Opinion ID: 1197637
Heading Depth: 1
Heading Rank: 7

Heading: The surcharge of the trustee for excessive trustee fees and accounting fees.

Text: The decree of the trial court would also surcharge Leo Gorger with the sum of $16,000 in reimbursement of excess trustee's fees. For five years (1961 until 1966) Leo Gorger made no charge against the trust for his services. Beginning in 1966, however, and for the subsequent eight years, he charged $6,000 per year for such services, or a total of $48,000. Of that amount he drew $12,000 in cash and left the remaining $36,000 in the business as operating capital, although credited to his account. The trial court found, based upon the full history of the matter, that a fee of $4,000, or a total of $32,000, was just and equitable and ordered that Leo Gorger be surcharged for all sums in excess of that amount paid to him or credited to his account. Defendant Leo Gorger assigns this as error. Plaintiffs' response is simply that The trial court determined what was deemed to be a reasonable trustee fee, taking into consideration all the facts of the case. Whether Mr. Gorger received fees prior to 1966 is irrelevant, since he waived them during this period. If the full history of the matter was limited to testimony and other evidence upon the subject of the nature of the services performed by Leo Gorger as trustee and the reasonable value of such services, we might agree. In our judgment, however, a review of the full history reveals that other and additional facts and circumstances must also be considered in any fair determination of this question. First of all, it is not entirely clear that Leo Gorger intended to waive any and all claim to compensation for his services as trustee. During those years he continued to manage the various properties and investments of the trust and devoted a substantial amount of time to the performance of these duties, as well as the performance of physical work in the operation of the Pendleton ranch. One of the children described these services as involving hours and hours beyond which any of us had comprehended. In any event, at a family conference in 1966 the subject of some compensation for such services was first discussed with his children. According to plaintiff Donald Gorger, his father then suggested that he be paid $6,000 per year for such services. Some of the other children testified that the $6,000 figure was not suggested by their father, but by one of the daughters, and that, in their opinion, such a fee was not unreasonable. Regardless of who suggested that figure, plaintiff Donald Gorger testified that he and his brothers and sisters then agreed that $6,000 per year be paid to their father for his services as trustee, although saying that they had no standard to which to relate that figure. [8] Thereafter, and up to the filing of this lawsuit, none of the children apparently ever objected to such compensation, and in that amount. As previously stated, most of such fees were not paid to Leo Gorger in cash, but were left by him in the business as working capital, although credited to his account. For six of the eight years involved (1966-1971) Leo Gorger continued to manage the trust properties in much the same manner as in previous years, including work in the operation of the Pendleton ranch. As recognized by the trial court, there was evidence that it would have cost $12,000 per year to hire a manager for that ranch. In 1971 that ranch was leased out, with the result that during the last two years he no longer engaged in the actual operation of that ranch. He continued, however, as the active manager of the trust estate. Under these facts and circumstances, and regardless of whether or not there may have been a waiver by Leo Gorger of compensation for his services as trustee for the first five years, we hold that the sum of $6,000 per year for his services for the remaining eight years was not unreasonable, when considered in the light of the full history of the matter, and that he should not be surcharged for any portion of the amounts paid or credited to him for such services. [9]