Young's Estate, In re

• Decision Date: 12 March 1975
• Citation: 80 Misc.2d 937,365 N.Y.S.2d 695
• Parties: In re ESTATE of Agnes B. YOUNG, Deceased. Surrogate's Court, New York County
• Court: New York Surrogate Court

Page 695

365 N.Y.S.2d 695

80 Misc.2d 937

In re ESTATE of Agnes B. YOUNG, Deceased.

Surrogate's Court, New York County.

March 12, 1975.

Wormser, Kiely, Alessandroni & McCann, New York City (Richard G. Hewitt and David P. Callahan, New York City, of counsel), for petitioners.

Selig J. Levitan, New York City, for respondent.

MILLARD L. MIDONICK, Surrogate.

This is a proceeding instituted by the executors of the estate pursuant to SCPA 2103 to discover property. Simon & Schuster, Inc. and the decedent were parties to certain publishing agreements which provided for royalties to be paid to the decedent. The executors allege that there is $57,824.08 in royalty earnings owed to the decedent's estate in the possession of the respondent and they seek delivery of this amount. The respondent concedes that on September 30, 1974 there was credited to the decedent the sum of $53,452.58 in unpaid royalties. The respondent claims that according to the contractual agreement with the decedent it is not required to pay to the decedent any more than $3,000 during any one calendar year. Moreover, as an affirmative defense the respondent alleges that this court lacks jurisdiction to grant petitioner's application, since this is a proceeding to collect a common debt or contract obligation.

In Matter of Trevor, 309 N.Y. 389, 131 N.E.2d 561 it was held that the Surrogate was without jurisdiction to entertain a discovery proceeding in order to direct a bank to deliver to an estate the proceeds of a bank account. The Court of Appeals held (309 N.Y. at 392, 131 N.E.2d at 562): 'While the statute (SCA § 205 presently SCPA § 2103) speaks in broad and unqualified terms of 'money or other personal property, or the proceeds or value thereof,' the decisions interpreting that language disclose that it was not the intention of the Legislature that all estate claims were to be adjusted by way of a discovery proceeding. The purpose of such proceeding in the Surrogate's Court is to obtain the possession of Specific personal property or money which belongs to the estate, or the value of the proceeds thereof in the event of the disposal * * *.'

After the decision in Matter of Trevor, the Legislature in amending SCA section 205, added to the jurisdiction of the Surrogate in discovery proceedings. Under the SCPA money or other personal property referred to in section 2103 includes money deposited and all property rights of the depositor consequent on the deposit of money by the decedent or for his account in a banking organization where the depositary claims no beneficial interest other than its proper costs, fees or expenses. For years the courts have been saying that a discovery proceeding may not be used to recover a debt owed to a decedent and that a discovery proceeding is not applicable to recover real property.

We have here a petition seeking to recover a specific fund allegedly set aside under the terms of a contract. The respondent urges that the recovery obtainable is limited by the royalty agreement of the parties and that the cause of action, sounding in contract, must be heard in the Supreme Court rather than in the Surrogate's Court.

The Tweed Commission labored long and hard to minimize this type of fragmentation and unnecessary shuttling from one court to another. (Temporary Commission on the Courts, 1956 Report, p. 1405, McKinney's Session Laws 1956). Some consolidation of jurisdiction was achieved in the form of the new Article 6 of the State Constitution effecting a substantial court reorganization. In the Eighth Annual Report of the Judicial Conference of the State of New York (1963), at page 9, it was noted that 'New York's first court reorganization in over a century was effected in 1962 by revisions of the State Constitution. By the New Article 6, which became part of the Constitution on January 1st, 1962 and operative on September 1st, 1962, a uniform court system was established * * *.'

Indications of the meaning of the new constitution in respect to avoiding fragmentation of jurisdiction appear in the broad mandatory provisions of section 12 of Article 6 where it is stated 'd. The surrogate's court shall have jurisdiction over all actions and proceedings relating to the affairs of decedents, probate of wills, administration of estates, and actions and proceedings arising thereunder or pertaining thereto, guardianship of the property of minors, and such other actions and proceedings, not within the exclusive jurisdiction of the supreme court, as may be provided by law.'

In 25 Carmody-Wait 2d, § 149:75, page 69, it is stated: 'The mandate of the New York State Constitution is clear and unequivocal: the Surrogate's Court shall have jurisdiction not only over 'all actions and proceedings relating to the affairs of decedents' but also over 'administration of estates and actions and proceedings arising thereunder or pertaining thereto.' Therefore, for the Surrogate's Court to decline jurisdiction, it should be abundantly clear that the matter in controversy in no way affects the affairs of a decedent or the administration of his estate.'

While the Supreme Court could take concurrent jurisdiction over the contract claim now before this court, in its discretion, if the petitioner had resorted to the court, it would be unthinkable and patently unconstitutional for the Legislature to forbid exercise of jurisdiction by the Surrogate's Court over such obviously surrogate's business as the probate of wills. And so it would be error, less obvious error but error nevertheless, for the Legislature to eliminate concurrent jurisdiction by the Surrogate's Court over contract claims by estates, since such claims are cases 'relating to the affairs of decedents'.

To minimize fragmentation of jurisdiction, section 19 of Article 6 of the Constitution provides for transfer, rather than dismissal, of actions and proceedings not cognizable in the transferring court. To this extent there is at least one court in the State of New York since September 1st, 1962. Thus, if the respondent in this proceeding were correct that jurisdiction over a contract claim by a decedent's estate does not lie in this court, its motion to dismiss is inappropriate, since section 19(d) of Article 6 of the Constitution provides: 'The surrogate's court shall transfer to the supreme court * * * any action or proceeding which has not been transferred to it * * * and over which the surrogate's court has no jurisdiction.'

The Supreme Court in New York County has held 'that the provisions of Article 6 § 19 of the Constitution are 'a self-executing grant of constitutional power * * * not dependent upon any legislative enactment for implementation' (Frankel Associates, Inc. v. Dun & Bradstreet, 45 Misc.2d 607, 610, 257 N.Y.S.2d 555, 558).' (Kemper v. Transamerica Ins. Co., 61 Misc.2d 7, 9, 304 N.Y.S.2d 515, 518). The Civil Court is in accord (Garfinkle v. Kaplan, 77 Misc.2d 1097, 355 N.Y.S.2d 974).

The ancient provisions in the Constitution of 1894, continued without change in the Constitution of 1938 until the vey day on which our present Constitution's Article 6 took effect, set forth merely the vague language: 'Surrogates and surrogates' courts shall have the jurisdiction, legal and equitable, and powers now established by law until otherwise provided by the legislature.' Surely the new constitutional language of September 1st, 1962 has some additional meaning in stating that the Surrogate's Court shall have jurisdiction over all actions and proceedings relating to the affairs of decedents. Nothing that the legislature can enact can detract from that language. Instead, the Legislature has expressly adopted the broad grant of constitutional power in SCPA 201 in stating that this court shall continue to be vested with all the jurisdiction conferred upon it by the Constitution, including all matters relating to the affairs of decedents.

The September 1st, 1962 Constitution has done away with the specific personal property limitations. Indeed, even title to real property claimed by a fiduciary now may be adjudicated, albeit collaterally under a claim for rents, by the Surrogate's Court (Matter of Hall, 54 Misc.2d 923, 283 N.Y.S.2d 540; Matter of Rungo, 74 Misc.2d 239, 342 N.Y.S.2d 929).

The Legislature, by copying and continuing ancient statutory language in respect to the discovery of 'any money or personal property' had neither the authority nor even the intention to contravene the new broad constitutional command of Article 6, section 12 of the Constitution. Thus SCPA 202 provides: 'The proceedings enumerated in this act shall not be deemed exclusive and the court is empowered in any proceeding, whether or not specifically provided for, to exercise any of the jurisdiction granted to it by this act or other provisions of law, notwithstanding that the jurisdiction sought to be exercised in the proceeding is or may be exercised in or incidental to a different proceeding.'

As the reviser intimates, any power of the Surrogate, whether exercisable in a discovery proceeding, reverse discovery proceeding, construction proceeding, accounting proceeding, or in 'an independent proceeding', can now be adjudicated in the matter before me (SCPA 202; Matter of Gebauer, 79 Misc.2d 715, 361 N.Y.S.2d 539). The forms of action were supposed to have been buried in 1848, but occasionally they are said to rule us from their graves. Discovery is a form of action which should not hobble the Surrogate's Court (Matter of Gebauer, supra; Matter of Ziehm,79 Misc.2d 467, 360 N.Y.S.2d 391).

Even before the 1962 Constitution, Chief Judge Cardozo, in more eloquent language than this court...