Stern Mayer Co. v. Sabin

253 P. 10, 120 Or. 579, 1927 Ore. LEXIS 24

• Court: Oregon Supreme Court
• Decided: January 11, 1927
• Status: Published

Opinion

BEAN, J. —

It is conceded by both sides and found by tbe trial court that the defendant R. L. Sabin as such assignee could charge a reasonable sum for his services and the expenses of administering the estate. Therefore, the question in the case is, Was the charge made to plaintiff in the aggregate reasonable and fair1? We do not deem it a matter of consequence as to the form or name given to the charges, nor as to whether Sabin was acting in the matter in his official capacity as secretary of the Merchants’ Protective Association. If the office and appliances of the Merchants’ Protective Association were used, and the clerks and stenographers of the association rendered the assignee assistance in administering the estate, then the assignee was warranted in paying the association a reasonable compensation therefor. The uncontradicted testimony shows that the charges made by the defendant assignee to the plaintiff were fair and reasonable.

Both the percentage on the gross amount and the percentage on the net amount is an assignment charge, the only difference being a matter of computation, or the manner of arriving at a reasonable compensation for the services performed. The latter percentage on the net amount paid to plaintiff by the assignee is the amount involved in this case. Both of the items referred to aggregate, as computed by the assignee, to about a 7 per cent “on the recoveries.”

R. L. Sabin, who has had about thirty-five years’ experience in settling such estates, was called as a witness for plaintiff. He testified to the effect, in regard to the estate of Gray, that there were a large number of creditors, liabilities of some seventy or eighty thousand dollars, and a stock of goods badly depleted by sales. It was an embarrassing administra tion of that kind. By diligence the officers and employees of the Merchants’ Protective Association succeeded in getting a highly advantageous sale of the property, and it paid out to creditors better than was anticipated at first; that considering the fact that charges cover the services of the assignee, something for overhead, of rent, stenographers, postage, office expense generally, a gross charge of from 6 to 8, or even 10 per cent, would be reasonable in the matter; that the charge made was less than that.

As stated, this testimony was not disputed. Plaintiff complains that the charges were made under the rules of the Merchants’ Protective Association and that it is not bound thereby. If the charges computed by such rules were not proper charges, the plaintiff would not be bound to allow the same. But the fact of the manner of estimating the charges and expenses would not be material, if a correct result was obtained. That the assignee and the Merchants ’ Protective Association had for a number of years performed like services in administering like estates and had charged for such services according to an adopted rule, would not tend to show that the compensation claimed was not reasonable, but is some indication of the reverse.

The assignee is criticised for the reason that he charged for services rendered as assignee 4 per cent on the net amount to creditors who were not members of the Merchants’ Protective Association, and 2 per cent to members of the association. In effect, the compensation was estimated as follows: Nonmembers charged 4 per cent; members charged 2 per cent, plus dues paid by them, and their support and responsibility for maintenance and operation of the Merchants’ Protective Association, which was estimated equal to 4 per cent.

If there is any error in so arriving at the charges, it is in making the estimate. No inequality in the estimate is shown. It is apparent that merchants and other business men of the City of Portland cannot organize and operate an association like the Merchants’ Protective Association without the expenditure of time and money. When a nonresident of the state, who is not a member of the association, receives the benefit of the valuable services and advantages of the association, through the medium of an assignee, it is only fair that such nonmember pay through the same medium a reasonable amount for the services rendered so as to equalize such charges and expenses, at all times, however, keeping the same within a reasonable figure. It is in evidence that such services have often been rendered and the compensation fixed in the manner mentioned for the merchants of San Francisco, California.

The motion of defendant for a nonsuit should have been granted. The judgment of the Circuit Court will be reversed and the cause will be remanded, with directions to grant the nonsuit.

Reversed and Remanded With Directions.

Burnett, C. J., and Brown and Belt, JJ., concur.