In re the Judicial Settlement of the Account of Gillroy

A trustee does not become liable to his beneficiaries merely because an adverse decision is rendered against -him in an action brought by him in the interest of the estate, but only when it is shown by competent evidence that he has suffered such defeat by his own fraud, collusion or gross negligence. 'The judgment in the Supreme Court action was obtained because the defendant in that action was believed by the referee in opposition to the oath of the trustee as to an alleged statement of an account. The judgment thus rendered is not binding as an estoppel between the trustee and his beneficiaries on an issue as to his good faith in his dealings as trustee, and the testimony given against him in that action is, for the purposes of the present proceeding, mere hearsay. The objection as to the $401 item is overruled.

Decreed accordingly.