
    In the Matter of the Estate of Mary A. H. Campbell, Deceased.
    (Surrogate’s Court, Niagara County,
    July, 1897.)
    1. Accounting of executors — Statute of Limitations.
    Where a legatee is given by a will a life interest in a residuary estate, consisting of a note made by one of the executors, and they fail to realize upon it or to invest its proceeds in permanent securities for her benefit and do not transfer it to her in satisfaction of her legacy, there can be no final accounting of the proceedings of the executors until the death of the legatee, and the Statute of Limitations is not a bar to her demand for an intermediate accounting by the executors based upon their failure to pay her the interest of the sum represented by the note.
    2. Same — Payment by executor.
    The rule that a proceeding by a legatee to compel executors to account must be commenced within six years from the expiration of one • year after the granting of letters testamentary is subject to the exception that the running of the Statute of Limitations, may be intercepted by the- acts of the exécutors; and where an executor has, within six years, made payments to a .legatee upon his own note to the interest of which she is entitled for life and the note has never been assigned to her in satisfaction of her legacy but has merely remained in her possession as a bailee for the executors, the' Statute of Limitations cannot be successfully interposed by them as a defense to her application for an intermediate accounting.
    This is á proceeding instituted by Alice B. Smith (formerly Alice B. Campbell) to compel an accounting’ by the executors of the last will and testament of Mary A. H. Campbell, deceased.
    King, Leggett & Brown, for petitioner.
    Augustus Morris, for executors.
   Hickey, S.

' Mary A. H. Campbell died on or about the 'Tth day of July, 1884, leaving a last will and testament, which was admitted to probate in"this court on or about the 5th day of March, 188.5, and letters testamentary issued to- Leverett A. Campbell and Merrick Campbell, the executors therein named. The petitioner and executors are children of testatrix. An appraisal of the personal property of testatrix was made, on or about the 16th day of March, 1885. The inventory thereof1 returned to this' court, while properly signed by the appraisers, does not appear to have been signed or sworn to by either of the executors. There is no dispute, however, but that the so-called inventory contains a correct statement of the personal estate of testatrix. Hone of the property came into the hands of the executor, Merrick Campbell, and except that he. was present and assisted at a public sale of her effects, the proof is he took no part in the management of the estate.

The will of testatrix,"after making several specific bequests, provided as follows:

“And I further bequeath to the said Alice Bertha Campbell (the petitioner herein) the use of all I may- die possessed during the term of her natural life, the same to be equally divided among my remaining children or his or her legal heirs, after her death, share and share alike.”

According to the inventory the bulk of the personal estate consisted of a promissory note, dated April 1, 1880, for $2,258, made by Leverett A. Campbell (one of the executors herein), upon which there was due at the time of the appraisal the sum of $2,145.67.

No question is raised in this proceeding but that the. personalty other than this note was properly administered and the amount represented by it seems to have been understood and treated as the residuum of which petitioner was to- enjoy a life use.

At the time of the death of testatrix petitioner was living with her and continued to reside at the same place for years afterwards. The note does not appear to have been taken from the house by the executors, or either of them. It was produced for appraisal by the executor, Leverett A. Campbell, and he testified that it was left there with petitioner and her sister. It was not indorsed by the executors, or either of them, and assuming that it was left in the possession of petitioner alone which, however, is not quite clear, nothing seems to have been said in respect to the capacity in which she should hold it. It may be said to have remained in her actual possession from. her mother’s death down to' the present time. Leverett A. Campbell testified that he had access to it at all times and that he made two payments of interest thereon, as follows: April 1, 1885, $121.29; April 1, 1886, $121.74. He further says that he indorsed these payments on the note with his own hand. The money thus indorsed upon the note was paid to the petitioner. Since this, three other payments of money have been made to petitioner by the maker of the note and indorsed thereon by her, aggregating $90, the last of which, amounting to $50, was made in June,- 1895. Petitioner contends that these payments were made the same as the other two and were to apply upon the life legacy which she was to receive under her mother’s will. The executor, Leverett A. Campbell, however, contends that the last three payments were not made upon the note or to apply upon petitioner’s life legacy, but were made to her upon other transactions between them entirely disconnected with the estate.

Having, without success, made frequent demands upon the executor, Leverett A. Campbell, for the payment to her of what she understood to be her due under the provisions of her mother’s will, petitioner instituted these proceedings. The executor, Leverett A. Campbell, has interposed the Statute of Limitations as his defense, claiming, as stated above, that no- payments have been made upon the note or to petitioner to apply upon her life legacy within the last six years, and that, therefore, the note itself is outlawed and the statute has run against petitioner’s right to an .accounting.' In this connection it may be remarked that he testified that he wanted the note to outlaw, but that if it had been the note of anyone else he would have enforced collection. The executor, Merrick Campbell, has interposed the same and the further defense that he did not make or join in the making of any inventory of the estate; that no part, thereof has come into his hands and that he has taken no part in the management thereof.

It is well-settled law that, under a testamentary provision, such as is quoted above, it was the duty of the executors herein to secure to petitioner the use and enjoyment of the residuum of this estate during, her natural life and at the same time to' preserve the corpus thereof for distribution among the remaindermen after her death. This they might have done by realizing on the note and investing the proceeds in permanent securities, paying the income therefrom annually to the life legatee, or by turning over to her the residuiun of the estate and taking from her such security as would insure its preservation for the remaindermen. Covenhoven v. Shuler, 2 Paige, 132; Matter of McDougall, 141 N. Y. 21.

It is manifest that, had the executors invested this residuum, the duty would have thereby devolved upon them of paying over to petitioner annually the income therefrom. It is quite clear,, therefore, that they could not render a final account of their proceedings until the death of the life legatee, and it would seem to follow that, whether they made any such annual payments or not, the Statute of Limitations would not. begin to run against the right' of petitioner or any of the remaindermen to an. intermediate accounting at any time dining the life of the former. Such at least is our view of the .law, although no authority has been cited in .which the defense of the Statute of Limitations has been interposed under like circumstances. While it may be that under such a state of facts the statute would begin to run against each annual payment from the time' it became due, we think it apparent, however, that it Could not be said to have run against any particular annual payment until the same had become due and remained unpaid for six years or upwards. Surely it could not be urged that the statute' had ran against payments not yet due and which might not become due for many years, depending upon the life of the petitioner.

Again, had the executors turned over to petitioner the note in question or the money which it represented with or without security from her, pursuant to an agreement or understanding that it was to be in satisfaction of her legacy, she probably would not be here urging her cause, as it would be safe to say she could not maintain it. Such rule, however, would not apply to the remaindermen. They could insist upon an accounting by the executors at any time when they felt that their interests were being sacrificed or neglected. Although the note was left in the possession of petitioner, the defense is not set up that it was turned over to her in satisfaction of her legacy, and although some such argument is advanced in the brief filed by the executors, yet the evidence will not warrant an inference that she held it otherwise than as their agent or bailee. Under these circumstances her possession must be held to be the' possession of the executors, and they, having failed no't only to secure to petitioner the enjoyment of the advantages bestowed by her mother’s will, but having also failed to take steps such as will insure the preservation of the estate to the remaindermen, must be required to render an account of their proceedings, to the end that the rights in question may be protected.

But should our view of the law, as given above, be untenable, ■ yet there is another reason why the proceeding should be maintained at least as to the executor, Leverett A. Campbell; for, after a careful consideration of the evidence, we have reached the conclusion that the payment by him of $50 in June, 1895, as well as all the other payments referred to, were intended as payments upon the note in question and to apply upon the life legacy of petitioner. Ho authority has been called to our attention holding that payments by an executor to a legatee within the six years preceding the commencement of proceedings to compel him to account renders the defense of the Statute of Limitations unavailable. We see no reason, however, why such a payment should not be held to intercept the running of the statute the same as payment in any other case. In other words, we hold that the general rule that a proceeding of this kind must be commenced within six years from the expiration of one year after the granting of letters testamentary, is subject to the exception that the running of the statute may be intercepted by the acts of the executor, and that payment by the executor, the same as payment upon a debt by an individual, would bring the case within, the exception. Or, to put it in a still 'different light, the running of the statute against a legatee’s right to an accounting may be intercepted by the acts of the executor the same as its running may be intercepted in respect to an overdue debt.

It follows, therefore, that payments having been made to petitioner within the last six years to apply upon her life legacy, the defense of the Statute of Limitations has not been made out and. the executors should be required to account.

As to the further defense set up by the executor, Merrick Campbell, we do not think it available here. It does not follow, however, that because he may be liable to rendér an account of his ■proceedings that he will also be liable to make good any waste which may have been committed by his coexecntor. The fact, however, that both these executors are remaindermen,' may have some bearing upon that question. We think the issue involved here is, whether or,not the executors should render an account of their proceedings. We have reached the conclusion that they should. And when they have done this the question will be presented as to what1 extent each is liable in case a shortage is found1 to exist, and will be passed upon at that time.

Let an order be entered requiring the executors to render an account of' their proceedings on or before December 12, 1897; ■ the costs of this proceeding to be adjusted upon such accounting.

Ordered accordingly.  