Court Opinion

ID: 6382586
Source: CourtListenerOpinion
Date Created: 2022-06-25 00:02:33.773489+00
Date Added: 2024-06-11T15:50:14.799082
License: Public Domain

Hunter, J.,
Exception has been filed by the trustee to a surcharge imposed by the auditing judge because of the failure of the trustee to dispose of premises 1610 Clark Street, Pittsburgh, which had' been acquired in 1936 in foreclosure of a mortgage held by the estate. The surcharge of $1,500 was the difference between the price at which the property could have been sold, $3,000, and the price for which it was actually sold, $1,500. In our opinion the facts found by the auditing judge do not justify the surcharge. The fact that the property was in the worst section of the City of Pittsburgh, and distant from the home office of the trustee in Philadelphia, required extraordinary care in the administration of this investment, yet we cannot find that the trustee failed to exercise such care. In 1937 a colored man offered $2,500 for the property with no down payment, but he agreed to repair it and pay principal at the rate of $30 a month, and the balance in three years. Later he raised his offer to $3,000 with a $300 down payment. The trustee asked the broker to secure from the purchaser a further increase of price in cash, but the broker answered that the prospective buyer had bought another property. Later in 1937 it was leased to the same man for $20 a month, and in 1940 was sold to him for $1,500, of which $500 was in cash. In our opinion, the trustee was not required to accept an offer which included so little cash. It was a situation which called for the exercise of sound business judgment, and a trustee cannot be surcharged for a mere error of judgment. There was no certainty that the purchaser would fulfil his promise, and after payment of broker’s commissions the cash to be received by the trustee would hardly pay the expense of regaining possession of the property and for the risk and trouble involved.
The auditing judge commented unfavorably upon the failure of the trustee to see that the former owner paid taxes for 1928, 1929, and 1930. He did not, however, *203surcharge the trustee with these taxes, nor do we believe a surcharge should be imposed. Interest continued to be paid until October of 1931. In sortie instances it may be good management to delay foreclosure and cooperate with an owner who is endeavoring to work out his problems. In any event, this was a matter for the judgment of the trustee, and we can find no abuse of its discretion: Goldman’s Estate, 19 D. & C. 65; Smoczynski’s Estate, 29 D. & C. 200.
The exception of the trustee is sustained.
Exceptions were filed also by the beneficiaries with regard to the exchange of stock of Land Title Bank & Trust Company and to the compensation awarded to the guardian and trustee ad litem. These exceptions are dismissed for the reasons given in the opinion this day filed in this estate sur trust for Porter F. Cope.
In accordance with the conclusions of this opinion the exception of the trustee is sustained, the exceptions of the beneficiaries are dismissed, and the adjudication is modified accordingly.