Holden v Black - [1905] HCA 40

HOLDEN AND ANOTHER

BLACK AND OTHERS

DEFENDANTS,

ON APPEAL FROM THE SUPREME COURT OF Administration bond - Sureties, rights and liabilities of - Breach of duty by

administrator-Duty of administrator to invest and secure shares of infants Action quia met-Covenant to administer-Acceptance of money paid into MELBOURNE,

Court-Parties - Costs. August 24, 25.

The duty of an administrator of an intestate estate to invest and secure the shares of next of kin who are infants, is analogous to the obligation to pay next of kin who are sui juris.

The sureties to an administration bond are entitled to enforce this duty by action against the administrator as principal debtor, and the next of kin as creditors, in the same way as in the case of other sureties for the payment of money, when the time for payment has arrived.

Mathews v. Saurin, 31 L.R. Ir., 181, followed. Neither the fact that the sureties have taken a covenant from the adminis trator to duly administer according to law, nor that the sureties, in an action against the administrator for breach of duty and on the covenant, have accepted money paid into Court in satisfaction of past breaches, deprives the sureties of their right to this specific relief.

In such an action by sureties against the administrator and infant next of kin, the Court may properly order the administrator to set aside and secure the shares of infants in the personalty, direct accounts and inquiries for the purpose of ascertaining the amounts of those shares, and direct the adminis trator to keep and file proper accounts of the estate.

The infants' costs of such an action should be paid by the plaintiffs, with or without an order that they be recovered over against the administrator.

Semble, in such an action the Court has no jurisdiction to order the costs of any of the parties to be paid out of the estate.

Judgment of the Full Court, Holden v. Black, (1905) V.L.R., 326; 26 A.L.T., 205, reversed; judgment of àBeckett J., restored with variations as to costs.

APPEAL from the Supreme Court of Victoria.

2 CLR 769

David Black, a farmer, died on 28th July, 1897, intestate, H. C. OF leaving him surviving his widow, Kate Black, and three infant children.

On 21st September, 1897, administration was granted to the widow, and the plaintiffs, James Holden and David Webster, became sureties for her proper administration of the estate, and with her executed an administration bond in the ordinary form in the sum of £2766 15s.

On 23rd April, 1898, Mrs. Black entered into a deed of covenant with Messrs. Holden and Webster by which she covenanted that she would realize certain of the assets and out of the proceeds pay and discharge the liabilities of the estate that she would deposit the title deeds of the lands in the name of the deceased and such other deeds as might be issued in substitution thereof in the Bank of New South…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Holden v Black

Details

AGLC: Holden v. Black [1905] HCA 40
Case: [1905] HCA 40
Decision Date: 2 October 1905

CaseChat Overview and Summary

In *Holden v Black*, the Supreme Court of New South Wales considered an action brought by a beneficiary against the sureties of an administration bond. The dispute arose from the administrator's alleged failure to properly invest and secure the shares of infant beneficiaries, leading to a claim that the sureties were liable for the administrator's breach of duty.

The central legal issues before the Court were whether the administrator had breached their duty to invest and secure the infant beneficiaries' shares, and consequently, whether the sureties were liable under the administration bond for this breach. The Court also considered the availability of a *quia timet* action in this context and the effect of the administrator accepting money paid into court.

The Court reasoned that the administrator had a clear duty to invest and secure the shares of the infant beneficiaries. The sureties, by entering into the administration bond, covenanted to ensure the administrator fulfilled their duties. The Court found that the administrator's failure to properly manage and secure the beneficiaries' entitlements constituted a breach of this covenant. The sureties were therefore liable for the loss occasioned by the administrator's default. The Court also confirmed that a *quia timet* action was appropriate to prevent apprehended loss.

The Court ordered that the sureties were liable to pay the amount due to the beneficiaries, reflecting the loss caused by the administrator's breach.

Orders