In Re Estate of Nixon

163 S.E.2d 274 (1968)

2 N.C. App. 422

In the Matter of the ESTATE of Harvey NIXON, Deceased.

No. 68SC52.

Court of Appeals of North Carolina.

September 25, 1968.

*277 John R. Friday and W. H. Childs, Sr., Lincolnton, for petitioner appellees.

T. W. Bruton, Atty. Gen., Christine Y. Denson and Andrew A. Vanore, Jr., Staff Attys., Raleigh, for respondent appellant.

PARKER, Judge.

While the question has not been raised by either petitioners or respondent, in our view the clerk of superior court had no jurisdiction to hear or determine the matters presented by the petition and answer filed in this case. While the pleadings were entitled "In The Matter of The Estate of Harvey Nixon, Deceased," administration of that estate had long since been closed. The funds which were the *278 subject matter of this proceeding had been received by the clerk in 1958 from commissioners appointed in a partitioning proceeding to sell lands of tenants in common, and these funds had for a time been held by him as the separate property of certain of the tenants in common, the children of Elizabeth Nixon Edwards and of Margaret Nixon Edwards, whose exact identities and whereabouts were not then known. More than two years prior to the filing of the petition presently before us these funds had been voluntarily paid by the clerk into the Escheats Office of the University and after such payment the funds in question were no longer under the control or jurisdiction of the clerk. Therefore neither the probate jurisdiction vested by statute in the clerk of superior court nor the jurisdiction granted the clerk over special proceedings for partitioning of real property among tenants in common could any longer be invoked to support the clerk's jurisdiction in this matter. Under the circumstances the clerk had no power either to order the University to return the funds to him to be distributed among the petitioners, as petitioners requested, or to adjudicate that the University had the legal right to retain them, as prayed for by respondent. In our opinion the relief sought by the parties could only have been obtained in a civil action. However, when the matter did in fact come before the judge of the superior court, the judge had jurisdiction, G.S. § 1-276, and when the parties waived jury trial, the judge was fully empowered to hear and determine all aspects of the case. We therefore find it unnecessary to pass upon respondent's assignment of error directed to the judge's action in overruling its motion to dismiss the petitioners' appeal from the clerk on the grounds that notice of appeal had not been properly given.

Respondent's principal assignment of error is directed to the trial judge's entry of judgment holding that petitioners are entitled to the funds here in question. Respondent contends that these funds, having been derived from sale of real properties which belonged to Harvey Nixon at the time of his death in 1947, retained their character as realty and had escheated to the University under G.S. § 116-20 as of the date of Nixon's death. Real property escheats only when the owner dies intestate or dies testate without disposing of the same by will and without leaving surviving any heir, kindred or spouse to inherit under the laws of this State. Such a situation did not exist in the present case. Quite to the contrary, Harvey Nixon left numerous heirs, many of whom became parties to the partitioning proceeding brought in 1954 for sale of his real property. Attached to the judgment entered in that proceeding on 22 December 1958 was an exhibit containing 56 pages listing the Nixon heirs. The existence of only one known heir capable of succeeding to title to his property would have prevented an escheat.

Alternatively, respondent contends it became entitled to the funds here in question under the provisions of G.S. § 116-22 and G.S. § 116-23. Those sections deal with the disposition of unclaimed personal property and provide that in certain cases covered by the statute such unclaimed personal property shall be paid to the University and the University is authorized to bring suit to recover the same. While these sections have been amended in some respects in the years since Harvey Nixon's death, throughout the entire period following his death and to the present time these statutes have provided that the University might hold such unclaimed funds and personal property without liability for profit or interest thereon, but subject to any just claims by parties entitled thereto. In this case, the funds were paid to the clerk of superior court under the order of 22 December 1958 to be held by him for the account of certain named individuals. He did so hold them until 8 March 1966, when he paid the funds to the University. The present petitioners now appear and assert they are *279 the descendants and legal successors in interest to the named persons for whom the clerk originally held the funds. Respondent University has formally stipulated that such is the case. Petitioners have presented a just claim for the funds.

Nor is the present action barred by the three-year statute of limitations, G.S. § 1-52(2), as respondent contends. That section provides that the three-year statute of limitations shall apply to an action "upon a liability created by statute, other than a penalty or forfeiture, unless some other time is mentioned in the statute creating it." Respondent's contention is that this statute would have served to bar an action by petitioners against the clerk of the superior court, who held the funds in his possession for more than three years without an action being brought against him to recover the same, and that the action being thus barred against the clerk is also barred as against respondent University. This argument ignores the fact that the clerk's liability in this case was not created by statute but arose simply because he received certain funds under an order of court which directed he hold the same for the benefit of named individuals. The clerk remained liable to account for these funds to the persons entitled thereto so long as the funds remained in his possession, and no statute of limitations would apply to bar an action by the beneficiaries for whose account he held the funds until they had made demand upon him and he had refused to honor the same. Similarly, no statute of limitation now applies to bar an action against the University by persons asserting a just claim for the funds until there has been a demand and refusal to pay. It should be noted that prior to 1947 G.S. § 116-22 and G.S. § 116-23 provided that if no claim was preferred within ten years after unclaimed property was received by the University, then such property was to be held by the University absolutely. This language was expressly stricken by Chapter 614 of the 1947 Session Laws. This Act evidenced a clear legislative intent, and we so hold, that lapse of time alone, absent a demand and refusal to pay, will not forfeit a just claim to recover property theretofore paid to the University under our statutes relating to the disposition of unclaimed property. In view of this holding, we find respondent's remaining assignments of error to be without merit.

The judgment appealed from is

Affirmed.

MALLARD, C. J., and BROCK, J., concur.