IN RE: BENNETT'S ESTATE.* (1938)

This is an appeal by the executor of the last will of Will Wallace Bennett, also known as W.W. Bennett, from an order and decree of settlement of account and final distribution. The will designated Inez V. Siemon, wife of appellant herein, and daughter of decedent, and Edna M. Allen, another daughter of decedent, as residuary legatees.

The appellant, as executor, during the course of administration but without any order of court, made payments to the residuary legatees of their distributive shares, overpaying each in the sum of $57.83. Appellant as executor also made payment of $110 over and above the sum allowed by court order for family allowance to the widow of decedent.

Objections to the allowance of these particular payments were interposed by respondent Mortgage Investment Company of Los Angeles, a corporation, which was a judgment creditor of the residuary legatee Edna M. Allen under and by virtue of a judgment obtained by respondent mortgage company against said residuary legatee in the Superior Court of Los Angeles County. Generally speaking, the grounds of the objections were that in due course, during the progress of administration, said creditor regularly obtained a writ of execution upon its judgment, caused a copy thereof to be duly served upon appellant executor, and, in accordance with section 561 of the Code of Civil Procedure, filed a copy of the same in the office of the clerk of the court in which said estate was being administered. Also, that ratable or partial distribution was made to such residuary legatee without compliance with sections 1000 and 1001 of the Probate Code, which sections authorize the payment of a distributee's share only after due notice given and when the court shall order such distribution, after a determination that the same can be made without loss to the creditors or injury to the estate or any person interested therein. With reference to the overpayment of family allowance, objection was based upon the claim that the same was beyond the amount authorized in the court's order.

At the conclusion of the hearing on the settlement of this account and petition for distribution, the court made findings to the effect that said residuary legatees were each overpaid $57.83 on their distributive shares; that such distributions in their entirety were made without any order of court, as provided by section 1001 of the Probate Code, and “were illegal and void”. The court further found that on September 15, 1931, judgment was entered against residuary legatee Edna M. Allen in favor of respondent Mortgage Investment Company in the sum of $5,628.52; that on or about September 26, 1934, a writ of execution was issued thereon, and the same was levied by the sheriff on the executor and appellant herein. The court also found that said writ of execution was served upon the clerk of the court in which administration of the estate was pending and was filed in said cause, in accordance with the provisions of section 561 of the Code of Civil Procedure. With reference to the family allowance, the court found that the executor had paid the sum of $110 over and above and beyond the sum allowed by the court in its order granting the family allowance. Based upon these findings, the court made and entered its order and decree of settlement, charging the account of said executor with the payments made to said residuary legatees and the overpayment made on account of the family allowance, and further directing that the executor pay to said residuary legatees the sum of $1,349.83 each, directing, however, in the case of the residuary legatee Edna M. Allen, that her share be paid by the executor to the Sheriff of Los Angeles County in accordance with law and subject to the rights of the parties.

It is urged on this appeal as grounds for reversal that said contested payments were properly made, should have been allowed, and that the refusal of the court to allow credit therefor was error, for the reason that in the case of residuary legatee Inez V. Siemon, no objection was made by any one interested therein to the advancement and that the receipt thereof was acknowledged by said legatee; that in the case of the legatee Edna M. Allen, the writ of execution was ineffectual because of failure to comply with the requirements of section 561 of the Code of Civil Procedure, while with reference to the overpayment on account of family allowance, that such payments were reasonable and actually required for the support and maintenance of the surviving wife.

With reference to the advancement made to the residuary legatee Edna M. Allen, the claims of appellant cannot be sustained. The duties of executors are to preserve the estate, pay the indebtedness of the deceased and the charges of administration, and put the estate in such condition that distribution may be had to those entitled to it. In the case at bar, however, the executor undertook to make payments of the funds of the estate upon his own judgment as to who were entitled thereto and as to the amounts thereof. This was clearly outside of his duty and was an attempt to entrench upon the exclusive jurisdiction of the court to determine these matters on distribution, and an infringement upon the rights of persons interested in the estate to have these matters disposed of solely on distribution—partial or final. The rights of devisees and legatees are fixed, not by the provisions of the will nor the judgment of the executor, but by the decree of distribution (Toland v. Earl, 129 Cal. 148, 61 P. 914, 79 Am.St.Rep. 100), and can only be determined on distribution. When an executor, like the appellant here, undertakes to determine without court order the amount due a residuary legatee and to pay the same, he does so at his peril and assumes the risk that such advancements upon his part may be disallowed when, as in the instant case, he ignores the plain provisions of the Probate Code, which had he followed, would have resulted in respondent's having notice of the hearing for ratable distribution and having its day in court to object thereto. Had appellant followed the course of procedure required by sections 1000 and 1001 of the Probate Code, thereby giving respondent notice of his intention to make a ratable distribution to the residuary legatee who was a judgment debtor of respondent, the latter would have had an opportunity to assert its claims against the distributive share of said residuary legatee, and if respondent had not done so and the court had made an order authorizing appellant executor to make the distribution in question, he would have been protected. There is ample evidence in the record to sustain the findings of the trial court that the payment made to the residuary legatee Edna M. Allen was illegal and void, and that the sum of $110 over and above the amount authorized for family allowance was paid without legal warrant. The evidence also fully sustains the findings of the trial court that both of said residuary legatees were overpaid in the sum of $57.83. That portion of the order and decree which concerns the residuary legatee Edna M. Allen and the overpayment on the family allowance must be sustained.

With reference to the payment made to the residuary legatee Inez Siemon, there are certain equities involved in this issue which require comment. It is conceded, and thoroughly established by the record in this case, that such residuary legatee was entitled to $1,349.83, while there is no showing that any person's rights were affected or injury sustained by or through the payment to said residuary legatee. Therefore the appellant executor should not be charged to account to the estate in full for this advancement as if he had diverted or misapplied the funds. If this advancement was made in good faith and at the solicitation of the beneficiary (and there is no evidence to the contrary), then the executor should be given credit therefor. Upon the hearing for distribution the court, in harmony with its general equitable powers, can adjust the matter between the legatees or distributees and the executor, and in conformity therewith should credit the latter with all advances made which the court finds were in proper amount, in accordance with the terms of the will, and without injury to the rights of any interested party. It necessarily follows, therefore, that the account of the executor herein should not have been charged with the full amount of $1,407.66 paid to the residuary legatee Inez V. Siemon, but only with the sum of $57.83, found to have been paid in excess of the amount to which said residuary legatee was lawfully entitled.

The court was correct in ordering and decreeing that the executor's account be charged with the full amount paid to the residuary legatee Edna M. Allen, and directing that appellant executor pay the amount of $1,349.83, to which said legatee was legally entitled, to the Sheriff of Los Angeles County subject to the rights of all parties interested therein. The executor's account was properly charged with the overpayment of $110 on account of the family allowance.

Though the appellant has not assigned any special error for the reversal of the order in so far as the residuary legatee Edna M. Allen or the overpayment on account of the family allowance is concerned, nevertheless the equities herein referred to, in the case of the residuary legatee Inez V. Siemon, impel a reversal so that all matters may be before the probate court for new proceedings consistent with the views herein expressed.

The order and decree appealed from is reversed.

WHITE, Justice.

We concur: YORK, P.J.; DORAN, J.