for the lot and the monument. In addition, after making several minor bequests, one of which was a gift of $100 to the Home for Incurables, $2,000 was given for a Sunday school building for the Trinity Episcopal Church in the City of Washington. The residue of the estate was bequeathed

to the trustees of the Epiphany Church Home in this city, to pay for the enlargement of the building now used as the home, or for the erection of another building for the same use and purpose.

George W. Gray and J. J. Darlington, the executors named in the will, qualified.

Within one year, and before receiving notice of the claim which is the subject of this suit, the executors of Tracy had paid the debts, had discharged the minor legacies above referred to, and had in hand, to be applied to the other provisions of the will, $47,000 in money and securities and two unimproved lots in the City of Washington, of small value. The further execution of the will was prevented by a demand to pay the claim which forms the basis of this suit, and, upon refusal to do so, on June 10, 1899, this bill in equity was filed to establish and enforce the claim. The complainants were Erle H. Turner and Wilmer Turner and Ashby and Lunette Turner; the last two, being minors, were represented by Wilmer Turner as their next friend.

It was in substance averred in the bill that Silas H. Turner, a paternal uncle of the complainants, died in Fauquier County, Virginia, on September 21, 1888, leaving a will by which he bequeathed equally to complainants, who were the children of Thomas M. Turner, all the property of which the testator died possessed, the will being as follows:

Washington, D.C. April 30, 1888

I hereby give and bequeath to the four children of my brother Thomas M. Turner of Minden, Louisiana, all property, real and personal, owned by me, or in which I have any interest at the time of my death, and appoint Philip A. Tracy to distribute the proceeds of the said property equally between them.

S. H. Turner

Witness: Philip A. Tracy

George G. Fenton.

It was also alleged that this will was admitted to probate in Fauquier County, Virginia, on or about November 28, 1888. It was then alleged that Philip A. Tracy was the confidential agent and trustee of Turner, deceased, and in that capacity had in his possession money which, as agent and trustee, Tracy had invested for the benefit of said Turner. It was charged that, shortly before the death of Turner, Tracy had given Turner a memorandum or list, entirely in the handwriting of Tracy, stating the dates and amounts of the promissory notes held by Tracy belonging to said Turner and the names of the makers thereof, and that the said notes aggregated $28,972.10. This memorandum or list, alleged to be wholly in the handwriting of Tracy, was copied in the bill, and it was averred that, after the death of Turner, Tracy had admitted the accuracy of said list and his possession of the notes which it embraced. It was then averred that the land records of the District of Columbia disclosed that all the notes mentioned in the alleged memorandum or list and the accrued interest had been paid after the death of Silas H. Turner. It was averred that, with the exception of a sum of about $1,400, alleged to have been paid by Tracy to Erle H. Turner, no account had been rendered or distribution made by Tracy of the aforesaid property or of the proceeds thereof, and that, excluding the payment alleged to have been made, as above stated, to Erle H. Turner, "the entire trust fund, principal and interest and profits, had come into the possession of the defendants as executors of Tracy."

The paragraph of the bill immediately preceding the prayer was as follows:

21. That the domicil and citizenship of the parents of complainants have always been, since the birth of these complainants, either in the State of Louisiana, which was their domicil until about the-day of August, 1889, or in the State of Texas, which has been since and is now the domicil of said parents and of all complainants, except complainant Erle H. Turner, whose domicil is now Philadelphia, Pennsylvania. Complainants are informed and believe, and therefore aver, that, by the laws of Louisiana and of Texas, the parents of minor children are not, of right, guardians of the estate of such minors, and no person is authorized to receive or demand the estate of any minor domiciled in either of said states except such persons as shall be duly appointed by a court of the states having competent jurisdiction, and that neither the father nor the mother of any of these complainants nor any other person has ever been appointed by any court guardian of either the person or estate of any one of these complainants, and no one of these complainants has now or has ever had a legal guardian of the person or estate, and at no time has there been any person in being competent in law to demand or receive, in their behalf, any estate for any of these complainants, until, by reason of reaching their majority, two of these complainants have become sui juris.

Discovery was prayed of a paper which had been written and left by Tracy, containing representations regarding the claim of complainants. In substance, the prayer was for a discovery and account in the premises, and for a decree distributing among the complainants the sum which might be found due upon the account. There was also a prayer for general relief.

The answer of the executors of Tracy was in substance as follows: that Silas H. Turner and Tracy had business relations was admitted, but, in the main, all the material averments of the bill were alleged not to be within the knowledge of the executors, and proof of such averments was demanded. It was expressly averred, however, that Tracy, after the death of Silas H. Turner, had fully accounted for any property which he had in his possession, by a transfer and payment made to Thomas M. Turner, the father of the complainants, as their natural tutor and agent, they being then minors, as evidenced by a receipt signed by Thomas M. Turner, and dated November 30, 1888, which receipt was copied in the answer. Answering the paragraph of the bill calling for the discovery in respect to the paper left by Tracy regarding the claim of complainants, the defendants set forth that there came into their possession the following paper:

Washington, D.C. ___ 1898

To the executors of my last will and testament:

Sometime in 1871, Silas H. Turner, of Virginia, whom I had known for a long time, of his own volition, and without solicitation from me, came to the city and asked me to aid him in investing some twelve thousand dollars ($12,000) in real estate notes. I consented, and in a few weeks, the whole amount was invested, and he took the notes home with him. The interest was payable semiannually, and, for a time, he sent me notes by mail about the time the interest was due, so that it could be credited on the notes to satisfy the maker. This became irksome, and after a time he brought me the notes, keeping a list of them, and asked me to keep them to save him the trouble of sending them to me by mail whenever the interest was due. I kept the notes in an envelope with his name upon it, and about twice a year sent him a memorandum of interest paid, and when the amount reached several hundred dollars, I would buy another note, and send him a memorandum of the same. Also when a note was matured and paid, I would buy another note, unless he needed the money, which he rarely did, and send him a memorandum of it. This condition continued until 1888, when he died in Virginia, leaving his entire estate to the three minor children of his brother then living in Louisiana. In his will, he named me to settle up the estate and divide the money among the children, but, as the laws of Virginia require two witnesses to a will, and says neither of them shall be an executor, I could not qualify, and, as the father, if appointed, could not have given the bond, I handed him the package of notes, advised him to deposit them in the Second National Bank of Washington, District of Columbia, which he did, and agreed to look after them and have them all paid, he being out of the city. His other relations, a sister, some nephews and nieces, were much displeased with the will, and threatened to attempt to have it set aside, but have not done so. The father, a good, honest man, took the money or most of it, went to Texas and bought a farm, and was doing well until the panic of 1893 came on. Since then, they had a hard time, getting little or nothing for their farm products, and have written me some heart-rending letters, wishing they had left the money here. The children are of age, but, of course, the father could not pay them their parts of the estate, and though not a word has been said about it, I thought perhaps after my death, if they hear of it in time, some of them might attempt to hold me responsible, and if they should make such an attempt, I hereby authorize and direct my executors to employ the best counsel in the city to defend my estate in the district courts and in the Supreme Court of the United States, if it be necessary to appeal the case to that court, and to pay all costs and lawyers’ fees out of my estate. I suppose someone would have to qualify as administrators under the will before any action could be taken. My turning the property over to the father helped to keep it in possession of those to whom it was left, and to discourage and shut out the dissatisfied relatives, for if anyone had qualified, the matter would have been open for a year, and they would undoubtedly have made an attempt to have the will set aside. This is a plain statement of the case, intended for the private ears of my executors.

Referring to the prayer for discovery in other respects, it was averred that the only papers concerning business dealings between Tracy and Silas H. Turner which had come into the possession of the executors were the receipt given by Thomas M. Turner, as already stated, the memorandum of Tracy addressed to his executors, and various letters and receipts signed by Erle H. Turner. The executors specially alleged that, to their knowledge, none of the proceeds of any of the notes referred to in the alleged memorandum or list averred in the complaint had ever come into the hands of the executors, and that they had no knowledge of any disposition made of any property belonging to Silas H. Turner which might have been in the hands of Tracy, except as shown by the receipt of November 30, 1888, signed by Thomas M. Turner as natural tutor and agent of his minor children. The laches of the complainants was expressly set up as depriving them of the right to any of the relief asked for. Denying knowledge of where Thomas M. Turner was domiciled at the time of the signing of the receipt, or the lawful powers of Turner as to signing the receipt, the court was asked to determine the rights of the executors in the premises.

After joinder of issue and the taking of general evidence, the case was heard in the Supreme Court of the District.

In substance, the court in its opinion declared that Tracy and Thomas M. Turner, the father of the complainants, had conspired to despoil them, they being then minors, of their rightful share of their uncle’s estate; that the receipt given by Turner to Tracy did not protect Tracy or his estate, because Turner had not qualified in accordance with the laws of Louisiana so as to entitle him to represent his minor children, but even if he had so qualified, Tracy had no authority to pay from the fund in his hand except in the due course of administration. The court also observed that the words of the will appointing Tracy to distribute the proceeds of the property bequeathed equally between the four children of Thomas M. Turner imposed the duty upon Tracy of qualifying as executor, or, if he was unable or unwilling to do so, of applying to the court for the appointment of a suitable person. And the fraud and wrong of Tracy in turning over the property to the father was emphasized by the statement that Tracy wrote the will of the deceased and was then informed by the latter that his object was to prevent his estate from coming into the hands of the father of the children because of his spendthrift character. Although the court concluded that the estate of Tracy was liable, it did not fix the amount for which the estate was accountable, but referred the matter to an auditor to state an account and to take further evidence in respect to the expenditures properly chargeable against the share of each of the complainants upon the principles expressed in the opinion.

The auditor heard additional testimony bearing upon the expenditures made by Thomas M. Turner for the maintenance of his children out of the fund which he had received from Tracy. An account as of February 1, 1894, was stated to the court. On this account, the receipt given by Thomas M. Turner was disregarded. The sum in the hands of Tracy and due to the estate of Silas H. Turner was fixed by the alleged list set out in the bill. The ground upon which this was done was thus stated by the auditor in his report:

After the death of Silas Turner, there was found among his papers an envelope or jacket indorsed "Notes belonging to S. H. Turner, 1888;" it contained a list, in the handwriting of Tracy, of the notes, giving the date, name of maker, and amount. The date of the last note on the list is given as March 12, 1888. The aggregate principal of these notes is $28,972.10.

Evidently all of these securities were in Tracy’s possession as late as March 12, 1888.

* * * *

It being conclusively shown that, within six months before Turner’s death, Tracy had nearly $29,000.00 principal of securities in his possession as agent or trustee of Turner, the inevitable presumption of law is that of continued possession and accountability.

Making certain deductions and additions which it is unnecessary presently to refer to, the auditor found the amount due from Tracy’s estate on February 1, 1904, principal and interest, to be $48,601.44, which was attributed in varying proportions to the complainants, depending upon the amount which the report found each one of them was bound to contribute for maintenance or sums received out of the fund. The report was excepted to, exceptions were overruled, and a decree was entered adjudging the sums found due to the complainants in accordance with the report, giving the right to collect the deficiency out of further assets, if any were discovered. An appeal was prosecuted. The Court of Appeals affirmed the decree (24 App.D.C. 573) with a slight modification, rendered necessary by the allowance of an increased charge against Erle H. Turner. The Court of Appeals, in its opinion, in effect expressed views similar to those which had been stated in the opinion of the court below and in the report of the auditor. The receipt of Thomas M. Turner was disregarded. Taking into consideration the testimony, the paper alleged in the bill as a list was treated as being all in the handwriting of Tracy, and as being but a single document, and therefore as fixing the amount for which the estate of Tracy was accountable.