Heaphy v. Walsh

354 P.2d 1048, 138 Mont. 96, 1960 Mont. LEXIS 66

• Court: Montana Supreme Court
• Decided: August 19, 1960
• Docket: No. 10076
• Status: Published

Opinions

MR. JUSTICE ADAIR

delivered the Opinion of the Court.

On September 10, 1957, Martha Heaphy, an elderly school teacher, residing in Anaconda, Montana, filed in the district court for Deer Lodge County, Montana, a petition requesting that she be appointed the guardian of the person and estate of her cousin, Mary Dalton, which estate the petitioner stated was of the estimated value of $76,000.

To represent her in drafting the petition and in instituting and prosecuting the proceeding, the petitioner, Martha Heaphy, retained and employed Emmet T. Walsh, a duly licensed and practicing attorney at law, residing and maintaining his law offices in Anaconda.

A day was set for the hearing of Miss Heaphy's petition, — due notice was given of the hearing, — citation was promptly issued and duly served upon Mary Dalton and the hearing held following which Mary Dalton was adjudged to be an incompetent person.

On October 4, 1957, Martha Heaphy was granted letters of guardianship for the person and estate of Mary Dalton and such guardian retained and employed Emmet T. Walsh, Esq. as and for her attorney whereupon Mr. Walsh instituted appropriate proceedings incident to such guardianship.

During the course of such guardianship proceedings it was discovered that the guardian periodically received dividend cheeks from certain corporations for which the stock certificates could not be found, as such certificates had either become mislaid or lost, and it was also discovered that some of the ward’s stock certificates had been endorsed in blank, all of which occasioned and required prompt and extraordinary work and services on the part of Attorney Walsh, who immediately wrote all the corporations involved for a transcript of the stock holdings of the ward, Mary Dalton.

After a transcript of the ward’s stock holdings had been obtained from nine different corporations a comparison check was made with existing holdings and thereby the lost or mislaid stock certificates were ascertained following which Attorney Walsh notified the New York Stock Exchange of the lost stock certificates and procured stop orders to prevent the transfer of the certificates in the event they had fallen into the hands of others. Thereafter Attorney Walsh submitted affidavits of loss to the transfer agent of each of the nine corporations and indemnity bonds were supplied at a cost to the ward’s estate of approximately $5,500.

Thereafter replacement stock certificates were received by the ward’s estate, the first of which were received in July 1958 and additional stock certificates were obtained each month thereafter during the remainder, of that year the last being restored in December 1958.

The total of the restored stock amounted to 1806 shares valued at $155,479.88 and in January 1959, 100 shares of Montana Power stock, which had been endorsed in blank by the ward, were restored and placed within the control of the guardian.

In addition to the above extraordinary services, Attorney Walsh, for over eighteen months carried on and attended to all other necessary details and proceedings incident to the guardianship.

On April 17, 1959, Martha Heaphy filed her first account as guardian wherein she accounted to the district court for the period from October 4, 1957, to April 14, 1959, for inventory and cash received in the total amount of $209,420.12 and at the same time said guardian petitioned the district court to determine and award a reasonable allowance and fee for her services as guardian and to also determine and award a reasonable allowance and fee for her said attorney, Emmet T. Walsh.

After the filing of her aforesaid first account and petition and prior to the hearing thereon, Martha Heaphy decided that she would not take or accept any fee whatever for the services rendered by her as guardian and that she would merely seek reimbursement from the estate for her own outlay and expenses incurred and she also expressed some doubt as to the amount of the fee that should be allowed for the professional services that had been rendered by her attorney, Emmet T. Walsh, and, to protect the estate of her ward, the guardian employed additional counsel to represent her interests at the hearing involving the determination of the amount of attorney’s fees to be allowed Emmet T. Walsh.

The hearing on the guardian’s account and petition was held June 12, 1959, at which time it was mutually agreed that the fact that an attorney’s fee was then owing was not in question and concerning which matter the only question was as to the amount of such attorney’s fee.

In her account and petition so filed the guardian failed to request the allowance of any specific amount as and for attorney’s fees and she only petitioned “that a reasonable allowance be made for attorney’s fees.”

At the hearing, the testimony of seven duly licensed and practicing- lawyers, residing in either Anaconda or Butte, Montana, qualified as expert witnesses and gave testimony on behalf of Attorney Emmet T. Walsh, as to what amount, under the circumstances shown to obtain in the instant action, would constitute a reasonable attorney’s fee herein and each of said witnesses was cross-examined by the newly retained counsel then and there representing Martha Heaphy, the guardian.

In addition to the above expert testimony it was brought out at the hearing that there was a district court rule in that particular jurisdiction which set, as the attorney’s fee in a guardianship' proceeding, an amount equal to 5 % of the total amount accounted for in the estate.

After hearing and considering all the evidence submitted at the hearing the Honorable William F. Shallenberger, district judge presiding, made and entered certain findings and an order settling the account of the guardian and determining and authorizing the payment of an attorney’s fee to the guardian’s counsel, the concluding paragraphs whereof read:

“* * * the Court, after hearing the evidence,

“Finds That All Of the statements in the said Account and Report are true and correct; that vouchers have been filed therein; that the total amount that the Guardian herein has accounted for during the period is Two Hundred Nine Thousand Four Hundred Twenty and 12/100 Dollars ($209,420.12) ; and that said Guardian has in her hands belonging to said Estate the sum of One Hundred Ninety-five Thousand Eight Hundred Eighty-four and 26/100 Dollars ($195,884.26) in cash, stocks, bonds and real estate; and it appearing that the Guardian has waived any claim to fee in Open Court, and it appearing that the sum of $10,200.00 is a reasonable and proper amount to be allowed as attorney fees herein to Emmett T. Walsh, Attorney for the Guardian.

“It Is Therefore Ordered, Adjudged And Decreed that the First Annual Account of said Martha Heaphy, Guardian, be and the same is hereby approved, allowed and settled.

“It Is Further Ordered, Adjudged And Decreed that the said Guardian pay to Emmet T. Walsh the sum of $10,200.00 as and for Attorney Fees as Attorney for said Guardian.”

,This is an appeal by Martha Heaphy from that portion of the above-quoted court order determining and allowing the attorney’s fee to appellant’s counsel.

Three specifications of error are listed in appellant’s brief.

Jurisdiction. In her printed brief, the appellant contended that the trial court was without jurisdiction to fix the fee of the attorney for the guardian. On the oral argument of this appeal appellant’s counsel, in open court, abandoned this specification and contention. Clearly such specification had no merit.

Court Buie. In her printed brief, the appellant next contends that the rule of the district court upon which that court based its order was invalid because: (a) it was not published; (b) it is contrary to law; and (e) it is based upon a misconception of the statute relative to guardian’s fees in Veterans’ Administration affairs.

The court rule upon which the attorney’s fee, in the instant case, is based was announced and proclaimed in open court on May 6, 1958, by the Honorable Sid G. Stewart, then the duly appointed, acting and qualified district judge in and for the third judicial district of the State of Montana, wherein is situate all of the County of Deer Lodge. At that time, concerning the rules governing guardianship matters, Judge Stewart said:

“I might say to you gentlemen at this time that there is no Court Rule in this jurisdiction in regard to this matter. The Court Rules that we have at the present time show no rule on it, and I thought it would be well to establish a rule at this time.

“I would like also for the record to show that in addition to the testimony received before the Court in this matter that the Veterans’ Administration also allows a five percent fee for the guardian and attorney, and the Court believes that that is an adequate and proper fee for both, and will adopt that as a Court Buie for this Court from now on.”

None of the contentions here made and presented by the appellant on this appeal respecting this court rule was raised in the district court and such court rule was introduced in evidence in the district court in the instant proceedings without objection.

Notwithstanding these facts we shall here consider appellant’s contentions concerning the rule. First appellant contends the rule was not published as required by R.C.M. 1947, § 93-503, which states: “Rules adopted by any court take effect thirty days after their publication.”

The mode of “publication” of court rules is not prescribed by the Montana statutes. Publication may be accomplished by the performance of any one of the various acts constituting publication as generally defined and understood. Webster’s New International Dictionary (2d ed.), defines publication as “Act of publishing, or state of being published; public notification, whether oral, written or printed; proclamation”.

Thus, on May 6, 1958, when Judge Stewart orally announced and proclaimed, in open court, that the 5 percent rule would be the court rule in his court he then and there “published” the rule. The rule, governing the attorney’s fee to be allowed in this matter and in other similar matters, had been in full force and effect for over a year prior to the hearing in the instant case.

Next, the appellant challenges the validity of the rule upon the ground that the percentage allowed as a fee, pursuant to the court rule, is an unreasonable amount.

The rule announced and proclaimed shows that the amount of the fee to be allowed is founded upon a standard set up by the Veterans’ Administration in guardianship matters in which the Administration is involved or interested. The question then arises as to whether the standard, so fixed and followed, is reasonable. The appellant urges that the standard set, i. e., 5 percent is a maximum in Veterans’ Administration affairs, but R.C.M. 1947, § 91-4812, provides:

“Compensation payable to guardians shall be based upon services rendered and shall not exceed five percent (5 %) of the amount of moneys received during the period covered by the account. In the event of extraordinary services by any guardian, the court, upon petition and hearing thereon may authorize reasonable additional compensation therefor. A copy of the petition and notice of hearing thereon shall be given the proper office of the veterans’ administration in the manner provided in the case of hearing on a guardian’s account or other pleading. No commission or compensation shall be allowed on the moneys or other assets received from a prior guardian nor upon the amount received from liquidation of loans or other investments. ’ ’ Thus the 5 percent, while a maximum amount, is generally accepted and has received legislative sanction. Appellant argues that this amount is unreasonable and appears disproportionate when the ward’s estate is of substantial value, but in view of the expert testimony and other evidence submitted to the trial court we find no merit in such contentions.

The last point urged by the appellant is that the trial court in adopting its rule has misconstrued the statute, R.C.M. 1947, § 91-4812, supra, and that the 5 percent figure is a maximum applicable to income only. A reading of District Judge Sid G. Stewart’s proclamation shows that he used the Veterans’ Administration rule solely as a guide. He never exceeded the maximum there set out, he established it as his rule. We cannot see where the setting of a fee at the maximum amount generally is erroneous. There is no rule requiring that the amount be set at a minimum figure. As applied by Judge Stewart when he proclaimed the rule, the amount was based upon corpus and income reported. A reading of section 91-4812, supra, amply supports this interpretation of the statute. It states “money received” which generally includes both “corpus” and “income”. We so interpret the statute.

We find no merit whatever in any of appellant’s contentions challenging the validity of the district court’s rule. The rule was in full force and effect at the time that this hearing was held, and the Honorable William F. Shallenberger, a duly elected, qualified, and acting judge of the fourth judicial district, called in to preside because of the disqualification of Judge Stewart, followed the court rule which prevailed in the jurisdiction wherein the hearing was held as he should and he correctly set and determined the attorney’s fee pursuant to that rule.

Since the judgment rendered by Judge Shallenberger was based upon the court rule which controlled the issue before the court in which he was then presiding, the question of whether the fee was shown to be reasonable is not now before this court. Notwithstanding, appellant’s brief devotes considerable argument to that point, hence, we direct attention to the record before us on this appeal which contained an abundance of evidence which establishes that the fee allowed herein was and is a reasonable one.

Splendid Services Rendered. At the hearing before Judge Shallenberger the guardian and appellant, Martha Heaphy, testified as follows:

“Q. Of course, now, there is absolutely no objection, as far as you are concerned, that Mr. Walsh be reimbursed for any costs that he has advanced in this estate, is that right? A. I definitely think that he should have a fair reimbursement, by all means. I think that he did a very fme job in compiling it, and I think that everybody should be paid for their work.

“Q. Except yourself? A. Well, I feel that —■ you know, school teachers are never paid.

“Q. And you have always insisted that you intend to waive your fee in this matter? A. Yes. All that I am asking for is just the actual money that I have expended.

“Q. Just what you have expended? A. Yes. * * *

“Q. I believe you stated that you felt that Mr. Walsh not only should be reimbursed for the expenses that he had advanced in the guardianship, but you also definitely feel that he is entitled to a fee for the splendid services that he has rendered, is that correct? A. Would you state that again, please?

“Q. You stated a minute ago that you felt that Mr. Walsh was entitled, not only for the expenses that he had advanced in the guardianship, but you, also definitely feel that he is entitled to a fee for the splendid services that he has rendered this guardianship estate? A .Yes, I do.”

The evidence submitted amply supports the fee allowed and there was and is no evidence that in a guardianship matter of this magnitude and proportion, a lesser fee would have been reasonable. The fee allowed by the district court from the evidence produced, if judged on the basis of reasonableness, was and is the minimum fee, “for the labourer is worthy of his hire.”

District Judge Shallenberger, fixing and allowing the fee upon the basis of the court rule, ably summed up the evidence and the basis for his ruling when he said:

‘ ‘ This is not just a case of a lot of lawyers testifying and buttressing and ganging up upon some poor incompetent’s estate, as I see it, but is simply the case of a rule which has been enunciated, and has been in operation in the district here.”

The order of the district court setting and allowing the attorney’s fee in this matter is affirmed.

MR. JUSTICE ANGSTMAN and THE HONORABLE W. W. LESSLEY, District Judge, sitting in place of MR. JUSTICE BOTTOMLY concur. MR. CHIEF JUSTICE HARRISON and MR. JUSTICE CASTLES dissent.