Case ID: ny-st-rep_44/html/0275-01.html
Source: Caselaw Access Project
Author: {"author": "Pratt, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

In the Matter of the Judicial Settlement of the Accounts of Richard A. Kenworthy et al., Ex’rs of Thomas Kenworthy, Deceased.
    
      (Suprerne Court, General Term, Second Department,
    
    
      Filed February 8, 1892.)
    
    1 Executors and administrators—Commissions—Code Civ. Pro, §- 2736.
    The power to apportion commissions under § 2736 of the Code does not include the power to totally abate any .executor’s compensation, except, possibly, in the case of misconduct resulting in loss, or where the estate is less than $100,000.
    2. Same.
    Where 'the estate exceeds $100,000, and there are but thre'e executors, each is entitled to full commissions, based on the whole estate, irrespective of which executor actually handled it.
    3. Same—Taxes.
    The validity of a tax against the estate cannot be determined on an accounting by the executors, and the same should not be charged against the-shares of those interested in the estate, but the amount thereof should be retained until its validity is determined.
    Appeal from decree of the surrogate of Dutchess county, entered upon a final accounting.
    The will of Thomas Kenwortliy appoints Richard Kenworthy, Richard A. Kenworthy and Alanson H. Saxton executors. A codicil, made shortly before the testator’s death, recites the death of Richard Ken worthy, and appoints in his place the testator’s wife, Martha J. Kenworthy, as executrix. The will was proved February 20, 1890, and the two executors took the oath of office on that day, and letters testamentary were issued to them. The executrix took the oath of office July 15, 1890, and letters testamentary were on that day issued to her. At the time of the death of the testator the property of his estate, which consisted' mostly of securities, was in the possession of the executrix, and at the request of one of the executors she passed them into his-hands. The delay in taking the oath of office by the executrix was in part because of her poor health, and partly because of a request of one of the executors, and from the counsel employed by them, the pretense by them being that such delay was for the purpose of preventing trouble. She united with the executors in the application for the probate of the will, in consultation with the counsel in relation to questions arising out of the administration of the estate, and in the employment of counsel. She told the executors that she was ready and willing to take an active part in the administration of the estate. She united in the return qf the inventory. She in fact received and disbursed only a small amount of money. She united with the executors in assigning securities to herself, in the payment of her legacy, to the amount of §14,447.92.
    
      It was stated (though not proved) on the hearing that the “ Estate of Thomas Kenworthy ” was assessed upon the assessment roll of the city of Poughkeepsie for the sum of $36,000.
    The decree disallows all commissions to the executrix, adjudges that certain securities be received and accepted on account of the trust fund of $40,000; that the trustees retain one-half commissions on receiving said fund, and that the executors pay two-thirds of the tax which may'be levied upon the assessment against “ The Estate of Thomas Kenworthy ” out of the income of the trust .fund.
    From these portions of the decree the executrix, Martha J. Kenworthy, appeals to this court.
    IF. Farrington, for app’lt; Charles F. Cossum, for ex’rs, resp’ts; ■Jacob Halstead, guardian ad litem, and for residuary legatees.
   Pratt, J.

Section 2736 of the Code provides that, where a de■cedent’s personal estate amounts to $100,000, or more, over all ■debts, each executor, not exceeding three, is entitled to full compensation, unless the court shall apportion the aggregate according to the services rendered. I do not understand that the power to apportion includes the power totally to abate any executor’s compensation except, possibly, in the case of misconduct, resulting in loss, or where the net estate is less than $100,000.

There seems to have been no occasion to apportion the aggregate in this case, at least no such thing was done, and nobody complained on that account. Two executors have received their full compensation. The executrix was not allowed any compensation. I think this was wrong. The statute as applied to this ■case says that she. was entitled to full compensation because there was nothing taken from her compensation or any apportionment She qualified and did do some acts in administration.

The basis for her commissions is the amount of the estate. I ■can see no other meaning to the words “full compensation.” This “compensation” is by means of commissions. Full compensation, therefore, means “full commissions.” And that is based on the whole estate irrespective of which executor actually handled it. Valentine v. Valentine, 2 Barb. Ch., 430.

I do not understand the case of Manice, 31 Hun, 119, to be in -conflict with these views. That was a case of two executors who had administered an estate. It does not appear that the net estate ■amounted to $100,000. Hence, there was but one commission to be allowed, and that was awarded to the executor who did the work. Here, as already observed, the statute is peremptory and gave this executrix full commissions, because nothing was taken from her commissions by apportionment.

* 1 do not understand that the surrogate has allowed full commis: •sions to the trustees as trustees, but one-half commissions for receiving the trust and one-half for paying out such a part as they have paid. Tin's seems sanctioned by authority.

Assuming that the tax was a proper charge, the disposition ■which the surrogate made of the matter was just and fair.

We cannot now undertake to hold the tax invalid as against the public authorities, and it may be that we could not lawfully do so when we come to hear what they have to submit. But it would .seem from the facts now disclosed that it may well be doubted if any tax is payable.

There seems to be an irregularity in the assessment which under Trowbridge v. Horan, 78 N. Y., 439, will render it invalid.

The tax authorities cannot tax the estate of a decedent They may tax the property against the owner thereof whether held ab.solutely or in trust They do not seem to have done that, but to have assessed the estate as such. This form of assessment was held invalid in Trowbridge v. Horan, and I do not see why it was valid in this instance. I cannot, therefore, concur with the learned .surrogate in actually charging the parts of this tax on shares. Non constat it may never be,paid. For aught that I can now see it ought not to be paid. It may be, however,, that when-the public authorities come to be heard on this matter, they may show some facts, not now disclosed, which will show that this tax ought lawfully ■> >e paid. If so it will be time enough to direct payment thereof. The decree, should, therefore, be modified by allowing the retention of the money in the proportions indicated which shall be charged if the tax is held payable; otherwise it .should be distributed among the parties entitled thereto.

In view of the fact that the appeal of the executrix is well founded, she ought to have her costs and disbursements of this .appeal payable as a part of the expenses of the estate generally. The result also shows that it was reasonable that she should have the benefit of the advice and services of counsel before the surrogate on the accounting. She w.as, therefore, entitled to indemnity against her expense for that cause, within the statutory limit, quite as plainly as for her traveling aiid other expenses.

The decree should be resettled so as to provide for her commissions and the costs and disbursements of this appeal and her counsel’s services within the statutory limits as part of her expenses, and also to provide for the tax matter as herein indicated.

Barnard, P. J., and Dykman, J., concur.