Case ID: nys_56/html/0989-01.html
Source: Caselaw Access Project
Author: {"author": "INGRAHAM, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

In re WHITEHEAD. In re STEINWAY'S ESTATE.
    (Supreme Court, Appellate Division, First Department
    March 24, 1899.)
    1. Surrogates’ Courts—Jurisdiction—Disputed Claims—Payment.
    A surrogate’s court has no jurisdiction to compel payment of disputed claims against a decedent’s estate.
    3. Executors—Accounting—Petition by Creditor.
    • Though Code Civ. Proc. § 2727, authorizes the surrogate’s court to require executors to account, at the instance of a creditor, in the absence of good cause shown to the contrary, yet where the claim is disputed, and the executors allege facts which, if true, tend to show that petitioner is not a creditor, the petition should not be granted.
    8. Same—Claims—Establishment.
    Mere presentation of a claim against an estate to executors, and silence on their part, do not render a claim an established one, so as to give the surrogate’s court jurisdiction to decree its payment on a settlement of the executors’ accounts.
    4. Same—Invalid Order.
    Where a surrogate erroneously ordered an accounting by executors at the instance of a creditor whose claim was disputed, such order is not validated by Code Civ. Proc. § 2726, authorizing the surrogate to require an executor to account at any time, in his discretion,—especially where the estate is large, and not ready for distribution, and the granting of the order would he an abuse of discretion.
    Appeal from order of surrogate, New York county.
    Proceeding by John Whitehead, a creditor of the estate of William' Steinway, deceased, against Charles H. Steinway and others, executors, to compel a judicial accounting. From an order directing the accounting, defendants appeal.
    Reversed.
    Argued before VAN BRUNT, P. J., and BARRETT, RITMSEY, O’BRIEN, and INGRAHAM, JJ.
    J. Delahanty, for appellants.
    George H. Bruce, for respondent. '
   INGRAHAM, J.

The petitioner presented to the surrogate a petition alleging that he was a creditor of the estate of William Steinway, deceased; that he had filed his claim with the executors, and that Ms said claim was thereupon admitted; that more than 18 months have expired since the granting of letters testamentary; and that Ms claim has not been paid, and no accounting has been made by such executors; and the petitioner prays that a citation may issue, directed to said executors, requiring them to show cause why an order should not be made directing that the executors judicially settle their accounts as such executors of the estate of William Steinway, deceased. Upon the return of the citation an answer was filed on behalf of the executors denying that the claim had been admitted, denying that the petitioner was a creditor of the estate, and alleging facts wMch, if true, show no liability on the part of the estate. This answer was verified by one of the executors. The petitioner replied, setting up facts wMch, if true, would tend to show that he had a valid claim against the estate. Neither the petition nor the reply was verified by the petitioner, but by his attorney, upon information and belief; alleging that the attorney’s knowledge of the facts was derived from statements made to him by the petitioner’s agent, and from papers, writings, and documents in the deponent’s possession. Upon these papers the surrogate made- an order directing the executors to account. We think tMs order should be reversed.

The jurisdiction of the surrogate to compel payment of a claim against an estate is confined to undisputed claims. If the executors dispute the claim, or have such knowledge of it as enables them to doubt its validity, the surrogate has no power to order the payment of the claim. The claimant is compelled to resort to Ms action in a court having jurisdiction to try disputed claims. Lambert v. Craft, 98 N. Y. 347. The only object in the surrogate’s requiring the executors to account upon an application of a creditor is that a decree may be entered, under the provisions of the Code, directing the executors to pay the claim, if they have assets of the estate in their hands sufficient for that purpose. It is true that under section 2727 of the Code a creditor may present a petition to the surrogate, praying for a judicial settlement of the accounts of the executors, and -that, unless the executors show good cause to the contrary, an order should be made directing them to account; but where the executors show that the claim is disputed, and allege facts wMch, if true, would tend to show that the petitioner was not a creditor, then we think that good cause has been shown to the contrary, and the petitioner should establish his position as a creditor by resorting to an action in a court which has jurisdiction to try a disputed claim. The mere presentation to the executors of a claim, with silence on the part of the executors in respect thereto, does not render the claim an established one, so as to give to the surrogate jurisdiction to decree its payment on a settlement of the executors’ accounts. In re Callahan’s Estate, 152. N. Y. 320, 46 N. E. 486, where the court say:

“We are of the opinion that the mere silence on the part of an executor or administrator after the presentation of a claim under the statute, accompanied by lapse of time, will not in any case preclude the representative from thereafter contesting its validity. * * * But the claim does not become-established from mere silence of the executor or administrator.”

In this case the executors have distinctly disputed the claim by a verified answer, and the surrogate was without jurisdiction to determine the question whether the disputed claim was valid, or to decree its payment.

It is said, however, that under section 2726 of the Code a surrogate has power, in his discretion, at any time to require an executor to account, and that such power may be exercised with or without a petition or suggestion from any one; and,- the surrogate having exercised his jurisdiction, the fact that the petitioner was not a creditor-would not justify a reversal of the order. It is a sufficient answer to. this to say that the surrogate has not exercised this power. The pro.ceeding was commenced by a person claiming to be a creditor for the purpose of establishing his.interest in the estate as such creditor, and it was to enforce this alleged right of the petitioner that the order-was made. So far as appears, no one whose interest in the estate-is undisputed requests an accounting at the present time. ' It now appears that the petitioner’s claim is disputed by the executors, that the surrogate would have no power to order payment of that claim by the executors, and that the estate is not in such a condition that there can be a final accounting. The only result of decreeing such an accounting would be that an expensive preliminary account would be required, when the estate is not ready for final distribution, and when no benefit could accrue to the petitioner, as the surrogate would have no jurisdiction to decree payment of his claim.

Counsel for the executors states that this estate is very large, exceeding $1,500,000. An accounting of such an estate would involve-great expense, which must be borne by the estate, and, so far as appears, would be of no advantage to any one. We think that to order an accounting under such circumstances was an abuse of the discretion vested in the surrogate, and justifies the interference of this, court.

The order is therefore reversed, with $10 costs and disbursements* and the proceedings dismissed, with $10 costs. All concur.