People ex rel. Foster v. Chicago Bonding & Surety Co.

216 Ill. App. 375, 1920 Ill. App. LEXIS 339
CourtAppellate Court of Illinois
DecidedJanuary 26, 1920
DocketGen. No. 25,349
StatusPublished

This text of 216 Ill. App. 375 (People ex rel. Foster v. Chicago Bonding & Surety Co.) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
People ex rel. Foster v. Chicago Bonding & Surety Co., 216 Ill. App. 375, 1920 Ill. App. LEXIS 339 (Ill. Ct. App. 1920).

Opinion

Mr. Justice Holdom

delivered the opinion of the court.

Defendant was surety on the bond of Charles H. Graves, conservator of the estate of Laura E. Williams, an insane person, in the prohate court of Cook county. The bond is in the penalty of $5,600. The lunatic died and Clara M. Foster was appointed executrix of her will and estate by the probate court of this county. Gfraves, the conservator, settled the estate of his ward after her death in the probate court, and the court found on the rendition of his final account that there was in his hands as such conservator the sum of $1,942.72, and ordered him to pay the same to the executrix, Foster, within 30 days; this he failed to do. Thereupon this suit was commenced to secure payment from defendant.

The order of the probate court directing payment of $1,942.72 remains in full force, unchallenged by any subsequent legal proceedings. The breaches of the conservator’s bond in suit assigned in the declaration are that Craves filed in the probate court on December 20, 1916, his final account as conservator showing a balance in his hands of $1,942.72; that thereafter on May 21, 1917, the probate court ordered Craves as conservator to pay the sum found in his hands to the usee plaintiff within 30 days from the date of the entry of the order, which order is in full force, not reversed, annulled or satisfied; that demands have been made upon Craves for payment, but that he has not paid the same or any part thereof, but has wasted, converted and disposed of said moneys to his own use.

On a trial before the court without a jury there'was a finding and judgment in favor of plaintiff for $42.50. Plaintiff being dissatisfied with the amount of the judgment prosecutes this appeal and asks for a reversal and for a judgment in this court for the whole amount ordered paid by the probate court with interest.

The defense interposed was that all the items except the $42.50 were a personal debt from Craves to his ward prior to his appointment as conservator of her estate and prior to the execution of the bond in suit; that at no time after his appointment as conservator did Graves have in his possession any of such items; that defendant as surety was only liable for such sums as came into the possession of the conservator after the execution of the bond, and the defendant is not liable for the failure of Graves as an individual to pay to himself as conservator money which he owed his ward prior to his appointment and the giving of his bond. Graves as conservator failed to inventory the disputed items, and the probate court by a suitable order coerced Graves to include the items in his inventory as conservator.

Defendant contends that this the court had no right to do for two reasons: First, that the items were debts due to Graves’ ward that were contracted prior to his appointment as conservator; and, second, that Graves was insolvent and financially unable to pay and that therefore the surety on the bonds is not liable, as the debt is personal and not official.

In the first place we will assume that the judge of the probate court found under the proofs before him that Graves was solvent and able financially to respond to his ward for his indebtedness to her. If such assumption was rebuttable, there is no rebutting evidence in this record. The record is silent as to the proofs which were before the probate judge at the time the order on Graves to include the disputed items in an amended inventory was made.

It is the law in this State that where a debtor is appointed conservator of his creditor’s estate and has at the time of such appointment sufficient property to pay his debts, including "the one to the estate, the law regards the debt to the estate as paid and the amount thereof as cash in the hands of such conservator, notwithstanding he may subsequently become insolvent. This is the rule which the probate judge applied to Graves’ debt to his ward.

In Wachsmuth v. Penn Mut. Life Ins. Co., 241 Ill. 409, it was said:

“Appellees contend that when a debtor is appointed administrator of his creditor’s estate the debt is considered paid and the administrator is chargeable with the amount thereof in the settlement of his accounts, regardless of the financial condition of the administrator. This contention is supported to the full extent claimed by appellees by the Supreme Court of Massachusetts in Leland v. Felton, 1 Allen 531; by the Supreme Court of Ohio in McGaughey v. Jacoby, 54 Ohio St. 487; by the Supreme Court of New Hampshire in Judge of Probate v. Sulloway, 68 N. H. 511, and by the Supreme Court of Alabama in the case of Wright v. Lang, 66 Ala. 389. It will thus be seen that the rule contended for is not without support. The reason upon which these decisions rest is that the administrator cannot sue himself, and that therefore when he is appointed his debt to the estate is by a fiction of law regarded as collected and paid to himself, as administrator. The rule laid down in the foregoing cases, which is known as the Massachusetts rule, has been modified by later cases in other States so-as to permit the administrator to show that he was insolvent at the time of his appointment and so remained during the term of his office, and thus relieve himself from the consequences of failing to pay over money which he never, in fact, had and was wholly unable to obtain. The rule in its modified form is applied in the following cases: In re Walker, 125 Cal. 242; Baucus v. Stover, 89 N. Y. 1; Baucus v. Barr, 107 N. Y. 624, affirming 45 Hun 582; McCarty v. Frazer, 62 Mo. 263; Parker v. Irick, 10 N. J. Eq. 269; Rader v. Yeargin, 85 Tenn. 486; State ex rel. McClamrock v. Gregory, 119 Ind. 503.

“In the case last above died the Supreme Court of Indiana uses the following language: ‘One question which seems to have been overlooked on the trial of the cause was the financial condition of Levin T. Miller, the administrator, during the period of his administration, The money collected by him while professing to act as the agent of the administrator in Missouri, and for which he had not accounted when he became administrator, was a claim in favor of his trust, which he should have inventoried and charged himself with, and if by the use of due diligence all or any part of the claim could have been saved to the estate his sureties are therewith chargeable, but if he was hopelessly insolvent they do not become liable therefor, the burden as to the question of insolvency being on the administrator and his sureties.’ Further on in the opinion the court says: *The debt of the administrator is to be accounted for as other debts or assets, and he may show his insolvency during the period of administration in discharge of his official liability. ’

“So far as we are advised this question has never been passed on by this court. ’ ’

The court in ease, supra, settled the rule regarding this situation in this jurisdiction in the following language:

“Where, however, the administrator is solvent, no such hardship can be imposed upon either the sureties or the administrator. . The rule thus applied will accomplish the desired end in most cases and avoid the harsh consequences that would occasionally result from the application of the unrestricted Massachusetts rule. ’ ’

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Related

Baucus v. . Barr
13 N.E. 939 (New York Court of Appeals, 1887)
Baucus v. . Stover
89 N.Y. 1 (New York Court of Appeals, 1882)
Walker v. Walker
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Wright v. Lang
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Nevitt v. Woodburn
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McDonald v. People
78 N.E. 609 (Illinois Supreme Court, 1906)
Wachsmuth v. Penn Mutual Life Insurance
89 N.E. 787 (Illinois Supreme Court, 1909)
State ex rel. McClamrock v. Gregory
22 N.E. 1 (Indiana Supreme Court, 1889)
McCarty v. Frazer
62 Mo. 263 (Supreme Court of Missouri, 1876)
Rader v. Yeargin
85 Tenn. 486 (Tennessee Supreme Court, 1887)
People ex rel. Zimmer v. Pacific Surety Co.
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Rahe v. Jobusch
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Bluebook (online)
216 Ill. App. 375, 1920 Ill. App. LEXIS 339, Counsel Stack Legal Research, https://law.counselstack.com/opinion/people-ex-rel-foster-v-chicago-bonding-surety-co-illappct-1920.