Coates' Estate, In re

• Decision Date: 17 December 1959
• Docket Number: SEATTLE-FIRST,No. 34370,34370
• Citation: 347 P.2d 875,55 Wn.2d 250
• Court: Washington Supreme Court
• Parties: Matter of the ESTATE of Agnes M. COATES, Deceased. Evleen McGILCUDY, Respondent, v.NATIONAL BANK, as Executor, Appellant.

Page 250

55 Wn.2d 250

347 P.2d 875

Matter of the ESTATE of Agnes M. COATES, Deceased.

Evleen McGILCUDY, Respondent, v. SEATTLE-FIRST NATIONAL BANK, as Executor, Appellant.

No. 34370.

Supreme Court of Washington, En Banc.

Dec. 17, 1959.

Barker & Day, William J. Walsh, Jr., Seattle, for appellant.

Lester Stritmatter, Hoquiam, for respondent.

DONWORTH, Judge.

Agnes M. Coates died testate in Aberdeen, Washington, on August 14, 1952. The terms of her will, dated November 25, 1949, directed that all of her estate (originally appraised at $136,509.04) be distributed to her sister, respondent herein. The testatrix appointed appellant as executor, to serve without bond and without the intervention of the court.

On December 11, 1952, upon appellant's petition, the will was admitted to probate in the superior court for Grays Harbor county, and appellant qualified to act as executor.

Respondent, on May 11, 1956, petitioned the court for an order directing that appellant appear before the court and show cause why a final account should not be submitted and why the actions of appellant in the handling of this estate should not be subjected to review and approval or disapproval by the court.

In her petition, respondent alleged, in part, as follows 'That on or about November 25, 1949, the said Agnes M. Coates was advised and counselled by the trust officers of said bank with respect to the drafting of a will for the benefit of this petitioner; that said officials then accompanied the testatrix to the offices of Barker and Day, Attorneys at Law, whose offices were directly above the bank, for the purpose of drafting a will.'

And, further:

'That your petitioner is informed and alleges and believes that during the course of this probate the said Executor has paid itself the sum of $7500.00 as Executor's fees and its attorneys the sum of $7500.00 as attorney's fees; that said estate was inventoried and appraised at the sum of $136,509.04 and that the minimum bar schedule of Grays Harbor County provides as attorney's fees of $4250.00 and an Executor's fee of $2125.00; that the fees as allowed and paid by the Executor, if true, are so exhorbitant as to amount to a misuse of the trust placed in said executor by the deceased and to amount to a fraud upon the estate.'

Appellant appeared specially and moved to quash the petition on the ground that the court was without jurisdiction of the subject matter. This motion was denied. After the denial of other preliminary motions, appellant answered the petition, admitting that it had paid itself $7,500 as executor's fees and a like amount to its attorneys as fees for their services, but generally denying respondent's averments of bad faith. In its answer, appellant alleged that all of the remaining assets and been delivered to respondent on June 25, 1956, in final distribution and that the estate was, in all respects, closed.

The issues joined by appellant's answer were brought on for hearing before the probate court on August 16, 1956. At the commencement of this proceeding, counsel for respondent stated:

'The main question before the Court now is whether the fees are excessive under the circumstances, and whether the Court has jurisdiction.'

At the conclusion of the hearing on that day, the court stated:

'* * * I have heard enough this afternoon that I am satisfied that the work done by the executor, that is, from the time the executor took charge of the estate until it was completed, it was well done. There is no longer any question about that. I am satisfied that it was done carefully and that it was well done and the welfare of the estate was kept in mind at all times.'

However, further proceedings were thereafter had for the reception of evidence on other matters, particularly that relating to the reasonableness of the amounts of the executor's and its attorneys' fees, paid by appellant and charged against the estate.

After rendering its memorandum opinion, the trial court, in findings Nos. 6 and 7, found, in part:

'* * * By the time of the hearings the executor had completed its duties and turned the residue of the estate over to the heir, retaining a $7500.00 fee as executor and a $7500.00 fee for its attorneys. The only problem for the court remaining as a result of the hearings is the question of the reasonableness of the fees. The executor has objected to the authority of the court to assume jurisdiction in this matter. The Court finds from the record that this estate has been handled only partially as a non-intervention estate. Consequently the Court feels it has been invested with jurisdiction by the executor itself. In addition the Court finds the fees claimed and withheld both for the executor and the Attorneys is excessive to the point that this court must assume jurisdiction.

'Under the fee schedule in Grays Harbor County which the Court feels must govern in this case, the normal attorney's fee would be $4250.00 and the executor's fee $2125.00. Testimony of local attorneys is to the effect that the fees claimed and withheld were excessive. The Court has elected to accept their testimony.'

The court did, however, find that the attorneys performed additional services beyond the usual legal work required for an estate of this size and character, and consequently allowed an additional $1,000 (above the minimum fixed by the local bar schedule), or a total of $5,250 for legal services rendered to the executor. Appellant executor was found to be entitled to $2,000 for additional services performed by it (beyond those contemplated under the fee schedule), and a total fee of $4,125 was, therefore, allowed appellant for its services.

From the decree directing that the fees in excess of these respective amounts be refunded to the estate and distributed to respondent, the executor has appealed.

The critical assignments of error are directed to the court's findings of fact under which it assumed jurisdiction and proceeded to determine the reasonableness of the above mentioned fees. Appellant has steadfastly maintained that, in the absence of its application to the court for a determination of these fees--and there had been none--the probate court is without jurisdiction to determine them, or to either approve or disapprove the amounts paid by appellant to itself or its attorneys.

The finding that this estate has been handled only partially as a nonintervention estate is based, in part, on the fact that certain creditors' claims against the estate were presented by the executor to the probate court for approval.

These claims were all approved by appellant and the court and were paid by appellant prior to the filing of its petition for the court's order of solvency and the entry of that order on August 27, 1953.

RCW 11.68.010 provides, in part:

'In all cases where it is provided in the last will and testament of the deceased that the estate shall be settled in a manner provided in such last will and testament, and that such estate shall be settled without the intervention of any court or courts, and where it duly appears to the court, by the inventory filed, and other proof, that the estate is fully solvent, which fact may be established by an order of the court on the filing of the inventory, it shall not be necessary to take out letters testamentary or of administration, except to admit the will to probate and to file a true inventory of all the property of such estate and give notice to creditors and to the body having charge of the collection of inheritance tax, in the manner required by law.'

This court, in In re Peabody's Estate, 1932, 169 Wash. 65, 13 P.2d 431, 432, attempted to clearly point out the manner in which the superior court obtained and lost jurisdiction in the administration of estates involving ninintervention wills under this statute. What was there said concerning Mr. Peadody is equally applicable to Mrs. Coates, the testatrix in the instant case. Concerning jurisdiction of the subject matter, we said:

'To make this clear, let us illustrate: (a) Mr. Peabody in his lifetime made a nonintervention will, but no court then had jurisdiction of his estate. (b) Mr. Peabody died. Still no court had jurisdiction of his estate until, after his death, by proper petition setting up the jurisdictional facts, filed in the superior court of the proper county, that court, by reason of that application to it, obtained jurisdiction of the estate. (c) When the order of solvency was properly entered, the further administration of the estate was by the statute relegated exclusively to the executors, and the probate court, which had before had jurisdiction, then lost its jurisdiction of the estate. (d) Thereafter, in order for the court to regain jurisdiction of the estate, its jurisdiction must be again invoked by a proper application made by someone authorized by the statute so to do, * * *.'

Applying this illustration to the facts of the instant case, we find that the approval of all the creditors' claims by the court was obtained by appellant prior to the entry of the order of solvency, during which time the court had jurisdiction of the estate. It lost jurisdiction automatically by the entry of such order.

Respondent next argues that appellant submitted the subject matter of the estate to the jurisdiction of the court by filing exceptions to the appraisement of the estate (for the purpose of state inheritance taxes) under the provisions of RCW 83.16.040. This statute provides the only manner for taking exceptions to the appraisement of the estate, made by the appraisers, for the purpose of state inheritance tax. By so doing, appellant was able to maintain the matter 'in litigation' and to make a subsequent adjustment of the state inheritance tax in accordance with a settlement which was effected with the Federal estate tax supervisor. This procedure was solely for the benefit of the estate and cannot be construed as an abdication by the...