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In re Diskson

August 26, 1999

IN RE ESTATE OF HENRY J. DICKSON
OLD REPUBLIC SURETY COMPANY,
APPELLANT



Before Terry and Schwelb, Associate Judges, and Pryor, Senior Judge.

The opinion of the court was delivered by: Terry, Associate Judge

Appeal from the Superior Court of the District of Columbia (Hon. Kaye K. Christian, Trial Judge)

Argued June 16, 199

Appellant Old Republic Surety Company ("Old Republic") challenges the entry of a $1,000 judgment against it in favor of the estate of Henry Dickson. The award was based on a nominal bond which Old Republic had issued to Addie Anglin, the former personal representative of the estate, pursuant to D.C. Code § 20-502 (a) (1989). Like all nominal bonds issued under section 20-502 (a), this bond expressly provided that it was intended only to secure unsecured debts of the estate and to ensure the payment of inheritance taxes. By its terms, the bond was void once those debts and taxes were paid. When Ms. Anglin failed to account for nearly $100,000 of the estate assets, the trial court entered a judgment against her in the amount of the missing funds. The court also entered a judgment against Old Republic for $1,000, the amount of its bond. Old Republic argues on appeal that because the bond was a nominal bond, the court should have declared it void, since there were no outstanding unsecured debts and no inheritance taxes due to the District of Columbia. We agree and reverse.

I.

In December 1991 Addie Anglin and her father, Leon Shelton, filed a petition in the Superior Court seeking Ms. Anglin's appointment as the personal representative of the estate of the late Henry James Dickson. The petition alleged that Mr. Dickson had died intestate and listed twelve nieces and nephews, one of whom was Mr. Shelton, as his heirs at law and next of kin. Those relatives, the interested parties to the estate, waived the statutory requirement that Ms. Anglin post a general bond upon her appointment. D.C. Code § 20-502 (a) (1989). *fn1 Nevertheless, Ms. Anglin was required by statute to execute a nominal bond in an amount "which the Court consider[ed] sufficient to secure the payment of the debts which [were] not adequately secured and District of Columbia inheritance taxes payable with respect to property under the control of the personal representative." D.C. Code § 20-502 (a). Old Republic issued a nominal bond of $1,000 on behalf of Ms. Anglin on January 2, 1992. *fn2

In December 1993 the court removed Ms. Anglin as personal representative of the Dickson estate for failure to comply with the requirements for a First Accounting, and appointed Darrel Parker as the successor personal representative. On Mr. Parker's petition, the court admitted to probate what purported to be Mr. Dickson's Last Will and Testament. *fn3 Leon Shelton and Louise West were the principal legatees under the will. Ms. West was neither an heir at law nor next of kin and never executed a waiver of bond.

On October 14, 1997, Mr. Parker petitioned the court for an order to show cause why judgment should not be entered against the removed personal representative, Ms. Anglin, and her surety, Old Republic, for failure to account for estate assets. Following a hearing, the court granted judgment against Ms. Anglin in the amount of $98,904.41 and against Old Republic for $1,000, the amount of its bond. After its motion for reconsideration was denied, Old Republic appealed.

II.

Old Republic contends that the nominal bond it issued cannot be used to pay for losses caused by the malfeasance of the former personal representative, Ms. Anglin, because the bond was intended exclusively to secure the payment of unsecured debts and of District of Columbia inheritance taxes, and because the language of the bond expressly limits its application to those purposes. It argues that, because the estate had no outstanding unsecured debts and did not owe any District of Columbia inheritance taxes, the court should have declared the bond void. We agree.

At the time Old Republic issued its bond, section 20-502 (a) of the Code provided that when the bond requirement is waived by the decedent's will or by the interested parties, "a bond must nevertheless be given in an amount which the Court considers sufficient to secure the payment of the debts which are not adequately secured and the District of Columbia inheritance taxes payable with respect to property under the control of the personal representative" (emphasis added). It was under this provision that Ms. Anglin sought, and Old Republic issued, the bond in this case. The plain language of the statute convinces us that bonds issued under that subsection are intended only to ensure payment of unsecured debts and District of Columbia taxes and cannot be used for any other purpose. *fn4

This interpretation is supported by a 1995 amendment to section 20-502 (a) which removed from the statute the language we have quoted in the previous paragraph. Under the revised section, a personal representative need not obtain a bond when excused from doing so, either by the decedent's will or by waiver of all interested parties. See D.C. Code § 20-502 (a) (1997). Had the amendment been enacted sooner, Ms. Anglin would not have been required to obtain any kind of bond before being appointed personal representative. In that event, there would be no bond to protect unsecured creditors or the District's treasury, much less unknown interested parties like Ms. West. We interpret the 1995 amendment as simply removing the protection previously afforded to the District and to unsecured creditors by the issuance of a nominal bond; it did not otherwise alter the purpose of the statute. Unidentified interested parties such as Ms. West were never intended to be protected by nominal bonds.

Our Conclusion is supported by the Probate Rules of the Superior Court, which explicitly provide that a nominal bond is to be used only to secure unsecured debts and to pay District of Columbia inheritance taxes. See Super. Ct. Prob. R. 104 (a). *fn5 That rule directs that nominal bonds shall read, in pertinent part, as follows:

"The condition of the above obligation is such that if shall, as personal representative of the estate of , deceased, late of the District of Columbia, pay the debts due by the deceased, which are not adequately secured, and, if the decedent died prior to April 1, 1987, the District of Columbia inheritance taxes payable with respect to property under the control of the personal ...


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