TRUSTS-CREDITORS' CLAIMS AGAINST THE TRUST PROPERTY-LIABILITY OF TRUSTEES IN REPRESENTATIVE CAPACITY

Authors

T. E. Norpell, University of Michigan Law School

Abstract

Suit upon two notes signed by appellees, "Trustees, trading as the Annie Reisch Investment Company, a Common Law Trust of Sangamon County, Illinois." The notes, due in four months after date of execution, were purchased by the plaintiff, appellant, from the payee bank's receiver nine years after their maturity. This action was begun by complaint and cognovit and judgment was entered against the makers individually and as trustees. The individual defendants filed motions to open judgment against them individually; and upon motion for a summary judgment filed by defendants, held, by section 20 of the Negotiable Instruments Law, defendant trustees, are exempted from personal liability, trustees being protected by the statutory words "or in a representative capacity." While there was no express authorization in the trust instrument for the defendants to execute judgment notes, yet the provisions of the instrument were broad enough to authorize such, so that section 20 of the N.I.L. was applicable. A trust estate can be held liable at law for its authorized contracts. Smith v. Reisch, 329 Ill. App. 45, 67 N.E. (2d) 304 (1946).

Recommended Citation

T. E. Norpell, TRUSTS-CREDITORS' CLAIMS AGAINST THE TRUST PROPERTY-LIABILITY OF TRUSTEES IN REPRESENTATIVE CAPACITY, 45 Mich. L. Rev. 644 (1947).
Available at: https://repository.law.umich.edu/mlr/vol45/iss5/19