In re the accounting of Scott

53 How. Pr. 441
CourtNew York Court of Common Pleas
DecidedSeptember 15, 1877
StatusPublished
Cited by1 cases

This text of 53 How. Pr. 441 (In re the accounting of Scott) is published on Counsel Stack Legal Research, covering New York Court of Common Pleas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re the accounting of Scott, 53 How. Pr. 441 (N.Y. Super. Ct. 1877).

Opinion

Robinson, J.

The present motion is made upon the report of Stephen H. Olin, referee, appointed under an order dated May 25, 1877, whereby the accounts of said William L. Scott, assignee of Kenyon, Cox & Co., and also the account of David Dows as special trustee, and the vouchers, were referred to him to take and state the same.

The proceeding for such accounting originated upon the petition of John F. Tracy, a creditor of the assignors, to the extent of some $134. Upon the return of that application, the assignee obtained an order for a final accounting and the issuing of a citation to the creditors, and on proof of due service upon the creditors personally, or by publication on the return day, the order of reference to Mr. Olin was made.

[444]*444The proceedings of the assignee appear to have been regularly conducted throughout, none of the creditors having intervened in the matter to make any opposition to the proceedings or accounts of the assignee on the accounting.

The referee proceeded to take and state the accounts as required by the order of reference, and as authorized by the amendment to section 4 of the act of 1860 (chap., 348), as made by chapter 56 of Laws of 1875. ISTo objection is now made by any creditor to the proceedings- of the assignee, or to any item of such statement of their said accounts, as thus settled by the referee. Pending the proceedings before the referee commenced under the act of 1860 and its amendments, the act of June 16, 1867 (chap. 466), repealing and superseding it had gone into effect, by section 28 of which any proceeding thereafter had or- pending under the previous acts was to be continued under its provisions. Otherwise, as a repeal of the former act, it went into immediate effect. It constituted this court (sec. 25), in respect to such assignments, a court of general jurisdiction, affirming and continuing (sec. 20, sub. 3) the power to appoint a referee to take and state an account of the assignee. Whatever matter that officer has assumed to consider, or to suggest for the consideration of the court beyond taking and stating the account of the assignee, as to receipts and disbursements actually made by him, and his settlements of commissions as established by law (none other having been referred to him), was in excess of any power conferred upon him; and any additional suggestions made by him are entitled to respectful consideration as emanating from one in whom confidence had been placed by the court. Such, however, as are contained in his report, and which the counsel for the petitioning creditor and of the assignee submit for approval in a proposed order or decree, contain some matters that occasion serious ground for question as to the propriety of their recognition. First, that the counsel for the petitioning creditor, to whom less than $150 was due, should be paid $400 for his services in this matter; second, that [445]*445Mr. Dows, the special trustee, whose accounting was, in a measure, involved, and whose legal commissions, at the rate allowed by law to executors and administrators, amount to $3,820.50, should be paid, as a compensation ftir his services, $6,000; third, that the assignee, William L. Scott, instead of $11 392.91, his legal commissions at the like rate, “ should, in consideration of the laborious nature of his duties, and the great skill and fidelity displayed by him,” be paid the sum of $40,000; and fourth, that Tracy, Olmstead and Tracy, the attorneys and counsel for the assignee, for services rendered by them “ in the matter of the accounting, including supervision and preparation of reports of proceeding, petitions for general citation, issue and service of same, and attendance in court and before referee, should” (in addition to $1,000, theretofore paid them by the assignee, and allowed for counsel fee in the matter of the assignment) “be paid the further sum of $10,000.” These claims are in each instance startling, from the large . amounts proposed and claimed as compensation for the services rendered, and suggest the acquisition of fortunes of thousands of dollar's in the happy accident of an employment in the course of the execution of such an assignment. They strike me as excessively exorbitant, and the recommendation of the referee fails to meet my approval or confirmation. The courts, in the distribution of estates intrusted by law to their administration, are, to a great extent, acting for absent creditors or unrepresented parties, who repose with confidence upon the judicial care and watchfulness of the courts, of their interests. No right exists in such tribunals to sequester the money equitably belonging to others, in lavish and injudicious allowances to trustees, or their attorneys or agents, engaged in such administration, or to counsel, who appear in the proceeding for distribution, but they are bound to regard every dollar thus appropriated ag involuntarily exacted and levied from its lawful owner, for the necessary expenses of administration. As to that item in the claim, presented by counsel for the petitioning creditor (whose debt is less than $150) to an allow[446]*446anee of fowr hundred dollars, there is no law or principle of justice, accepted or acted upon by the courts, which justify any such award to him out of these trust funds. The courts are not the almoner of such assigned estates (Devin agt. Perrine, 26 N. Y., 441-449), and while the act of 1877 (chapter 466, section 26), authorizes the court to “ award reasonable counsel fees and costs, and to determine which party shall pay the same,” it does not countenance any idea that the court may distribute otherwise, out of its own motion, any part of the fund of the estate, under the name of counsel fees, to such counsel as have appeared and taken part in its administration (Noyes agt. Children's Aid Soc., 53 How., 10), or to dispense therefrom its favors, according to their appreciation or estimate of the merits or value of counsel of their services, or to act otherwise than upon satisfactory evidence to sustain any allowance it may make. It does not appear that in regard to the claim of the petitioning creditor there was any dispute before the referee in respect to it, which required a trial before him, and the proceeding he instituted was superseded by the intervention of the assignee, under claim of right to a final accounting, and with it the claim of this creditor, so far as appears, was recognized without question or contest. Hothing in the act contemplates the allowance of any costs or counsel fees in the case of a claim thus presented and recognized, “ sub silenio,” or the payment out of the trust fund, or by the assignee personally, of counsel fees, or costs where there was no contest or dispute, or for the preparation or service of a petition that the assignee be called to an account.

Had the assignee been derelict in his duty, or unconscientiously disputed the debt, some equitable ground would have existed upon which a claim might be made for awarding to the successful litigant counsel fees and costs, either personally against the assignee or out of the trust funds. The proceeding he instituted is styled special,” and no costs or rate of counsel fee is provided by law otherwise than on a'n allowance of such taxable costs or allowances as are prescribed by [447]*447the Code (Sec. 309; Laws of 1854, chap. 270; Noyes agt. Children’s Aid Soc., 53 How., 10).

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Bluebook (online)
53 How. Pr. 441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-accounting-of-scott-nyctcompl-1877.