[No. 14563. Department Two. May 6, 1918.]
B. L. GATES et at., as Executors etc., Appellants, v.
WILLIS B. HERR, as Executor etc., Respondent. «1»
PLEADING - EXHIBITS - DEMAND. A motion for an order requiring
defendants to furnish a copy of a written contract pleaded by
them, is a sufficient "demand in writing" as required by Rem.
Code, SS 284, and is "upon notice," within Id., SS 1262.
EXECUTORS AND ADMINISTRATORS - CONTRACTS - CONSIDERATION.
An executory agreement by an executor to buy from himself, in his
trust capacity, a half interest in certain property and apply the
proceeds to the payment of a legatee, who had no interest in the
property, is not enforcible as a claim against the executor, where
the contract was wholly unperformed through the refusal of the
court to order the sale, and the property was subsequently sold by
the successor of the executor, who never received any interest in
it; since there was no benefit to the promisor and no detriment to
the promisee.
SAME. An executor's conditional promise to pay a legacy if the
court would by its order legalize a sale by himself as executor to
himself, is not enforcible as an executor's promise to pay a
legacy from an estate possessed of sufficient assets, where the
court did not make the order.
CONTRACTS - CONSIDERATION - SEAL. The presumption of
consideration for a contract under seal is rebuttable.
Appeal from a judgment of the superior court for
King county, Frater, J., entered July 24, 1917, upon
findings in favor of the defendant, dismissing an
action on contract, tried to the court. Affirmed.
«1» Reported in 172 Pac. 912.
132 GATES v. HERR.
Opinion Per Curiam. 102 Wash.
T. B. McMartin and Griffin & Griffin, for appellants.
Herr, Bayley & Croson, for respondent.
PER CURIAM. - Albert J. Richards died on February
14, 1914, leaving an estate consisting of community and
separate property inventoried at $34,946. By the terms
of his will a bequest of $6,000 was to be paid to his
mother, Philena Richards, out of his separate estate.
William Holt, the partner of Richards in the business
of conducting the Grand Central hotel in Seattle, was
named as executor under the provisions of the will,
which was of the character known as a nonintervention
will, and letters testamentary were issued to him on
February 16, 1914. One month later the executor and
the legatee Philena Richards entered into the following
agreement:
"Memorandum of Agreement, made and entered into
this 16th day of March, 1914, by and between Philena
Richards, party of the first part, and William Holt,
party of the second part, both of Seattle, Washington.
"Witnesseth: Whereas on the 10th day of February,
1914, Albert J. Richards died at Seattle, Washington,
testate, leaving by his will a legacy of six thousand
dollars ($6,000) to the party of the first part to be paid
out of his separate estate; and
"Whereas a portion of the separate estate of said
Albert J. Richards, deceased, consists of an undivided
one-half interest in and to what is known as the Grand
Central hotel, located in the Latimer building, on the
corner of First avenue south and Main street, in the
city of Seattle, Washington, said hotel being up to the
time of the death of said Albert J. Richards owned
and conducted jointly by William Holt, party of the
second part, and said Albert J. Richards, deceased,
share and share alike; and
"Whereas, said William Holt as the executor and
surviving partner of said Albert J. Richards, deceased,
desires to wind up the affairs of said partnership and
to convert the interest of said Albert J. Richards,
GATES v. HERR. 133
May 1918 Opinion Per Curiam.
deceased, in said hotel into cash for the purpose of
raising funds with which to pay said legacy; and
"Whereas the parties hereto have had the said interest
appraised by disinterested appraisers who have
agreed that the reasonable value of such interest does
not exceed the sum of thirty-five hundred dollars
($3,500);
"Now therefore, in consideration of the premises,
and of one dollar ($1) in cash paid by the party of the
second part to the party of the first part, receipt
whereof is hereby acknowledged, the party of the first
part agrees that the party of the second part may purchase
said one-half interest in said hotel, together with
the furniture and fixtures therein contained, as surviving
partner, at and for the said sum of thirty-five
hundred dollars ($3,500) and the said party of the
second part agrees to purchase the same in order to wind
up the affairs of said partnership at said price on the
following terms, to-wit: The sum of one thousand dollars
($1,000) in cash on or before the first day of
April, 1914; the sum of five hundred dollars ($500) on
or before the first day of July, 1914; the sum of five
hundred dollars ($500) on or before the first day of
October, 1914; the sum of five hundred dollars ($500)
on or before the first day of January, 1915; the sum of
five hundred dollars ($500) on or before the first day
of March, 1915; the sum of five hundred dollars ($500)
on or before the first day of June, 1915.
"Said deferred payments to be evidenced by the
promissory notes of the party of the second part with
interest thereon at the rate of 6% per annum, payable
at maturity, and said deferred payments will be secured
by the party of the second part by a chattel
mortgage on said Grand Central hotel and the furniture
and fixtures thereof and a mortgage upon lots one
(1), two (2), three (3), and four (4:) of block two (2)
Seaside addition to Alki Point as per the recorded plat
thereof. And the party of the first part covenants and
agrees to accept from said party of the second part
said amount of thirty-five hundred dollars ($3,500) so
to be paid as aforesaid as a credit upon and in part
payment of said legacy of six thousand dollars ($6,000),
134 GATES v. HERR.
Opinion Per Curiam. 102 Wash.
and agrees and consents that an order of court
may be made and entered in this estate permitting and
allowing the sale of said half interest in said hotel to
the party of the second part at said valuation, which it
is agreed is a fair and reasonable one.
"In witness whereof, the said parties have hereunto
set their hands and seals the day and year first above
written. (Signed) Philena Richards (Seal)
"William Holt. (Seal)
"Witness; A. B. L. Dent.
"The party of the second part agrees to keep all of
the said personal property and the building upon the
lots herein described insured for not less than
twenty-five hundred dollars ($2,500) in a company or
companies satisfactory to the party of the first part; loss if
any to be paid to the party of the first part as her
interest may appear, to be applied to the payment or
partial payment of the notes in the order they shall
become due in the event of any loss or damage to the
property insured or any portion thereof.
"Wm. Holt."
No payments had been made under this contract by
the executor at the time of his death on November 17,
1915. After the death of the executor, Minnie Richards,
the widow of the testator, was appointed administratrix
de bonis non of her deceased husband's
estate, and thereafter sold her decedent's half interest
in the Grand Central hotel under order of the court.
Philena Richards died on November 30, 1915, and the
appellants B. L. Gates and Alfred R. T. Dent were appointed
executors under her last will. They instituted
this action against Willis B. Herr, as executor of the
estate of William Holt, to enforce payment for their
claim of $3,500, with interest, alleged to be due under
the foregoing agreement, which claim had been rejected
by the executor of Holt's estate. An affirmative defense
was interposed, setting up that it was understood
between William Holt and Philena Richards that a
GATES v. HERR. 135
May 1918 Opinion Per Curiam.
one-half interest in the hotel was the separate property
of Albert J. Richards, in which his wife had no
right, and that the agreement was entered into with a
view to securing the consent of Philena Richards to the
sale to Holt and a waiver of her right to appear and
object to an order of sale, and was for the purpose of
raising funds to apply on her legacy; that there was no
consideration for the agreement; that, on application
for an order of court authorizing the sale of Richard's
half interest, his widow objected to the jurisdiction of
the court on the ground that the will was nonintervention
in character, and further, that she claimed such
interest as community property and had notified Holt
not to apply any portion on account of the legacy; that,
since the death of Holt, Minnie Richards, as administratrix
de bonis non of the estate of her deceased husband,
has sold and disposed of the one-half interest in
the hotel and appropriated the money to her own use;
and that, owing to the dispute as to the character of
the property, such interest was never purchased by
Holt. The complaint alleged and the answer denied
that the one-half interest of Richards in the hotel
property was his separate estate.
The court found that the undivided half interest in
dispute had been sold by the administratrix de bonis
non under order of the court; that such half interest
never was the property of Philena Richards, deceased,
nor did she ever have the right to possess or dispose
of same; that Holt never received any consideration
for the agreement with Philena Richards; that he never
received the undivided one-half interest in the hotel;
that the estate of William Holt, deceased, has never
received any benefit or profit by reason of entering
into such stipulation; that Philena Richards or her
representatives have never been in a position to
transfer or convey to William Holt, or his estate, such
136 GATES v. HERR.
Opinion Per Curiam. 102 Wash.
undivided half interest, and that the provisions of the
written stipulation between Philena Richards and
William Holt have never been complied with. As a
conclusion of law, the court found the respondent was
entitled to a judgment dismissing the action. From
such judgment, this appeal is prosecuted.
The appellants assign as error an order of the court
requiring them to furnish respondent with a copy of a
written contract which had been pleaded by them according
to its legal effect. They contend that there
was no "demand in writing" as required by Rem.
Code, SS 284, that it was not "upon notice" as required
by Id., SS 1262, and that the motion therefor was not
accompanied by any showing of necessity made upon
affidavit. The motion itself was sufficient to satisfy
the requirement of notice and written demand. The
sufficiency of any showing of necessity was a matter
with the discretion of the trial court. We think this
assignment is without merit.
The issues presented by the pleadings are, was the
half interest of the deceased Richards in the Grand
Central hotel property community or separate estate,
and, if the latter, did the surviving partner, who was
also executor without the intervention of the court,
enter into a valid agreement binding upon himself
whereby title to such half interest passed from
Richards' estate to himself, thus rendering him
personally liable to Philena Richards.
The court did not expressly find that Richards' one
half interest in the hotel was either separate or
community property, although appellants requested a
finding that it was separate property. In view of the
conclusion we have reached upon the merits of the case,
the failure of the court to find as to the separate
character of the property was immaterial.
GATES v. HERR. 137
May 1918 Opinion Per Curiam.
The claim in behalf of the estate of Philena Richards
against the estate of William Holt is rounded on the
written agreement wherein Holt, as an individual,
undertakes to buy from himself, as an executor of Albert
J. Richards' estate, the one-half interest of such estate
in the Grand Central Hotel property and apply the
agreed price upon the legacy to Philena Richards.
This half interest had never been distributed to Philena
Richards. The will of Albert J. Richards bequeathed
to Philena Richards "the sum of six thousand dollars
($6,000) in cash to be paid out of my separate
estate." The bequest did not give Philena Richards
title to any specific property of the estate. It merely
gave her a contingent right to the sum of $6,000, or
whatever less sum should develop as pertaining to the
decedent's separate property on final distribution of
the estate. In making the agreement with Holt, Philena
Richards parted with nothing of value. The half
interest in the hotel was inventoried as separate
property in which she would have some interest under the
will, but her agreement to accept from the executor its
agreed valuation to be applied on her bequest would
not constitute a valuable consideration. Her agreement
to consent to an order of court for the contemplated
disposition of this property was nothing more
than a waiver of any right to object. The only party
really bound to do anything under the contract was
William Holt, thus constituting it a pseudo-unilateral
one. But in a sense he was not bound. The agreement
called for the sanction of an order of court, and this
was never obtained. The evidence does not show there
was any attempt of the parties to proceed with the
agreement after the refusal of the court to order the
sale. There is no evidence that Holt ever attempted to
assert title to his deceased partner's interest, and it
138 GATES v. HERR.
Opinion Per Curiam. 102 Wash.
must be presumed that the arrangement between the
parties was abandoned.
This action is maintained on the theory that the
agreement constituted a valid indebtedness on the part
of Holt enforcible as a claim against his estate. The
most favorable view possible is that the agreement was
an executory contract remaining unperformed. No
attempt was ever made to enforce the performance of
the agreement against either Holt or the executors of
his estate. The record shows merely a claim based
upon Holt's contract to buy from himself in his trust
capacity as executor and apply the proceeds of the sale
upon a bequest owing by his trust estate, if the court
would sanction it. We are satisfied that the appellants
have no valid claim against the respondent. The record
further shows that the hotel half interest which
was covered by the agreement upon which appellants
found their claim was subsequently sold by Holt's
successor in administering Richards' estate, by order
of the court under due process. Whether the property
thus disposed of was separate property of Richards
subject to the bequest in favor of his mother is not a
matter for determination here. Nor does there seem
to be any question of the rights and liabilities of a
surviving partner in the case, inasmuch as the surviving
partner, who was also the executor, made no attempt
to administer the partnership portion of the
estate in any other capacity than that provided by the
statutes governing the administration of decedents'
estates.
The appellants contend that their right of recovery
is supported by the rule which makes an executor personally
liable for the debts and legacies of the testator,
where the estate possessed assets sufficient and
the executor promised payment to the creditor or
legatee. If that rule were recognized as going to the
GATES v. HERR. 139
May 1918 Opinion Per Curiam.
extent of binding the executor personally on a promise
to pay a legacy instead of a debt, we have no such
promise in this case. The promise was merely conditional
that if the court would, by its order, legalize
the sale by himself as executor to himself as an individual,
he would pay the purchase price out of his
own funds as a pro tanto application on the legacy.
Although the generally accepted rule is that an executor
cannot purchase at his own sale, it may be conceded
that the present case might afford an exception
to the rule, since the transaction would have been for
the best interests of the estate in disposing of a
partnership interest at what the evidence shows was an
advantageous price, inasmuch as this interest on a
subsequent sale realized $2,000 less than this offer. But we
are confronted with the fact that the property in no
sense belonged to Philena Richards. Her interest in
the estate was for a cash legacy contingent on the
realization of that sum from the assets constituting the
separate estate of the decedent. Her right to such
legacy is still intact. Holt's agreement in his dual
capacity to buy and pay for the one-half interest in
the hotel would not form a contract with Philena Richards.
His promise to pay her therefor, if viewed from
the standpoint of contractual relations, was void, since
it was not hers to dispose of. While the acquisition
of the whole interest in the hotel might have been a
benefit to him, there was no element of detriment to
her. She was entitled to payment of the legacy and
it was the executor's duty to discharge the bequest.
The only element of consideration affecting her was
the benefit in expediting part payment of a legacy due
her. One of the rules relating to consideration is
stated in 9 Cyc. 316, as follows:
"There is no consideration for a promise where no
benefit is conferred upon the promisor nor detriment
140 FLOOD v. VON MARCARD.
Statement of Case. 102 Wash.
suffered by the promisee, and the promisor neither
undertakes to do anything which he is not bound to do
nor forbears to do anything which he has a right to
do. . . . The detriment to the promisee which suffices
as a consideration for a contract must be a detriment
on entering into the contract, not from the breach of
it."
It is plain the agreement shows a nudum pactum so
far as Philena Richards is concerned. Council contend,
however, that because the agreement was under
seal it imported a consideration. That is only prima
facie so, and the rule in such case is that want of
consideration may be shown as a matter of defense.
Considine v. Gallagher, 31 Wash. 669, 72 Pac. 96.
Finding no prejudicial error in the case, the judgment
is affirmed.