McClung v. Sieg

46 S.E. 210, 54 W. Va. 467, 1903 W. Va. LEXIS 145

• Court: West Virginia Supreme Court
• Decided: December 16, 1903
• Status: Published

Opinions

POEEENBARGBR, JuDGE:

This is a suit in equity brought in the circuit court of Pendle-ton county by D. G. McClung, administrator of James M. Sieg, deceased, whose domicile was in Virginia at the time of his death, against John S. McNulty, the Virginia administrator of said Sieg, as such administrator and in 'his own right, the widow and heirs at -law of said Sieg and S. B. McClung, for the. purpose of compelling Frances V. Sieg to refund to the West Virginia administrator out of her distributive share the sum of $1,028.62, the amount of a judgment and cost of defending the suit, for a debt of which the adiministrator had no notice at the time he made distribution, or, to be more accurate, permitted the Virginia administrator to collect the assets in West Virginia and make the distribution, if, legally speaking, distribution has been made. It is claimed by McClung that the fund which he has attached in the hands of S. B. McClung is a part of the uncollected assets of the estate of his intestate, although the Virginia administrator had, long before the bringing of this suit, turned that fund over to Frances V. Sieg, the widow, as part of her distributive share, and released S. B. McClung, the debtor, and McClung had executed a new note for the amount payable to Frances V. Sieg. So the debt which S. B. McClung owed to.James M. Sieg, plaintiff’s intestate, remained in the hands-of McClung at the time this suit was brought, but was claimed by Frances V. Sieg. Mrs. Sieg had received from the domiciliary administrator in all, $2,551.00 up to February 1, 1895, and there yet remained due her, on account of her distributive share as shown by the record, $873.88 at that time; but, of the amount so received by her, $1,101.00 was the amount in the hands of S. B. McClung, which he did not collect but for which she took his note. McClung owed her, on account of some transaction between them, $100.00 with interest from June 8, 1896. This last sum seems not to .have been any part of the estate of James M. Sieg. Mrs. Sieg, McNulty and the heirs of James, M. Sieg, being non-residents, an order of publication was taken against them, and Mrs. Sieg appeared and filed her separate demurrer and answer to the bill but there was no appearance for any of tbe other parties except S. B. McClung, who filed his answer as garnishee in the attchment proceeding. From his answer and the pleadings and evidence in the case the court found that there was due from him to Frances Y. Sieg, the sum of $1,103.17 with interest from the-day of-, 1891, subject to a credit of $300.00 as of February 9, 1894; $100.00, December 18, 1894; $300.00, February 2, 1896; $100.00, January 5, 1895; '$300.00, February 10, 1896; and that he was also indebted to her in the further sum of $100.00 with interest thereon from June 8, 1896, and, on the 10th day of November, 1899, made a decree requiring S. B. McClung to pay over to D. G. McClung, the plaintiff, the amount due from him to Frances Y. Sieg as assets of the estate of James M. Sieg, deceased, subject to the payment of any debts against said estate. It is from said decree that this appeal was taken.

It seems that the facts in reference to the debt paid by D. G. McClung, administrator, after the funds belonging to the estate of his intestate, except those in the hands of S. B. McClung, had, by his consent, been collected and taken out of the state by the Virginia administrator, and the money in S. B. McClung’s hands had been turned over to Mrs. Sieg, as part of her distributive share, are such-as would entitle the plaintiff, upon proper proceedings in a court of equity with the necessary parties in court, to compel reimbursement by the distributees and heirs, although no refunding bond was taken from them. McClung was appointed as administrator in 1876 and there was a large amount of money in the state of West Virginia due to his intestate which he might have collected, but as it appeared that there were no debts of any consequence due from him, to persons residing in this state, McClung permitted C. P. Jones, who had been the •law partner of Mr. Sieg in his life time and who was familiar with his business, to collect, as attorney for plaintiff, nearly $6,000.00 and pay it to McNulty. After this had been done and the McClung d'ebt had been turned over to Mrs. Sieg, a judgment was rendered against D. G. McClung, administrator, in the circuit court of Pocahontas county in June, 1893, for the sum of $712.15 with interest from the 20th day of October, 1892, for a debt due from the estate of his intestate. In April, 1897, a decree was entered in a chancery suit in Pendleton county, requiring said McClung to pay the said judgment, then amounting to $904.07, out of bis own funds. This was satisfied by him on the 5th day of May, 1897, and, with the interest and costs, then amounted to $945.17. In addition to that, he. had been compelled to pay out $83.45 in defending these suits, making his total outlay $1,038.62.

The debt which McClung was compelled to pay seems to have been stubbornly contested on his part and there is no evidence of any fraud or improper conduct imputable to him in that connection and the debt did not appear until after the assets had passed out of his hands. Under such circumstances, legatees may be compelled to refund and the same rule is, of course, applicable to distributees of an intestate’s estate., Jones’s Exrs. v. Williams, 2 Call. 103; Burnley v. Lambert, 1 Wash. 312; Gallegoe v. Lambert, 3 Leigh 465; 1 Tuck. Com. 425; Robertson v. Archer, 5 Rand. 319, where, although the court refused a decree for refunding because the claim was too old, the principle is ad-* mitted and the legatees were compelled to give refunding bonds for the benefit of the executors as to claims of any other creditors that might exist; Bower v. Glendening, 4 Munf. 219. Here, the court holds that “If without fraud or collusion, a decree be rendered, by a court of competent jurisdiction, against an executor, he may bring his suit in equity against the legatees, for contribution to satisfy such decree.” This Court announces the same doctrine in McEndree’s Am'r v. Morgan, 31 W. Va. 521.

But it is seriously contended that, in order to compel reimbursement, the executor or administrator must sue all the dis-tributees or legatees, so that the burden of refunding will fall upon them in proportion to what they have received from the estate; and that the suit cannot be maintained against Mis. Sieg alone, she being the only one of the distributees who has appeared. The others are all non-residents and if Mrs. Sieg cannot be held in this suit, the administrator will be compelled to go Lo a foreign jurisdiction to enforce his claim.In Virginia he might be able to make them all defendants in one suit, but he insists that this Court will not compel him to go out of the state for that purpose. It is undoubtedly true that, ordinarily, all the legatees or distributees should be parties. “The creditors have a double remedy; first, against the executors at law, in which case the executors have their remedy in equity, against the legatees, to compel them to refund; or secondly, the creditors may, in equity, pursue the estate in the hands of the legatees; and in either case, all the legatees must be made parties, that the charge may not fall upon one, but may be equally borne by the whole. But if this direct mode against a particular legatee was permitted, it would put it in the power of the creditor, to mark out the person, in the first instance, to sustain the whole weight.” Burnly v. Lambert, 1 Wash. 313; Scott v. Halliday, 5 Munf. 103; Sampson v. Bryce, 5 Munf. 175; Lewis v. Overby’s Adm’r. 31 Grat. 601. But the circumstances of this case are unusual and extraordinary in this, that Mrs. Sieg is the only distributee, (assuming that the legal title to the fund in Mc-Clung’s hands was held by her when it was attached) who had any property in this state that could be subjected to the claim of the administrator. But for that circumstance, he would have had no remedy against her here. liad they all been residents of the state of West Virginia, or all had property within the jurisdiction of the court, it would have been the duty of McClung to sue them all and make them contribute ratably to his reimbursement. As it is clear that for want of means to bring any of them except Mrs. Sieg within the jurisdiction of the court, plaintiff can proceed against her only, shall it be said that he is deprived of his remedy against her because jurisdiction of the balance of the distributees cannot be obtained ? If that be true and the distributees were domiciled in different states, he could not obtain relief against any of them. Such is not the tendency of the decisions nor the spirit of the law. In Ryan’s Adm’r v. McLeod, 32 Grat. 367, where it was sought to subject real estate in the hands of heirs to the payment of their ancestor’s debts, one of them had sold his portion to a bona -fide, purchaser and had become insolvent, and the portions of the other heirs were subjected to the payment of the whole of the debts. The same principle is applied in Lewis v. Overby, 31 Grat. 601. Although these cases are not exactly in point, they show that where it is impossible to make the heirs contribute ratably, the portion which cannot be collected from one of them because of his insolvency may be charged against the others. The case is analogous to that of a joint demand as to which it is necessary that all the obligors be made parties. In those cases the non-residence of part of them does not preclude judgment as to such of them as can be legally served with process. Nor is it any objection to proceeding by attachment as to any of them who may happen to have property within the jurisdiction of the conrt. “Where, in an action or suit against two or more defendants, the process is served upon part of them, the plaintiff may proceed to judgment as to any so served, and either discontinue it as to the others, or from time to time, as the process is served as to such others, proceed to judgment as to them until judgments be obtained against all.” Code, chapter 125, section 52. If Mrs. Sieg is compelled to pay the whole of this judgment, she will be entitled to contribution from the other distributees of the estate. “Legatees are liable to refund even at the suit of other legatees in some cases. As where the assets were, originally deficient, and all are bound to abate in proportion; there if the executor pays one in preference to the rest, they may exhibit their bill and compel him to refund.” Tuck. Com. 425; Toll. 341. “In all cases legatees are liable to refund at the suit of creditors, if there is a deficiency of assets.” Tuck. Com. 425. The same principle that makes it necessary to make all the distributees parties, where the administrator is entitled to be reimbursed, and all can be made parties, entitles one legatee who is compelled to refund the whole amount to the personal representative, to have contribution from all the others. Manifestly, it is a hardship upon Mrs. Sieg to compel her to refund the whole of this debt to the administrator. But as she may compel the other distributees to contribute and relieve her of all of it except what she is equitably bound to pay, it would be a much greater hardship upon the administrator to deny him relief, for, in that event, he has no remedy. Although it is claimed that he should have gone to the State of Virginia to have instituted this suit where he could have brought all the distributees in to answer his bill, that contention is not in conformity with the principles of law. Where, a plaintiff may resort to either of two different forums in the same jurisdiction, the one to which he does go will not turn him away simplv because he may obtain relief elsewhere. This being true, it will be difficult to find a satisfactory reason for the refusal of a court, having power and authority to give relief, to entertain the plaintiff’s bill on the ground that he may obtain relief in a foreign jurisdiction. No precedent for such action has been cited or found.

These views are strengthened by the following legal propositions: “Each independent sovereignty considers itself competent to confer, whenever there is occasion, a prohate authority, whether by letters testamentary or of administration, which shall operate exclusively and universally within its own sovereign jurisdiction, there being property of the deceased person, or lawful debts owing, within reach of its own mandate and judicial process.” Schouler’s Ex. & Adm’r. section 165. One of the main purposes of the' appointment of an ancillary administrator is the subjection of the assets of the decedent to the payment of his debts due the citizens of the local sovereignty. “In practice, the local sovereignty, state or national, permits letters to issue-upon the estates of deceased non-residents, mainly for the purpose of conveniently subjecting such assets to the claims of crcdi tors entitled to sue in the local courts, and for appropriating whatever'balance may remain to the state or sovereign, by way of distribution, in default of known legatees or kindred.” Id. section 166. While, by comity, the courts of the jurisdiction in which the property is found will recognize the rights of nonresident legatees and heirs, and will permit any surplus, after paying the local indebtedness, to be paid over to the domiciliary adniinistrator or executor, it is only done in a spirit of comity and as a matter of judicial discretion. The local sovereignty may compel them to come into its own jurisdiction to receive what -belongs to them. “The rule to thus pay over is not, however, absolute; on'the contrary, the transfer will not be made if deemed, under the circumstances, improper; and legislative policy is to secure the rights of its creditors and citizens at all hazards. * * * * * For the spirit of comity does not require that citizens shall be put to the inconvenience and expense of proving and collecting their claims abroad when there are assets at hand.” Id. section 174. Another matter worthy of consideration in this connection is, that the West Virginia administrator could not, as such, sue in the courts of Virginia, if at all, without making settlement there of his administration accounts, and it may be doubted whether he could sue at all in Virginia, where there is another administrator of the same intestate, except as a creditor. If not actual obstacles, there are inconveniences, standing in the way of this plaintiff, if he should be turned out of the courts of this state and compelled to go to Virginia to enforce reimbursement.

Another contention is that the fund in the hands of S. B. McClung cannot be treated as assets of the estate of plaintiffs intestate because it has be^en 'turned over to Mrs. Sieg: If it were uncollected and unadinirlistered assets, there is no ground upon which this suit could be resisted. But it is claimed that it has been collected with the consent of the plaintiff by the Virginia administrator and distributed by him, and that, in consequence thereof, the West Virginia administrator, not having paid it to Mrs. Sieg, cannot lie reimbursed out of that fund. Under the principles of law governing the relations of ancillary and domiciliary administrators, the collection and distribution of the West Virginia assets by the Virginia administrator, with the consent of the West Virginia administrator, is equivelant to such collection and distribution by the West Virginia administrator. The'Virginia administrator could make no collections here except with the consent of McClung. Schouler’s Ex. & Adm’r. section 173.

But it is contended further that the greater part of the money in the hands of S. B. McClung and claimed by Mrs. Sieg never was the property of plaintiffs intestate but that it belonged to Mrs. Sieg herself. She is the sister of S. B. McClung and, on the partition of the real estate of their father in 1867, there became due to her from her brother, $250.00 as owelty of partition. Her husband loaned McClung some additional money and took his note payable to himself for his own money and the money due his wife. The $100.00 hereinbefore mentioned is money that Mrs. Sieg loaned her brother, S. B. McClung. Granting, for the purpose of discussion, that all this money belonged to Mrs. Sieg and never was a part of the assets of James M. Sieg, it is liable to be subjected to the payment of plaintiffs claim. Her liability to refund is contractual in its nature and not only the specific fund or property which she received for her distributive share, but any other property belonging to her and found in. the state of West Virginia, which, by its nature, may be subjected to the payment of her debts generally, is liable., The only limitation is, that she shall not be compelled to pay' back more than.she has'received from the estate. There is no possibility of her being compelled to do that in this case for the reason that she does not deny having received from the estate $2,551.00, while the plaintiff here only claims $1;028.62. There is certainly no rule which limits the recovery so as to make it payable only out of these specific funds or property received by the distributee, tip authority for any such limitation is offered.

Upon the authority of Steele v. Harkness, 9 W. Va. 13, it is claimed that the suit had abated and the court lost jurisdiction because an order of publication was not taken upon return of the process but was subsequently taken. The case of Steele v. Harkness does not apply here, for the reason that it does appear here, as it did not appear there, by affidavit, that the defendants, except S. B. McClung, were non-residents. At any rate, the case of Brown v. Gorsuch, decided at the last term of this Court, settles this question, for it is there held that, in such case, the plaintiff shall have a reasonable time in which to perfect his proceedings by order of publication. Moreover, this record shows that the original summons was returnable on the first Monday in June, 1897, and that a copy of it was delivered to a member of Mrs. Sieg’s family on the 20th day of May, 1897. But that service was probably not good for the reason that the return does not show in what county the service was made. On the 8th day of June, 1897, which was the return day of the first summons, a second summons was sued out and a copy of that was, on the 12th day of June, 1897, delivered to Mrs. Sicg at her residence in Highland county, Virginia. This was equivalent to an order of publication. At some time in the year 1898, Mrs. Sicg appeared and filed her demurrer for it appears that on the 20th day of June, 1898, the demurrer was overruled. In the printed record there is a paper called , a separate demurrer and answer of Mrs. Sieg but there is no order filing her answer. Her appearance gives the court jurisdiction as to her. Lumber Co. v. Lance, decided at this term. But, in overruling the demurrer the court referred the case to a commissioner without giving a day to answer. This is assigned as.error. According to Neely v. Jones, 16 W. Va. 625; Goff v. McBee, 47 W. Va. 153, it was error. But it cannot possibly be prejudicial for that order was interlocutory, and did not affect the merits, and Mrs. Sieg had more than a year after that in which to file her answer before final decree In the two cases referred to, final decree was made immediately upon filing the answers This case, in' respect to that order of reference and the answer, is like the case of Foley v. Ruley, 43 W. Va. 513, where it is held that a mere order of reference, deciding nothing, may be made without answer. Manifestly, it was not the duty of the plaintiff to compel Mrs. Sieg to answer, and while the Court made no order giving her time, the record shows that she did have more than a year after her appearance in which to file her answer.. Hence, she cannot complain of her own failure to answer.

The decree of the 10th day of November, 1899, requiring S. B. McClung to pay over the money to I). G-. McClung, administrator, was erroneous, for the reason that at that time the court had not judicially determined how much the plaintiff- was entitled to require Mrs. Sieg to refund. ' It was not a suit to recover unadministered assets, but one to compel reimbursement, and she could not be required to pay over to him more than was necessary to reimburse him. By that decree, the report of the commissioner, formerly made in the cause, was recommitted without confirmation. However, on the 9th day of April, 1900, after the commissioner had again reported, the court confirmed his report and found that after applying, on the claim of the plaintiff, all of the money which had been paid to him by S. B. McClung under the former decree there yet remained due him and unpaid $-121.98. The appeal and supersedeas were not obtained until the 9th day of April, 1900. Thus, before the erroneous decree was appealed from, the court had determined the amount to which the plaintiff was entitled and applied the fund in controversy to its satisfaction. Hence, the error in the decree of November 10, 1899, was substantially co^ected_by another decree before the appeal was taken. At any rate, it is made certain by said subsequent decree that the error in the former one was not prejudicial. To warrant a reversal, the error complained of must be prejudicial. Clark v. Johnson, 15 W. Va. 804.

There being no error in the decree, it is to be affirmed.