Court Opinion

ID: 9667458
Source: CourtListenerOpinion
Date Created: 2023-08-24 01:46:17.512824+00
Date Added: 2024-06-11T18:15:38.093868
License: Public Domain

On Motion for Rehearing
PER CURIAM.
Defendant says he accounted for the 5% commission on the corpus distributions to the beneficiaries in his 1953 report. (Made after the trial herein.) Of course, if he has done so the trial court may take that into consideration in its final decree.
Other matters raised in the motion reargue rulings made in our opinion and we adhere to these rulings for the reasons stated therein. However, we note one argument made by defendant as follows: “The annual interest charge of $120.00 on the $3,000.00 deed of trust put on the Miami property to get funds to buy the Russell property cannot be considered (as the Court erroneously did) as a charge on the Russell property income and at the same time the principal amount of $3000.00 be considered as money invested in the Russell Avenue equity. If the loan is to be treated as a purchase money mortgage for the Russell property with the interest charged against Russell property income, the corpus invested in Russell is only $9500.00. The assets of the trust invested in the Russell property, were the Accomac property, valued at $4,500.00, and cash in the sum of $5,000.00. The Court] simultaneously eharg'ed $120.00 interest against Russell income and computed the yield from the investment on the. basis of $Í2,50Ó,00 investment.”
The only bearing this matter has- is in' fixing the amount of the investment in Russell for the purpose of figuring the annual percent of yield produced by it. Actually our mistake was that, in computing this yield, we failed to consider the $14,000.00 mortgage on Russell in-*1124determining the total investment therein. (Plaintiffs’ attorney had likewise failed to consider it in figuring the yield.) Actually the total investment in Russell was $26,500.00 ($17,000.00 borrowed funds— $9,500.00 estate funds); and, to give the true figure, the yield should be figured on $26,500.00 because the trust estate was obligated for the $17,000.00 debt and had to earn and pay the interest on it. The fallacy of defendant’s argument is shown by the fact that, under his method of computation, any yield would be 100% if he had borrowed the entire $26,500.00 to buy Russell.
It should also be said that it is not true as suggested that there would be a conflict of interest between trustee and beneficiary in every case in which the trustee’s compensation was fixed as a percentage of gross income. The determination of a real conflict would depend on the percentage involved, the proportion of the net income to gross income, and the way in which the estate was managed with reference to increasing gross income disproportionally to net income.
The motion for rehearing is overruled.