In re Butler's Estate

• Decision Date: 19 June 1940
• Docket Number: 27833.
• Parties: In re BUTLER'S ESTATE.
• Court: Ohio Supreme Court

28 N.E.2d 186

137 Ohio St. 96

In re BUTLER'S ESTATE.

No. 27833.

Supreme Court of Ohio

June 19, 1940

Certified by Court of Appeals, Franklin County.

Syllabus by the Court.

1. Where no exceptions have been filed in the Probate Court to a schedule of debts against a decedent's estate as permitted by Section 10509-119, General Code, and although the schedule of debts as filed has been approved by the Probate Court and claims listed therein paid by the administrator, the validity of such claims may still be challenged by exceptions of a legatee to the account of the administrator which shows that the latter has allowed and paid such claims.

2. An administrator is not exonerated from liability to his decedent's estate by reason of the fact that he had followed the advice of counsel, without other authorization in the allowance and payment of an invalid claim against the estate.

3. When the validity of a credit taken by an administrator in his account is challenged by exceptions, duly filed, the burden of establishing the validity of such credit is upon him.

4. In the absence of negligence in failing to collect assets of the estate, the administrator may be surcharged only with moneys belonging to the estate which were wrongfully paid out by him.

5. Defenses are not barred by the statute of limitations, and cross-demands must be deemed compensated as soon as they mature, insofar as they are equal to each other.

6. A written contract, whereby one party agrees to pay another for services theretofore rendered and for services to be thereafter rendered by the latter, which does not specify the price or amount of compensation for such services, is not void for uncertainty but is valid to secure the party rendering such services a reasonable compensation therefor covering any period prior to and 15 years after the execution of such contract.

7. A writing, executed by one party which acknowledges the existence of an indebtedness to another for services theretofore rendered by the latter, is sufficient to remove the bar of the statute of limitations against such indebtedness even though the amount of such indebtedness is not named or specified therein, provided there is no uncertainty as to the debt referred to in the acknowledgment.

8. A creditor of a deceased person whose claim has been paid by the executor or administrator is a competent witness in behalf of such representative to establish such claim in order that the representative may be allowed credit therefor in his account.

This case had its origin in the Probate Court of Franklin county on exceptions filed by the devisees and legatees under the will of Henry V. Butler, deceased, to the first account of the administrator with the will annexed of said estate.

Henry V. Butler died testate in Columbus, Ohio, on February 29 1936, at the age of 81 years, never having been married. Grover C. Brown had been attorney for Butler for many years and drafted his will in which Edward Butler, brother of decedent, was named executor. Mr. Butler for many years prior to his death had been a customer of Frederick W. Freeman, a stockbroker of Columbus.

A few days after Butler's death, Brown and Frederick W. Freeman went to the rooms which Butler had occupied as his living quarters prior to his death, took possession of all his papers and later took them to the office of Brown, there being no near relatives of Butler residing in Columbus excepting his brother, Edward Butler. Edward Butler, owing to advanced age and infirmities, declined to qualify as executor of the will and signed a declination recommending Frederick W. Freeman for appointment as administrator with the will annexed. Because of the fact that Frederick W. Freeman had a claim against the estate, he declined the appointment and his brother, Lewis C. Freeman, was appointed as such administrator with the will annexed. Lewis C. Freeman gave bond, qualified as administrator and selected Brown as his attorney, which selection was confirmed by action of the Probate Court.

The estate of Henry V. Butler, as disclosed by the inventory, approximated $320,000. On July 29, 1936, the administrator filed a schedule of debts which included an allowed claim of Grover C. Brown for legal services to Butler in his lifetime in the sum of $66,027, and an allowed claim of Frederick W. Freeman, the broker, in the sum of $21,407.99.

The account of Grover C. Brown filed with the administrator in substance claimed that from January 1, 1912, to and including February 28, 1936, he rendered forms of service, legal and otherwise, to the decedent, requiring approximately one-half of his time; that on several occasions Butler made trips to Cuba, Central America and Europe, during which time Brown managed and looked after all Butler's property and business; that he represented Butler as an attorney at law in all matters where legal services were necessary, and made trips to various places under Butler's direction; that during the entire time he placed at the disposal of Butler his automobile and drove decedent about on trips approximating 15,000 miles a year; that decedent spent many of his week ends and holidays at the home of Brown; that decedent occupied the office of Brown during much of the time, using his telephone and calling Brown at his office and home almost daily for some matters of business; that Brown platted and managed the sale of the land of the decedent, made all contracts, closed deals and took care of all legal matters in connection with the management of allotments in which the decedent was interested; that decedent agreed to pay Brown for these services at a later date, or to compensate him therefor by the provisions of a will whereby Brown would receive 50 per cent of Butler's estate; and that in 1928 an agreement in writing was entered into between Brown and Butler, a portion of which writing, signed by the latter, was as follows:

'I hereby agree to pay Grover C. Brown a reasonable fee for the services now rendered and to be rendered, and if anything should happen to me I want him to be well paid for all his services legal and otherwise.

'Dated February 8, 1928.'

Brown alleged in his proof of claim that these services were reasonably worth $3,000 per year; that no part of his claim had been paid, but that he would accept as a complete settlement the sum of $100 per month with interest at 6 per cent, computed annually, if paid without delay or trouble. The evidence discloses that Brown did not keep any specific book account covering these charges.

The proof of claim of Frederick W. Freeman set out that for the past 20 years he had been engaged in the business of buying and selling securities with offices in the city of Columbus; that since September 12, 1916, Henry V. Butler, deceased, used the services and occupied the premises of Freeman in connection with the buying and selling of securities and handling all real estate up to and including February 28, 1936; that since 1916 Freeman had rendered valuable service to the decedent in buying and selling securities, in handling financial matters in connection with the sale of real estate, in the collection of accounts, and in closing deals in relation to real estate; that decedent occupied the office of Freeman much of the time, used his telephones, safes, his bookkeepers and stenographers, his clerks and experts as his own advisers and assistants; that the reasonable value of services so rendered to decedent was $175 per month, making a total of $40,775; and that there was a credit on this account in the sum of $19,367.01, which credit, by evidence subsequently shown, arose from the sale of certain securities which were in Freeman's hands at the time of the death of the decedent, leaving a balance due the claimant, Frederick W. Freeman, of $21,407.99.

Upon the filing of the schedule of debts, a day was set for hearing and the Probate Court caused publication of notice of hearing to be made. No exceptions having been filed by the day of hearing, the schedule was approved by the probate judge on September 1, 1936. Shortly after the approval of the schedule of debts, the administrator paid to Grover C. Brown and Frederick W. Freeman the total amount of their respective claims.

During the months of April and May, 1937, certain legatees and devisees filed exceptions to the administrator's first account, and also moved for the removal of Lewis C. Freeman as administrator and Grover C. Brown as attorney, on the ground that the administrator unlawfully and fraudulently conspired with Brown and Freeman in presentation, allowance and payment of the respective claims of Brown and Freeman.

On April 26, 1937, the Probate Court appointed Lyle M. Sandles as special master commissioner to hear the testimony and make up the record on these exceptions. Before the completion of the hearing before the master, Lewis C. Freeman, on September 23, 1937, resigned. J. Paul McNamara was then appointed administrator de bonis non with the will annexed of the estate. The hearing proceeded on the exceptions to the account of Lewis C. Freeman, as administrator.

In the hearing before the master, Grover C. Brown was offered as a witness on behalf of Lewis C. Freeman and he testified over the objection of the exceptors, his evidence comprising over 1,500 pages of the record in this case. Later the master determined under direction of the Probate Court that the testimony of Brown was incompetent because he was an adversary party in this proceeding affecting the decedent's estate and could testify only to matters occurring after the death of the decedent; and the master held that the subject-matter of Brown's testimony constituted privileged communications because he had been attorney for...