Opinion ID: 1966617
Heading Depth: 1
Heading Rank: 13

Heading: Whether the accounting of the executors should have been allowed.

Text: The exceptants in the accounting proceedings in the former Prerogative Court appeal from so much of the decree of that court as confirms the master's report in connection with the dismissal of the fourth exception to the account wherein the exceptants had sought to have approval of the account stayed, and allowances to the executors withheld, pending the outcome of the suit brought against the executors for their removal (hereinbefore discussed). The exceptants' argument is that, confronted upon the accounting and upon application for allowances with proof that issues relating to a breach of trust by the executors had been tendered to the former Court of Chancery, it was an abuse of discretion on the part of the former Prerogative Court to deny the stay of confirmation of their account and grant of allowances pending the outcome of the removal suit. The executors contend that because they were required by law to file their account and the exceptants offered no proof of dereliction on the part of the executors, the court properly allowed their account with commissions and counsel fee. In re Megargee, 117 N.J. Eq. 347 ( Prerog. 1934) is cited by both the executors and the court below in support of this argument. In the Megargee case, however, the decision of the former Prerogative Court (reversing the Orphans' Court's denial of commissions) came after the removal of the executors by the Orphans' Court had been set aside and the executors reinstated on appeal (see p. 351). In the present matter application of the executors' theory would have required the trial by the Prerogative Court of the issues then pending in the Court of Chancery. The exceptants did not seek absolute denial of confirmation of the account and the allowances but merely a stay pending the outcome of that equity suit. It is true that removal of executors was not sought in the Chancery suit at the time this accounting was before the Prerogative Court, for alleged jurisdictional reasons, but the amended bill of complaint (which was submitted in proof in the accounting proceedings) charged the derelictions of the executors and sought injunctive relief to prevent the executors-defendants from acting as directors and proof of the accusations would have required either a denial or a considerable reduction of the allowance of commissions. This bill was subsequently amended (see recital of proceedings ante ) after the decree in the accounting proceedings to seek removal of the executors on the same allegations of facts. In effect, the exception to the account seeking the stay was in the nature of a motion for continuance to permit the taking of proofs and the rendition of judgment on the charges of breach of duty by the executors. A motion for continuance is addressed to the sound discretion of the trial judge to be exercised with a view to the manifest rights of the parties and the prevention of injustice and oppression under all the circumstances of the case, and the exercise of this discretion will be interfered with by an appellate tribunal only when the action of the trial court constituted a clear abuse of that discretion. Hawthorne v. Jowett, 121 N.J.L. 38, 39 ( E. & A. 1938); Heinz v. Atlantic Stages, Inc., 113 N.J.L. 321, 325 ( E. & A. 1934); Haines v. Roebuck, 47 N.J.L. 227, 228-229 ( Sup. Ct. 1885). The exercise of discretion implies conscientious judgment, not arbitrary action. Carlo v. Okonite Callender Cable Co., 3 N.J. 253, 262-263 (1949). Under the circumstances of this case, it is clear that the refusal of the former Prerogative Court to stay the allowances and confirmation of the account upon exception to the account was an abuse of discretion which injuriously affected the substantial rights of the exceptants and tended to permit injustice to occur. R.S. 3:11-7 provides that a fiduciary removed for cause under R.S. 3:12-4, supra, shall forfeit his commissions and shall not be entitled to any commissions or compensation for his services, unless the court shall otherwise direct. R.S. 3:7-76 provides that a fiduciary removed or discharged by any court shall, within 60 days or such shorter or longer period as the court may direct, state and settle his account before the chancellor, ordinary or Orphans' Court, as the case may be, for all the assets of the estate in his charge. We shall therefore reverse the decree of the former Prerogative Court as to the portions appealed from and remand the matter of the accounting of the executors of Israel Koretzky deceased to the Chancery Division of the Superior Court with the direction that the original accounting shall be opened and continued for the purpose of complete accounting as required of the executors by statute upon their removal as such executors, including examination anew into the question of allowance of commissions and counsel fees, that substantial justice may be done under all the circumstances surrounding this matter consistent with this opinion.