In re the Estate of Lichtenstein

Arnold, S.

The question which was suggested to counsel in this matter was not as to whether the petition contained the necessary allegations giving this court jurisdiction to issue citations to the necessary parties, to the proceeding, but whether certain allegations therein made (and which, as the petitioner applies as a creditor only, were unnecessary to be made a part of the petition, under section 2752, subd. 4, Code), if true, would not render the proceedings futile, the present application being for a decree under section 2759, Code. Whether proceedings for the sale of the real estate of a decedent to pay debts are instituted by a creditor or by an executor or administrator, before a decree can be made for such sale proof must be made as. provided in subdivision 5 of the last named section. The petition herein states that all the personal property of the testatrix has been applied by her executor to the payment of her funeral expenses, and the excess thereof, if any, paid over to. her children as legatees under her will. Of course, if there was no excess, a deficiency of personal assets necessary to pay debts would be shown; if, on the contrary, such excess existed, and it was distributed among the legatees, a question would then arise *500as to whether the proof required by section 2759, subd. 5, could be made. In Kingsland v. Murray, 133 N. Y. 170, which was a proceeding instituted by an administratrix de bonis non for the sale of real estate to pay debts, it appeared that the decedent left personal property in excess of his debts, which came into the hands of the original administrator, who was the son and only heir at law of the intestate, and for which he had never accounted. His letters had been revoked, and the petitioner appointed in his plane. The Court, at page 174, referring to the provision of the Code' last above mentioned, says.: “ There seems to be some difference of opinion between the Surrogate and the General Term as 1» the scope and meaning of this provision. We think the meaning is reasonably free from doubt. If the decedent, at the time of his death, left sufficient personal property which could have been applied to the payment of his debts and funeral expenses in the exercise of reasonable diligence on the part of his executors or administrators, then resort cannot be had to the statutes for the sale of his real estate for the payment of his debts. In that event the personal property is the fund for the payment of his debts, and the creditors must, resort to that through the executors or administrators. If they waste or squander the personal property, so that it becomes insufficient for the payment of the debts, the only resort for the creditor is to them, to enforce their personal responsibility; and they cannot in that case cause the real estate to be sold under the statutes referred to. . . . So, in the language of this section, before the Surrogate can make a decree for the sale of the real estate, the petitioner must establish that all the personal property of the decedent which could have been applied to the payment of the decedent’s debts and funeral expenses has. been so applied.”

And it is further held that if the executors or administrators have proceeded with reasonable diligence in converting the personal property into money, and applying it to the payment of the debts and funeral expenses, and it is insufficient for the pay*501ment of the same, then, even if it has not all been so applied at the time of the petition, the Surrogate is authorized to make the decree; and at page 176 it is further said that under' this construction of the statute an irresponsible executor or administrator may so waste and misappropriate the personal property of a decedent that none of it could be applied h> the payment of his debts, and that thus a proceeding to sell the real estate could not be maintained, as it could not be shown that the executor or administrator had proceeded with reasonable diligence in converting and applying the personal property to the payment of debts, and there may, therefore, be cases, although rare, where the creditors may not be able to compel the sale of the real estate of the decedent for the payment of their debts under the provisions of the Code referred to; and the Court then proceeds to point out other remedies which creditors may have in such cases, among which is the right of action against the next of kin who have received any of the personal property. In the present case the petition shows that no publication of notice requiring creditors to present their claims has ever been made. Meanwhile the real estate has been conveyed by all the devisees but one to that one who has been cited, but neither opposes nor consents to the present application. Notwithstanding such default, however, the Surrogate must, before granting a decree of sale, have before him all the proofs required by the statute. The decision in Kingsland v. Murray does not draw any distinction between cases of executors and cases of administrators, but applies a general rule in respect to administration, by either. In Matter of Bingham, 127 N. Y. 296, decided in the Second Division of the Court of Appeals, about a year earlier than the decision of Kingsland v. Murray, some general language is used at pages 309, 310; which appears to draw a distinction between eases of administrators, who give bond and those where executors have squandered the personal property which came into their hands as such; but in that case it appeared that the personal property applicable to the payment of debts was not a,t any time *502sufficient to make suck payment in full. In the Kingsland case the administrator, who was also the only next of kin and heir at law, had appropriated the personalty to his own use; and in the present ease the executor, who was a son and one of the devisees and heirs at law of the testatrix, divided the personalty between himself and his co-devisees. These two cases are, therefore, practically alike in their circumstances. The petitioner herein should have the opportunity of showing the amount of personalty which came to the executor’s hands, the debts owing by the testatrix, and the disposition made of the personalty, so that it may be ascertained whether all of such personalty which could have been applied to the payment of decedent’s' debts has been so applied, or that the executor has proceeded with reasonable diligence in converting the personal property into money, and applying it to the payment of these debts and funeral expenses, and that it is insufficient for the payment of the same; and a reference is ordered to take proofs as to such matters required to be established by the decree prayed for herein, under section 2759' of the Code.

Ordered accordingly.

(Note as to sale of decedent’s real estate for the payment of debts:)

Where the personal estate is insufficient to pay the debts, a creditor has' a remedy by proceedings for the sale of the real estate. (Matter of Gill, 42 Misc. Rep. 457.)

Where the debts are not charged on the real estate, and the personal property is insufficient to pay them, the widow and executrix who pays them without taking assignments from the creditors is entitled to be subrogated to their rights and may maintain a proceeding for the sale of the realty to reimburse her. (Matter of O’Brien, 39 App. Div. 321.)

A sale of the realty cannot be had for payment of administration expenses alone or for debts incurred after decedent’s death, except funeral expenses. (Matter of Quatlander, 29 Misc. Rep. 566.)

A power of sale “for any purpose that the executor, in his best judgment, may think proper” is not imperative, and does *503not prevent proceedings to sell real estate for payment of debts. (Matter of Johnson, 18 App. Div. 371.)

Where sufficient personal property was left to pay debts, the fact that the executor misapplied it does not authorize the creditors to resort to the real estate. (Matter of Very, 24 Misc Rep. 139.)

Where a devisee dies after the lapse of three years, a creditor of the testator is entitled to be made a party to a proceeding to sell the land for the payment of the deviseeis debts. (Matter of Fielding, 30 Misc. Rep. 700.)

The petition need not state the value of each parcel separately where they lie together. (Matter of Georgi, 35 Misc. Rep. 685.)

A creditor has no right to answer the petition. (Matter of Campbell, 66 App. Div. 478.)

To sustain the proceeding, it must be shown that the assets, when duly administered, would not pay the debts. (Matter of Meagley, 39 App. Div. 83.)

The real estate can be sold only to the extent that the personal property applicable to the payment of the debts was insufficient, although the administrator was insolvent. (Matter of Georgi, 21 Misc. Rep. 419.)