New York Probate and Estate Administration Lawyer Blog
A New York Probate Lawyer said that, this is a proceeding by the trustee and as executor of the estate of deceased and as trustee, of the “Second Share” Trust under Article NINTH of the Last Will and Testament of the deceased to settle their account as trustees of the “Second Share” trust under Article NINTH of the will. The account covers the period March 31, 1986 through December 31, 2008. The trustees also filed a supplemental account covering the period January 1, 2009 through September 30, 2010. This is the trustees’ first and final account. The summary statement shows principal charges to the accounting party of $25,950, 272.00. A guardian ad litem was appointed to represent the interests of the minor grandchildren of the deceased.
A New York Will Lawyer said that, the decedent, died on September 28, 1985, a resident of Nassau County, leaving a will dated September 13, 1984, which was admitted to probate by decree of this court dated November 12, 1985. In Article NINTH of her will, the decedent directed that her residuary estate be divided into two equal shares, and she directed that the second such share be held in trust for the primary benefit of her son, and his issue. Pursuant to the terms of the trust, during her son’s lifetime, the trustees had the discretion to pay the net income to any one or more of her son and his issue. The trustees also had the discretion to distribute to the same class of persons such amount from principal as they deemed “wise and proper to provide for comfort, support, maintenance, education or general welfare.” The will provides that the trust shall terminate upon her son’s death. In addition, the decedent will give the deceased son a limited testamentary power of appointment over the remainder of the trust which he may exercise in favor of any of his lawful issue or lawful issue of the decedent.
A Nassau Probate Lawyer said that, in Article FOURTEENTH of her will, the decedent named the parties as trustees of the trust for the deceased son and authorized each to name his or her successor. One party renounced his nomination to act as trustee. Letters of trusteeship issued to the other remaining two parties on November 12, 1985. On July 23, 1986, this court issued letters of successor trusteeship to the trustees to act as his successor and resigned effective upon appointment.
A Nassau Estate Administration Lawyer said that, the son died on December 5, 2008, leaving a will dated May 1, 2008, which was admitted to probate by decree of this court dated May 22, 2009. Letters testamentary issued to the trustee. In his will, the decedent son exercised his power of appointment and appointed all of the property of the trust to the Appointive Trust, created under an agreement dated January 30, 2007, between the deceased son, as grantor, and the former as trustee. By election dated December 30, 2002, the then acting trustees, with the consent of the decedent and his daughters, who constituted all of the permissible income beneficiaries, opted to convert the trust to a unit rust under EPTL 11-2.4, effective as of January 1, 2003. The guardian ad litem has submitted his report. He recommends approval of the account. In addition, the guardian ad litem states that he believes a fee of $90,000.00 for the trustees’ counsel is reasonable in view of the size of the trust, the length of the period accounted for, the standing of counsel and the issues and responsibilities involved.
Westchester County Probate Lawyers said the issue in this uncontested accounting proceeding is whether the attorneys’ fees, the fee of the guardian ad litem, commissions and the settlement of the account should be approved by the court.
Suffolk County Probate Lawyers said the court in deciding the case said that, with respect to the issue of attorneys’ fees, the court bears the ultimate responsibility for approving legal fees that are charged to an estate and has the discretion to determine what constitutes reasonable compensation for legal services rendered in the course of an estate. While there is no hard and fast rule to calculate reasonable compensation to an attorney in every case, the Surrogate is required to exercise his or her authority “with reason, proper discretion and not arbitrarily”.
In evaluating the cost of legal services, the court may consider a number of factors. These include: the time spent; the complexity of the questions involved; the nature of the services provided; the amount of litigation required; the amounts involved and the benefit resulting from the execution of such services; the lawyer’s experience and reputation; and the customary fee charged by the Bar for similar services. In discharging this duty to review fees, the court cannot apply a selected few factors which might be more favorable to one position or another but must strike a balance by considering all of the elements set forth in a 1924 case. Also, the legal fee must bear a reasonable relationship to the size of the estate. A sizeable estate permits adequate compensation, but nothing beyond that. Moreover, the size of the estate can operate as a limitation on the fees payable, without constituting an adverse reflection on the services provided.
The burden with respect to establishing the reasonable value of legal services performed rests on the attorney performing those services. Contemporaneous records of legal time spent on estate matters are important to the court in determining whether the amount of time spent was reasonable for the various tasks performed.
These factors apply equally to an attorney retained by a fiduciary or to a court-appointed guardian ad litem. Moreover, the nature of the role played by the guardian ad litem is an additional consideration in determining his or her fee.
With respect to disbursements, the tradition in Surrogate’s Court practice is that the attorney may not be reimbursed for expenses that the court normally considers to be part of overhead, such as photocopying, postage, telephone calls, and other items of the same nature. The attorney for the trustees has submitted an affidavit in support of her firm’s application for approval of a fee of $90,000.00 for services rendered in connection with the administration and settlement of the trust and the accounting proceeding, together with disbursements. According to counsel, during the accounting period, her firm was responsible for matters of trust administration, including: (i) preparing the federal and New York State annual fiduciary income tax returns and annual statements for the trust, as well as the trust’s quarterly estimated tax payments; (ii) verifying the cost basis of the trust assets where necessary; and (iii) petitioning the court for the appointment of a successor trustee.
According to counsel, the firm’s fiduciary accountants conducted an extensive review of records and transactions in order to prepare the account. In addition, attorneys at the firm reviewed the first draft of the accounting, which covers a period of over 32 years, and made revisions and additions to the draft. Attorneys at the firm also prepared the petition and related court papers, arranged for execution of the documents and filed them with the court. The services provided also included appearing at the return date of citation, communicating with the guardian ad litem, reviewing the guardian ad litem’s report and preparing the supplemental accounting for the period January 1, 2009 through and including September 30, 2010. According to counsel, attorneys at the firm expended in excess of 110 hours on this matter at hourly rates ranging from $435.00 per hour to $800.00 per hour and fiduciary accountants rendered more than 96 hours of time at hourly rates of $230.00 per hour and $255.00 per hour. The total time charges amount to $89,404.00. In addition, the following disbursements totaling $2,975.27 were incurred: (i) photocopying charges of $906.20; (ii) word processing charges of $106.10; (iii) professional service charges of $217.34; (iv) filing fees of $1,265.00; (v) search service charges of $337.00; (vi) express delivery and postage charges of $137.66; and (vii) telephone charges of $5.97. The court notes that most of the disbursements other than the filing fees would be disallowed as office overhead without further substantiation. Nevertheless, the time charges plus allowable disbursements exceed the $90,000.00 fee for which counsel seeks approval.
Accordingly, considering all of the factors used to determine the reasonableness of fees, the court approves a total fee, including disbursements, of $90,000.00 as fair and proper compensation for the services rendered.
The guardian ad litem has submitted an affidavit of legal services which shows that the guardian ad litem rendered 19.70 hours at the rates of $610.00 per hour and $625.00 per hour for a total of $12,311.00. The guardian ad litem reviewed the accounting, had conversations with counsel for the trustees and prepared his report. The services performed by the guardian ad litem were of the utmost quality given the length of the period covered by the account.
Accordingly, the court approves a fee of $12,311.00 for the guardian ad litem, which fee shall be paid within thirty (30) days of the date of the decree to be entered herein. Commissions are approved subject to audit. In all other respects, the account is approved as filed.
If you have issue regarding cost of legal services in a probate proceeding, you will need the legal advice of a Nassau Probate Attorney and/or Nassau Estate Litigation Attorney at Stephen Bilkisa and Associates. Call us for free legal advice.