Hayward v. Plant

• Decision Date: 10 January 1923
• Citation: 98 Conn. 374,119 A. 341
• Court: Connecticut Supreme Court
• Parties: HAYWARD et al. v. PLANT et al.

119 A. 341

98 Conn. 374

HAYWARD et al. v. PLANT et al.

Supreme Court of Errors of Connecticut.

January 10, 1923

Appeal from Superior Court, New London County; Allyn L. Brown Judge.

Appeal by Mae Cadwell Hayward, executrix, and others from decree of court of probate, opposed by Henry B. Plant and others executors. From a judgment reversing the decree allowing the account of the defendants, executors, in so far as it allowed compensation for the executors in excess of sums named in the judgment and in all other respects confirming the decree of the court of probate, plaintiffs appeal. No error.

Morton F. Plant, the testator, died November 4, 1918, leaving a will giving to the defendants, executors, very broad powers as to the continuance of the several businesses he was interested in, and as to his investments therein. His estate inventoried over $33,000,000, and up to the day of the hearing in the superior court over $36,000,000 of funds of the estate had passed through the executors hands. The debts and charges of the estate were about $16,000,000, of which sum $7,000,000 were time loans secured by stock as collateral maturing subsequent to the death of the testator; the interest which accrued upon these loans after the testator's death was $173,425. Dividends paid upon the stock so held were credited by the executors in their account to income, and the interest on these time notes and on all bonds after the death of the testator was also credited to income, while interest which accrued prior to the testator's death was charged to principal. The testator authorized two or more of the executors and trustees of his will to act for all. At the first meeting of the executors it was voted: That the business of the estate for the present be conducted by Messrs. Sullivan, Shearer, and the United States Trust Company and upon their failure to agree on any matter it should be referred to all of the executors before action should be taken.

On February 5, 1919, all of the executors in pursuance of the power given in the will executed a written designation appointing Messrs. Sullivan and Shearer and the Trust Company, or either of the individuals with the trust company, to act for all. Thereafter by virtue of this vote and designation, Messrs. Sullivan and Shearer and the trust company attended to all the various business matters of the estate and were the more active executors. All of the executors met 11 times, and discussed the affairs of the estate, heard reports of what the active executors had done and approved of the same, and all important matters were referred to the whole body of executors for final approval. The trust company had most to do with the custody and the transferring, upon sales, of the securities; Mr. Shearer with the legal matters, and Mr. Sullivan with the keeping of the accounts. Mr. Shearer was a member of the firm of lawyers Stewart & Shearer, who were attorneys for the estate, but he did not share in any of the payments for the services of the firm to the estate, nor did the firm share in his compensation as executor. Mr. Sullivan was in the employ of the testator in his lifetime, and was familiar with the conditions of most of the properties. The parties agreed that the court should fix the compensation of the executors from their appointment to the date of trial, November 29, 1921, a period of about three years. Just, reasonable, and proper compensation to the executors was as follows: To Mr. Sullivan, $135,000; to Mr. Shearer, $120,000; to the United States Trust Company, $120,000; to Mrs. Hayward, $30,000; and to Mr. Plant, $30,000.

In determining the compensation of each executor the court weighed and considered all the facts bearing thereon and all the evidence relating thereto, including the opinions of the expert witnesses. It took into consideration the gross amount of the estate, $36,271, 814.82, which passed through the executors' hands, the time and effort expended by each executor, the difficulty and complexity of the problems dealt with, including the raising under most unusual financial conditions of between $16,000,000 and $17,000,000 to pay the debts, the broad powers and discretion granted the executors under the will, the manner of their exercise of the same, the results obtained, and all of the other circumstances and facts disclosed by the evidence. Of the five executors the widow and son were not particularly qualified to administer this large estate. Mr. Sheldon, the president of the trust company, and Mr. Shearer and Mr. Sullivan were so qualified, and for years had been the testator's trusted advisers or business associates, and were familiar with the testator's business matters and financial problems, and also with general financial and business conditions.

At the time when the will was executed and at the testator's death, many of his financial affairs were so involved that apparently only the intelligent exercise of such extremely broad powers as were given the executors under the will could have saved the estate from tremendous losses. The testator selected these three executors, counting on their collective skill, experience, and judgment to solve these problems with the large amounts involved. The executors in their accomplishment functioned in the manner the testator contemplated they would. The greater part of the cash of the estate the executors deposited in the name of the estate with the United States Trust Company of New York, which allowed interest on the average daily balances at a rate of interest at least as high as the prevailing rate paid by trust companies in New York upon deposits during that period. By the laws of the state of New York, the United States Trust Company was required to and did keep 15 per cent. of all its deposits as cash reserve. The Trust Company earned upon this account $1,832.66 for the entire period, after deducting the proportionate share of its expenses in carrying on its banking business which this account should bear. The average amount of daily balances to the credit of the estate in the account from November 22, 1918, to January 1, 1919, was $268,443; from January 1, 1919, to January 1, 1920, $1,525,366; from January 1, 1920, to January 1, 1921, $861,328; and from January 1, 1921, to January 18, 1921, $108.210.

Courts of probate, as to all matters within their jurisdiction, are clothed with chancery powers so far as may be necessary to enable them to do full justice between the parties.

Carlos S. Holcomb, of Hartford, and Frank E. Healy, Atty. Gen., for plaintiff appellant.

Walter C. Noyes, of New York City, and Hadlai A. Hull, of New London, for appellants Mae Cadwell Hayward and others.

Lucius F. Robinson, of Hartford, Charles B. Whittlesey, of New London, and W. A. W. Stewart, of New York City, for appellees, United States Trust Co. and others.

WHEELER, C.J.

The appellants seek to correct the finding: (1) By having four of the paragraphs of the draft-finding added. As we read the evidence none of these paragraphs except perhaps the 13th should have been added, and as its addition cannot affect the disposition of any of the questions raised by the record, it is immaterial whether it be in or out of the finding. (2) By striking out paragraphs 38, 39, 40, 41, and 42 of the finding, which recite the several awards made to the executors as " just, reasonable and proper compensation" for their services as executors. A conclusion of this character is an ultimate one, drawn from many subordinate facts which the trial court finds from the evidence. If the conclusion, upon review in this court, be found erroneous in law, it may be modified or set aside. It will be erroneous if it is found in violation of some rule or principle of the law, or is in conflict with the rules of logic and reason, or is contrary to, or inconsistent with, the subordinate facts. In Nolan v. New York, N.H. & H. R. Co., 70 Conn. 159, 39 A. 115, 43 L.R.A. 305, we speak of the review of an erroneous conclusion from subordinate facts as an error of law:

" It [this principle] is not only supported by the true ratio decidendi of a long line of decisions, but is imbedded in the very structure of our *** jurisprudence."

In Hyde v. Mendell, 75 Conn. 143, 52 A. 745, Mr. Justice Hamersley, whose opinions have done much to elucidate this difficult question, wrote:

" The error assigned, in effect, is that the trial court has erred in basing its ultimate conclusions as to the facts of negligence upon the specific facts set forth. Such a conclusion is reviewable when it appears that the trial court in drawing its inferences of fact from conceded, subordinate or evidential facts, has violated the plain rules of reason, or when some one or more of the facts found are legally inconsistent with the conclusions reached." Bell v. Strong, 96 Conn. 12, 112 A. 645; Jordan v. Apter, 93 Conn. 303, 305, 105 A. 620; Seward v. Seward & Son Co., 91 Conn. 193, 99 A. 887; Meech v. Malcolm, 88 Conn. 726, 92 A. 657; Lawler v. Hartford Street Ry. Co., 72 Conn. 80, 81, 43 A. 545; New Haven Rendering Co. v. Connecticut Co., 89 Conn. 252, 253, 93 A. 528.

The conclusion arrived at by the trial court of a just and reasonable compensation for the several executors was not made in violation of any rule or principle of law, nor of the rules of logic or reason, nor is it contrary to or inconsistent with the subordinate facts, so far as they appear in the finding or the memorandum of decision made a part of it. The subordinate facts from which this conclusion must have been drawn are obviously only party stated in the finding. We have no right to add to these subordinate facts from the evidence. We must take the finding as it is. If there is nothing in it which shows that this...