Hunter v. Hunter

41 S.E. 33, 63 S.C. 78, 1902 S.C. LEXIS 53

• Court: Supreme Court of South Carolina
• Decided: March 11, 1902
• Status: Published

Opinion

The opinion of the Court was delivered by

Mr. Ctiiee Justice McIvEr.

This is the second appeal in this case, the first being reported in 58 S. C., 382, to which reference must be had for a fuller statement of the facts than it is deemed necessary to make here. For the purposes of this appeal, it will be necessary to recapitulate here some of the more prominent facts which were either undisputed or fully established by the testimony, as follows : The land out of which the various claims set up in this case are to be satisfied originally belonged to Dr. Sami. M. Hunter, who departed this life on the 25th of April, 1883, having first duly made his last will and testament, leaving his wife, the defendant, Nannie W. Hunter, and his children, who are named, as the plaintiffs in this action; that said testator, by his will, devised this land to his wife, Nannie W. Hunter, “for and during her lifetime, to support herself and my children, and to educate my children;” that the said Nannie W. Hunter 'was the duly qualified executrix of said will, and as such being advised by her father, who is characterized as “an attorney at law of many years experience at the bar,” that she had the power so to do, undertook to sell and convey the said land under which sales the defendants (other than Nannie W. Hunter) claim either mediately or imme diately; that these sales were made for a full and fair price,, and the purchase money was paid to the said Nannie W. Hunter, who, as she said in her testimony at the first trial, applied the whole of such purchase money to the payment of the debts of the testator — her deceased husband — though she varied that statement somewhat at the second trial, as will be hereinafter noted. Under the former appeal, this Court determined that under the proper construction of the provisions in the will of the testator above referred to, the widow took an estate for life incumbered with a trust to apply the same to the support of herself and the children of the testator and to educate said children, without any power to sell the same. And while the Court, in rendering its decision under the former appeal, evidently recognized the rights of the defendants to be subrogated to the rights of the creditors of the testator whose debts had been paid out of the proceeds of the sale of the land, yet as the question of subrogation had not been made in terms in the pleadings as they then stood, and was not considered or decided by the Circuit Judge, it was thought best to “remand the case to the Circuit Court, for the purpose of enabling that Court to pass upon the question of the defendants’ right to subrogation, with leave to the defendants, if they shall be so advised, to amend their answer by setting up, formally, their right to subrogation.” Accordingly, when the case went back to the Circuit Court for this purpose, the defendants availed themselves of the permission given and filed their amended answer, setting up formally their right to subrogation. To this amended answer the plaintiffs filed a reply, in which they claim, “that the alleged debts of S. M. Hunter, deceased, on which it is claimed that Nannie W. Hunter paid the proceeds of the sale of the land in controversy, matured and arose more than “six j^ears prior to the death of the said S. M. Hunter, and that at the time of his death they were barred by the statute of limitations.” Under the pleadings as thus amended the case came on for trial before his Honor, Judge Benet, when the testimony taken at the former trial was offered in evidence, together with other testimony, all of which is set out' in the “Case,” and the decree set out in the “Case” was rendered by Judge Benet, from which the defendants (other than the said Nannie W. Hunter) appeal upon numerous exceptions, which are set out in the record. A copy of this decree and the exceptions thereto' will be included in the report of this case, by the Reporter.

1 2 We do not propose to consider these exceptions seriatim, but will confine our attention to what we consider the controlling questions in the case. It will be observed that the Circuit Judge bases his conclusion, rejecting the appellants’ claim to subrogation, solely upon the ground that the debts of the testator which were paid out of the proceeds of the sale of the land wereaiibarred by the statute of limitations “at the time of their payment” — not that they were thus barred at the time of the death of the testator, as alleged in the plaintiff’s reply, setting up the plea of the statute. Now, while it is quite true that an executor would not be justified in paying a debt of his testator which was barred at the time of his death, for the obvious reason that there was then no legal obligation to pay such debt, yet it does not follow that a debt which becomes barred after the death of the testator would stand in the same category; for it may happen, and has happened, that the executor may, with a view to prevent a sacrifice of the property of his testator, induce the creditor to defer action until some arrangement could be made for the payment of such debt; and in such a case a court of equity might well feel justified in allowing an executor to carry out such arrangement in good faith. But what is more to the point, we think the Circuit Judge was clearly- in error in saying that all of these debts were barred at the time of their payment; for, with a single exception (the note of J. C. Hunter, which will be more particularfy considered hereinafter), there is no evidence whatever that any of these debts were barred at the time of their payment ; and certainly no evidence that they were barred at the time of the death of the testator. It is true, that there was testimony tending to show that some, but not all, of the notes evidencing the debts paid by the executrix, were made before 1876; but how long before, or when they matured, or whether they were promissory or sealed notes, there was not a particle of testimony. Now, when it is remembered that the time during which the executor is exempted from suit must be added to the statutory period (Lawton v. Bowman, 2 Strob., 190), it is far from clear that any of these notes were barred, unless it be the note of J. C. Hunter, to which these remarks do not apply, but which will hereinafter be specially considered. In addition to this, the rule is well settled that one who seeks to avail himself of the benefit of the statute of limitations must assume the burden of proving the facts necessary to sustain such a plea —Moore v. Smith, 29 S. C., 254; and, as is said in Yancy v. Stone, 9 Rich., 429, “The party who sets up the bar of the statute to an otherwise just claim, must prove strictly that he is entitled to its protection.”

Next, as to the J. C. Hunter note; while it is quite true that this note does appear, from the copy which we find in the “Case,” to have been a promissory note, bearing date 20th June, 1873, and payable one day after date, and, therefore, upon its face barred by the statute, yet that note was in suit, and in the complaint there was an allegation of a payment made in 1879, within the statutory period; but it was claimed that this was a joint and several note of J. P. Hunter and S. M. Hunter, and that such payment was made by J. P. Hunter and not by S. M. Hunter, and, therefore, did not have the effect of reviving the debt as against S. M. Hunter, under the case of Walters v. Kraft, 23 S. C., 578. That case does so hold; but up to the time that decision was rendered, which was on the 27th of November, 1885, after the note was paid, it was an unsettled question- in- this State, as to the effect of such payment, as may be seen by the opinion of the learned Justice, who dissented in Walters v. Kraft. It may, therefore, be regarded as a compromise of a doubtful right in a pending suit, and in that way the payment of such note may be justified. But, as there are not sufficient facts before us to enable us to reach a satisfactory conclusion, we leave this particular matter for further consideration by the Circuit Court, to which this case will be remanded for that and other purposes hereinafter indicated.

3 Appellants’ 26th exception makes the point that the Circuit Judge erred in not finding that if all the proceeds of the sale of the land were not applied by Nannie W. Hunter to the payment of the debts of the testator, so much of said proceeds not so applied were expended by her for her own use and benefit, and for the support and education of her children — theplaintiffsherein; and the appellants should be subrogated to the rights of creditors, and the cestui que trustent, to the extent of the amount so paid and expended. The point made by this exception is well taken. If the testimony of 'Nannie W. Hunter, as given at the first trial, is to be taken as the correct version of the matter, then the undisputed testimony shows that the whole of the proceeds of the sale of the land were applied to the payment of the debts of the testator. It is true, that when she was examined as a witness at the last hearing, she testified that her testimony at the previous hearing was given hastily, and “after studying it over I remembered it better;” and then proceeds to testify that all the proceeds of the sale were not applied to the debts, but that she advanced her own money to pay some of the debts and used some of the proceeds of the sale in keeping up the farm and making improvement thereon, where the children were supported and were sent to school, for which she paid with her own money. Indeed, her testimony at the last hearing tends to show that she used the proceeds of sale as if it belonged to her, thinking that she had the right to do so; so that even if her testimony given at the last hearing be accepted as the correct version or the matter, then it is apparent that a portion, at least, of the proceeds of the sale were applied to the payment of the debts of the testator, either directly or indirectly, by replacing the amount of her own money advanced by her for that purpose, and the-balance was applied either .directly or indirectly to the support of the family and the tuition of the children. If so, then the appellants would have the right to be subrogated to the extent of so much of the proceeds of the sale as were so applied. The doctrine of subrogation, as applicable to this case, rests upon this principle, that where persons have in good faith bought the lands of a decedent and it turn out that the sale is void for want of authority to make it, then, as a matter of equity and good conscience, those who have purchased the property have a .right to retain the prop - erty until the amount of the purchase money paid by them, which has been applied to the removal of burdens resting on such property, shall be refunded to such purchasers. As is said in Freeman on Void Judicial Sales, 51, which is quoted with approval in Cathcart v. Sugenheimer, 18 S. C., at page 132, and again in the former opinion in this case (58 S. C., at page 394), “If by a sale of the lands of a decedent, his debts are paid and it turns out that the sale is void, the purchaser has the right to be subrogated to the claims which he has by his purchase paid, and he has also the right to- retain possession of the property as security for the repayment of the sums to which he is 'entitled.” Now, this land was subjected to two burdens: 1st. The unpaid legal liabilities of the testator; 2d. The support of testator’s wife and children, and the education of said children; and, upon the principle above stated, these appellants have the right to retain possession of the same until the amount of the purchase money paid by them, which has been applied either directly or indirectly to the removal of these burdens, has been refunded to them. From this it follows that the Circuit Judge was in error in requiring the persons substituted as trustee to take possession of the lands in question before it was judicially ascertained whether any, and if so how much, of the purchase money paid by the appellants had been applied to the removal of the above mentioned burdens upon the land, and before the sums so ascertained had been refunded to the appellants; and to this extent exception 18 must be sustained.

4 Such of the appellants’ exceptions as make the point that the question whether the proceeds of the sale were applied to the payment of the debts of the testator, should have been regarded as res judicata, must be overruled; for Judge Watts said in his decree that it was unnecessary to pass upon that issue, as he based his judgment exclusively upon the ground that under his construction of the will, the executrix took a life estate in the land, which she had a right to sell, and as she was still living, the action was prematurely brought, and for that reason alone he rendered judgment that the complaint be dismissed, which was reversed by this Court; and this Court certainly did not undertake to pass upon the question whether any, and if so how much, of the proceeds of sale were applied to the payment of the testator’s debts; but, on the contrary, remanded the case to the Circuit Court for the express purpose of enabling that Court to pass upon the question of subrogation, which necessarily involved the question which is now claimed to have been already adjudged.

5 Exceptions 6 and 29, raising questions as to the competency of testimony, are overruled. There was testimony tending to show that the notes of the testator which were claimed to have been paid out of the proceeds of the sale were destroyed by fire, and, therefore, secondary testimony as to their contents became admissible. .

The points made by exceptions 9 and 11 are left open, to be considered by the Circuit Court when carrying out the purposes for which this case will be remanded.

Exception 10 is based upon a misconception of the decree of the Circuit Judge, and cannot, therefore, be sustained.

Exceptions 15, 16, 17, 19, 21, 22, 23, raising questions as to the rents and profits, are left open, for the reason that these questions can better be determined under the decree which will be rendered bjr the Circuit Court under the order remanding this case for certain purposes; and in this connection we may say that the point made as to betterments by exception 27 is also left open, in order that such point may also then be passed upon.

6 7 As to the exception 20, we do not understand that the Circuit Judge held the appellants accountable for the “rental value” of the land; but if so, that was error, for if the appellants should be held liable at all, it should be for rents and profits'received and not for rental value. Exception 24 cannot be sustained by reason of the minority of the plaintiffs, or at least some of them. The point raised by exception 25 is left open, as that matter should be considered when the Circuit Court passes upon the questions for the determination of which the case will be remanded to that Court.

So, also, as to the’point raised by the exception 28.

The case must, therefore, be remanded to the Circuit Court, for the purpose of considering and determining specifically what amount of the purchase money paid by the appellants, or those under whom they claim, was applied to the removal of the burdens resting upon the land as hereinabove stated; whether any of the debts of the testator, which were paid either directly or indirectly out of the proceeds of the sale of the land, were barred by the statute of limitations at the time of the death of the testator, and if so how much; and in this inquiry the burden of proof showing that such debts were thus barred shall be upon the plaintiffs, and also for the purpose of considering and determining the several points left open, as hereinabove stated.

The judgment of this Court is, that the judgment of the Circuit Court, in so far as it is inconsistent with the views herein announced, be reversed, and that the case be remanded to the Circuit Court for the purposes hereinabove indicated.