6 Paige Ch. 213 | New York Court of Chancery | 1836
The master who has passed this account has entirely misapprehended the rule of law as to the allowance of commissions to executors and administrators, as well as the principle upon which such commissions should b,e computed; the result of which is that he has allowed the receivers, in addition to the per diem allowance claimed by them for their services in the execution of the trust, about ten per cent upon the whole amount of the fund which has been received and expended, or which is hereafter to be paid out by them. He was also wrong in allowing the $280,62 by way of commissions to the receivers for burning the bills of the bank. The $100 paid to the master was certainly a.sufficient compensation
The receiver was not entitled to charge for extra counsel fees to himself, in addition to the legal taxable costs in suits prosecuted or defended by him as attorney or solicit- or ; nor was he entitled to any allowance in the character of counsel for himself or his co-receiver, in relation to any other matter. The employment of counsel and the payment of a proper allowance for such services, when necessary, requires the exercise of a sound discretion on the part of the receivers or the trustee of the fund out of which such services are to be paid. It would, therefore, be as unsafe to allow a receiver or other trustee to contract with and pay himself for such extra services, as it would be to allow him to become the purchaser of the trust property which it is his duty to sell to the best advantage for the benefit of the estate. If he employs third persons as counsel, and where he has no interest in employing and paying them for services which are not absolutely necessary, there is comparatively little danger that the estate entrusted to his care will be charged with counsel fees which might safely have been dispensed with. No allowance for extra counsel fees to himself can therefore be made to a receiver, or other trustee, upon the settlement of his accounts.
Even if the master was right in computing the commissions upon each item of the receipts and disbursements of the receivers, he has allowed double what they were entitled to'; as he has allowed full commissions both upon the receipts and disbursements, whereas he should have allowed but half commissions upon each. The highest allowance under the statute, to executors' and administrators, in full for all their personal services, is five per cent for receiving and disbursing: that is, two and a half per cent for receiving, and two and a half per cent for disbursing the same money, or paying it over to those who are entitled to it under the trust, or upon the final settlement of their accounts.
The master, however, was wrong in allowing commissions upon each item, thereby increasing the allowance beyond the amount specified in the statute. Where an account is taken without annual rests, the commissions are to be computed upon the aggregate amount of the receipts and disbursements; so as to allow five per cent for receiving and disbursing the first thousand dollars, two and a half per cent upon the next four thousand, and one per cent for . the residue. In cases where the court directs annual rests to be made, for the purpose of charging the executor, or administrator, or guardian, with the interest upon the annual balances, the commissions are to be computed in the same manner upon the amount actually received and disbursed or paid over during each year, and in the same way upon the final balance ; in such a manner, however, that the whole amount of commissions shall in no case exceed five per cent upon the whole amount which may come to the executor, or other trustee. And where a receiver, or guardian, or committee, appointed by this court, renders a. periodical account of his trust, in the manner required by the
I am aware that, in the case under consideration, the allowance only of such commissions as are by law to be paid to executors and administrators will be an inadequate compensation to the receivers, for then* services in settling up the concerns of this very rotten institution, where the amount of the fund to be collected and paid out is so very disproportionate to the trouble of investigating its complicated concerns. But at the time the order for the passing of the accounts of the receiver was made, I was acting under the impression that the proceedings against this institution were commenced subsequently to the revised statutes, and that the court was therefore restricted by a statutory provision from allowing to the receivers any greater compensation for their services than the commissions allowed by law to executors and administrators. By the 76th section of the article of the revised statutes relative to the voluntary dissolution of corporations, the highest commissions which the court is authorized to allow are the commissions allowed bylaw to executors and administrators. (2 R. S. 470.) And this provision of the revised statutes is made applicable to receivers of insolvent corporations, or those which have forfeited their charters, by the forty-second section of the preceding article. (2 R. S. 464.) The allowance to such receivers, who have been appointed since the revised stabutes went into operation, cannot therefore exceed the com