Asher P. Nichols, Administrator, etc., Appellant, v. George W. Tibet, Respondent

Asher P. Nichols, Administrator, etc., Appellant, v. George W. Tibet, Respondent. (Argued March 31,1874; decided April 7, 1874.) Aabon D. Patchin, died intestate, July 27,1864. Plaintiff was appointed administrator of his estate September 27, 1864. Mr. Patchin was “ a lunatic prior to the 1st day of June, 1862,” and Isabella Patchin, his wife, under a proceeding, de hmatico inquirendo, was duly appointed a committee of his person and estate, December 24, 1862. This action was brought on a bond executed by defendant, to her, as such committee, and assigned to Nichols, as administrator, and was as follows: “ For a good and valuable consideration to me in hand paid by Mrs. Isabella Patchin, as committee of the person and estate of Aaron D. Patchin, a lunatic, I do hereby covenant and agree, to and with the said Isabella Patchin, as such committee, that in case John Carter Brown shall discover in an action brought by him in the Supreme Court 'of the State of New York, in his own favor against Aaron D. Patchin, Isabella Patchin, his guardian, and as committee as aforesaid, and others, defendants, to enforce a judgment recovered by him, the said John Carter Brown, against the said Aaron D. Patchin, on the 5th day of December, 1861, for $10,887.02, any money or property, of the said Aaron D. Patchin, and shall recover final judgment in the said action that such moneys or property, be applied in satisfaction of the judgment mentioned in the said action, I, the said George W. Tifft, will satisfy such final judgment to the extent of the money, or property, so adjudged to be applicable to the payment of the said first mentioned judgment so recovered as aforesaid by the said John Carter Brown against the said Aaron D. Patchin. “ Witness my hand and seal, this 19th day of June, A. D. 1863. (Signed) GEO. W. TIFFT. [l. s.] ” 5 IT. S. Revenue > < stamp,5 cts. > John Carter Brown having this judgment of $10,887.02 (a deficiency judgment on a foreclosure), commenced his suit in the nature of a creditor’s bill, in said bond referred to, against Patchin, Tifft and others. April 27, 1863, Isabella Patchin, as such committee, was made a party defendant thereto. This action sought to appropriate to the payment of his judgment certain equitable assets belonging to Patchin, and also 1,416 shares of the capital stock of the Buffalo, New York and Erie Railroad Company, in Tifft’s hands. After the death of Mr. Patchin, and on June 22, 1865, this action was continued against Nichols, as administrator, the name of Mrs. Patchin, as committee, being struck out as a defendant. In September, 1859, Mr. Patchin was indebted to the Chautauqua County Bank, in the sum of $70,000, and as security for its payment, had assigned to the hank various securities, among others the said 1,416 shares of the stock of the Buffalo, New York and Erie Railroad Company, of the nominal value of $100 a share. In July, 1862, Samuel Barrett, and others (trustees to close up the affairs ’ of said bank, its charter having expired), sold said 1,416 shares of stock to said Tifft for. $4,000. By two instruments, bearing date respectively October 15 and October 16, 1862, A. D. Patchin, by his attorney in fact, Thaddeus D. Patchin, conveyed to Tifft his equity of redemption in certain personal property (locomotives, etc., etc., he had previoxisly conveyed to the Buffalo, New York and Erie Railroad Company, as a' security for indebtedness), and on the thirty-first of the same month, Tifft brought an action against the railroad company, A. D. Patchin, Mrs. Patchin and others, for an accounting and to redeem. May 29, 1863, nearly a month before the bond in suit was given, and while her husband was yet alive, Mrs. Patchin, as such committee, brought suit in the Superior Court of Buffalo, against Tifft, Barrett and others, trustees, to set aside the sale of said shares of stock, alleging it to be worth $140,000 and upward, as having been sold without notice, privately, and in fraud of the estate of her husband. Tifft answered, setting up the John Carter Brown suit as a defence. In this condition of things, Mrs. Patchin, as such committee, presented her petition to the Superior Court of Buffalo, setting forth the facts, and stating that Tifft and the trustees of the Chautauqua County Bank had made overtures for a settlement of all controversies, on certain conditions. These conditions were: 1st. Mrs. Patchin to discontinue her action to set aside sale of the stock to Tifft, etc. 2d. Mrs. Patchin to ratify sale of this stock, and other conveyances and transfers, to Tifft. 3d. Barrett and others, trustees of Chautauqua County Bank, to release and discharge Patchin’s estate from all claims, etc., they and the bank had theretofore made against it. 4th. Tifft to give the bond in the John Carter Brown case; and ' 5th. Tifft to pay Mrs. Patchin, as committee, $30,000. The court, by order, June 19,1863, authorized her to settle upon the terms and conditions proposed. She did so, and the bond in this suit was given by said Tifft to Mrs. Patchin, as such committee, in pursuance of such order, and as a part of such settlement. In the John Carter Brown suit, the complaint, as to Tifft, was dismissed April 30, 1869; but as against Nichols, as administrator, etc., Brown in that suit recovered a final judgment that by the commencement thereof he had a lien upon a certain eight second mortgage bonds of $1,000 each, and was entitled to have the proceeds of said bonds and the interest thereon, after deducting the costs and disbursement of the respective parties in the action, applied on his judgment. On the 25th of April, 1871, there was in the hands of the plaintiff (who had been appointed receiver in the action), as the proceeds of said bonds, $11,694.38, of which sum he retained and paid under the judgment, for commissions and allowances to Nichols, $1,190.31, and costs, etc., of other parties in the creditor’s suit of Brown, including costs of Tifft, $1,929.65, leaving $8,574.42, which was applied upon-the Brown judgment. The question here was as to the extent of defendant’s liability, he claiming that his liability was limited to the amount thus applied, while the plaintiff claimed that his liability extended to the whole sum discovered, i. e., $11,694.38. The court below held that the plaintiff was entitled to recover on the bond in suit only the $8,574.42 and interest, for which sum, with costs, judgment was entered. Held, that the purpose of the bond was evidently to replace to the Patchin estate what Brown should succeed in taking out of it by his action, which intent should be carried out if it could be done without violence to the language of the bond, construed in the light of the surrounding circumstances; that the whole fund was applicable to the payment of the Brown judgment, and the direction that the costs of the defendants in that action should he taken out of it instead of being paid by Brown individually, did not change the liability of Tifft, the defendant here, upon his bond. So, also, as to the amount taken from the fund for Brown’s costs; but held that, as to the amount paid to plaintiff out of the fund for his costs and allowances, as administrator, the estate was liable for them in any event; and as it had not been injured by applying a portion of the fund to that purpose, the defendant should not be required to pay them; and that, therefore, plaintiff was entitled to judgment for the avails of the bonds, less the costs and administrator’s fees paid to plaintiff. A. P. Nichols for the appellant. John Ganson for the respondent. [MAJORITY — Per Curiam] Per Curiam opinion for reversal and new trial. All concur. Judgment reversed.