Dickerson v. Camden Trust Co.

Citation64 A.2d 214
Decision Date28 February 1949
Docket NumberNos. A-50, A-82, A-89.,s. A-50, A-82, A-89.
PartiesDICKERSON et al. v. CAMDEN TRUST CO. et al.
CourtUnited States State Supreme Court (New Jersey)

OPINION TEXT STARTS HERE

Appeal from former Court of Chancery.

Suit by E. Stuart Dickerson, Jr., and others against the Camden Trust Company, a corporation of the State of New Jersey, and Woodward Tingle Dickerson, individually and as executors and trustees under the last will and testament of Edwin Stuart Dickerson, deceased, for construction of the will, for a decree directing defendants to make discovery of the assets of the estate, for an accounting, and for surcharge against the defendants because of losses sustained on account of investment of estate's assets in alleged non-legal securities. From an adverse decree and order, 140 N.J.Eq. 34, 53 A.2d 225, the defendants appeal, and the complainants cross-appeal.

Decree modified and, as modified, affirmed, cause remanded, and order affirmed.

Albert McCay, and Powell & Parker, all of Mount Holly, for plaintiffs-respondents E. Stuart Dickerson, Jr., and others.

Saul J. Zucker and Kristeller & Zucker, all of Newark, for plaintiffs-appellants E. Stuart Dickerson, Jr., and Elizabeth E. Dickerson.

Frederick P. Greiner and Grover C. Richman, Jr., both of Camden, for defendants-appellants Camden Trust Co. and Woodward Tingle Dickerson, as Executors and Trustees.

Boyle, Archer & Greiner, Grover C. Richman and Walter R. Carroll, all of Camden, for Camden Trust Co. individually.

Douglas Beck Tyler, of Camden, for defendants Margaret W. Dickerson and others.

George W. C. McCarter and McCarter, English & Studer, all of Newark, for defendant-appellant Woodward Tingle Dickerson, individually.

VANDERBILT, Chief Justice.

The several appeals in this cause stem from a decree of the former Court of Chancery surcharging the defendants Camden Trust Company and Woodward Tingle Dickerson by reason of their administration of the estate of Edwin Stuart Dickerson, deceased.

The decedent died on October 9, 1930, leaving a will executed in August, 1930, in which he designated the Camden Safe Deposit and Trust Company, the predecessor of the Camden Trust Company, and his son, Woodward Tingle Dickerson, executors and trustees of his estate. After making several relatively small bequests and disposing of his residence and household effects, the testator gave the residue of his estate to his executors, in trust, ‘to invest said estate in legal securities and from the income therefrom arising to pay’ certain annuities to his widow and two sons, other relatives and employees, with gifts over of the principal upon stated contingencies.

Almost immediately after qualifying, the defendant executors and trustees took possession of the assets of the estate, which consisted of realty and personalty valued at $526,430.46 as of the date of death. The great bulk of the personalty, amounting to more than $490,000, was composed of bonds, stocks, notes and other investments, purchased by the testator during his lifetime, which were not legal investments for fiduciaries in this State. Although general economic conditions, both preceding and following the commencement of the administration of this estate, were such that the value of securities of the type constituting the assets of the estate was rapidly declining, the executors, notwithstanding the direction contained in the will, retained almost all of the securities without making any attempt to dispose of them. Indeed, upon the conclusion of their administration as executors, the defendants turned over to themselves as trustees the greater part of these securities which, with minor exceptions, they still held at the time the present suit was instituted.

The executors filed their first accounting in December, 1931, and their second and final accounting in June, 1934, in the Camden County Orphans' Court. In the statement of assets annexed to each of the accounts, the executors set forth a complete schedule of the securities held by the estate, listing them, however, at the inventory value at the date of the testator's death. Thus, while the market value of the estate assets had depreciated to approximately $190,000 as of the date of filing the final account, it carried them at $330,000. Although this appears to have been the practice prevailing in those years, it should be noted in passing that, since the 1941 revision of the rules of the Prerogative Court and of the Orphans' Court, it has been incumbent upon an accountant to set forth in the statement of assets the true value of the assets of the estate, as well as the inventory value, Prerogative Court Rule 35; Orphans' Court Rule 27; Rule 3:95-2. All parties in interest, including the complainants, were duly notified of the filing of both accounts, but no exceptions were taken with respect to the propriety of the retention by the executors of the non-legal investments. The decree allowing the final account charged the executors with the sum of $330,567.20 as being in their hands which, after the payment of commissions and counsel fees totalling $12,000, was ‘to be disposed of according to law.’

Upon the allowance of their final account as executors, the defendants turned over to themselves as trustees all of the assets of the estate, accepting them at inventory value instead of the then depreciated market value. On November 21, 1938 they filed their first account as trustees, scheduling and charging themselves with the assets of the estate at inventory value, again as of the date of the testator's death. Prior to the allowance of this account, the present suit was commenced by several of the cestuis, seeking in essence to surcharge the defendant fiduciaries for the losses accruing to the estate as a result of the decline in value of the non-legal investments. The former Court of Chancery thereupon assumed general jurisdiction of the administration of the estate and trusts under the will of the testator and directed the removal to it of the proceedings under the trustees' first accounting, then pending in the Camden County Orphans' Court.

The final decree advised by the learned Vice Chancellor ordered the immediate sale and conversion of all the non-legal securities remaining in the hands of the trustees and the investment of the proceeds into authorized securities, and surcharged the defendant trustees for the difference between the value at which the non-legal securities had been accepted by them on taking over the assets as trustees and the sum actually received from the sale of said securities, as well as for the consequent loss of income. The decree further provided for the allowance to the trustees of income and corpus commissions, and for the allowance of fees and expenses, payable out of the estate, to counsel for the complainants, counsel for the defendants as fiduciaries and counsel for the defendant beneficiaries. A separate application by the complainants E. Stuart Dickerson, Jr. and Elizabeth E. Dickerson for reimbursement of out-of-pocket expenses allegedly incurred as incident to the preparation for and the prosecution of this litigation was denied.

The defendant fiduciaries appeal from those portions of the decree directing the sale of the non-legal securities and reinvestment of the proceeds, imposing the surcharge, and granting a fee to counsel for complainants. A cross appeal has been taken by the complainants, challenging the allowance out of the estate of costs and fees to counsel for the defendant fiduciaries and to counsel for the defendant beneficiaries. An appeal from the allowance of income and corpus commissions to the trustees has been abandoned. Appeal has also been taken by the complainants E. Stuart Dickerson, Jr. and Elizabeth E. Dickerson from the denial of their application for reimbursement for out-of-pocket expenses.

It is the position of the defendant fiduciaries that, under the terms of the will and the applicable statutes, they were authorized to retain any non-legal investments which were made by the testator and received by them as part of the assets of the estate. Although it is true that under the provisions of the law in...

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24 cases
  • American Nat. Bank of Beaumont v. Biggs
    • United States
    • Texas Court of Appeals
    • 11 Marzo 1954
    ...royalties as corpus, but you must pay the fees out of your corpus for those who would have dissipated it. '' Dickersn v. Camden Trust Co., 1 N.J. 459, 64 A.2d 214 proceeds on a ground somewhat different from those stated in the three decisions just At least some of these decisions appear to......
  • Fraser v. Southeast First Bank of Jacksonville
    • United States
    • Florida District Court of Appeals
    • 7 Julio 1982
    ...Gray, 9 Mich.App. 262, 156 N.W.2d 594 (Ct.App.1967); In Re Bailey's Trust, 241 Minn. 143, 62 N.W.2d 829 (1954); Dickerson v. Camden Trust Co., 1 N.J. 459, 64 A.2d 214 (1949); In Re Van Deusen's Will, 24 Misc.2d 611, 196 N.Y.S.2d 737 (Sur.Ct.1960); 3 A. Scott, Trusts § 220, at 1765 (3rd ed. ......
  • Ditmars v. Camden Trust Co., 139
    • United States
    • New Jersey Superior Court
    • 4 Octubre 1950
    ...apparent on the face of the account.' See also Pollack v. Bowman, 139 N.J.Eq. 47, 49 A.2d 40, (E. & A.1946); Dickerson v. Camden Trust Co., 1 N.J. 459, 64 A.2d 214, (Sup.Ct.1949). Both because of the plaintiffs' failure to raise these questions in their original suit and because the prior j......
  • Brauburger v. Sheridan
    • United States
    • New Jersey Superior Court
    • 29 Marzo 1950
    ...were acquired or since the date of the last account, together with the dates when the changes were made.' Dickerson v. Camden Trust Company, 1 N.J. 459, 464, 64 A.2d 214 (Sup.Ct.1949). The requirements of the rule should be obeyed in the present Such a statement is now regarded as a part of......
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