Court Opinion

ID: 5229081
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:52:01.068697+00
Date Added: 2024-06-11T08:27:38.119400
License: Public Domain

Smith, P. J. (concurring):
After the defendant insisted upon the return by petition of the $3,000 specified in the judgment of the Appellate Division a motion was made to this court for a reargument and modification of our decision wherein the $3,000 judgment was directed. Some of the members of the court were of opinion that the relief should be sought at Special Term; others were against the granting of the motion upon the merits. The majority of the court, therefore, were of opinion that the motion should be denied. Thereafter the motion was made at Special Term, and upon the hearing at Special Term the defendant insisted and procured a holding by the Special Term adjudging that the matter had been determined by the Appellate Division in its denial of the petitioner’s motion and that the Special Term could do nothing but affirm that action. Upon the appeal from that order to the Appellate Division the majority of the court were of opinion that the Special Term rightly followed the determination of the Appellate Division and was bound thereby and, therefore, that order was affirmed with leave to renew the motion for reargument and modification in this court. As the defendant has procured from the Special Term a holding to the effect that the Special Term was bound by the former decision of this court, it is not now in position to claim that the petitioner’s relief should have been had at Special Term rather than in this court.
This brings us to the merits of the application. In our original judgment in the case we determined that the allowance to the receivers of $19,000 for their work was excessive, and that the allowance should have been $12,000 for their services in performing the duties of the office. The receiver Higgins, at a personal expense of about $3,000, had secured the annulment of the Dolson contract, which was an illegal contract and prejudicial to the interests of the trust. If those matters had been before the Appellate Division he fairly should have been allowed for his expenses in securing that valuable right to the trust estate. This fact would seem to be alone sufficient to authorize this court to modify this decree and grant to the receiver Higgins not only the $12,000 allowance, but an allowance of $3,000 to cover the expenses of the annulment *175of the Dolson contract. Of the $19,000 received by him he had already surrendered $4,000, so that he had in fact received $15,000, the amount which equitably should be allowed for his services and for this expense item of $3,000. But, in addition to this, it appears that of the moneys received Mr. Higgins had passed $5,000 over to pay the expenses of the depositors’ committee, which was a moral obligation of the bank, and the balance of the expenses was afterwards paid by the bank itself. He had expended besides the $3,000 for services in procuring the annulment of the Dolson contract $3,000 additional for other services of counsel in other matters relating to the estate. He had been advised that the legal fees of the receiver would amount to $15,000 instead of $19,000, and upon the assumption that the fees would be reduced simply to the legal maximum. after giving the $5,000 to the depositors’ committee and retaining $6,000 to reimburse himself for expenses paid, he set apart $4,000 as a reserve fund to meet subsequent expenses, and from the balance left he promised to give part to the bank and part to some charitable purpose. There was at no time any binding promise upon his part to act without compensation. His position at first was that he would act for such compensation as should be approved by the depositors’ committee and by the court. After the excessive allowances made by the Special Term he did state to the depositors’ committee that he would act without compensation for his personal services. Exit that promise was not binding upon him. There was no consideration therefoi’, and if he should choose to change his mind and demand a compensation which the law allows and to which he is equitably entitled the court would grant it. But this promise has been in fact fulfilled. He has paid $5,000 to the depositoi’s’ committee; he has paid $6,000 in expenses both in the Dolson contract and other matters. The $4,000 which he placed in the reserve fund has been exhausted by subsequent expenses in the matter of the trust. It is true that this does not appear under Mr. Higgins’ oath, but it appears in the communication to Mr. Brayton Ives of December 1, 1911. It is nowhere contradicted. This makes $15,000 expended by him for the benefit of this trust for which he has been allowed only $12,000 by this judgment. So that *176if this judgment be modified, as requested by him, he would simply be allowed his expenses without retaining one cent for his services.
This result is reached irrespective of this release executed by the bank to him which is claimed to constitute a release of this indebtedness. I concur with Mr. Justice Woodward that the release is broad enough to cover this claim; but it seems to me of small moment what may be the technical construction of this release. He swears that the matter was all agreed to between him and the officers of the bank that he should receive $15,000 allowance and should expend it in the way indicated, and that that was what was meant to be provided for in the release. I have looked in vain through the papers for any denial of this understanding between him and the officers of the bank, and with this distinct agreement made every equity is in favor of the modification of the decree to provide for these expenses. Criticism is made that this was kept secret from his coreceiver and from the court, although this release existed and this agreement was made before the argument before this court. There certainly could be no obligation to disclose the matter to this coreceiver to whom he was acting in open hostility, and especially as he was seeking no advantage over the receiver, but was consenting to take practically nothing for his services. There was not the slightest reason at that time for his disclosing the matter to the court. The only object which he could have had in disclosing the matter was to have had the court allow bim $3,000 for expenses over and above the amount for services, and for this he had the clear right to rely upon the explicit agreement which he had made with the officers of the bank, and upon their failure to carry out that agreement he is justified in coming to the court and asking relief.
I concur, therefore, in recommending the modification of the decree as asked for.