251 P. 907 | Cal. | 1926
Three residuary legatees under the will of Clark Parker, deceased, have appealed from that part of an order settling the executor's final account which allows $40,000 as extra compensation to the attorneys for extraordinary services alleged to have been rendered by them in the probate proceedings.
The respondent, Leon M. Abbott, is the executor of the will, appointed as such by the superior court for Los Angeles County. Mr. Abbott is a member of the law firm of Bates, Nay, Abbott Dane, a firm of attorneys practicing law in the state of Massachusetts with offices in the city of Boston. *134 He employed this firm and two Los Angeles lawyers, Messrs. Henry O. Wheeler and Henry O. Wackerbarth, to act as his attorneys in the performance of all the legal services incident to the probate proceedings. When the estate was ready for distribution respondent filed his final account, report, and petition for distribution. In the account he claimed credit for all of the statutory commissions and all of the extra compensation to which he possibly could be entitled as executor under the statute as it then read; he also claimed a credit for all of the statutory commissions to which his attorneys could be entitled, and an additional sum as extra compensation to them for extraordinary legal services alleged to have been performed by them. The specific amounts for which he thus claimed credit in his final account are: (1) $3,147.13, the regular commissions due him under section 1618 of the Code of Civil Procedure for ordinary executorial services; (2) $1,573.57 (one-half of the regular commissions) as extra compensation for extraordinary services performed by him as executor; (3) $3,147.13, the regular attorneys' commissions allowable under sections 1618 and 1619 for legal services rendered in conducting the ordinary probate proceedings; and (4) $50,000 as further compensation to the attorneys for extraordinary legal services alleged to have been performed by them. In due time the residuary legatees who have taken this appeal appeared in the court below and objected to the allowance of any amount for extraordinary legal services. Thereafter the court made an order settling respondent's final account. The order allows the items of $3,147.13 and $1,573.57 as credits, respectively, for respondent's regular commissions and extra compensation for extraordinary services performed by him as executor, the item of $3,147.13 as attorneys' fees for the services of the attorneys in conducting the ordinary probate proceedings, and the sum of $40,000 as further compensation to the attorneys for extraordinary legal services performed by them. Included in this item of $40,000 is an undetermined amount representing the share of respondent's law firm in the extra compensation for extraordinary services. That is to say, the amounts due respectively to respondent's law firm and to the two local attorneys for such extraordinary services are not segregated but are lumped in one sum. It is from the allowance *135 of this credit of $40,000 that this appeal is prosecuted.
At all the times when respondent performed his services as executor, and, indeed, at the time when the court made its order settling the final account and decreeing distribution, section 1618 of the Code of Civil Procedure provided that an executor, when no compensation is provided by the will or he renounces all claims thereto, shall be allowed, as compensation for his ordinary services, commissions at certain specified rates upon the amount of the estate accounted for by him, and that "such further allowance may be made as the court may deem just and reasonable for any extraordinary service," but that the total amount which the court may allow for extraordinary executorial services shall not exceed one-half the amount of commissions allowed the executor for his ordinary services. By section 1619 it is provided that attorneys for executors and administrators shall be allowed as fees for conducting the ordinary probate proceedings the same commissions that are allowed to executors and administrators under section 1618, and that for any "extraordinary services" rendered by the attorneys, such as sales or mortgages of real estate and other specifically designated kinds of professional services, "such further allowance may be made as the court may deem just and reasonable." By an amendment which became effective July 24, 1925 (Stats. 1925, p. 624) — two and one-half months after the entry of the order settling the final account and decreeing distribution — section 1618 was so amended that, as it now reads, no limitation is placed upon the amount of the extra compensation which may be allowed an executor for his extraordinary services.
An executor, administrator, or testamentary trustee who is himself an attorney at law may properly employ another attorney to render the necessary legal services for the estate, and he may be entitled to an allowance out of the estate for the value of such legal services. (Estate of Graham,
An executor or administrator who is himself a lawyer may be allowed a credit for fees to be paid a law firm of which he is a member, if it was agreed between him and his partners that he is not to share in the moneys to be received by the firm for its services. (Estate of Schillaber, 1 Cof. Prob. Dec. 101.) But if he is to participate in the compensation to be earned by his firm, then the same principles and policies which are opposed to the allowance of additional compensation to an executor or administrator for legal services rendered by him individually as an attorney at law are equally opposed to the allowance of compensation to his law firm. (Taylor v. Wright, supra; Liles'Succession, 24 La. Ann. 490; Needham v. Needham, 34 Idaho, 193 [200 P. 346]; Collins v. Carey, 2 Beav. 128 [48 Eng. Reprint, 1128]; Christopher v. White, 10 Beav. 523 [50 Eng. Reprint, 683]; Lyon v. Baker, 5 De Gex S. 622 [64 Eng. Reprint, 1271].) As was said by the Indiana supreme court inTaylor v. Wright, supra: "To hold that an executor or administrator, while he may not be compensated out of the estate for his individual legal services, can share with a partner compensation for legal services rendered the estate *138 by the firm, would be suggesting an easy method for evading the law." The record before us is silent as to the existence of any express agreement between respondent and his partners as to whether he was or was not to participate in the compensation to be received by his firm for its legal services. In the absence of any such showing the presumption is that respondent was to share the compensation with his partners. (Needham v. Needham,supra; Liles' Succession, supra.)
From the foregoing it follows that the court erred in allowing the item of $40,000, unless justification therefor may be found in some provision of the statute. Section 1618 of the Code of Civil Procedure, as we have seen, provided, at the time of the rendition of the professional services, that an executor shall be allowed certain specified commissions for his ordinary services, and that, for any extraordinary service performed by him as executor, such "further allowance may be made as the court may deem just and reasonable," not exceeding one-half of the commissions allowable for his ordinary executorial services. Cases are to be found in some jurisdictions which hold that where it is provided by statute that executors or administrators may be allowed extra compensation for extraordinary services, an executor or administrator who, being an attorney, performed legal services for the estate may be allowed, in addition to the usual commissions attached to his office, a further compensation for his legal services. (Sloan v. Duffy,
But even if public policy had nothing whatever to do with the rule, and even if it should be held that, where the statute allows an executor extra compensation for his extraordinary services, a lawyer-executor may be allowed extra compensation for extraordinary legal services performed by him or by his law firm, nevertheless respondent still would fail to uphold the propriety of the credit for $40,000. As we already have stated, a portion of that sum — how much does not appear — represents the share claimed by respondent's law firm for its part in the extraordinary legal services; and the balance, whatever it may be, represents the share of the two local attorneys for their part in such services. If, therefore, this item of $40,000 were allowed, then respondent, as one who is entitled to participate in the profits earned by his law firm, would receive some part of this extra compensation. But in the item of $1,573.57 allowed him as extra compensation over and above his commissions for ordinary executorial duties, he already has been allowed all of the extra compensation to which, as executor, he possibly can be entitled under section 1618 as it read at the time when *141 the services were rendered. It follows, therefore, that any allowance of compensation to his law firm for extraordinary legal services, or even for ordinary legal services, must inevitably result in respondent receiving more than was allowable to him as executor under section 1618 prior to its amendment in 1925. Therefore, even if we were to give to that code section the same effect which the Wisconsin court in Sloan v. Duffy, supra, gave to a similar statutory provision, the allowance of this item of $40,000 would be improper nevertheless.
Respondent seeks to avoid this conclusion by arguing that his right to extra compensation must be measured by section 1618 as it now reads, and that, since that section no longer places a limit upon the amount which may be allowed an executor or administrator as additional compensation for an extraordinary service performed by him, the extra compensation which already has been allowed respondent for his extraordinary services as executor presents no obstacle to an allowance of the item of $40,000, if the reasoning of the Wisconsin case be followed. Respondent takes the position that if, subsequent to a judgment appealed from and prior to a decision by the appellate court, there be an alteration or repeal of the law applicable to the rights of the parties, the appeal must be decided according to the then existing law — citing United States v. SchoonerPeggy, 5 U.S. (Cranch) 102 [2 L.Ed. 49, see, also, Rose's U.S. Notes], and a number of other analogous cases. The cases cited by respondent are not applicable to the situation here presented, and there is no merit in his contention. A decision on the rights of the parties to this appeal in accord with the provisions of section 1618 as amended in 1925 would give to that amendment a retroactive effect. But that effect we may not give for the reason that no part of the Code of Civil Procedure "is retroactive unless expressly so declared." (Code Civ. Proc., sec. 3; Central Pac. R.R. Co. v. Shackelford,
Though the part of the order appealed from must be reversed for the reason that it allows the executor, indirectly, compensation which should not be charged against the estate, it does not necessarily follow that the local attorneys, Messrs. Henry O. Wheeler and Henry O. Wackerbarth, are not entitled to extra compensation for any extraordinary legal services which they may have performed.
In his petition for an allowance of extra compensation for the attorneys, respondent describes many different kinds of services, a number of which unquestionably cannot be classified as extraordinary legal services. Take one example, for illustration: It is alleged that respondent and his counsel studied the stock market in order to be able to make an advantageous sale of certain shares of stock belonging to the estate. This is not a professional service for which a lawyer may make a charge payable out of the estate. It is but the performance of an ordinary duty of the executor in selling the property of his testator. The order from which the appeal was taken does not show what services were made the basis for the allowance of the $40,000. From the record before us it is not possible to determine what part, if any, of the $40,000 was allowed for services which are not extraordinary legal services within the meaning of section 1619 of the code. That this situation, in the event of a *143 second appeal, may not again arise, the lower court, on the going down of the remittitur, should, if counsel be so advised, entertain a motion to strike from the petition all references to services which are not "extraordinary" legal services within the meaning of section 1619; or, as an alternative, that court, on the retrial of the issues involving the claim of the two local attorneys for extra compensation, should expressly find, either by appropriate recitals in the order or otherwise, the precise services performed by the local attorneys, if any, which it finds to be extraordinary.
The part of the order appealed from is reversed, and the matter is remanded to the lower court for a new trial, in accordance with this opinion, upon the issues presented by respondent's petition for extra compensation to the attorneys.
Shenk, J., Curtis, J., Richards, J., Sullivan, J., Waste, C.J., and Seawell, J., concurred.