Court Opinion

ID: 4135588
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:03:59.944959+00
Date Added: 2024-06-11T14:34:32.851153
License: Public Domain

W’ILL    WILSON
*lToRNEiY      GENERAI.
                                     July 18, 1962

        Honorable William Hunter          Opinion No. WW-1391
        District Attorney
        69th Judicial District            Re:   Whether each of thren
        Dalhart, Texas                          executors of a decedent's
                                                estate is entitled to
                                                compensation under Article
                                                241 of the Probate Code for
                                                sums of money paid out by
                                                them under the two stated
       Dear Mr. Hunter:                         fact situations.
              You have requested the opinion of this office as to
       whether each of three executors of a decedent's estate is en-
       titled to compensation under Article 241 of the Probate Code
       for sums they have paid out in cash for the following:
                 1.   When money is paid to one of the executors
                      who is employed by the estate as a clerk in
                      a store operated by the estate.
                 2.   Payment of attorney&' fees for administration
                      to a partnership when one of the executors is
                      a member of such partnership.
       Supplemental information was received, to the effect that the
       executor who engaged in the operation of the store actually
       acted as the manager thereof.
                 Article 241 of the Probate Code reads as follows:
                                om ensation of Executors and Adminis-
                 tratoZa)     ' '
                          . Executors   and administrators shall be en-
                 titled to receive, and may retain in their hands, a
                 commission   of five per cent (576)on all sums they
                 may actually receive in cash, and the same per cent
                 on all sums they may actually pay out in cash, in the
                 administration of the estate; provided, no commis-
                 sion shall be allowed for receiving cash belonging
                 to the testator    or intestate which was on hand or
                 on deposit to his credit in a bank at the time of
                 his death, nor for paying out cash to the heirs or
                 legatees as such; provided, further, however, that
                 in no event shall the executor or administrator be
                 entitled in the aggregate to more than five per cent
                 (5%) of the gross fair market value of the estate
Hon. William Hunter, page 2 (WW-1391)

       subject to administration. If the executor or
       administrator manages a farm, ranch, factory, or
       other business of the estate, or if the compensa-
       tion as calculated above is unreasonably low, the
       court may allow him reasonable compensation for
       his services. For this purpose, the county court
       shall have jurisdiction to receive, consider, and
       act on applications from independent executors."
       As regards the executor who dealt with the store, the plain
language of the statute must control. The statute says, "If the
executor or administrator manages a farm, ranch, factory, or other
business of the estate, or if the compensation as calculated above
is unreasonably low, the court may allow him reasonable compensa-
tion for his services." This "reasonable compensation" allowable
by the court is in addition to any commission that would be pay-
able to the executor for his activities as executor in administer-
ing the estate.
       With respect to the executor who is a member of a partner-
ship which was retained by the three executors to handle the
legal aspects of the estate administration, the problem is con-
siderably more difficult. Apparently, only one case in Texas has
dealt with the matter of an estate paying the legal fees of an
executor who has retained himself (or his law firm). Neblett v.
Butler, 162 S.W.2d 458 (Civ.App. 1942, error ref., w.o.m.). ThiS
casedealt with the propriety of attorney's fees and, in obiter
dicta, compared the two positions regarding compensation of an
executor who has also performed legal services for an estate. The
court in Neblett felt that there is no compelling reason for refus-
ing to compensate such an executor, and would have held in favor
of paying him his attorney's fees, had such a ruling been germane
to the problem before them. It must be noted that the position
taken by the Galveston Court of Civil Appeals is a minority one,
having been adopted completely by only four other states Alabama,
New Jersey, Pennsylvania and Tennessee). 65 A.L.R. 2d 811, A15.
Nevertheless, the expression made is the only court decision we
have to serve as a guide, although it can be considered as no more.
       If we assume that the Texas courts will approve of an exe-
cutor retaining himself or his law firm to perform the legal work
connected with the estate, then we are forced to the conclusion
that the executor would be entitled to have such fees included
within the amount upon which his statutory commission is computed.
Article 241 of the Probate Code cannot be construed as forbidding
even such a commission as this. It should be noted that in Opin-
ion No. 182 (1958), the Committee on Professional Ethics of the
State Bar of Texas held that it was proper for an attorney to act
Hon. William Hunter, page 3 (WJ-1391)

as independent executor of a will, handle the administration
thereof, and charge a reasonable attorney's fee therefor.
Nothing was said in that opinion regarding the propriety of also
accepting the statutory commission normally due an executor.
Therefore, we are constrained to hold that, until such time as
the statements made in Neblett are held not to be the law in Texas,
an attorney-executor may retain himself or his law firm, pay the
legal fees out of the estate (so long as tke reasonableness there-
of is upheld by the probate court), and then have such fees in-
cluded within the amount upon which his statutory commission is
computed.
                             SUMMARY
            Under Article 241 of the Probate Code, an
            executor who manages a store belonging to
            an estate is entitled to a reasonable compen-
            sation, to be set by the court, and should
            receive a commission on funds received or
            paid out in connection with the store.
            An executor who has retained himself or his
            law firm to handle the administration of the
            estate is entitled to have the legal fees paid
            to such firm included within the amount upon
            which the said executor's statutory commis'sion
            is computed.
                                 Yours very truly,
                                 WILL WILSON
                                 Attorney General of Texas

                                 By&&&
HL6,:
    ms                               Assistant Attorney General
APPROVED:
OPINION COMMITTEE
W. V. Geppert, Chairman
F. R. Booth
Scranton Jones
Bill Allen
REVIE~JEDFOR THE ATTORNEY GENERAL
By: Leonard Passmore