
    BOUGHTON v. FLINT.
    
      N. Y. Court of Appeals ;
    
    October, 1878.
    [Reversing 12 Hun, 206.]
    Executors and Administrators. — Jurisdiction op Surrogate.— Disputed Claims. — Legacy to Creditor. — Auditor.— Review of Rulings of. — Objections to Executor’s Accounts. — Proof of Payments by Executors on Final Accounting.
    The surrogate has jurisdiction, on an accounting by an executor or administrator, to try and determine the validity of a claim made by him against the estate.
    
    If the claim is merely to á right of retainer out of the fund, it makes no difference that it is of an equitable rather than of a common law nature.
    A claim to the proceeds of securities collected is a cause of action of a legal nature, although the facts are such that but for the collection of the securities, the only remedy would have been in equity.
    Money kept by the husband at his wife’s request, — Held, a deposit, not a loan, and, therefore, the statute of limitations did not attach until after demand.
    
    
      A legacy by a husband to his wife in a will containing a direction to pay his debts, is not presumptively satisfaction of her claim for money deposited with him.
    
    Whether the rulings of an auditor are reviewable on appeal from the surrogate’s decree, — query.
    Such rulings are not so reviewable upon a mere exception noted in the minutes of testimony. There should be an exception filed on the ground of the objection, and determination of the surrogate had on it.
    The contestants’ objections presented to the surrogate before reference to an auditor, should put in issue the fact of payment, if that is to be questioned before the auditor.
    An objection filed to an account of an executor or administrator, that he had allowed more than was actually due to a creditor, does not avail to enable the contestants to object, for the first time, in the appellate court, that he had not actually paid the amount allowed. Hence, the auditor may exclude evidence on the question of payment, even by examination of the accounting party, unless the contestants obtain leave from the surrogate to amend or file further objections. The auditor does not decide as a court, but is employed simply to-aid the surrogate, and is subject to his directions.
    The accounting party is not bound to establish payments which he verifies by oath and produces vouchers for, unless they are denied by objections, and the burden of proof is then on the contestants.
    Appeal by defendant, Mary Flint, tbe executrix of David Flint, from a judgment of tbe general term of tbe supreme court, reversing a decree of tbe surrogate of Erie county.
    On tbe accounting before the surrogate, tbe executrix, tbe widow of tbe testator, presented a claim against tbe estate in ber own bebalf, amounting to $800, with interest from April 15, 1859, for moneys alledged to bave been placed in tbe bands of tbe testator, on deposit for ber. Sbe also claimed to be credited in ber account as executrix, witb tbe sum of $1,756.60, alleged to bave been paid by ber in full of a promissory .note of the testator, held, at the time of his death, Tby Mary Brown, her mother. These claims were allowed by the surrogate, after having been contested by John N. Boughton, the executor, and the other parties. The claim for the deposit of $800 was heard before the surrogate ; that for the payment to her mother was referred by the surrogate to an auditor, who reported in favor of the executrix, and his report was confirmed by the surrogate.
    From the decree of the surrogate an appeal was taken by the plaintiffs to the general term of the supreme court, which reversed the decree and remitted the proceedings to the surrogate.
    From this judgment of the general term, the defendant appealed to the court of appeals.
    
      Spencer Clinton and Jacob Stern, for appellants. .
    
      Thomas L. Cortell and L. P. Perkins, for respondent.
    
      
       Though not of one made by any other person, and rejected by the executor. Tucker v. Tucker, 4 Abb. Ct. App. Dec. 428. Where the claim was in judgment of a court of competent jurisdiction, the rule was applied, not to preclude the surrogate from allowing it, but to preclude him from trying the objections to the judgment, thus holding it conclusive on him. Stilwell v. Carpenter, 2 Abb. New Cas. 242, 269.
    
    
      
       This rule is embodied in the Code of Civ. Pro. § 410.
    
    
      
       As to extrinsic evidence on the question, — see Phillips v. McCoombs, 53 N. Y. 494, overruling in part, Williams v. Crary, 5 Cow. 368; 8 Id. 246; 4 Wend. 443; Hall v. Hill, 1 Dru. & War. 115.
      
    
   Rapallo, J.

The general term erred in holding that the surrogate had no jurisdiction to try and determine the disputed claims of the executrix against the estate. We have held in two recent cases that the statute, 2 R. S. 88, § 33, confers that power (Kyle v. Kyle, 67 N. Y. 400, 408; Shakespeare v. Markham, not reported).

On this question of jurisdiction the appellant makes the further point that the claim of the executrix for $800, held on deposit for her by the testator, was one cognizable only in equity, and that, conceding that a surrogate has jurisdiction to decide upon disputed claims of an executrix, such jurisdiction extends only to such claims as are enforceable- in courts of law, and not to such as require .the interposition of a court of equity, a surrogate having none of the powers of courts of chancery. ...

If the claim of the executrix were to equitable relief of any kind, there would be force in this objection, but where she claims only the right to retain out of the assets of the estate a sum of money as belonging or due to her, it can make little difference whether her right to it depends upon legal or equitable principles.

In the present case, however, we do not think that any difficulty of this kind arises. The sum which she claimed was the proceeds of certain notes and a bond and mortgage, which had been taken for the purchase money on a sale of real estate belonging to her. The bond and mortgage had been taken by the testator in his own name, but all the money secured by these different instruments had been collected by the testator in his life-time and he recognized the right of his wife to the fund, after it had been received by him; the evidence shows that he offered to pay it over to her and she requested him to keep it for her until she should call for it, to which it appears he assented.

On these facts, aside from the question of coverture, an indebtedness existed which could have been enforced at common law against the testator in an action for money had and received. Had the notes and mortgage at the time of the testator’s death remained uncollected and standing in the name of the testator, and the wife had sought to have them transferred into her individual name, the question suggested by the respondents’ point would have arisen, but as the case is now presented it does not arise.

In regard to this item of $800 the respondents further urge that it was barred by the statute of limitations. More than six years had elapsed from the time of the receipts of the money by the testator to the time of his death ; but there was no evidence that the money had even been demanded of him, or that he had refused to pay it over, or laid any claim to it hostile to that of his wife. We think that the transaction amounted to a simple deposit, upon which the statute would not begin to run until a demand and refusal to pay, or some equivalent act. The money was not loaned to the testator at his request, but was being kept by him for his wife at her request, and he was not in default in not paying it over until she should demand it, as he was requested to keep it until then (Payne v. Gardiner, 29 N. Y. 146, 167; Downes v. Phœnix Bank, 6 Hill, 297). For the same reason he was not chargeable with interest thereon without a special agreement.

The respondents further claim that the testator having in his will bequeathed to his wife the sum of $1,000, this bequest must be deemed to be in satisfac-. tion of the debt which he owed her. There is nothing in the case to justify any inference that such was the intention of the testator. On the' contrary, the terms of the will are that after the payment of all his debts he gives certain legacies out of the remainder of his estate, and among them a legacy of $1,000 and certain furniture and effects to his wife, and these bequests are to be received and accepted by her in lieu of dower. A legacy to a creditor is not to be deemed in satisfaction of his claim unless so intended by the testator (Williams v. Crary, 4 Wend. 444). A direction to pay all debts negatives such an intention (Port v. Gooding, 9 Barb. 371). The point now taken does not appear to have been taken before the surrogate, or at general term, unless it be in connection with the application to re-open the case to let in extrinsic proof on that subject ; such an application is to the discretion and favor of the surrogate, and not reviewable unless under very special circumstances, if at all.

It is further objected that by the decree the surrogate has allowed to the executrix, for the amount due on her claim — $800 and interest — the sum of $1,056.80. The claim of the executrix was for $800, with interest from 1859. There being no evidence of any agreement to pay' interest on this deposit, none was chargeable thereon, at all events during the life of the testator, in the absence of default on his part, and it is evident from the amount that such interest has not been allowed. The surrogate does not in his decree state how he arrives at the aggregate sum allowed, but on reference to the evidence, it is apparent that he intended to allow only the sums actually received by the testator for principal and interest on the notes and mortgage which he collected, and that he has not charged the testator or the estate with interest on these sums. The appellant’s land was sold in April, 1859, for $800 — no money was paid down, but three notes of $100, each payable at one, two and three years, and a mortgage for $500, payable in annual installments of $100 each, beginning the fourth year and running on to the ninth, were given, and the whole was on interest. The sum allowed by the surrogate is within a trifle of the sum to which these installments, with the interest, amounted. The mortgage was finally satisfied June 29, 1864. The debtors testify that the satisfaction-piece was given on the day the last payment was made ; that all the payments were made to the testator ; and and none of it went to the wife, to their knowledge. The estate was clearly chargeable with the interest as well as the principal received by the testator. If the surrogate has made any error in the computation it is very trifling, and his attention should have been called-to it.

All the objections taken to the $800 item have been disposed of.

The only other point in the case relates to an item of $1,756.60, charged by the executrix in her account for a payment to Mary Brown upon a note given her by the testator for $1,500 and interest for money lent by her to him. To this item the contestants filed an objection that the item of $1,500 and interest allowed to Mary Brown was incorrect, and should be $984 with interest from February 1, 1872, and that there had been paid to Mary Brown on the principal of her original, claim of $1,500 and interest, the sum of $516 and all the interest to February 1, 1872.

The account of the executrix thus objected to, was referred by the surrogate to an auditor for examination. The executrix, on the hearing before the auditor, produced the paid note which was made by the testator for $1,500, dated February 24, 1868, payable one year from date to Mary Brown, or bearer, with in-terest. Payments were indorsed thereon amounting in the aggregate to $516. The contestants' then introduced evidence for the purpose of proving that Mary Brown, who was the mother of the executrix, lived in the testator’s family from about the date of the note to the date of his death, which occurred January 20, 1872, and that it was agreed that the interest on this note should be paid by her board. This was controverted, and evidence was introduced on the part of the executrix for the purpose of showing that the board had been settled and paid. On this conflicting evidence the auditor reported that the whole amount of the note, with interest, less the payments indorsed, was due to Mary Brown by the testator at the time of Ms death, and that the charge in the accounts of the executrix on account of said note was correct. The contestants excepted to this report, but it was confirmed by the surrogate.

We see no reason for interfering with the findings of fact, but a point is specially made as to one of the rulings of the auditor on the hearing before him. The contestants, on the cross-examination of the executrix, asked her whether she had in fact paid to Mrs. Brown the amount charged in her account, also whether she had paid more than $984 with interest from February, 1872. These questions were excluded by the auditor.

Assuming for the moment .that rulings of an auditor are reviewable on appeal from a surrogate’s decree, it is quite clear that the questions must first be presented to the surrogate and his decision obtained thereon. In this cáse the question now raised does not appear to have been presented to or passed upon by the surrogate. The auditor’s report was excepted to, but the only grounds of exception specified were that he should have found that all the interest on the $1,500 note had been paid in addition to the payments indorsed, and that there was due on February 1, 1872, only $984. That he should have found that the item of $1,756.60 in the executrix’s account should have been $984 and interest from February 1,1872 ; and that he omitted to find that Mary Brown was indebted to the estate for her board, &c. There is no exception filed on the ground that the auditor refused to hear material testimony. The mere noting of an exception in the minutes of the testimony is not, I apprehend, the mode of bringing such questions before the surrogate. Exceptions should be filed to the auditor’s report (Dayton on Surrogates, 517 [3 Ed.]).

But, passing these considerations, it does not appear to us that there was any error in the ruling of the auditor. His duty was to pass upon the objections filed to the accounts, and no others. If others were to be introduced the contestants should have filed them before the surrogate, and obtained an order referring them to the auditor. The objections which were filed did not raise the question whether the executrix had paid the sum charged in her account. That payment was verified by her affidavit, corroborated by the production of the paid note as a voucher, on the face of which there was due .the sum charged in the account. The objection filed was that she had allowed the debt for more than was actually due ; not that she had not paid the sum allowed. It says, in substance, that the item allowed is incorrect and should be $984 with interest, because there had been paid to Mary Brown all the interest and $516 on account of prin - cipal. This objection does not put in issue the fact of payment by the executrix, nor her right to credit for the sum charged by her as paid, provided it was actually due to Mary Brown on the note. The accounting party is not bound to establish payments for which she presents vouchers unless they are denied by objections, and the burden of impeaching such payments is on the contestants. If the objections filed are insufficient, the surrogate may allow further objections to be filed from time to time, but this is not within the power of an auditor.

We think the proper course, if the contestants deemed the questions important, was to apply to the surrogate for leave to amend or add to the objections, or for direction to the auditor to take the proofs offered, and not by appeal to the supreme court to review the rulings of the auditor. The auditor does not decide as a court, but is employed simply to aid the surrogate, and is subject to his directions. The auditor’s report amounts to nothing until confirmed by the surrogate (2 R. S. 94, § 64). The decisions of the surrogate only are reviewable on appeal.

We think the evidence warranted the conclusions of the surrogate, and that there is no error in his decree.

The order of the general term should be reversed, and the decree of the surrogate affirmed. The appellant’s costs to be paid out of the estate.

All the judges concurred, except Miller and Earl, JJ., absent.  