85 A.D.2d 669 | N.Y. App. Div. | 1981
Lead Opinion
In a proceeding to judicially settle the account of the estate of James M. O’Hara, claimants-objectants Kleinman & Saltzman appeal from an order of the Surrogate’s Court, Westchester County (Leggett, J., on the order; Brewster, S., on the decision), dated May 13, 1981, which denied their motion to dismiss the executrix’ defenses to their claim for attorneys’ fees and for summary judgment on this claim. Order reversed, on the law, with $50 costs and disbursements payable out of the estate, and motion granted. Eleanor O’Hara is the widow of James M. O’Hara and the executrix of his estate. At the time of his death, Mr. O’Hara and claimants-objectants Kleinman & Saltzman, together with two others, De Nolfo and Reventas, were defendants in a suit brought by L. A. Industries, Inc. The suit involved allegations that O’Hara, a director and shareholder of L. A. Industries, had wrongfully appropriated for his own profit an opportunity which had come to his attention in his official corporate capacity. Kleinman & Saltzman represented all the defendants in the suit. When O’Hara died, they assumed representation of his estate and of his widow as executrix and individually. On or about February 5, 1975 the lawsuit was settled. The total amount of the settlement was $177,500. At that time, defendants Di Nolfo and Reventas came alone to Mrs. O’Hara’s home and told her that it would be necessary for her to contribute $75,000. Kleinman & Saltzman were not present and at no time did they discuss the matter with her or make any representations to her concerning it. Mrs. O’Hara was aware that the litigation involved her husband’s interest in the Kord Company, which owned Hidden Hollow, a 285-unit garden apartment complex in Dutchess County. Mr. O’Hara owned a 40% share of Kord, which share could be estimated at $2,280,000 if each unit were valued at a minimum price of $20,000. She knew the physical extent and estimated value of the project at the time of the settlement. She thus paid $75,000 in order to protect a potential investment of much greater value. Although she alleged that she paid the settlement from personal funds, there is no evidence that the money came from other than estate funds. Kleinman & Saltzman neither contributed nor were they asked to do so; the balance of the settlement was paid by the other defendants. Prior to his death, Mr. O’Hara had received money from one Rico Brunette as an investment in L. A. Industries. O’Hara had signed a promissory note to Brunette in the amount of $12,000. Mrs. O’Hara knew of the matter and acknowledged her husband’s liability to Brunette. On June 4,1975 Kleinman & Saltzman wrote to Mrs. O’Hara, advising her that Brunette had filed a claim for $12,000 against the estate, and suggesting that $1,000 be offered him in settlement. On February 3, 1976 they wrote to her again,
Lead Opinion
Rabin, J. P., Margett, O’Connor and Thompson, JJ., concur.