executors should be undully harassed by being required to exhibit inventories after long lapses of time, the Court will discourage stale demands for inventories. Thus, in a case where the deceased had been dead eighteen years, an application for an inventory was refused.1 But it is always desirable and prudent for a personal representative to take an inventory of the assets which have come to him in that capacity. There have been cases in which the representatives of a deceased executor have been required to exhibit an inventory of the assets of the original testator, it being believed that they, although not representing the latter, had received some part of his estate.2

Obtaining a grant of probate or administration is one of the first duties of the person who is entitled to the grant, and who has dealt with the assets. A fine of £100, and 10 per cent. extra stamp duty, is the penalty provided by the 55 Geo. III. c. 184, s. 37, for delaying to do this for more than six months after the death, or more than two months after the decision of a suit respecting the will or grant, the suit not being ended four months after the death.

Getting in the Estate.—Having obtained the grant, the legal personal representative will proceed to get in the assets, entering, if necessary, upon the land of the heir to remove chattels, collecting or suing for debts, &c. In this business he must be diligent, for if by his unreasonable delay or negligence a debt or anything else be lost to the estate, he will be held liable to recoup the loss to the estate out of his own pocket.

It is a common mistake that the liabilities of trustees are to be borne by the person commonly called “ the acting executor." There is no more fruitful source of fraud and disappointment than this idea. The law knows no distinction between active trustees and dormant trustees. Indeed, a trustee goes far to condemn himself out of his own mouth when he tells the Court that he was asleep when he should have been awake. It is the duty of every trustee to watch his co-trustees and to protect

1 Scurrals v. Scurrals, 2 Cust.

2

Gale v. Luttrell, 2 Add. 234.

the trust estate, and if loss is suffered which vigilance and diligence would have prevented, the Court will compel even the dormant trustee to make it good. This liability is not thrown upon a mere agent of the trustees, as their solicitor, so long as he acts merely as the trustees' agent or until he throws off his character of agency. Thus, when a solicitor got the trust funds into his own hands, and enabled the executrix and life tenant to misappropriate them, the solicitor was charged as a constructive trustee.1

It is the duty of executors to get in all outstanding unsecured or insufficiently secured debts due to the testator, even though it should be necessary, to effect that purpose, that they should sue the debtor, who may even be one of the executors or relatives of the deceased. And for the same reason, the hazardous nature of the investment, executors ought not without express authority from the deceased, or from the decree of the Court in an administration suit, to carry on the business of the deceased. They should also convert all risky securities held by him, although if they honestly exercise their discretion, and refrain from selling (as when Mexican Bonds were left unsold for sixteen months in the hope that their price would increase), they may not be charged with any loss sustained by the delay.2 But although there is no invariable rule that they shall convert within twelve months, the burden is thrown upon them, if loss be sustained, of satisfying the Court that they had good reasons for delaying beyond that time. If, however, the testator has given the executors a discretion to convert, the burden falls upon those who seek to make the executors liable to prove misconduct on their part.3

An executor is not bound to throw good money after bad by suing a debtor when the action is not likely to lead to payment of the debt; and by a recent statute, he may "accept any composition, or any security, real or personal, for any debts due to

the deceased, and allow any time for payment of any such debt as he shall think fit, and also compromise, compound, or submit to arbitration all debts, accounts, claims, and things whatsoever relating to the estate of the deceased without being responsible for any loss to be occasioned thereby." The effect of this enactment is not to relieve executors from the duty of exercising an honest discretion and reasonable diligence.

They must do all things necessary for the safety of the trust property, as procuring registration where proper, giving notice of their equitable titles or titles by assignment to legal holders and debtors.1 It is the duty of executors to take the same care of the trust estate as a prudent man takes of his own estate. If they do so much they will not be held liable for loss which has happened notwithstanding. But for any failure in this regard they will be responsible, as when they leave money or securities unnecessarily or contrary to the order of the Court in the control of third persons, or deprive themselves of exclusive control of the property, as by paying money into an account at a bank with instructions to the bankers to honour only drafts which bear the signature of a stranger as well as of the trustees,2 for measures might be necessary to be taken to save the money on an instant when the signature of the stranger could not be obtained. An executor would also be held fully liable if in the failure of a bank he were discovered to have paid trust money, not to a separate account, but to his private account.3 The general principles which guide the Court in dealing with cases of this kind were enunciated by Lord Cottenham, in the case of Clough v. Bond. In delivering judgment his lordship declared the liability of an executor or administrator, when "a loss arises from the dishonesty or failure of anyone to whom the possession or part of the estate has been intrusted. Necessity, which includes the regular course of business in administering the property, will in equity exonerate the personal

representative. But if without such necessity he be instrumental in giving to the person failing possession of any part of the property he will be liable, although the person possessing it be a co-executor or co-administrator; i.e., an executor or administrator ought not to allow any part of the trust property to be within the sole control of one or more of his colleagues unless there be an actual necessity for it." On this ground, investment in securities which can only stand or do only stand in the name of one trustee, are highly objectionable,1 but, of course, if the testator possessed such securities, and bequeathed them specifically for life, the executors must preserve them in that state of investment.

Every trustee should take care not to mix the trust property with his own, for if the whole be lost he must replace the trust property; and if it be not lost, but he should be unable to show exactly how much belongs to the trust and how much to himself, the whole may be held to belong to the trust.2

Payment of Debts.-The legal personal representative will proceed to pay, out of the assets, the debts of the deceased, and this he will do according to their priorities. If the deceased should have died insolvent, the administration of the assets will be regulated by section 10 of the Judicature Act, 1875, upon which, however, a somewhat narrow construction has been put.3 By that section it is enacted, "that in the administration by the Court of the assets of any person who may die after the commencement of this Act, and whose estate may prove to be insufficient for the payment in full of his debts and liabilities, the same rules shall prevail and be observed, as to the respective rights of secured and unsecured creditors, and as to debts and liabilities provable, and as to the valuation of annuities and future and contingent liabilities, respectively, as may be in force for the time being under the Law of Bankruptcy with respect to the estates of persons adjudged bankrupt; and all persons

who in any such case would be entitled to prove for and receive dividends out of the estate of any such deceased person, may come in under the decree or order for the administration of such estate, and make such claims against the same as they may respectively be entitled to by virtue of this Act."

But ordinarily the debts are to be paid in the following order :(1.) Funeral expenses and the costs of administration. (2.) Crown debts of record or specialty.

(3.) Debts due by overseers of the poor for sums received by them as such, and moneys and property belonging to friendly societies, and held by officers of such societies. (4) Judgments of Courts of Record against the deceased. (5.) Enrolled recognisances and statutes merchant, staple, and in the nature of staple.

(6.) Specialty and simple contract debts.

(7.) Dilapidations for which the representatives of an incumbent are liable.1

The executor may not pay a debt of a lower degree before a debt of a higher degree, for if there should be a deficiency of assets, he would not be allowed to plead the payment of the former when sued by the creditor of higher degree. Conversely, if he be sued by a creditor of lower degree, he should plead the existence of unsatisfied debts of a higher degree; for if he does not, on being afterwards sued by the creditors of higher degree, he cannot deny that he had sufficient assets for the latter.

Debts due on account of credit given by the Commissioners of Stamps for the stamps on grants of probate and administration are to rank as Crown debts.2

The precedence of debts due by overseers of the poor and friendly society officers as such, is created by statute, 17 Geo. II. c. 38, s. 3, and 38 & 39 Vict. c. 60, s. 15.

The precedence given to judgments against the deceased only extends to those of a Court of Record of this country. Foreign judgments may be conclusive against the executor, but they give no priority of themselves to the debts upon which they are

Bryan v. Clay, 1 E. & B. 38.

2

55 Geo. III. c. 184, s. 45.