In re the Judicial Settlement of the Account of Waters

183 A.D. 840, 171 N.Y.S. 897, 1918 N.Y. App. Div. LEXIS 6127
CourtAppellate Division of the Supreme Court of the State of New York
DecidedJuly 11, 1918
StatusPublished
Cited by13 cases

This text of 183 A.D. 840 (In re the Judicial Settlement of the Account of Waters) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re the Judicial Settlement of the Account of Waters, 183 A.D. 840, 171 N.Y.S. 897, 1918 N.Y. App. Div. LEXIS 6127 (N.Y. Ct. App. 1918).

Opinion

Dowling, J.:

Frank E. Waters died at the city of New York, intestate, on September 3, 1906. His mother, Elizabeth Ann Waters, was appointed administratrix of his estate on November 24, 1906. He left him surviving as next of kin his mother, four brothers (William H., Martin J., Raymond H. and Howard P.) and three sisters (the respondents Gertrude G. Blake and Genevieve G. Platt [formerly Waters] and also Elizabeth A. [referred to as Bessie] Waters). Deceased had been engaged in business for about five years, in partnership with William H. [843]*843Waters, under the firm name of Frank E. Waters & Bros., dealing in hatter’s fur, decedent’s interest being two-thirds, that of his brother one-third. The family all lived together except a daughter who went to boarding school, and their household expenses were all paid from the firm funds, save certain amounts which were paid weekly by decedent. The payments thus made practically exhausted all the profits of the business. The net value of the business as of August 31, 1906, a few days before decedent’s death, has been computed from the books at $1,659.13. The net earnings for the last seven months of 1905 were but $1,233.72, while the amount drawn for the expenses of the household during that period was $1,481.05, and the partners’ accounts were debited with $1,976.52, leaving a debit against capital account for that time of $2,223.85. After the administratrix had qualified the condition of the business was such that upon a winding up of ■ its affairs but little would have been available for distribution among the next of kin. Therefore, an agreement was entered into between the administratrix of the estate (acting by the advice of her counsel) and William H. Waters, the surviving partner, whereby Waters was to continue the firm’s business under the same name and at the same premises, and two-thirds of the profits were to go to the estate while one-third was to go to Waters, who was to receive no salary for his services, nor has he received any. All of the adult next of kin consented to the continuance of the business under this arrangement and accepted money and other benefits therefrom. But the administratrix never received any other authorization to continue the interest of the deceased in the business, and. the continuance thereof was solely the act of the adult next of kin. The family continued to live together, save as to two married children, and the expenses of the household came from the business and were disbursed by the mother, as theretofore. Both of the contestants and respondents herein were of full age at the time of decedent’s death. The family thus lived in apparent harmony, most of them being supported from the business and all of them profiting therefrom. The affairs of the partnership prospered under the direction of Mr. Waters, new customers being found and new avenues of trade being developed, so that from the. time [844]*844of decedent’s death until December 17, 1910, the profits aggregated $38,479.74. For the three years preceding December 17, 1910, the average annual profits were $9,054.04, whereof the estate’s two-thirds amounted to $6,036.03. On December 17, 1910, and, as is claimed, after thorough discussion and complete understanding of the terms and conditions of the proposed arrangement by all the adult next of ldn, an agreement in writing was entered into by all of them, under seal and duly acknowledged. The only persons interested who did not join in the execution thereof were Elizabeth A. (“ Bessie ”) Waters and Howard P. Waters, who were still minors, but they also had full knowledge of the agreement. Thereunder, after recitals of the various steps in the administration of the estate, of -the support and extent of expenditures for the household, of the advances to the various next of kin, of the receipts of certain amounts from a .life insurance policy and the sale of an automobile, there was a statement of the amounts due to the various next of kin, set forth in detail, and a further statement that the parties interested had agreed that after payment of such amounts by William H. Waters, the business should thereafter be his and be carried on for his sole benefit and that all the parties would execute to him an assignment of all their shares therein and a release of their claims, while it was further recited that William H. Waters had agreed to pay his mother for life the sum of $40 per week, in discharge of all her claims against him in respect of the said partnership and of the good will thereof.” The agreement as to the minors Howard P. Waters and Elizabeth A. Y/aters was subject to the approval of the surrogate of New York county. The agreement then provided in the most formal and complete manner, for the purpose of adjusting and settling all differences and disputes as to the proper division of the assets of the decedent, that (1) inasmuch as the minor Elizabeth A. Waters had been at boarding school and had not had the full benefit of the expenditures of $10,307.50 paid to support the household, each of the other next of kin should contribute the sum of $150, making in all $1,050, which was to be paid to her in addition to a balance due her of $260.59; (2) out of the share of Howard P. Waters was to be deducted the sum of $400 [845]*845to be paid his mother for her services in managing the household, two of his brothers having already paid similar amounts; (3) there was further to be deducted from the share of Howard P. Waters the sum of $100 for money advanced him by ¥/illiam H. Waters; (4) there was to be deducted from the share of Genevieve G. Waters the sum of $500, to be paid to the mother for her services in managing the household, the balance to be held in trust for said daughter, who was to board with the mother and be supplied by her with $3 a week for other expenses, while if the daughter married within two years the principal was to be paid to her at once, less any advances; (5) William H. Waters agreed to pay his mother $40 a week for life; (6) the claims against the estate, commissions of administratrix and expenses of administration were to be deducted in equal part for the shares of the next of kin; (7) William H. Waters and Gertrude G. Blake waived all claims to any contributions from the other next of kin because the two children named had not shared fully in the benefits accruing from the maintenance of the household out of the estate funds and had not shared at all in the distribution of a further sum of $3,763; (8) Martin J. Waters waived any claim to contribution because he had not been at home for some months; (9) Raymond H. ¥/aters was to have the option of leaving the balance of his share in the business, if William H. Waters so agreed; (10) the parties further admitted that the partnership accounts of the said William H. ¥/aters, as herein ascertained, are correct, and they agree that they will, on payment of the sums due to them, as ascertained by this agreement, and in consideration of the payment of the .sum owing to said administratrix, execute an assignment to the said William H. Waters of all their shares and interests in the said partnership business, and the good will thereof, by which assignment they will release the said William H. Waters from all further claims in respect of the said business and covenant not to molest or trouble him in the future, or request any payments of moneys out of the said business, nor interfere with him in the conduct of said business, and they and each of them agree that they will endeavor to procure the execution of a similar instrument by the general guardian of said minors when appointed;” (11) the agreement was expressly made [846]

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Bluebook (online)
183 A.D. 840, 171 N.Y.S. 897, 1918 N.Y. App. Div. LEXIS 6127, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-judicial-settlement-of-the-account-of-waters-nyappdiv-1918.