Estate of Trynin

• Decision Date: 27 November 1989
• Docket Number: No. S008320,S008320
• Citation: 264 Cal.Rptr. 93,49 Cal.3d 868,782 P.2d 232
• Court: California Supreme Court
• Parties: , 782 P.2d 232 In re ESTATE OF Esther TRYNIN, Deceased. Richard W. ECKARDT et al., Petitioners and Appellants, v. Marcia D'ESOPO et al., Co-administrators, etc., Objectors and Respondents.

Page 93

264 Cal.Rptr. 93

49 Cal.3d 868, 782 P.2d 232

In re ESTATE OF Esther TRYNIN, Deceased.

Richard W. ECKARDT et al., Petitioners and Appellants, v. Marcia D'ESOPO et al., Co-administrators, etc., Objectors and Respondents.

No. S008320.

Supreme Court of California,

In Bank.

Nov. 27, 1989.

Eckardt & Ruonala, Richard W. Eckardt, Los Angeles, in pro. per.

Kenneth R. Ruonala, Pachter, Gold & Schaeffer, Pachter & Schaeffer, Arnold H. Gold, Judith A. Enright and Robert E. Young, Los Angeles, for petitioners and appellants.

Hufstedler, Miller, Kaus & Beardsley, Joseph L. Wyatt, Jr., Dennis M. Perluss, Lisa A. Christian, Darling, Hall & Rae, Matthew S. Rae, Jr., and Richard L. Stack, Los Angeles, as amici curiae, on behalf of petitioners and appellants.

Marcia D'Esopo, Los Angeles, in pro. per. and for objectors and repondents.

KAUFMAN, Justice.

Probate Code section 910 provides that attorneys for executors and administrators of a decedent's estate shall be allowed fees from the estate for conducting the ordinary probate proceedings and "such further amount as the court may deem just and reasonable for extraordinary services." (See also, Prob.Code, § 469 [attorney fees for extraordinary services to special administrator]; all further statutory references are to the Probate Code unless otherwise indicated.) The issue presented in this case is whether the fees so allowed include compensation for time reasonably spent to establish and defend the attorney's own fee claim, or what is sometimes referred to as "fees on fees" or "fees for fees." We conclude that section 910 authorizes courts in probate proceedings to award such compensation and that a contrary rule would ultimately be deleterious to decedents' estates and heirs because attorneys would be reluctant to perform services necessary to the proper administration of decedents' estates if the compensation awarded for their services could be effectively diluted or dissipated by the expense of defending against unjustified objections to their fee claims.

I

Marcia D'Esopo and Sonia Meyerhof were appointed co-administrators of the estate of their elder sister, Esther Royce Trynin, who died intestate in February 1981. The co-administrators, sole heirs of the decedent, retained the law firm of Pachter, Gold and Schaffer (hereafter Pachter) as probate counsel. The estate's value in August 1981, as stated in an inventory submitted at that time, was $409,000.

Pachter defended the co-administrators in a separate civil action (hereafter the Hook litigation) brought against them by Trevor Hook, after rejection of his creditor's claim against the estate, seeking recovery of $738,000 or half of the estate. In July 1983, a jury returned a verdict awarding Hook $125,000 plus costs. The co-administrators appealed from the judgment entered on this verdict and, in September 1983, retained Richard W. Eckardt to represent them on the appeal. Pachter continued to serve as probate counsel.

In May 1985, the judgment in favor of Hook was reversed by the Court of Appeal on the ground of jury misconduct. In June 1985, the court in the probate case awarded fees to Eckardt for extraordinary services performed to date. In October 1985, Eckardt's motion to be relieved as attorney of record in the Hook litigation was granted on the basis of the co-administrators' noncooperation and nonpayment of fees.

In January 1986, the co-administrators reengaged Eckardt to represent them in the retrial of the Hook litigation. Eckardt succeeded in settling the Hook litigation on the eve of retrial for $125,000, with the parties bearing their own respective costs. In March 1986, both Eckardt and Pachter petitioned for costs and fees for extraordinary services in defending the Hook litigation. Their petitions were consolidated for hearing. In April 1986, Pachter substituted out as probate counsel. As a result of appreciation in estate assets and the accumulation of rental income, the value of the estate at this time was approximately $593,000.

The co-administrators responded to the fee claims of Eckardt and Pachter by hiring an attorney to contest the claims. The co-administrators made no settlement offer to either petitioner; rather, they took the position that no further amount was owing and, indeed, that petitioners had been overpaid. Hearing on the consolidated claims for costs and fees required seven half-day sessions over a ten-week period and resulted in an order awarding Pachter $49,981 for its services and Eckardt an additional $5,364 for services performed subsequent to the previous award.

In May 1987, both Eckardt and Pachter filed additional petitions for allowance of fees for extraordinary services. These petitions sought compensation for time spent by Eckardt and Pachter in establishing and defending their previous fee claims. The court declined to receive or consider any evidence concerning these claims and denied them on the ground it lacked authority "to award compensation for services which benefit only the attorneys for the estate and do not enhance the size of the estate available for distribution to the beneficiaries thereof...." Both petitioners appealed from the orders denying their respective petitions. ¹

The Court of Appeal affirmed, agreeing with the trial court that section 910 does not authorize compensation for an attorney's time reasonably spent to establish and defend a fee claim.

II

Before addressing the specific question of attorney fees for fee-related services under section 910, it will be helpful to review general principles of state law governing compensation for attorney services in probate matters.

The rules governing compensation for attorney services for decedents' estates "do not arise from contract but are founded upon statutory enactment." (Estate of Johnston (1956) 47 Cal.2d 265, 272, 303 P.2d 1.) The pertinent statutory provisions govern both the amount recoverable and the procedure for recovery.

An attorney who has rendered services to an estate's representative may obtain compensation by petitioning the superior court sitting in probate for an order requiring the representative to make payment to the attorney out of the estate. (§ 911.) Because an attorney who has performed probate work is a person interested in the estate, the fee petition need not be presented by the representative but may be presented directly by the attorney, who may also appeal from an adverse ruling. (Estate of Merrill (1946) 29 Cal.2d 520, 523, 175 P.2d 819; Chapman v. Pitcher (1929) 207 Cal. 63, 68, 276 P. 1008; Estate of Lagersen (1962) 210 Cal.App.2d 788, 791, 26 Cal.Rptr. 783.) The probate petition is frequently the only remedy for enforcing the attorney's right to recover fees for probate work; with few exceptions (see, e.g., § 13660), the estate's representative is not personally liable for the fees (Estate of Kelleher (1928) 205 Cal. 757, 763, 272 P. 1060; Estate of Lee (1981) 124 Cal.App.3d 687, 693, 177 Cal.Rptr. 229; Hatch v. Bush (1963) 215 Cal.App.2d 692, 703, 30 Cal.Rptr. 397), and so the attorney is generally precluded from maintaining a separate action against the representative to recover compensation for work performed for the estate (Chapman v. Pitcher, supra, 207 Cal. at p. 69, 276 P. 1008; Hatch v. Bush, supra, 215 Cal.App.2d at p. 705, 30 Cal.Rptr. 397).

For conducting "the ordinary probate proceedings," an attorney is compensated in the same amount allowed as a commission to the estate representative (§ 910), which is determined as a percentage of the estate's value (§ 901). Fees for extraordinary services, on the other hand, are not determined by a fixed formula but instead require the exercise of judicial discretion to determine what amount is "just and reasonable" (§ 910). (Estate of Fraysher (1956) 47 Cal.2d 131, 136, 301 P.2d 848; Estate of Turino (1970) 8 Cal.App.3d 642, 648-649, 87 Cal.Rptr. 581.) Because the attorney's right to compensation is founded upon statute, the court, in determining the amount due an attorney for extraordinary services to an estate, is not bound by the terms of compensation specified in a contract of employment between the attorney and the estate's representative, such compensation provisions being generally unenforceable. (Chapman v. Pitcher, supra, 207 Cal. 63, 69, 276 P. 1008; Hatch v. Bush, supra, 215 Cal.App.2d 692, 705, 30 Cal.Rptr. 397.)

As this court has stated, "Every [probate] attorney should be fully and fairly paid for his [or her] services, having in mind their nature, their difficulty, the value of the estate, and the responsibility thus cast upon the counselor." (Estate of Byrne (1898) 122 Cal. 260, 266, 54 P. 957.) Other factors which may be considered by the court in determining compensation for extraordinary services include the nature of the estate assets and the amount awarded as ordinary compensation. (Estate of Walker (1963) 221 Cal.App.2d 792, 795, 34 Cal.Rptr. 832.) If, under all the relevant circumstances, the amount awarded as ordinary compensation is fair and reasonable for all the attorney services, the court may disallow a request for extraordinary compensation even though some extraordinary services have been performed. (Ibid.; see also, Estate of Fulton (1937) 23 Cal.App.2d 563, 567, 73 P.2d 664.)

Although benefit to the estate is one of the factors to be weighed by the court in fixing compensation (Estate of Stokley (1980) 108 Cal.App.3d 461, 473, 166 Cal.Rptr. 587; Estate of Briggs (1964) 230 Cal.App.2d 592, 595, 41 Cal.Rptr. 237), an attorney may be entitled to compensation even though the extraordinary services rendered "turn out to be entirely valueless" (Estate of Merritt (1950) 98 Cal.App.2d 70, 76, 219 P.2d 40; see also, Estate of Turino, supra, 8 Cal.App.3d 642, 648-649, 87 Cal.Rptr. 581). Services that do not directly benefit the estate in the sense of increasing, protecting, or preserving it are nonetheless compensable if the estate's attorneys or...