Majority
Headnote
1. Insane Persons—Permission to Sue—Effect.The plaintiff’s causes of action are based on this state of facts: The defendants George F. and Asa K. West were engaged in business as co-partners under the firm name of West Bros. “That, as such co-partners, they had conducted the business of shoe dealers, as well as to engage in the buying, in their firm and individual names, large amounts of real and personal property, and likewise to purchase interests, in syndicates.” In December, 1891, Asa was adjudged a lunatic by a probate court in Massachusetts, and the defendant Isaac S. West was appointed guardian of his person. In July, 1893, said Isaac was appointed a committee of the person and property of said lunatic by the Erie county court, in this state. The lunatic is or was the owner of the undivided one-half of divers parcels of real estate, and of a large amount of personal property, situate within this state and elsewhere, in the aggregate value of $250,000. The first count of the complaint alleges that between the 1st day of July, 1893, and January, 1895, the plaintiff performed professional services as a counselor at law, and also rendered other services, at the request of the defendants, for them and each of them, and for the said co-partnership, amounting in value to the sum of $10,000, and the defendants George F. West and the firm of West Bros., and the said Isaac S. West, as committee aforesaid, promised to pay the value thereof. The second count alleges that between the 1st day of July, 1893, and January, 1895, at the request of said defendants, for them and each of them, and for the said firm of West Bros., the plaintiff performed professional and other services upon, about, and concerning the real and personal estate above mentioned, and then sets forth an itemized account of part of such services, containing numerous items; that in the month of May, 1894, the plaintiff entered into an agreement with the defendants, and each of them, and they accepted and ratified the same, and agreed to pay him as therein specified, which agreement was partly oral and partly in writing. The written agreement set forth purports to have been made by and between the plaintiff and George F. West and West Bros., but it is not alleged that the committee ever signed or executed it. By this instrument, in consideration of the services theretofore performed and to be performed in all matters pertaining to the business of West Bros, and George F. West, for a period of one year from January 1, 1894, the latter agreed to convey to Kent all property, of every name and nature, over and above property amoxmting in value to $90,000,'—said sum to be in equities, shoe stock, or money, or both,—and over and above all debts existing January 1,1894, or thereafter necessarily incurred in the shoe busiixess with the consent of Kent. Kent was to have the management of all property, of every name and nature, outside of the shoe business, and was to be- consxxlted in regard to its management. “All matters per
Permission to sue is not a determination that the petitioner has a good cause of action against the committee. The court, in granting leave to sue, is not called upon to, and does not, pass upon the question of the committee’s liability. In all such cases the leave to bring suit reserves the right to the committee to set up any defense it may have, which may be done either by answer or demurrer. Fleischauer v. Dittenhoefer, 49 N. Y. Super. Ct. 311 ; Davis v. Duncan, 19 Fed.478.
The jurisdiction of the county court extends to the custody of the person and the care of the property, concurrently with the supreme court, of a resident of the county who is incompetent to manage his affairs, by reason of lunacy, etc. Code Civ. Proc. § 340, subd. 4. And, where that court first acquires jurisdiction, it is exclusive of that of the supreme court “with respect to any matter within its jurisdiction, for which provision is made in this title.” Id. § 2320. T'he court must preserve the property of the lunatic from waste or destruction, and out of the proceeds thereof must provide for the payment of his debts, etc. Id. § 2321. This jurisdiction and power must be exercised by means of a committee (Id. § 2322), who is subject to direction and control of the court by which he was appointed, with respect to the execution of his duties. But a committee of the property cannot alien, mortgage, or otherwise dispose of real property, except to lease it for a term not exceeding five years, without the special direction of the court, obtained upon proceedings taken for that purpose. Id. § 2339. A committee is an officer of the court, to do what the court cannot do,—to take charge of the lunatic’s
With this brief statement of the duties and powers of the. committee of a lunatic, the nature of the office itself, and the relations of the committee to the court appointing him, we will proceed to a more particular consideration of the case before us:
That the first count of the complaint is wholly insufficient to constitute a cause of action against the committee, founded upon a joint undertaking by the committee and the sane co-partner to pay the value of services rendered for them, and for each of them, and for the co-partnership, is too clear to require argument or discussion to establish the proposition. A verdict rendered for the plaintiff and against these defendants jointly, and the judgment entered thereupon, would result in imposing upon the lunatic’s estate an obligation to satisfy the whole amount of the judgment, and thus the estate would be charged with the payment of services rendered to a third party. This the court has no power to authorize or to sanction. The committee of an insane partner has no independent power or authority to join with the sane partner in incurring a joint legal liability, or in imposing upon the lunatic’s estate a legal obligation or charge, in matters connected with or concerning the transactions of the co-partnership business or property. Nor, of course, may he charge the estate for services rendered to “each of them.” The jurisdiction or power to determine the necessity or propriety of charges or expenses incurred in the preservation or protection of the lunatic’s interest or estate is of an equitáble character, and is to be based upon equitable principles; and the court having the care and custody of the estate is not authorized to abdicate its power, or surrender its function to the caprice of a jury. There would be gross impropriety in leaving it to that tribunal to determine the necessity of the charge, and to1 fix the amount. We do not see upon what principle a common-law action may be maintained against a committee to recover a judgment upon a debt incurred by him. Such an action must be founded upon a
How as to the second cause of action alleged in the complaint:
By order of the county court, the plaintiff is authorized to bring an action in equity in this court for the purpose of establishing and adjusting the claims and accounts mentioned in his petition, and to have determined the amount due thereon, if anything, -and also to compel the committee to file a true inventory and account. And now the plaintiff comes into a court of equity, and prays for a decree ratifying and confirming his dealings and transactions with the committee in re,spect of the management, control, and disposition of the property confided to the care and custody of the court, with knowledge that the acts of the committee were unauthorized, and in violation of the trust conferred or imposed upon him. If the court having charge of the property of the lunatic would be bound, upon established principles of equity and the adjudications, to refuse to sanction and give validity to the contract made with the committee, upon the petition of the claimant, the court in which the action is brought must be governed by the same rules, and act upon the same principles, and-deny the relief demanded. Ho advantage can be obtained by bringing a suit in equity in the supreme court, instead of proceeding in the usual and proper course, by petition. The court therefore is empowered to determine whether, upon equitable principles, the plaintiff is entitled to an equitable lien or charge against the estate of the lunatic on account of the professional and other services rendered upon his employment by the committee without any authority of law, and in reckless disregard of the solemn duty which he owed to the court that appointed him. It is true, the complaint alleges that the defendants have in their hands funds and property of West Bros., and of each of them individually, which are the fruit and result of, and obtained by, the plaintiff’s services, and retain possession thereof, and refuse to deliver the same to him in accordance with said contract. But the fact that the services were beneficial to the estate does not, per se, create any equitable right of compensation out of the property in custodia legis, or give rise to an equitable cause
Now, it is inconceivable that any court would authorize or sanction the making of this most unusual and extraordinary contract by the committee, upon which the second cause of action is founded. No argument is required to establish this. The inherent character of the contract condemns it. Nor, do we conceive, is the plaintiff entitled to any relief in this action, independent of the express contract alleged, in view of the nature and form of the complaint, and the facts and circumstances therein set forth. He is not entitled to receive, and does not deserve, much consideration, in view of his dealings with an executive officer of the court, who has undertaken to usurp its powers, and assume to exercise unwarranted authority. It seems that the committee was a nonresident, and it is inferable from the complaint that the management of the property and affairs 'of the lunatic was intrusted, to some extent, to the tender mercies of the sane partner and the plaintiff, who, it appears, acted in the capacity of agent and attorney for both parties, individually and collectively. This, of course, the committee had no authority to do. It is unnecessary to determine whether an adjudication of lunacy, of itself, terminates the partnership, or is only good cause for a decree of dissolution. See Story, Partn. § 295;, T. Pars. Partn. 464-466; 1 Lindl. Partn. 213; 2 Lindl. Partn. 577; 1 Bates, Partn. § 581; Davis v. Lane,,
“When he employs the assets of the beneficiary in trade or speculation, or in the establishment or continuance of a manufacturing business, as was-done in this case, he does it in violation of the trust by which he holds them. The guardian continued the manufacturing business of Locke for the purpose of affording a better income to his beneficiary and the fam'ly. It is also .alleged that it was necessary, to save and preserve the assets from sacrifice; in other words, it was necessary to commit a breach of trust in order to preserve the trust property. Equity cannot recognize the necessity of the situation, to confer such an extraordinary power. Something more than is stated in this petition is required, to make apparent the propriety of subjecting the assets to the hazard of a manufacturing business in order to save them from possible loss or depreciation. To approve and enforce against the trust estate a debt incurred by the trustee in open violation of the trust, merely because it has turned out to be beneficial to the estate, would practically dispense with the time-honored restraints and safeguards which equity has been so solicitous to maintain for the protection of trust estates. A relaxation of such restraints and guard's would invite every trustee to employ the trust funds about as he pleased, and make his lawful authority dependent upon the outcome of his enterprise.”
See, also, Cement Co. v. Jones, 8 Mo. App. 373 ; Woerner, Guardianship, §§ 57, 59, 142.
In view of the averment that in January, 1892, and for a long time prior and subsequent thereto, the lunatic resided in Syracuse, and the other circumstances stated, it is very doubtful that he resided in Erie county in July, 1893, when the committee was appointed; and, if he did not, the county court had no jurisdiction to make the appointment. Code Civ. Proc. § 310, subd. 4. But it will be presumed that the court lawfully acquired jurisdiction. Van Deusen v. Sweet, 51 N. Y. 378 . I suppose the county judge believed that the property of the lunatic in the county gave jurisdiction, but that is not true.
In conclusion, it should be remarked that there is no real necessity for the bringing of an action for the allowance of compensation for services rendered the committee, to be paid from the funds or property in the custody of the court, since there is an adequate remedy by summary application to the court. The proper course is to cause the committee, by citation or otherwise, to file an inventory and to render an account, etc. Brasher v. Van Cortlandt, 2 Johns. Ch. 212 ; In re Otis, 31 Hun, 512 ; Code Civ. Proc. § 2312. And since there may be some distinct items of the plaintiff’s account that may be meritorious, and entitled to the favorable consideration of the court upon an accounting of the committee, let the final judgment that may be entered upon the demurrer be without prejudice to an application to the county court for an allowance. The court having control of the final settlement of the committee’s accounts ought to have control of the expenditures.
It appears, therefore, that the remedy of the plaintiff is not such an action as this; and it follows that the interlocutory judgment in favor of the demurring defendant should be affirmed, with costs. All concur.
Cases cited
- Fleischauer v. Dittenhoefer 49 N. Y. Super. Ct. 311 p. 246
- People ex rel. Smith v. Commissioners of Taxes & Assessments 100 N. Y. 215 p. 247
- In re Otis 101 N. Y. 580 p. 247
- Pharis v. Gere 110 N. Y. 336 at 347, 18 p. 247
- Carter v. Beckwith 128 N. Y. 312 at 316, 28 p. 247
- Vilas v. Page 106 N. Y. 439 at 451, 13 p. 248
- In re Horton's Estate 18 Misc. Rep. 406 p. 249
- Merritt v. Merritt 27 App. Div. 208 p. 252
- Van Deusen v. Sweet 51 N. Y. 378 p. 253