IN RE: BAXTER'S ESTATE.*

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District Court of Appeal, Fourth District, California.

IN RE: BAXTER'S ESTATE.* RICHARDSON et al. v. ROYAL INDEMNITY CO.

Civ. 2340

Decided: June 20, 1939

Wade Garfield and F.L. Richardson, both of San Diego, for appellants. Gray, Cary, Ames & Driscoll and Burton D. Wood, all of San Diego, for respondent.

This is an appeal from an order settling the final account of a deceased administrator in this estate.

On April 18, 1919, one Charles T. Chandler was appointed guardian of the estate of Anna Baxter, an incompetent person. She died on March 2, 1922, and on May 8, 1922, Chandler was appointed administrator of her estate. On June 5, 1922, he filed his third and final account as guardian, which was approved on June 16, 1922. Shortly thereafter he filed in the guardianship proceeding a receipt as administrator from himself as guardian, acknowledging receipt of $31,295.25 “in money, property and securities belonging to said estate, the same being all of the property of said estate” and also filed in the probate estate an inventory listing cash and other assets in a similar amount, with some added interest.

On May 11, 1925, Chandler filed his first and final account and petition for discharge as administrator. Upon stipulation, the hearing of this was stricken from the calendar. On July 3, 1925, he filed an application for a reduction of his bond as administrator alleging that the estate had all been distributed except $1,278.03 but that the same could not be closed until an ancillary estate in Iowa had been settled. The court found the material facts and reduced the bond from $30,000 to $2,000. Chandler died in September, 1935, no further proceedings having been taken in this estate.

In June, 1937, F.L. Richardson was appointed administrator of the estate of Anna Baxter, deceased, and in September, 1937, R.F. Smith was appointed administrator of the estate of Charles T. Chandler, deceased. In March, 1938, Smith, on behalf of the Chandler estate, filed an amended final account in the Baxter estate in which he alleged that Chandler, as administrator, had received from himself as guardian about $17,000 more than he had receipted for to the guardianship estate, and more than he had charged himself with in his final account filed on May 11, 1925. The surety on Chandler's bond as administrator filed objections to this amended account. After a hearing the court found that this portion of the money and property received by Chandler as administrator was of the total value as set forth in his final account as guardian, and in his inventory as administrator. It was further found that after deducting credits to which he was entitled, Chandler was chargeable with $623.83. From the order entered approving the account this appeal was taken.

It is not contended that Chandler, as administrator, received anything after the close of the guardianship proceeding for which he has not accounted. The sole contention is that in his final account as guardian he did not set forth the full amount of property in his hands as such guardian. The point here made by the appellants is that the court erred in refusing to receive in evidence the first and second accounts and two inventories which had been filed by Chandler in the guardianship proceeding. It is argued that these instruments would have shown that the final account filed by Chandler in the guardianship proceeding failed to set forth and include certain securities which were then in his hands as such guardian. The respondent contends that the order approving Chandler's final account as guardian is res judicata and may not be thus collaterally attacked. The appellants argue that they are not attacking that account and the order approving the same, but are only seeking to interpret their real meaning. In support of this they argue that the said final account only purported to cover the cash which had been received by the guardian, without mentioning certain securities in his hands, and that the order approving said final account went no farther.

In his final account as guardian Chandler set forth that upon the approval of his second annual account “there remained in his hands, as shown thereby, money and funds belonging to said estate” in a certain amount, that since said time he had received from all sources certain other named amounts, and that his expenditures totaled a certain sum, leaving a balance of $31,295.25. The prayer was that his said account be approved and allowed and that he be ordered to turn over to himself, as administrator of the estate of Anna Baxter, deceased, “all money and other personal property in his hands belonging to said ward”. In its order approving that account the court, after stating that it had examined the account and heard evidence in support thereof, found that the same contained a true and correct statement of all sums which the guardian had received since his second annual account and contained “a true and correct statement of all funds and property in his hands belonging to said estate”. The account was approved and Chandler, as guardian, was ordered to deliver to himself, as administrator, all the property, money and funds in his hands belonging to the guardianship estate. A receipt was filed in the guardianship estate acknowledging the receipt by Chandler, as administrator, of the sum of $31,295.25 “in money, property and securities belonging to said estate, the same being all of the property of said estate as shown by the final account and report of said guardian herein”.

It is well settled that the final account of a guardian or of an executor, when settled and approved and which has not been directly attacked by appeal or otherwise, is res judicata and conclusive. Adams v. Martin, 3 Cal.2d 246, 44 P.2d 572; Ringwalt v. Bank of America etc., 3 Cal.2d 680, 45 P.2d 967; Carr v. Bank of America etc., 11 Cal.2d 366, 79 P.2d 1096, 116 A.L.R. 1282; Perna v. Bank of America, etc., 28 Cal.App.2d 372, 82 P.2d 605. The appellants rely upon the case of In re Estate of Clary, 203 Cal. 335, 264 P. 242, 244, in which it was pointed out that an order settling a final account is not conclusive as to matters not included in the account or necessarily involved therein. In that case the court held that where one of two coexecutors had died the acts of the deceased executor were not necessarily involved or approved in an order approving the acts of the surviving executor. It was there recognized, however, that “ ‘A final settlement is conclusive as to all matters, the proper subject of account, included in such a settlement or necessarily involved therein’ ”.

In the instant case, the amount of money or property with which the guardian was chargeable was not only a proper subject of account but was actually presented to and passed upon by the court in the final account of Chandler as guardian and the court's order approving the same. It was, therefore, conclusive in so far as the proceeding here in question was concerned. The case of In re Estate of Madsen, Cal.App., 87 P.2d 903, was similar in principle to the case now before us. In that case, as here, an attempt was made to attack the final order of a probate court in a subsequent probate proceeding. This may not be done.

Some contention is made that the court could not “legally approve” the final account filed by the deceased administrator, since it had not been brought on for hearing in his lifetime and since the administrator of his estate, in his behalf, had filed and presented a different account. The court passed upon the matter as raised and presented by the amended final account filed by the administrator of Chandler's estate as and for the account of Chandler in the original estate. The court, however, was not bound by the allegations contained in that account, but was under the duty of settling the account in accordance with the facts as found and with the law.

It is finally contended that the court erred in not finding that Chandler was chargeable with interest at 7 per cent on the entire amount of $623.83, compounded annually from November 11, 1925. The court did find that such interest should be allowed on $407.94 of this sum. Interest on this portion was allowed to compensate one of the heirs who had not participated in a partial distribution received by other heirs of Anna Baxter, deceased. It is argued that it is “apparent that this estate could have been settled” in 1925, and that compound interest on the remaining $215.89 should have been added. The bill of exceptions shows that the bond was reduced in 1925 for the reason that the estate could not then be closed. No other evidence is before us and it must be assumed that the court's finding that Chandler should not be charged with interest on the balance of the $623.83 was sustained by the evidence.

The order appealed from is affirmed.

BARNARD, Presiding Justice.

I concur: MARKS, J.