In Re Estate of Colton (1912) · DecisionDepot

In Re Estate of Colton

Name: California Superior Court Tentative Rulings
Creator: DecisionDepot
License: https://creativecommons.org/licenses/by-nc/4.0/

California Supreme Court Sep 27, 1912 No. S.F. No. 6020.Published

Before: Henshaw

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Holding. The court held that a partial distribution of an estate is improper when it involves an indivisible claim currently in litigation, as such distribution causes significant embarrassment to the administration of the estate.

Issues

Whether a court may order partial distribution in violation of a binding written agreement between all interested parties.
Whether a court may order the partial distribution of an indivisible claim that is currently the subject of pending litigation.

Disposition. reversed

Quotations verified verbatim against the opinion

“claims in litigation should not be distributed unless with the full assent of- all the parties interested and under circumstances where it is apparent to the court that no embarrassment will result to the administrators”

Synopsis

The facts are stated in the opinion of the court.

Opinion — Henshaw

HENSHAW, J.

This is an appeal from a decree of partial distribution given under the following circumstances. Contest having arisen over the will of Ellen M. Colton, deceased, all of the parties in interest compounded their differences and entered into a written agreement which provided for the distribution of the estate “after paying the debts, if any, of the decedent, and the necessary costs of administration.” Application for partial distribution was made upon behalf of Helene M. B. Saeher, to whom, under the agreement was to be distributed one-fourth of the estate. At the time of her petition for partial distribution and at the time of the hearing thereof the necessary costs of administration of the estate had not been paid and the greater part of the estate consisted of a claim against the California Safe Deposit, and Trust Company appraised at three hundred thousand dollars for the enforcement of which the executors had brought suit, which suit was and still is pending and undetermined. The application was for the distribution to Helene M. B. Saeher of one-fourth of the claim against the California Safe Deposit and Trust Company. The court decreed distribution as prayed for and from its decree the executors and Caroline Colton Dahlgren, to whom, under the agreement was to be distributed one-half of the estate, appealed.

Upon the appeal two propositions are advanced: 1. That the decree is in violation of the written agreement of the parties, who by their agreement covenanted that such distribution should not be made until the necessary costs of administration had been paid, and that these costs, in fact, had not been paid; and 2. That in view of the condition of the assets of the estate it was error for the court to decree partial distribution. Upon both of these propositions appellants’ position- is well taken. Respondent relies upon the provisions of section 1661 of the Code of Civil Procedure and construes those provisions as a mandate upon the court to order distribution when the condi

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tions contemplated by the section are found to exist. Generally speaking, this is true, but it is quite within the powers of the parties (and here the parties were all the parties in interest) , or for a single party to estop himself by contract or conduct from insisting upon the enforcement of this rule.

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153 Cal. 77, [94 Pac. 230].) The written contract of these parties into which they advisedly entered was that distribution should be postponed until the necessary costs of administration had been paid. No attack is made upon this agreement; it is not sought to be avoided upon any legal or equitable grounds and it stands, therefore, as a binding covenant upon all the parties to it. We need not be at pains to consider the advantages to be derived by one or another of the parties by the enforcement of the agreement, whether either or any will sustain any financial detriment or advantage by its enforcement or nonenforcement. Suffice it, that the contract is one within the power of the parties to' make, one by the parties advisedly made, and it is binding upon the court in probate unless adequate cause be shown for setting aside its provisions. No such cause is shown. We have said that it is unnecessary to consider the advantages or disadvantages which might result to one or another of the parties to this agreement should the court see fit to enforce, or, as here, to disregard its terms. The contract was based upon a sufficient consideration, the mutual surrender of asserted legal rights, and this being the case, any party to it is entitled, to insist upon the fulfillment of its terms regardless of any question of financial gain or loss. Indeed, the real consideration may not be financial at all. Solely by way of illustration it may be said that a father or mother might enter into such a contract to delay distribution to the end of postponing the time when a wayward son might take his legacy in the belief that if the son took the property immediately he would squander it, and if possession was delayed a reformation might have intervened. This, as we say, is only to illustrate the innumerable reasons which might prompt the execution of such a contract as this, aside from reasons purely of financial gain, but whatever the reasons may have been, we repeat, no cause having been shown why the contract should not be observed, the parties to it were entitled to insist upon its terms.

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Synopsis

Opinion — Henshaw

HENSHAW, J.

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