Court Opinion

ID: 6972075
Source: CourtListenerOpinion
Date Created: 2022-07-24 02:04:21.340906+00
Date Added: 2024-06-11T16:08:50.124758
License: Public Domain

Mr. Justice Boggs delivered the opinion of the court: To quote from the brief of counsel for appellant: “The appellant in this court only desires to argue four questions: First, Kaehler was charged with the full trading value of the machinery disposed of by him, namely, $1400, this amount being made up of three items, one note, for $500 and one for $400, secured by trust deed on the property at Steger, Illinois, which trust deed Kaehler foreclosed and acquired title to the lots. He also received four lots which were conveyed to him by warranty deed, and was charged therefor $500, which was the consideration named in the deed. Appellees were entitled to receive either the value of the machinery traded, or securities and property received therefor, or the value of the security and property. They elected to take the value of the securities and property received by Kaehler but failed to make any proof as to what the actual value was. Second, the appellees were ruled by the master to file written objections to the account of Kaehler, which they did, and the evidence before the master was confined to those items to which objection was made. A charge of $610 by Kaehler for compensation was disallowed, although no objection was filed thereto. Third, it was error to charge Kaehler with the proceeds received from his stock in the Cook County Brick Company, it being his individual undertaking. Fourth, the chancellor erred in decreeing that the amount due appellees should be allowed as a sixth-class claim against the estate of Peter F. Kaehler, deceased.” First—It was not error that the full trading value of the machinery, namely, $1400, was charged against Kaehler, and that the appellees were credited with the value of the securities and property received by Kaehler. It was shown that Kaehler received two notes, one for $500 and one for $400, both secured by a trust deed on real estate at Steger, Illinois, and he also received four lots which were conveyed by warranty deed, and the consideration recited in the deed was $500. It was further shown that the trust deed securing the two notes was afterwards foreclosed and the title acquired by Kaehler. Moreover, when testifying as a witness Kaehler stated that the whole value of the property he received was $1400, and in a supplemental statement, bringing the account down to August 25, 1899, Kaehler charged himself with the amount realized from the sale of the machinery and fixed the sum at $1400. Second—It is insisted that the appellees were required by a rule of the master in chancery to'file written objections to such parts of the account as they desired to object to, which they did, and that the evidence before the master was confined to the items objected to; that a charge of $610 was made by Kaehler for services rendered, and that the master disallowed said sum of $610 without any written objection being filed thereto. Appellees filed an objection to Kaehler’s account as to the allowance of any and all compensation, and urged that because of certain alleged improper acts on the part of Kaehler as trustee he had forfeited his right to any compensation whatever. From an examination of the proof preserved in the record on the point we think the objection sufficiently raised the question and that it was regarded by all the parties and by the master as being so raised, and that evidence was heard upon the question of this particular item in the account. We may very properly here consider the cross-error assigned by appellees: “Finst, that in no event can more than the stipulated $10 per week be allowed for the trustee’s compensation; and second, that this trustee forfeited all claim to compensation in any amount because of his persistent refusal to account for the brick company money and his evident attempt to consume the whole fund by unjustifiable charges.” Under the original agreement Kaehler was to hold the property for all the creditors of Mayer & Towle and should sell the same and make disposition of the funds derived therefrom in accordance with the understanding of the parties, for which said Kaehler was to receive compensation at the rate of $10 per week. Some weeks after this agreement was entered into, and after Kaehler had taken possession of the property, a further understanding was had among the parties to the original agreement, whereby, as no advantageous sale could then be made, Kaehler was to operate the brick plant for the use of all the parties, and that such capital as was necessary to operate the plant should be furnished by Kaehler. Under this later agreement to operate the brick plant it became necessary for Kaehler to devote practically all of his time thereto and to lay out large sums of "money in repairing the machinery and equipping the plant for operation. The original agreement creating the trust contemplated that the trustee should be compensated for his services in caring for the property, selling it and distributing the proceeds, such being the extent of the trustee’s duties and powers. Subsequently, by an express agreement his duties and powers were enlarged and additional services, different in their nature, were required of the trustee, and also the application of his own money to the execution of the trust duties, as enlarged by the later agreement, was required, and no agreement was made for additional compensation. When the agreement creating an express trust provides that the trustee shall be compensated and fixes a specific sum to be paid as such compensation, if, by an express agreement, new duties are required to be performed by the trustee different in their nature from such as were required of him under the original agreement, a court of equity may allow compensation in a reasonable amount for the performance by the trustee of the additional duties required of him by the supplemental trust agreement. (28 Am. & Eng. Ency. of Law,—2d ed.—1039.) In rendering his account Kaehler specified, in addition to the $10 per week under the original agreement, the sum of $30 per week as a reasonable compensation for the additional services required of him under the agreement to. operate the plant and for advancing the necessary funds to so operate it. It appears from the testimony of Kaehler that he had $5000 invested in the brick plant in addition to the debt owing him from Mayer & Towle. The services of Kaehler required .under that agreement to operate the plant were outside of and additional to the services required under the original agreement and different in their nature. The expending of his private funds was also additional thereto and different in character. While Kaehler was holding the brick plant, under the original agreement, for the benefit of all the creditors of .Mayer & Towle who joined in that agreement, it would be unjust and inequitable to require that he should perform the additional services and advance his private funds for the benefit of the parties to the agreeménts, both original and supplemental, for such a length of time as the evidence shows he did, and should receive nothing more than the compensation provided for in the original agreement, in the performance whereof the services were light and no investment of funds necessary. The total allowance made by the Appellate Court was $10 per week under the original agreement and $30 per week for his services and the use of his private funds in operating the plant under the supplemental agreement. There was uncontradicted evidence showing the management of the plant was worth $50 per week. We think, under all of the circumstances, the judgment of the Appellate Court was amply justified by the proof in the record. Third—This assignment raises the question whether it was error to require an accounting of the funds received by Kaehler from the Cook County Brick Company. In holding such accounting proper we think the decree was correct. The evidence shows that the amount paid by Kaehler for the stock in the brick company, namely, $225 for nine shares thereof, was not the real consideration therefor. The fact that Kaehler was in possession of the brick plant as trustee for the creditors of Mayer & Towle, and could control it and lease it to the new company, was the real and true reason why the organizers of the Cook County Brick Company permitted Kaehler to take stock in the brick company. The evidence shows that stock was sold by said brick company only to the owners or lessees of brick plants. Had Kaehler not been acting as trustee for the creditors of Mayer & Towle he would not have had possession of the brick plant, and had he not had possession of the brick plant no opportunity would have been offered him to take stock in the brick company. Whatever profits were made on the stock in the Cook County Brick Company were made for the creditors of Mayer & Towle, for whose use Kaehler had the possession and management of the brick plant. Fourth—It was not error for the court to decree the amount to be paid by the appellant administrator of Kaehler to the appellees, in due course of administration, as a claim of the sixth class. The statute provides that “when the decedent has received money in trust for any purpose, his executor or administrator shall pay out of his estate the money thus received and not accounted for,” and a claim of this character is of the sixth class. As we have seen, the indebtedness was that of a trustee for moneys received under an express trust for the use of the beneficiaries of the trust. It was therefore properly classified as a claim of the sixth class against the estate of 'the trustee. Wilson v. Kirby, 88 Ill. 566; Svanoe v. Jurgens, 144 id. 507. The judgment of the Appellate Court is affirmed. Judgment affirmed.