Kehnast v. Daum et al. SURETIES—ADMINISTRATORS-SUMMONS. [Defiance Common Pleas Court, June 25, 1897.] KEHNAST V. DAUM, ET AL. 1. OBLIGATION OF SURETIES Under SecTIONS 6006 AND 6151, REVISED STATUTES. The sureties upon an original administration bond, under section 6006, Revised Statutes, and the sureties upon “an additional administration bond, to secure the further assets arising from the sale of the real estate," under section 6151, Revised Statutes, are equally bound for the performance by the administrator of his duty to administer according to law, and account for the proceeds of all the real estate of the deceased that may be sold for the payment of his debts, which shall at any time come to the possession of such administrator, or to the possession of any person for him; and to pay any balance of such proceeds remaining in his hands upon the settlement of his accounts, to such persons as the court or the law shall direct. 2. CONTRIBUTION BETWEEN SUCH SURETIES. Although their liability in that behalf arises upon a different instrument, yet the sureties on such original bond are, to that extent, co-sureties with the sureties on such additional bond; and where a surety on such additional bond has been compelled to answer for the administrator's breach of duty in that respect, he is entitled to have contribution from all of his said co-sureties on both of such bouds. 3. REMEDY IN EQUITY, AGAINST ALL. In such cases, where one or more of such co-sureties is insolvent, the proper remedy is in equity, against all of the other sureties on such bonds, to compel an accounting between all of such co-sureties, and contribution by the solvent ones, in due proportion. 4. JOINDER OF PRINCIPAL, AND RELIEF AGAINST HIM. In such an action, where the plaintiff seeks contribution for money paid by him, in satisfaction of a judgment against the administrator and himself and another surety on the additional bond, rendered in an action to which the sureties on the original bond were not parties, the administrator is a proper party defendant, and is rightfully joined with said co-sureties therein, to the end that multiplicity of actions be prevented, and the ultimate rights of each and all such sureties, as well against their common principal as between themselves, adjudicated and enforced by the decree and orders of the court, in the one action 5. How CHARACTER OF ACTION DETERMINED. Where the facts stated in the petition show the case to be one for such equitable relief, it will be held to be an action in equity, although the prayer is simply for a money judgment. 6. SERVICE IN ANOTHER COUNTY. In such case, where service of summons has been properly made on the principal and a surety on the additional bond, within the county in which said action is brought, summons is rightfully issued and served upon the sureties on the original bond, in another county in which they reside, although the defendants served within the county in which the action is brought, are alleged in the petition to be insolvent. And such summons, or the service thereof in such other county, will not be quashed on motion of the parties served therein. HUBBARD, j The plaintiff brings this action to obtain contribution from his alleged cosureties, on bonds of the defendant, Fred W. LeSeuer, as administrator of the estate of Thomas Dempsey, late of Henry county, Ohic, deceased. Service of summons, duly endorsed with the amount for which, with interest, judgment will be taken if the defendants fail to answer, has been had upon the defendants, Kiser and LeSuer, in this county; and service of like summons has been had upon the defendants, Daum and Meyer, in the said county of Henry, where they reside. These last named defendants, who appear for that purpose only, have moved to quash the service of summons so made upon them, for want of jurisdiction in the court, to issue summons to another county, in this action. And upon this motion the case has been heard and submitted to the court. Defiance Common Pleas Court. Two questions arise on this motion, which must be determined from the allegations of the petition, which must be taken as true, for the purposes of this motion, under the rule laid down in Drea v. Carrington, 32 Ō. S., 595, that: "Where the allegations of the petition upon its face make a case in which all of the defendants are rightfully joined, and service is made on one or more in the county where the suit is brought, and on the others in another county, the question of the jurisdiction of the court over the persons of the defendants served in such other county, must be raised by answer," etc. These questions are, First-Does the petition show upon its face that the defendants, Daum and Meyer; as well as Kiser, were co-sureties with the plaintiff, for the performance of the same duty by the defendant, LeSeuer? Second-If so, does it further appear upon the face of the petition that the defendants, Daum and Meyer, are rightfully joined as parties to this action, with both or either of the defendants who were served in this county? Or, in other words, can an action such as this be maintained against all of the co-sureties jointly, or can it be maintained against the principal and the co-sureties, jointly? Referring to the petition, therefore, we find that it alleges the appointment of the defendant, LeSeuer, as administrator of the estate of Thomas Dempsey, deceased, by the probate court of Henry county, Ohio; the giving of an administration bond by the said LeSuer, with the defendants, Dauni and Meyer, as sureties thereon, in the sum of $2,000, conditioned according to law for the faithful performance of his said trust and appointment, and the approval thereof by said probate court; the making of an order for the sale of real estate of the decedent, in proceedings duly had by said administrator, in said probate court, for that purpose, and in which the said LeSeuer was ordered to, and did give an additional bond in conformity to the provisions of section 6151, Revised Statutes, and conditioned as therein provided, in the sum of $16,000, with the plaintiff and the defendant, Kiser, as sureties thereon; the recovery of a judgment in this court in favor of Henry Rohrs, administrator de bonis non of the estate of Thomas Dempsey, deceased, against the said Fred W. LeSeuer and William A. Kehnast and John B. Kiser, upon said last mentioned bond, in the sum of $900, for moneys which came into the possession of the said LeSeuer, as such administrator of the estate of Thomas Dempsey, deceased, and which he failed to pay over to the said Rohrs. his successor in the administration of said estate, upon the order of the probate court, by which he was appointed; that the plaintiff, Kehnast, was compelled to, and did pay said judgment and the costs of said action, amounting to $932.03, except the sum of $200, which is alleged to have been paid thereon by the said LeSeuer; and that the said LeSeuer and the said Kiser are each residents of said county of Defiance and wholly insolvent. And, upon this state of facts, the plaintiff prays for a personal judgment against all of the defendants in this action, in the sum of $524.30, with interest thereon from Dec. 12, 1895. From the averments of the petition, we are fully satisfied that the first question must be answered in the affirmative, and that it appears upon the face of the petition that the defendants, Daum and Meyer, as well as the defendant, Kiser, were co-sureties with the plaintiff, and bound in common with him to answer for and make good the default of the defendant, LeSeuer, for which the judgment, that plaintiff alleges he has been compelled to pay, was rendered. There can be no doubt that this case is governed by the rule given in 4 Am& Eng. Enc. of Law, pages 4 and 5, as follows: "Sureties for the same principal and for the same engagement are entitled to contribution, although bound by different instruments and at different times." And as stated in Vol. 24 of the same work, page 813, as follows: "If sureties are bound for the debt or default of the same person in reference to the same transaction, they are liable to contribute to each other although they are bound by different instruments." Kehnast v. Daum et al. In this case, the original administration bond on which Daum and Meyer were sureties, was by law required to contain, and it is averred in the petition that it did in fact contain, among others, conditions making the said LeSeuer and his said sureties thereon, Daum and Meyer, liable to the amount therein named, for default of the said LeSeuer as such administrator, to administer according to law, all of the moneys, goods, chattels, rights and credits of said deceased, and he proceeds of all his real estate that may be sold for the payment of his debts, which shall at any time come to the possession of said administrator or to the possession of any other person for him, and to pay any balance remaining in his hands upon the settlements of his accounts, to such persons as the court appointing him or the law shall direct. The second bond, by its terms and conditions made the said LeSeuer and his said sureties thereon, Kehnast and Kiser, liable to the amount therein named, for default of the said LeSeuer as such administrator, to account for and pay over to the persons lawfully entitled thereto, all of the proceeds of the real estate of the decedent so ordered to be sold. While the first bond was the general administration bond, and contained obligations on the part of the makers thereof, which are not included in the second bond, and for which the makers of the second bond are not liable, their provisions, as to the proceeds of the sale of the decedent's real estate, which was sold under the said order of the probate court, are substantially identical. The second bond was not a new bond, in the sense of being intended to take the place of the first bond, as to the proceeds of the real estate. The language of section 6151, under the provisions of which it was ordered to be, and was given, describes the bond to be given thereunder, as "an additional administration bond, to secure the further assets arising from the sale of the real estate." The word "additional" as so used in this connection, imports ex vi termini that the bond to be given under the provisions of said section is to be in addition to, and not in substitution of the original bond to any extent. And this construction is rendered more evidently correct, from the fact that it is left wholly discretionary with the probate court to require the giving of such additional administration bond or not to require it; the language being that the court may also require such bond to be given, before such sale, if it shall aeem it necessary. That is, in effect, if the court shall be of the opinion that the original bond is not sufficient of itself, to secure the due accounting for and paying over of the moneys coming into the hands of the administrator from all sources, including "the further assets arising from the sale of the real estate." There is nothing to warrant any claim that the giving of the "additional administration bond" provided for by this section, pursuant to the order of the probate court in which the estate is being administered, satisfies the condition of the original bond, or releases the sureties thereon from their obligation that the administrator shall administer according to law, the proceeds of all the real estate of the decedent, which shall at any time come into the possession of said administrator, or to the possession of any other person for him, etc. We suppose, no one will attempt to claim that the person or persons entitled thereto, might not sue and recover upon either bond, at his or their own election, for any moneys received by the administrator from the sale of his de cedent's real estate, and which such administrator had not accounted for, and paid over to the person or persons entitled thereto. If Rohrs, the administrator de bonis non, was entitled to recover from the plaintiff and Kiser, he might, had he so elected, have recovered from Daum and Meyer. For the default, which would warrant a recovery against the parties to the second bond, would have been a default in the condition of the first bond. The second bond is not intended or required to be given for the benefit of the sureties on the original administration bond, but solely for the benefit of the estate of the decedent. The only benefit they can derive therefrom, is the incidental benefit of contribution from the sureties on the second bond, if they Defiance Common Pleas Court. are compelled to answer for a default of a condition of the original bond, whic!: is also a condition of the second bond. The second bond does not in any way enlarge or diminish the obligation of the first, or extend or limit or affect the performance of the conditions thereof; but the first bond simply remains in force, and the sureties remain liable thereon, in all respects, as if the second bond was not given or required to be given, except as to such right of contribution, from the sureties on the second bond. The sureties on the original administration bond thus remaining ïiable, and the sureties on the additional bond thus becoming liable for the performance of this duty of their common principal, they have a common obligation, although one arising upon different instruments, to answer for the default of their common principal, in the case of his failure to account for, and pay over to the person entitled thereto, the proceeds of the sale of his decedent's real estate. Having thus disposed of the first question arising upon this motion, in the affirmative, we come now to the second, and in order to determine this it becomes necessary to consider the nature of the rights and remedies between cosureties. The right of contribution was originally a creature of equity, and depended upon equitable principles wholly. It has been universally held by the courts of England, as well as those of this country, including those of our own state, that this right rests upon the principle, that where parties stand in equali jure, equity, which delights in equality, will decree that the discharge from a common obligation, which inures to the equal benefit of all shall be obtained at their equal expense. But, although having its origin in equity, this principle, like so many others, has been adopted by the law; and based upon it, the law raises an implied promise on the part of each co-surety, to pay his part of the loss resulting from a concurrent liability to pay a common debt. In Russell v. Failor, 1 O. S., 327, 330, the court by Bartley, C. J., say: "The right of contribution among sureties is founded not in the contract of suretyship, but is the result of a general principle of equity which equalizes burdens and benefits. The common law has adopted and given effect to this equitable principle on which a surety is entitled to contribution from his cosurety. This equitable obligation to contribute having been established, the law raises an implied assumpsit on the part of the co-surety, to pay his share of the loss resulting from a concurrent liability to pay a common debt. This jurisdiction, by an action at law, is, therefore, resorted to, when the case is not complicated; and the more extensive and efficient aid of a court of equity is thus rendered unnecessary." Also in Hartwell v. Smith, 15 O. S., 200, 203, 204. And by syllabus 2, in Camp v. Bostwick, 20 O. S., 337, it is held that: The right to contribution among co-sureties is not founded on the contract of suretyship, but is based on an equity arising from the relation of co-sureties." And by syllabus 5, in the same case: That "the right of action for contribution among co-sureties accrues when one has paid more than his proportion of their liability." And, in this case, on pages 346, 347, McIlvaine, J., says: "The doctrine of subrogation has its origin in the relation of principal and surety, whereby a surety who pays the debt of his principal is, in equity, substituted in the place of the creditor, and is entitled to all the rights which the creditor may have against the principal. But the doctrine of contribution has its origin in the relation of co-sureties or other joint promisors in the same degree of obligation. It is not founded upon the contract of suretyship. It is an equity which springs up at the time the relation of co-sureties is entered into, and ripens into a cause of action when one surety pays more than his proportion of the debt. From this relation the common law implies a promise to contribute in case of unequal payments by co-sureties. But equity resorts to no such fiction. It equalizes burdens and recognizes and enforces the reasonable expectations of co-sureties because it is just and right in good morals, and not because of any supposed promise between them. This equity having once arisen between co-sureties, this reasonable Kehnast v. Daum et al. expectation that each will bear his share of the burden is, as it were, a vested right in each, and remains for his protection until he is released from all his liability in excess of his ratable share of the burden. Neither the creditor, the principal, the statute of limitations, nor the death of a party can take it away." And in the case last cited, the right of contribution was enforced in equity, although the statute of limitations had long before barred an action at law. And, by syllabus 1, in Oldham v. Broom, 28 O. S., 41, it is held that: "The right of contribution among co-sureties is not founded in contract, and does not depend on the form of the instrument nor the position of the names of the obligors therein, but is the result of the general principles of equity, and depends on the actual relation they sustain to the instrument and to each other." And, in the same case, on page 48, Johnson, J., says: "The right of contribution among sureties is not founded in contract, but is the result of principles of equity on the ground of equality of burdens and benefits." "For this reason, where several parties by the same or by distinct instruments become sureties for the payment of a sum of money, and one pays more than his share, he may compel contribution from the others as co-sureties." "Courts of law took jurisdiction of action for contribution, on the ground that, as equity and good conscience demanded that as among co-sureties there should be equality of burdens, there was an implied assumpsit, which would support an action at law." There is a distinction, however, between the remedy at law based upon the implied assumpsit, and the remedy in equity based upon the equitable principle of equality solely, in this, as stated in the Am., & Eng. Enc. of Law, Vol. 24, pages 809-810, as follows: "If one of several sureties is obliged to pay the whole debt, he can enforce contribution from the other sureties so as to divide and equalize the loss. He can recover in equity a pro rata amount paid by taking into account the number of solvent sureties, but excluding the insolvent ones. In law he can only recover from each of his co-sureties the portion of the debt for which each is liable, taking into consideration the whole number of sureties, both solvent and insolvent." And in Vol. 4, of the same work, it is said in note 1, on page 2, that: "While contribution was originally only enforceable by courts of equity, subsequently jurisdiction was assumed by courts of law and relief administered on the ground of implied assumpsit. The jurisdiction of equity, however, to enforce contribution, remains unimpaired. And the remedy in equity is in many respects superior. In equity the rights of all the parties can be fully adjusted and protected." And a large number of cases are cited to sustain these propositions. In Chipman v. Merrill, 20 Cal., 135, the court, per Field, C. J., says: "In many cases, especially where the sureties were numerous, and some of them were insolvent, or where some of the sureties had died, courts of equity were alone adequate to afford complete remedy." In Parsons on Contracts, vol. 1, page 34, the rule above given is thus stated: "At law a surety can recover from his co-surety an aliquot part, calculated upon the whole number, without reference to the insolvency of others of the cosureties; but in equity it is otherwise." And to the same effect are Chitty on Contracts, 5th Am. Ed., 597-598. Story's Equity Jurisprudence, section 496. And many adjudicated cases. In Easterly v. Barber, 66 N. Y., 433, the court, by Miller, J., say: "It is claimed that an action at law by a surety for contribution, must be against each of the sureties separately for his proportion, and that no more can be recovered, even where one or more are insolvent. In the latter case, the action must be in equity against all the co-sureties for contributions, and upon proof of the insolvency of one or more of the sureties, the amount will be adjudged among the solvent parties in due proportion." |