In Lathrop v. Bampton, 31 Cal. 17, it was said: "The identity of a trust fund consisting of money may be preserved so long as it may be followed and distinguished from all other funds, not by identifying the individual pieces or coins, but by showing a separate and independent fund or value, readily distinguishable from all other funds."Summary of this case from Elizalde v. Elizalde
[Syllabus Material] [Syllabus Material] [Syllabus Material] [Syllabus Material] [Syllabus Material] Rehearing Granted 31 Cal. 17 at 24.
Appeal from the District Court, Sixth Judicial District, Sacramento County.
In the year 1852 Humphrey Griffith was appointed guardian of the person and estate of Augusta Hunter Dean, by the Probate Court, of Yolo County. On the twelfth day of June, 1863, plaintiffs were appointed such guardians by the same Court.
H. H. Hartley, for Appellant, admitted that as between guardian and ward, when the guardian received money, and used it with his own, and kept no separate account, that the ward was entitled to claim any money on hand to the amount received by the guardian for the ward, and that if the money of the ward had been invested without authority in real or personal estate, the ward might claim such real or personal estate, or might treat the guardian as a debtor. He argued, however, that by the receipt of the ward's money no lien was acquired against the estate of the guardian or priority created over the other creditors of the guardian; and cited Hill on Liabilities, 759; and 2 Story's Equity Juris., Secs. 1,285-86. He also arguedthat although, as between guardian and ward, while the money of the ward or its proceeds remained in the hands of the guardian, the ward could claim the same absolutely, and had a special lien thereon, yet when there was no property which the ward could trace or earmark as the trust fund, and its identity was lost, that then the simple status of creditor and debtor existed as between guardian and ward and the representative of either; and cited Tiffany on Trusts and Trustees, 33, 34. He also argued that whenever a guardian or trustee died, the effects of the ward or cestui que trust, if they could be distinctly marked and traced, did not go into the hands of the executor or administrator as such, and were no part of the assets of the estate; and that the ward, his guardian, or cestui que trust, could claim the fund or property, and remove it from the assets of the estate; and that if the executor or administrator refused on demand to deliver up the trust fund, an action could be maintained against them personally; and cited Farnsworth v. Oliphant, 19 Barb. 34, 35.
Charles N. Fox, for Respondents, argued that as Griffith in his lifetime had wrongfully convertedthe trust fund, not only he but his property was liable therefor; and that as the claim could have been enforced against his property in his lifetime, it could still be enforced against the property of the testator in the hands of the executor; and cited Story's Eq. Juris., Secs. 533, 1,257-58, 1,285-86. He also argued that this was not a claim for damages for breach of trust, but a claim for the subject of the trust itself, and need not be presented to the executor for his allowance; and cited People v. Houghtaling , 7 Cal. 348; and Gunter v. Janes , 9 Cal. 643. He also argued that if the trustee so mingled the property of the cestui que trust with his own that it could not be identified, that the cestui que trust was entitled to the entire estate to the extent of the value of the trust fund; and cited Paley on Agency, 48, Story on Agency, 205; Hart v. Ten Eyck, 2 Johns. Ch. 108; Lupton v. White, 15 Ves. 432; and Docker v. Somers, 2 Mylne & K. 635. He also argued that a guardian could not by his own act become the simple debtor of the ward; and cited Seaman v. Duryea, 10 Barb. S.C. 523.
JUDGES: Sanderson, J.
By the Court, Sanderson, J., on rehearing:
After our former judgment was rendered, a petition for a rehearing was filed, in which the ground was taken for the first time that the complaint might be treated as a bill in equity for an account, and that in that aspect no presentation of the claim to the defendant before suit could be necessary, and hence that the judgment, instead of being reversed, should be so modified as to convert it into an ordinary judgment for so much money, to be paid in the due course of administration out of the assets in the hands of the defendant. Upon this point we deemed it proper that an argument should be had, and the case was accordingly opened for that purpose. Upon further consideration, we are satisfied, however, that there are no grounds upon which this can be treated as an action for an account. The complaint is not drawn upon any such theory, and no facts are stated which would entitle the plaintiffs to an action of that character. The defendant cannot be charged and held to account as a trustee, except upon the averment that he has come into the possession of the trust fund or its substitute. If at the time of his death the defendant's testator was in the possession of the trust fund, or other property into which he may have converted it, and such fund or other property had come into the possession of the defendant, he would have held it upon the same terms as his testator held it and the relation of trustee to the ward of the plaintiffs would have been added to that of executor by virtue of his successorship. Such fund or other property would have constituted no part of the testator's assets, and the defendant would not have held it in his capacity as executor but in his capacity as succeeding trustee to the plaintiffs' ward, and might have been compelled to account as such. But such is not the case. Neither the trust fund, nor any substitute for it which can be identified as such, has come into the hands of the defendant. On the contrary, the trust estate is gone, or, which amounts to the same thing, its identity is entirely lost, for it is not shown to be in the hands of the defendant in its primary condition, or that it was converted by the defendant's testator into the property or any part of it now in the defendant's possession as executor. Hence the defendant does not stand in the relation of trustee to the ward of the plaintiffs beyond the obligations imposed by his office as executor, and she has no remedy against him except such as belongs to a general creditor of the estate. (Trecothick v. Austin, 4 Mason, 29; Johnson v. Ames, 11 Pick. 181.)
We are of the opinion that there is nothing in the case which entitles it to be regarded as an action for an account, or exempts it from the operation of that provision of the Probate Act which requires all claims to be presented to the executor or administrator before an action is brought.
Judgment reversed and new trial ordered.