This is a suit in equity. The complainants are John L. Bacon and H.E.C. Baskerville, partners as Bacon & Baskerville; John Stewart, Robert Ould, Robert H. Maury, and Isaac H. Carrington, trustees for the benefit of the creditors of William H. Macfarland, deceased, by virtue of a deed dated Oct. 20, 1870; John W. Wright, sheriff of the city of Richmond, and, as such, administrator of said Macfarland, — all citizens of Virginia.
The defendants are George C. Rives, a citizen of Texas, in his own right and as administrator with the will annexed of George Rives, deceased; J. Henry Rives, a citizen of Virginia, executor of George Rives, deceased; and Alfred L. Rives, a citizen of Alabama, executor of William C. Rives, deceased.
The suit was commenced, on the 22d of July, 1875, in the Circuit Court of Albemarle County, Virginia, and was thence removed into the Circuit Court of the United States for the Western District of Virginia, upon the petition of George C. Rives, in which the defendant, Alfred L. Rives, executor of Williams C. Rives, united. In the latter court, a demurrer to the bill was interposed by George C. Rives, upon the ground that the suit was barred by the Statute of Limitations both of Texas and Virginia. The demurrer was sustained, and the bill dismissed. The complainants thereupon appealed.
The case made by the bill is, substantially, as follows: —
In the summer of the year 1863, Bacon & Baskerville, John Stewart, Robert H. Maury, William H. Macfarland, and William C. Rives, uncle of the defendant George C. Rives, sent $131,000 in "Confederate States treasury notes" — the currency, at that time, of Virginia, Louisiana, and Texas — to James H. Stevens, then in Monroe, La., with instructions to invest or expend the same in the purchase of cotton on plantations in Louisiana and Texas, to remain thereon until the civil war was ended. Of that sum Bacon & Baskerville owned $48,000, Stewart $48,000, Maury $10,000, Macfarland $5,000, and William C. Rives $20,000. Subsequently, however, Bacon & Baskerville became the owner of $80,000, and Stewart of $16,000, the interest of the other parties in the residue remaining the same as at the outset. The funds were
About the 3d of September, 1863, Stevens died in Louisiana, en route to Texas, without having invested any of the funds. Shortly thereafter the complainants were notified by his widow that she held the $131,000 subject to their order. The defendant, George C. Rives, wrote to the same effect to his cousin, Alfred L. Rives, son and executor of William C. Rives. Moved by the advice and solicitation of William C. Rives, as well as by the encouraging character of certain letters written by George C. Rives to Alfred L. Rives, and exhibited to complainants, and influenced especially by the declaration of the former in his letter, that if the money was turned over to him he would act for the parties under their instructions, and save it by investing it in city property in Austin, Texas, or in property which he represented would pay well, and could be readily sold at any time, the complainants made and appointed George C. Rives their agent in the room and stead of Stevens. They consequently ordered and directed the funds in the hands of Mrs. Stevens to be paid to him, and towards the close of the year 1863, or early in 1864, he received them as agent and for the benefit of the complainants, to be invested in conformity with specific instructions given by Bacon & Baskerville, the managers and business negotiators of the enterprise, with the concurrence of the joint owners of the funds, viz.: 1. To invest them in cotton on plantations in Texas, to remain thereon until the war ended, that being the first and chief object of the whole venture. 2. If that could not be done, then to invest them in ranch property, meaning lands in Texas with cattle and horses thereon. 3. If that could not be done, then to invest them in town lots in Austin.
Nothing was heard from George C. Rives upon the subject of the proposed investment until, in response to a letter from Bacon & Baskerville, under date of Jan. 27, 1865, he wrote, under date of April 5, following, that he had invested the funds in the transportation of cotton under articles of partnership to continue during the war, and that the business was
As soon as possible after learning the whereabouts of George C. Rives, the complainants instituted this suit, charging that his retention of the whole proceeds of the money intrusted to him, his silence for nearly ten years, and his failure to render any account, arose from an intention to defraud them out of it, or the proceeds of its investment.
The bill further shows that George Rives died in Virginia in 1874, possessed of a large estate, real and personal, in which, by his will, George C. Rives, his son, had a large interest, and that J. Henry Rives and Charles Edward Rives qualified as his executors. The complainants ask that the interest of George C. Rives in that estate, in whatever form, be attached in the hands of the executors to pay whatever may be shown to be due them. Attachments were served upon the executors, and levied upon that interest. It is also
The bill prays that the defendants be required to make, upon oath, full, true, and complete answers to all the allegations of the bill; and that George C. Rives be required to render a full and complete account of all his actings and doings as agent of complainants, and show what disposition or investment he made of the funds intrusted to him, and what were the proceeds of such investment; and if no investment was made according to instructions, nor any other investment of which complainants may choose to avail themselves, that he be required to pay the value of the funds intrusted to him as agent, with lawful interest thereon.
Without waiving a full answer under oath to the bill, the complainants ask that George C. Rives be required to answer the several special interrogatories embodied therein, the object of which is to obtain from him information as to whether he had received the $131,000 under an engagement, as agent, to invest it in the mode set out in the bill; whether he had so invested it or not, — if not, why not; if yes, in what kind of property he had invested, and what disposition had been made of it or of its proceeds; and whether, after the close of the war, he did not have in his possession property purchased, in whole or in part, with the proceeds of the investment; if so, of what did it consist, and what has been done with it.
There was also a prayer for such other and further relief as equity and justice required. Thus stood the suit when removed from the State court.
The remaining question to be considered relates to the defence of the Statute of Limitations presented by the demurrer to the bill. The contention of the defendant is that the cause of action, if any, existed as far back as the close of the late civil war; that in Virginia and Texas the running of limitation was suspended by statute, in the former from some time in April, 1861, until Jan. 1, 1869, and in the latter from some time in 1861 until March 30, 1870; that by the laws of Texas two years was the limitation to suits on oral, and four years to
In the view which the court takes of the case it is unnecessary now to determine whether reference must be had to the law of the State where the suit is pending, or to that of the State where the alleged contract was to be performed. We are not satisfied that the cause of action, as set out in the bill, was, at the commencement of the suit, barred by limitation as prescribed in either Texas or Virginia. The case, as now presented, discloses — not, perhaps, one of those technical trusts of which a court of equity has peculiar and exclusive jurisdiction, but yet — a trust, arising out of express agreement, under which the defendant, George C. Rives, received from the complainants certain funds, which he undertook to invest in particular kinds of property, in conformity with specific instructions given by those whom he represented. His duty, under the law, although the agreement did not in terms so declare, was, from time to time, as the circumstances required, to inform those whom he represented of his acts, and, upon completion of the trust, to render an account of all he had done in the premises; or, if he elected not to execute the trust, to surrender the property or its proceeds. He received the funds, as has been seen, in the latter part of the year 1863, or early in 1864. He undertook to invest them, if practicable, in cotton on plantations in Texas, to remain thereon until the civil war was concluded. Failing in that he was to invest in ranch property, or lands in Texas, with cattle and horses thereon; failing in the latter, he was to invest in town lots in Austin, in that State. He gave, so the bill avers, no information
Taking, then, the allegations of the bill to be true, as upon demurrer we must do, the existence of the trust is clearly established; it is still open, or not wholly executed; it has never been disclaimed by clear and unequivocal acts or words, brought to the notice or knowledge of the complainants or either of them; there has been no adverse holding of the original fund or of its proceeds; consequently, the possession by the defendant, George C. Rives, of the proceeds of the original fund, if invested at all, may be deemed the possession of those whom he undertook to represent. But it is suggested that while the agreement did not prescribe any period within which he was to make the investment, it was necessarily implied that it was to be performed within a reasonable time; consequently, it is argued, the statute would commence running after the lapse of such reasonable time, or from the moment when complainants were entitled to enforce an accounting. Phillips v. Holman, 26 Tex. 276. To this it may be replied that whether the trustee was derelict in duty in not making the investment within any particular period, depends upon the special facts of the case. Having regard to all the circumstances, particularly such as were connected with the disturbed condition of the country for many years after the war closed, we cannot, upon the case made by the bill, fix the date when the defendant
And such seems to be the doctrine of the Supreme Court of Texas, by the laws of which State, the defendants insist, this case is to be determined as to the question of limitation. White v. Leavitt, 20 Tex. 703; Grumbles v. Grumbles, 17 id. 472. In the first of these cases a recovery was sought by the plaintiff for the recovery of the value of certain goods consigned for sale to the defendants therein, and which had never been accounted for. The suit was not commenced until four years after the goods came to the hands of the consignees for sale. It was said by the court: "The proof shows that the goods were held and disposed of by White & Co. in trust for Leavitt, and there being no evidence that the trust was ever repudiated, the Statute of Limitations [two years] did not run upon the cause of action, as it has often been decided by this court."
It is also suggested that the bill concedes that the complainants were informed by defendant in the year 1865 that
As, therefore, it does not clearly or distinctly appear from the bill that the suit was barred by limitation, the demurrer should have been overruled. The facts, when fully developed, may present an altogether different case from that now disclosed. We can only consider the question of limitation in the light of the facts alleged in the bill.
Decree reversed, and cause remanded for further proceedings in conformity with this opinion.
This case was argued at the last term, before MR. JUSTICE BLATCHFORD came upon the bench, and he took no part in deciding it.