Raines v. Shipley

1. As between the devisee of property on which there is a mortgage lien, and a devisee of other property, both devises being specific, the mortgage debt should be borne by the former.

2. If the executors have sold property included in a specific devise, and from the proceeds of the sale have discharged a mortgage which had *Page 449 been placed by the testator on other property also embraced in a specific devise, the devisee of the former may by a suit in equity seek a decree subrogating her to the rights of the original mortgagees to the extent necessary to protect her own rights.

3. In such a suit it is proper to join the executors and all interested legatees and devisees, and hence a prayer that the executors be enjoined from applying for their discharge is a proper one.

4. Although the complainant was a mere remainderman in a specific devise of realty, the prayer for an accounting was not inappropriate to the relief sought, since she exhibited returns of the executors showing that the testator had certain funds out of which assets were realized, and she challenged the correctness of certain items of expenditures appearing in said returns.

5. There being in the complainant's petition a prayer for general relief, and the nature of the case being such as under said prayer the right of subrogation, above referred to, is consistent not only with the case made by the petition, but also with one or more of the special prayers therein, she is entitled to such right under the prayer for general relief.

No. 14760. FEBRUARY 8, 1944. REHEARING DENIED MARCH 9, 1944. Nancy Griggs Shipley (nee Nancy Stewart Griggs) filed in the superior court of Terrell County her petition, which as amended contains the following allegations: The defendants, Augusta Griggs Raines, Theodosia Hollingsworth Duskin, Jack Duskin, and Edgar Hollingsworth, are residents of Carroll County, Georgia. The plaintiff and all of the defendants, except Jack Duskin, are heirs at law of Mrs. Theodosia Stewart Griggs. Mrs. Theodosia Stewart Griggs died testate, and her will has been duly probated and the executors have qualified. Augusta Griggs Raines, Theodosia H. Duskin, E. W. Hollingsworth, and the plaintiff operated farms for the years 1941 and 1942 under a written contract, as per exhibit B, during which years large profits were earned, from which $10,078.90 was paid towards the retirement of indebtedness owing by Mrs. Theodosia Stewart Griggs in accordance with said written contract. The remainder of the profits was divided among Augusta Griggs Raines, Theodosia H. Duskin, and E. W. Hollingsworth, to the exclusion of petitioner contrary to said agreement. According to the return filed by the executors, the estate is now free of debt. The executors have assented to the legacies in writing. They have made application for a discharge, which is assigned for hearing. According to the return, the estate bequeathed to petitioner by Mrs. Theodosia Stewart Griggs has *Page 450 been impaired and encroached upon by the executors for their personal and individual benefit. The executors paid $6645.74, which was a lien on a specially devised property, to Theodosia H. Duskin and Augusta Griggs Raines, said sum being derived from the sale of property in which a remainder of one-third interest was specifically devised to the plaintiff. The executors have paid to themselves and to attorneys fees not allowed by law, and have paid insurance on property owned by them and for which the estate received no income or benefit; have also paid taxes on property from which the estate received no income or benefit, and which was not chargeable against the estate; and have failed to account for an automobile and other property belonging to the estate. Under the will of Mrs. Theodosia Stewart Griggs, the plaintiff has and had a remainder interest in a one-third interest in certain farm lands, the remainder interest being burdened with a life-estate in favor of the defendant, Edgar Hollingsworth, which is charged with the cost of maintenance, support, and education of the plaintiff. The executors sold approximately $11,300 of timber off the land in which petitioner owns a one-third remainder interest, and sold a tract of land in which petitioner owns a one-third remainder interest, paid off a mortgage on the property, and applied the remainder of the purchase-price of $6645.74 on a mortgage on the property known as the Stewart building in Dawson, Georgia, devised under the will of Mrs. Theodosia Stewart Griggs to Augusta Raines and Theodosia Hollingsworth Duskin. The mortgage was placed thereon by Mrs. Theodosia Stewart Griggs before her death. Her will provided that the Stewart Place in Randolph County, Georgia, be not divided until the liens and indebtedness thereon were paid. The plaintiff alleged on information and belief that in addition to the commissions sought to be collected by the executors, all or some of the executors had already been paid large sums; and alleged that the report filed with the ordinary was too general and did not set forth facts sufficient to determine whether said estate had been properly managed and accounted for. The plaintiff contends that she is entitled to an accounting for her portion of the $6645.74 paid on the mortgage on the Stewart building, and for the timber sold; that she is entitled to a full and complete accounting from the executors as to the handling and management of the estate of Mrs. Theodosia Stewart Griggs, and *Page 451 to an accounting from the defendants, Theodosia Hollingsworth Duskin and Edgar Hollingsworth, for the profits earned by reason of the operation of the business for the years 1941 and 1942 under the contract attached as exhibit B.

Attached to and made a part of the petition was the will of Mrs. Theodosia Stewart Griggs, which is as follows: "Item 1. It is my will and desire that my body be buried in a Christian like manner. Item 2. That all my just debts be paid as soon as practicable after my death. Item 3. I will, bequeath, and devise my home located on Church Street, in Dawson, Terrell County, Georgia, with the furnishings as it now stands, to my grand-daughter, Theodosia Hollingsworth Duskin, daughter of Vernal Griggs and Edgar Hollingsworth. Item 4. I will, bequeath, and devise to Edgar Hollingsworth the home located on Seventh Avenue, in Dawson, Terrell County, Georgia, in which he now lives with his second wife, Gladys Griggs Hollingsworth, for his lifetime, with the remainder to my grand-daughter, Nancy Stewart Griggs, the only daughter of my beloved son, Daniel Stewart Griggs and Gladys Griggs Hollingsworth. Item 5. I will, bequeath, and devise all of my personal effects to my daughter, Augusta Griggs Raines, and my grand-daughter, Theodosia Hollingsworth Duskin. Item 6. I will, bequeath, and devise all of my farm lands located in Terrell and Randolph Counties, State of Georgia, and all personal property located thereon, including cattle, stock, farm implements and tools, except as hereinafter provided, into three equal parts; one-third to my daughter, Augusta Griggs Raines; one-third to Theodosia Hollingsworth Duskin and her bodily heirs; one-third to Edgar Hollingsworth for his lifetime, but charged with the maintenance, support, and education of his step-daughter, Nancy Stewart Griggs, during his lifetime, with the remainder to Nancy Stewart Griggs, my grand-daughter. I specifically bequeath and devise the Old Home Place or residence, where I was born, together with all the appurtenances thereon, located on the Old Stewart Place in Randolph County, Georgia, to Augusta Griggs Raines and Theodosia Hollingsworth Duskin, the same to be charged to their one-third pro rata share in the division of my farm lands. I will and bequeath that the Stewart Place in Randolph County, Georgia, containing three thousand (3000) acres of land, more or less, not be divided until the lien or indebtedness *Page 452 which is now on this land be paid off in full and satisfied. Item 7. I will, bequeath, and devise the Stewart building on the south side of Main Street, and at the intersection of Main and Lee Streets, in Dawson, Terrell County, Georgia, to my daughter. Augusta Griggs Raines, and Theodosia Hollingsworth Duskin jointly. Item 8. I will, bequeath, and devise one (1) brick building, located on the north side of Lee Street, in Dawson, Terrell County, Georgia, a part of the lower floor of said building now occupied by E. J. Pace, and the upper floor of which is now occupied by Dr. Steve P. Kenyon, to Edgar Hollingsworth, for and during his lifetime, with remainder to Nancy Stewart Griggs, my grand-daughter. Item 9. I will and desire that if any of my legatees die without leaving bodily heirs, their property revert to my estate, and be equally divided between the other legatees named in this my will, or their representatives. Item 10. I will, bequeath, and devise my bank stock in the First National Bank of Shellman, Georgia, to my daughter, Augusta Griggs Raines. Item 11. I will, bequeath and devise my Sales-Davis stock to my daughter, Augusta Griggs Raines. Item 12. I will and direct that five hundred ($500) dollars be put in a trust fund to take care of my lot in Cedar Hill Cemetery, in Dawson, Georgia, and the lot my father owned at Bethel Cemetery, in Randolph County, Georgia. I hereby nominate and appoint as executors of this my will, Edgar Hollingsworth and Augusta Griggs Raines, and Jack Duskin. In testimony whereof, I have hereunto set my hand, on this 1st day of May, 1937." Duly signed and witnessed.

Also attached to the petition was a copy of a writing, called a power of attorney, signed by Gussie G. Raines, Theodosia H. Duskin, E. W. Hollingsworth, and Nancy Griggs Shipley. It recited that Mrs. Griggs left a will which did not give the executors power to operate the properties; that the testator left debts which could not be paid at that time without a sale, and that it would be for the best interests of the legatees that the estate be operated for the purpose of paying the indebtedness thereon. The parties thereto constituted E. W. Hollingsworth, Gussie G. Raines, and J. W. Duskin their attorneys in fact with power to operate the properties; authorized them to make contracts with that end in view; invested them with large powers to rent out, sell, exchange, or encumber any of the farm products, to employ farm superintendents, *Page 453 to borrow money, and to secure the same by mortgage, bill of sale, or security deed, to use any and all funds on hand at the death of the testator, or received since that time, to pay for the operating expenses; and required them to make annual reports of the income and expenditures, said reports to disclose what amounts had been expended for operations and what had been paid on the indebtedness of the testator. This power of attorney was duly attested.

There was also attached to the petition as an exhibit the final returns of the executors, showing total receipts of $26,696.43, with disbursements in like manner. Among the items of receipts were the following: from sale of equity in Terrell County farm land, $8525; from sale of timber, June, 1942, Randolph County land, $7000; from sale of timber, September, 1942, Randolph County land, $4300. Among the disbursements were: executors' commissions, $2407.08; attorneys' fees, $1500.

The defendants demurred generally and specially to the original petition, — generally on the following grounds: that the petition set forth no legal or equitable cause of action; that it showed on its face that it was prematurely filed, the plaintiff's interest being that of a remainderman, and the life-estate not having terminated; and that there was a misjoinder of parties defendant, no sufficient facts being set forth to show that Theodosia Hollingsworth Duskin was a necessary or proper party. After an amendment of the petition as above set forth, wherein it was alleged that the executors sold a tract of land in which the plaintiff owned a one-third remainder interest, and paid off a mortgage on the property and applied the remainder of the purchase price of $6645.74 on a mortgage on the property known as the Stewart building in Dawson, devised under the will to Augusta Raines and Theodosia Hollingsworth Duskin, the defendants renewed their general demurrer to paragraph 7 of the petition, on the ground that said paragraph as amended did not set forth or otherwise refer to any property sold in which the plaintiff had a life interest; and further demurred to said paragraph as amended on the ground that the same set forth a conclusion of the pleader, without setting forth facts upon which such conclusion was based; that it was too vague, uncertain, and indefinite, in that it failed to set forth what commissions had been unlawfully paid to the executors, or how much, *Page 454 what attorneys' fees, and how much, had been unlawfully paid by the executors; what insurance and taxes had been paid which were not chargeable to the estate, or any other fact sufficient to enable defendants to prepare their defense. The demurrer to the original petition and to the petition as amended was overruled, and the executors excepted. The parties will be referred to as they appeared in the trial court. The plaintiff's case is built around the allegation that the executors have sold certain property in which she was given a remainder interest, and with the proceeds have paid off a mortgage placed by the testatrix on certain other property which was devised to others. She denies their right so to do. With this as the gist of her complaint, she makes other charges against the executors as to the correctness of their returns to the court of ordinary, seeks to prevent them from proceeding with their application for discharge, asks for an accounting against them, and prays for a judgment, and for general relief.

The will of Mrs. Griggs contains no residuary clause. All the devises are specific. The will gave no direction as to the sale of any property. It directed the executors to pay her debts. It made no mention of the mortgage referred to in the petition, and was silent as to whether the devisees were to take that particular parcel cum onere, or whether the executors should from other property free it from the mortgage lien. The three executors and all of the legatees and devisees other than the plaintiff were made defendants in the present action.

There is an allegation in the petition that "on the _________ day of ________, 1943," the executors assented in writing to the legacies. Construing the petition most strongly against the pleader, we will not treat this as a statement that the sale by the executors of the land and timber in which the plaintiff had a remainder interest took place after this assent was given, since no date of sale is alleged. This case will be decided unaffected by the allegation as to assent of the executors. We will also assume, in the absence of anything in the petition to negative it, that the sale by the executors was regularly had after an order granted by the court of ordinary. No one questions the right and duty of the executors to pay the debts of the testatrix, nor that all of the property left by *Page 455 her is liable for the payment of debts. The Code, § 113-1509, declares: "All the estate real and personal, unless otherwise provided by this Code, shall be liable for the payment of debts. If there is a will, the property charged with the debts shall be first applied; next the residuum, or, if there is no residuary clause, the undevised estate; next, general legacies may abate pro rata; and lastly, specific legacies shall contribute." And § 113-821, reads as follows: "Unless otherwise directed, the debts of a testator should be paid out of the residuum. If it proves to be insufficient, then general legacies shall abate pro rata to make up the deficiency. If they are insufficient, then specific legacies shall abate in the same manner. If the executor has assented to the legacies, and the legatees are in possession, after exhausting the assets in the hands of the executor, the creditor may proceed against each legatee for his pro rata share. For the payment of debts realty and personality shall be alike liable."

The rights of creditors are not here involved. The plaintiff does not seek to set aside the sale, nor to dispute the purchaser's title, nor, as we interpret her petition, does she complain that the executors selected as the property to be sold, that which comprised a specific devise in which she had an interest. Her grievance is that the executors used the proceeds of this sale to lift a mortgage on a parcel which was specifically devised to others. Her contention as to this runs counter to nothing contained in either of the two Code sections quoted above. The question is not whether she shall contribute, nor whether there shall be a pro rata abatement in what she would otherwise receive, but whether, as between the devisees of the mortgaged property and the devisees of another specific devise, the mortgage debt should be borne by the devisees of the mortgaged property. The answer to this inquiry, under an almost unbroken line of authorities, is that as between the two, the debt must be borne by the devisee of the mortgaged property. See 2 Jarman on Wills (6th ed.), 2041, where after a discussion of the general subject, the author approves the following, taken from a leading case, as a true exposition of the law: "And a fortiori, a specific legatee of encumbered leaseholds can not call upon a specific legatee of unencumbered leaseholds to contribute towards the liquidation of the mortgage debt affecting the former exclusively." Woerner, in 3 American Law of Administration (3d ed.), 1724, *Page 456 lays down the same rule, and adds that where a specific legatee deprived of his legacy by the payment of a debt secured by mortgage, he will be subrogated to the right of the creditor against the land to the extent of his legacy. See also 4 Page on Wills (lifetime ed.), 298, § 1486. Each of the three texts last-above referred to is supported by numerous cited cases. For other authorities so holding, consult the note in 5 A.L.R. 488 et seq., and for the supplemental decisions, the A.L.R. Blue Book of Supplemental Decisions. While this court has not heretofore passed upon the precise question, Dudley, 128, contains the report of an early Georgia case, McLellan v.Wallace, passed upon by the judges in convention, which recognizes the soundness of the proposition, and quotes with approval from an English decision by Lord Chancellor Rosslyn holding that the right of a devisee to have an encumbrance on real estate removed could not interfere with a specific legacy. In our judgment, the allegations of the petition before us call for the application of the foregoing principle, show no reason why the plaintiff can not invoke it, and the prayers are sufficiently comprehensive to invoke appropriate equitable relief.

The demurrer was both general and special. One of the grounds was that the petition was prematurely filed, the interest of the plaintiff being that of a remainderman, and the life-estate having terminated. It may be conceded that under ordinary conditions a remainderman, while the life-tenant is still in life, could not bring a suit embracing the prayers in the instant petition; but for reasons stated elsewhere in this opinion, there is no merit in this ground. The demurrer makes the point that there is a misjoinder of parties defendant. In view of the character of the relief to which the plaintiff is entitled, if she establishes by proof her allegations, it was proper to join the legatees and devisees with the executors, since an accounting was sought, and the general equities of all the devisees were involved. Compare Redd v. Davis, 59 Ga. 823 (5). Certain grounds of the demurrer complain of the generality of charges made in the petition that the executors have received personal benefits out of the estate. The petition alleges that the report (return) filed by the executors is too general, and does not set forth facts sufficient to enable the plaintiff to determine whether the estate has been properly managed and accounted for, and she prays for a full accounting. It is argued by counsel for the plaintiff *Page 457 in error that an examination of the returns of the executors, "attached to and made a part of said petition," show: (a) that the residue of the estate was not sufficient to pay the unsecured debts; and (b) that plaintiff has received the entire benefits from the sale of property in which she had an interest. In support of this position, counsel makes an analysis of the returns, and says that they call for the application of the principle set forth in the Code, § 37-104. We have not followed counsel through as to this contention for the reason that it can in no sense be said, in view of the allegations on that subject, that the petitioner by exhibiting a copy of the returns meant to adopt them as correct. Therefore the foundation of counsel's argument crumbles, and with it must go the superstructure. We rule on what appears from the petition only. What matters of defense may or may not arise by plea or answer, are not matters, it is hardly necessary to add, which can be considered in deciding whether or not a petition should be dismissed. The plaintiff does allege that the executors have paid to themselves fees not permitted by law, and have improperly paid out attorneys' fees. One who is interested in an estate, sues the personal representatives, and prays for an accounting, is not presumed to be in position to go into detail, or to be able to particularize as to matters handled by the executors. One of the objects of an accounting is to have the facts brought out. She was entitled to an accounting for reasons which are hereinafter stated, and which sufficiently appear on the face of the petition. Hence that ground of the demurrer was without merit. All the grounds of special demurrer were properly overruled.

As heretofore indicated, if the plaintiff proves the case outlined in her petition, she is entitled to have the doors of equity opened to her. Are her prayers such as entitle her to relief? Aside from the one praying for process, and that she have judgment, there are four prayers: (1) that the defendant executors be enjoined from obtaining their discharge in the court of ordinary; (2) that they make a full accounting of their acts and doings as executors; (3) that the plaintiff have an accounting with Augusta Griggs Raines and Theodosia Hollingsworth Duskin (the devisees of the property on which it is alleged there was a mortgage paid off by the executors from the sale of property in which the plaintiff had a one-third remainder interest); and (4) for general relief. *Page 458

If a person, to whom is devised a certain property on which there is a mortgage, has no right to have it discharged by placing a burden on another property which is the subject-matter of a specific devise, and if the executors from the proceeds of the sale of property included in a specific devise have discharged the mortgage on the property first mentioned, then what equitable rights has the devisee of the property sold? And in what forum can she assert such rights? Against whom may they be asserted? And how can this be done? In the instant case, Mrs. Shipley, the plaintiff, has brought her petition in equity, naming as defendants the executors and the devisees of the property encumbered with a mortgage, which was discharged from the proceeds of the sale of the property in which she was the remainderman. All of the property owned by the testatrix at her death is liable for the payment of her debts; but under the authorities hereinbefore mentioned, the devisees of a specific legacy on which a mortgage lien exists take the same cum onere, except that the debt thereon may be discharged out of other property included within the residuum. In the instant case, according to the allegations, the mortgage was not discharged from the proceeds of the personal property of the testatrix, nor was property included in any residuum clause. The petition asserts that from the sale of property, included in a specific devise, in which the plaintiff had a one-third remainder interest, a mortgage debt on another parcel of property, specifically devised to two of the defendants, was discharged. Since under the general law it was the duty of the executors to discharge this particular mortgage debt from the personal property of the testatrix, if any she had, and since the petition charges that certain funds belonging to the testatrix have been misapplied by the executors, it was proper for her to seek an accounting against the executors in order to determine what sum of money they had on hand, if any, which could and should have been applied to the discharge of this mortgage debt. It was likewise proper to join as defendants the two devisees of the special devise on which the mortgage rested in order that the equities of the case might be made equal. The executors were parties; and in view of the fact that the accounting sought against them was based in part on allegations that funds were improperly expended, and therefore could be used, for aught that appears in the petition, towards the discharge of the mortgage *Page 459 debt, they were properly joined as defendants. While, as was held in Butler v. Durham, 2 Ga. 413, and numerous decisions following it, where there is a special prayer and a general prayer, the complainant under the general prayer may have such other relief only as is consistent with the case made in the bill, and with the special prayer; yet it is well recognized that where a petition shows a good case for equitable interference, it ought not to be dismissed on demurrer for want of a proper prayer, if there be a general prayer for relief. Smith v.King. 50 Ga. 192. In that case it was said: "The prayer of the bill, it is true, is not very precise in its requests, but there is a general prayer for relief, and we think the bill contains charges justifying its retainer for such relief as, under the law, its facts demand."

Since the executors were proper parties, the plaintiff had the right to insist that their application for discharge be stayed; and since an accounting, at least with those who benefited by the payment of the mortgage debt, was proper, the prayer for general relief would entitle the plaintiff to be subrogated to the rights of the original mortgages to the extent necessary to protect her own rights, such remedy being consistent with the specific prayers. In Matson v. Crowe, 193, Ga. 578 (19 S.E.2d 288), it was ruled that a prayer for general relief is sufficient to grant to a complainant such relief as is consistent with and entirely within the scope of the pleadings, provided the nature of the case is such that under the general prayer some character of relief may be granted which is consistent not only with the case made by the petition but also with some specific prayer therein. There is respectable authority for the proposition that where, as alleged in this case, a devisee by the sale of property devised to her is deprived pro rata of her legacy because of the sale of the property devised, the proceeds of sale being applied to a debt secured by a mortgage on other property specifically devised, she will be subrogated to the right of the creditors against the land to the extent of the value of her interest in the property sold and the proceeds so applied. 3 Woerner on The American Law of Administration (3d ed.), 1724, par. 494, and the cases cited in note 7 therein. According to the allegations, the plaintiff has a one-third remainder interest only. The court may on the trial ascertain the value of this interest in relation to the entire amount of the proceeds of the property which went towards *Page 460 the discharge of the mortgage lien, and if the proofs support her contention, adjudge that she is entitled to be subrogated pro tanto to the holder of the mortgage lien on the specific legacy discharged by the executors.

We are not determining that this would be the only appropriate remedy to which the plaintiff would be entitled. We pass upon exceptions to rulings made by the trial court only. Whether this would suggest itself as the proper remedy to award the plaintiff in the event she proved her case as laid, is a matter which will address itself to the sound discretion of the trial judge. Since under the plaintiff's allegations she is entitled to substantial equitable relief, it was proper to include in her prayers that the executors be enjoined from further applying for their discharge, and that the accounting be had.

Judgment affirmed. All the Justices concur.