Gates v. McClenahan

100 N.W. 479, 124 Iowa 593
Supreme Court of Iowa·Decided July 13, 1904·Published·Cited by 8 cases

Opinion

Ladd, J.

The defendants are the executors of the last will and testament of David Stevenson, Jr., deceased. Property not specifically disposed of was left to them in trust for purposes specified in the will. A part of this was two hundred and eighty acres of land in Buchanan county, and twenty-eight lots in Jesup. Title thereto was claimed by Catherine Stevenson and others, but was finally held to have passed to defendants. McClenahan v. Stevenson, 118 Iowa, 106. After that cause had been appealed, the plaintiffs were employed by the defendants to prepare the abstracts and arguments in this court-, and they rendered such services. The -will of the decedent was admitted to probate in New York, where all the defendants reside. This action was in equity, and the relief prayed is that the value of plaintiffs’ services be established as a lien or charge against the trust estate.

Ordinarily one employed in any capacity by an executor or trustee must look to the person employing him for compensation. As he is accountable to his principal only, and not to those owning the estate, he has no lien on the property being administered. Rickel v. Ry., 112 Iowa, 148; Clark v. Sayre, 122 Iowa, 591; 2 Perry on Trusts, section 907. But to this, as to nearly every other general rule, there are exceptions. For instance, if a particular person is directed to be employed in a stated capacity by the trust deed, he may claim a lien for his services, or where by the terms of that instrument the trustee is empowered to create a lien, and does so, it may be enforced. 3 Pomeroy, Equity 1085. There is also another exception which has found approval in several jurisdictions, and it is that, wherever the account of the trustee or executor is in such a condition that he would be entitled to be reimbursed from the funds of the estate, should he pay his creditor, and has become insolvent, or for any [596] reason cannot pay, the creditor may be allowed to take his place, and be paid out of the estate to the same extent. Guerry v. Capers, Bailey, Eq. 159; Clopton v. Gholson, 53 Miss. 466; Norton v. Phelps, 105 U. S. 393 (26 L. Ed. 1072); Coopwood v. Wallace, 12 Ala. 190. See Valley National Bank v. Crosby, 108 Iowa, 651. In Clopton v. Gholson, supra, the executors were dead, and nonresidence is mentioned in connection with insolvency as obviating the general rule. In Norton v. Phelps, 54 Miss. 467, one of the trustees was dead, and the other a nonresident. In the course of the opinion the court said in reference to one of the trustees: “ He is a nonresident of the State of Mississippi, where the trust property • is, and where the debt was contracted; and the creditor has the same rights, because of this, as to the trust property, as if Pearce was insolvent. The reason why the insolvency of a trustee is an element in the combination of circumstances admitting the creditor to proceed against the trust estate, is because of the inability of .the courts to coerce the insolvent person to pay his liabilities; and the same considerations apply ordinarily, in case of the nonresidence of the trustee, with regard to his pecuniary condition, for a creditor asking the aid of our courts should not be dismissed because he might pursue a person to a foreign land, and there have a recovery against him. If he cannot obtain justice through our courts except by departing in an exceptional ease from a rule of policy, to secure justice the departure should be made.” In Coopwood v. Wallace, 12 Ala. 790, Coopwood and Driver were administrators of an estate. They employed Wallace and two others to attend to some litigation, but, as Wallace moved away, he withdrew. • Afterwards Coopwood moved from the State, and Driver became insolvent, and Henderson was appointed in their stead. The court held that it would not drive Wallace to a foreign jurisdiction to recover his fees, or to a fruitless' suit against Driver, but allow him to proceed directly against the estate of the deceased. This decision was disapproved in [597] Jones v. Dawson, 19 Ala. 672, apparently on the ground that the legal remedies against an insolvent should be exhausted before a resort should be had to a court of equity. The main objection seems to have been, that allowance of the attorney’s fee had not been made to the trustee. But in Mulhall v. Williams, 32 Ala. 489, the majority of the court announce their adherence to the principles laid down in Coopwood’s Case, and say that it may be distinguished from Jones v. Dawson, as it may, on the grounds that the trustees of the estate in. that case when the services were rendered had never been residents, and had not employed the claimant, who was an overseer engaged by one of the cestwis que trust. See, also, Mosely v. Norman, 74 Ala. 423.

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Gates v. McClenahan, 100 N.W. 479, 124 Iowa 593 (iowa 1904).

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