Newcomb v. Trustees of St. Peters Church

2 Sand. Ch. 636

Opinion

The Assistant Vice-Chancellor.

I will first consider the case as it is made out against St. Peters Church.

Without expressing any opinion as to the sufficiency of the proof of the execution of the bond and mortgage, or as to its being originally a valid corporate act; I think there is an insuperable difficulty in the way of any decree against the church for its payment.

More than twenty-six years ‘had elapsed after the bond and mortgage became due, before this suit was commenced. The mortgagees were all residents of this state ; and there is no evidence of any recognition whatever of the mortgage by the corporation or its officers during the whole of that period. The presumption that the mortgage was paid or satisfied, arising from the lapse of time, is conclusive, unless there is some circumstance in the case which takes it out of the general rule.

Footnotes

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(a)

The complainants rely upon two points as obviating the force of the rule; first, that there was a trust; and second, that there was fraud. As to the trust, whatever there may have been in regard to the executors, there was none between the church and the legatees. The church claimed the two legacies, and so far as I can discover, claimed them in good faith. Whether they had any right to them or not, is a different question, and quite immaterial to the present inquiry. The executors paid them to the church, but having doubts as to the legality of the claim, took the bond and mortgage for their indemnity. If the payment turned out to be unauthorized, the executors would have been compelled to pay the amount to the testator’s sisters, but the latter would have had no direct remedy against the church. The extent of their possible right to enforce the mortgage was this. If the-, executors had proved to be insolvent, so that the sisters could not collect the unauthorized payments from them, equity would have permitted them to enforce the bond and mortgage against the church; either as a security held by their debtors which in such a case ought to enure to their benefit, or on the same principle that they might pursue a specific chattel of theirs, which could be identified, in the hands of a third person. But there was no trust or.confidence, in regard to the transaction, existing between the church and those legatees.

So as to the fraud. Much that I have said is applicable to this point. There is no trace of any collusion between the church and the executors, either in the payment of the two legacies, or in concealing from the residuary legatees the existence of the bond and mortgage. And unless there was bad faith in obtaining the payment, or a fraudulent collusion subsequently, I do not see how the charge of fraud against the church is to be sustained.

Aside from the bond and mortgage, the legatees have still less ground for exacting from the church, a return of the sums paid to the latter in 1812.

If there were any error in the payments, it was one of law as to the validity of the two legacies, so that the executors could not recover them back; much less could other legatees reclaim them in the absence of fraud or mistake of fact. And as to the residuary legatees, if the church had no other ground of defence against them, their acquiescence in the payments in the various proceedings in this court against the executors, constitutes an effectual bar to reclaiming such payments at this day.

The bill must therefore be dismissed as to St. Peters Church, and the defendant James Kerrigan.

Second. The claim made by the complainants against Heeney, the surviving executor of Reed.

As I have no doubt of the validity of the legacy of $2000 to the free school of St. Peters Church, this part of the investigation may be limited to the legacy of the dividends of twenty shares of Manhattan stock.

The twenty shares of stock were of the par value of $1000, but having been sold by the testator in his lifetime, the legacy was unquestionably adeemed.(a)

The executors nevertheless paid one year’s interest to the church on the $1000, at the end of a year from the testator’s death, and in less than two months after such payment, they paid the whole sum to the church, with the other legacy of $2000. The mortgage was not taken till more than a month after paying the legacies.

1. How does the case stand in reference to the administrator of Mary Mathews?

In 1817, she filed a bill in this court, against Reed’s executors for an account, which she prosecuted to a final decree. The accounts of the executors were taken by a master in that suit, in 1822, when these transactions were comparatively fresh, and when the two residuary legatees were living, and competent to judge of the propriety of the payment of the legacy of $1000, under the circumstances, and Mary Mathews was competent to affirm it.

All the payments to the church were brought forward by the executors in that accounting, and were allowed by the master. They appear in his report so plainly and distinctly, that they could not have been overlooked or misunderstood by Mathews’s agent, or her solicitor or counsel. The master’s report shows how the word check came to be appended to nearly all the discharges credited to the executors, which was by reason of his using their bank book entire, for both charges and dischargesNo exception was taken by Mathews to the report. On the contrary, she immediately obtained a decree upon it, and received the sum which was thereby awarded to her.

Her suit was founded on the will of Reed. She therefore knew of the gift of the Manhattan stock. The executors accounts before the master showed that they received no such stock, because there is no credit or statement for either the stock or its proceeds. The same accounts showed to her that they paid cash to the church, both interest and principal, and that they had not either paid dividends on the stock or transferred the stock itself.

Mary Mathews, (or those acting for her, which is the same thing,) knowing all these matters, either opposed the allowance of the payments, or assented to their propriety.

If she contested them, the decision of the master concluded her. It is more probable, and more creditable to her to believe, that she cheerfully acquiesced in the payment by which her brother’s pious-provision for masses for the repose of his soul and those of his relatives, was carried into effect. To her, if educated in the same faith, this doubtless appeared to be a holy and most sacred object, although to others it may seem superstitious.

On every hand, it therefore appears that she was concluded by the accounting in 1822.

The complainants attempt to avoid this conclusion, by showing that the confirmation of the payment of the legacy was made in ignorance of the existence of the bond and mortgage; and that their existence was fraudulently concealed from the residuary legatees, by the executors,

Heeney’s answer shows that the bond and mortgage were not produced before the master on the accounting. But there is no fraudulent suppression or concealmen t of them established. The answer of Heeney, which is responsive to the strong charges in the bill on this subject, as well as to the interrogatory thereon, is proof in his favor that there was no fraud or suppression, and that he had forgotten the existence of those securities.

It thus appears that they were not produced, but that the omission was not intentional. The executor who had originally taken and retained them, was at that time dead; and there is no proof of any suppression or concealment on the part of the other executor, Morris.

I think it should be assumed that the residuary legatees, were ignorant of the existence of the bond and mortgage.

The sole question as to Mary Mathews, is thus reduced to this point; does her ignorance of that fact, impair or destroy the effect of the allowance of the payments to the executors, by the master on the accounting'!

If she contested the allowance, her ignorance was perfectly immaterial, because the bond and mortgage would not have made the payment any more or any less valid. I have supposed it probable that she did not contest it. If I were to act on that probability, instead of proof, it is based on her regard for her brother’s wishes, and upon her supposed religious views and belief. In respect of these also, the bond and mortgage could have had no influence.

It was urged that she may have confirmed the payments, because she supposed their disallowance would work a total loss of the amount to the executors, or subject her to a quarrel with her mother church. I cannot give any heed to the suggestion that the idea of a loss to the executors influenced Mathews or her agent in the slightest degree; for the master’s report contains many charges made against them striciissimi juris, and shows that the accounting was rigid and unrelenting on the part of the complainant. As to the other suggestion, fear of the church, it certainly would have been quite as cogent a motive if she had known all about the bond and mortgage. An attempt to reclaim the money thus devoted and used for masses for her dead kindred, would have been as sacrilegious and as likely to lead to anathema, if it were made through these securities by Mary Mathews, as if it were pressed through a suit against the executors.

In my judgment, the existence of the bond and mortgage was in no wise material to be made known to her, and the accounting is equally conclusive as if she had known all the facts connected with them.

The will, the payments and their time and manner, their legal effect, and the fact that there was no Manhattan stock, are to be taken as fully within her knowledge. Her remedy was a plain one; it was against the executors, and it is not disputed that they were able to respond to it. "Whether they were ultimately to lose the amount paid, or had indemnity for it, was a matter of entire indifference to her and to her rights.

The answer of Heeney proves that the bond and mortgage were a subsequent act; and were in truth for the sole indemnity of the executors, embracing both the valid legacy, and the one which was adeemed. To the executors, they were equivalent to the bond which the statute then prescribed to be given by legatees on receiving payment, (1 Rev. Laws, 314, § 18.) They were not an investment, and the executors could not have turned them over as such to either of the legatees, without her consent.

The fact that these executors had taken such indemnity, could not in any degree influence the legal conclusion of the master or of the complainants, in regard to allowing" them for the payment of the legacy of f1000. And if I am to speculate on the motives, which aside from an erroneous conclusion as to the validity of the legacy, influenced its allowance, I find they are motives that would not have been affected by a knowledge of the bond and mortgage.

I must therefore, hold that Mary Mathews was barred by the accounting before the master. I have not considered whether the effect would have been otherwise, in case a knowledge of the bond and mortgage had been important to her allowance of the payments.

2. The administrators of Bridget O’Brien present a different cose in some particulars, from that of Mary Mathews.

Provision was made for her in the decree in Mathews’s suit, and the accounting before the master embraced not only the whole estate to that time, but also the separate payments made to the residuary legatees.

There is no evidence however, that she was a party to that suit; by going in before the master or otherwise; and the accounting and decree would not of themselves affect her rights. But it appears that she subsequently filed a bill founded upon the decree, to recover of the executors of McCarty the sum thereby directed to be paid by them to her; and she received such sum or a part of it, from them in consequence of that proceeding.

■ it is in vain to say that it does not appear that she knew of any thing more than the decree. The law charges her with notice of all the proceedings in the suit which led to the decree, so far as they were on record and affected her rights; and she could not shut her eyes to the contents of the executors accounts, while she availed herself of the balance found and reported by the master, and decreed by the court.

I think that her representatives are precluded by these circumstances, from going back of the accounting in the suit of Mathews.

It. is indifferent to this conclusion, whether Bridget O’Biien was a feme covert or not in 1822. If she were, the legacy was recoverable by her husband, and his suit for it would bind her, so far as this question is concerned.

Another and a conclusive bar to her administrators, is found in the decrees and other proceedings in the suit instituted by Terence O’Brien and his wife in 1832, and revived by her administrators. That was a bill fora general account of the administration of Reed’s estate. The decretal order in that suit directing a master to take the accounts, is limited to the time subsequent to the Mathews decree, and adopts the result in the Mathews accounting, as its basis for the previous period; and the same ground was taken by Heeney before the master, and was adopted by him. The decrees in the O’Brien case, decide that the accounting in 1822 is binding upon Mrs. O’Brien’s representatives, as well as upon those of Mathews. They are a judicial determination of the point, which is not to be drawn in question in this court.

The silence of Heeney on this reference in regard to the bond and mortgage, is alleged to be fraudulent. There is the same answer to the fraudulent intent as was given before. But there was less reason for his remembering the securities on this occasion, than there was on the reference before Master Drake, thirteen years before. The legacies to the church were allowed in 1822, and the account closed. They were not in controversy in 1835, and could not be controverted under the decretal order in the suit of O’Brien’s.

On whatever ground the court proceeded in 1835, in holding the former accounting binding upon the O’Brien’s, the decision cannot now be disturbed.

If it be said that the force of the decrees in the suit of O’Brien’s administrators ought to be in any manner influenced by her and their ignorance of the bond and mortgage; the considerations which I have already mentioned in reference to Mary Mathews, are applicable to this argument in behalf of Mrs. O’Brien.

The bill must be dismissed as to the defendant Heeney.

The question of costs is not without its difficulty. I think upon the whole, that the suit is not wantonly brought against either of the defendants, and the bill will be dismissed without costs.

See Campbell v. Graham, 1 Buss. & Mylne, 453.

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See Robinson v. Addison, 2 Beavan, 515.