In re the Estate of Hodgman — 63 N.Y. St. Rep. 580

Majority

p. 580

In the Matter of the Estate of Frederick D. Hodgman, Deceased.

(Supreme Court, General Term, Third Department,

Filed December 4, 1894.)

Headnote

Judgment and decree—Vacation.

The right to set aside a surrogate’s decree under subd. 6, § 2481 ol the Code, is not affected by the fact that it has been affirmed on appeal, where the applicants were not parties to such appeal.

p. 581

Appeal from an order denying an application to open a decree.

Gharles 8.- Eooie, for app’lts; Edgar Hull (G. II. Siurgess, of counsel), for resp’t Wing; Young & Kelbgg, for resp’t Hodgman.

This is an appeal from an order entered in the surrogate’s court of Washington county, dismissing, the petition of Charles E. Hodgman and fourteen others, to open, vacate and set aside the decree entered in the above entitled proceedings, and to open the defaults of each of said petitioners in such proceedings, and to be permitted to file objections to the accounts therein. The decree that it is asked to open has already been before this court upon an appeal by Mary E. Hodgman, as executrix and as the widow and legatee of the decedent. 69 Hun, 484 ; 52 St. Rep. 727 ; Id., 140 N. Y. 421 ; 55 St. Rep. 800 : The court of appeals expressed its views very strongly as to the condition in which the accounts appeared, and as to the condition of the estate ; but, inasmuch as the matters therein referred to did not affect the then appellant, neither the general term nor the court of appeals felt it to be within their power to review the proceedings any further than they affected the interests of the appellant. The other legatees, heirs and next of kin not having appealed, and thereby having apparently consented to the settlement of accounts and the entry of the decree, the court was powerless to do anything more than to give a brief expression of its views of the matter as it then appeared.

The petition sets forth that the petitioners are next of kin, heirs and residuary legatees of and under the last will and testament of Frederick D. Hodgman. It is alleged, as to some of them, that they were not present at the accounting, and were not represented by counsel thereat, because some of them were advised that such representation was unnecessary, and • that the surrogate would protect their interests. As to others, they allege in their petition that they had been informed by one of the executors, or by the representative of one of the executors, that the estate was settled, and that the amount theretofore paid to each of them constituted all that was or would be due to them, and for that reason, in addition to supposing that their interests, if they had any, would be protected by the court, they had not appeared, and had no one to represent them; that, as to four of them, an. appearance was entered on their behalf, but that the person who made such appearance was not present at the latter ‘hearings in the proceedings, and was not present at the settlement, or alleged settlement, of the accounts. They further allege that no copy of the decree entered was ever served upon them. Several other petitioners, who, it is claimed on the accounting, had assigned all their interests in the estate, allege in their petition that they never knew until about two weeks before the filing of their petition herein that it was claimed at said accounting that they had assigned their interests in the estate, and assert that such instruments purporting to be assignments were procured from them by misrepresentation, and that they supposed that they were merely

p. 582

signing receipts for money actually received by them, and not signing assignments of all their rights and interests in the estate. Two of the petitioners assert that they could not read or write, and did not know what they were signing, except as it was represented to them. Various charges and allegations are made by different ones of the petitioners as to the manner in which their signatures were obtained to papers that it is now alleged by the executors of the estate were assignments of their respective interests therein. That as to one of the petitioners, who files a separate petition, she alleges that it is only within the last few weeks before the filing of the petition that she was informed of the contents of the decree, and that the same decree awarded a distribution of the said estate to the estate of Philander 0. Hitchcock, as executor, and away from the residuary legatees, heirs, and next of kin of Frederick D. Hodgman, and that she was only then informed that the attorney who represented her filed no objections to the accounts of the executors, or either of them. And she alleges that as to the paper purporting to be an -assignment executed by her, of all her interest in the estate, her signature thereto was obtained by misrepresentation, and that she supposed it to be merely a receipt for the account of money actually received by her, and not an assignment of all her interest in such estate. The petitioners accompany their petition with a list of objections that they propose to file against the accounts of the executors, in the event of their petition being granted.

The motion is made under subdivision 6 of § 2481 of the Code of Civil Procedure. That empowers a surrogate, in or out of court, “to open, vacate, modify or set aside, or to enter as of a former time, a decree or order of his court; or to grant a new trial, or a new hearing for fraud, newly discovered evidence, clerical error, or other sufficient cause. The powers conferred by this subdivision, must be exercised only in a like case and in the ■same manner, as a court of record, and of general jurisdiction exercises the same powers. Upon an appeal from a determination of the surrogate, made upon an application pursuant to this subdivision, the general term of the supreme court has the same power as the surrogate; and his determination must be reviewed, as if an original application was made to that term.” It will be seen by the petition that a number of the petitioners assert that they did not attend the proceedings upon the accounting for the reason that they were assured that their appearance was unnecessary, that the estate was settled, and that the amount they had already received was all that was due them; that, as to others, the attorneys who represented them did not attend upon the final hearings, and filed no objections to the executors’ accounts. They also assert that they did not know of the entry of the decree until a comparatively short time before the filing of their petition. It will be observed that the Code empowers the surrogate to open a decree “for fraud, newly discovered evidence, clerical error, or other sufficient cause.” Under settled rules of interpretation, the words, “or other sufficient cause,” must be interpreted to mean

p. 583

cause of like nature to these specifically mentioned. In re Tilden, 98 N. Y. 434 . Matters, then, in the nature of a fraud, although not actually, perhaps, constituting a fraud in law, or which would be the basis <sf an action for fraud, yet matters of that character • which have misled the petitioners, and by which they have been prejudiced, may be sufficient ground to authorize the surrogate, or this court in reviewing the action of the surrogate, to act under this section. The learned judge who wrote the opinion in the court of appeals in the matter of this estate, in determining that many of the objections raised to the decree did not affect the appellant, and therefore could not be passed upon in that appeal, used the following language ; “If I could see in the result the faintest trace of danger to her, I should be likely to advise a reversal of this decree, as manifestly wrong in many important respects. In that event we should seek to ascertain how an estate of about one hundred and twenty-eight thousand dollars, and which owed at its owner’s death, so far as I can see, not to exceed fifteen or twenty thousand dollars, has, after paying not more than eighty thousand dollars of legacies, become totally bankrupt, and indebted to one of the executors for about ten thousand dollars, where there are no assets to pay. We should inquire, also,'why Hitchcock, after being once credited with the Cobb trust fund of ten thousand dollars, as delivered by him to one or more of his associates, and which was paid to the legatees by Mrs. Yates, and for which her account is credited, is a second time credited with that sum, and permitted to swell his account to that extent against the estate. We should seek to know no what principle payments made to the residuary legatees were credited to the executors, when the result reached shows that no residue remained. And we should consider whether a confused mass of items, made up in total disregard of the rules for stating such accounts, should be allowed to serve as the basis for deliberate judicial action.”

A decree which calls for such vigorous language from the court of last resort should not, in my judgment, be permitted to stand, without further investigation, unless there is some decisive rule of the court to prevent it. This statement of the court of appeals, ■coupled with the allegations of the petitioners, it seems tome,sufficiently sets forth “sufficient cause,” in the nature of afrand, why the decree, as to these petitioners, should be opened and vacated, unless, as I have stated, there is some insuperable bar to such action. To establish such insuperable bar, we are referred0 by the respondent to the cases of Reed v. Reed, 52 N.Y. 651 , and Sheridan v. Andrews, 80 N. Y. 648 , and other cases of like nature, holding that, where a judgment or decree has been affirmed upon appeal, it is too late to apply to the surrogate’s court, or other court of ■original jurisdiction, to have such judgment or decree opened or vacated; 'that, by a judgment of affirmance upon appeal, the power to reopen or vacate such judgment or decree is taken from the surrogated court, or other court of original jurisdiction. It is the appeal, then, and the action of the appellate court upon it, that deprives the petitioners of the rights that they would otherwise have ; but it seems to me that the appeal from the original

p. 584

judgment can only bind those who are parties to it. Before the appeal was taken, they had the right to make this application, and the surrogate had power to grant it; and, in« my opinion, this right, like any other right, is one that a party cannot» be deprived o£ unless he has had his day in court. The petitioners did not have their day in court upon the appeal. It appears that the very questions that they now seek to raise by their petition, and by the proposed objections filed as part of the petition, could not be, and were net, passed upon by the general term and the court of appeals, for the simple reason that the heirs and residuary legatees were not parlies to the appeal; and it seems to me that the petitions have shown good and sufficient reasons why they were not parties to such appeal,—thatfis, they were not aware of the decree, and that some of them, at least, had not appeared in the surrogate's court because they were informed by the executors of the' estate, or those representing them, that there was no necessity for their appearing, and they were misled in believing that there was nothing due from the estate,—that is was practically settled.

The other objection that is raised, that the surrogate has not. power to set aside the legatees’ assignments, as fraudulent, is not to be passed upon here. The instruments are not before us, and we cannot determine whether, in truth, and fact, they are assignments, or only receipts for the payment of money. If receipts, they are always explainable by paroi. In addition to that, some of the petitioners, it appears, have not signed any such paper, whether the same be a receipt or an assignment.

It sufficiently appears, I think, from the proceedings already had in this court in the matter of this estate, that this decree ought not to stand. The question as to whether the petitioners, or any of them, have, by their own acts, placed themselves in such a position as will not entitle them to any portion of the residuary estate, can be determined upon a full hearing before the surrogate. If they possess rights which the surrogate has not power to adjudicate upon, after that fact is determined it will be time enough for them to resort elsewhere. A decree which stands under the condemnation of the court of last resort, and that has only been permitted to remain in force as a decree because no one who was injured by its errors made objection to it, now that such injured parties do appear, and ask to be heard, and give reasons why they have not heretofore made their objections, the court will not, under the circumstances, be curious to find reasons or causes to permit it to longer remain in force, and deprive the petitioners of the opportunity of asserting their claims. “The surrogate has the power of a court of general jurisdiction to vacate his decree (§ 2481, subd. 6), and relief may be granted, as in the supreme court, upon the application of any one, for sufficient reason, in furtherance of justice.” In re Flynn, 136 N. Y. 287 , 291; 49 St. Rep. 388 . And it seems to me that it is manifestly “in furtherance of justice” to open a decree that is open to the objections and criticisms made to-this one when it' • was examined by the court of appeals. The order appealed from is reversed, the decree opened and vacated,.

p. 585

and the petitioners permitted to file objections to the accounts, as-prayed for, with $10 costs, and printing and other disbursements of this appeal, to be paid for by the respondent.

All concur.

Cases cited

In re the Judicial Settlement of the Accounts of Executors of Hodgman 140 N. Y. 421 N.Y. 1893-12-19 p. 581
In re the Several Accountings of the Executors of Tilden 98 N. Y. 434 N.Y. 1885-03-10 p. 583
Reed v. Reed 52 N.Y. 651 N.Y. 1873-05-06 p. 583
Sheridan v. Andrews 80 N. Y. 648 N.Y. 1880-03-19 p. 583
In re Flynn 136 N. Y. 287 N.Y. 1892-12-20 at 291 p. 584