Weed's Estate, 163 Pa. 595

Weed's Estate

163 Pa. 595 | Pa. | 1894

Opinion by

Mb. Justice McCollum,

The learned auditor thought and so held that he was not at liberty to set aside or qualify the order of the court of common *598pleas fixing the compensation of counsel for services rendered in the interest of the estate and authorizing the payment of the same by the trustee. He also held that no sufficient reason appeared for relieving the creditors, whose action made necessary the litigation in which the services were rendered, from paying their proportion of the-allowance. In these rulings he was sustained by the learned court below and the question on this appeal is whether he erred in making them.

It seems to us that the proposition that, an auditor may review and disregard the judgments and decrees of the court that appointed him is somewhat novel and we are not therefore surprised that the learned counsel for the appellants have failed to bring to our notice any authority for it. They have referred us to article 5 of the amendments to the constitution of the United States and to section 3 of article 1 of the constitution' of Pennsylvania, but these do not throw light upon or define the powers of the auditor in the case before us. His powers were derived from and measured by his appointment, and we think he evinced a proper understanding and appreciation of them in declining to receive evidence offered for the purpose of modifying or setting aside the decree under which the accountant made the payment excepted to.

The services for which the allowance was made were rendered in a litigation instituted by the general or unsecured creditors to set aside a certain conveyance made and certain judgments confessed by the trustee for the purpose of giving a preference to certain other creditors of the estate. When the attempt was made to prefer some creditors to. the exclusion of others having equal rights and equities, the estate and the trustee were insolvent. The creditors for whose benefit the transaction was intended, having knowledge of the purpose of it, accepted the conveyance and judgments and stubbornly resisted the efforts of the unsecured or excluded creditors to have them annulled. For more specific information in regard to the nature and details of the transaction and the circumstances surrounding it, we refer to Woddrop v. Weed and Young v. Weed et al., 154 Pa., pages 307 and 316. It will there be seen that the litigation resulted in a victory for the unsecured creditors which restored to the estate a large amount of property, to be used and applied in accordance with the trust for the benefit *599of all the creditors! Why should not the expenses incurred in achieving this result be paid out of the common fund without discrimination between the parties entitled to it? What equity have the parties, who were baffled in their effort to obtain more than their share of the estate, to demand discrimination in their favor? We have failed to discover any. It was their greed for more than they were entitled to under the trqst that made the expenses necessary, and it seems to us that under the circumstances they ought not to complain that the burden of paying them is laid on the common fund. It is argued,' however, that they were losers by the litigation and therefore they are not within the rule recognized and enforced in Trustee v. Greenough, 105 U. S. 527, and kindred cases. But in what sense were they losers ? In the same that he is a loser who fails to acquire what he has no right to, or who, having unlawfully obtained possession of the property of another, is compelled to restore it to the owners. The equity which the wrongdoer has in consequence of such a loss is not easily discoverable. If the allowance in this case was for services in a suit to recover the trust property from a stranger who had unlawfully taken it into his possession, there could-be no doubt that equity would require that it should be paid from the trust fund. The fact that the wrongdoers were creditors of the estate ought not to shift the burden from the trust fund to that portion of it which the creditors were entitled to receive on a pro rata distribution of it. In either case the services were for the benefit of the estate and it should pay for them. The specifications of error are overruled.

Decree affirmed and appeal dismissed at the costs of the appellants.