In re the Assignment of Bicknell

31 Misc. 302, 64 N.Y.S. 360
CourtNew York Supreme Court
DecidedApril 15, 1900
StatusPublished
Cited by2 cases

This text of 31 Misc. 302 (In re the Assignment of Bicknell) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re the Assignment of Bicknell, 31 Misc. 302, 64 N.Y.S. 360 (N.Y. Super. Ct. 1900).

Opinion

Fobbes, J.

This proceeding was instituted, by the assignee, for a final accounting and distribution of the assets in his hands, under an assignment for the benefit of creditors, and for the passing of his accounts for commissions,, expenses and money advanced for attorney and counsel fees.

The inventory, filed with the county judge of Madison county, shows that the actual value of the assets coming into the hands of the assignee was about $3,500. Their nominal value was something over $4,000.

The Rational Bank of Waterville is a creditor to the extent of $4,016, based on ten promissory notes, held by said bank at the time of said assignment. These notes were made by Burton, as maker,- and were indorsed by Bicknell, the assignor. The bank also held, [304]*304as collateral security, a real estate and a chattel mortgage on certain personal property and the real estate of the maker.

Subsequent to the filing of this claim, these mortgages were duly foreclosed and the proceeds thereof, amounting to $1,650, $153.27 of which was for costs, were received by said claimant some time in December, 1896; leaving a balance due and unpaid on the indebtedness, after deducting said costs, in the sum of $2,519.27.

The attorney for the Rational Bank of Waterville made the claim against the Bicknell estate and placed the same in the hands of the assignee, about May 2, 1896, for the whole amount of its claim against Burton, as maker of said notes, and against the assignor as the accommodation indorser thereon.

This claim was before, but was never passed upon by, the county judge, who died while said proceeding was pending, after certain steps were taken before him, in reference to- filing claims by the assignor’s creditors. Hon. John E. Smith, who subsequently, on the death of Judge Kennedy, became county judge, was the attorney for a claim presented against said estate, in behalf of the Rational Bank of Morrisville; this deprived him of jurisdiction to hear and determine this accounting. The assignment was made about the 15th day of April, 1896.

After the Hon. John E. Smith became county judge of Madison county, he certified his disability to hear this proceeding, and sent the accounting, together with all the proceedings in the County Court, to this court for final determination.

After some contest, this court permitted the claim of the Rational Bank of Waterville to be refiled in this proceeding, and its claim is the only one about which there has been any litigation in this or any other court.

After hearing the parties, the court duly passed upon the claim of the Rational Bank of Waterville and allowed it for distribution to the full amount of said claim, and interest thereon, to be computed as in the other claims presented.

A motion was subsequently made by the assignee’s attorney to modify that order. After hearing counsel for each contesting party that decision was, by consent, reserved to be determined on the final accounting.

I am convinced that the case of People v. Remington, 121 N. Y. 329, and the case of Matter of Binghamton General Elec. Co., 143 id. 261, are not adverse to the claim of the Rational Bank of [305]*305Waterville, for the reason that when that claim was made and filed, nothing was due, or had been collected, or conld have been applied from the securities so held by said claimant.

While the assignor was an accommodation indorser for Burton, who was the maker of said notes under which the claim arose, still the case Matter of Sawyer, Wallace & Co., 33 App. Div. 300, docs not apply; and the distinguishing difference between that and the two authorities, supra, in the Court of Appeals, does not exist in the case at bar. In each of those cases the claims were against the principal debtor. In the case reported in 33 App. Div. 300, the claim was filed against an accommodation indorser, who made the indorsements for the principal debtor or maker of these notes. An examination of the case shows, however, that the payment and application had already been made, at the time the claim was filed, and that the indorser then had a right and was bound to .■credit all the payments made by the principal in partial liquidation ■of the claim there presented.

The action and proceedings to foreclose the securities in question were not begun until after the claim was filed, and the judgment was not perfected until the following December. I do not think the assignee should let this matter run along from 1896 to the present time, and then claim the application of the payments which have been made since the claim was filed and the rights of the parties thereby fixed. Again, the dividend to be received on the final settlement will pay no considerable portion of the original claim, and is of little importance in the final distribution.

The other question presented is the amount which should be allowed to the assignee for expenses, attorney and counsel fees. The estate is very small and the amount to be distributed, after the ■expenses of the assignment are deducted, is very limited.

The total amount of assets now available is the sum of $1,123.18. If any reasonable amount is to be allowed for commissions an8 ■expenses of the assignee and attorneys’ fees, less than half of this •sum will remain to be distributed.

The attorney and counsel undoubtedly have performed a good ■deal of labor in this case; an itemized statement of their expenses •and the value of their services amounts to a sum which, if allowed, would quite absorb the entire assets of the estate. It is conceded, ■on the part of the attorney and counsel, that they cannot be paid ■in full; an adjustment was sought to be made with the assignee [306]*306to accept the sum of $500 in full for all services rendered by them to said estate.

While this court would prefer to be liberal in the payment of counsel and attorney fees, in all cases where the amount of the estate will warrant it, and the labor has been actually performed and the fees earned, as in this case, still I do not think that it is the policy of the law, in the settlement' of small estates, to award the payment of liberal or even adequate attorneys’ fees. It is the duty of the assignee to do all the clerical work himself. He was not warranted in the employing of an attorney to do this kind of work, and then charge the estate ¡with such compensation to his attorney.

In this case the attorney and counsel are father and son, and I cannot conceive the necessity for two classes of legal services in an estate of this size and character. While I am impressed with the belief that a large amount of labor has been performed in this case, I am not unmindful of the fact that estates for the benefit of creditors cannot be absorbed in commissions and attorneys’ fees and expenses.

In assignments for the benefit of creditors, there can be no distinguishing difference in the rule to be applied between these estates and the estates of deceased persons, in reference to the legal expenses, fees and commissions which ought to be allowed. I think the principle laid down in Matter of Jones, 28 Misc. Rep. 599, is applicable; the same doctrine was affirmed in the case of Randall v. Packard, 142 N. Y. 47, and was also previously passed upon in the case of People v. Bond St. Sav. Bank, 10 Abb. N. C. 15. In the case first cited, the amount of the assets was $8,000, and the amount of the fees paid to the attorneys was about one-half that sum.

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31 Misc. 302, 64 N.Y.S. 360, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-assignment-of-bicknell-nysupct-1900.