Gibson v. Herriott

17 S.W. 589, 55 Ark. 85, 1891 Ark. LEXIS 144
CourtSupreme Court of Arkansas
DecidedNovember 14, 1891
StatusPublished
Cited by42 cases

This text of 17 S.W. 589 (Gibson v. Herriott) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gibson v. Herriott, 17 S.W. 589, 55 Ark. 85, 1891 Ark. LEXIS 144 (Ark. 1891).

Opinion

Battle, J.

Solomon Walton died on the 4th of November, 1876, in Jefferson county in this State, intestate, leaving Belle Herriott, Rosa E. Lindsay, Kate Hinton and Sallie E. Whitley, who were his children, his only heirs him surviving. He was at the time of his death a married man, and left his wife, M. A. Walton, who is now the wife of John W. Gibson, surviving. At his death he was the owner of personal property and about 860 acres of land, of which 265 acres were cleared and in cultivation; and was much in debt. Shortly after his death Mrs. Walton administered on his estate; and sometime thereafter dower in his land was set apart and assigned to his widow. His personalty not being sufficient to pay his debts, his administratrix applied to the Jefferson probate court for an order to sell the lands which had not been assigned as dower, and the reversion in the other, to pay the debts remaining unpaid. The probate court granted the application at its July term, 1879, and authorized and directed the administratrix to sell all the lands, including the reversion in the land assigned to the widow as •dower. On the 24th of September, 1879, the land which had not been assigned to the widow was sold at public auction to E. W. Martin and F. J. Wise at and for the sum •of $2800, they being the highest bidders therefor, and the other land was sold to Frank Tomlinson, subject to the •dower, for $750, no one offering more for it. Martin and Wise, not being able to comply with the terms of the sale, induced Louis and Joseph Altheimer to take their bid. Before they did so they purchased from Tomlinson the right, ■claim and interest acquired by him at the sale and procured from him an assignment of his bid. They (the Altheimers) Laving complied with the terms of the sale, the administratrix, on the 27th of September, 1879, conveyed to them the said lands and reversion, reserving a lien for the unpaid purchase money. Attempting and failing to purchase of the widow her interest in the lands set apart to her as dower, they proposed to sell to her the lands and reversion in lands conveyed to them. Persuaded by her friends to accept this proposition, she purchased the land and reversion on a credit of four years, agreeing to pay one thousand dollars more for it than the sum for which she sold it. In pursuance of their agreement the Altheimers, on the 30th of September, 1879, conveyed to her the lands, including the reversion. Afterwards, on the 15th of October, 1879, the administratrix made a written report of the sale of the land, including the land assigned as dower, made by her, as evidenced by her conveyance to the Altheimers, to the probate court, which on the same day approved the sale; and, with the proceeds of the sale so approved, the administratrix paid the said debts of her intestate.

At the death of Solomon Walton the land was in bad condition; the houses were dilapidated ; only a few of them, were fit for use. The fences on it were not sufficient to protect the crops, which were thereafter grown on it, against the trespasses of cattle. There were 265 acres cleared and prepared for cultivation. The annual rental value of the-land was $800 or $1000. The widow attempted to rent it for $800, but failed. After she purchased it from the Altheimers, she cleared 230 acres of it, twenty or thirty acres of which were on the land which was set apart to her as dower built fifteen tenant houses on the land; dug eight or ten wells; put a new fence around the cleared land as often as twice, one and a quarter miles of which was a wire fenee erected on the land a large barn, a new gin house, saw and grist mills and cotton press ; put in the gin house a new cotton gin; attached to the saw and grist mills and cotton gin new steam machinery so as to operate them by steam ; and expended a large sum of money in improving the land. The-annual rental value of the land, after these improvements-were made, has been and is $2500.

After this, on the 13th day of Jüly, 1887, Belle Herriott,. Rosa E. Lindsay, Kate Hinton, and their husbands, and William M. and Daniel E. Whitley, minors, the heirs of Sallie E. Whitley, who is dead, by their next friend, brought, this action in the Jefferson circuit court against M. A. Gibson and her husband. They alleged in their complaint that the sale to the Altheimers and the conveyance by them to the widow were fraudulent, and asked that the deed executed by the administratrix as before stated be canceled, and that Mrs. Gibson be declared to be a trustee holding all the land, except her life estate therein which was her dower,, in trust for them. The defendants answered, but did not plead the statute of limitations. The circuit court held that the sale made by the administratrix on the 24th of September and the conveyance by the Altheimers to the widow on the 30th of September were fraudulent, because she was under a disability to purchase until the sale was confirmed, and that she held the land, including the reversion in the land set apart as dower, in trust for the plaintiffs; and decreed accordingly. Did the circuit court err?

1. Trustanse»whsn administratorpurchase» at his own sale. As a rule no one occupying a relation of trust or confi- - . . . . dence to another is permitted to purchase property for himself when he has, by reason of such relation, a duty to perform in respect to it which is inconsistent with the character of a purchaser; or to do any other act which has a tendency to interfere with the faithful discharge of such duty.

It matters not how fair, profitable or advantageous the purchase may be to the cestui que trust, courts of equity will set it aside upon the application of the cestui que trust. The object of the rule is to protect the cestui que trust against fraud and injustice, and to remove from persons holding such relations all inducements and temptations to-speculate upon or control, for their own benefit, property held by them in trust or confidence. This rule applies to-executors and administrators, and in this State has been extended to an attorney of an administrator who prepared and filed the petition of the administrator and obtained the order for the sale of property of the deceased. West v. Waddill, 33 Ark., 575; Hindman v. O' Connor, 54 Ark., 627.

The rule is clearly applicable to this case. At the time Mrs. Walton purchased, the sale made by her in her fiduciary capacity was incomplete, and she was the owner of all the interest, if any, acquired by it; and the question was, should the sale by the administratrix which involved her own purchase be approved by the probate court? If it was disapproved, she. took nothing by her purchase from the Altheimers. Under these circumstances she, as administratrix, reported the sale made by her to the probate court for confirmation. It was, then, her duty to give to the court all the information in her possession which would have better enabled it to decide whether it was to the advantage of all parties concerned that the sale be approved; and to resist the confirmation of it, if it had been unfairly conducted or its approval involved an unnecessary sacrifice to the estate of her intestate. It is obvious that her duties as administratrix at the time she purchased were inconsistent with the character of a purchaser. The heirs of the deceased could, therefore, have had the sale set aside, without showing actual fraud or injury. Livingston v. Cochran, 33 Ark., 294; Terwilliger v. Brown, 44 N. Y., 237.

2. whenrights But the sale was not void, but voidable by the persons interested in the estate of Walton.

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17 S.W. 589, 55 Ark. 85, 1891 Ark. LEXIS 144, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gibson-v-herriott-ark-1891.