Opinion
June Term, 1899.
Edward W.S. Johnston, for the appellants.
Thomas C. Ennever, for the respondent.
The defendants were named as executors and trustees under the will of Peter A.H. Jackson, deceased, which provided that the estate was to be held and managed by them for the benefit of his children, and they were directed "to pay and discharge from time to time all taxes and assessments" on the property, "and keep the same insured and in good repair and condition, if damaged rebuilt, while held in trust by them." Their agreement with the plaintiff, dated August 14, 1896, the defendants signed and executed as "executors of and trustees," and were therein recited to be "executors of and trustees under the last will and testament of Peter A.H. Jackson."
On the opening of the trial, and again on this appeal, it was insisted that the complaint did not state, and neither did the proofs establish, sufficient to constitute a cause of action against the defendants as executors and trustees, or in their representative capacity, but only against them as individuals. In support of this contention, we are referred by the appellants to a long line of authorities in which it has been held "that a debt contracted by an executor or administrator as such, and for the benefit of the estate which he represents, only binds him individually, and does not bind the estate." ( Mulrein v. Smillie, 25 App. Div. 137.) The reason for the rule is well stated in Matter of Van Slooten v. Dodge ( 145 N.Y. 327): "An executor cannot subject the estate in his hands for administration to some new liability, either by his contract or by his wrongful act." Even this general rule is subject to exceptions where express authority is given by the will, which requires expenditures to be made in the course of administration to preserve the estate. ( Willis v. Sharp, 113 N.Y. 586.)
The distinction between administrators or executors, and trustees is important. Ordinarily, the only duties resting on an executor or administrator are to take possession, collect assets, pay debts and retain the estate for distribution — all of which the statute assumes can be done in eighteen months, except in special cases, when a longer period is required. They have nothing to do with the real estate. The duties of trustees usually are more extensive, more onerous, more responsible, and cover a longer period, and to them, where real estate is the subject of the trust, are committed its care, preservation and management. Their right and authority are, therefore, greater, and in considering the power of representatives of an estate to make contracts and charge the trust estate, the distinction between an executor and trustee must always be kept in mind. With respect to trustees, "the general rule undoubtedly is that a trustee cannot charge the trust estate by his executory contracts unless authorized to do so by the terms of the instrument creating the trust. Upon such contracts he is personally liable, and the remedy is against him personally. But there are exceptions to this general rule. When a trustee is authorized to make an expenditure * * * and the expenditure is necessary for the protection, reparation or safety of the trust estate, and he is not willing to make himself personally liable, he may by express agreement make the expenditure a charge upon the trust estate." ( New v. Nicoll, 73 N.Y. 130.)
This statement of the rule and the exceptions, with the cases supporting them, are fully discussed in Mulrein v. Smillie ( 25 App. Div. 135), which is an authority upon which the appellants confidently rely. It was therein held on demurrer that there could be no recovery against the estate unless the complaint alleged an agreement between the trustees and the plaintiff that the expense of the repairs should be a charge on the estate. The complaint here alleges that the defendants, as trustees, were authorized to, and as such did, make the contract, which is given in full and which expressly covenants to bind them as executors and trustees and their successors, and by its terms and conditions leaves no other reasonable inference than that the purpose and intent were to render themselves liable, in a representative character, and to charge the trust estate. This inference is emphasized by what appears throughout the time of performance, tending to show that the work was regarded as for the estate. Thus the receipts taken show payments from the estate.
The real point, therefore, is: Were the defendants authorized to make the contract? Undoubted power was given to them, under certain contingencies, to rebuild such building or buildings as would be in their opinion beneficial to the estate, and it was within their right to determine when the damage was such as to make it proper to exercise their power to rebuild. That the original buildings were old and out of repair, and that the defendants deemed it wise and beneficial to rebuild, was made to appear. Moreover, the answer did not deny such authority, though the amended answer may be said to have raised the question; but upon the stand Mr. Jackson, the trustee, stated that he understood he had a right to improve the property and build on it and to make the contract which he made. The power having been given to rebuild if necessary, and the trustees deeming the expenditure necessary for the protection and safety of the trust estate, and having by express agreement charged themselves in a representative capacity, they have made such expenditures a proper charge against the trust estate. ( Warren v. Union Bank of Rochester, 28 App. Div. 19.)
This contract provided that the materials necessary should be furnished and the work done in accordance with the specifications on or before November 1, 1896, in a good, workmanlike and substantial manner, to the satisfaction and under the direction of the architect, certified by his writing or certificate. Bearing directly on the question of performance, besides the testimony of the plaintiff that all the work was completed in a satisfactory manner, we have the certificate of the architect which it was stipulated should be given. The work also received the approval of the building department. A material defect shown was in the clogging of the pipes, but this was offset by the plaintiff's statement that the pipes were clear when he left the job. Allegations in the answer as to uncompleted work do not coincide with the specifications; thus "chain stays" and "stop-cock nozzles" do not appear in the specifications. The dispute, therefore, relates to conceded substitutions made, and the extent and amount of extra work, and by whom authorized.
Upon this question of authority we have testimony tending to show that each item was expressly ordered or suggested. The architect says he ordered some, and we have letters covering other items included in the charge for extra work. This testimony was contradicted by the defendants, and the question was submitted to the jury.
The appellants contend, however, that the receipt dated December twenty-eighth shows that it was accepted in full payment of all extra work done prior to that date, and they dispute alleged extra work done thereafter. This receipt was for the third payment in advance by request, and purports by its terms to be a receipt also for extra work to date. Just when the extra work in the schedule annexed to the complaint was done is not clearly shown, although some of the items are dated, and as the amount of $1,500 has been credited to payment of the $15,300 on the contract work, it was necessary for the purpose of an adjustment that all items should be taken into consideration and a balance obtained. So proceeding, it remains to inquire into the nature and amount of the claims for extra work.
The plaintiff testified that, in cases where extra charge was made, the figures were for the difference in price allowed for by the contract, and the articles furnished and work done. Thus with regard to "Fuller cocks," we have a letter from the firm from which they were purchased, stating that $154 was the difference in price. So, also, with regard to the closets, it was stated that the Climax closet was a patented article not known in the trade as "small washout closets," as named in the specifications, and the item is for the difference in price.
That there were substitutions of items for those in the specifications is evident. One-half instead of five-eighths inch pipe was furnished, and different iron riser pipes were put in, and changes were made in the bath tubs and sinks. The plaintiff testified that the necessity of making certain changes was called to the attention of the defendants, and that they assented to such changes and agreed to receive, and did receive therefor, an allowance where there was a difference in the cost or value. Both the architect and one of the defendants Jackson were present daily superintending the work, and they had the opportunity to object, had they seen fit, to any deviations or changes from the specifications. The conflict arising on these items was submitted to the jury, and the verdict shows that, as to some, they made deductions from the plaintiff's claims. It would exceed the limits of an opinion to discuss each item, its cost, whether authorized or whether included in the specifications. There was a sharp conflict on most of them, and just what ones were allowed and what ones rejected by the jury it is neither possible nor necessary to determine, and unless there were errors in the charge the verdict should not be disturbed.
An objection is taken to that part of the charge in which the court said that the jury might deduct the difference in value of any variations from the contract. What the judge undoubtedly had then in mind was the extra work and the matter of substitutions, for he charged with respect to work under the original contract that it should be "absolutely complete in every particular." Considering the charge as a whole, and taking into consideration the fact that the plea of substantial performance was supported both by the architect's certificate and by the fact that $15,300 on a $15,395 contract had been paid, the instruction which was given and which is now complained of was intended to guide the jury in their consideration of the dispute over extra work; and, so considered, it was not erroneous.
Another objection urged is to the refusal to charge that the plaintiff was not entitled to recover items (Fuller cocks instead of T handle cocks, pipes for hot water tank, Climax closets) for alleged extra work performed because such items were covered by the specifications. Whether such were intended by the specifications was not apparent, and upon each item there was, as already said, close and conflicting testimony. Thus the specifications speak of "Cocks" — not Fuller cocks; and it was testified that ordinary T handle cocks were intended, and that Fuller cocks were of greater cost. On the other hand, there was testimony that the Fuller cocks were no more expensive. A question of fact was thus presented for the jury, since Fuller cocks were not specifically mentioned in the specifications; they were ordered by special letter, and the firm from whom they were purchased said the cost would be greater. The same may be said with regard to the Climax closets. The specifications merely mention "small washout closets;" and it was testified to that the Climax closets were not known in the trade by that name, but were a patented article, and more expensive. Finally, as to the hot water pipes, it was testified that the location was changed from that set forth in the specifications, requiring additional pipe and labor.
It is contended further that it was error for the court to grant an extra allowance and costs against the defendants as executors and trustees, for the reason that the plaintiff recovered $100 less than the original claim, and failed to present proof of presentation of claim, or an offer to refer and refusal of the defendants. The provisions of the Code upon the subject of costs in actions against executors have no application to a case like the present, wherein the claim or right of action is one against the trustees, on a contract made by them after the death of their testator.
The judgment should be affirmed, with costs.
VAN BRUNT, P.J., RUMSEY, INGRAHAM and McLAUGHLIN, JJ., concurred.
Judgment affirmed, with costs.