Court Opinion

ID: 9712403
Source: CourtListenerOpinion
Date Created: 2023-08-26 04:53:11.075585+00
Date Added: 2024-06-11T18:23:11.928925
License: Public Domain

Concurring and Dissenting Opinion by
Mr. Justice Roberts:
I fully agree with the majority’s decision to hold this professional corporate fiduciary liable for breaching its fiduciary duties. I must, however, dissent from the limitation which the majority places on the extent of the bank’s liability. I cannot agree that principles of res judicata bar surcharge for the period of 1944 *16to 1949. Nor can I agree that the rate of surcharge must be fixed at six percent per annum.
I start with two settled propositions. An account of a fiduciary, confirmed by the court, is only conclusive as to what it contains. See Alpern v. Girard Trust Corn Exchange Bank, 403 Pa. 391, 399, 170 A. 2d 87, 91 (1961); Shindel's Appeal, 57 Pa. 43, 45 (1868). It is not conclusive of any item, such as interest, which the fiduciary “has omitted to charge himself with.” McLellan’s Appeal (No. 1), 76 Pa. 231, 232 (1874); see Estate of John Vogle, Deceased, 96 Pa. Superior Ct. 510 (1929).
This is particularly so in the case of a partial accounting. In a partial accounting, the fiduciary is normally concerned with securing court approval of proposed distributions. The balance of the fund will remain in his possession until the final accounting, at which time the parties will concern themselves with the question of its administration. If the fiduciary, at a partial accounting, wishes to protect himself on matters other than the proposed distributions, he must bring these matters to the court’s attention. He cannot be relieved of his fiduciary duties with respect to the balance by remaining silent and allowing the court to concern itself with other questions.
The bank urges that the decision in Lare Estate, 368 Pa. 570, 84 A. 2d 334 (1951), forecloses inquiry into the scope of its fiduciary duties, from 1944 to 1949, with respect to the balance. But, in fact, one need only look at the record of that very case to see that in a partial accounting the parties are not concerned with the administration of the balance of the estate. In Lare Estate this Court noted that counsel who prepared the schedule of distribution, as well as the trial court, forgot to award the balance of the estate back to the bank. We awarded the balance back “for further accounting after termination of the will *17contest.” Lare Estate, 368 Pa. at 577, 84 A. 2d at 338. Under these circumstances, it is difficult to see how we can now foreclose such an accounting for those years.
The second point on which I must dissent is the majority’s decision to limit the surcharge to six percent per annum. We are holding that the bank acted improperly in failing to invest these funds. Surely appellant is entitled to receive the amount of money he would have received if the bank carried out its fiduciary duties. I cannot say that this would amount to six percent per annum, nor do I understand how the majority has arrived at this figure. Further, no matter what the figure should be for any one year, we cannot apply some “average” rate of return to a balance which increased dramatically from year to year. For example, in 1949 the balance was approximately $50,000; in 1963, when interest rates were much higher, the balance was approximately $190,000. The bank must give appellant his due—no more, no less. In my opinion, we should remand to the chancellor for a determination of what the proper interest rate should be, not limited to six percent.
The determination of what interest the bank could have received is a factual one. This Court is not equipped to make such determinations, as a matter of first impression and on a silent record, nor are we permitted to guess at what the proper rate of interest should be. Accordingly, I would remand this case to ■the orphans’ court so that it might determine the proper amount to surcharge the bank. And, as I stated above, I would not bar surcharge for the years 1944 to 1949.
Mr. Justice Cohen joins in this opinion.