
    *Granberry’s Executor v. Josiah & James Granberry.
    October Term, 1793.
    [1 Am. Dec. 455.]
    Executors — When Answerable for Paper Money at Scale of Depreciation. — To make an executor answerable for paper money at the scale of depreciation of the day on which he received it, is, in general, wrong; but if he has charged himself so in his accounts. and points out no other mode of adjusting it, he shall be bound by his own act.
    Same — Liability to Pay Interest on Money in Hands.— There is no general rule as to an executor’s liability to pay interest on money in his hands. In this case, he was charged with it from the end of each year for the balance then resting in his hands; butsuch interest is not to be carried to the balance of the succeeding years.
    Executorship — Renunciation—Right to Legacy. — A legacy is given to an executor, as nephew of the testator. He will be entitled to the legacy, though he renounce the executorship.
    Executor — Allowed Use of Money by Will — Payment.— An executor by the will is allowed the use of 6001. for live years, without interest. He may pay it in depreciated paper money, and the entry of such payment in his accounts, will be evidence of the payment.
    Executor Who Is Also Legatee — Right to Commissions. —An executor, to whom a legacy is left as nephew of the testator, is entitled to his commissions also, and that by custom is generally' fixed at five per cent, on actual receipts.
    Executors -Unequal Legacies Qiven to — Right to Res ill. uum.— unequal legacies given to executors do not exclude them from the residuum.
    The appellees filed their bill in the High -Court of Chancery against the appellant, the executor of their father, and their guardian, for an account.
    To the report of Auditors made in the cause, the appellant took the four following exceptions. 1st, That his receipts of money in depreciated paper, are reduced by the scale of depreciation, on the day they were received, without any proof that he received it unnecessarily, or delayed paying it away to those who were entitled to it.
    2dly, Interest is allowed on monies in his hands, as if he were a debtor, or had retained the same improperly, and that too at a time, when borrowers of good credit were not to be met with, and when the executor neither did nor could make a profit thereby.
    3dly, No commissions are allowed him.
    4thly, That ^500 due from him to the testator and to be paid in June 1779, and which was paid on the day, is charged to him as specie.
    The report being confirmed by the High Court of Chancery, the defendant appealed.
    Eonold for the appellant. As to the first exception. — An executor, is in the nature of a trustee, he receives no benefit from the execution of his office, and should therefore be subject to no injury, unless he hath produced it by his own misconduct. An executor is not only compelled to receive the debts of his testator, but is bound to solicit and to enforce the payment of them. ITor if they should be lost by his neglect, in not using the proper means of obtaining payment, he must sustain that loss. In this situation therefore, it would be unjust, to burthen him with the loss, by depreciation of money ; thus forced into his hands, and at a time, when perhaps no opportunity offered of applying it. Some reasonable time then, should be allowed him, to dispose of the money, before the scale can with justice be applied.
    Second exception. — -Where the risk must be run by the executor, he is not bound to pay interest. This is laid down in the case of Ratcliff v. Graves, 1 Vern. 179; and tho’ in that case, interest was decreed, yet it was upon a principle, which does not apply in this country: it was, that the money might *be insured. So, an executor who changes the nature of a debt, due to the testator, becomes liable himself to pay it, out of his own pocket — 1 Vern. 473. An executor is not liable to pay interest, even in England, unless he make a profit by the principal. Brow. Ch. Rep. 359, Newton v. Bennet. The Chancellor was therefore mistaken, (as I humbly conceive,) when he presumed the appellant had made a profit, because the contrary was not shewn. The executor could not in this case, distribute the money amongst the légatees, who were under age, and who of course, could not give him a discharge; he was therefore compelled to retain it, and unless it appeared, that he made use of it, nothing can be more unrighteous, than to force him to pay interest.
    It is true, that the appellant stands in the double character of guardian and executor, but as the debts due from his testator, were not all discharged, he will be considerd as holding the money, in his capacity of executor. The interest, I consider as a reasonable compensation for his trouble, upon the same principle,- that he is entitled to the undisposed surplus, unless barred, by an express compensation allowed by the testator. There is no case to be found, which subjects a guardian to the payment of interest, from whence I conclude that he is not liable to pay it: and a guardian and executor appear to stand, much in the same situation; for if the former, take a bond for rent due to his ward, he is liable to pay it out of his own pocket, and the bond is his own. 2 Ch. Rep. 97.
    The law of this state, requires, that a guardian should annually return an account of the profits and of the income of the ward’s estate, to court; but this can only mean the real estate, to which, the words profit and income, are more properly applicable; unless indeed the guardian should lend out the money, in which case, the interest would be income, and to be accounted for.
    Third exception — The legacy given to the executor, is to be considered as a gratuity, independent of his trouble in executing the trust, and not in lieu of his commissions. If he had refused, he would still have been entitled to the legacy, and having undertaken the trouble, he ought' to receive a compensation for it.
    Fourth exception — The appellant, being an executor, was not thereby rendered incapable, of discharging a debt he owed to the estate of his testator, at the time it became due, more especially, as it appears in this case, that the payment was applied to the discharge of a debt, due from the testator. If so, he *is entitled equally with others to the benefit of the law, respecting payments in paper money.
    Campbell for the appellees.
    1st Point' — ■ Nothing can be more just, or reasonable, than that an executor, claiming to be charged on a day posterior to that, on which he received money, or in other words, with less than he received, should shew some good reason for such a pretension. It is a subject, susceptible of proof and of explanation.
    If the rule laid down by the Chancellor be rejected, to what other can we resort. The liability of an executor, if he do not recover his testator’s debts in a proper time, can only exist, where there was probable ground to apprehend insolvency, or the like; and in such cases only, can he be charged with such negligence as to render him personally liable. But at a time, when a depreciated paper money was in circulation, I should not hesitate, to consider an executor guilty of malfeasance in his office, who should press for the payment of his testator’s debts, unless under an evident necessity.
    2d point — The Chancellor, in the case of Newton and Bennet, which has been cited, says, that where it does not appear, that the executor applied the money to the purposes of the will, or unless he brings it into court, he shall be presumed to use it in the way of his trade, and be liable to pay interest for it. This case, is strongly in my favor. If there be debts due from the estate, and carrying interest, and the executor permits that interest to accumulate, when it might be avoided, it is right, that he should answer it out of his own pocket.
    3d point — By the laws of this state, a guardian receiving the estate of a ward, must annually render an account; and he is confined to the profits or other income, for the support of the ward, without being permitted to go farther. The word estate includes money, as well as land.
    
      
      Executors — Settlement of Accounts — Liability.—On the general subject of the rights and liabilities of executors in the settlement of their accounts, the principal case is cited in Hipkins v. Bernard, 2 Hen. ,& M. 21; Miller v. Beverleys, 4 Hen. & M. 416; Cavendish v. Fleming, 3 Munf. 201; Hite v. Hite, 2 Rand. 415; Burwell v. Anderson, 3 Leigh 354, 359, 361, 362; ■Garrett v. Carr, 3 Leigh 416; foot-note to Handly v. Snodgrass, 9 Leigh 484; Coltrane v. worrell, 30Gratt. 447; Dromgoole v. Smith, 78 Va. 668; Anderson v. Piercy, 20 W. Va. 302, 326; Hester v. Lyon, 40 W. Va. 16Í, 20 S. 33. Rep. 934: Pulliamv. Pulliam, 10Fed. Rep. 62.
    
    
      
      Executorship — Renunciation.—The principal case Is cited in Burnley v. Duke, 1 Rand. 113.
    
    
      
      Wills — Residuum—To Whom it Passes. — See the principal case cited in foot-note to Shelton v. Shelton, 1 wash. 53.
      See generally, monographic note on “Executors and Administrators” appended to Rosser v. Depriest. .5 Gratt. 6.
    
   The PRESIDENT

delivered the opinion of the court.

The first objection made to the report is, that the paper money is reduced by the scale of depreciation, on the day it was received by the executor. Upon general principles, such a rule, would certainly be improper and unjust; and especially too, when the money was received in a state of rapid depreciation. The executor may not be able to find a creditor, or legatee, to whom he could pay the money, on the day it was received, or the payment might be suspended in- some cases, by disputes amongst creditors for the preference.

*But in this case, the appellant has neither objected to the mode originally, nor pointed out any other, the propriety of which might be considered by the court: on the contrary, his accounts were stated by himself in the same manner, the debits and credits being reduced by the scale, on the day they were received and paid. -He ought therefore'to be bound by this mode, and the Chancellor did right, in over-ruling this exception.

The second objection, is to the charge of interest, as if the executor were a debtor, or had received, or retained the money improperly. It is contended, that such a charge, at the time it is made, is peculiarly unjust, as there were then no borrowers of good credit to be met with; and that the executor neither . did nor could derive a profit from it.

There are no facts disclosed in the record,, which can throw light upon this subject. The bill is silent as to interest, and so in the answer, except that part of it where (speaking of the paper money which he had scaled,) he states the injury arising from considerable sums having been on hand, from time to time, lessening every day in their value, without benefit to him, and without an opportunity of paying it away. Thus the question stands upon the face of the accounts. It is true, that there is no general rule, which obliges an executor to pay interest. We find from the cases upon this subject, that it has been determined both ways; and upon principle, it will appear, that no general rule can be formed.

Each case must depend upon its own particular circumstances; in some cases the executor ought, and in others, he ought not to answer interest. In this we think he ought to be accountable for interest, on the money resting in his hands, from time to time. But for the reasons before stated, in considering- the first point, it would be too rigid, and injurious, to charge him with interest from the day of each receipt of money. The accounts ought to be closed at the end of each year, and interest allowed upon the different balances, up to the year 1782, when the whole transaction closed. But such interest, ought not to be carried to the account of the succeeding years, in order to deduct the same, from the payments made in such succeeding years. This though done in the common cases of debtors is too strict as to trustees.

As to the risk stated at the bar, or the dilficultj' of procuring borrowers, it is an objection which does not come from the executor, nor is it stated by him in his answer, but is ^mentioned in argument as a possible case. But if it were true, he might have applied to the Chancellor for his direction, as to lending it to individuals, or to the public, which would have made him safe; or he might have carried the money into that court. In this case there were children, whose fortunes were almost entirely pecuniary. It would therefore be unjust that the money should lie in the executors hands unproductive, so as to deprive the legatees of main-tainance, or oblige them to resort to the principal of their legacies.

If the executor does not settle his accounts every year, he ought at least to strike the balance at the end of every year, that he may see the estate of his accounts and of the funds in his hands. It is upon this principle, that we establish the rule before mentioned.

In stating this interest, the appellant ought to have credit for the £500, in 1773, which by the will was directed to be lent him without interest, and to be re-charged with it in 1778, when the loan was to cease.

The third objection is made on the score of commissions.

An executor, is certainly entitled to some compensation for his trouble, and that, by custom, is generally fixed at five per cent upon actual receipts. But it is objected, that the legacy left to him, is a bar of all further compensation. The rule, that a legacy given to an executor, defeats his claim to the undisposed residuum, is assimilated to the point under consideration. But that principle, seems to be much mistaken, in the application made of it. It is unnecessary for us to give an opinion upon that point, as in this case, there is no surplus; yet it may be observed, that if there were such a residuum, the legacy would be no bar, as there were several executors, to all of whom unequal legacies are given, and so this court decided, in the case of Shelton and Shelton. The present question therefore, like all others of this nature, depends, (as to the amount to be allowed,) upon the custom, and the intention of the testator. He clearly meant, to allow an adequate compensation. To one executor, he gives ^250, and lest that should be an insufficient rec-ompence for his trouble, he authorises the other executors to encrease it, if necessary. In the codicil, he gives the appellant (who is not named an executor in the will itself,) a legacy, as being his nephew, and to this, he would have been entitled, tho’ he had refused the office. It would seem, as if the testator did not at first mean to make him an executor, by his directing his executors, to lend him ;£500 with interest. So that it is *evident, he never intended the legacy as a compensation for his services, but merely as a bounty. The appellant therefore, ought to have credit, for five per cent commission on his receipts of each year, before the accounts are closed, in order to adjust the interest as before mentioned.

As to the 4th point, the court entertain some doubt, whether the ^,'500, ought to be charged to the defendant at all, or not?

In the exceptions, it is stated as a debt due from the appellant, to the testator, and paid in 1778, — in his account, he gives credit in October 1777, for this sum, as due in 1778, and reduces it by the scale of October 1777. He is charged with it by the commissioners, in 1778, as cash, had five years, without interest, and then due; in which case, he ought not to be charged with it, unless he received it in other money, than what came to his hands by collection, with the whole of which, he seems to be charged in the account. This fact therefore, must be ascertained in the Court of Chancery.

If it appear, that he is so charged, the credit in his account (as executor,) in October 1777, ought to be considered as a payment on that day, in paper, and reduced by the scale accordingly; for a debtor, by undertaking the office of an executor, cannot be prevented from exercising, in common with others, the right of paying in paper money a debt due to the testator. And as no better proof can be expected, the entry in his account, will be evidence of the time of payment, and from that time, he bound his securities, to be answerable for the proper application of the money.

The decree therefore must be reversed with costs, and the cause remanded to the High Court of Chancery for the enquiry to be made, and for an account to be taken, according to the principles of this decree.  