and others v.
(Circuit Court, D. Connecticut. July 29, 1881.)
1. EVIDENCE-BuRDEN OF PROOF.
The burden of proof is. on him who charges a trustee with surcharging and falsifying his accoun ts.
TRUST FuNDS-BuEACH OF TnusT.
A trustee cannot use trust funds for his own profit.
Exceptions to Master'Ei Report. SHIPMAN, D. J. The .first exception of the defendant to the master's report is allowed, on the ground that there was not, in my opinion, sufficient affirmative evidence that the defendant received $125 for the store fixtures. The second exception of'the defendant to the master's report is allowed in Paxt, to-wit, to the extent of $30, and interest thereon. As to the remaining $35 this exception is not allowed.. The third, fourth, fifth, sixth, seventh, eighth, and ninth exceptions of the defendant to the master's report are disallowed. With the exception of the first, and $30 and interest on the second, item contained in the master's report, and the corresponding COl'rections to be made in the computations of interest and in the addition of figures, the master's report is confirmed. The ground of all the exceptions is substantially the same, viz.: that the master erred in this, that he mistook upon whom lay the burden of proof of the items attempted by the plaintiff to be surcharged and falsified in the account of November 17, 1871, and was of opinion that the defendant was bound affirmatively to account for all moneys belonging to the estate which came into his hands; whereas the master should have held and been of opinion that the plaintiffs were bound to prove, by sufficient affirmative evidence, the facts alleged in their bill, and to show affirmatively that the alleged alterations should be made. I am of opinion that the idea of the defendant in regard to the master's action is incorrect, and that the defendant's and the master's theory in regard to the burden of proof was the same; and that, in any eveI}t, the plaintiff affirmatively proved, and the defendant did not disprove, the facts found by the master in regard to each of the items except the first and second.
It will be. sufficient to state the facts in regard to the two principal items, viz., the Rock Island bonds and the Peninsula bonds. 'l'he Rock Island bonds: The plaintiffs clearly showed the various amounts of money which belonged to the trust fund, and which went into the hands of the defendant in 1858, 1859, and 1860. This money the defendant invested, either for himself or for the estate. It was incumbent upon the plaintiffs also affirmatively to prove their allegations in the bill that a portion of this money was invested in five Rock bland bonds. Circumstances, not strong when viewed singly and disconnected from their fellows, but significant when viewed in connection with each other and with the admitted facts, show that the defendant did make such an investment. Two of these bonds were omitted in the original account. It was manifest that the defendant had received money of the trust estate which it was his duty to invest for its benefit, and which it had not received. The question, in what, if anything, was it invested? was not so easy of solution. From the nature of the case, the allegations of the plaintiffs must be proved, if proved at all, by separate circumstances, which, when' placed together, should be strong enough to support the plaintiff's theory. This affirmative proof I think they have furnished. "The Peninsula bonJs: The affirmative proof, that the money of the estate was knowingly used to pay for these bonds at 80 per cent., while they were turned over to the estate at enhanced prices, is so strong that it cannot suc. cessfully be resisted. The defendant was not employing his own ·but the estate's money in this investment. His idea, at the time of the purchase, in regard to the ownership of the bonds, cannot be exactly ascertained. Probably it was to call them the estate's, if they advanced in price, and his own, if they went down. However this may be, when he finally determined to treat them as the estate's property, it was his duty to account for them at .the price which the estate had paid, and not at an enhanced price. He could not use the estate's money in the purchase of bonds, treat the coupons as his own, and then profess to resell .the bonds to the estate at a large profit. The investment should be regarded as the estate's from the time of the purchase. It cannot be denied that the silence of the defendant, in the face of facts which were very significant, has made the task of the master and the court, in weighing testimony, more easy than it otherwise .would have been, for there has been no rebutting testimony. Qne
. ,'I'EDEBAL ·BEfOBTEU.
would naturally suppose that, in view of evidence which could not but be considered as damaging, the defendant would have. made such statements Hnd explanations as might tend to satisfy a trier that the inferences which 'were sought to be drawn from the evidence were unfounded. He made, howeverjbllt little explanation; and, when his case was known to be iridanger,he apparently furnished his able ,and ingenious counsel ,with, no theory which they could press upon the attention of the court. There should be a final :decree in accordance with the findings of modified in this opinion.
& MICHIGAN SbU'I'FnJRN R. Co. and 'others."
S. D. New
York. March 9, 1881:)
On a joint clainl join:i action must be brought.
PARTNERSHIP-EXECUTQR OF DECEASED PARTNER-Sun' ON'pARTJ>'"EnSIDP CLAIM.
A bill, brollght byth"e'exeoutor of a deceased partner to such partner's share in a partnership dlMm, is:demurrable, though the surviVing partners were made defendants in the bill, and though the !Jill alleged that they ,'had been requested to join as but had refused to so·
.George NO'1',riB, for plaintiff. '.
John E. Burrill, for defendants. BLATcHFoRD, C. J. By death of John T. Alexander,' the Bole andexchisive ;right and reduce into possession the claim which is the subject"matt13r :0f this suit survived to the surviving -partners of the firm. Theelaam is a claim which belonged to the partnership as such. It was a joint claim, !lnd nota claim in which, .as.respected the defendants, or any suit against them to recover the claim, the members of the copartnetship had a several interest, or ltn interest which would have authorized anyone of them to maintaill 'a Stut, to recQverhis aliquot share of the claim before the de.ath of any one'of the partnSTS.. The: two surviving partners are made de· fendants. The 'louit:is brought by the executor of the dec1lased partner to recover only the share of the deceased partner in thaclaim. The claim iii '& unit. The surviving partners are the only proper 'persons toaue for the claim.· Ifl"onany allegations, the executor'of the deceased partner could be.l:tHowed to sue, making the two ling partners defendants, hecouJ.d not do so alleging that th&
.See t4 }<'ed. Rep. 261.