110 Ala. 585 | Ala. | 1895
In the case of Horse Creek Coal & Coke Company v. Lady Ensley Coal, Iron & Railroad Company, the Central Trust Company of New York, ct al., pending in the chancery court of Walker county, involving the administration and disposion of the property of the said Lady Ensley Company, the appellant, W. K. Saulsbury, was, on application of the complainant for the appointment of a receiver of such property, duly appointed as such on the 19th day of April, 1893, and he qualified and entered upon the duties of his office. Pending an appeal from the register’s order appointing him, towit, on the 4th day of May, 1893, he filed in the cause his resignation of the office. On May 8, 1893, the chancellor, bv a decretal order duly enrolled, accepted the resignation, to take effect upon the qualification of his successors therein appointed, and ordered him to turn over to such successors, A. G. Smith and George L. Morris, when qualified, all the property of the said Lady Ensley Coal, Iron & Railroad Company, and to
It appears, from.the evidence, that the receiver voluntarily resigned, after serving 15 days, for the reason that he became tired of the trouble and annoyance of the office. We will not inquire whether a receiver, after accepting the appointment, may, as matter of right, renounce the office and its duties; for, however that may be, the court appointing him may sanction it, as was done in the present case. It does not appear that appellant was guilty of any malfeasance or improper discharge of duty which superinduced his resignation and its acceptance by the court. Under these circumstances, it is equitable that lie be protected, within the limit of just principles, against personal loss in respect to the expenses of his administration. In awarding him this protection, care should be taken that no burden be imposed upon the trust estate which ivas rendered inequitable by his-voluntary and premature termination of his office. The estate will not, by his act, be subjected, in his favor, to a double burden. As he was entitled to reasonable legal advice and assistance, so were his successors ; and lie can not ask allowance for the value of legal service which must needs have been secured and paid for by his successors. .When witnesses, therefore, fix the value of a general retainer for the whole administration, which was, as to the appellant, cut short, almost in its inception, by his voluntary resignation, they 'reckon upon an improper basis. It is not, in such case, a question of the value of such retainer, as between attorney and client. If the contract between them entitles the attorney to full compensation for the whole trust, the client assumes the personal burden and duty of its discharge, without reimbursement, when, by his own act, he deprives the estate of the benefit of the service. We can not, therefore, act upon the estimates of those witnesses who ignore these qualifying cond-i--
The appellant was entitled to legal advice as to the' general nature and extent of the duties enjoined upon him by the order of his appointment, but it was not the province of an attorney to hunt up and take into possession the property which belonged to the estate. That was the receiver’s duty, and if he required aid in finding the property, he should have looked to the complainant, who was moving in the matter, and who procured his appointment, to furnish it. A lawyer could not have done it better. Any complication or obstacle arising, requiring legal advice or proceedings, in the reduction of the property to possession, would have justified the expense of an attorney. Nonesuch arose in this matter. At Sheffield, the officer in charge at first demurred, but readily yielded upon production of the receiver’s commission. The evidence shows that the property to be administered consisted of iron furnaces in Sheffield, coal and iron mines, in operation, in Walker and .Franklin counties, sundry stores, and many other articles of equipment of the various enterprises — all worth, perhaps, $1,500,000. General legal advice covering these vast duties was necessary, and the proof shows it was furnished by Mr. Moore. His competency and the efficiency of his advice are not assailed. Eleven witnesses for appellant fix the value of a general retainer for the entire receivership at from $1,250 to $2,000, averaging about $1,700. Three witnesses contra, — two say $150, and the other $150 or $200, for Moore’s general advice:
If it was customary and necessary for furnace and coal and coke operators to employ agents in writing, of which we see no proof, the preparation of a form of appointment would require some legal skill, for which a reasonable fee would be allowed. So, also, as to drafting contracts and bills of sale of iron, upon proof of facts showing that it was necessary. It appears that the two contracts were drawn in order to secure bank accommodations to meet pressing need of funds to operate the furnaces, by pledges or sales of iron. In such cases, it was necessary to have the services of an attorney.
In reference to the defendant’s appeal from the order appointing appellant as receiver, it was a matter which did not legally concern him. The complainant procured the appointment, upon the apparent equity of its bill and necessity for a receivership. Whether the appointment of a receiver was necessary and proper was for the complainant to show. The duty of sustaining the appointment devolved upon it. The receiver^ need have paid.no attention to the matter. If he chose to defend the appointment, it was his duty to pay for it. Compensation for that service will not be allowed.
Giving bond was a part of the receiver’s qualification. He was not receiver until, his bond was given and approved. It was his personal duty to prepare and execute it, and if he needed an attorney to do it for him, it must have been at his expense. The clerical duties of preparing and rendering inventories were merely ordinary duties of the receiver. It was proper for his general counsel to advise him of his duties to render inventories, and see that they were in proper shape, but such legal service is comprehended in the general retainer.
The necessity for application to the court for orders to the succeeding receivers, Smith and Morris, to pay laborers employed and worked by appellant, was brought about by the appellant’s voluntary resignation. The order of his appointment authorized him to “employ all agents, clerks, attorneys, and servants necessary and proper to aid him in the discharge of his duties as such receiver.’’ This carried with it authority to pay the reasonable cost of such assistance, without further ap
Appellant, as receiver, made a contract with Matthew, Addy & Co., Cincinnati, for the sale and shipment of irou to certain parties m that city; the firm agreeing to honor his drafts for 80 per cent, of price with bills of lading attached. He shipped about $10,000 worth of iron, and drew on the firm accordingly. When the drafts were presented, the firm had learned that appellant’s appointment as receiver was the subject of a pending contest in court, and, fearing liability to pay the money to some one else, declined to pay the drafts, and one of them went to protest. It is admitted they were solvent and responsible, and appellant knew the cause of their refusal to pay. He was, at the time, very much engaged with the duties of his office, and needed the money to carry on the enterprises. He, therefore, procured his attorney, Mr. Moore, to go to Cincinnati to attend to the matter, with instructions to take such steps as were necessary to protect him, and, if the money could not be collected, to stop delivery of the iron to the consignees. Moore proceeded to Cincinnati, and, after considerable negotiation, procured a bank there to indemnify the firm a.gainst loss, and the consent of the latter to pay the drafts, which was done. Moore did not, himself, receive the money. We think the nature of the transaction justified the employment of an attorney to attend to it. It was a matter of importance, and might reasonably have required legal skill to determine the proper course to be pursued. If the money had been tied up and lost, through a failure to employ counsel, it is probable the receiver would have been responsible for it. As to the value of the service, 15 practicing lawyers testified. Ten placed the amount at not-less than $800 ; one, $500 to $800; another, $600 to.$800; two placed it at $100; one, at $150; and another, at $400. The register allowed $400.
It is customary and proper to allow a fiduciary the benefit of legal counsel to prepare his accounts for, and to represent him on, settlement of the trust. The set
The petition to the chancellor for a decree of reference to ascertain amount to be allowed for receiver’s compensation and solicitor’s fees and an order on the successors for their payment was rendered necessary by the appellant’s resignation. Otherwise, the questions would have come up on the final settlement of his accounts, after full administration of the trust. No fee should be allowed for it. There was some contest of the receiver’s claim for his own compensation, but to what extent we are not informed. Mr. Moore represented him in that matter. There was much contest of Mr. Moore’s claim, and considerable time and labor expended on it. The amount claimed was over $5,000. The register allowed $2,275,'which the chancellor reduced to $300. We have fixed his other fees at $1,400. It thus appears how greatly excessive his claim was, so far as the estate was chargeable therewith. The burden of the litigation was evidently caused by the excess, and the estate should not suffer on account of it. The claim for cash expended is too indefinite to enable us to determine whether the estate should bear it or not. Ordinarily, such expenditures are considered in the allowance of attorney’s fees, and not as a separate charge ; and it should appear that they were incident to the performance of necessary legal services. We adjudge to the appellant the following allowances for fees of his solicitor, J. J. Moore : General retainer, $750; preparing contracts for sale of iron, $50 ; adjusting claim against Matthew, Addy & Co. $400; representing receiver on final settlement of his accounts, $200; total, $1,400.
We have seen that, before realizing money to pay these claims, the receiver resigned, which act the court ratified by accepting the .resignation, and then ordered all property to be turned over to the successors, at the same time appointed. It was, therefore, impossible for
Reversed and remanded.