
    
      Job Palmer vs. The Legatees of Samuel Miller.
    
    A t.estatof’s executor marrie'd the widow of the deceased; to whom a life estate in a vaeá’ót lot had been devised, to' commence' at her eldest child’s coming of age. After marriage and beforé the life estate commenced, the executor erected buildings, out of his own funds — there being none of the estate — on the lot, and afterwards, as tenant per autre, mé, enjoyed the same for many years, till the wife’s death. The improvements being permanent, and at the time of erection likely to be beneficial, Held, that the executor ivas entitled to remuneration.
    He was entitled to the value of the improvements as they stood, when the estate left his hands, that being less than the amount expended, and it appearing that his profit out of the estate had not been as much as the interest on his money.
    Samuel'Miller, bj will, ordered that hi’s whole'estate sihould be kept together, for the joint use and maintenance of his wife and children, until his eldest child should come of age. Then, inter alia, he devised a certain vacant lot in Charle'ston, to his wife for life, remainder to his surviving children, or their issue. The testator died in the year 1789, leaving Job Palmer his executor: who, shortly after, married the te'stator’s widow, and out of his own funds, without any order of court, put buildings on the lot, and had possession till 1832, when his wife died. The residuary legatees then claimed the lot, but Palmer claimed, first, to be paid the value of his improvements.
    The case was heard in’ the first instance before the late Hon. Ch. DeSaussure, whose decree, based on the proposition that Palmer, the petitioner, was not entitled to remuneration, was reversed by the Appeal Court. The opinion of the court (by O’Neall, Ch., with the concurrence of Johnson and Harper, Ch.) so far as concerns the matter of the present appeal, was as follows:
    I agree fhat, generally, a tenant for life is not to be paid for improvements ; but to that rule there may be exceptions, as is the case, where a tenant for life goes on and finishes buildings left by the testator in an unfinished state. Hibben vs. Cook, (1 Cond. Rep. 281.) The reasons of that exception may be useful to us here; they certainly are twofold, first, that it is beneficial to the remainder; and, second, the implied intention of the testator, from the state of the property, its unfinished condition, that it should be finished out of his estate, in order to render it useful to both the tenants for life and the remaindermen. In the case before us, both of these reasons apply directly; it is alledged that the improvement was a beneficial one to all concerned, and it is manifest that the lot was most probably useless to the tenant for life, unless it was improved. We should, therefore, perhaps, (were it necessary to do so,) be authorized to presume, that the testator’s intention was, that the lot should be improved, as well for the use of the tenant for life, as of the remaindermen. But it is not necessary to resort to the doctrine between tenants for life and in remainder, in order to decide the question. For the house and other improvements were made in 1799, 6 years before the petitioner’s wife’s life estate commenced. He built as executor, and under the advice of the Ordinary.
    In Irmood vs. Twyne, (2d Eden, 152,) Lord Chancellor Northington stated the rule which always governs this court, in passing upon the acts of trustees. He said, “I conceive many cases where a conversion of such estate, (personal into real,) might be made by trustees, or guardians, and that this court would support and approve their conduct, and it would be strange to say that trustees would be censured in this court for doing what the court wouid have ordered to be done.”
    Under this rule, the question is, were the improvements such as the court would have authorized the executor to make 1 This would have depended on the fact, whether it would have been beneficial to all concerned, as devisees. On looking back to Mr. Miller’s will, I perceive that he has directed all his estate, real and personal, (after payment of his debts,) to be kept together, for the joint use and maintenance of his wife and children, until his son Job arrived at the age of 21 years. This, I think, constituted a strong reason for improvement of the lot. While vacant, it would be unpro.ductive capital; when improved, its rents and use might contribute to the purposes of the trust, for the widow and her children. But the fact that it might have been such an improvement as the court would have ordered, is a ground to retain and submit the question to the examination of the commissioner.
    In Myers vs. Myers, (2 McCord C. R. 267,) the defendant, an executor, was allowed for improvements on the trust estate, on the ground that it was for the benefit of his eestuique trust. The petitioner seems to me to be entitled to the benefit of the same rule. He made the improvements, as executor, and if they were such as were beneficial to the estate, and such as a prudent man, the owner of such an estate as Mr. Miller’s, would be willing to make, then the petitioner is entitled to compensation.
    But he is not entitled to more than the present value of the improvements, to be ascertained by the enhanced value which the said improvements have given to the lot. If the income from the house and lot, from its erection, (as the former decree allowed Mr. Palmer to retain the whole, without an account,) should, on the reference, appear to have been more than the interest on the sum of money expended by Mr. Palmer in making the improvement, and the costs of necessary repair, then such excess shall be deducted from the present value of the improvements.
    It is ordered and decreed, that Chancellor DeSaussure’s Recree be reversed, and that it be referred to the coinmis-sioner, to ascertain and report, whether the said improvements were beneficial to and proper for the estate, and if so; then the amount to which the petitioner is entitled, on ac> count of the said improvements, on the principles and according to the directions contained in this opinion.
    The Commissioner reported the cost of the improvements; with repairs, taxes and insurance, $6,686, 28; that they were of permanent value, and beneficial and proper for the estate; that interest estitnated on the money expended by the petitioner would exceed tlie income of the property, so that nothing was to be deducted from the amount to which the petitioner was entitled; that the lot and buildings were appraised at $3,500, and the lot if vacant, at $1200, and therefore, that the value of the improvements was $2,300.
    This report was brought up before Johnson, Ch.; who directed the commissioner to report, further, what were the available funds of the testator at the time the petitioner erected the buildings, and whether, at the time, there was a reasonable prospect that the improvements were beneficial to the estate, and would produce a fair interest.
    The Commissioner returned that there were no funds, and that there was a pro'spect that the buildings would produce a fair interest. And, further, that all the buildings were Consumed in the great fire of April 27, 1838.
    Upon this presentment of facts, the Hon. Ch. Harper made the following decree, in January, 1839.
    The decrees already made, and the reports of the commissioner, make a statement of the case. I have now to decide on the exceptions to the present report. The decree of the Court of Appeals, of 11th March, 1835, directed the commissioner to ascertain and report whether the improvements were beneficial to and proper for the estate, and the amount to which the petitioner was entitled, on account of these improvements. He reported that there was due to the petitioner the sum of $2,300. By the order of Chancellor Johnson, it was refeired back to the commissioner to report what were the available funds of the estate at the time, and whether there was at the time a reasonable prospect that the rents would equal the interest on the sum expended. He has reported that there were no available funds of the estate at the time, and that at the time there was a reasonable prospect that the rents would exceed the interest on the amount expended.
    The principal arguments in support of the exceptions, are, that it could not be prudent to run the estate in debt, by extensive improvements, when there were no available funds, and that the result has shown that they were not beneficial, inasmuch as the interest on the amount invested, according to the account reported by the commissioner, has far exceeded the amount of rents.
    According to the reasoning of the decrees, and the general doctrine on the subject, that the court will sanction such acts of a trustee, as it would clearly have authorized, if application had been made to it beforehand, it is necessary to carry the mind back, and consider the case as it would have been considered, if such application had in fact been made. Suppose then, that Mr. Palmer had in fact made application to the court, in 1799, stating that the lot was unproductive, that there were no available funds of the estate, but that he was Willing to advance the money out of his own funds. Suppose him to have shewn, (as there is no doubt he might have done,) that the rent would probably exceed the interest, and afford' a prospect of re-imbursing the expenditure; suppose him to have offered, if the rents should not amount to the interest, to lose the excess of interest, and at the end of the life estate, to receive only so much as the buildings, however dilapidated, should then add to the value of the lot. Is there any doubt, but that the offer would have been eagerly accepted, as most beneficial to the estate, as one by which it might gain much, but could lose nothing ? But these are the very terms which the court has imposed on him, and sanctioned his act upon such conditions. This would have been much more favorable to the estate, than, if he had funds lying at interest, to have withdrawn them, and vested them in improvements. There is no danger of .trustees being led to an abuse of their trust, if their acts are only sanctioned upon such conditions. The legatees are brought in debt, but they have value to the extent of their debt, and an estate from their ancestor to pay it.
    In point of fact, for several years after the improvements were made, the rents did exceed the interest. Down to 1800, I find that the petitioner had been re-imbursed about ¿£60 of the principal of his disbursements, beyond the interest. The subsequent fall of rents, I suppose, is to be attributed to the war, and the general decadence of Charleston in commercial prosperity. In 1803, it appears that the premises rented for ¿£98 19 2; in 1833, for ¿£25 16 9. The evidence is, that they were in good repair when delivered up to the remain-dermen, in 1834. But is a trustee who has acted faithfully, honestly and judiciously, to be made responsible for the fluctuations of public prosperity t
    
    With respect to the second exception, it is hardly necessary to say, that the rights of the parties are to be determined as they stood when their estate accrued, as they have in fact been decided by the decree of the Court of Appeals. It is their misfortune that their property has been consumed by fire, but a misfortune common to many others. It was in their own possession, and certainly it would be singular to make their former trustee liable for that loss.
    It is ordered and decreed, that both reports of the commis-missioner be confirmed, and that the respondents pay to the petitioner the sum of $2,300, reported by him, with interest from the 10th of July, 1835.
    The defendants appealed, on the following grounds ;
    
      
      First. That there was not evidence sufficient to warrant an executor to incur a debt against the residuary legatees, .without any authority from the court, upon the mere speculation that the cost of building would, in time, be extinguished by the rent; and more especially, as the rents were solely the right of the tenant for life, and only accrued to those in remainder, after the buildings became old ; at which time the remainder-men are to be compelled to pay in advance for (old buildings, upon the speculation that the rent must, in time, repay them.
    
      Second, Inasmuch as the improvements, pending this controversy, have been destroyed by fire, the remaindermen are pot bound to pay for buildings they never agreed to purchase, .and which are no longer in existence.
    
      Third. Because the evidence required the commissioner to .report, that the estate had no funds to invest, and that it was .altogether unauthorized in the executor, who was also husband of the tenant for life, to charge the remainder-men, at .some future and contingent period; if such can, at any time,
    be a prudent exercise of the authority of an executor.
   Gúria, per

Harper, Ch.,

There are some facts, connected with the proceedings in the cause which were not brought to (he view of the court below.

It appears that, after the filing of the petition of Complainant to be re-impursed the expenses of the buildings, a suit, for partition of the estate of Samuel Miller, was brought by Ann E. Thompson against the Complainant and the other defendants to the present suit. A writ of partition was ordered, and the commissioner recommended a sale of the real estate. In June, 1834-, a sale was made, and the house and lot in question was bid off by the present defendants, at the price of $3,450, who gave their bond to the master, with a mortgage of the premises, to secure the purchase money. In May, 1835, an order was made by Chancellor DeSaussure, that the proceeds of the sale of the house and lot then in the hands of tire master of this court, should remain with him subject to the future order of this court. Some years after the sale, the house, in'the possession of the defendants, was consumed by fire. The decree of the Appeal Court, of 1835, determined that the Complainant was entitled to be re-imburs-ed the expenses of the improvements, so far they added to the present value of the estate, and that decree is conclusive upon .the parties and upon the court.

The decree still seems to us to be stifficiently supported by authorities, and founded upon the plainest principles of equity. At that time, the defendants were suing at- law to •recover possession of the property. By resisting the Complainant’s demand, their claim was to put into their own pockets so much of the Complainant’s money, as the improvements added to the value of the lot; thus gaining an inequitable advantage against which the courts of law would afford no remedy. .

There are cases in which an executor would be allowed the entire amount of his expenditures in improvements, although, from some unforeseen cause, they should turn out to be of little or no value. As, in the case put, of his having money in his hands, and real estate entirely unproductive. If, to all human reason, they were judicious and advantageous to the estate at the time, there is no reason why he should bear the loss, although, from unforseen casuality, they should afterwards become deteriorated in value. But perhaps it is proper that, when the executor borrows or advances money for the purpose of making the improvements, and this has been done without the previous sanction of the court, the court should do what has been done in this case, and restrict his re-imbursements to the amount which the improvements added to the actual value of the property, at the time the Legatee is entitled to possession. Otherwise, the objection might be made, that the Legatees might be brought in debt beyond the value of the estate they receive. Yet this is but hard measure to a Trustee, who has acted judiciously and faithfully, where the devisee takes from his ancestor or testator, an estate which, altogether, is much more than sufficient to re-imburse him. But, when he is restricted to the actual value, it should seem impossible that the objection could apply. If the entire value of the property, and the relativé value of the land and of the ■ improvements, be truly fixed, there is nothing to do, but to sell the property and to divide the proceeds according to the rights of the parties.

It is urged that the estimate of witnesses is an imperfect method of fixing the valuation of property. It might be said, that if the evidence of value on one side is imperfect, it is the business of the other party to produce .the proper evidence. In some cases, however, it might be proper to bring the matter to the test of experiment, to direct a sale, and then to divide the proceeds according to the best .evidence of the relative value. The Court cannot do so nota, in this case. The property has been sold, and bid off by the defendants, at a price within a trifle of the value fixed by the witnesses. This strongly confirms the judgment of the witnesses. I must suppose that they bid so much more on account of the improvements. Is it not plain then, if they are allowed to keep the entire property and pay nothing, they put into their pockets so much money of the complainant, to which they have no shadow of a claim 1 But the house has been burnt down. But it was burnt after the entire property had become theirs, not only by the will of the testator, but by their own voluntary act. Men must bear their own misfortunes. If there was any neglect, in failing to insure, it was that of the defendants. It vvoidd be as reasonable, if they had purchased the property of another, to claim to be relieved, from the payment of their bond, on the ground that the property had been destroyed in their possession, as to claim a similar exemption in this case.

Hunt, for the motion.

The decree is affirmed.

Johnson, Dunkin and Johnston, Ch., concurred.  