North v. Hawkinson

324 S.W.2d 733, 1959 Mo. LEXIS 847

• Court: Supreme Court of Missouri
• Decided: April 13, 1959
• Docket: 46277
• Status: Published

Opinions

BOHLING, Commissioner.

Harry J. North filed an action against Esther C. Hawkinson, executrix of the estate of Axel Hawkinson, deceased, in the Circuit Court of Jackson County based on an alleged oral partnership agreement between plaintiff and Hawkinson. The case is pending on resubmission. Defendant’s motion to dismiss plaintiff’s petition was sustained on the stated grounds plaintiff failed to state a claim upon which relief could be granted; laches; and, if a claim be stated, it was barred by sections 473.360 and 473.-367 of the new Probate Code (Laws 1955, pp. 385 et seq., §§ 139 and 141). Statutory references are to RSMo 1949, 1955 Supplement, and V.A.M.S. unless otherwise stated. The sole controverted issue presented for determination on resubmission is whether plaintiff’s action is barred by sections 473.-360 and 473.367, the nine months limitations of the Probate Code of 1955 ; and defendant tacitly concedes plaintiff’s petition, if not barred, states a claim and does not disclose laches necessarily defeating the action.

Mr. Hawkinson died March 3, 1956. His wife was appointed executrix of his estate March 14, 1956. The first published notice of letters testamentary was on March 19, 1956, and more than nine months thereafter plaintiff’s petition was filed; to-wit: March 12, 1957. It was captioned “Bill in Equity for Adjustment of Partnership Accounts.” The material allegations are to the following effect: In 1938 plaintiff and Hawkinson entered into an “oral partnership agreement” to speculate and invest in real estate. Hawkinson agreed to finance this business. Plaintiff was to purchase and improve real estate for resale at a profit, was to sell real estate for and obtain agency agreements for leasing the property of owners on a commission basis, and the profits arising from the partnership were to be divided equally between the partners. Plaintiff, acting under the agreement, purchased, improved (investing some of his money in addition to money advanced by Hawkinson) and sold some of the properties at a profit, taking back long-term installment purchase money mortgages, and obtained, on a commission basis, agency agreements to sell and to lease, under long- and short-term leases with options to renew, property for the owners. In December, 1940, the partners mutually agreed the partnership would be dissolved; but as a large number of transactions were pending in which the partnership was interested, it was agreed that Hawkinson, without compensation for his services, would continue to handle said transactions, keep an account of the receipts and disbursements connected therewith, and eventually close out the partnership business. Any net losses or profits were to be shared equally by plaintiff and Hawkinson. This arrangement continued from 1940 until Hawkin-son’s death in 1956 without any settlement of the partnership affairs or any partnership transaction involved, and commissions and profits on many partnership transactions are still outstanding. Plaintiff charges that Hawkinson “was a trustee of the firm’s accounts and the transactions constituted a mutual running and current account between them” of the partnership business, and that the existence of said relationship was always recognized by plaintiff and Hawkinson. Plaintiff alleges he has no adequate remedy at law; that only an accounting can determine the amount owed plaintiff, stating he “verily believes” he is entitled to a judgment of $80,000 against the estate of Hawkinson.

Plaintiff states his action is purely an equitable matter over which the probate court has no jurisdiction, and the limitation periods of the Probate Code are not applicable. Orr v. St. Louis Union Trust Co., 1922, 291 Mo. 383, 236 S.W. 642; Hess v. Sandner, 1917, 198 Mo.App. 636, 198 S.W. 1125, 1126; and cases following the language of the Orr case, Clay v. Walker, Mo.App.1928, 6 S.W.2d 961, 967; Bond v. Unsell, Mo. App.1934, 72 S.W.2d 871, 874; In re Main’s Estate, 1941, 236 Mo.App. 88, 152 S.W.2d 696, 700; Cunningham v. Kinnerk, 1934, 230 Mo.App. 749, 74 S.W.2d 1107, 1113. These cases arose under the prior Probate Code, the new Probate Code having been enacted by Laws 1955, p. 385, to be effective January 1, 1956 (Id., § 1). The Hess, Bond and perhaps other cases state or indicate probate courts only had jurisdiction of claims involving a debtor-creditor relationship.

This is a case of first impression under the new Probate Code. Consult Model Probate Code, Michigan Legal Studies, 1946, Simes. Apparent purposes of the code are to provide a speedy method for administering a decedent’s estate, to establish a time after which claims are forever barred against the estate, the executor or administrator, and the distributees, and to broaden the jurisdiction of probate courts to accomplish said purposes. A discussion of some features of the Code may be found at 23 Mo.L.R. 113.

We first state the constitutional and statutory provisions bearing on the issue, with some observations in connection therewith. They read (emphasis ours) :

The constitution vests probate courts and circuit courts with “judicial power.” Art. 5, § 1, V.A.M.S.

“There shall be a probate court in each county with jurisdiction of all matters per-taming to probate business, to granting letters testamentary and of administration, * * * settling the accounts of executors, administrators * * * and the sale or leasing of lands by executors, administrators, * * * and of such other matters as are provided in this constitution.” Id., § 16. (Emphasis ours.)

“Probate courts shall be courts of record and uniform in their organization, jurisdiction and practice * * * Id., § 17.

“The circuit court shall have * * * exclusive original jurisdiction in all civil cases not otherwise provided for, and concurrent * * * jurisdiction as provided by law.” Id., § 14.

Section 473.360, subd. 1. “Except as provided in sections 473.367 and 473.370, all claims against the estate of a deceased person, * * * whether due or to become due, absolute or contingent, liquidated or un-liquidated, founded on contract or otherwise, which are not filed in the probate court within nine months after the first published notice of letters testamentary or of administration, are forever barred against the estate, the executor or administrator, the heirs, devisees and legatees of the decedent.

“2. All actions against the estate of a deceased person, pending or filed under sections 473.363 or 473.367, shall abate or shall be barred unless notice of the revival or institution thereof is filed in the probate court within nine months after the first published notice of letters.” Consult prior sections 464.020, 464.060 and 464.070.

Plaintiff mentions the following excerpt from the “Committee Comment” to section 473.360 as favorable to his position: “(3) it does not expressly bar equitable claims (such as that decedent held property in trust) but under present laws such claims are not barred because the probate court has no equitable powers [Citing the Orr case, supra.]” Such comments are not always accurate. This comment is taken from the “Final Report of the Joint Probate Laws Revision Committee” to the General Assembly, is dated January 5, 1955, and has reference to the prior Probate Code. The comment with regard to par. 2 reads: “Subsection 2 is new and is self-explanatory.”

Section 473.367. “Any action commenced against an executor or administrator, after death of the decedent, is considered a claim duly filed against the estate from the time of serving the original process on the executor or administrator and the filing of a copy of the process and return of service thereof in the probate court.” Consult prior section 464.070.

Chapter 516, relating to the “Statutes of Limitations,” “Real Actions,” and “Personal Actions and General Provisions” (sections 516.010-516.370), provides in section 516.300: “The provisions of sections 516.-010 to 516.370 shall not extend to any action which is or shall be otherwise limited by any statute; but such action shall be brought within the time limited by such statute.”

“Generally, an action is such a judicial proceeding as, conducted to termination, results in a judgment.” State ex rel. Silverman v. Kirkwood, 361 Mo. 1194, 239 S.W.2d 332, 336 [6], “And, ‘suits’ or ‘actions include those proceedings which are instituted and prosecuted according to the ordinary rules and provisions relating to actions at law or suits in equity.’ ” State v. Dalton, 353 Mo. 307, 182 S.W.2d 311, 312 [3]. Section 506.040 (from Laws 1943, p. 353, § 4, repealing and reenacting, among others, § 847, RS 1939) provides: “There shall be one form of action to be known as ‘civil action.’ ” Articles 8 and 9, now sections 516.010 to 516.370, was part of Chapter 6, “Civil Procedure — General Code,” RS 1939, not repealed by Laws 1943, p. 353, supra; and the word “action” in statutes of limitation applies, as prior to Laws 1943, p. 353, to the one form of action theretofore existing under said prior § 847 for the enforcement and protection of private rights or the redress or prevention of private wrongs. See State v. Harold, 364 Mo. 1052, 271 S.W.2d 527, 530 [9].

Circuit courts have concurrent jurisdiction with probate courts over claims against an estate under section 473.370, subds. 1 and 2. Consult prior section 464.-080; Barnes v. Boatmen’s Nat. Bank, 355 Mo. 1136, 199 S.W.2d 917, 918-920 [1]; Pryor v. Kopp, 342 Mo. 887, 119 S.W.2d 228, 229 [1-3]; Wahl v. Murphy, Mo., 99 S.W.2d 32, 35 [5].

Executors and administrators are to return an inventory of all property of the decedent (section 473.233, subd. 1), “including the decedent’s proportionate share in any partnership” personal property (Id., (6)), and “all property possessed by the decedent at his death but claimed to be owned by another shall be listed in the inventory, but separately from other property, together with a statement as to the knowledge of the executor or administrator as to its ownership” (Id., (7)).

Upon the death of a member of a partnership, the Probate Code provides for the filing of an inventory of the partnership assets in the probate court (section 473.220); for the continuation of the possession, etc., of the partnership estate by the surviving partner and an accounting to the executor or administrator of the decedent (section 473.223); and, in stated circumstances, for ordering the partner to account and file a bond and appoint a receiver of the partnership estate with like powers and duties of receivers in chancery (section 473.230).

Section 472.010, subd. 3 defines: “ ‘Claims’ include liabilities of the decedent which survive whether arising in contract or in tort or otherwise * *

Section 472.020 follows the outline of Mo.Const., Art. 5, § 16 and, so far as material, provides: “The probate court has jurisdiction over all matters pertaining to probate business * *

Section 472.030 provides: “The court has the same legal and equitable powers to effectuate its jurisdiction and to enforce its orders, judgments and decrees in probate matters as the circuit court has in other matters * *

Section 473.357 authorizes the probate court, upon a verified petition of a claimant alleging that the executor or administrator is in possession of personal property not owned by decedent but owned by claimant and wrongfully withheld from him, to hear, try and adjudge the title to such property.

In the second count of the petition in Orr v. St. Louis Union Trust Co., 1922, supra, considered a leading case, a wife sought to establish a trust against the estate of her deceased husband, and one defense interposed was the one year non-claim statute of the previous probate code (see Ch. 2, Art. 7, §§ 191-195, RS 1909). Division II of this court held (236 S.W. 649 [8]): “Mrs. Ghio’s claim involved the establishment of a trust and an accounting, matters of an equitable nature, and therefore not cognizable before a probate court in the administration proceedings, and such claim is not barred by her failure to exhibit her claim in said court against testator’s estate.”

State ex rel. Stetina v. Reynolds, Banc 1920, 286 Mo. 120, 227 S.W. 47, 48, was on certiorari to review a court of appeals ruling disallowing a portion of a demand filed in the probate court against a decedent’s estate on the ground decedent was a trustee of an unsettled and unascertained trust cognizable only in equity and the probate court had no equitable jurisdiction. In quashing the record of the court of appeals the court quoted the following from Hoffmann v. Hoffmann’s Ex’r, 1895, 126 Mo. 486, 493, 29 S.W. 603, 605: “The constitution of the state gives to the probate courts jurisdiction “over all matters pertaining to probate business.” As a matter pertaining to probate business, the statute declares that “the probate court shall have jurisdiction to hear and determine all suits and other proceedings instituted against executors and administrators upon any demand against the estate of the testator or intestate.” This provision seems broad enough to include all money demands, of whatever nature, whether legal or equitable, and so it was held in Hammons v. Renfrow, 84 Mo. [332,] 341.”

A motion to transfer the Orr case to Court en Banc on 'the ground of conflict with the last three mentioned cases was overruled, Division II stating (236 S.W. 650) : “No question of following a trust, fund into specific real estate and establishment of a lien therein for a portion of the trust fund was involved in either of the cases. The cases may thus be distinguished from the case at bar. It is true, language is used in one or more of the cases above referred to indicating that the jurisdiction of the probate court is broad enough ‘to include all money demands of whatever nature, whether legal or equitable,’ so long as the claim is based on a demand against the estate of a deceased person. But the facts in those cases did not call for any such sweeping declaration, and it seems there was no intention thus ruthlessly to sweep aside the rule laid down in the cases cited in our original opinion in this case.” This language considered the Orr action one to enforce a trust or an equitable lien on specific property and not barred by the then nonclaim statute, and the dicta of the Orr case criticizing Court en Banc’s opinion in State ex rel. Stetina appears to be subject to the observation of the Orr case that “the facts * * * did not call for any such sweeping declaration.” The rationale of Helliker v. Bram, infra, repudiates in principle the broad language on the motion to transfer in the Orr case.

Helliker v. Bram, Mo.1955, 277 S.W.2d 556, was an action for personal injuries and property damages filed against decedent’s estate¹ after the lapse of the one year limitation of prior section 464.020. After stating the material portions of sections 464.010, 464.020, 464.060, 464.070, and 464.-130, reviewing a number of cases relied on by the instant plaintiff, and remarking that probate courts did not have jurisdiction to adjudicate tort actions, the court held (277 S.W.2d 561): “But, that does not mean that a cause of action in tort (which, when reduced to a judgment, becomes a debt payable out of the assets of the estate), should not be subject to the same limitations as any other form of demand allowable against the estate. Such a construction is permissible in view of the broad and all inclusive language contained in Chapter 464, and is in accord with the public interest which is promoted by the prompt settlement of the estates of deceased persons.”

Commerce Trust Co. v. Farmers’ Exchange Bank, Banc 1933, 332 Mo. 979, 61 S.W.2d 928, 89 A.L.R. 373, involved a claim based on the relation of “principal and agent or cestui que trust and trustee, rather than that of debtor and creditor.” 61 S.W.2d 929 [1], Money collected on checks sent to defendant bank had been commingled with its own funds and was incapable of identification on insolvency. The claim and suit were not timely filed within the nonclaim statutes relating to banks in liquidation (sections 5333, 5337, RS 1929; now sections 361.510, 361.550). The court (61 S.W.2d 931 [4]) quoted definitions of the word “creditor”, among which was: “A creditor, in its strict, legal sense, is one who voluntarily trusts or gives credit to another for money or other property, but, in its more general and extensive sense, is one who has a right by law to demand and recover of another a sum of money on any account whatever”; and held “creditors,” as used in the statutes involved, “was used in the general sense above indicated * * * and that it includes claimants in the situation of plaintiff in this case,” and that the nonclaim statute required “the prompt presentation and disposition of all claims of whatever character against an insolvent hank, at least where, as in this and similar cases, the claim is not for possession of specific property hut one in which the claimant seeks * * * to be paid out of the assets in the hands of the liquidating commissioner, inchxding those to which the bank had title.”

It is stated in Logrbrink v. Eugene State Bank, 1948, 240 Mo.App. 517, 209 S.W.2d 265, 271, which has a good review of the Commerce Trust Co. case, supra: “Later decisions of our appellate courts following the pronouncements in the Commerce Trust Co. case have consistently ruled that the statute limiting the time for filing claims and bringing actions against insolvent banks applies to all claims of whatever character, except actions for the recovery of specific personal property, and it also applies to proceedings in equity to reach assets in the hands of liquidating officers. [Citing cases.]”

Many powers exercised by probate courts were originally found in the chancery and ecclesiastical courts of England. Miller v. Iron County, 29 Mo. 122; 1 Pomeroy, Equity Jurisprudence, 5th ed., § 347; 1 Woerner, American Law of Administration, 3d ed., § 140. Among the equitable powers existing in probate courts prior and subsequent to the new Probate Code were jurisdiction over proceedings for the specific performance of a decedent’s contract to sell real estate (consult section 473.303 et seq.); discovery (consult section 473.340 et seq.); “equitable control in making executors and administrators account for interest” etc. (consult section 473.550; Enright v. Sedalia Trust Co., 323 Mo. 1043, 20 S.W.2d 517, 521 [2]). New section 472.020 states probate courts have jurisdiction to construe “wills as an incident to the administration of estates” and “of the administration of testamentary trusts.”

The Constitution requires that the powers conferred on probate courts pertain to probate business (Art. 5, § 16) and that they be uniform (Id., § 17). Our attention is directed to no constitutional restraint on the power of the General Assembly to confer uniform equity jurisdiction on probate courts in “matters pertaining to probate business” (Const.1945, Art. 5, § 16; (section 472.020)), and the General Assembly, in its representative capacity, is free to exercise all the primary power of the people in conferring such uniform equitable jurisdiction. Rathjen v. Reorganized School Dist. R-II, 365 Mo. 518, 284 S.W.2d 516, 526 [20]; Brown v. Morris, 365 Mo. 946, 290 S.W.2d 160, 166 [5].

The equity jurisdiction thus conferred is not the general equity jurisdiction of circuit courts, but plenary equity jurisdiction of “matters pertaining to probate busi-iness.” The 1945 Constitution requires probate judges, except then incumbents, to be licensed to practice law (Art. 5, § 25), and the reason stated in Bauer v. Gray, 18 Mo.App. 164, 169, for withholding equitable powers from probate courts in matters pertaining to probate business has practically ceased to exist.

Plaintiff’s action is for a partnership accounting. He prayed that the cause be referred to a referee, commissioner, or receiver to take and state a mutual account of all transactions between plaintiff and Hawkinson, and to report to the court the balance due from either party to the other, and for judgment for said amount so determined against defendant, interest and costs, and other and further general relief. His position that the ^ction is strictly an equitable matter and not subject to the nonclaim provisions of the new probate code is not well taken. He seeks a money judgment, payable out of the assets of decedent’s estate in the hands of the executrix, for so much as an accounting may establish to be due him. This is not an action for the recovery of specific personal property. His action is barred by his failure to comply with the nine months non-claim provisions of section 473.360, ¶[ 2 or section 473.367 (quoted supra), relating to “all actions” or “any action,” respectively, instituted against an executor or administrator after the death of the decedent. This conclusion finds support in cases under the prior code. State ex rel. Stetina v. Reynolds, Banc, supra, 227 S.W. 47, 48, and cases there cited; Helliker v. Bram, supra, Mo., 277 S.W.2d 556, 561; and, by analogy, Commerce Trust Co. v. Farmers’ Exchange Bank, Banc, supra, 61 S.W.2d 928, 931 [4], 89 A.L.R. 373. See also In re Durant’s Estate, 194 Wis. 275, 215 N.W. 584, 589.

The judgment is affirmed.

BARRETT, C., dissents. STOCKARD, C., concurs in result. LEEDY, J., concurs. STORCKMAN, P. J., concurs in result in separate opinion. EAGER, J., concurs in result and concurs in separate opinion of STORCKMAN, P- J-

1 . Not until Laws 1907, p. 252, could tort actions for injuries to person or health be revived after the death of the tort feasor (Johnson v. Frank, 354 Mo. 767, 191 S.W.2d 618, 62113-7]); and not until 2 Laws 1947, p. 225, could such suits first be instituted after the death of the tort feasor (§ .537.020 as amended).