Summary
In Union Chevrolet Co. v. Arrington, 162 Miss. 816, 138 So. 593 (1932) the Court considered whether statutes infringed on the constitutional role of the chancery courts to act as required in cases involving infants.
Summary of this case from Bryant v. BryantOpinion
No. 29668.
January 4, 1932.
1. INFANTS. It is chancery court's constitutional power and duty to act as superior guardian for infants.
It is not competent for Legislature to abate such powers and duties or for chancery court to omit or neglect them, but chancery court and chancellor must act with constant care and solicitude towards the preservation and protection of rights of infants.
2. INFANTS.
Court takes nothing as confessed against infants, makes for them every valuable election, rescues them from faithless guardians, designing strangers, and even from unnatural parents, and generally takes all necessary steps to protect their interests.
3. INFANTS.
Court cannot permit infants' rights to be prejudiced by waiver, omission, neglect, or design of guardian or other person.
4. GUARDIAN AND WARD.
Persons dealing with guardians or court respecting infants' rights are charged with knowledge of chancery court's guardianship over infants.
5. GUARDIAN AND WARD.
To make guardian's compromise settlement effective against wards, judicial sanction thereof must be on real, not perfunctory or merely formal, hearing (Code 1930, sections 1710, 1886).
6. GUARDIAN AND WARD. As respects compromise, chancellor cannot conduct hearing and enter decree where no witness in behalf of infants is heard, or is adverse to them ( Code 1930, sections 1710, 1886).
Code 1930, sections 1710, 1886, authorizing compromise and settlement of doubtful claims as applied to infants, contemplate and require that chancellor in action thereunder shall not proceed unless interests of infants are actually represented and protected at the hearing, and to hear only witness or witnesses adverse to minors would be equivalent to taking default against them, or in legal effect a refusal to hear witnesses in their behalf.
7. GUARDIAN AND WARD.
Regarding guardian's settlement, failure of attorney, purporting to represent minors and persons adverse to them, to see that all testimony in minors' behalf is presented, constitutes legal fraud.
8. GUARDIAN AND WARD.
Regarding guardian's settlement, when ancient and obvious principles regarding protection of minors' interests are disregarded, law looks to that disregard, not to intent, in determining existence of legal fraud.
9. DEATH. Chancellor properly refused to permit settlement for decedent's death made by guardian to be interposed in subsequent suit to infants' prejudice ( Code 1930, sections 1710, 1886).
It appeared that petition for settlement was presented to chancellor by attorney for defendant, whose driver's negligence caused decedent's death, that only witness produced was driver of defendant's truck, and chancellor's decree recited that chancellor having heard evidence found that outcome of cause against defendant by such minors was doubtful, whereas actual facts disclosed in subsequent suit made out liability against defendant beyond doubt.
10. DEATH.
Doctrine of indecent haste held inapplicable under circumstances to settlement made by decedent's widow in own behalf (Code 1930, sections 1710, 1886).
APPEAL from chancery court of Jones county. HON. A.B. AMIS, SR., Chancellor.
Jas. T. Welch, Ellis B. Cooper, and W.S. Welch, all of Laurel, for appellant.
Where a court order is obtained authorizing guardian to settle a claim the authority of the guardian to make the settlement and execute the release seems beyond question.
Sections 1874 and 1886, Code of 1930; Fox v. Fairchild, 133 Miss. 617, 98 So. 61; Gunter v. Henderson Molphus Co., 115 So. 720, 149 Miss. 603; Railway Company v. Blythe, 69 Miss. 939, 11 So. 111, 30 A.S.R. 599, 16 L.R.A. 251; Rowe v. Fair, 157 Miss. 326, 128 So. 87.
In most of the cases where this question of undue haste is discussed, the party claiming to have been wronged was suffering great physical pain at the time, or was under the influence of an opiate. No such question is involved in the case at bar.
Whittington v. H.T. Cottam Company, 130 So. 745.
Recent grief does not make one incapable of making a valid and binding contract. Undue haste may be an element to be considered, but in a case like this where no fraud is proven a solemn contract made with full opportunity for reflection and without any semblance of coercion and with authority of a decree of court having jurisdiction should not be set aside to give another judge an opportunity to determine what would be right when we have no absolutely accurate rule by which compensation can be measured.
Rowe v. Fair, 157 Miss. 326, 128 So. 87.
No principle of equity jurisprudence is more firmly established than that where fraud is relied on as a basis for relief sought from a chancery court the facts on which the charge of fraud is predicated must be specifically stated with full definiteness of detail. No general averment of a fraudulent course of business and no bare statement of a corrupt design on the part of the defendant is sufficient. The acts themselves which are claimed to be fraudulent must be clearly set out.
Weir v. Jones, 84 Miss. 606, 36 So. 533.
As to character of proof required in a case of fraud, see Simonton v. Bacon, 49 Miss. 582; Wherry v. Latimer, 103 Miss. 534, 60 So. 643.
To entitle a releasor to avoid a release on the ground of fraud, he must have been induced in making the release, to have acted to his damage upon the truth of a statement of a material fact known by its maker to be false or recklessly uttered regardless of its truth, made by the releasee or another in his behalf with the intention that it should be acted upon by the releasor in the execution of the release.
34 Cyc. 1060.
To constitute undue influence the will of the releasor must be so overborne that voluntary action on his part is prevented. Furthermore, the undue influence to invalidate the release must have been exercised to benefit the releasee or to wrong the releasor in the former's interest.
34 Cyc. 1965.
A party will not be permitted to make a trade and have it ratified by a court order, retain the fruits of the transaction, and then see if a better trader can be found to act for the party.
Gibson v. Western New York Railroad Company, 44 Am. St. Rep. 586.
A releasor is entitled to the consideration of the release only in the event that the release is valid, his retention and use of it as his own for an unreasonable length of time after the removal of his disability or the discovery of the invalidating facts is consistent only, except in rare cases, with an intention to ratify the release.
34 Cyc. 1066.
The law presumes that every man is sane and honest; that all his acts are dictated by correct motives, and are the result of his own independent, intelligent and unaided judgment. It also presumes that all his contracts are valid, and were entered into freely and voluntarily in the exercise of an intelligent discretion. It never presumes dishonesty, mental incapacity, fraud, undue influence, or any other matter tending to vitiate a contract; but always requires proof of facts from which dishonesty, mental incapacity, fraud, undue influence, or other matter may be reasonably inferred. And, whenever any person seeks to cancel or overturn a contract on the ground of fraud or undue influence, he must clearly establish by his testimony such fraudulent acts or the exercise of such undue influence as will vitiate the contract, or else a state of facts from which the reasonable and natural inference is that the contract was the result of such fraudulent acts or undue influence.
Wherry v. Latimer, 103 Miss. 534, 60 So. 643.
It now appears that the sum named was not commensurate with the injury suffered, but that in no way affects the present controversy. It is not to be forgotten, we say in conclusion, that the appellee rested in the settlement for nearly a year before bringing this suit. Hard as the appellee's case appears to be, we cannot open the door to unsettle the faith of men, dealing with each other, in the binding force of contracts solemnly entered into, by avoiding the effect of this release upon the wholly unsatisfactory evidence of fraud or misrepresentation found in appellee's testimony.
A. V.R.R. Co. v. Turnbull, 71 Miss. 1029, 16 So. 346; A. V.R.R. Co. v. Kropp, 129 Miss. 616, 92 So. 691.
Where a master pays a servant a certain sum in satisfaction of claim for personal injuries, the servant cannot attack the settlement as fraudulent without offering to return the sum paid.
Harrison v. Alabama Midland Railway Co., 40 So. 395; Kelly v. Louisville Nashville Railroad Company, 45 So. 906; Rabitte v. Alabama Great Southern Railroad Company, 47 So. 53.
The chancery court may empower guardian to compromise and settle minor ward's claim or right of action for damages at any time after grant of letters, and need not wait until after twelve months.
Gunter v. Henderson Molpus Co., 149 Miss. 603, 115 So. 720.
An executor or administrator may under a decree of the court or chancellor settle and release a claim for damages.
Rowe v. Fair, 128 So. 87, 157 Miss. 326.
Section 1886, Code of 1930 in itself is simply a statutory method of doing that which the guardian could do at common law without prior consent of the court.
Maclay v. Equitable Life Assur. Society, 152 U.S. 499, 38 L.Ed. 528.
It is the rule that to set aside a decree or judgment the court will not consider the fact that it may have been based on perjury unless the perjury goes to jurisdictional facts.
United States v. Throckmorton, 98 U.S. 61, 25 L.Ed. 93.
C.C. Evans and Collins Collins, all of Laurel, for appellee.
The law authorizing the settlement of claims by executors, administrators, and guardians, is found in sections 1710 and 1886 of the Code of 1930.
It was unusual for attorneys in a matter of so much importance to represent both the defendant and the complainant.
It was unusual for none of the parties to appear in court, or to be carried to the presence of the court. Judge Tann never saw this woman or any of her children. He only saw this man who had no more regard for human life than to drive as it is admitted he was driving on this occasion. A man guilty of manslaughter according to the testimony in the case.
The judge was the guardian of these children, but he did not hear these children's side of the affairs. They were forced to stand mute out of sight of the court.
If the release was void, no tender was necessary, but all that is necessary is that the jury, in case a verdict should be found for plaintiff, credit any amount they may find with the money paid plaintiff by defendant, and legal interest thereon.
Jones v. A. V.R.R. Co., 16 So. 379.
Mere ignorance, mere inadequacy of consideration, mere weakness of mind, mere mistake on the part of one party, will not entitle that party to release. But it is otherwise when there is a combination of such things to prejudice the party. In such case, in good faith and fair dealing, the adverse party ought to see and know, and must be presumed to know that the complaining party was not fit or in such mental condition as to bind himself by contract.
Jones v. A. V.R.R. Co., 16 So. 379.
It must not be overlooked that fraud arises by presumption from certain states of facts, when shown to exist, in cases: (1) Of confidential relations; (2) where a trustee deals with himself; (3) where the consideration is shockingly inadequate; (4) where a person of weak mind is apparently imposed upon; (5) in unjust voluntary conveyance as against creditors, and (6) others within like principles.
Griffith Chancery Practice, sec. 589.
It was not sufficient merely to present to the chancellor the petition which was actually presented in this case and produce before him only one witness, but was the duty of the attorney to acquaint the chancellor of all the facts and produce before him all the witnesses who knew anything about the matter touching the question of liability; the suffering of the deceased between the time of his injury and the time of his death; the solvency or insolvency of the Union Chevrolet Company; and, every other fact bearing on the fact as to whether or not the claim was doubtful, or one that was not readily collectible.
Appellee was incapable of attending to her own affairs and was a woman of weak mind, unlearned almost an imbecile and was imposed upon by two most astute business men in the settlement of this matter.
Argued orally by E.B. Cooper, for appellant, and by C.C. Evans and Jeff Collins, for appellee.
On the 3d day of October, 1929, a truck operated by an employee of appellant collided on a public highway with another truck on which Will Arrington was riding. As shown by the undisputed proof, the collision was the result of the negligence of appellant's said employee. Arrington was so seriously injured that in consequence thereof he died on the 7th day of October, 1929. Three days after Arrington's death the president of appellant company called at the farm occupied by the widow of the said deceased and stated to her that he would be glad to have her come, at a later and a convenient time in the near future, to the office of appellant company, there to discuss a settlement of the damages for the death of her husband.
On the 12th day of October, 1929, the widow, accompanied by her father, called at the office of appellant company, and as a result of their negotiations on this occasion, a settlement was agreed upon in the sum of one thousand two hundred fifty dollars plus medical, hospital, and funeral expenses. That afternoon the parties went to the office of appellant's attorneys, and there a formal release was executed by the widow for the sum of one hundred fifty-six dollars and twenty-five cents, that amount being her one-eighth part of said one thousand two hundred fifty dollars; and it was arranged that petitions for letters of guardianship for the several seven minor children of the deceased should be prepared by said attorneys as well as a petition to the chancellor for authority to settle for said children. On the 18th day of October, 1929, the widow again visited the office of appellant's attorneys, and she then signed and made affidavits to the petitions mentioned, and letters of guardianship were granted to her by the chancery court. On the 24th day of October, 1929, the petition of the guardian for the allowance of the settlement in behalf of said wards was presented to the chancellor in vacation, and a decree was signed by the chancellor on said date granting the petition and authorizing the settlement. Soon thereafter appellant paid to the guardian the sum of one hundred fifty-six dollars and twenty-five cents for each of said minors, for which appellant took the guardian's several receipts and releases.
About a year later the widow in her own behalf and as next friend for each of her said minor children filed her bill in the chancery court setting up a complete history of the facts, including all the facts respecting the injury and death of said Will Arrington and of the subsequent steps taken as a result thereof. Among other things, it was alleged that at the time the petition for the settlement of the claims of the minors was presented to the chancellor, the latter by reason of illness was not then capable of intelligent action upon said petition and that the rights of said minors were not protected in the alleged hearing of said petition and that in fact the said proceeding was a fraud upon said minors. We forego a further recital of the allegations of the bill, except to say that the averments are sufficient upon the point to which we shall now direct our attention.
The testimony discloses that the petition for the settlement was presented to the chancellor by one of the attorneys for appellant, and that the only witness produced, or who was then made available to the chancellor, was the driver of appellant's said truck, this driver being the person who was at fault in causing the injury and death. There is nothing in the present record which shows what statement the said witness made to the chancellor. The decree of the chancellor recites, however, that the chancellor having heard the evidence finds "that the outcome of the cause of action against the said Union Chevrolet Company by the said wards herein named is doubtful," from which the inference arises that the said witness must have testified untruthfully in exculpation of himself, else the chancellor could not have found the claim to be doubtful; for the actual facts of the case, as shown by the witnesses now before the court, make out liability against appellant beyond doubt.
There is thus brought into examination the meaning of, and the manner of administration under, the two sections of our statutes, sections 1710 and 1886, Code 1930, which authorize the compromise and settlement of doubtful claims. In recent years and since this court has held that these sections include claims for wrongful death, Fox v. Fairchild, 133 Miss. 617, 98 So. 61; Gunter v. Henderson Molphus Co., 149 Miss. 603, 115 So. 720; Rowe v. Fair, 157 Miss. 326, 128 So. 87, resort to said sections are of frequent occurrence, and their importance has now become such as to require a review of them by the court in connection with original principles in which they are imbedded.
Infants and persons of unsound mind are disabled under the law to act for themselves. Long ago it became the established rule for the court of chancery to act as the superior guardian for all persons under such disability. This inherent and traditional power and protective duty is made complete and irrefragable by the provisions of our present state constitution. It is not competent for the legislature to abate the said powers and duties or for the said court to omit or neglect them. It is the inescapable duty of the said court and of the chancellor to act with constant care and solicitude towards the preservation and protection of the rights of infants and persons non compos mentis. The court will take nothing as confessed against them; will make for them every valuable election; will rescue them from faithless guardians, designing strangers, and even from unnatural parents, and in general will and must take all necessary steps to conserve and protect the best interest of these wards of the court. The court will not and cannot permit the rights of an infant to be prejudiced by any waiver, or omission or neglect or design of a guardian, or of any other person, so far as within the power of the court to prevent or correct. Grif. Chan. Prac., secs. 45, 360, 530, 533. All persons who deal with guardians or with courts in respect to the rights of infants are charged with the knowledge of the above principles, and act to the contrary thereof at their peril.
The two sections of our statutes authorizing the settlement of claims are imbedded in those principles and are inseparable therefrom, both in meaning and in administration. To make a compromise settlement by a guardian effective against their wards in any case the judicial sanction thereof must be upon a real and not a perfunctory or merely formal hearing. Simmons v. Simmons, 85 W. Va. 25, 100 S.E. 743. For equal reason, the chancellor is not authorized to conduct a hearing and enter a decree wherein no witness in behalf of the wards is heard, or where the only witness is one who in the very nature of things is adverse to them. These sections contemplate and require that the chancellor in acting thereunder shall not proceed unless the interests of the infants are actually represented and protected at the hearing. To hear only the witness or witnesses who are adverse to the minors would be equivalent to taking a default against them — indeed, it would be equivalent in legal effect to a refusal to hear the witnesses in their behalf. And while it is permissible for an attorney to represent both sides in presenting such a petition, provided he fully advise the chancellor thereof, he must in so doing see to it that the testimony and the witness or witnesses who will give the full facts in behalf of the minors are presented and are heard, and if this is not done then there is a fundamental omission which amounts to legal fraud, however free from any thought of wrong the attorney may have been throughout. There was no thought of anything wrong in this case; but when in a matter of this kind ancient and obvious principles are disregarded, the law looks to that disregard and not to the intent. We, therefore, amplify the application of the principles to which the court gave adherence in Keanum v. Southern Ry. Co., 151 Miss. 784, 119 So. 301, and hold that the chancellor was correct in his refusal to permit the said settlement decree to be interposed to the prejudice of the wards in this case.
But the chancellor set aside the settlement and the releases not only as to the wards but also as to the widow, and this he did on the ground, as stated in his opinion, that there was indecent haste on the part of appellant in effecting the settlement. The courts of this state have taken an advanced position upon the subject of indecent haste in the settlement of claims for personal injuries, a position more in accord with enlightened sentiment and good conscience than was evidenced in some of the earlier cases; but so far as we are now advised the cases in which the courts have emphatically spoken, about indecent haste, have been those wherein unconscionable settlements have been made with the injured persons themselves, at a time when they were still suffering from their injuries. Our attention is not called to any case wherein that holding has been applied to settlements made with the adult distributees after the death. We are of opinion that the manifest weight of the evidence in this case is such that the doctrine is not applicable to the widow, and that the bill so far as her individual distributive share is concerned should have been dismissed. Therefore as to that one-eighth interest the decree will be reversed, but in all other respects it will be affirmed.
Affirmed in part, and in part reversed.