In Re Parker v. Beal , 228 Mo. App. 400 ( 1934 )

OPINION. 1. The proceeding in the court below seems to have been inaugurated by defendant in error as trustee of the trust estate arising under the will of Albert G. Parker, deceased, within the jurisdiction of the court, for the purpose of compelling plaintiff in error, E.O. Beal, administrator cum testamentoannexo of the estate of Charles S. Davis, deceased, former trustee, to make settlement of the accounts of the said Charles S. Davis, deceased, former trustee, with defendant in error trustee, as his successor in the management of said trust, and to pay over to him as such trustee the amount found upon said settlement to be due said trust estate and for judgment therefor against the surety upon the bond of the said Charles S. Davis.

It was originated by the issuance of a citation to plaintiff in error as such administrator upon motion therefor filed by defendant in error as such trustee directing such settlement and payment and by notice to the surety upon the bond.

By an amended motion later filed, the court was further asked to ascertain and determine the amount of the trust estate coming into the hands of the deceased trustee Charles S. Davis and remaining unaccounted for at the time of his death for which he, under the terms of his bond, was liable and that the amount so ascertained be decreed to be due from the estate of the deceased trustee, as found, together with interest thereon from the date the same had been received by said deceased, and for judgment against plaintiff in error the National Surety Company, the surety upon the bond of the said Charles S. Davis, and that execution be issued therefor.

The court, upon the final hearing, found that said deceased trustee had, about the twenty-ninth day of June, 1929, received, as trust funds belonging to the trust estate, the sum of $3128.39 for which, by virtue of the provisions of his bond upon which plaintiff in error, the National Surety Company, was surety, he was liable to account at the time of his death to his successor as trustee, the defendant in error, in the full amount with interest at six per cent from the twenty-ninth day of June, 1929, amounting to $3408.55 and for the payment of which the said National Surety Company, as surety, was also liable in the event of default in the payment of the same by the said Charles S. Davis.

The court further found that the said Charles S. Davis at the time of his death did not have any of said funds on hand but had wasted and lost all of the same and directed that defendant in error, James L. Clark, as trustee, require of and recover from the plaintiffs in error, the said administrator and the said surety, the said sum of $3408.55 so found to be due and unaccounted for at the time of the death of said Davis with six per cent interest thereon from his death.

The plaintiff in error National Surety Company did not enter a general appearance in the court below but for the purpose only of protesting the jurisdiction of the court to proceed and render judgment against it. It may be further noted at this place that it does not appear from the record that Albert G. Parker, under whose will the trust arose, by said will or otherwise nominated a trustee to administer the trust estate. It also appears that the sum of $3128.39, with which the court charged the accounts of the deceased trustee, was a sum disclosed by the final settlement of the said Charles S. Davis, as executor of the estate of the said Albert G. Parker in the Probate Court of Adair County, as being the balance due the estate of said Albert G. Parker on final settlement. The only evidence upon which the court acted, so far as is disclosed by the record, in charging said sum to the said Charles S. Davis as trustee, was a receipt by the said Charles S. Davis as trustee to himself as executor, filed as a voucher with his settlement as executor in the probate court, which receipt appears to have been dated some forty-seven days prior to his appointment as trustee by the court.

2. The record and proceedings of the court below are challenged by plaintiff in error National Surety Company upon numerous grounds, chief among which are that the court had no jurisdiction to entertain such proceedings by reason of the fact that they were summary in character and unauthorized by any express law and that neither the said Charles S. Davis nor the said James L. Clark were ever legally appointed trustees of the trust estate and that the appointment of each was void for want of jurisdiction in the court to make such appointment.

The defendant in error has not favored us with a brief suggesting any specific theory by which such record or proceedings might be justified.

3. The power of a court of equity to appoint a trustee to administer and protect a trust estate arising under a will, within its jurisdiction, when needed, exists without a statute therefor. Such authority inheres in the court. [Brandon v. Carter, 119 Mo. 572.] Such an appointment, under the circumstances shown by the record in this case, does not require for its validity that it should have been made upon notice to the parties beneficially interested in the estate. It is valid without such notice. [Brandon v. Carter, supra; Rothenberger v. Garrett, 224 Mo. 191.] The case of Hitch v. Stonebraker, 125 Mo. 128, cited in its brief by plaintiff in error, National Surety Company, involved the removal of a trustee; and what is therein said about the necessity of notice must be read with reference to the facts of the particular case. The doctrine of the case of Brandon v. Carter, supra, is in no way discredited therein. Neither is the doctrine of such case discredited by the case of Rothenberger v. Garrett, supra; upon the other hand, such case is distinguished and expressly approved. It follows that the contention of plaintiffs in error against the validity of the appointment of defendant in error James L. Clark as his successor upon his death must be denied.

4. However, the further proceedings were not according to the course of the common law and constituted a form of trial disregarding the established course of proceedings and, being summary in character, were such as required an express statute for their exercise. This seems to be the accepted view. [60 C.J. 1014; Cohen v. Atkins, 73 Mo. 163, l.c. 166; Gunn v. Sinclair,52 Mo. 327, l.c. 332; Nolan v. Johns, 27 Mo. App. 502, l.c. 508; Keary v. Baker, 33 Mo. 603, l.c. 612.] When such proceedings are authorized, they are governed wholly by the provisions of the statutes authorizing them; and, in the prosecution of such, the provisions of such statutes, being in derogation of common right, must be strictly complied with. [Owens v. Andrew County Court,49 Mo. 372, l.c. 378; Judson v. Smith, 104 Mo. 61; 60 C.J. 1015.] There has been no statute called to our attention authorizing the proceedings in question so far as relates to trusts or trustees or the control of trust estates in the circuit court. At one time, there were summary proceedings authorized by statute of a somewhat similar character relating to settlements of guardians and curators in the probate court; but, such statute, having been repealed, the proceedings authorized thereby are held to be no longer available for the want of a statute to support them. [Cohen v. Atkins, supra, l.c. 166.] The proceedings followed herein by the court below, of which complaint is made, are expressly authorized by statute as applicable to probate courts and the settlements of administrators and executors therein who have been removed or who have resigned or died. [Revised Statutes 1929, secs. 49-50.] Such statutes authorize such proceedings in the probate court alone and furnish no authority whatever for their exercise by the circuit court in the matter of trustees or trust estates and their settlements.

The proceedings by the circuit court under review herein were unauthorized and beyond the jurisdiction of the court to entertain; they werecoram non judice; and the judgment rendered thereon was void.

5. The plaintiff in error E.O. Beal, administrator cumtestamento annexo of the estate of Charles S. Davis, former trustee, deceased, did not, upon qualifying as such, become the trustee of the trust estate under the will of Albert G. Parker as the successor of the said Davis. [State ex rel. Karrenbrock v. Trust Company, 209 Mo. 472.] Whatever the rule at common law may have been, there is no longer any such succession under our law. [State ex rel. v. Trust Co., supra; Woerner's American Law of Administration (2 Ed.), sec. 350.] He could have become trustee only by appointment from the circuit court. Not having become the successor of the said Davis as trustee by virtue of his appointment and qualification as administrator and not having been appointed such trustee by the circuit court, he could not administer the trust estate as trustee; nor could he, as representative of the estate of the deceased trustee; for the duty to administer the trust estate did not devolve upon the estate of the deceased trustee; and the administrator thereof was without authority to administer said trust in the name of such estate. As representative of the deceased trustee's estate, if any of the trust estate came into his hands, he could only hold and preserve it for delivery to the successor trustee in such trust and as he might be required to do in some appropriate proceeding provided by law. Having no such relation to the trust estate as to administer it and consequently no authority to make settlement as trustee or as representative of the estate of the deceased trustee, there existed, therefore, no power in the circuit court, although having jurisdiction of the trust estate, summarily to cite and require him to make settlement and, upon notice given to the surety upon the deceased trustee's bond of such citation, render judgment against the administrator or the deceased trustee's estate and the surety.

6. Further, the right of trial by jury still exists as it did at common law or by statute at the date of the adoption of the Constitution. No right of trial by jury at that date existed in summary proceedings unless so provided by the statute authorizing such proceedings. At least, the plaintiff in error, National Surety Company, was entitled to a trial by jury to determine its liability as surety upon the bond of the deceased trustee in the absence of a statute authorizing the summary proceedings employed herein by the court below. By the employment of such proceedings without the same being authorized by the statute, the court below denied to said surety its right to trial by jury, which was unauthorized.

7. Again, if the proceedings employed in the court below had been otherwise legal and unobjectionable, yet the court would not have been authorized to make the finding that there was due from Charles A. Davis, as trustee, the sum of $3408.55, for which the surety upon his bond as such trustee was liable, upon the sole evidence afforded by a receipt executed by Charles S. Davis as trustee to himself as executor of the estate of Albert G. Parker, deceased, found among the vouchers filed by him upon his settlement in the probate court as such executor. There must have been additional evidence that he, in fact, had such funds in hands as executor and transferred them from himself as executor to himself as trustee or that he replaced the same as trustee. He could not discharge himself as executor and relieve his sureties as executor and charge himself as trustee and his sureties as trustee with liability for such funds by a mere book entry or charge or acknowledgment by way of written receipt. A mere naked liability could not be so transferred. He must have had the funds on hands as executor, or he must have replaced them as trustee. Before his surety as trustee could be charged with liability, it must have been shown that he had received such funds as trustee. [State ex rel. Jacobs v. Elliott, 157 Mo. 609; State ex rel. Hospes v. Branch, 151 Mo. 622; State ex rel. Short v. Hardy,200 Mo. App. 405.]

8. The law affords to the defendant in error James L. Clark, trustee, adequate remedies for the recovery of the trust estate herein through proceedings of established course against the estate of the deceased Charles S. Davis and his sureties, either as executor or trustee, according to the capacity in which he was liable to account for such estate; but the proceedings employed herein are unauthorized and are not available, except as he may be liable to account as executor in the probate court. The judgment of the court rendered thereon, herein, is coram nonjudice and void. It is unnecessary to consider other assignments presented in the brief. For the errors noted, the judgment of the court below must be reversed and for naught held. It is accordingly so ordered. Campbell, C., not sitting. The foregoing opinion of REYNOLDS, C., is adopted as the opinion of the court. The judgment is reversed. All concur.