The Chancellor :—The first point presented by the pleadings and proofs in this case is, whether the acting executor is to be permitted to account for the partnership stock at the price fixed upon by himself and his co-executor.
I took up the case with a sincere desire to sustain the agreement or understanding upon which A. B. Abeel assumed to himself the sole ownership of the stock in trade, but I find it cannot be sustained without overturning principles of equity which have long been deemed essential to protect the rights of those whose property is committed to the care or guardianship of others. These principles are discussed at length in Defoe v. Fanning, (2 John. Ch. Rep. 252;) in Rogers v. Rogers, (1 Hopk. 515;) and in Hawley v. Cramer, (4 Cowen, 717.) It is therefore sufficient merely to advert *to these general principles here. The surviving partner has the legal right to the partnership effects
Under these circumstances, I should still be disposed to let the original valuation stand, if I had not reason to be[399]*399lieve there was some mistake in the estimate then made. The witnesses speak of the value of such kinds of goods in the middle of the year 1811; and the estimate of Duryea and Mowatt was undoubtedly made with reference to the state of the market on the 1st of July in that year, when the partnership was advertised as dissolved by the death of John Abeel. But it is certain the surviving partner did not at that time determine to take the goods on hand at the valuation of Duryea and Mowatt.
It is true, he says in his answer, that half the stock in trade was credited to the estate on the 1st of July, 1811. But, by adverting to the testimony and exhibits, it is evident he did not mean to say he had at that time concluded to take the property, and actually credited the estate with its proportion *on that day. He came to that conclusion some time afterwards, and then credited the same as the 1st of July, 1811. He had not determined to take it at that valuation when the opinions of Mr. Riggs and Mr. Harrison were obtained, on the 6th and 10th of August. Soon after these opinions were taken, they commenced inventorying the goods. Dunscomb says it was a long and tedious business, and that they were engaged a month or six weeks in doing it. After this inventory was completed, Duryea and Mowatt made their valuation. They undoubtedly made it with a reference to the state of the. market on the 1st of July preceding, as the surviving partner acted under the erroneous impression that he was entitled to retain the stock at its then value. Under this impression he very honestly credited the amount to the estate as of that date, that the interest might commence from that time. But in this he acted under a mistake as to his equitable rights. It does not distinctly appear at what time he did finally conclude to take the goods, and charge the amount to himself in his account with the estate. But by adverting to the history of the times, it is pretty evident that the value of the stock had been enhanced between the first of July and the completion of the inventory; or, at [400]*400least, that circumstances had so changed that an advance in the price of such articles might be reasonably expected.
The proclamation of the president, announcing the revocation of the Berlin and Milan decrees, was issued on the 2d of Kovember, 1810 ; of course the non-intercourse act went into operation against Great Britain on the 2d of February thereafter. In the intermediate time it is probable considerable importations of hardware and' iron mongery were made. This circumstance, in connection with the fact that it was generally supposed Great Britain would repeal the orders in council, would for a time keep down the value of that description of goods, although fresh supplies could not be immediately obtained. The last information received from the British cabinet, previous to the close of the session of Congress after the intercourse was stopped, was a declaration from the minister that the British system would be *abandoned as soon as the repeal of the French decrees had actually taken place. But in the course of the summer of 1811, the prospect of obtaining fresh supplies from England was materially changed. It was officially known that instead of repealing the obnoxious orders, Great Britain had enforced them more rigidly; and Commodore Rogers had been compelled to chastise the insolence of one of her naval officers, in attempting to execute those orders; on which occasion blood was shed. On the 24th of July, the president called a special meeting of Congress, to take place early in Kovember; towards the close of which session it is well known war was actually declared. From the time when this special meeting of Congress was called, a war with England, or a much longer continuance of the non-intercourse system at least seemed inevitable. A very considerable advance in the value of hardware and iron mongery must, therefore, have been anticipated before the inventory of the goods in question was completed. Kotwithstanding this great change in our commercial relations with Great Britain, the currency goods, more than five-sixths of the value of the whole stock of the partner[401]*401ship, were estimated at the original cost. It also appears from the inventory that at least $30,000 of the currency goods6 was in rolled and bar iron, steel, anchors and anchor palms, share moulds, nail rods, and other articles of that description, which could not be very materially injured by lying on hand. And the actual value of those articles could readily have been ascertained, without reference to the original cost. The witnesses in this case may not have succeeded in conveying their real meaning. Possibly the currency price is a nominal value put on the articles, from which a deduction was made on the original purchase. But as I understand the testimony, these goods were estimated at the original prices paid for them on the purchase, without any addition for commission or importation charges. Whether the $6,768 worth of stock actually sold by the surviving partner, before the inventory was completed, is estimated at the original cost, or put down at the price for which the goods actually sold, does not appear.
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The Chancellor :—The first point presented by the pleadings and proofs in this case is, whether the acting executor is to be permitted to account for the partnership stock at the price fixed upon by himself and his co-executor.
I took up the case with a sincere desire to sustain the agreement or understanding upon which A. B. Abeel assumed to himself the sole ownership of the stock in trade, but I find it cannot be sustained without overturning principles of equity which have long been deemed essential to protect the rights of those whose property is committed to the care or guardianship of others. These principles are discussed at length in Defoe v. Fanning, (2 John. Ch. Rep. 252;) in Rogers v. Rogers, (1 Hopk. 515;) and in Hawley v. Cramer, (4 Cowen, 717.) It is therefore sufficient merely to advert *to these general principles here. The surviving partner has the legal right to the partnership effects
Under these circumstances, I should still be disposed to let the original valuation stand, if I had not reason to be[399]*399lieve there was some mistake in the estimate then made. The witnesses speak of the value of such kinds of goods in the middle of the year 1811; and the estimate of Duryea and Mowatt was undoubtedly made with reference to the state of the market on the 1st of July in that year, when the partnership was advertised as dissolved by the death of John Abeel. But it is certain the surviving partner did not at that time determine to take the goods on hand at the valuation of Duryea and Mowatt.
It is true, he says in his answer, that half the stock in trade was credited to the estate on the 1st of July, 1811. But, by adverting to the testimony and exhibits, it is evident he did not mean to say he had at that time concluded to take the property, and actually credited the estate with its proportion *on that day. He came to that conclusion some time afterwards, and then credited the same as the 1st of July, 1811. He had not determined to take it at that valuation when the opinions of Mr. Riggs and Mr. Harrison were obtained, on the 6th and 10th of August. Soon after these opinions were taken, they commenced inventorying the goods. Dunscomb says it was a long and tedious business, and that they were engaged a month or six weeks in doing it. After this inventory was completed, Duryea and Mowatt made their valuation. They undoubtedly made it with a reference to the state of the. market on the 1st of July preceding, as the surviving partner acted under the erroneous impression that he was entitled to retain the stock at its then value. Under this impression he very honestly credited the amount to the estate as of that date, that the interest might commence from that time. But in this he acted under a mistake as to his equitable rights. It does not distinctly appear at what time he did finally conclude to take the goods, and charge the amount to himself in his account with the estate. But by adverting to the history of the times, it is pretty evident that the value of the stock had been enhanced between the first of July and the completion of the inventory; or, at [400]*400least, that circumstances had so changed that an advance in the price of such articles might be reasonably expected.
The proclamation of the president, announcing the revocation of the Berlin and Milan decrees, was issued on the 2d of Kovember, 1810 ; of course the non-intercourse act went into operation against Great Britain on the 2d of February thereafter. In the intermediate time it is probable considerable importations of hardware and' iron mongery were made. This circumstance, in connection with the fact that it was generally supposed Great Britain would repeal the orders in council, would for a time keep down the value of that description of goods, although fresh supplies could not be immediately obtained. The last information received from the British cabinet, previous to the close of the session of Congress after the intercourse was stopped, was a declaration from the minister that the British system would be *abandoned as soon as the repeal of the French decrees had actually taken place. But in the course of the summer of 1811, the prospect of obtaining fresh supplies from England was materially changed. It was officially known that instead of repealing the obnoxious orders, Great Britain had enforced them more rigidly; and Commodore Rogers had been compelled to chastise the insolence of one of her naval officers, in attempting to execute those orders; on which occasion blood was shed. On the 24th of July, the president called a special meeting of Congress, to take place early in Kovember; towards the close of which session it is well known war was actually declared. From the time when this special meeting of Congress was called, a war with England, or a much longer continuance of the non-intercourse system at least seemed inevitable. A very considerable advance in the value of hardware and iron mongery must, therefore, have been anticipated before the inventory of the goods in question was completed. Kotwithstanding this great change in our commercial relations with Great Britain, the currency goods, more than five-sixths of the value of the whole stock of the partner[401]*401ship, were estimated at the original cost. It also appears from the inventory that at least $30,000 of the currency goods6 was in rolled and bar iron, steel, anchors and anchor palms, share moulds, nail rods, and other articles of that description, which could not be very materially injured by lying on hand. And the actual value of those articles could readily have been ascertained, without reference to the original cost. The witnesses in this case may not have succeeded in conveying their real meaning. Possibly the currency price is a nominal value put on the articles, from which a deduction was made on the original purchase. But as I understand the testimony, these goods were estimated at the original prices paid for them on the purchase, without any addition for commission or importation charges. Whether the $6,768 worth of stock actually sold by the surviving partner, before the inventory was completed, is estimated at the original cost, or put down at the price for which the goods actually sold, does not appear.
*There must, therefore, be a new valuation put upon the stock in trade on the first of October, 1811, which is probably full as early as the time when the acting executor assumed the absolute ownership of the property. The valuation must also be made in reference to the nature of the particular stock on hand, and the then existing and probable relations of the country; and the good will of the business must also be taken into consideration. The goods sold before that time, as mentioned in the inventory of currency goods, must be separated therefrom; and if estimated at the original costs, must be charged with the additional prices obtained on the sale. Interest must be charged against the acting executor, and the accounts taken upon the principles sanctioned by the last decree of this court and the decision of the Court of Errors in Clarkson v. De Peyster, except that in stating the account, the five per cent, allowed to the executors on the income of the estate must be deducted from the interest or income from time to time, and only the balance thereof charged. This account must thus [402]*402be continued up to the time when Mrs. Weeks came of age.
The next- question is as to the manner in which the account is to be taken so as to give the adopted children a support out of the general funds of the estate, on principles of equality. If the same expense had been bestowed upon each, the niece, who was much the oldest, would have in fact received a less proportion of the property than the younger children-who were to be supported out of it for a much longer period, provided that support was taken from the bulk of the estate, instead of being charged upon the particular share of each. But it was probably in the contemplation of the testator that each should be supported out of her own share, as the executors are directed to pay over their proportions as they respectively arrive at the age of twenty-one. The expenses of each would be greatly increased as they approached the termination of their minority. If the oldest was supported out of the bulk of the estate until twenty-one, and then permitted to withdraw the whole-of her share from the fund, great injustice would be done to the younger children; and if this principle is adopted, the *payment of the $2,500 to Mrs. Weeks as an equivalent for support which was not actually rendered or necessary, cannot be sustained. The executor has acted on the supposition that he was not to bestow an equal expense for the support and education of each child, but was authorized to exercise a discretion in relation to that matter. His niece was about nine years of age at the death of the testator, and she has had expended for her support and education, for the period of twelve years, $6,545, which is about $1,500 more than waq expended on Mrs. Case for a period of time three years and a half longer. The expenses bestowed upon the two children of Phebe Howell were probably much less. Ho injustice, therefore, will be done to Mrs. Weeks and Mrs. Case, if the whole amount of their support is charged upon their respective proportions of the estate, leaving the future as well as the past expenses of the [403]*403two infant children of Phebe Howell to be charged on their respective shares of the estate only.
As the will originally stood, there could be no difficulty in keeping the accounts of each of the children separately. A sum sufficient to raise the annuity to Mrs. Howell should have been set apart for that purpose, and the rest divided into four equal shares and kept separate and distinct. Even after the codicil had provided for the support of another child out of the estate, there would have been no difficulty in setting aside a sufficient sum for that purpose, or, what would have been more simple than either, the executor might annually have charged one-fourth of the support of Phebe Howell and her son to the share of each of the adopted children. In consequence of the manner in which the fund has been kept and managed, it must be extremely difficult to state the account aneAV from the beginning; but I see no other way of doing justice between the parties.
Executors and trustees must be made to understand that it is their duty to keep the funds of their trust separate and distinct from their other funds and business; that they should, upon no consideration, use the trust moneys themselves, or permit it to be mingled Avith their OAvn moneys or property. In no other Avay can they save themselves from trouble, litigation and censure. If they neglect this obvious duty, they *have no reason to complain if they meet Avith trouble and expense, and sometimes Avith heavy loss. The protection of the rights of those who are not in a situation to protect themselves, makes it the duty of courts of justice to require fiduciaries to make good all losses which have been occasioned by their neglect.
As the executor has made a final settlement Avith Weeks for the share of his wife’s estate up to the time when she became of age, no new account need be taken of her share previous to that time. But she will be entitled to an account of the administration of her portion of the $10,000 set apart for the support of Phebe Howell and her infant son.
[404]*404The master must state three separate accounts up to the 28th of May, 1823, when Mrs. Weeks became of age, between the acting executor and Mrs. Case and the two daughters of Mrs. Howell.
In the account with Mrs. Case, the master must charge the executor one-fourth of all sums properly chargeable against him on account of the estate, and interest on the principles before stated, after deducting commissions, and must credit him one-fourth of all moneys expended for the general purposes of the estate, and for the payment of the specific or pecuniary legacies or debts, or for the support of Mrs. Howell or her infant son, and the whole amount expended for the maintenance and education of Mrs. Case, or other expenditures properly chargeable upon her share exclusively. And the accounts between the executor and the two children of Phebe Howell must be taken in the same manner. On the 28th of May, 1823, $2,500 must be taken from the balance due each, to make up their shares of the $10,000 fund, appropriated, at that time, for the support of Mrs. Howell and her son. The separate accounts must then be continued upon the balance, in the same manner, except as to the support of Mrs. Howell and her son and the general expenses of the estate, which must, from that time, be charged upon the $10,000 fund. And a distinct account of the administration of that fund, as between the acting executor and all the adopted children, mustbe taken by the master. The executor is not to be charged for a greater rate of interest than was actually *received on moneys Iona fide loaned by him on bond and mortgage. There is no foundation for the charge that he put it out for a rate of interest less than seven per cent, unnecessarily or improperly. His own interest required that he should procure the greatest possible income from that part of the estate which was loaned out on bond and mortgage; and I am satisfied from the testimony that all the loans which were made under seven per cent, were so made in good faith.
[405]*405There must be a reference to a master to take and state the account upon these principles and directions; and he must also ascertain and report the situation of the trust fund which is now invested in stocks or on bond and mortgage, and whether the same is properly secured and safely invested. And the question of costs, and other questions and directions are to be reserved.
Murry v. Mumford, 6 Cow. 441; Van Kuren v. Parmellee, 2 Comst. 523.