Court Opinion

ID: 6125108
Source: CourtListenerOpinion
Date Created: 2022-02-04 20:22:56.759497+00
Date Added: 2024-06-11T08:27:42.706857
License: Public Domain

Brady, J.:
In the year 1868, the New York Life Insurance and Trust Company were appointed, by order of this court, trustees of a trust fund amounting to $60,000 and upwards. The trust had been created by an agreement and assignment in trust, whereby the income was to be paid over as directed, and upon the death of Rachel M. Moffat, one of the annuitants, $50,000 of the principal was to be divided equally between two persons named. Rachel M. Moffat died in September, 1879, and, on an application for that purpose, an order was made directing the distribution in accordance with the agreement and assignment in trust already mentioned.
It appeared that the trust estate was made up of United States bonds of different denominations of the par value of $16,600, and cash to the amount of $5,575.37, but that the fund had increased since the creation of the trust.
It was conceded on the application for the distribution which was directed, and when the question of commissions arose, that the New York Life Insurance and Trust Company were entitled to commissions on the- cash item mentioned; but it was insisted that they were not entitled to commissions on the rest of the fund. The learned justice presiding at Special Term sustained that view and hence this appeal.
Trustees are entitled to commissions at the same rates as executors, and these rates are established by statute (2 R. S., 93, § 58, as amended), which are five per cent upon the first $1,000, two and one-half per cent upon the next $9,000, and one per cent upon the *327balance. A trustee is granted commissions as compensation for the discharge of the duties imposed upon him by the trust, involving responsibility, care and often the exercise of judgment, which depends upon many things resulting from thought and investigation, and the commissions are computed upon the entire fund held in trust of whatever the property consists. The vice-chancellor, In the Matter of De Peyster (4 Sandf. Ch. Rep., 511), said that in respect of stocks, bonds and mortgages the law was well established that the trustee is entitled to his commissons on discharging himself, although he transfers to his beneficiaries, or to new trustees, the entire stocks and securities which came into his hand at the outset of his trust; and this doctrine was recognized and reiterated in the case of Cox v. Sehermerhorn (18 Hun, 16).
It is said by the respondent that the vice-chancellor, In the Matter of Jones (4 Sandf. Ch. R., 615), declared that the trustee was not entitled to these commissions. This is a very extraordinary error, because the vice-chancellor made no such decision. On the contrary, he expressly recognized the right of the trustee to commissions if he continued to discharge the duties of the trust, but withheld the commissions because he asked to be relieved of the trust and was so relieved on terms, one of which was that he should not. have his commissions.
The case of Schenck v. Dart (22 N. Y., 420) does not conflict with this view. It was there held that the executors would not be allowed commissions upon the transfer of corporate stock which was specifically bequeated to legatees, and which involved no other labor than to hand it over to the persons designated to receive it.
The duties of the New York Life Insurance and Trust Company were entirely different. They were to hold the securities and money and their accumulations, and to pay over and divide part of them upon a certain contingency arising, as the order made in reference to the distribution indicates, and which directs that after making certain payments to counsel, the company should pay, assign and transfer one-half of the moneys and securities remaining in their possession belonging to said principal of said trust fund, except the $10,000 mentioned in said trust agreement and therein intended to be preserved until the decease of the annuitants named in the will of John Moffat, deceased.
*328The management of the trust estate involved collecting coupons and interest, and the care and custody of the securities and the division of a part of the fund, which is very different from merely handing over securities to a legatee designated to be their recipient.
We think for these reasons that the order appealed from was erroneous, that the commissions, amounting to the sum of $696.75, should have been allowed, and that the order should be modified by allowing them, but with ten dollars costs and disbursements.
Davis, P. J., concurred.
Present — Davis, P. J., and Brady, J.
Order modified as directed in opinion, with ten dollars costs.