March Term, 1866
Albert Matthews, for the appellant.
William Watson, for the respondent.
The questions raised by the defense, at the trial, were numerous; but it will not be necessary or profitable to discuss more than one, and that relates to the defense of collusion between the plaintiff and Kerr.
The decree states on its face that it was obtained on the failure of Kerr to attend on the hearing; that it was taken without his appearance; and it follows, of course, that it was taken by default. Kerr was put upon the stand to sustain that defense. He was asked, what became of the fund, and, also, whether any part of it was stolen from him. By statute, an administrator is not chargeable with money or property belonging to the estate which has been lost without any fault on his part. (§ 56 of the article before referred to.)
It appears from the decree that Kerr was credited only with actual payments of money: also, that it was his own statement, under his own application for a settlement, which was adopted as the basis of the decree. If the money had been actually stolen from him, without fault on his part, it was a credit which, in justice to his sureties, Kerr should have demanded. The fact, if proven, tended to show that there had been a collusion or fraudulent recovery submitted to by Kerr. The same remark holds true of the inquiry to the same witness as to the share of the fund to which his wife, a daughter of the intestate, was entitled.
Fraud vitiates a judgment, as well as every contract tainted by it. The sureties had no right to a hearing, before the surrogate, on the question of the amount due from Kerr. None to test its validity upon an appeal. They were strangers to the proceeding. It is true that the decree is prima facie evidence of the amount due from Kerr; and its recovery, on his admission, arising from his default, binds the sureties in the absence of fraud or collusion.
This principle is fully sustained by English authorities, and also in our own courts. ( Douglass v. Howland, 24 Wend., 55-59.) In the case cited, the authorities are extensively reviewed by Judge COWEN.
The sureties, of whom Terry was one, were strangers to the proceeding in which the decree was pronounced, and are bound by the decree only because the condition of their bond makes them so. They agree that Kerr shall faithfully execute his duty, and obey the orders of the surrogate touching the administration. The decree proves a breach of the bond prima facie. The sureties are so far concluded, by its terms, that they cannot impeach it for error or irregularity by an appeal, on their own motion, nor collaterally. Judge COWEN says, in the case just referred to, that "it is plain, from the nature of the agreement (one where sureties stipulate to abide the event of a suit), that the surety means to be concluded, always saving the right, as the law must, in every case where a suit is between third persons, to contest the proceeding on the ground of fraudulent collusion, for the purpose of charging the surety." Numerous cases from the English reports, and from neighboring States, are collected and reviewed by the learned judge.
The defense was insufficiently pleaded, but that objection was not raised by the demurrer to the answer, and cannot be heard at the circuit, or afterward on appeal.
The evidence offered tended to establish the defense of fraud or collusion, and should have been admitted. The appellant should have submitted to the order for a new trial, and met the evidence offered on this subject, but having stipulated for judgment absolute in case the order appealed from should be affirmed, that must be the result, if the court concur in the views I have expressed.
The order appealed from should be affirmed, with costs, and judgment absolute entered for the defendant.
Concurring, DAVIES, Ch. J., WRIGHT, PORTER and MORGAN, JJ.; HUNT, PECKHAM and SMITH, JJ., not voting.