Mr. Justice Sterrett
delivered the opinion of the court,
The mixed question of law and fact presented to the learned ■auditor and court below was whether the appellee was justly chargeable with such negligence in the management of the trust funds committed to his care as should cast upon him the burden ■of the loss that was sustained.
The investment which proved to be insecure, and from which the loss resulted, was made by Mr. Davis, the first guardian of tlie four minor children of John Jack, whose administratrix settled her ■account in April 1871. The distributive shares of the minors, amounting to $801.94 each, were paid to the guardian, who loaned three of the shares to Mrs. Ferguson on judgment bonds,, payable respectively as each minor came of age, with interest annually. About the same time he paid the remaining share to the eldest son who had then attained his majority. The account of Mr. Davis was settled and confirmed in March 1872, and on his own petition he was discharged on paying “to his successor all money in his hands, with accrued interest thereon, belonging to the estate of ■said minors;” and on the same day the appellee who was appointed his successor in the guardianship took from him, as cash, an assignment of the three judgments against Mrs. Ferguson. Two of the judgments which matured respectively in 1873 and 1876, with interest thereon as it accrued, were promptly paid and properly applied. The remaining judgment, representing the share of Miss Mary E. Jack, the appellant, matured April 1st 1877, to which date the interest was paid, and subsequently $1.44 was paid on account of the principal. Mrs. Ferguson then became embarrassed, and made an assignment for the benefit of creditors, but the fund realized from the sale of her real estate proved to be insufficient to pay prior liens; and the residue of the judgment held by appellee was thus lost.
The auditor found that the appellee, in the performance of his duty as guardian, acted in good faith, under the advice of counsel learned in the law, and was not guilty of negligence in the management of the trust; that at the time he accepted the assignment of the judgments, two of which were afterwards paid, the security was such as careful and prudent men would have regarded as good and sufficient, and that the loss which ensued was caused by the extraordinary and unexpected depreciation in real estate which followed the panic of 1873. It is not alleged by the appellant that there was any carelessness or mismanagement on the part of the guardian from which loss resulted, except in the single particular of accepting the judgment as cash from his predecessor in the trust; and the ground of complaint as to that is, that the judgment was not the first lien on the real estate.
In determining whether the act complained of was such as should render him liable for an unexpected loss resulting from an extraordinary shrinkage of values, especially of real estate in that neighborhood, all the facts and circumstances should be taken into consideration which seems to have been done by the auditor in this case. The investment was made by appellee’s predecessor with-special reference to appellant, payable when she came of age, with interest annually in the meantime, so that the fund might be constantly productive; and, notwithstanding the prior liens, the margin in the spring of 1872 was so much that the security was then regarded as safe and ample. Negligence cannot fairly be inferred from the fact that it ultimately proved to be insufficient. Many investments made about the same time by the most careful and prudent have resulted disastrously on account of the general depreciation of real estate during the years succeeding the panic. lithe appellee had refused to take the judgment, and had insisted on payment in cash, in all probability considerable time would have elapsed before he could have found a safe investment for the money, and then the complaint might have been that he had refused a safe and permament investment already made. The appellee was well acquainted with the property on which the judgment was a lien, and was competent to exercise a sound and reasonable discretion in regard to the sufficiency of the security. The auditor has found that in this, as well as in other respects, he acted in good faith and with ordinary care and prudence. It is, of course, a great hardship that the appellant should lose so large a portion of her small patrimony, but it would be a still greater hardship to compel her guardian to make good the loss unless it was occasioned by his carelessness. It has been said that the harshest demand that can be made in equity is to hold a trustee answerable for what was never in his hands, or for a loss not caused by his wilful default. In Eysters Appeal, 4 Harris 372, it is said : “ If guardians are to be held responsible for all negligence, and are not allowed the exercise of a reasonable discretion and prudential care in managing the property of their wards, it will deter prudent men from assuming the office, which, in itself, is sufficiently onerous, and already undertaken by such men with reluctance.”
While we regard the question in this case a close one and by no means free from doubt, we are of opinion that the conclusion reached by the auditor and the court below was correct, and that the decree should stand.
Decree affirmed, and appeal dismissed, at the costs of the appellant.