Booth v. Starr

Edmond, J.

Admitting the facts, as stated in the petition, to tie true, it is manifest, that Stephen Booth paid to John Booth, 800L lawful money of New-York ; that in exchange for this sum, John gave to Stephen a deed containing covenants *424 of seisin ami warranty, and that this deed conveyed no tide ; (hat Sltphcn was ejected, and deprived of the lam), and the purchase money ; that lite funds or t slate of John, were increased to ■ the amount of t)ie consideration paid; that the other creditors of John, have been satisfied out of his estate, and that there is a surplus Tomainim:. This sum, the heir cannot, in my opinion, conscientiously, withhold against the petitioner, unless some act or neglect of his, by force of some statute, has worked a forfeiture of his right to indemnity, to justify the detention. It is admitted, that the petitioner’s claim on the covenant of seisin, is barred, by the statute, on account of his neglect to make out his claim before the commissioners ; but bis claim on the covenant of warranty, for damage sustained by the eviction, stands on different ground. In respect to that, it does not appear, that the petitioner, by any act, has impaired his right, or by any neglect, forfeited his claim to indemnity. The estate in question was proceeded with as an insolvent estate, under the statute, for the equal distribution of insolvent estates.

The covenant in the deed, for the quiet and peacablc enjoyment of the premises, was not broken, until the eviction by Eli Starr and wife, in March, 1810, a time long subsequent to the final settlement of the estate ; when the time limited by the court of probate for exhibiting claims, had expired, and the power of the commissioners to examine and allow claims, had ceased. Within the time limited to creditors to exhibit their claims to commissioners, this claim did not exist, and under the insolvent act, an administrator has no authority to liquidate or allow any claims whatever. The petitioner, pending the settlement of the estate, in respect to his claim for eviction, was not a creditor, in any sense of the word ; he had then sustained no injury, had no claim to exhibit, and is not chargeable with any neglect in respect to it. The possibility, or even probability of a future claim does not constitute a person a creditor. The limiting eiausr of the statute, tit. 61. c. 1. s. 6., contemplates those persons only, who may have claims existing within the time limited for their exhibition ; and such claims only, are expressly *425 nam'd. Tliia section has no lien ring on claims that might arise from the covenants of warranty, subsequent to the time united for the exhibition of claims to the commissioners, if this be so, the petitioner’s right is not extinguished ; his claims on the estate are not eancelicd or barred by the statute, although his right to r< cover against the administrator, in an action at law, may be barred.

The act for the equal distribution of insolvent estates, takes for its basis, the insufficiency of the estate of the deceased for the payment of debts, and makes provision for the distribution and division of the whole, it bar? all existing claims, not exhibited to the commissioners within a limited time. It gives the whole, (except an allowance to the widow, and for payment of privileged debts, and incidental charges, which are first to be paid,) to those who prove their claims before the commissioners, pursuant to the directions in the act. It requires no bond to be taken before the judge, to refund, in case after debts be made to appear. No remaining fund in the hands of the administrator, or elsewhere, to answer future contingent claims, is contemplated as possible, by the act, except in the case where a creditor, after settlement of the estate,, can shew or find some other and further estate of the deceased, not before discovered and put into the inventory. In this point of view, it would have been legislating to very little purpose, after providing for a specific application of every cent of the property, to have added, that such person, as might, after such application of the whole, have claims arising out of covenants of warranty, or otherwise, and become a creditor, should for ever after be debarred of his or her debt; or any other words of the like import. This statute, therefore, is entirely silent on the subject of future possible claims, and does not stand in the way of the petitioner’s right in equity, of satisfaction out of the estate of the deceased, notwithstanding a conformity, by the administrator, in all respects, to the provisions of this act, which may operate as a complete bar to the petitioners right of recovery in an action at law against tile administrator, as such.

*426 This law is equally silent ou the subject of the surplus estate, after satisfaction of creditors, &e. ; and indeed, the very supposition of a surplus, is excluded by the act ; yet it is perfectly well understood in practice, that comparing the inventory with the report of the commissioners, an estate may appear to be insolvent, and must be so adjudged ; yet, when the estate comes to be sold by the administrators, by a fa-vourable sale, the net proceeds may far exceed the amount of the widow’s allowance, privileged debts, claims made out, anil administration expences. This balance, without any taw expressly requiring it, has usually, (and a long acquiescence seems to countenance the usage,) by order of the judge, been delivered over, by the administrator, to the heir; and in this manner, the property pursued by the petitioner, came into the hands of Friend Starr, as guardian to Harriet Booth. Where, then, is the insurmountable obstacle to the petitioner’s reaching this property, by an application and decree in chancery ? His demand on the estate is just; his claim is not extinguished ; he is not chargeable with negligence; there is no statute to bar his claim ; he has no remedy against the administrator, as such, and no adequate remedy at law.

Several objections have been made in relation to this petition, that deserve attention.

It was contended, that Harriet never had notice of (lie petitioner’s claim, before the service of the petition ; and that it would be inconsistent with the principles of equity, to bring forward a claim in a court of equity, for the breach of a covenant, or contract, of which Harriet, the respondent, never had notice.

I consider this objection of little importance, in view of the situation in which she stands, as stated in the petition. She is a bankrupt; the claim is not on her personally, but on the property, as the estate of the deceased, in the hands of Friend Starr, the trustee of the property, nominally for her, but ou the principles of natural justice, for the petitioner, as a creditor of the estate.

It was further objected, that Friend Starr holds this money *427 as guardian to Harriet, and as such, is holden hy his bond, io account for it before the court of probate ; and that his account, as guardian, can only be adjusted before (hat court.

To this objection, it is a sufficient answer to say, that a court of chancery, upon a hearing on this petition, can as easily ascertain the balance, if any remains unexpended m the hands of the guardian, as the court of probate ; and any sum taken out of the guardian’s hands by a decree in chancery, will be well accounted for by him before the court of probate, by producing the decree, and a justification of his conduct before any other court, so far forth, in any suit upon his bond.

Again, it was said, there is no rule of damages given in the petition ; that there is nothing stated relative to the value of the estate, at the time of the eviction. The petition states the consideration paid for the land, and avers, expressly, that by the eviction, the petitioner is damnified to the amount of 5000 dollars. This would be a sufficient averment, in an action at law.

It was further contended, that the court cannot settle the damages on a breach of covenant, without the intervention of a jury ; that the petitioner ought to have brought his action at law, recovered judgment, had the claim liquidated, execution issued, and then let the administrator shew, when called upon, what he has done with the property ; and if the administrator is exonerated, then let the petitioner with his claim, so settled, go into chancery.

If it were admitted, that a suit at law might be sustained aeainst the administrator of an insolvent estate, for a claim that did not exist pending the settlement, it is easy to see, that the necessity of the process proposed in the objection, would bring the petitioner to the point where he now is, except as to costs. The administrator having no interest in the event of the suit, and having no funds in his hands to defray the expence of defending, would not appear to defend, at his own cost, and it would be unjust to require it of him. Judgment must, then, be by default. The jury would not be railed to assess damages; the court must assess them *428 on an ex parle bearing, if at all. On return of execution, and scire facias against the administrator, lie will be compelled to appear and defend, or be subjected io payment out of his own estate. His course will then be, to shew a full and complete disposition of the estate, and make out a good defence, at law, against the petitioner’s claim. The petitioner must then abandon it, or seek redress in a coart of chancery, with bis claim no better liquidated and settled, than it might have been by application to a court of chancery in the first instance.

From the best consideration, therefore, I have been aide to bestow on the case, I am satisfied that the petitioner i-entitled to a hearing on the merits of his petition.

The other Judges concurred.

Demurrer overruled.