Estate of Mittman, Matter of

• Decision Date: 06 October 1986
• Citation: 123 A.D.2d 631,506 N.Y.S.2d 899
• Parties: In the Matter of the ESTATE OF Max MITTMAN, deceased. Yaffa Schlesinger as Executrix, etc., Appellant; Donald Snider, as Administrator C.T.A., Respondent.
• Court: New York Supreme Court — Appellate Division

Page 899

506 N.Y.S.2d 899

123 A.D.2d 631

In the Matter of the ESTATE OF Max MITTMAN, deceased Yaffa Schlesinger as Executrix, etc., Appellant Donald Snider, as Administrator C.T.A., Respondent.

Supreme Court, Appellate Division Second Department.

Oct. 6, 1986.

Ruth H. Schlesinger, New York City, for appellant.

Finley, Kumble, Wagner, Heine, Underberg, Manley, Myerson & Casey, New York City (Donald S. Snider and Douglas F. Allen, Jr., of counsel), for respondent.

Before BRACKEN, J.P., and BROWN, NIEHOFF and EIBER, JJ.

MEMORANDUM BY THE COURT.

In a proceeding to fix commissions of a deceased fiduciary, the petitioner appeals from a decree of the Surrogate's Court, Queens County (Laurino, S.), dated May 2, 1985, which dismissed the petition.

Decree reversed, on the law and the facts, without costs or disbursements, and matter remitted to the Surrogate's Court, Queens County, for a hearing and determination on the issue of the value of the services rendered to the estate of Max Mittman, the amount not to exceed statutory compensation on the 24% of the stock as to which the deceased fiduciary carried out necessary executorial functions (see, SCPA 2307).

The estate of Max Mittman consisted almost entirely of his closely held corporation M. Mittman & Co. Upon his death on September 19, 1977, Mittman bequeathed 24% of the corporation's shares of stock outright to his son Bernard Mittman, 24% in trust for the benefit of his daughter, Alice Agrin, and the rest, along with the residue of the estate, in trust for the benefit of his wife Frieda Mittman. As coexecutors and cotrustees of the two trusts he named his son, his accountant Arthur Meyers, and his attorney Martin Schlesinger. After Max Mittman's death Bernard Mittman took charge of running the company.

The shares of stock were neither marshaled nor distributed by the executors. However, in early 1981, coexecutors Schlesinger and Meyers filed a petition to compel Bernard Mittman to render an accounting, liquidate corporate assets and fund the trusts, alleging that Bernard had utilized estate assets for his own benefit to the detriment of estate beneficiary Alice Agrin. The petitioner explains, and no one disputes, that it was necessary to postpone filing the petition until completion of Federal estate tax proceedings.

Schlesinger's failure to marshal and distribute the shares of stock does not appear to reflect dereliction in the performance of his fiduciary duties, such as would support a denial of commissions (see, Matter of Smith, 91 A.D.2d 789, 791, 458 N.Y.S.2d 72). Indeed, distribution of stock certificates would be an empty gesture if the trusts into which they are to be placed will remain, as a practical matter, unfunded by more than those pieces of paper. Part of Schlesinger's obligation as coexecutor was to ensure that the corporation was operated so as to benefit all the estate beneficiaries, and to fund the provided-for trusts.

Moreover, the Surrogate found Schlesinger's proceeding to compel Bernard Mittman to account to be meritorious, and assented to the claim that the trust should be funded. Th...