State Ex Rel. Steinfort v. District Court

107 P.2d 890, 111 Mont. 216, 1940 Mont. LEXIS 29

• Court: Montana Supreme Court
• Decided: December 3, 1940
• Docket: No. 8,134.
• Status: Published

Opinions

MR. CHIEF JUSTICE JOHNSON

delivered the opinion of the court.

For the second time the matter of the claim of Mary Stein-fort against the Estate of John R. Steinfort, deceased, comes before this court on petition for writ of supervisory control or other appropriate writ. On the first occasion, upon the application of Mary Steinfort, a sister of deceased and a claimant against his estate, this court issued a writ directing the district court to permit an amendment of her amended claim after the time for presenting claims had expired. In this proceeding Mary A. Steinfort, the daughter of deceased and administratrix of his estate, seeks a writ directing the district court to annul an order by which after the final amendment it required her “to at once allow or disallow said amended claim of said Mary Steinfort, as in her judgment may appear proper, and file a report of what she does in the premises.”

The claimant appeared herein only by demurrer and motion to quash, and no questions of fact are involved.

Claimant has given three versions of her claim, in each of which she demanded $4,972 and interest from about May 1, 1939, although each version disclosed different amounts paid and therefore different amounts still due. Her claim is upon two notes dated May 1, 1924, aggregating $2,827.13 in amount, and due one and two years later, respectively, with interest at the rate of 6 per cent, per annum. The first sworn claim presented and rejected on July 29, 1939, showed no credits, but as fifteen years had passed, the principal and interest, if entirely unpaid, would have aggregated $5,371.55, and the claim for $4,972 indi cates a credit of $399.55. The “amended claim,” presented, rejected and filed on August 4, 1939, two days before the time for presenting claims expired, shows payment of interest to May 1, 1927, at times not stated; three years’ interest amounts to $508.88, which is $109.33 more than shown by the original claim, and would reduce the debt to $4,862.67 as of May 1, 1939, although $4,972 was still demanded. The amendment of the amended claim was first sought to be made on September 20, 1939, more than six weeks after the time for presentation of claims had expired and sets forth certain payments on undisclosed dates in 1931, 1932, 1933, 1934, 1935 and 1936, and on stated dates in 1925, 1926, 1927 and 1937, aggregating $1,058.89, which is $550.01 more than shown by the amended claim, and reduces the debt to $4,312.66 as of May 1, 1939, although $4,972 is still demanded. The first two versions of the claim suggest that it is barred by the statute of limitations, but the final version shows payments which, if proven, would evade the bar.

Claimant’s motion for leave to amend her amended claim so as to show these additional payments, was denied by the district court, but on application for writ of supervisory control this court on December 4, 1939, ordered that a peremptory writ issue directing the district court “to set aside the order denying and to enter an order permitting the amendment as sought.” (State ex rel. Steinfort v. District Court, 109 Mont. 410, 97 Pac. (2d) 341, 345.)

No petition for rehearing was filed, but apparently claimant did nothing to give effect to this court’s decision until after the administratrix on April 23, 1940, had filed her final account and had it set for hearing. Claimant then on April 26, 1940, obtained a peremptory writ from this court pursuant to its decision of December 4, 1939, and on May 2, 1940, served the writ upon the trial judge. On the same day the latter made an order reading:

“Pursuant to the direction of the Supreme Court, the order made by this court on September 28th, 1939, denying the right of Mary Steinfort to file certain amendments to a claim she had presented to the above estate, is hereby reversed, and it is ordered that the said claimant be and she is hereby granted the right and authority to amend such claim by adding thereto and thereon, to be endorsed upon the two notes upon which her claim is based the following endorsements, to-wit:

March 26, 1925, received $160.00

March 23, 1926, received 135.00

Feb. 15, 1927, received for balance of interest up to

May 1, 1924 213.89

1931, received 100.00

1932 ' “ 100.00

1933 “ 100.00

1934 “ 100.00

1935 “ 50.00

1936 “ 50.00

May 28, 1937, received 50.00

“Done this 2nd day of May, 1940.

“(Signed) Albert Besancon “Judge of the District Court”

Subsequently on June 20, 1940, the district court ordered the administratrix to “at once allow or disallow said amended claim of the said Mary Steinfort,” and it is that order against which the application of the administratrix for a writ of supervisory control is now directed.

The sole issue is whether the administratrix can and should be compelled to act again upon the claim as finally amended, and in determining it we must consider the cognate questions of the claimant’s right and the administratrix’ power and duty.

The proper purpose of probate proceedings is to administer and settle decedents’ estates expeditiously and efficiently. It is not the accomplishment but the failure of these purposes which has in the past aroused most of the criticism of probate proceedings. The result has been the enactment by legislatures of probate codes and especially of statutes like sections 10171 and 10173, Eevised Codes, providing that creditors’ claims must be filed within four months after the first publication of notice to creditors in estates of this size, and absolutely.barring claims not so presented (with two exceptions not here in point); and section 10176, providing that in ease of the administrator’s failure or refusal to act upon a claim within ten days after its presentation, the claimant has the option to consider the non-action equivalent to a rejection on the tenth day; and section 10178, providing that a rejected claim is barred unless suit is brought within three months after the rejection and filing. As noted above, the original “amended claim” was presented, rejected and filed on August 4, 1939, two days before the time for presentation expired. Three months later, on November 4, 1939, expired the time for filing suit, which was claimant’s only recourse for the disallowance. (Sec. 10178, Rev. Codes; In re Bette’s Estate, 171 Cal. 583, 153 Pac. 949.)

The statutes are mandatory and unambiguous. The administratrix has no power to waive them or to estop herself from setting them up (Vanderpool v. Vanderpool. 48 Mont. 448, 138 Pac. 772), and the court has no power to waive them or to authorize the administratrix to do so. (State ex rel. Paramount Publix Corp. v. District Court, 90 Mont. 281, 1 Pac. (2d) 335, 76 A. L. R. 1371, 1377.) This applies not only to the allowance or payment of a claim barred by the non-claim statute or by the general statutes of limitation; it necessarily applies to any other method by which the benefit of the defenses might be lost to the estate, such as the settlement or compromise of an action not filed within the statutory period after rejection, or to a new rejection of a claim after the time has expired, for the purpose of starting the suit period running again. The courts have recognized the fact that these are matters for legislative determination and have not tried to usurp the legislative functions by overruling the statutes even in case of hardship; for every non-claim or limitation statute is a hardship upon those barred by it.

But without assuming to overrule statutes the courts will wherever possible construe them so as to prevent hardship. Thus if a claim has been rejected because insufficiently presented, it has been held that the claimant may again present it in proper form if he acts in time. An instance is the ease of Lindsay v. Hogan, 56 Mont. 583, 185 Pac. 1118, in which this court said, after quoting the special statute of limitation of actions on rejected claims (now sec. 10178): “When a claim has once been presented in proper form and rejected, the claimant may not be permitted thereafter to evade the statute by making another presentation founded upon the same transaction, differing from the former only in form and detail. (Titus v. Poole, 145 N. Y. 414, 40 N. E. 228.) But if a creditor attempts to present his claim for allowance, and for some reason it is not presented in proper form, no valid reason suggests itself why he may not present' it again in due form, provided he does so before the time has elapsed in which claims may be presented. (Westbay v. Gray, 116 Cal. 660, 48 Pac. 800.) It would seem that a second presentation is absolutely necessary in such case to enable the claimant, if it should be rejected, to maintain his action thereon; for unless the claim upon which he founds his action is in proper form, it will be excluded as incompetent when offered in evidence at the trial.” And even where the time for presentation of claims has expired the courts have seized upon statutes like section 9187, Revised Codes, authorizing the amendment of “any pleading or proceeding,” to permit the amendment of a claim which was filed in time, where the amendment merely indicates that the claim is not barred on its face (Wise v. Outtrim, 139 Iowa, 192, 117 N. W. 264, 130 Am. St. Rep. 301) or makes some other addition or alteration, provided the essential grounds of recovery are left substantially unchanged in nature, at least where the effect of the change is not to increase the amount of the claim. (State ex rel. Steinfort v. District Court, supra.) As the California court said in United States Gypsum Co. v. Shaffer, 7 Cal. (2d) 454, 60 Pac. (2d) 998, 999, with reference to the amendment of a claim which had been presented within the time allowed by statute: “The effect of the order permitting the amendment to be filed was not to extend the statutory period within which claims may be filed. ” It is well settled that where the requested amendment after time would amount in effect to the presentation of a new or substantially different claim after time the court has no power to set aside the statute by-permitting the amendment. (State ex rel. Paramount Publix Corp. v. District Court, supra.)

In other words, the presentation of an amended claim within time, under Lindsay v. Hogan, supra, is based upon the theory that no substantial presentation of the claim had theretofore been made and that the new presentation is therefore the first due presentation thereof. It naturally follows that the new claim should be passed upon by the administratrix and that her rejection and filing of it would for the first time entitle the claimant to sue and would thus start running the three-months statute for filing suit. (Sec. 10178, Rev. Codes.)

On- the other hand, all of the authorities indicate, and it is necessarily true, that unless the courts are to usurp legislative functions and overrule the non-claim and limitation statutes, the amendment after time of a claim filed within time is permissible only on the ground that the amendment does not amount to a new claim or to a new presentation of an old one, but is merely an improvement or perfection of a claim substantially presented in time but lacking certain elements necessary to express its full merits. To reach this result it is necessary to hold that the amendment relates back to the original presentation, and that is what has been done. (State ex rel. Steinfort v. District Court, supra.) Of course it is a fiction that the amendment is made as of the time of the original presentation, but since section 9187 permits amendments only, and no statute authorizes the presentation of an amended claim after the time limited by section 10171, it is necessary, in order to grant any relief under the amendment statute, to indulge the fiction that the amendment relates back to the time of the original presentation' — in other words, the fiction that the claim as actually presented included the amendment.

The due presentation of a claim is a condition precedent to suit. (Lindsay v. Hogan, supra; State ex rel. Paramount Publix Corp. v. District Court, supra.) This court said in the latter case: “A condition precedent to recovery on a claim presented to the administratrix, and by her rejected, is that it must be based on the claim as presented, and cannot give support to any other cause of action.”

The required presentation is necessarily that of the identical claim sued upon; as this court said in Brown v. Daly, 33 Mont. 523, 84 Pac. 883, 884: “Within three months after such rejection an action may be commenced to enforce such claim. * * * What claim? It goes without saying that it is the identical claim which was presented; otherwise the law would be a dead letter. ’ ’ Otherwise stated, the claim sued upon must be based upon the claim as presented. (Vanderpool v. Vanderpool, supra; Ullman Co. v. Adler, 59 Mont. 232, 196 Pac. 157.) The effect of the fiction is that the amended claim is the one which was presented within time. Without this fiction the amended claim cannot be proved upon suit as the identical claim presented and sued upon.

By statute the administratrix is forbidden to allow a claim not presented in time, and her rejection of it will not warrant suit. On the other hand, if it is presented in time, her rejection will warrant suit. Therefore we permit an amendment after time, to correct or complete without materially changing a claim timely filed, and indulge the fiction that the amendment existed when the claim was first filed. But we cannot do that and at the same time consider that the amendment did not exist later on the same day when the claim was denied. If it is deemed amended when presented it must be deemed amended when denied later on the same day. No further denial is therefore necessary. Nor is a further denial proper.

If this were a new claim offered within time in place of an insufficient one, as in Lindsay v. Hogan, supra, it would require a new action by the administratrix and her denial would start the three-months statute running. But if the further amendment here constituted a new claim, it could not have been filed at all and could justify no action by the administratrix; and since it does not constitute a new claim, but merely an amplification of a claim sufficiently presented within time to be properly before the administratrix, as it must have been to be justified at all, the amendment does not oust her prior action or make it inapplicable. Certainly if a sufficiently substantial presentation was made to warrant a later amendment, it was sufficiently substantial to warrant action by the administratrix. The original rejection and filing of it on August 4, 1939, was therefore sufficient to warrant suit by the claimant, and from that time the three-months statute began to run. Since it then began to run, the administratrix has no power to renew the period for suit by a new rejection of the claim, for she cannot waive or estop herself from relying upon these statutes, and she cannot do indirectly what she cannot do directly. Having no such power, she cannot be compelled by the court to exercise it.

Nor would the claimant be entitled to such action by the administratrix even had the latter the power to perform it. Obviously the purposes of the non-claim and limitation statutes from the viewpoint of the estate and those interested therein are to require claims to be presented promptly and properly for allowance or rejection and suits to be filed promptly upon rejected claims. Their purposes from the viewpoint of the claimant are to require the claim to be allowed promptly by the administratrix if it is found sufficient and proper, or, if not, to permit claimant upon suit to prove the presentation of the identical claim sued upon.

By reason of her excusable neglect or default, the claimant felt that she had not had the benefit of her rights in those respects and therefore sought and was granted the right to amend her claim in the hope that thus she might remove the administratrix’ objection, or that failing in that respect she could upon trial prove in court precisely the same particulars submitted to the administratrix. Her right after the amendment is not to have her claim rejected again, but merely to have it allowed if the amendment changes the administratrix’ mind, and if not, to be able to prove her amended claim in court as the claim presented.

Had respondent properly presented her claim in the first instance, its rejection and filing on July 29, 1939, would have given her until October 29, 1939, in which to sue; and since on August 4, 1939, she sufficiently presented her claim to warrant its amendment after time, its rejection and filing on the same day started the statute running and gave her until November 4, 1939, in which to sue. If she is now entitled to have her amended claim rejected again she will receive not merely that of which she has deprived herself by her excusable neglect, but additional rights not granted to the diligent. Even had respondent proceeded with diligence after the decision of this court on December 4, 1939, she would in that event have gained at least four months additional in which to sue; but by waiting as she did until May 2, 1940, before availing herself of the right granted her to amend, she would gain several months additional. If the new rejection were proper and had been made on June 20, 1940, the day of the district court’s order requiring it, claimant would have received until September 20, 1940, in which to sue, nearly a year after the time would admittedly have expired if she had presented the true and full facts on either the first or second attempt.

To grant her this additional time is not merely to restore the rights under the non-claim and limitation statutes which she lost by her neglect, but in addition to give her benefits not enjoyed by the diligent and to destroy the accompanying rights of prompt presentation and suit guaranteed to the estate and those interested therein. There can be no possible authority for so construing the remedial statute as to permit such results and to delay for an additional year the disposition of the claim and the settlement of the estate.

The purpose of remedial acts like section 9187 is not to reward neglect by conferring new or additional benefits upon bim who has been guilty of it, nor to grant benefits additional to those enjoyed by the diligent, but merely to save him from the penalty of his own negligence by restoring the ordinary rights he had thereby lost.

Manifestly, claimant could and should have filed, and presumably did file, her suit within the three months after August 4, 1939.

"What the claimant lost, therefore, was not the opportunity to sue upon the rejected claim, but merely the opportunity to have the claim allowed upon its entire alleged merits, or if it was necessary to proceed to trial, the opportunity to prove presentation of the exact claim sued upon. What she is entitled to receive by the amendment, therefore, is merely the right to have her claim allowed if the amendment removes the administratrix’ doubts, or if not, the right upon trial to prove the amended claim with the amendment ordered meantime.

It may be that the final amendment will satisfy the administratrix ; but it will not necessarily do so, since she has now seen three different amounts claimed, each with the sworn affidavit that all credits were shown, and at least two of them necessarily untrue. Unless the final amendment does so change her view of the claim which was presented in time and immediately denied and filed, as now to justify its allowance, certainly no further action by the administratrix is either required or justified. It follows that while she can now, if she chooses, approve the claim in the light of the amendment, she has neither the power nor the duty to reject it again so as to renew the running of the time for suit. And since by her neglect the claimant did not lose her opportunity to sue within the statutory period after the disallowance, and would by a new rejection receive, not relief from the consequences of her neglect, but a reward in the form of extra benefits, not enjoyed by the diligent, the courts have neither the power nor the authority to grant it under the remedial statute permitting amendments to relieve parties from the consequences of their own neglect.

The record does not show whether suit was filed within'time, but presumably it was, since neglect of one’s rights is not to be presumed. If not, claimant waived her right to file it and this court has not the power to suspend the statute of limitations, for such power is not granted it by the statute authorizing amendments. The amendment may remove the administratrix’ objection and cause her now to allow the claim. If not, and if suit has been filed within the statutory period, claimant may upon the trial prove the amended claim as the one timely pre sented and rejected. She will therefore have recovered every benefit she lost by her neglect in not presenting a claim showing the full facts before the time for presentation had expired. As for her further neglect, if any, in not suing within the statutory time after the denial of the claim, we have no power under section 9187 or any other statute we have been able to find to afford a remedy.

We have made diligent search but have been able to find no decision or other authority holding that the amendment of a claim after time either permits or requires a new rejection so as again to start running the statute of limitations for filing suit, and thus give the claimant more right than she would have had if reasonably diligent in her own interest.

The statement is made in State ex rel. Steinfort v. District Court, 109 Mont. 410, 97 Pac. (2d) 341, with reference to claims presented in time, rejected, and ordered amended after time, that the amendment makes the administratrix’ rejection functus officio, and thus requires her to pass upon the claim as amended, and that upon a rejection of the amended claim section 10178 governs as to time of commencing action. That statement, like the similar statement in Davis v. Superior Court, 35 Cal. App. 473, 170 Pac. 437, constitutes obiter dictum, as it relates to the effect of the amendment and not to the sole question then before the court, whether the amendment should be permitted. It could not have misled the claimant, for the decision was not made until one month after the statutory time for suit had expired after the rejection of her claim on August 4, 1939. All that part of the decision in State ex rel. Steinfort v. District Court, 109 Mont. 410, 97 Pac. (2d) 341, in conflict herewith is hereby overruled.

Even if a new denial were within the administratrix’ powers and duties, and within the claimant’s rights upon the ground that it would again start time for suit running, the order in question would seem to' be erroneous. If claimant is entitled to force the administratrix to reject the claim again, it is only because upon such new rejection she can sue and because without it she cannot. But if a new rejection permitted such suit it still would not be necessary, for in that event the claimant could avail herself of the right under section 10176, Revised Codes, to deem the claim rejected by reason of the administratrix’ non-action for ten days after the amendment finally became effective, which was on May 2, 1940. When, therefore, on June 20, 1940, she procured the order requiring the administratrix to deny the claim again if she did not wish to approve it, the claimant already had for the 48 days since May 12, 1940, the right to sue upon the claim if a new rejection could have had that effect. It hardly seems that if she neglected to avail herself of that right she could still further profit from her neglect by requiring another rejection, thus further extending the right of suit.

As we have seen, claimant’s failure to set forth the alleged payments prior to the denial of her claim on August 4, 1939, did not deprive her of her right to file suit within three months thereafter; it followed, therefore, that the further grant of time to sue was not her right under the remedial statute. But even if her original neglect had had that effect so as to entitle her to relief in the form of further time to sue, it was certainly not the cause of her additional neglect of her assumed rights under section 10176, supra. If she had the right to sue within three months after May 12, 1940, and sued, she is not entitled to another rejection further extending time to sue; and if she had that right and neglected to sue, that is further neglect for which we can give no remedy under the statute permitting amendments.

This is the first case in Montana, and apparently the first anywhere, in which has arisen the question of the extent of claimant’s right after such amendment. For that reason the principle of stare decisis does not apply. As stated above, this court’s dictum in State ex rel. Steinfort v. District Court, 109 Mont. 410, 97 Pac. (2d) 341, could not have misled claimant, because when it was promulgated the statutory time for suit after the rejection and filing of the claim had expired.

The similar dictum in the case of Davis v. Superior Court, 35 Cal. App. 473, 170 Pac. 437, together with the casual refer ence to it in the Montana case of State ex rel. Paramount Publix Corp. v. District Court, supra, should not have misled claimant. But if it did, there is no possible application of the rule of stare decisis, for in that event, as shown just prior to this and the preceding paragraph, claimant might have chosen to regard administratrix’ non-action for ten days after May 2, 1940, as a rejection; thus, in any event, she had no need and no right to procure on June 20, 1940, or at any other time after May 2, 1940, an order forcing the administratrix to deny the claim again.

The administratrix may not now be either required or permitted again to disallow the final amended claim so as again to start the statute of limitations running.

The writ will issue directing respondent court and judge to set aside the order requiring the administratrix “to at once allow or disallow said amended claim” of respondent, and to enter an order requiring her at her discretion at once either to allow the amended claim or to indicate her election to stand upon her original rejection of the .claim on August 4, 1939.

Associate Justices Morris and Arnold concur.