Dowd v. Estate of Dowd

Rehearing denied January 3, 1941. *Page 158 [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 159 Respondent, Leonore D. Dowd, is the widow of David F. Dowd, deceased, and is the administratrix of her husband's estate. She had a claim against "The Estate of David F. Dowd. Deceased," and in conformity with the provisions of sec. 15-621, I. C. A., the claim was presented to the probate judge who rejected the same; thereupon she instituted an action in the district court against the estate and recovered a judgment. "The Estate of David F. Dowd, Deceased," appealed from the judgment as did also David G. Dowd, Gertrude Dowd Bartlett and Jenny Dowd *Page 161 Benthin, who as heirs of the decedent had intervened in the case. Respondent has moved to dismiss the appeal on the following grounds:

"1. "That the appellant, 'The Estate of David F. Dowd, deceased', is not an aggrieved party which may appeal under the provisions of Section 11-103, Idaho Code Annotated.

"2. "That an 'Estate' which is sued by that name or that appellation, under the provisions of Section 15-621, Idaho Code Annotated, may not appeal to the Supreme Court from a judgment of the District Court establishing the claim of a claimant as defined in said section of said code.

"3. That there is no statutory authority within this state authorizing an 'Estate' to bring suit or defend an action except the power to defend an action under the provisions of said section 15-621, I. C. A."

Taking up the grounds of the motion in the order in which they are stated, it would seem that the first contention is answered by this court in State. v. Eves, 6 Idaho 144, 148,53 P. 543:

"The test as to whether a party is aggrieved or not is: 'Would the party have had the thing if the erroneous judgment had not been entered?' If the answer be yea, he is a party aggrieved.' " (Washington County Abstract Company v. Stewart,9 Idaho 376, 381, 74 P. 955.)

These cases have been cited and the rule there stated followed continuously ever since it was announced: Hanson v.Weniger, 31 Idaho 540, 543, 173 P. 1085; Rural High SchoolDist. No. 1 v. School Dist. No. 37, 32 Idaho 325, 329,182 P. 859; Oatman v. Hampton, 43 Idaho 675, 691, 256 P. 529; Renfrov. Nixon, 55 Idaho 532, 537, 45 P.2d 595; In re Blades,59 Idaho 682, 684, 86 P.2d 737, and cases there cited; Stateex rel. Murphy v. Superior Court, etc., 30 Ariz. 620,249 P. 768, 770; Kondas v. Washoe County Bank, 50 Nev. 181,254 P. 1080, 1081.

Here the estate will have to pay the judgment if it is not reversed, vacated or modified. The estate is therefore aggrieved. *Page 162

Under the second and third grounds of the motion, it is contended that an "estate" as such cannot appeal because it is not so authorized and has no identity. We will consider these two grounds together and to do so it is necessary to consider the terms of the statute authorizing presentation and prosecution of claims against an estate and the right of appeal. Secs. 15-604 and 15-605 provide for the presentation of claims and sec. 15-607 provides that

"When a claim, accompanied by the affidavit required in this chapter, is presented to the executor or administrator he must, within sixty days after its receipt, indorse thereon, his allowance or rejection, with the day and date thereof."

Sec. 15-608 provides that every claim, allowed by the executor or administrator and approved by the probate judge, must be filed in the probate court, and thereafter must "be ranked among the acknowledged debts of the estate, to be paid in due course of administration"; and sec. 15-609 provides:

"When a claim is rejected, either by the executor or administrator, or the probate judge, the holder must bring suit in the proper court against the executor or administrator, within three months after notice of its rejection."

It should here be observed that the action on a rejected claim, presented to the administrator or executor, must be commenced "against the executor or administrator," so there is no doubt about the designation of the party defendant in such cases. Sec. 15-621 provides for the extraordinary condition which arises when an executor or administrator has a claim against the estate he is administering. In such case, if the claim is rejected by the probate judge, "action thereon may be had against the estate by the claimant," the section in full reading as follows:

"If the executor or administrator is a creditor of the decedent, his claim, duly authenticated by affidavits, must be presented for allowance or rejection to the probate judge, and its allowance by the judge is sufficient evidence of its correctness, and it must be paid as other claims, in due course of administration. If, however, the probate judge rejects the claim, action thereon may be had against the estate by the claimant, and summons must be served upon the probate *Page 163 judge, who may appoint an attorney at the expense of the estate to defend the action. If the claimant recovers no judgment, he must pay all costs, including defendant's attorney's fees."

It seems quite clear, from the change of language used in the last quoted section, that it was the intention of the legislature to require the action to be against the estate ofthe deceased where the claim is prosecuted by the administrator or executor, after it has been rejected by the probate judge. It was not the intention to have the action prosecuted againstthe probate judge, although the statute provides that the summons shall be served on the probate judge and that he shall appoint an attorney, at the expense of the estate to defend the action.

It is further contended that the "estate" cannot appeal, for various reasons, among which it is contended, the judgment merely establishes the claim and that it is not a final judgment within the meaning of the statutes authorizing appeals from district courts. (Sec. 11-201, I. C. A.) That contention was answered by this court in McElroy, Administrator, v.Whitney, Administratrix, 24 Idaho 210, 214, 133 P. 118, in which the court determined when such a judgment became final and, among other things, said:

"The judgment entered on May 1, 1912, was the final judgment in this action, and the amendment merely a correction, which was in fact not necessary to make the judgment conform to said provisions of the statute."

The judgment of the district court rendered on the verdict of the jury was just as much a final judgment as the judgment entered on any other claim or demand, which might have been prosecuted against any individual or corporation. (Poage v.Co-op. Pub. Co., 57 Idaho 561, 66 P.2d 1169, 110 A.L.R. 1322, and cases cited; sec. 11-201, I. C. A.)

It has been argued that under secs. 15-1115, 15-1118, and 15-1119, I. C. A., all claims allowed and judgments upon claims presented and disallowed are subject to objection and contest on hearing of the final report and settlement of account of the administrator or executor and are therefore not final. Clearly, such is not the case as to heirs and beneficiaries of the estate who are made parties and appear *Page 164 and defend in an action prosecuted against the estate upon a rejected claim. In such case, they have already had their day in court and the judgment has become final as to them.

The motion to dismiss the appeal is denied.

Before entering upon a consideration of the appeal on the merits, it is deemed advisable to state in more detail the essential facts involved: Respondent and David F. Dowd were married December 26, 1914; at the time of their marriage, respondent owned separate property of the probable value of $15,000. From July 14, 1914 (prior to their marriage), to June 21, 1921, respondent loaned Dowd sundry amounts, ranging all the way from a minimum of $11 in one loan, thence up to $1,020 in the maximum loan, aggregating the sum of $11,496.04. On these advances Mrs. Dowd computed interest from the date of each loan to the later date of presentation of claim in the probate court. After these various loans had been made and on October 22, 1930, Mr. Dowd executed and delivered to respondent the document, referred to as Exhibit "A" and sometimes called the "blue paper," a copy of which is as follows:

"ACKNOWLEDGMENT OF INDEBTEDNESS AND AGREEMENT. I, David F. Dowd, husband of Leonore D. Dowd, do hereby acknowledge that I have received from Leonore D. Dowd, out of her personal funds and separate property, the sum of Eleven Thousand Five Hundred Dollars ($11,500.00), which said sum has been invested by me in the property known as the Dowd-Bucklin property, situated on the Southeast corner of Park Avenue and 'B' street, in the city of Idaho Falls, Idaho.

I hereby agree that the said sum shall be a charge upon my portion of the said described real estate, and shall be deemed and considered as an investment of the said Leonore D. Dowd in the aforesaid property, re-payable to her when the said property is sold, or, if not sold, payable to her out of my estate upon my death.

For the purpose of acknowledging the said indebtedness and its re-payment, I hereby promise and agree that the said *Page 165 sum shall be paid to her upon the sale of said property, or, whichever happens first, immediately upon my death.

IN WITNESS WHEREOF, I have hereunto set my hand this 22nd day of October, 1930.

Signed, D.F. DOWD.

State of Idaho, } } ss. County of Bonneville }

On this 22nd day of October, 1930, before me, the under-signed Notary Public, personally appeared David F. Dowd, known to me to be the person whose name is subscribed to the above and foregoing acknowledgment of indebtedness and promise to pay, and who acknowledged to me that he executed the same, and for the purpose therein stated.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year last above written.

O.A. JOHANNESEN Notary Public. Residence and Address: (SEAL) Idaho Falls, Idaho."

April 26, 1933, Dowd executed and delivered to his wife a note and mortgage for $11,000 to cover his existing indebtedness to her and thereupon she returned to him Exhibit "A" (the agreement above set out). During the month of June, 1933, they were divorced and November 3d of that year they remarried. There was a first mortgage on the property, securing a large indebtedness due to John W. Cage, and on the latter's death, it became necessary to refinance the property by borrowing money from a new source. January 24, 1934, Mrs. Dowd executed a release of the (second) mortgage and delivered the mortgage, note, and release to Mr. Dowd who, at the same time, redelivered to her the "blue paper" (Exhibit "A"). This latter transaction appears to have taken place because of Dowd's necessity to secure a loan on the property covered by this mortgage. The parties remained husband and wife from November 3, 1933, until the death of Mr. Dowd, April 6, 1938.

The total claim preferred was for $11,496.04 principal and accrued interest in the sum of $14,347.13. After the claim *Page 166 was rejected by the probate judge, respondent filed her action in the district court and, among other things, set out the claim in full as presented to the probate judge, the action of the judge thereon and prayed judgment against the estate for the "sum of $11,496.04 with interest as may be allowed by law on the specific items going to make up the account stated referred to in the writing of October 22nd, 1930, less the said sum of $350.00 credited on said account." The latter amount was paid by check of Mr. Dowd, at respondent's instance and request, for a debt owed by respondent to Mrs. Sylvia Mott.

Prior to entering upon the trial, and upon the motion of the defendant, the court entered an order requiring the "plaintiff to elect between the cause of action against the defendant for any loan to the decedent during his lifetime by the claimant from her separate property and the cause of action alleged in said complaint on the acknowledgment of indebtedness and agreement"

set out in the claim in the probate court and the complaint as filed in the district court.

In compliance with the foregoing order of the court, respondent filed a notice of election of remedies in which she said:

"the plaintiff hereby elects to pursue her cause of action on the written contract a copy of which is set up as a part of paragraph 15 in plaintiff's said complaint."

The jury returned their verdict in favor of respondent and against the estate for the sum of $12,380.28 and judgment was thereafter entered upon the verdict.

Two principal contentions are urged here for a reversal of the judgment: (1) That the complaint is insufficient to state a cause of action, on which respondent elected to proceed in the trial and is not the same cause of action stated in the claim as presented to the probate judge; and that such claim is insufficient and inadequate to support the action or a verdict and judgment thereon. Appellant cites and relies onVanderpool v. Vanderpool, 48 Mont. 448, 138 P. 772, and Flynnv. Driscoll, 38 Idaho 545, 557, 223 P. 524, 34 A.L.R. 352, in support of the contention that the creditor *Page 167 "could not come into court and allege or prove any other or different cause of action than that stated in the claim."

The rule stated in these cases is sound and not open to serious debate in this court. The main question to be determined is: Does the claim presented in this case give notice to the probate judge and all persons interested in the estate of the character and nature of the claim asserted by the creditor; and does it furnish the legal representative of the estate with sufficient information to enable him to properly investigate the claim before allowing or rejecting it? That is the purpose, of course, of requiring the claim to be properly made out, verified and presented to the probate court.

When we turn to the claim here under consideration, we find that respondent has set out in her complaint a full and true copy of the claim as she presented it to the probate judge. The written acknowledgment, dated October 22, 1930, of the indebtedness and a promise to pay, was founded upon a good and valuable consideration, namely, the extension of time for payment. The exact date of maturity is not specified but the agreement contains a statement of the event that must happen in order to mature the obligation, which was absolutely certain to occur. The contract says:

"said sum has been invested by me in the property known as the Dowd-Bucklin property"

(followed by statement of exact location of the property) and further recites:

"I hereby agree that the said sum shall be a charge upon my portion of the said described real estate, and shall be deemed and considered as an investment of the said Leonore D. Dowd in the aforesaid property, repayable to her when the said propertyis sold, or, if not sold, payable to her out of my estate uponmy death." (Italics supplied.)

It was known at the time this agreement was signed that one of these events would be sure to occur, that is, the debtor would either sell the property in his lifetime, in which event the debt would mature, or if he didn't sell it, he was sure to die some time, which alternative would mature the debt. The order of the trial court, requiring an election in no way changed the status of the claim; it was still an action *Page 168 on contract. (Darkell v. Coeur d'Alene etc. Trans. Co., 18 Idaho 61,108 P. 536.)

The written acknowledgment granting the extension of time for payment, while it was for a lump sum of $11,500, was merely an acknowledgment of the already existing indebtedness and coupled with an extension of time for payment, which prevented the running of the statute of limitations against the original loans. The contention that the acknowledgment of indebtedness disproved the existence of the contract to pay the loans is without merit. It is very clear that it is all the same indebtedness; the obligations to pay are merely consolidated and reduced to a single promise to pay the whole in accordance with the terms of the written agreement or acknowledgment of October 22, 1930.

(2) Appellant further contends that error was committed in allowing the respondent to testify concerning certain transactions had in connection with these loans and the written acknowledgment of indebtedness, for the reason that her testimony was inhibited by sec. 16-202, I. C. A., which reads in part as follows:

"Who may not testify. The following persons cannot be witnesses: . . . . 3. Parties. . . . . against an executor or administrator, upon a claim or demand against the estate of a deceased person, as to any communication, or agreement, not in writing, occurring before the death of such deceased person."

In considering the 1927 amendment to our statute (1927 Sess. Laws., chap. 51, p. 67, sec. 16-202, I. C. A.) in Hubbard v.Ball, 59 Idaho 78, 84, 81 P.2d 73, we said:

"The amendment limits the prohibition of the statute to testimony 'as to any communication, or agreement, not in writing, occurring before the death of such deceased person.' Respondent was competent to testify as to services performed by him for deceased and as to the value thereof. . . . ."

This statute was evidently changed for a purpose and that purpose must have been to relax instead of restrict the rule. By the original statute (sec. 7936, C. S.) the testimony was prohibited "as to any matter of facts occurring before the death of such deceased person," whereas the amendment only prohibits testimony "as to any communication, *Page 169 or agreement, not in writing, occurring before the death of such deceased person." (Italics supplied.) By the amendment, there is no prohibition against a claimant testifying tooccurrences in relation to or in connection with a contract or agreement in writing; such, for example, as delivery of the agreement, possession thereof, and payment or non-payment, or rendition of services, or furnishing goods or material thereunder, and similar facts or circumstances. On the other hand, the prohibition extends to and comprehends contracts and agreements not in writing.

The essence of the objections to the question and the testimony admitted is contained in and illustrated by the following question and answer:

Q. "What occurred in January, Nineteen thirty-four, with relation to the mortgage and note referred to and this blue paper, Exhibit 'A'?

A. "Mr. Dowd was heavily involved at this time, and it was necessary for us to refinance, and in order to get the money to refinance the building, and bring it up where it should be, the mortgage company wouldn't loan the money unless I released the mortgage; and I did this, and in return for giving him the mortgage and the note I received the blue paper to keep until I was paid."

After argument by the respective counsel, touching this question and answer, the court ruled as follows:

"Well, her statement for the purpose of its delivery, I think, is objectionable. That latter part of the answer will be stricken. The fact of its delivery, of course, remains in the record."

Thereupon Mrs. Dowd further testified that she had had this document (Exhibit "A", the "blue paper") in her possession ever since it was redelivered to her in January, 1934, and that nothing had ever been paid on it except $350 February 2, 1936.

The contention is made that the testimony relating to the release of the mortgage and the return of the mortgage and note to Mr. Dowd, and the redelivery to Mrs. Dowd of the agreement (Exhibit "A") was in effect testimony establishing a new and independent contract. Such contention *Page 170 though plausible is unsound. The promise to pay, on the happening of one of the two alternatives, was in writing and testimony of the delivery, continuous possession of the writing, happening of the maturity contingency, and non-payment of the debt, were all touching facts which arose after the "agreement" was "in writing." The contract itself was evidenced by the writing; in such circumstance the other facts involved were subsequent and collateral to the writing and testimony concerning the same was not prohibited by the statute.

There is sufficient competent evidence to support the verdict.

Appellant also complains of the action of the court in requiring arguments to be made before instructing the jury. It is contended that, under sec. 7-206, I. C. A., it was the duty of the court to give his instructions to the jury before the arguments of counsel were made. All we find in the record, touching this matter, is as follows: After the conclusion of all the evidence in the case:

The COURT: ". . . . You may open the argument.

(Counsel for the respective parties then argued the case to the jury. And the argument being concluded —)

The COURT: "We will recess at this time."

No request appears to have been made by counsel in relation to the matter, nor does it appear that any objection was made or exception taken.

In Schmidt v. Williams, 34 Idaho 723, 732, 203 P. 1075, this court said:

"The record does not disclose that appellants interposed any objection to the order of procedure adopted by the trial court, or requested the court to proceed in the order indicated by the statute. Had such objection or request been made, the case might be different. We do not think such a departure as this from the order prescribed by the statute should be held to be reversible error, in the absence of such request or objection."

(See, also, Byington v. Horton, 61 Idaho 389,102 P.2d 652, 657.) *Page 171

The judgment will be affirmed, and it is so ordered, with costs to respondent.

Givens and Holden, JJ., concur.