### IN THE COURT OF APPEALS OF TENNESSEE AT NASHVILLE May 6, 1999 Session
IN RE: ESTATE OF

M.L. WAKEFIELD , DECEASED Appeal from the Probate Court of Davidson County No. 94P1917 Frank G. Clem ent, Jr., Probate Judge

M1998-00921-COA-R3-CV - Filed Dec ember 10, 2001

This case involves a dispute over the compensation sought by two of three co-executors of a will that
was drafted by

one of them. The will provided that the executors should be “ paid fee s equal to

those fees customar

ily c harge d by NationsB ank of Na shville.”The two c o-execut ors e ach received

an interim payment of $50,000 in compensa tion, and then sought additional payme nts under the fee schedule. The adult beneficiaries of the will challenged the amount of compensation sought by the
co-executors. Disagr

eementsand tensi ons contin ued betw een the b eneficiaries and the two nonfamily co-executors, and, after strong sug gestion by the pr obate court, the two no n- fa mi ly c oexecutors resigned. The probate court hea rd eviden ce on t he fee request and refused to a ward additional fees. The court also ordered the attor ney co-executor, co- trustee t

o disgorge over $70,000 in attorney

fees paid by

the testamentary trust’s ma jor asset, a corporation formerly owned solely by testator. The co-executors, co-trustees were the directors of the corpora tion, and the disgorged fees hadbeen paid pursuant to a retainer ag reement pre-existing thetestator’s death. On appeal, the two co-executors contest th

eserulings . In a

cross-a ppeal, th e benef iciarie s argue

that the p robate court erred in den ying t heir re quest that the co-executors disgorge additional fees. We modify the trial court’saward o f reaso nable fees but othe rwise af firm. Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Probate Court

Affirmed as Modified and Remanded

P ATR ICIA J. C OTTRELL , J., delivered the opinion of the court, in which W IL LIAM B. C AIN , J., joined. W IL LIAM C. K OCH , J R ., filed a separa te opinion

concurr ing in pa rt and dis senting

in part. Hugh C. Howser, Nashville, Tennessee, for the appe llants, Ron ald H. Pur sell and Rober t Whisenan

t.
RichardHolton and Charles A. Trost, Nashv ille, Te nnessee , for the appelle es, Judith Wak

efield Sand lin, Na ncy Wakefield Coleman, Micha el C. Wakefield, Linda Wakefield Melvin, Alden H. Smith, as guardian for Nathan Murr y Green, and Susan R. L

imor, as g uardian for Timoth

y L ouis Wakefield.-2- OPINION
Murrey Louis Wakefield, the testator, died in an automobile accident on December 18, 1994. He was seventy- eight (78) years old. Mr. Wakefield was survive d by four adult childre

n, Judith Wakefield Sandlin, Nancy Wakefie ld Coleman, Michael C. Wakef ield, and Linda Wakefield Melvin. One of the te stator’s children, Timothy M. Wakefie ld, had predeceased the testator, leaving two minor sons, Nathan Murray

Green and Timothy

Louis Wakefield. These children and grandchildren
were the beneficiaries of Mr. Wakefield’s estate. At the time of the testator’s death, his net taxa ble estate was wort h over $5 million while his gross estate was valued at $10.6million, according to the estate tax return. The principal asset was Feldkircher Wire Fabricating Company , Inc. (“FWC”), of which the testator had been the sole shareholder. I n addition, the testator owned the rea l proper ty on which FWC’s several facilities were located, and houses and other re al property, inc luding a farm on which he conducted a cattle breeding operation.
The testator ’s will ap

pointe d three c o-execut

ors: his da

ughter , Ms. Sandlin; his longtime personal and busine ss at to rn ey, Mr. Pursell, and his longtime personal and business accountant, Mr. Whisenant

. The will a

lso named those three individualsas co-trustees of all trusts established under the will. The will provided for compensationin return for discharging the du

ties atte ndant to these posi tion s, st ating:

No one acting as executrix, executor, or trustee shall be required to furnish any bond
or security of a

ny kind for the faithful performance of his or her d utiesas executr

ix, executor, or trustee. I direct that my co-executors and

co-trustees herein shall be paid fees equal to th ose fee s cust omari ly charge d by NationsBank in N ashville, Tennessee, or its succ essors f

or estate and trust administr

ation ser vices. The will was drafted by

Mr. Pursell, and the testator received advice fr om bothMr. Pursell andMr. Whisenant regarding the method of compe nsation for the executors and trustees. Thewill containedsevera

l bequest s of specific property to namedindividuals, and directed that the remainder of the estate’s assets, which included the stock in FWC, should be placed in the M.L. Wakefiel d Family Trust. Th at trust w as to be te rminated prio r to the eleventh anniversary of the testator’s death.
The will also direct e d the co-trustees to continue to operate FWC as its board of director s until the trust was terminated. The company had not previously had a board of directors, with the testator having exclusive co ntrol of its management and operation. The will specified that the directors could sell FWC if they deemed it financially advisable. The will required the co-trustees to continue the testator’s farming and cattle bre eding activities and to restore a specified house for one of testator’s children.
The will also included an in terrorem clause which provided for the revocation of the benefit s of any bene

ficiary w ho contested the will. This clause stated:1 The execu tors made arrange men ts for Mr. Pursell’s l aw firm to han dle the matters ari sing from the c oll isi on

that took the t estat or’s l ife. Ulti mately, t he firm fi led a wrongful death act ion which result

ed in a set

tlement, approved by the co urt, fo r ov er $1 .5 m illion, w ith the la w firm receiv ing $ 495 ,037 in fees

. Th e net p roce eds w ere p aid d irectly to the heirs. -3- If a n y beneficiary her

eunder shall contest the probate or validity of this will or any provision herein, or shall institute or join in (except as a party defendant) any proceeding to contest the validity of this will or to prevent any provision herein from being im plemented in acco

rdance withits terms (

regar dless of whether or not such procee dings are instituted in good faith and with pro bable ca use), the n all bene fits providedfor such

beneficiary

are her eby revoked , and such benefi ts shall pa ss to the issue of said beneficiary , equally, or if the be neficiary dies without issue then such benefit shall pass pursuant to the terms and conditions stated herei n . Each be nefit conferred herein is made on the condition precedent that the benef iciary shall ac cept andagree to all the provisions of this will and the provisions of this paragraph are an essentia l part of e ach and

every benefit

. On Decembe r 28, 1 994, Mr. Pursell filed a petition to probate the testator’s last will and testamen t. That day the pr

obate court issued an order admitting the testator’s will into probate. The
c o-executo rs then took s teps to man age the estate, including

retaining couns el to purs ue claims agains tthe driver of the car which collided with the testator, 1 finding alternativefina ncin g for FWC to retain its cash flow, and taking out a $950,000 loan to cover a portionof the federal e state taxe s.
Almost fro m the firs t, contro versy arose be tween the beneficiaries, including Ms. Sandlin, andthe non-family co- executors, Mr. Pursell and Mr. Whisenant (“Appellants”). Early on, Appellan ts made it known that they thoug ht it was in the estate’s best interest to sell FWC. One suggestion

Appellants made was to effectuate an employ ee stock option plan (“ESOP plan”), which would have g iven the e

mployees owne

rship of th

e compan y, a nd th ey spent con siderab le time researchingthis option. The adul t benefi ciariesobjected to this pla n becau se they

prefer red to re tain the company for

themselves.

Mr. Pursell, or his law firm, initially also provided leg al representation to the estate. Becau se of developing diff

iculties b etween

Appellan ts and the beneficiaries, A

ppellant s retained new cou nsel for the estate in the spring of 1996, “for the purpose of assisting in dealings with the beneficia ries and in order

to remove

any appare nt conflict of inter

est that mi ght ari se from c ontinuin g representat

i on by Mr. Pursell’s firm.” Mr. Whisenant’s a ccounting firm provided accounting services to the estate.
The number of disagreements between Appellants and the beneficiaries is evidenced by the various filings over

the course of the proceedings be low and is acknowledged and recounted in the briefs before

this cour t. Most of the substantive disputes regar ding man ageme

nt of the e state’s a ssets have been resolved and are not on appe al. Appellants resigned as Co-Executors and Co-Tr ustees, as reflected in an agreed order entered in July of 1997, in whic h the bene ficiari es agr

eed toindemnify2 Federal and state estate taxe s becam e due so me nine m onths a fter the tes tator ’s death. The esta te owed

app rox ima tely $2.7 m illion in estate taxes. To ma ke th e initial pa ym ent, w hich wa s due in Sep tem ber o f 19 95, th e estate had to bor ro w $ 950,000. According to Appellant s, t he taxes deepl y concerned them because they face d personal liability as co -exe cuto rs if they were no t paid. Thus, the indemnity prov ision was an impo rtant part of an y ag reem ent.

3 Sho rtly ther eaft er, Appell ants fil ed a petit ion t o sel l re al pr opert y, ar guing that c ert ain pr opert y shoul d be sold to pay th e estate ’s taxe s, deb ts, exp ense s, perso nal re prese ntative s, and cred itors. The benef ici ari es con tes ted t

h e petiti on.

4 The same day, the benefi ciari es fi led a motion f or appoi ntment of

busi ness advis ors, seeki ng the r eplac ement of A ppe llants w ith two othe r indiv idua ls.
-4- Appellan ts from “a ny a nd all dutie s, respon sibilities, liabilitie s, and/or obligations of either of them arising out of or in conne ction with t he duties and obligations in each capacity .” 2 First American National Bank was appointed as substitute Co-Executor along with Ms. Sandlin. That same order reflects that Appellants also resigned as directors of FWC.
The issues in th

is appea l involve c ompensat

ion to Appe

llants. Th

e factsreleva

nt to those issues involve a detailed procedural history , of which the following is a summary . Beginning with the interim

accounting for the period ending November 20, 1995, the beneficiaries have questioned details of acco unti ngs and questioned or opposed various actions proposed or taken by A ppellant s. For exa mple, in an exception filed to this first accounting, three beneficiar ies asserted that the accounting was inadequate, challenged the pr opriety of a

$159,000 l oan the e state mad e to FWC, and excepted to pay ment of ov er $128, 000 in leg al and pr ofession al fees

. 3

On April 9, 1996, Appellants petitioned the court for approval of fees, seeking pay

ment for their activities as executors, members of theFWC board of directors, and accountants and lawy ers for the esta te. They sought in

terim pay ments of $ 120,000 to

be equa lly d ivided am

ong th e co
executor s, and an hourly f ee of $125 for their work

on the board of directors. On October 18, 1996, the probat e court entered a consent order appr oving pay ment of an interim co-executors’ fee of $150,000 to be divided equally among the three co-executors. The order also approved pay ments of legal and accounting fees.
On March 7, 1997, Appellants sought approval of another interim pay ment of executors’ fees
o f over $91,000, which request had increased to $232,303 by the time of its hearing. The adul t benefici aries filed an objection to this request, arguing that the co-e xecutors had already

received substantial compensa

tion and th at the es tate wasexperiencing ca sh flow pr oblems. 4 Shortly thereafter, the adult beneficiaries filed a petition for cons truc tion of will, seeking instruction on whether they could con

test the f ees soug ht by Appellan ts without triggering the in terrorem clause. The beneficiaries argued tha t in calculating the compensation as equal to that “customarily cha

rged by NationsBank,” reliance on the printed fee sch edule sho uldonly be a starting

point for calculating fees because par

tie s in sizeabl e estate s customa rily negotia te and se ttle on fe es smalle r than tho se provided by strict applica tion of the schedule.5 Actu ally, the beneficiaries anno unced they wo uld accep t Appe llants’ resignations on terms and condi tions

previously off

ered by Appellants if t

he court approved. In additi on, anoth er unres olved matt er of cont enti on between the parties was raise d. Ap pellan ts asserted that, subj ect to the cour t’s app rova l, they were prepared to proceed with the ESOP plan p rovid ing for the emp loyees ’ owne rship o f FW C. The adu lt bene fi ciari es s ucce ss fu ll y s ough t a ddit ion al ti me to decide whether they wanted t o make a counterpropo sal to that plan. -5- Appellan ts responded

to the ben eficiaries’ petition for construction of the will by denying that the beneficiaries cou ld seek in str uctions with respect to the in terrorem clause, arguing that doing so defeated the clause’s purpose. The y also filed a c ounterclaim, seeking a declara tory judgment enforci ng t he in terrorem clause, which wou ld result in revoca

tion of be quests to those beneficiaries who filed the petition for construction.
On June 27, 1997, the probate court, on its own initiative, held a status conference. At the outset, the court observed, “I have continued to see fee requests that ar e not modest . . . and I have gottenthe clear indication that some beneficiaries are relucta nt, if not scared, to bring matters to this court’s attention .” Durin g this hearing, the court approved the beneficiaries’ decision to retain two independent

financi al adviso

rs and g ranted a 30-day stay on discove

ry to allow them to seek

loans to pay the re

mai nd er of the

estate ta xes. At the h

earing , Appella

nts ackno wledged the adul t benefic iaries’ desire for their resignation, but arg ued that the ir resignation would not be in the estate’s best inter

est. 5 Howeve

r, Mr. Pur se ll ultimatel y ag reed to resign as co-executor (a fter admitted, off-the-record encoura gement by

the probate court) on

condition thatthe parties agreed to indemnify him and hold him harmless. Mr. Whisenant resigned shortly thereaf ter.
After Appellants’ resignation, the issue of additional fees remained. The benefic iaries filed
a memor andum re sponding to Appella

nts’ application f

or appro val of inte

rim and final c o-executors ’ fees, objecting to the award of additional fees to Appe llants. Ultimately, the

co ur t h ea rd ni ne da ys of testimonyand argument

on Appell ants’ se cond fee request and the be

neficia ries’ re sponse the

reto over a period of almost five months. At the conclusion of these proceedings, the cour tentered an order deny ing Appe llants’ application for additional fees, stating “they shall recover nothing further from this estate.” The order specifically incorporated the oral findings made by the co urt at the conclusi on of the h

earing . Those f

indings include th

e following obse

rvation:
The real fly in the oint ment here starts, number one, with the lack of independent advice and counsel when a very complica

ted fee arrangeme

nt was proposed. I know Mr. Whisenant said it, that Mr. Wakefield said no to on e or more proposed fee schedules . . . andthen finally, when a fee schedule was sugg ested similar to that of
a bank, and I think they

presented NationsBank and one other bank’s, I believe Mr. Whisenantand/or Mr. Pursell suggested that Mr. Wakefield’s response was, “That’s good. That’ simple. That’s the way I want it.” And I believe that Mr. Wakefield did just want something simple; lay it out there a nd let’s d o it that-a-way . But there’s two problems here

. No one thoroughly explained -- the evidence is that no one of independent

authority explaine d the fee schedule to him. And particularly Mr. Whise nant, I thin

k, did a g ood job of t

rying to expl ain the f

ee sche dule toMr

. Wakefield, and my notes indicated that he even ran a few numbers for him, but there-6-

was no testimony from any one that there was an explanation of what extraordinary services are or how they

would be computed or how much they might be. Evento the contrary , the evidence suggests that the executors went to Mr. Jonathan Harwell,
an office r with Na tionsBan k Trust Department, or former officer, I don’t know, and
even needed

his assistance to explain how it’s done. And if that’s the case, then Mr. Wakefiel d could have never understood it . . . I feel strongly

that, based on th e evidence I’ve

heard for eight day s, that no one was a ble to expla

in to Lou Wakefi eld what that NationsBank

fee sch edule re ally

meant. And nobod

y’ s been ab le to explain to me when -- when a

service is an extraordinary service or when it’s not, and I ’d like to think I’m of above

averag e intellig ence. Co mbine the extraord inary service s with the fact that you’ ve got -- and I ’m not saying this is improper --but you’ve g ot what I would say

[is] double- dipping: you

have exec

utor’s fe es, dire ctor’s f

ees, you have other fees, it’s ju st so hard to accept the fact that then there c an be a th

ird or fourth
or fifth catego ry of income c alled “extraordinary services,” so I have

a serious problem with that.
The court then found that the Na tion sBank f ee sche dule, which , in l arge part, was premised
on percen

tages o f estate

assets and income, was no longer applicable because Appellants had resigned. The court reasoned:
Since they did resign, it’s impractical to apply the percen tages, and a pe

rcent of this andpercent of that. And that, combined with the lack of independent a d vic e and counsel, both of those together are sufficient for me to state that the schedule is now inapplicable, and I do not, will not award them fee s pursuant to the Nat ionsBank schedule for those reasons
. The cou rt decl ined t o requ ire Ap pella nts t o dis gorge the $50,000 they each ha d previou sly received pursuant to the agreed order r esolving their initial fee re quest, but order ed Mr. Pur sell to disgo rge the sum of

$70,625, p art of fees paid to him for le gal ser

vices to F

WC. Somefactua l backg round is necessar

y a t this point.
Prior to the testator’s death, Mr. Pursell was on retaine r to FWC. Under thei

r arra ngemen t, FWC paid Mr. Pu

rsell a $3,000 mon

thly retaine r for leg al servic es up to fo rty (40) hours. When Mr. Pursell worked m

ore than forty (40) hours in a

month, the corporation paid him at the rate of $100 per hour. Mr. Pursell charged his other clients an hourly fee of $20 0. This arrangement continued after the testator ’s death , appare ntly with the consent of the board of directors of FWC, of which Mr. Pursell was a member.

Mr. Whisenant had a similar retainer arrange ment with the testator. He provided personal accounting and tax planning services to the t estator, and his ac counting firm rec eived a m

onthly retainer from FWC of $4,000 . His firm a udited FWC ’s financial stat ements, b ooks and r

ecords, and providedextensive

manage ment advi sory

service s. At each y ear’s end, the amount of the retainer ($48,000) was compared to the number of hours actually worked and, if it wa s less tha n $48,000,-7-

FWC was given a credit for the following ye ar. The

firm cont inued to pr

ovide ser vices to FWC after testator’s death, again apparently with the con sent o f the three-member board, of which Mr. Whisenant was a member.
The court ’s oral findi ngs explain its reasoning in regard to its order that Mr. Pursell return some of the fees he received under his retainer agreement with FWC after testator’s death:
As for Mr. Pursell’s fee, which I believe was an a

dditional $3,000 per month as the attorney for the corporation -- which I un der stand would be in addition to the director’s fee . . . the evidence did establish that that was an arr angement consistent withwhat he and Mr. Wakefield had while Mr. Wakefield was alive. I t appeared

to be a very r

e asonable agree

ment, and one that’ s not at all

uncommon, particularly among lawyers an d clie nts wh o have a longs tandi ng relations hip. The p roblem is, after Mr. Wa kefield ’s death, a lot of things changed. Not only was the client not there anymore, the a

ttorney was re ally the

client after Mr. Wakefield’s death. Also, the attorney, Mr. Purse

ll, was receiving a co-executor’s fee. Also, Mr. Pursell was receiving a director’s fee. Also, Mr. Pursell’s firm, which rendered valuable service s throu gh partners and other associates, they r

endered services and they ’ve been pa id for those ser vices. With

all of thos e matters considered, it seems unreasonable -- that fee arrang ement of

$3,000 pe

r month to Ron Purse

ll on a re tainer a greem ent, to me appears to be clea

rl y unreasonable, and that entire amount is denied. And to what extent it exceeds whatever else he’s entitled to, must be regorg ed.
The two co-executors contest the court’s rulings. In a cross-appeal, the beneficiaries a rgue that the probate court erred in deny ing their request that additionalfees be disgorged. Becau se this
case was tried in the probate

court wit hout a jur y, t he standa rd of review is de novo upon the record witha presumption of

correctness as to

the findings of fa

ct, unless the preponderance of the evidenc e is otherwis e. Tenn. R. App. P. 13( d); Cross v. City of Memph is , 20 S.W.3d 642, 645 (Tenn. 2000). Furthermore, great weight must be give n to the factual findings made by the trial court that rest on determinations of credibility. Randolph v. Randolph, 937 S.W.2d 815, 819 ( Tenn. 1996) . The presumption of correctness requires us to accept the trial cou rt’s find ings of f act unle ss the ag greg ate weight of the evidence demonstrates that a finding of fa ct other than the one found by the tria l court is more probably true

. Estate of Haynes v. Braden , 835 S.W.2d 19, 19-20 (Tenn. Ct. App. 1992) (holding that an a

ppellate court is bound to respect

a trial court’s findings if it cannot determine that the evidence preponderates otherwise) . To the extent thatthe determination of the issues rests on issues of law, they receive plenary review. Myint v. Allstate I ns. Co ., 970 S.W.2d 920, 924 (Tenn. 1998).6 Although Ms. Sandlin , th e other c o-execut or and co-t rust ee, did not

ask f or addit ional fee s, she “ expect [ed] to receive one-thi rd of whatever co-executors’ fees are approved b y the court. ” At the hearing, Ms. Sandl in’ s posi ti on was clarified : as a be neficiary, sh e ob jected to any additional fees, and she di d not th ink t he co-exec utors were ent itl ed to any addit

ional fees. As a co-ex ecutor, her posi tion wa s that if t he co-executors were awarded addit ional fees, she was enti tl ed to on e-t

hir d.

7 In their res ponse, the bene ficiaries also ques tioned the co ntingen cy fee p aid to Mr. Purcell’s fi rm for handling the wro ngful de ath claim pursu ant to an agreement between the fi rm and the co-ex ecuto rs, includ ing Ap pellan ts, with
no negoti ation with the benef iciaries , under EC 2-20 of the Code of Pr ofessio nal Responsibilit y. These fees were approved by another court in s ettlement of the wrongful death act ion. On appea l, t

he beneficiari es have not raised any issues regarding these fees. -8- I. Th e Compens ation Request
After resign ation by

Appellan

ts and af ter var ious o t her matte

rs were resolve d, the only outstanding issues involved a final accounting by the resigning co-executors, Ap pellants, and their request for additional compensation. 6

The be ne fi ci ar ie s r es po nd ed to th e p et it io n b y assert ing ( 1) th e c ou rt sh ou ld ap pl y a reasona bleness standardto the fees requested; (2) any fee request based on the value of the estate’s corpus must be exa

mined in the context of the resignation of the executors, prior to closing of the esta te, and appointment of a successor executor; (3) the considerations applica ble to professional fees should be applied to executor fees where the prof essional is acting as both executor and lawy er or accoun tant, and that standard is “r

easonab leness” ; (4) it is im poss ible to d etermine what fees NationsBan k would hav e charged in this in stance b ecause it was not u

nusual fo r the ban k to negotia te a deviat

ion from th

e schedu le for la rge es tates; (5) the compensation provision in the will, especia lly when combined with the in terrorem clause as interpreted by Appellants, was beneficial to A ppellants, bot h of whom participated in the drafting of the will and wer e in fiduciary relationships with the testator, with the result that Appellants had the burden of establishing by clear andconvincing evidence that the provision was not the result of undue in fluence; (6) the court should consider the totality of fees and compensation paid to Appellants in their vari ous r oles in relation to testator’s affairs; and (7) because a n excessive fee has been

charged or sought, Appellants were entitled to no fees. The beneficiar ies asserted the fees were excessive a nd unreasonable. 7 Appellan ts replied by

asserting (1) th

ey sought to be paid in accord ance with the ter

ms of the will; (2) the intent

of the testator regarding c ompensation is paramount and must be effectuated; and (3) the on ly issue fo r consideration by the court was the extent of “extraordinary services” which entitled Appellants to compensation beyond the percentage f

e es. Appellants sta

ted they would present to the court “their time records ind icating service s render

ed by them as c o-execut

ors, directo rs, as legalcounsel and accountants, for review and c onsideration by the Court, in making an independent

determination as to whether or not extraordinary services were

perfor med.” They

also described their efforts on behalf of the estate and their a ctivities regardi ng a number of issues, for example, th

e ESOP pro

posal.8 According to an affi davit from a vice presi dent of NationsBank, that ins titut ion bases its fee for ‘ ord in ary’ servi ces on a percent age of t he asset value of the e state and a percentage of t he income received by the estate duri ng administrati on. In addi ti on, t he bank woul d cust omari ly reque st an enh anced f ee ‘ for serv ices rende red b eyond the normal ti me spent by an ex ecutor on an ordinary estat e’, or ‘ext raordinary services .’ According to the s chedule, the admini str ati on char ge i s cal cula ted a t 5% on t he f irs t $100, 000 of

est ate asse ts, 3% on the n ext $300,000, 2% on the next $600,000, and 1 % o n all ove r $1 ,000 ,000 . A fee of 6% is charged on the gross i ncome received during administrati on.

9 Ap pellan ts have ma int aine d on appeal th at var ious i ssues were not properly before t he tri al court. To the extent those asserti ons are based on claims the beneficiaries fai led to raise t hose issues, the response summarized earlier and the sta temen ts of the bene fi ciaries ’ cou nselat t he begi nni ng of

the hearing demons trat e that the benef

iciaries objected to addi ti onal fees on th e var ious bases enumer ated.
-9- The motion for additional fees was amended to re su lt in a final request for an additional $232,303 in co-executor fees. T hat re quest wa s based up on the Na tionsBan k Fee Sc hedule 8 and requested: $120,902 Fee ba sed on the schedule ’s stepped perce ntagesto the gr

oss estate 161,889 Fee based on schedule’s 6% cha rge on income to the estate. 32,820 Fee for sale of real esta te, computed at 3% for broker-assisted sales

________ And 7% on u nassisted sale $315,611

- 150,000 Lessinterim f ees alr eady paid $165,611
29,962 Fees fo r “extrao rdinary service s” by

Mr. Pursell(239.7 hours) 36,730 Fees fo r “extrao rdinary service s” by

Mr. Whisen ant (293. 6 hours)

_________ $232,303 Total additional fees requested
At the beginning of the hearing , counsel for Appellants stated the req ue st was for an additional $165,611; obviously that amou

nt did not include f

ees for extraord inary service s. Appellan ts took the po sition that

there c ould be no

question a

bout their entitleme nt to an additional $165,611 because of the application of the perce ntage computations under the NationsBank fee schedule. During the course of the hearing , Appellants also testified about additiona l servic es, beyond those required in “ordinary” estate administration, for which they claimed $125 per

hour as “extraordinary se

rvices” under the fee schedule.
The bene ficiari es clar

ified the ir position

regar ding the fee re quest, 9 stating , in part:

We think that there are issues before the Court that [counsel for Appellants] intends to explore

fully and we certainly

intend to explore fully . The use of a fee schedule in conjunction with the in terrorem clause we believe wa s a conflict of interest. The pursuit of the sa le a conf lict - - of the

ESOP trust we believe was a conflict of interest

. We think there were multiple billings and fee arrangement s betwe en the parties and various entities which they controlled, as a result of their fiduciary10 Although there is some indication in t he briefs t

hat the direct ors were paid $300 0 per month, the testi mony shows that

they receiv ed $125 per hour for t heir s ervice s. They invoic ed F W C for amo unts ov er the $ 300 0 mo nthly total. The amo unts set out above were taken from a chart prepared by the beneficiari es. Appellants were quest ioned about the fi gur es a nd di d not

dis put e t hem.

11 Th ose fee s are no t in dispu te. Also not in d ispute, a nd we think no t fairly attribut able to Mr. Purs ell’ s fees for purp oses o f this discussion, is the payment to M r. Pursell’ s firm for their s uccessful workin the wrongful death action. -10- positions and wit

hout there be

ing any check o r balanc e, parti cularly

with reg ard to payment of direct ors’ fees for a company for which they

were directors. We think that in total the fee requ es t is excessive commensurate with the work done and the value provided, and then also in connection with theto ta li ty o f the fees being assessed.
The proof at

the hear ing prov ided deta ils of the t

otality of feespaid

to App ellants for the several fiduciary positions du r ing the a

pproximate

ly th irty months from the testa

tor’s de ath in Decemb er 1994 until their resign ation as c o-execut

ors, co-trustees, and company directo rs, in late June of 1997. During that period, Appellants and their firms were paid a total of $623,114 for their services in several capacities : e xecutors and trustees, directors of the company , attorney and accountant

for the estate, and attorney and accountant for

the company. Mr. Pursell or his firm wa s paid a total of $311,707. Mr. Whisenant or his firm received a total of $311,407.
Eachwas paid $50,000 in executo r and trustee fees in accordanc e with the agreed order approving the initia

l interim f

ee requ est. In a

ddition, e ach rec eived sub stantial p ayments for their services as directors of

FWC, with Mr. Pursell being paid $135,232, and Mr. Whisenant receiving $123,684. 10 Mr. Pursell’s firm was paid $26,683 for its services as counsel for the estate until the firm’s resign ation in Ma

y 19 96. Mr. Pur sell was p aid $90,0 00 under his retainer arr

angeme nt with FWC, at $3,000

per mo nth fo r thirty months. Mr. Pursell’s law firm was pa id another $9,792 for services to FWC on an hourly basis, appare ntly outside

the reta iner ar range ment. 11 Similarly, Mr. Whisenant’s firm received $55,113 for accounting services provided to the estate and $82,610 for such services provided to FWC.

In Appellants’ submissions and at the hearin g, Mr. Pu rsell tes tified and presen ted time records reflecting that he had expended 475.9 hours asco-executor “ove r and abo ve any

time spent as a member of the Board of Directors or for legal services provided

to Feldkircher Wire Fabricating Co., Inc.” As indicated above, Mr. Pursell considered 239.7 of those hours to have been spent on extraordinary

services. Similarly, Mr. Whisenant testified that he spent 496.3 hours on co-executor duties, as o pposed to duties of his other roles, and 293.6 of those hours were for extraordinar y service s. The court’s specific rulings were :
1. Because of the complexities of the fee schedule and

the court’s conclusion that the testator
never understood those complexities, and because of the difficulty in justifying fee s for12 Th e cou rt found that M r. W akefield had not re ceived an expl anat ion of “wha t ex tra ordin ary ser vice s ar e or how they would be computed or h ow much they might be” and that

the t estat or did not u nderst and that aspect of

the f ee schedule, The trial court later st ated, “But I feel str ongly t hat, based upon the evidence I ’ve hear d for ei ght day s, t hat
no o ne wa s able to expla in to Lo u W akefield what tha t Natio nsB ank fee sched ule rea lly mean t.”
-11- “extraordinary

service s” as exec

utors in view of the other fees charg ed, the court denied that portion of the fee reque st for extr aordina ry service s. 12

2. The per centage fee sch edule ty pe of ar range ment cont emplatesthe execu

tors will c omplete the administration of the estate. Because Mr. Pursell and Mr. Whisenant resigned before

the esta te was settled, application of the percentages in the f ee schedule was not practical. For that reason, and because of the la ck of inde pendent a dvice to the testator regarding fiduciary compensa tion, the court determined the fee schedule was inapplica ble and refused to award fees using that schedule.
3. In response

to the beneficiari es’ cha

llenge to the atto

rney ’s feesof $3000 p er month p aid to Mr. Pursell for servi ces to the corporation, the court determined that the monthly retainer fee arrangement

was clearly

unreasonable because Mr. Pursell, as director, was the client as well as the at to rn ey, because Mr. Pursell was also receiving a director’s fee, and beca

use Mr. Pursell’s firm was paid for legal services outside the retaine r. The court denied the entire retainer fe e amount and required repay ment of a ny a mount exce eding “ whateve r else he ’s enti tled to.” Based u pon time records for hour s actually s pent by Mr. Purse

ll in providing legal

services to FWC, that amount was determined to be the $70,625 requested by the beneficiaries as exceeding the va lue of the services rendered.
The court also made clear it was not disturbing the previously a warded interim f ees, but h eld that the $50,000 each of the co-executors rece ived pursuant to that agreed order “ wou ld be the entirety of their c o-executors’ fee.”

II . The Trial Court’s Authority Ove r Executor and Trustee Fees

We begin our analy sis with disc ussion of t he general fr

amework for cons ideratio n of requ ests for compensation for executor and trustee services. Genera lly, executor s are en

titled to r easonab le compensation for

their services and to pay

ment for reasonable expenses incurred in g ood faith for the necessary

benefit of the estate. In Re Estate of Wallace , 829 S.W.2d 696, 700-01 (Tenn. Ct. App. 1992); see Tenn. Cod

e Ann. § 30 -2-606 ( 1996). Th e deter mination of

reasona bleness is left, in the first insta nce, to th e discre tion of the

trial cou rt, which is to make that determination in light of all the releva nt circumstance s. Id . at 701; In Re Esta te of Griffi th , 452 S.W.2d 895, 902 (Tenn. Ct. App. 1969). Thus, whe

re the will is silent r

egard ing comp ensation

for an e xecutor, “the execu

tors shall be credite d with a re asonable compensation” as determined by the court. In Re Esta te of Perl berg , 694 S.W. 2d 304 , 307 ( Tenn. Ct. A pp. 19 84) (q uoti ng Leach v. Cowan , 125 Tenn. 182, 195, 14 0 S.W.1070, 1074 (1911)).13 Th e pr imary holding in Perlberg was that a wi ll which provides t hat no compensation will be paid the
execu tor prevails over the statut e, and, in t hat sit uation, the execu tor w il l not recei ve eve n rea sonabl e compens ati on for necessary service s. Id . at 306-307. “We, therefore, hold the Appellant’s contentions t hat estat e representatives are enti tled to be pa id as a mat ter of law, even where the wi ll provides to t he contrary, i s without

merit.” Id. Perlberg did not invol ve a situat

ion where the executor asse rted entitlement to paym ent under the will regard less of reasonab leness.

14 See f ootnot e 13.
-12- Where, however, the testator has established the compensation of the executor, generally our courts will give effect to the testator’s intent to the extent it is ascertainable.

In Tenness ee and in

virtually every other jur isdicti on that has addressed the issue, where a will specifies that an e xecutor is to receive a certain amount as compensation, or no compensation, for servingas an executor, he, by accepting the appointment, binds himself to the will’s terms.

In Re Esta te of Perl

berg , 694 S.W.2d at 306. 13 This rule is based upon the paramount importance given to the testator’s intent. In Te nnessee, “[t]he cardinal rule for interpreting a nd const ruing a last will and testament is the ascertainment

of the i ntent of the testator. That intent, when known, will be given effect unles s pro hibited by some rule of law or public policy.” In Re Walker , 849 S.W.2d 766, 768 (Ten

n. 1993); Cowden v. Sovran Bank/Ce ntral South , 816 S.W.2d 741, 744 (Tenn. 1991). So, the clea r intent of

the testa tor will g overn un

less it is “prohibited by some rule of law or public policy.” Id

. Winningham

v. Winningham , 966 S.W.2d 48, 50 (Tenn. 1998). Our law makes it clear that the testator’s intent is “of paramount importance.” Id. We must ascertain the testator’s intent from the particular word s use d in the wil l itself, f rom th e con text in which those words are used, and from the general scope and purposes of the will, read in the light of the surr ounding and a

ttend ing circumst ances; Moore v. Neely , 212 Tenn . 496, 502- 03, 370 S.W.2 d 537, 540 ( 1963); see also Th ird Nat’l Bank

of Nashvill

e v. First Am. Nat’l Bank of Nashville , 596 S.W.2d 824, 828 (Tenn. 1980).
Based on these general

principle s, as well

as more s pecific

authority from othe r jurisdictions, Appellan ts assert that the trial court was required to approve

the requ ested ad

ditional f ees bec ause the tes tat or e st abl is hed th e co mp ens ati on f or t he e xe cut ors in th e wi ll . In essence, they argue that the court had no authority to inquire into the reasonableness of the fees or to substitute its judgment of reasonable compensation for that of the testator.

Even assuming that Appellants’ interpretation of the gene ral rule is correct, 14 we do not bel ieve that rule

prohibite d the tria

l court fr

om making

the examina

tion of the

facts an d circumstances it made. F

irst, although Appellants equate the will’s direction that the executors and trustees “be paid fees equal to those fees customarily charged by

NationsBank . . . for esta

te and tr ust15 Otis Go odin , Natio nsB ank V ice P reside nt and trust officer , confirm ed his p rior affid avit t es timony stat ing, “the fee s chedule i s intended by Nations Bank as the fee to be charg ed. H owe ver, it woul d not be unus ual in e sta tes of $5,000, 000 or more that the amount

based on the fee s chedule woul d be negoti ated and fee concessions made bas ed on circums tances where app rop riate.” Add itionally, there is an affi davit of T . Richard T ravis, a former trust offi cer and vi ce president of Nat ions Bank and i ts pr ede ces sor s, C&S Sovr an Ban k an d Commer ce Uni on Bank , s tat in g, “i t w as my experien ce at NationsBank (and its predecessor banks) that i n setti ng fee s f or ver y l arge est ates ($10,000, 000 or more in gross assets ), it

was n ot un usua l f

or the exe cutors ’ f

ees to be n egotia ted wit h the bene fici aries usin g the publ ished f ee schedule s as a guideline. In those cases t he Bank would co nsider making concessi ons and reduci ng fees in cer tain areas as seem ed ap pro priate under the circumstances.” F inally, M. Kirk Sc obey, Jr., Exe cutive Vice P resident and S enior T rust Office r of E quitab le T rust Co mpa ny, subm itted an a ffidavit to the same effect.

16 In addition, a guardi an ad l it em for one of the minor

benefi ciaries point ed out a not her iss ue rais ed by the affi davit s, sta ti ng:

So if there had not b een a con flict of in terest, the a tt orney would ha ve gone t o Nati onsBank and sai d, “What would you have settl ed this estate for,” and he would have g o tt en a wri tt en st atement . And I thi nk it would be les s than t hat, and I think we have affi davits here today that show this is t rue. -13- administration services” to language adopting the fee schedule, there was affidavit testimony 15 to the effect that bank trust dep artmentscustomar ily d epart f rom their printed f ee schedules and

negotia te other fee arrangements whe

re large estates are

involved. 16 A probate court has authority to determine the intent of the testator and, t herefore , to examine

whether the testa tor’s wor ds “custo marily charged” indicated an intent to adopt the f ee schedule per se. Second, even if t

he testa tor intend ed to adopt the fee

schedule , that schedule

is subjec t to interpretation, particularly on the issu e of wha

t constitut e s “extrao rdinary ser

vices” allowing charge s in addition to the standard percentage fee. The trial court determinedthat the te stator wa s not fully andindependently informe d about the meaning of that pro vision of the schedule. T he proba te court’s responsibility to interpret and apply the testator’s intent required the court to inquire

into the nature of “extraordinary

service s” and the ty

pes of se rvices p rovided b y A

ppellant s herein

in their various roles aswellas t hei r co mp ens ati on f or t hos e se rvi ces . In fact, Appellants maintained at the beginning of the hearing that the court’s only role was to determinewhether extraordinary services had been performed, and the extent of compensation appr opriate for such services.

T he executors claimed hourly f iduciary fees for “extraordinary services” under the fee schedule while at the same time performing ot her prof essio nal services for the estate and the company and receivingcompensation for those services. Thus, fiduciary services and professional services and advice w ere b eing provided by the same people, and questions of whether particular services were being provided as a fiduci ary

or as a pr

ofession al were

being a nswere d, in the f

irst instance, by those same people . Without court review, there would be no independent judgment regarding those ans wers. Because fiduciaries owe a duty of loyalty to the estate and a duty of good faith dealing to the beneficiaries, In Re Estate of Wallace , 829 S.W.2d at 705, the court may inquire into the exercise of the fiduciaries’ discretion.17 The will made no p rovision for succe ssor executo rs or trustees. -14- Third, the trial court was asked to apply the fee schedule, which Appellants arg ued was the intentof the testator, to a situation unforeseen by the testator: resignation

of the co-executors before administration of the estate was complete. 17 The fact that the trial court encourag ed that resignation, as the court candidly

acknowledged, does not alter the consequence.
Where a trustee ceases to be trustee before he has completed the administration of the trust, he is not entitled to the full compensation to which he would be entitled if he hadfully administered the trust. . . . In such case, the court will award to the retiring trustee or his esta

te such compensation as is reasonable under all the circumstances for the services that he has performed . . . .

In the exerc ise of its disc

retion in determin ing the a mount of c ompensat

ion to be pa

id to a trustee

who has c eased to be trus tee bef ore the a dministra tion of the

trust is completed, the court

may cons ider how nearly the trustee has completed the administration of the trust, what services he has render

ed, and w hat services re

main to be rendered. . . .
There are nume

rous cas es in

which the courts have applied the rule that the trustee who has ceased to be t

rustee w ithout having fully administered the trust is entitled to such co mpensatio n as is reasonabl e under the circumstances.
A UST IN W AKEMAN S COT T & W IL LIAM F RANKLI

N F RATCHER ,T HE LAW OF T RUSTS § 242.11, at 311-1 2 (4th ed. 1988) (emphasis added).
Si mi la rl y, when an e

xecutor r esigns, and that r

esigna tion is app

roved by the cour t, the court will order settlement by the executor. Tenn. Code Ann. § 30-1- 112. Such a s ettlemen t is “imperative.” 2 J ACK W. R OBINSON , S R

. & J EFF M OBLEY , P RIT CHARD ON THE LAW OF W ILLS AND A DMINI STRAT ION OF E STATES § 620, at 139 (5th ed. 1994). Any settlement includes appr oval of fees to the resigning executor. Where an executor pe rfo rms partial ly, compensation should be set proportionately or on a

quantum meruit basis. 6 W IL LIAM J. B OWE & D OUGLAS H. P ARKER , P AGE ON THE LAW OF W ILLS § 57.14, at 359 (3d ed. 1962). We agree with the trial court that the resignationof the co-executors and co-trustees before completion of administration of the estate or settlement

of the trust authorized the trial court to determine and award rea sonable fees for executor and trustee services provided prior to resigna tion regardless of the method of compensation established in the will.

II . Confide ntial and Fiducia ry Relations hips
While we find the trial court’s inquiry into the reasonableness of compensation received and requested by Appellants to be justified on the bases set out above, it is apparent that the heart of the trial court’s ru lin g rests in another set of principles. The trial court’ s findings and the inquiry18 The cases Appell ants c ite, which emphas ize the impor tanc e of t he t est ator ’s int ent regar ding the amount of compensa ti on exec utors re ceive , do n ot invo lve situatio ns whe re the b enefit of a specif ied fe e arrange ment goes to the attor ney who drafted the wil l an d is als o act ing as an execu tor a nd dir ector of a corpor ati on whi ch i s t he major ass et of the estate. See, e .g. , In re Est ate of Louts ion , 496 A.2d 12 05 (Pa. Super. 198 5). The authori ties the benef iciaries cite for the proposi tion t

hat t he probate court may ex amine execu tor’ s fees for reasonableness do not involve si tuations where the will states the me thod for calc ulating the fees. See e.g., Estate of Cuneo , 475 S.W .2d 672 (T enn. Ct. App. 1971) (no provi sion in will setting ex ecuto r’s com pen sation) ; In Re E st at e of Gr iffith , 452 S. W.2d 895 (Tenn. Ct . App. 1969) (sam e); Young v. Phi ll ips , 93 S. W.2d 634 (Te nn. 19 36) (same ); In re H ick’s E state , 510 S. W.2d 263 (Tenn. Ct . App. 1972) (there w as no will). Underwood v. United States , 407 F .2d 60 8, 610 (E.D. T enn. 196 9), is distinguishable beca use in that case the executors were permitted to renounce the compensation provisions of the will and accept the statut ory fee. This was because the will “was no t suscep tible of re ason able int erpreta tion. ” Underwood , 407 F.2d at 610. T he executors conditioned their appointment on abrogation of the test ator’s compensation li mitation. -15- preceding those findings were based, primarily , on the court’s concern with the multiple roles filled by Appellants and with Appellants’ relat ionships tothe testator, the corporation, and the estate. Those roles and relationships justify the trial c ourt’s examination of the reasona bleness o f the re quest for addi tional fe es. A. Relationships with Testator
Whil e we find n o Tennes see law p recisely o n point with

the fac ts befor

e us, 18 we fin d persuasive, in light of Tennes see aut hority in other s ituations, discusse d below, t he holding

in Andrews v. Gorby , 675 A.2d 449 (Conn. 1996). In tha t case, t he draf ter of the testator ’s will and its codicilswas named executor an d tru stee. Codicils provided for the executor’s compensation as follows: “the executor . . . shall be entitledto compensation in accordance with fees then pa yable for Estate Settlement services as published by said UN ION TRUST COMPANY in its then effective Personal Trust Fee Schedule . . . .” Gorby , 675 A.2d at 452. This fee schedule, which was similar to the sche dule relied upon b y A ppellant s in the ca se before us, calcula ted the e xecutor’ s fee asa percen tage of the estate’s valuation for federal e state tax purposes. The drafter admitted that he had notdiscussed the potential magnitude of his executor’s fee with the testator. Af ter the testator’s death and the administration of the estate, the drafter “claimed the full executor’ s fee pursuant to the Union Trust schedule.” Id. at 453. When the probate court declined to award the dra f ter the full amount he sought, the ap

pellate courts were faced with the issue we presently g

rapple with: whether the probate court was “boun d by the direction of the testator in a will prepared by the named executor.” Id. The Gorby court answered that question in the negative. I t reasoned:

We begin our

analy sis with the

fiducia ry relation ship betwe

en the la wy er who dr

afts the will and the testato

r. This relationship falls within the attorney- client sphere, and thus rai ses the conc erns ty pically found in th at area . “The ju dicial sy stem has a sign ificant

interest in regulating attorney s and the attorney -client relationship. . .

. In so doing, courts have been mindful tha

t the rela tionshipbetween an attorney and client must involve personal integrity and responsibility on the part of the lawyer

and
an equal confidence and trust on the part of the client. . . . The relationship between
an attorne y a

nd his c lient is highly fiduciary in its nature and of a very delicate,-16-

exact ing, and confidential character , requiring a high deg ree of fidelity

and good faith.”
This fiduciary r

elationship has always dem anded a high degree of scrutiny. For example, we have

held withrespect to the attorney -client relationship in general that “[p]roof of a fiduciary

re l ationship therefore imposes a twofold burden upon the fi du ci ar y. Once a [fiducia ry ] relation ship is fou

nd to exist, the bu

rden of p roving f air dealing proper ly shift s to the fiduciary. . . . F urthermore, the standard of proof for establishing fair dealing is not the ordinary stan dard o f fair preponderance of the evidence, but requires proof . . . by clear and convincing evidence . . . .”

. . . While thes e events [surrounding the will preparation] may reflect a well placed trust, and even though in this case the plaintiff assumedthese fid uciary duties ag ainst his wishes at the testator’s insistence, the fiduciar y relati onship is the ove rriding consideration

. Further, althoug

h ostensib ly th

e plaintif f was not a

beneficiary

under the

will, compensa tion in exce ss of that w

hich is re asonable

is, in the words of the Superior Court, “the functional equivalent of a bequest to the plaintiff .” If the testator had wanted to make such a

bequest t o his attorney who dr

afted the will, he would have
so providedin the will. Therefore, we conclude that the testator intended to provide a measure of reasonable compensation for the executor , and not a bequest.
We conclude that, as a matt er of public po licy, an at

torney who dr

afts a will that names the attorney as executor an d contains a fe e schedule

for his compensation as executor is limited to reasonable com pensation, irrespective of theschedule. We note, however, that a testator may have a reasonable expectation that such a fee schedu

le estab lishes a

maximum limit on executor’s fees. Therefore,
a reasona ble fee may

not exceed the amount provided in such schedule. Further, the burden rests o n t he attorney to pr ove the reasonableness of the compensation requested by

a preponderance of the evidenc e. Gorby , 675 A.2d at 453-54 (emphasis added) (citations, parenthetica ls and footnotes omitted).
Neither the conc lusio n nor the language used by the Gorby court is new to Tennessee jurisprudence. Owing to the con

fidentia l and fidu ciary

relation betwee n an attor ney and his cl

ient, andto the influence of the attor neyover his client, growing out of that relation, Courts of law, and especially of equity, scrutiniz e most cl osely all t

ransacti ons between an attorn e y and his cl ient . To sustain a trans action of advanta ge to himself with his client, the attorney has the bur den of showing, not

only that he used
no undue influence, but thathe gave his client all the information and advice whic h19 The record shows that Mr. W hisen ant, the t estat or’s a ccountant , als o advised t he t est ator regarding the executor ’s f

ees. Al though Mr. Whisenan t did not actual ly dra ft t

he wil l, t he record sh ows tha t he had agr eed t o be an execu tor and was enmes hed i n advi sin g th e te sta tor abou t t he appr op riate method of determining the ex ecutor’s fees, includ ing fee sc hed ules use d by ins titutional trus tees. -17- is (sic) would ha ve been hi s duty to give if he himself had not been interested and that the transaction was as beneficial to the client as it would have been had the client dealt with stranger.
Waller , Lansden, Dortch, & D avis v. Haney , 851 S.W.2d 131, 131-32 (Tenn. 1992) (quoting Hutchinson v. Crowder , 8 Tenn. Civ. App. 114, 119 (1917)) (emphasis added). An attorney

enjoy s a confi dential r

elationsh ip with his or her client which triggers judicial scrutiny for fair ness of a transaction wher

ein the c lient best

ows a benefit

on the attorney. Hager v. Fitzgeral d , 9 34 S. W. 2d 66 8, 67 1 ( Te nn . C t. Ap p. 19 96 ). Si mi la rl y,
We are of the opinion that the rela tionship be

tween a n accountant and

his employer is analog ous t o the rel ationship betwee n an attor

ney and his cl

ient. I t is highly fiduciary in its natur

e and of a

very delicate , exacting , and con fid ential c haracter, requiring a high degre e of fidelity and g ood faith. It is purely a personal relation, involving the highest personal trust and confidence

. Federal Ins. Co. v. Arthur Anderson & Co., 816 S.W.2d 328, 330 (Tenn. 1991) (citations omitted). 19 A party who mana

ges the financi al affa

irs of an other ha s a confi dential r elationsh ip with that person. Nicholas v. Wright , 42 Tenn. App. 241, 245, 301 S.W.2d 540, 542 (1956).

It is well settled law in Tennessee that where the facts show “the existence of a confidential relationship, followed by a tra nsaction wherein the dominant party receives a benefit from

the other party, a pr

esumption of

undue influence arises, that may be rebutted only by

clear and convincing evidence of the fairness of the transaction.” Matlock v. Simpson , 902 S.W.2d 384, 386 (Tenn. 1995). Therefore, the existen

ce of a c onfident

ial rela tionship be

tween the testa tor and his attorney and accountant

at the time the will was dr afted an d executed, combined with the appointment of the attorney and accountant as fiduciaries created a situation which authorized the trial cour t to inquire into the compensation of the fiduciaries who were c laiming the benefit of a will provision settin g compensation.
The presumption arising from a beneficial transac tion between parties in a confi d ential relation ship can be rebutted, and fairness of the tra nsaction shown, with proof that the donor received i ndepend ent

advice. Hogan v. Cooper , 619 S.W.2d 516, 519 (Tenn. 1981). Independent advice
means that the advisor must be competent to provide the advice and so disassociated from the interest s of the party r

eceiving to benefit to be able to advise impart ially. Tur ner v. Leather , 191 Tenn. 292, 297, 232 S.W.2d 269, 271-72 (1950). Thus, the trial court’s referenc es in the case before20 W e note the be neficiaries raised the issue in their response to the petition for add itional fees.

21 In Petty v. Priv ette , No . 03A 01-9 102 -CH -000 84, 1 991 W L 20 025 2, at *3 ( Te nn. Ct. App. Oct. 9, 1991 ) (no Tenn. R. App. P. 11 appli cati on fi led) , this court lat er he ld

Bec ause of the confidenti al relat ions hip b etween the dra fting attorney and the testator, there is a rebu ttable presumption that the clause bene ficial to the attorney was the resul t of the at torney’s undue inf luence on th e te sta tor, and t he bur den of rebu tting this pre sump tion rests w ith the attor ney. In the instant case, the t

rial court he ld tha t th is bur den of proof mus t be met by clear and convinc ing evi dence

. . . . Although the cl ear and convi ncing s tandard has been rel axed in s ome circumst ances, we ar e convinced that the cle ar and conv in ci ng st andard of proof is t he bett er rul e in s itu ations where an attor ney in his capacit

y as executor may benefit from an exculpatory clause whi ch he or a member of his fi rm has draf

ted.

Id . at *4 (citatio ns om itted).

-18- us to th e absence of independent advice indica te that the trial court was concerned with the presumptions arising from transactions between those in a conf idential relationship. Appellan ts adamantly maintain there was no allegation

of undue influenc e inthe making of the testator ’s will, 20 which we interpret as an a rgument tha t the issues raised by the e xistence of a confidential relationship were not properly before the c ourt. We respectfully disa gree. We are awar

e that the cases involving a confidential relationship between a testator and someon e who be nefits from a w il l g en er al ly involve the question of whether the specific provision of the will was the product of undue influence. However, we think the underlying principles and policy

concerns justify the court’s scrutiny of

the consequence and effect of the testator’s disposition of a benefit to a person who had a

fiduciary r

esponsibility to the testator at the time of making of that disposition. As the Connecticut

court sa id inGorby , and as Tennessee courtshave sai d, it is the fiducia ry relation ship which is the overriding consideration and which demands a high degr ee of scrutiny

from the cour ts. Therefore, althoug

h the tria l court ma

de no find

ing that the testa tor was unduly

influ enced in h is decision to include

the compe

nsation pr

ovision in h

is will, the

court wa s within its a

uthority to scru tinize the tran saction a

nd its result to d

etermine their fa irness a nd reaso nablene ss, including the effect of application of the fee sc hedule to the estate.

In P etty v. P rivette , 818 S.W.2d 743 (Tenn. Ct. App. 1989), this court determined that the presumption arising from a confidential relationship attached to a clause “beneficial to” the attorney who drafted the will at issue. Id . at 746. That beneficial clause relieved the executor, who was the drafting attorney, fr

om liability for any

act or omission as executor or trustee. Because the trial court hadfound that the exculpatory clause w as unenf

orceab le as a

matter of law, this court remanded the
case to give t he attor ney the oppor

tunity to prese nt proof to re but the presumption and for further evidence “as to undue influence, overreaching , or any abuse of confidential relationship,” with the burden on th e a tt or ne y. 21 Id. at 748. The court held that an attorney may benef

it froman exculpatory clause, in a wil l draf

ted by him self o r his firm, i f the at torne y proves t here wa s no ov erreach ing,22 By the ir pos it ion a s co- tru ste es, the y ar e al so a majori ty of the bo ard o f directo rs of the c orp oratio n which is the principal asset

of the tr ust. I n tha t rol e, t

hey w ere abl e to ma ke hi rin g and compe nsat ion de cis ions forprofess ional
s ervice s for t he c orporation. As a majority of t he co-executors, they were able to make similar decis ions regarding profess ional servi ces for the es tate

. -19- undue influence, or

abuse of the fiduciary

relationship. Id. at 747-48 . The cou rt also qu oted with approval the following languag e from a Massachusetts case: Any transaction between an attorney and his client when called in question must be subjectedto careful scrutiny and the burden is upon the attorney to prove that any influence over the client which might be presumed to have ar isen out of the relation ship was neut

ralized by in de pendent a

dvice given to the

client or by s ome other means so t

hat the re was no overreaching of the client and no abuse of confidence.
Id. at 747 (quot ing Barnum v. Fay , 69 N.E.2d 470, 473 (Mass. 1946).

We think the provisions of the testator’s will herein were beneficial to Appella

nts in the same way the exculpa tory cl ause was beneficial to the executor in Privette . Appellants have taken the position that insertion of the method of compensation removes executor fees fr om a reasona bleness analy sis by t he co ur t, ce rt ai nl y a benefit to executo

rs. 22 In addition, they

asserted that any

beneficiary who sought to question the awa rd of fe es under

the fee schedule was subject to disinheritance under the in terrorem clause. They ar e, consequently, har

d pressed to deny a

n intended benefit from the langua ge in the will. In addition, like the court in Gorby , we find no intent by the testator to pay the co-executors more than an amount that is reasonable. Finally, it is well-settled that
If the settlor fixed a r ate of compensa tion for th

e trustee which wa s extrava

gantly high, andif the trustee was influential in obtaining the insertion of this clause in the instrumen t, the court will requirethe tru stee to pr ove the ut

most fair ness in his negotiations on the subj ect. Unle ss the trus tee coul d establis h that ther e was no undue influence, fraud , or duress upon the settlor, and that the settlor acted in de pe nd en tl y, and afte

r full disclosure of his rights and of the legal situation about compensation, the co urt will set aside the provision and require the trustee to be content with a sum fixed by the court or with the statutory fee.

B OGERT , THE LAW OF T RUSTS AND T RUSTEES , § 976, at 145 (2d ed. Rev.) (1983).
These authorities, and the principles underlying them, make it clear that the trial court had the authority and re sponsibility to inquire into the com pensatio n provision and into the
reasona bleness of the requested comp ensation. We agree with the trial court that the burden of establishing the fairness of the compensation provision, or the fairness of the compensation itself,-20-

in view of the totality of circumstance s, lay with the fiduciari es cl aiming benefit fro m the will. We affirm t he trial c ourt’s decision to a ward App ellants on

ly r easonab le fees

. B. Fiduciary

Relationships After Death of Testator

In addition to

the conf idential r elationsh ips existing

betwee n the testa tor and hi s attorney

and the tes tator and hi s accountant at the time the will was drafted, Appellants assumed additional fiduciary responsibi lities up on probate of the will. First, they were appointed co-executors of the estate and co-t rusteesof the te stamenta

ry trust. Under principles well-established under Tennessee law:

Executors , as fiduc iaries, owe a dut y of undivided

loy alty to the estate and must deal withthe beneficiaries in the utmost good faith. Mason v. Pearson , 668 S.W.2d 656, 663 (Tenn. C t. A pp. 1984) ; In re Cune o’s Estate , 63 Tenn. App. 507, 515, 475 S.W.2d 672, 676; Baker v . Baker, 24 Tenn. App. 220, 24 0, 142 S.W.2d 737, 750 (1940). P art of thi s duty

includesincurring only

those expe

nses that are re asonably necessary for the proper administration of the estate. In re Estate of Wallace , 829 S.W.2d at 705 (citations updated).
Si mi la rl y,
The most fundamental duty owed by the trustee to the beneficiaries of the trust is the duty of loy alty . This duty is imposed on the trustee not beca use of any provision

in the terms of the trust but

because of the relationship that arises from the cr eation of the trust. A tr

ustee is in

a fiduci ary

to the beneficia

ries of th e trust. . . . I

n some [fid uc ia ry] relation s the fidu ciary element i s more i ntense th an in othe rs; it is peculia rly intense in the case of a trust. I t is the duty of a

trustee to ad minister the trust solely in the interest of the bene ficiaries. He is not permitted to place himself in a position where it would be for his own benefit to violate his duty to the benefic iaries.
S COTT & F RATCHER , supra , § 170, at 311.
A trustee m

ust exercise his or her discreti on ingood faith. Krug v. Krug , 838 S.W.2d 197, 201 (Tenn. Ct. App. 1992). “The trustee’s discretion must be exercised in a reasonable way . ‘He must do what his honest, disinterested, judgment approves or ought to approve .’” Alexande r v
. Nelson , 825 S.W.2d 106, 108 (Tenn. Ct. A pp. 19 91) (q uoti ng Cansler v. Unknown H eirs of Chai rs , 35 Tenn. App. 631, 635, 250 S.W.2d 579, 581 (1952)).
Prior to hi s death, the testator was the sole shareholder, sole director, president, and chi e f executive officer of F e ldkirche r Wire Fa

bricating Compan

y, I nc. By the termsof his will, his residuary estate, including his shares in FWC, became an asset of the Wakefield Family Tr

ust. The23 An audit re por t indicate s the sha res of sto ck we re held by the E state of M .L. W akefield ; the will wo uld ind icate

they were held by t he Wakefi eld Fam ily Tru st. In either e vent, the co-ex ecuto rs and co-truste es had the sam e duty regar ding the mana gem ent of the asset. -21- trust was to be terminated within eleven ye ars of the testato

r’s dea th, and the

trust assets distributed to the beneficiaries, except that portion for the benefit of the minor beneficiaries. Thus, the company was the ma

jor asse t of the tr ust crea ted under the will. 23 The will further provided:
I direct the

co-trustees to continue to operate the corporation known as Feldkirc her Wire Fabricating Company , Inc. I direct the co-trustees t o design ate Judith Wakefield Sandlin, R.H. Pursell and Robert V. Whisenantas the Board of Directors of the corporation. Furthermore, I specifically a

uthorize the direc tors to s ell the corporationif the directors in their absolute and unlimited discretion d eem it to be financially advisa

ble. Thus, the will dir

ected the co-tr

ustees to operate the company. The

fact that they a

lso served
as directors of the company does not remove their actions from scrutiny by the court with jurisdiction
over the estate. The probate court had jurisdiction over appointment and removal of the co-t rustees , Tenn. Code Ann. § 35-1-101, and over examination of an accounting by a resigning trustee, Tenn. Code Ann. § 35-1-107.
The various roles assumed by Appellants, and potential compensationfor each role, created
a situation w

herein the fiduciary

was required to make decisions which could potentially benefit the fi du ci ar y. As the trial court observed, the attorney -client rela tions hip be

twee n Mr. Purse

ll and FWC
was fundamentally cha

nged by the death of Mr. Wakefield. As a director, Mr. Pursell was the client, andas a fiduciary

had to exercise independent judgmen t in the selection and compensation of legal service provider s. The sa

me is true regar ding Mr. Whisenant

and acc ounting s ervice s.
Becau se of the fiduciary

duties imposed upon Appellants by virtue of their status a s coexecutor s, co-trustees, and directors, the court had the authority to closely

scrutinize any transaction wherein the fiduciary

decided to hire himself. With regard to transactions betwee n an attorney and client, Tennessee courts will “scrutinize most closely ” all such transac ti ons. Waller, Lansden, Dortch, &

Davis , 851 S.W.2d at 131.

In this situation, the court has authority to examine the fiduci aries’ pe rforman ce and it s consequences to the estate and the beneficiaries. Additionally , the burden of establishingfairne ss in the transactions pro perly fa lls to the f

iduciar y, e specially w

here, a s here, t

he beneficiari es raise the issue of the reasonableness of the overall compe nsation.
C. Court Examination of All Fees Received by F iduciar ies for Re asonable

ness
For all the reasons set out above, the probate court had a uthority to examine the fees paid to,
as wel l as requ est ed by, the fiducia ries whose appointment and resignation were a pproved by the24 Ap pellan ts ass ert tha t an y f

ees pa id t o the m for their act ivi ti es as dire ctor s of

FW C or profess ional advisors to FW C o r the esta te “are irr eleva nt t o the det ermination of t he Executors ’ f

ee owed pursuant

to th e NationsBank f

ee schedule .”
-22- court. This examination did not require a finding of undue influence or any bre ach of duty. No suc h fi ndin gs were mad e, and our holding do es no t car

ry any impli cati on the

re wa s suc h con duct . We merely hold thatin the factual circumstances presented, the f ees to be received by

co-executors and co-trustees of a testamentary trust are subject to the scrutiny of the probate c ourt which ha s the authority to overs ee the performance of those fiduciaries. The probate court determined the fiduc iarie s herei n were e ntit led to reason able co mpens ation , and w e affir m that hold ing.

II I. Reasonableness of F

ees
A. Executor and Trustee Fees Having determined that

the trial court acted within

its authority in examining the request for additional fees and in awarding rea sonable fees, we now review the court’sdetermin ation as to the amount of reas o nablefees. Whe n a court sets a re asonable

fee for a trustee , it should ta

ke into account “the size o f the trus t, the nat ure and n umber of the asse ts, the income produced, the time and responsi bility required, the expertise required, any management or sale of real estate and closely held business inter ests, anyinvolvement in litigation to protect the trust property , and other relevant factors.” Tenn. Cod

e Ann. § 35 -1-112. S imilarly , reason able com pensatio n to an exec

utor shoul d be fixed with reference to the entire estate and se rvices. Loftis v. Lof

tis , 94 Tenn. 232, 240-241, 28 S.W. 1091, 1093 (1895). Among the circ umstance s r elevant to the reasonableness of fees a nd expenses to be charged aga inst an estate are the extent of the executor’s responsibilities, the nature of the services re

ndered, th e pr omptness a nd adequ acy

of the se rvices, and the va

lue of be nefits conferred. In Re Estate of Wallace , 829 S.W.2d a t 701. How ever, a

ll relevant circumstances should be considered. Id.

We interpre

t the tria l court’srulingsherein a s the res ult of an examination of all fees and compensation made to Ap pellants a s well as t

hose incl uded in the

request for additio nal fees. Alth ough Appellants contend otherwise, 24 we are in agreement wit

h t he trial c ourt that i

t is appropr iateto look to the total compe ns ation paid to Appellants, in all the roles they a ssumed pursuant to the will. Such additional rol es and the compensa

tion rec eived the

rein are circumstances relevant to the re asonable

ness o f c ompensat

ion for se rvices r endere d in one of

the role s. This is especia lly true where, as here, the dec ision of how to charg e th e services (i.e., as a duty of which role) is left to the individual seeking compensation.
As a general rule, “a per son who acts both as executor and as trustee is entitled to suc h compensation as is reasonable in view o f all the duties that he performs.” S COTT & F RATCHER , supra , § 242.9 at 305 (4th ed. 1987). Similarly, “[w]hen an attorney serves as person a l representative[to an estate], he mayeither employ other counsel or furnish his own professional service s. Where h e furnishes his own services and saves the estate counse l fees by dilig ent and efficient legal s ervice s to himself , he should

be allowed g

reater compensa

tion than th at ordina

rily25 Ap pellan ts assert tha t they care fully segreg ated th e time the y spen t in each role and kept deta il ed recor ds of that time. -23- granted to an executor employing othe r counsel, but he can

be paid only in his capacity as executor, notin both capacities.” Robinson & Mobley , supra, § 863, at 541 (citi ng Holding v. Alle n , 150 Tenn. 669 , 266 S.W. 772 (1924) ( disappro ving in pa rt Fulton v. Davidson , 50 Tenn. 614 (1871)).

In In Re Esta te of Perl

berg , 694 S.W.2d at 308, this court determinedthat the co-executors
were not entitled, beca

use of a specific provision in the will, to compensationfor their services as
co-executors. However, theco-executors were entitled to expenses incurred in administration of the estate, including accounting and leg al services performed by others on behalf of the estate. The coexecutors were an accountant and a lawy er, and members of their firms had performed services for the estate. The prob lem, acc ording t o this cour

t, was tha t it was not

possible f

rom the re

cord to differe ntiate betwee n those se rvices r endere d as execu

tor, or wh ich should

have been rendered as executor, and those which were strictly accounting or legal

services. “At

leas t to the exte

nt tha t [a law firm associate], and others, performed, and ch ar ged for, executorial services that wer e the obligation of [the co-executor], the attorney s’ fees paid by the estate have been unreasonable.” Id

. at 309. We remanded for hearing and de termination as to what

services were or should have been rendered by

the co-executors as part of th eir dutie s as co-e

xecutors. For those , no feeswere to be allowed. For ‘strictly’ legal or accounting servic es performed by the co-executors’ firms, rea sonable fees were allowabl e as an expense of administration. Id. We interpret this holding as indicating that an inquiry is require d into the type of service s rendered and the classification of eac h. 25 Appellan ts assert that during the thirty month period from

the death of the testator until the resignations of Appellants, Mr. Pursell spent 998.6 hours perfor ming his dutie s as a

dire ctor of FW C andthat Mr. Whisenant spent 1,001.2 perfor ming thos e duties. The rec ord indic ates tha t Mr. Purse

ll
was paid $135,232 for his services as director and that Mr. Whisenant was paid $123,684 as director.
With regard to professional service s to FWC, Mr. Whisenant’s firm was paid $82,610 after the testator’s death. Appellants assert these fees were not for Mr. Whisenant’s time, but for his staff. Si mi la rl y, they assert that

any work done

personally by

Mr. Whisenant was not charged to the estate, butthat the $55,113 charged to the estate was for accounting work pe rformed by othe

r members of his firm.
The record

shows tha

t Mr . P ursell collected $90,000 at $3,000 per month in retainer fees from FWC inthe thirty

months following the testator’s death. In a ddition to the retainer, members of Mr. Pursell’s firm were paid $9,792 for work for F WC. Mr. Purse ll ass erts that his law firm performed

some legal work for the estate, billing the time of his partners and associates at $125 per hour. They wer

e paid $26,683 as attorneys for the esta te prior t o the firm ’s resig

nation. Mr . Pursell assertshe did not c

harge the esta te for hisown leg al work f or the es tate, inc luding su ch work in his timekeeping as an executor.26 The testator o wned two so le pro prieto rships, M LW Co mpa ny and M LW , Ltd., wh ich ow ned la nd and

bui ldi ngs le ase d to FWC and own ed mac hi ner y an d equipment al so l eas ed t o FWC.

27 We note th at a mountwoul d be div ided by thr ee, a ll owing each of Appell ants $29,500.
-24- Mr. Pursell c laimed he

spent 475. 9 hours on

his work as c o-execut

or. Of tha

t, he testified that 239.7 hours were spent onextraordinary ser vices, including legal work and work on the ESOP plan. Mr. Whisenant claimed 293.6 hours spent on extraordinary services, out of a total of 496.3 hours on c o-execut

or duties

. The trial cou

rt refus ed the request

for pay ment for e xtraordina

ry service s. Appella

nts offered affida vit testimony

which de scribed

those ser vices co nsidere d by

NationsB ank to be “e xt ra or di na ry”
as including “continuation of sale of a closely-held business, involvement in lit igation, tax controve rsies, ancillary a

dministration, or other responsibilities involving non-probate assets.” Appellants identified the services they categorized as extraordinary as filing tax returns, obtaining asset valuatio ns, revis ing tax pr ojection s, obtain

ing loa ns to pay

estate ta xes, revie wing the estate tax return, meeting about and handling real estate sales, g enerating cash flo w analy ses, dea ling with the beneficiaries and their attorney s, and conferring with each other o n theseissues. The beneficiaries introd uced af fidavits from bank trust officers that such services wer e ordinary activities expectedof an executor, not “extraor dinary service s.” Appellants argue, in part, that administration of the estate was complicated by t he actio ns and an

imosity of the beneficiaries; therefore, the y assert “extraordinary se

rvices” were required.
With regard to Appellants’ specific re quests based on the “ordinary services” portions of

the NationsBank

fee sch edule, th e benef iciarie s raised

specific objectio ns. First, A ppellant s’ reque st includ ed $120,902 bas ed on application of the fee schedule to the value of the gross estate; the beneficiar ies argue that the amount is incorrect because it is based upon an incorrect statement of the estate’ s gross assets for federal taxpurposes. When applied to the proper amount, computed by reducing the value of

the two sole proprietorships 26 owned by testator by a ssociate d debt, Ap

pellants assert that application of the percentag es on the fee schedule would result in fees of $88,502. 27

Si mi la rl y, the beneficiaries challenge the reasonableness of t

he $ 161,889 requested by Appellan ts on the basis of 6% of the estate’s income during the 30 month per iod of t heir administration. The beneficiaries argue that the income stream

in this estate “is merely a n internal transfer from one Estate pocket (the Company ’s) to another Estate pocket (the proprie torships) - both owned by the

same ent ity -the Estat

e.” Esse ntially , the esta

te owned real property

and equipment which it leased to FWC, and FWC paid rent to the Estate, with all associated expenses and upkeep, including real es tate taxes , being the resp onsibility

of FWC. Sinc e Appella

nts were also directors of FWC, for which they

receiv ed hourly

compensa

tion, the b enefic iaries charact erize thisrequest

for fees based on income from FWC’s rental pay ments as “double dipping.”
Ad di ti on al ly, Appellan

ts requ ested $32 ,820 for f ees based on the sa

le of some

real es tate ownedby the estate. The bene ficia ries esp ecially

object to

the portion of this c laim that is attributa ble to a sale

which the court

disappro ved. The

beneficiaries a

lso point ou

t that Appe

llants28 The trial court also st ated, “Number one, that settlement works becaus e a l ot of times most of t he work is done in the fi rst 90 days and the last 90 days, and you’re kind of coasti ng in the middle, whet her that’ s one year or two years
or three years. That, combine d with the f act that M r. Pur sell and M r. W hisena nt did r esign . . . in fairne ss to M r. Pur sell,
so tha t I won ’t sound like a tota l hypo crite, I did insist that if he d id no t volunta rily resign tha t I would take ce rtain actions, so I do n’t want to sound like a hyp ocrite , but I res pec t the fact tha t he vo luntarily did resig n. And I think he made the right decisi on for a lot of reasons. And I never asked Mr. W hisenant t o resign, but Mr. W hisenant, for very vali d reasons, as st ated on the witnesses stand, I respect his i ndivi dual choi ce in t hat re gard.” -25- have claimed time spent on real estate sales as “extraordinary services.” Further, they

assert, t he value of the real estate was included in the gross estate upon which the percentage fee request was based.
After hearing evi dence and arguments over a number of day s, the trial court decided that Appellan ts were entitled to reasonable fe es, refused to award additional fees on the basis of the NationsBank

fee sch edule, a nd deter mined tha t the $50,0 00 previo

usly awarded each o f Appella

nts was reasona

ble in lig ht of all th e circu mstance s. With

regar d to the reasonableness of the request for compensation for extraordinary services, the trial court found:
Combine the extrao

rdinary service s with the f

act that y ou’ve g ot –

and I’m not say

ing this is im pro per – bu t you ’ve got wha t I w ould s ay double-dipping : you have executor s’ fees, di

rector s’ fees , yo

u have oth

er fee s, it’s just

so hard to accept the fact that then there can be a third or fourth or fifth c at egory of income called “extraor dinary service s,” so I

have a se rious pro blem with th at.
* * *

. . . andbecause I find

it difficult to justify an executors’ fee and a directors’ fee and
someother fee for extraordinary services, I’m deny

ing both Mr. Pursell’s and Mr. Whisenant ’s reque st for thos e fees t hat they deemed e

xtraordina

ry service s. With reg ard to Ap

pellants’ request

for fees in accordance with the percentage calcula tions in the NationsBank schedule, the trial court found that perc entage fee schedules a re not appro

priate where the executor resigns before completion of administration of the estate, stating, “if you don’t get to the finish line , then the percen tage a greem ents just don’t work, ” becau se it is impracti cal to attempt to apply perce

ntages proportionally

when there are

sequenti al execut

ors. 28 Co ns eq ue nt ly, the court refused to award fee s based on the NationsBank schedule. Having declined t o award fees based on either th e percentage calcul ations of t he NationsBa n k fee schedule or for “extraordinary services” mentioned

in the fee schedule, the court determined that Appellan ts were entitled to reasonable fees, stating , “I truly believe that Mr. Purs ell a nd Mr. Whisenantbenefitted the estate, benefitted the beneficia ries, be nefitted the corp oration with their advice and counsel and service, and that they’re entitled to some reasonable compensation for that.” The trial cou

rt deter mined tha t $150,000

was rea sonable c ompensat ion to the c o-execut

ors for th eir services in that role, based on all the relevant circ umstances.29 Mr. Purcel l’ s port ion of the fee requ est for o ther than “extrao rdina ry servic es” is $105,204 ($315,611 divided by 3 is $105,203.67 ).

30 Ad ditiona lly, as the court noted, t he percentage fee applied to the value of the gross estate does not appear to app ly equitab ly to par tial adm inistration of an e state or par ti al h andli ng of a t rus t. That

fe e appe ars to b e a on e- ti me charge on p rincipa l for “ad ministratio n of an estate” and is b ased upo n “the m arket v alue o f all prob ate asse ts, as finally determin ed for Federal

Estate Ta x Pu rpo ses.” T hus, it is que stionab le whethe r a resign ing exe cutor or truste e cou ld claim enti tlement

to th e enti re amount ev en if the f ee schedul e were appli cable. -26- We review the trial court’s findings under Tenn. R. App. P. 13(d) and “will make our own independent

determin ation of th

e reaso nablene ss of the f ees and e xpenses, g

iving ap propria te deference to the probate court’s discretion.” In Re Estate of Wallace , 829 S.W.2d at 700. We agree withthe trial court that application of the NationsBank fee sc hedule, as Appellants interpreted that application, would resul t in fe es tha t were n ot reas onabl e in li gh t of all the circumst ances of this case. We do not imply that pay ment of executor fees according to a f ee schedule

is unreasonable. We simply find that the facts here in do not justify pay

ment according to Appellants’ interpretation of the application of the schedule. First, we note that the 236.2 hours performed by Mr. Purcell on “ordinary services” for the esta te would be compensated at $445.40 per hour if the fee r equest based on the NationsBank fee schedule were approved. 29 Similarly, Mr. Whisenant ’s 238.7 hours of “ ordinar y se rvices”would be compensated at $440.74 per hour. We find these rates to be unr easonable. 30

If all of the hours claimed by the co-executors were con side red to have been spent on “ordinary services,” and none on “extraordinary services ,” their total req uest would

result in compensation of $221.06 per hour for Mr. Pursell and $211.97 per hour for Mr. Whisenant. On the other hand, if their total services as co-executors were compensat ed a t $125 per hour, Mr. Pursell would receive a total of $59,487.50 for his claimed 475.9 hours, and Mr. Whisenantwould receive a total of $62,037.50 for his claimed 496.3 hours. They were awarded $50,000 eac h.
The trial cou

rt deter mined tha

t Appella nts had pr

ovided g ood and va

luable se rvice tothe estate. Appellants proved the hours spent on co-executor or co-trustee duties. Th

e benef iciarie s did notchallenge the n

umber of hours. Their

maincomplaint was the classification of some hours as extraordinary

services on top of the percentage fee. The trial court made no specifi c findi ngs regarding the services or time spent which it did not approve. Based on the record bef ore us, we conclude Appellants were entitled to be pa id for the hours they

documented at a reasonable rate. Therefore, we modify the trial court’s a ward of co-executor and co-trustee f ees and award a total of $59,487. 50 to Mr. Pursell and $62,037.50 to Mr. Whisenant. Both these amounts include the $50,000 previously awa

rded to each Appellant. Therefore , Mr. Pursell is entitled to an additional $9,487.50 and Mr. Whisenant to an additional $12,037.5031 Ho well v. DeLoach , No. 01A01- 9704-PB-00154, 1997 WL 629958, at * 2 (Tenn. Ct. App. Oct14, 1997) (no

Tenn. R. App . P. 11 application fi led) (defini ng jurisdiction of Davidson County Proba te Court).
-27- B. Fees for L

egal Services to the Corporation Appellants argue that the probate cour t lacked jurisdiction to order Mr. Pursell to disgo rge $70,625 of the attorney

fees paid to him by F

WC, w hen t hat corp oration w as not a pa rty to this action and did no t r e quest such relief . They also arg ue that because th

e benef iciarie s agreed to indemnify

Mr. Pursell upon his resignation, th ey should hold

him harmle ss in this case. They further assert that eve n if the pr

obate co urt had ju

risdictio n over th

i s issue, no evidence in the record supported its decision that the fees were unreasonable

. The law clearly

authorizes the probate court’s jurisdiction over this estate. 31 That jurisdiction extended to the testator’s property located within this state. Svoboda v. Svoboda , 61 Tenn. App. 444, 457, 454 S.W.2d 72 2, 728 (19 69). I n this cas e, that i n cludes the testa tor’ s stoc k in F WC. We disagree with Appellants’ argument that FWC, rather

than the b enefic iaries, w as requi red to co ntest the attorney’s f

ees Mr. Purs ell charg ed the co rporation. The te stator’sstock wa s held by the trust for the beneficiaries. FWC was the principal asset of the e state andtrust, and its standing and r ights
are inextrica

bly intertwin ed with tho se of the estate, the trust, and the beneficiaries. Further, it was only by virtue of

their position as co-trustees that Appellants served as directors of FWC. They were charged, as trustees, with operating the company during the term of the trust. Their fiduciary duties
as executors and as trusteesauthorize the cour t to examine

their de alings with trust

assets, including their de cisions on

hiring a nd compen sating t

hemselve s for pro fessiona l service s.
As explained earlier in this opinion (see II B above), the probate court had authority to examine any fee s rec eived by Appellants because (1) their performa nce as directors was the equivalent

of their performanc e as trustees , and (2) i ndepend ent cour t oversig ht of their arrang ements as client (board of directors of FWC) and professional ( attorney and a ccountant) was justified by their decision, exercising their trustee duties, to continue an employ ment relationship.
The probate cou rt clearly had co ntinuing supervis ory

jurisdict ion over t his testam entary trust. Dattel v. Brekher , 749 S.W.2d 727, 730 (Tenn . 1988) (administration of trust created to satisfy alimony obli gation was to be

closely supervis ed by

divorce court). This super

vision extended to examination of costs and expenses of administration of the trust. Id. (approving Court of Appeals disposition of expense and fee issues in Dattel v. Brekher , 1986 WL 8633 (Tenn. Ct. App. Aug. 8, 1986)). While a trustee is entitled to reasonable compensation, based upon a number of fac tors, Tenn. Code Ann. § 35-1-112, the court is authorized to approve or disapprove compensation, based upon its de

terminat ion of re asonable

ness unde r the cir cumstanc es.
A court exercising probate jurisdiction has authority to appoint and remove trustees, Tenn. Code Ann. § 35-1-1 01 an d to examine a resigning trustee’s acc ounts, Tenn. Code Ann. § 35-1- 105(2). The court

is requ ired to have the accounts of a trustee see king to resign “examined and passedupon, according to the nature of the case.” Tenn. Code Ann. § 35-1-107(a). I f the court finds-28-

a deficiency

therein, it may orde

r satisfaction thereof by

the trustee. Tenn. Code Ann. § 35-1-107(b). The court has jurisdiction to examine an accounting and order an appropriate remedy to correct any error therein. Grace Thr

u Faith v. C

aldwell , 944 S.W.2d 607, 613 (Tenn. Ct. App. 1997). Where improper distributi ons have

been mad

e, the pr obate co urt may order

refund of the distributions before approval of a final acc ounting. Estate of Cuneo v. U

nion Plante rs Nat’l Bank of Memp his , 561 S.W.2d 759, 7 65 (Tenn . Ct. App. 1 977). “T o hold othe rwise would totally

impede the author

ity of the probate court to preside over the administration of estates.” Id

. Although Cuneo dealt wit h
an estate, we conc lude the s ame rea soning a pplies to the co urt’s continuing supervision of testamen tary trusts. Finally , having

appointe d the co- trustees , the court had jurisdiction over the trustees in the performance

of their duties. First Ame rican Bank v. DeW itt , 511 S.W.2d 698, 706 (Tenn. Ct. App. 1972). As truste es, Appellants had control o f the trus t assets, including all the stock in FWC. As trustees , th ey comp rised the majority of the boa rd of directors of FWC, overseeing its opera tion. While we agree

that it is g enerally tr

ue that c orporat

e entitie s will be r

ecogn ized as se parate entities,
see e.g., Bankers Life Insurance Co. of the South v. Ban k of Alamo , 578 S.W.2d 625, 631 (Tenn. 1979), we do not agree that such rule prohibits the proba te court from examining fees paid to a trustee, approved in the exercise of trustee duties, from funds of the major a sset of the trust. To be entitled to a fee out of the funds of a trus t, an attorney must contribute some be nefit to the preservationof the trust estate. Pierce v. Tharp , 224 Tenn. 328, 338, 455 S.W.2d 145, 149 (1970). The court supervising the trust has authority to make that determination. Id. We see no basis for removing that authority from the cour t because the trust assets consist of stock in a corporation when control of the oper

ation of th

e corpor ation hasbeen g iven to the trustees . We see no

benefit to requ iri ng a new and separate lawsuit to recove r fees. Because there

was ongoing litigation concerning the admin

istration of the es tate and

the testa mentary trust , specific ally r egard

ing fee s paid to fiduciari es, the probate court correctly exercised its jurisdiction to review all fees paid to the fiduciaries.
As part of their argument that the court was without authority to order disg orgement of the retainer fees, Appellants assert that the issue was not before the c ourt and the beneficiaries had not requested that relief. Having thoroug hly reviewed the res ponse to th e petition for additional fees, we cannot agree

with Appellants’ position. That response clearly calls into question “the totality of all fees charged.” The resp onse incl uded an a ttachmen t detailing amoun

ts rece ived by Appellan ts in their various capacities, including those re ceived b y Mr . Pursell a nd his firm

for leg al servic es to FWC. The response

specific ally

asserts i t is not rea sonable t

o separa te work done for t

he estat e from work done for the company

because “(1) it is the major asset of the Estate, (2) the Co-Executors by the terms of this Will serve as Co-Directors, and (3) there was no independe nt Board of Directors to provide oversight of the reasonableness or appropriateness of the fees charged by

Messrs. Pu

rsell and Whisenant and their respective firms to the Company .”
The beneficiaries having raised the issue of the appropriatene ss of the re tainer f ee, Appe llants
were clearly on notice

of the issue . Appella

nts assert, however, that no request for disgor gement for the retainer fees already

paid was made, and, therefore, the trial c ourt could not grant that relief, or,
as Appellan

ts chara cterize it, enter

a judgme nt against Mr. Pursell for

those fees. We do not agree,-29-

beca use the trial court was asked to review a reque st for fees and, in the course of that revi ew, t o consider all pay ments to Ap

pellants “arising out of theadministration of the Estate and affairs of Mr. Wakefield.” As part of its responsibilities regarding final settlement

with resigning fiduciaries, the court was within

its authority to examine all dealings between those fiduciaries and the estate, and to approve or disapprove pay ments made.

Executors have the authority to r etain couns el to ass ist them in administering an estate; however, they are

personally liable for

the attorney f

ees until a court appr

oves them . Among c laims charg eable

to an estate, costs of administration of the estate and “reasona ble compensat ion to the personal representativeand his counsel” have first priority . Tenn. Code Ann. § 30-2-317(a). Such costs may be allowe d by the court in the executor ’s settle ment if reasonable and incurred in good faith for the benefit of the estate. In Re Estate of Wallace , 829 S.W.2d at 700-01. If a court approves the fee, the

executor may charg e it back

agains t the esta

te as one of the costs of administration under Tenn. Code Ann. § 30-2-606. State ex rel. Dahlberg v. American Sur. Co. , 173 Tenn. 505, 508-09, 121 S.W.2d 54 6, 547 (19 38); Perlberg v. Jahn , 773 S.W.2d 925, 926-27 (Tenn. Ct. App. 1989).

In order for attorney

fees to be allowed as an administrative expense, they must be shown to be required, see Vaccaro

v. Cicalla , 89 Tenn. 63, 78-79, 14 S.W. 43, 46-47 (1890), and the services providedmust inure to the benefit of the entire estate. McAdoo v. Dickson , 175 Tenn. 598, 602, 136 S.W.2d 518, 519. Thus, with respect to the issue of the p ay ment of attorney’ s fees, a primary question to be determined is whether the services directly benefi tted th e estate. Those fees not inur ing to the estate’s benefit will not be allowed. In re Estate of Wallace, 829 S.W .2d at 703 ; McFarlin v. McFarlin, 785 S.W.2d 367, 372-73 (Tenn. Ct. App. 1989).

In this regard, it has been

stated that “[t]he personal representative cannot bind the estate for payment of a retainer fee but

only for servic es rendered.” R OBINSON & M OBLEY , supra , § 863, at 540 (5th ed. 19 94) (ci ting Pate v. Maples , 43 S.W. 740, 7 44 (Tenn . Ch. App. 1 897)). We interpre t this principle as co nsistent with the requirement that services be shown to be nece ssary and to have benefittedto estate before the estate can be c harged with payment

for them. The same rule applies to fees fo r attorne y se rvices to a trust. Pierce v. Tharp , 224 Tenn. at 338, 455 S.W. 2d at 149. Thus, it is not illogical to require proof that services were a ctually rende

red in return for compensation.
Ad di ti on al ly, while a personal repre sentative may employ counsel for the estate when necessary and prop er and pay r eas ona bl e co mp ens ati on f or t hei r se rvi ces out of t he a ss ets , “In selecting counsel andcontracting liability f or their services, the representative must exercise sound discretion and good faith.” R OBINSON & M OBLEY , supra , § 739, at 340-41. See State v. Butler , 83 Tenn. 113, 118 ( 1885); see generally, Third Nat’l Bank v. Co hn , 194 Tenn. 637, 254 S.W.2d 741 (1953). The same rule applies to trustees hiring couns el for trust administration and requires disinterested decision making. Alexander v. Nelson , 825 S.W.2d at 108.
The trial court ap plied these principles. After clarify ing that the beneficiaries were not challengingfees paid to other members of Mr. Pursell’s firm, the court consider ed the $3000 per month paid Mr. Pursell on retainer. The court found that although the r etainer arrangement wa s not unreaso nable

while Mr. Wakefield was alive and made the choice t o continue

it, “[t]he pr

oblem is,32 There is a ref erenc e to 157 h ours in the record, but, again, the di screpancy does not affect our reas oning. Addit ional ly , we note that 154.6 hou rs x $125/hr . Equal s $19, 325.

33 The 154.6 hours of work perf ormed would have been compensated at $582 per hour if

the $90,000 in retai ner fees were all owed to sta nd.

34 A correction of the calcul ation would appear to be in order. -30- after Mr. Wakef

ield’s de ath, a lot

of thing s chang ed. Not on ly was the client not thereanymore, the attorney was rea lly t he clien t after M r. Wakef ield’s death.” The court also considered the other multiple fees received by

Mr. Pursell, and determined that the reta iner of $ 3000 was c learly unreasonable.
The court’s judgment ordered Mr. Pu rsel l to re pay to FWC $70,625 paid to him as attorney’s fees with respect

to affairs of the company. T he total amount paid to Mr. Pursell had been $90,000; thus, the court awarded him $19,375 for the hours of le gal ser vices he actually provided according to Mr. Pursell’s time r

ecords. Those records indicated he spent 154.6 32 hours in legal services for th e c om pa ny. 33 (During thethirty months preceding testator’s death, Mr. Pursell’s firm had billed 1230.4 hours of work under the retainer ag reement.) We note an additional $9,792 was paid to Mr. Pursell’s law firm f

or servi ces toFWC, suggesting the retainer w as for Mr. Pu rs el l’ s s er vi ce s o nl y.
We agree with the tr

ial cour t’s deter mination th at Mr. Pur sell was e ntitl ed to fees only f

or services actually provided. T hat det erminati o n is consistent with authorities requiring that such services be necessary

and beneficialto the estate or trust. To the extent the refund resulted in such pay ment, we a

ffirm. 34

We are likewise unpersuaded by Mr. Pursell's attempts to characterize the court' s order as imposing "liability" or " damages" for which th e benef iciarie s are obl

igated to hold him h armless. That agreement

is found in

the Agr eed Ord er docum enting A ppellant s’ resignations. I

t provide s, in pertinent part, “All parties in interest . . . do hereby release, indemnify , and agree to hold harm

less R.H. Pursell and Robert V. Whisenant from any a nd all duties, responsibilities, liabilities and/or obligations of either

of them arising out of or in connection with their duties and obligations in each capacity .” We disag

ree tha t this language prohibits the beneficia ries from seeking the repay

ment of retaine r fees.
The tr ia l c ou rt or de re d M r. Pu rs el l t o d is go rg e a nd re pa y th e m on th ly re tainer he received while he was a lso rece iving pa yme nt as a director of FWC, by virtue of his position as co-trustee of the testamentary

trust. The trial court exercised its authority to e xamine management of

the asse ts of the esta te, and it found that acceptingthe retainer fee under the circ umstances was unreasonable. The t rial court ’s order to disgorge unrea sonable fees already paid does not equate to the type of liability for which the bene

ficiari es agr

eed to hol d Mr. Purse

ll harmle ss.35 The tri al court did not s pec ifi cally rul e on these issues . Later, al l the benefi ciaries, including t he minors through thei r guardi ans ad li tem, en tered i nto an agr eement t o waive any enforcemen t or appli cati on of th e in ter rorem clause

. Upon learnin g of this ag reement, Appellant s inf ormed the benef

iciaries that

the agr eement l ikel y requi red approval by the court bec ause of i ts impact on the distrib utive sha re of the mino r ben eficiaries. A ppe llants moved f or summary judgment asking the court to declare the petit

ion for construct ion to be a will contest in contr avention of the will’s in terr orem claus e. These issues, as wel l as the proposed sale of FWC , the pending fee request , and the beneficiaries’ request that Appellants resign, were part of the s tatu s confer ence hel d June 27, 1997. Mr. Pursel l res igned at the conf

erence, and Mr. Whisenant r esign ed a few days lat er. On No vember 12, 19 97, the successor co-executors and the beneficiari es entered an a greed order with drawing t he pleadi ngs whi ch had inv oked the in ter rorem clause and retroactivel y approving the prior agreement among the beneficiaries. The trial court entered the order. -31- IV.
On appeal, Appellants vigorously object to statements by the trial court that t hey char acte rize
as indicating th at Appellant s’ invocation of the in terrorem clause was “improper.” Appellants assert they invoked the clause upon advice of counsel beca use they believed the adult beneficiaries were attempting to thwart the testator’s inten t with regar d to compensation of the co-executors. They interpreted

the beneficiaries’ filings as requesting the court to replace the f ee schedule with another method of compe

nsation. T

hey maintain t

hey did not ra ise the c lause to

prohibit r eview of their fees, which was the trial court’s interpretation and conce rn.
The merit s of t he issues surrounding the beneficiaries’ pe tition for construction and Appellan ts’ response

asserting the petition was in fact a will contest which triggered the in terrorem clause are not b efore u s. 35 Nonetheless, Appellan ts argue the legal validity of their position regarding the cl ause an d thei r duty as e xecu tors t o rais e it. T hese ar gu men ts are presented as justification for their

actions b ecause

Appellan ts assert the trial court wrongful punished them for raising the clause.

We do not ag

ree with Appellan ts’ contention. To the extent Appellants think they were punished by t he co ur t’ s d et er mi na ti on th at it co ul d a na lyz e the f ee requ ests for r

easonab leness, instead of applying

the fee schedule as requested by Appellants, we have found that the trial court hadauthority to make such inquiry . As thoroughly se tout herein, the trial court expressed thebasis for its determination on Appellants’ request for additional fees, and we ha ve agreed that the court considered

appropriat e principles. To the extent Appellants think they we re punished by the tria

l court’s refusal to award

additiona l fees, we point out the trial court ruled Appellants were entitled to reasona

ble fee s. The fact that we have modified the amount does not indicate the tria l court’s determination of what amount was reasonable was based on any improper motivation. To the extent they assert the punishment was the court’s encourag ement of their re signati ons, the r

ecord r eflects their voluntar y r esigna ti on . T he y have not a

ppealed any rulingsby t

he trial c ourt acc epting t

heir resignationor any actions by t he court encoura ging it , nor have

they sought to withdraw

it. Thus,
we can find no justification or support for Appellants’ contention that the trial court punished them for raising the in terrorem clause.
The record does include statements by the trial c ourt indicating its disagreement with thecoexecutor s’ use of the

clause in respon se to the b enefic iaries’ attempts to clarify their r ight to question36 A large portion of Appella nts’ brief is s pent on this i ssue. The record reveal s that the i ssue was also the subject of a l arge part

of Appel lant s’ summation a rgumen ts at t he f ee hea rin g, a nd th at di scour se wi th t he court en sued. We do not disa gree wi th Appell ants t hat t he tri al cour t clearly voic ed it s opi nion of an execu tor u sin g th e th reat of disi nherit ance to shield f ee requests. However, Appellants maintai ned throughout that thi s was not the p urpo se of the ir filings, and the trial co urt and coun sel “agre ed to disagr ee” o ver the law on this issue.

37 If App ellants are conc erned that the trial c ourt’s state men t implied pro fessiona lly impro per c ond uct, we n ote that the t rial court, in f

act, went out

of it s way t o dispel such notion s in anot her c ontex t. Although at t he begi nni ng of the status conference the court had expressed its concern about the possible confli ct of int erest and con comitant ap pearance of i mpr opriety rais ed by Mr. Pursel l’s almost omnipresen t in volvement in t his ca se, at

the cl ose of t

hat conf erenc e, t he court s tat ed:

And I wou ld like to state that it’s a ver y posi ti ve re fl ecti on on the st reng th of integrity of M r. Pur sell to voluntarily resign from these fiduciary capacities, and important to say, in fairn ess to M r. Pur sell, it would sound like he’s been tri ed and fried without t he opportuni ty to b e heard, and that’s not the
case here. Some issue s were r aised, and what we ’re deal ing with are pri nciples of a concept and whether or not they cre ate some appearances of a conflict of i nterest and what- have-you. And it’ s very important for this record to be clear and everyo ne in this ro om to ful ly under sta nd th at I have ma de
no fi ndin g on an y conf

li ct of interes t. I hav e made no fi nding of any prof essi onal impropriety. I have the highes t regard for Mr. Purs ell. He’s an ex cell ent at torney and, candi dly, a very dear friend. And it’s with grea t respe ct for M r. Pur sell that I think he’s mad e a wise decisio n to allo w this estate to go forw ard. And it woul d also be not ed that Mr. Pursell had either a 14 or 17 year relati onship with Mr. W akefield, and Mr. W akefield clearl y had great respect and trus t and fondness for Mr. Pursell, and that should not be lost in this situ ation. But I t hi nk Mr. Pursell is wis e to step aside when the appearance of a co nflict exists so that the ca se can go for ward , and h e is not unfairl y t he su bject of being se cond-gues sed in ev eryt hing he ’s done. -32- the fees of

the co-e xecutors. 36 There is only

one ref erence in the cou

rt’s ruling, inc orporat

ed into its order, to the issue.
And then to say I

sign an order that say s you’re a n executor, and I authorize the cler k to issue the le tt er s t es ta me nt ar y, and then for someone even to feel the threa t of – the veiledthreat of “don’t question the fees of the court-a ppointed fiduciary or

you may be disinherited” lacks good faith to such an extent that it’s, arg uably, bad fa

ith.
On the basis of

this sentence, Appellants assert that the trial court was in error when it found they had acted in bad

faith when they r

aised the issue of the in terrorem clause. We do not agree that the equivocal statement quoted above constitutes a finding that Appellants acted in bad faith. Again, Appellan ts assert the y were

punished for bringing a legitimate dispute to the court, but, again, we find no basis for Appellants’ claim that they were pe nalized fo r raising the clau se. Bec ause

we find
no consequ ence to A

ppellant s to have r

esulted f rom the tr ial cour t’s state ment, we d

ecline to address the issues raised by Appe llants regardingthe in terrorem clause. See State ex rel. Jones v. Looper , No. M1999-00662-COA-R3-CV, 2000 WL 354404, at *11 (Ten n. Ct. App. Apr . 7, 2000) (perm. app. denied Oct. 30, 2000) (a showing of both harm a nd error is required for rever sal). 37-33- V.
The beneficiaries argue tha t the trial cou

rt erre d in allowing Appellants to retain the $50,000 eachin interim

executor ’s feest hat were awarde d to them by ag reed order. Rely

ing on White v. McBride , 937 S.W.2d 796 (Tenn. 1996), the beneficiaries maintain that if an attorney asse sses a fee which is determined to be unreasonable and excessive, the attorne y is not entitled

to any fee , even on a quantum meruit

basis. According to the beneficiaries, this rule should be applied t o executor s, at least executors who are attorney s; because the co-executors’ fee re quest was unreasonable, they should be allowed to collect no fee. Si milarly, they argue, the entire $90,000 in retainer fees Mr. Pursell received should be disgorged. The trial court denied the request that the interim co-executor fees be disgorged, finding that $50,000 per co-executor was a

reasona ble fee for their ser vices up t o their resignation.
The parties dispute the specificity with whi ch a requ est for d isgorg ement of

previous ly awarded executor fees or other fees wasraised in the trial court. We need not resolve that dispute. However, the beneficiaries admit they did not ask

the trial court to apply the rule of White v. McBride to the attorney fees awarded to Mr. Pursell for services to FWC. Such failure does not, they arg

ue, preclude the trial court or this court from disallowing Mr. Pursel l to receive any fee s because he asserted a “clearly

excessive” claim for attorney ’s fees.
The trial court had authority to a wardreasonable fees, and it determined that $150,000 was
a reasona ble fe e for al l c o- ex ec ut or s. Si mi la rl y, while the court found the monthly pa yments under the retai ner arr ange ment with FWC to have been unreasonable, the court allowed pa yment for documentedtime spent

on lega l work for FWC, an aw ard of r

easonab le feesfor nec essary service s. We have affirmed the trial court ’s awar ds in both instances, modifying the a mount upward. Accord ingly , we aff

irm the tr ial cour t’s refu sal to ord

er addit ional disg orgeme

nts.
VI.
Ac co rd in gl y, the judgment of the trial court is affir med as mod

ified. Th is case isremanded for any fur ther proceedings which may be necessary . Costs of this appeal are to be paid by Ap pe ll an ts , M r. Pu rs el l a nd Mr . W hi se na nt , f or wh ic h e xe cu ti on ma y is su e i f n ec es sa ry.

______________________________ PA TR ICIA J . C OTT RE LL