21 N.Y.S. 209 | N.Y. Sup. Ct. | 1892
The principal questions in controversy on the appeal ■arise out of the decree of the county court on the accounting of the assignee, who failed to charge himself, in the account filed, with certain items of wool, and a buggy, embraced in the inventory filed by the assignee. The inventory price of this wool was $1,101.34, and the inventory price of the buggy was $70. The account, as filed, was objected to by the First National Bank of Amsterdam, a creditor of the assignor, having an interest in assigned estate, and the assignee’s account was surcharged by the bank with the amount of these items embraced in the inventory. The assignee, in his accounts filed, credited himself, and charged the assigned ■estate, with certain services, disbursements, and counsel fees paid for legal ■services of counsel employed by him and rendered by him and his law partner in various litigations in which he, as assignee, had been involved in the administration of his trust, which were objected to by the First National Bank of Amsterdam ; and a referee was appointed by the court to take and state the accounts of the assignee, and report to the county •court.
The case discloses that hearings were had and proofs taken before the •referee, upon which he made his report to the county court, with the
The rule has long been settled, both in England and this country, that while a trustee may, for necessary services, employ clerks, agents, and attorneys in the necessary management of the trust estate, he cannot perform such outside services, and be compensated for them out of the trust estate; and this rule seems to be founded upon a sound principle of public policy, of removing from the trustee all temptation for involving the trust estate in complication or controversy, with the purpose of increasing the trustee’s compensation. There is great force in the contention of the assignee that some of these services were rendered in successfully defending himself from a proceeding for his removal instituted and conducted by the bank as a creditor of the assigned estate, which it was the duty of the assignee to resist; and there is little doubt but that if these professional services had been rendered by an attorney employed by the assignee, and not by himself and partner, he could have paid them, out of the assigned estate, a reasonable compensation, which could have been credited to him on his accounts; and thesame mavbesaid of some of the other litigations in which he was involved in his efforts to marshal and to protect the assets of the assigned estate. But he cannot for that purpose employ himself, either as an individual or firm, and charge such services up against the estate. Such authority, if provided for in the assignment,
“They [commissions] are permitted in deference only to the analogies of the statute on the subject of executors, guardians, committees, and official assignees. * * * But, even in those cases, no assignee, even if he be a lawyer, is ever allowed his ‘ expenses, costs charged, and commissions, together with a reasonable counsel fee.’ ”
In Campbell v. Woodworth, 24 N. Y. 306, the court say:
“The compensation or commission which the law allows is for the labor, time, service, and attention of the assignee, actually done, spent, given, and bestowed in and about the business of the trust created. ” “It is for the performance of these services that the law has fixed a certain rate of compensation, which is denominated as ‘ commissions,’ and has adjudged that such rate of compensation is just and reasonable in all cases. ”
In Re Bank of Niagara, 6 Paige, 215, the chancellor uses this language:
“The employment of counsel, and payment of a proper allowance for such services. when necessary, requires the exercise of sound discretion on the part of the receiver 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 trustee to contract with and pay himself for such extra services as it would be to allow him to become the purchaser of trust property which it is his duty to sell to the best advantage for the benefit of the estate. * * * No allowance for extra counsel fees to himself can therefore be made to a receiver or other trustee upon the settlement of his accounts. ”
These cases were commented on and approved in Collier v. Munn, 41 N. Y. 143; and the doctrine was again repeated that an executor or trustee cannot receive from the estate any greater compensation than the statute commissions for his own services, however meritorious or ex- • traordinary they may be. This case arose when an executor, who was an attorney, at the instance of the coexecutor and the legatee and devisee of the real estate, solicited him to defend an action of ejectment prosecuted to recover real estate claimed as a part of the property of the testator, and the coexecutors and devisee agreed to pay him for such services, and the court, in concluding its opinion in that case, uses this language:
“With the unreasonableness of the resistance of this claim of the appellant, which is for valuable services, rendered in good faith, far beyond what his duty as executor required, or with the eminent propriety of payment by the adult legatees for a service from which they have apparently derived so considerable a benefit, we cannot deal. ”
Within this rule, we are not to speculate whether or not the trust estate was benefited by those professional services, as it would seem that, within these decisions, we have no duty left, except to obey the rule of law to which we have referred. Nor do we see how, upon this appeal, we can charge the expense of the unsuccessful effort of the bank to remove the assignee upon the respondent. The costs of that proceeding ought to have been fixed, as they probably were, by the order denying their application, for the removal of the assignee; and, if not satisfactorily disposed of by that order, it could have been reviewed on an appeal from it.
Many other questions are raised on this appeal, but we see no error against the appellant, on this appeal, for which this decree can be reversed.