The courts of the United States, as courts of equity, have
jurisdiction over executors and administrators where the parties to
the suit are citizens of different states, and this jurisdiction is
not barred by subsequent proceedings in insolvency in the probate
court of a state.
In such a case, the courts may interpose in favor of a foreign
creditor, to arrest the distribution of any surplus of the estate
of a decedent among the heirs.
Although at law a creditor cannot sue the surety upon an
administration bond until he has obtained a judgment against the
administrator, yet it is not so in equity, and in the present case,
where the original debtor and his surety are both dead, insolvent,
and a portion of the assets of the estate of the latter can be
traced to the possession of his administrator and his surety, the
power of a court of equity is required to call for a discovery of
the amount had nature of the assets in hand.
Page 64 U. S. 91
The bill was originally filed by Daniel Green, a citizen of the
State of Arkansas, against Fletcher Creighton and Jonathan McCaleb.
Whilst the proceedings were pending, McCaleb died, and a bill of
revivor was filed against Fletcher Creighton, his executor.
In 1836, Wheeler C. Green died in Mississippi intestate and
without issue. His personal representatives were Daniel Green,
Reuben Green, and Sally Smith. In 1837, the latter two conveyed
their interest in the estate to Daniel Green, who thus became the
sole claimant.
In October, 1836, letters of administration were granted to
Albert Tunstall, who gave as sureties upon his bond, Amos Whiting,
George W. Summers, and Eli West.
In 1837, Whiting died, and letters of administration upon his
estate were granted to his widow, Maria L. Whiting, and George
Lake. In 1839, Maria intermarried with J. M. Rhodes, who thereupon
became administrator of said Whiting in right of his wife.
In March, 1839, Green instituted proceedings against Tunstall,
as administrator, in the Probate Court of Claiborne County, and at
June Term, 1841, obtained a decree for $61,194.76, and it was
further ordered that the administration bond should be put in suit
in any court having cognizance of the matter.
So far, Green's remedy was against Tunstall personally and those
who represented Whiting, the surety upon his bond.
In October, 1841, Lake and Rhodes and wife were removed from the
administration by the probate court, and Fletcher Creighton was
appointed administrator
de bonis non of Whiting, who gave
bond in the penalty of $100,000, with Jonathan McCaleb as
surety.
Green had therefore to look to Tunstall personally, and
Creighton as the administrator of Whiting, and McCaleb as the
surety of Creighton. The bill alleged that a large amount of assets
of the estate of Whiting came into the hands of Creighton.
Page 64 U. S. 92
In August, 1843, Tunstall died insolvent, without having paid
any part of the money which he had been decreed to pay by the
probate court.
The bill stated that a large amount of the assets in the hands
of Creighton were at interest with McCaleb, his surety.
In 1844, Creighton, on citation for that purpose, made another
and further administration bond, with Jonathan McCaleb as his
surety, in the penalty of one hundred thousand dollars.
In 1848, Green filed his bill against Creighton and McCaleb. The
prayer of the bill was that the claim of the complainant against
the estate of Amos Whiting, as surety of Tunstall, who administered
on the estate of Wheeler C. Green, may be established by decree of
this Court, and against said Creighton, in his capacity as
administrator
de bonis non of said estate, to the amount
of the liability of said Amos, for and on account of said Albert
Tunstall, as administrator of W. C. Green. Also, that said
Creighton and Jonathan McCaleb may admit assets in the possession
of Creighton sufficient to pay the claim of complainant, or set
forth in his answer a full account of all the assets &c., of
the estate of said Amos Whiting, which have come to the hands or
knowledge of said Creighton, or of any other person within his
knowledge.
That said Creighton may be decreed to pay to complainant such
sums of money as may be decreed against the estate of Amos Whiting,
or against said Creighton in his character as administrator
de
bonis non, if sufficient assets shall be found in his hands
for that purpose, and if not, then for such amount as said
Creighton shall be found liable for; and in case said Creighton
shall not be able to pay such sum or sums on account of said
insolvency, then that said Jonathan McCaleb may be decreed, as his
surety, to pay it for him. The bill concludes with the general
prayer for relief.
The defendants demurred to this bill, but the demurrer was
overruled and they were required to answer. Answers were
accordingly put in which entered into the merits of the case, but
as the opinion of this Court did not touch upon that branch of the
subject, it is unnecessary to do so in this report.
Page 64 U. S. 93
One part of the answer must be inserted because it raises one of
the questions decided by this Court,
viz., the pendency of
the proceedings in insolvency.
Further answering, these defendants aver that the estate of the
said Amos Whiting was reported to be insolvent to the March term,
A.D. 1841, of the Probate Court of Claiborne County, and was then
so declared by said court, and commissioners appointed to receive
and audit claims against the said estate; and that, by reason of
various delays in relation thereto, the same still remains open for
the proof of claims; and these defendants insist that the
complainant is bound to make out his claim in the probate court in
the manner required by the laws of the state of Mississippi, and
has no right to maintain this suit to establish said claim against
the estate of Whiting; and they pray that they may be allowed to
rely on the same as a plea in bar to said bill; and they further
insist that, in any event, the complainants can only be entitled to
such a dividend upon his claim as the estate of said Whiting may
pay.
This cause having come on to be heard at the May term, 1855, of
said court, and the same having been argued and submitted, on the
nineteenth day of May, 1855, on final hearing on bill, bill of
revivor, answers to original bill and bill of revivor, exhibits,
and proofs, and the same having been taken under advisement by his
honor S. J. Gholson, the judge presiding on said final hearing, and
the court, being now sufficiently advised in the premises, doth see
fit to order, adjudge, and decree, and it is accordingly so
ordered, adjudged, and decreed, that said bill and bill of revivor
be and the same is hereby dismissed, and that the complainant pay
the costs to be taxed, ordered, adjudged, and decreed, on this, the
twenty-sixth day of January, 1856.
Page 64 U. S. 104
MR. JUSTICE CAMPBELL delivered the opinion of the Court.
The intestate of the plaintiff, as an heir of Wheeler Green,
deceased, and claiming, by assignment of the remaining heirs, the
entire estate, filed this bill against the defendant, in his
capacity of administrator of Amos Whiting, deceased, and of
executor of the will of Jonathan McCaleb. He states that Albert
Tunstall became the administrator of the estate of Wheeler Green by
the appointment of the Court of Probate of Claiborne County,
Mississippi, in 1836; that he gave bond for the faithful
performance of his duties, with Amos Whiting as his surety; that
Tunstall received a large amount of property belonging to the
estate, and committed a devastavit; that in the year 1841, his
intestate summoned Tunstall before the probate court to make an
account, and upon that accounting he was found to be indebted to
him, as heir, sixty-one thousand one hundred and ninety-four 76/100
dollars; which sum he was required to pay by the decree of the
court, and authority was given to prosecute a suit on the
administration bond. The bill avers that Tunstall and Whiting, his
surety, are both dead, and that all of his other sureties are
insolvent. It charges that the defendant, Creighton, as
administrator of Whiting, has assets in his hands for
administration, and that a portion of the assets is in the hands of
McCaleb, who is the surety of Creighton on his bond to the probate
court, as administrator of Whiting.
The object of the bill is to establish the claim of the
intestate and his representative, arising from the judgment
against
Page 64 U. S. 105
Tunstall and the breach of his administration bond, on which
Whiting is a surety, against the administrator of Whiting and his
surety, and to obtain satisfaction from them to the extent of the
assets in their hands belonging to that estate, and for this
purpose they seek a discovery of the assets, and account and
payment.
The defendants appeared to the bill, and allege that the estate
of Whiting has been regularly administered, and that returns have
been made to the Probate court of Claiborne County, Mississippi, of
whatever property came to the hands of the administrator,
Creighton, whose character as administrator is admitted, and that
he was then engaged in administering the estate under the laws of
Mississippi; that the estate had been reported to the probate court
as insolvent several years before this suit was instituted, and
that commissioners had been appointed by that court to receive and
credit the claims; which commission was still open for the proof of
claims. They contest the validity of the judgment recovered against
Tunstall, and the truth of the account preferred against them, and
deny the jurisdiction of the circuit court to entertain this bill.
The connection of McCaleb with the bond of Creighton is admitted,
and also that a portion of the money of the estate of Whiting had
been deposited with or lent to him. Upon the hearing of the cause
on the pleadings and proofs, the bill was dismissed for want of
jurisdiction, and by the agreement of the parties the record has
been made up so as to present that question only. None other will
therefore be considered. In the organization of the courts of the
United States, the remedies at common law and in equity have been
distinguished, and the jurisdiction in equity is confided to the
circuit courts, to be exercised uniformly through the United
States, and does not receive any modification from the legislation
of the states, or the practice of their courts having similar
powers.
Livingston v.
Story, 9 Pet. 632.
The Judiciary Act of 1789 conferred upon the circuit courts
authority
"to take cognizance, concurrent with the courts of the several
states, of all suits of a civil nature, at common law or in equity,
where the matter in dispute exceeds, exclusive
Page 64 U. S. 106
of costs, the sum or value of five hundred dollars, and . . .
the suit is between a citizen of the state where the suit is
brought, and a citizen of another state."
The questions presented for inquiry in this suit are whether the
subject of the suit is properly cognizable in a court of equity and
whether any other court has previously acquired exclusive control
of it. The court has jurisdiction of the parties. In the court of
chancery, executors and administrators are considered as trustees,
and that court exercises original jurisdiction over them in favor
of creditors, legatees, and heirs in reference to the proper
execution of their trust. A single creditor has been allowed to sue
for his demand in equity, and obtain a decree for payment out of
the personal estate without taking a general account of the
testator's debts.
Attorney General v. Cornthwaite, 2 Cox
43; Adams Eq. 257. And the existence of this jurisdiction has been
acknowledged in this Court and in several of the courts of chancery
in the states.
Hagan v.
Walker, 14 How. 29;
Pharis v. Leachman, 20
Ala. 663;
Spottswood v. Dandridge, 4 Munf. 289. The answer
of the defendant contains an assertion that, prior to the filing of
the bill, the estate of Whiting was reported to the Probate Court
of Claiborne County as insolvent, and thereupon that court had
appointed commissioners to audit the claims that might be presented
and proved, as preparatory to a final settlement, and that the
commission was still open for the exhibition of claims.
But of this statement there is no sufficient proof. Neither the
report nor any decretal order founded on it is contained in the
record, and the proceedings referring to one are of a date
subsequent to the filing of the bill.
The question arises, then, whether the fact of the pendency of
proceedings in insolvency in the probate court will oust the
jurisdiction of the circuit court of the United States. In
Suydam v.
Brodnax, 14 Pet. 67, a similar question was
presented. A plea in abatement was interposed in the circuit court
in Alabama, in an action at law against administrators, to the
effect that the decedent's estate had been reported as insolvent to
a court of probate, and that jurisdiction over the
Page 64 U. S. 107
persons interested and the estate had been taken in that court.
This Court declared that the eleventh section of the act to
establish the judicial courts of the United States carries out the
constitutional right of a citizen of one state to sue a citizen of
another state in the circuit court of the United States. "It was
certainly intended," say the court,
"to give to suitors having a right to sue in the circuit court
remedies coextensive with those rights. These remedies would not be
so, if any proceedings under an act of a state legislature to which
a plaintiff was not a party, exempting a person of such state from
suit, could be pleaded to abate a suit in the circuit court."
In
Williams v.
Benedict, 8 How. 107, this Court decided that a
judgment creditor in a court of the United States could not obtain
an execution and levy upon the property of an estate legally
reported as insolvent in the State of Mississippi to the probate
court, and which was in the course of administration in that court.
The court expressly reserve the question as to the right of a state
to compel foreign creditors, in all cases, to seek their remedies
against the estates of decedents in the state courts alone, to the
exclusion of the jurisdiction of the courts of the United
States.
The cases of
Peall v.
Phipps, 14 How. 368, and
Bank of
Tennessee v. Horn, 17 How. 157, are to the same
effect.
The case of the
Union Bank v.
Jolly, 18 How. 503, was that of a judgment creditor
who recovered a judgment against administrators, who subsequently
reported the estate of their decedent insolvent. After
administering the estate in the probate court, it was ascertained
that there was a surplus in their hands. The creditor had not made
himself a party to the settlement in the probate court; and the
administrators contended that his claim was barred.
This was a suit in Mississippi. This Court determined that the
creditor had a lien upon the assets thus situated.
Thus it will be seen that under the decisions of this Court, a
foreign creditor may establish his debt in the courts of the United
States against the representatives of a decedent notwithstanding
the local laws relative to the administration and
Page 64 U. S. 108
settlement of insolvent estates, and that the court will
interpose to arrest the distribution of any surplus among the
heirs. What measures the courts of the United States may take to
secure the equality of such creditors in the distribution of the
assets, as provided in the state laws if any independently of the
administration in the Probate courts, cannot be considered until a
case shall be presented to this Court.
The remaining question to be considered is whether the debt
described in the bill entitles a plaintiff to come into a court of
equity, under the circumstances. It is well settled that no one can
proceed against the sureties on an administration bond at law, who
has not recovered a judgment against the administrator. 5
How.Miss.R. 638; 6 Port. 393. But this rule is not founded upon the
supposition that there is no breach of the bond until a judgment is
actually obtained. The duty of the administrator arises to pay the
debts when their existence is discovered; and the bond is forfeited
when that duty is disregarded. The jurisdiction of a court of
equity to enforce the bond arises from its jurisdiction over
administrators, its disposition to prevent multiplicity of suits,
and its power to adapt its decrees to the substantial justice of
the case.
Moore v. Walter's Heirs, 1 Marsh. 488;
Moore
v. Armstrong, 9 Porter 697;
Carew v. Mowatt, 2 Ed.Ch.
57.
In this case, the original debtor, Tunstall, has died insolvent.
Whiting, his surety, has died insolvent. A portion of the assets
belonging to the estate of the latter is in the hands of the surety
of this administrator. A discovery of the amount and nature of the
assets in hand, and their application to the payment of the debt,
are required, if they are subject to the application.
We conclude that the circuit court was authorized to entertain
this suit, and that the decree dismissing the bill is
erroneous.
Decree reversed.
