151 N.Y.S. 76 | N.Y. App. Div. | 1914
As we read the record, the learned surrogate felt constrained to revocation by the isolated fact that the executors had paid out of the estate funds for legal services rendered in the administration of the estate. The surrogate found that such payments were made for legal services necessarily rendered for the administration of the estate; there is no finding that the amount thereof was excessive, and his opinion indicates that when the payments were made there was in the treasury of the estate thrice the sum of such payments standing to the credit of the individuals personally who are the executors. As the revocation is avowedly upon the proposition that the executors “wasted the moneys of the estate in their hands and have improperly applied the same by taking them to their own use ” (Matter of Engel, 83 Misc. Rep. 675), the basis of such revocation must be subdivision 2 of section 2685 of the Code of Civil Procedure. (See, also, Code Civ. Proc. § 2569, subd. 2, as amd. by Laws of 1914, chap. 443.)
We are of opinion that these acts of the executors, when considered with the circumstances at the time of the decree, were not within the purview of the words of the said statute, “having wasted or improperly applied the money or other assets in his hands.” It is well settled that an executor cannot bind the estate by his executory contract made upon a new and independent consideration. The reasons for the rule need not be stated here. It is said by Culler, J., writing for the court in O’Brien v. Jackson (167 N. Y. 31, 33), that the reason is well stated by Hurt, Ch. J., in Ferrin v. Myrick (41 N. Y. 315). But as it is not the theory of the law that the executor personally should pay for services which are for the benefit of the estate, therefore any expenditure by him under such contract for this kind of service is regarded as his discharge of a personal obligation only until the expenditure
We can conceive that there could be either payment made ostensibly for legal services, or payment for legal services made in such amounts as on its face would indicate waste or improper application of estate moneys, or which taken into consideration with surrounding circumstances, might so indicate. But the case at bar is not within that category, for, as we have said, there is a finding that the services were necessary, there is no finding (and indeed no suggestion) that the amounts paid were excessive, and there was three times the amount in the estate treasury to the individual credit of the executors, applicable in the event of disallowance or of reduction upon judicial settlement.
We think that the words “wasted or improperly applied,” as employed in the statute, mean a “ squandering or misapplication” of funds of the estate whereby the estate is “lost” or “diminished in value.” (Ayers v. Lawrence, 59 N. Y. 192, 197.) And we think that the idea of “improperly applied ” is like unto that of “wasted.” Indeed, in the definition of “waste” just quoted from Allen, J., in Ayers v. Lawrence (supra), it is seen that he defines “waste” as "misapplication. ”
The action of the executors in this instance is aptly described in Shaffer v. Bacon (35 App. Div. 248; affd., 161 N. Y. 635), when the defendants were retained and rendered legal services: “But while theoretically the estates of deceased persons are administered upon the principle asserted in many cases of which those above cited are types, that the executor or administrator shall personally advance the necessary expense of administration in reliance upon the final decree of the sur
I note that section 2692 of the Code of Civil Procedure (as amd. by Laws of 1914, chap. 443), which is new, now specifically authorizes as proper procedure this custom, which the bar well knows has been constantly followed in the administration of estates without judicial interference or criticism whenever the payment has been but essentially premature.
We think that the decision in Matter of Engel (155 App. Div. 467) is neither precedent nor authority for the case at bar. In that case this court thought that it was not essential to
I advise that the decree be reversed and the matter be remitted to the Surrogate’s Court for procedure in accord with the opinion, but without costs.
Burr, Thomas, Stapleton and Rich, JJ., concurred.
Decree of the Surrogate’s Court of Kings county reversed and matter remitted to said court for procedure in accord with opinion, without costs.