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Court Decides Legal Fees for Estate Administration


The Facts:

A decedent was survived by his wife, an adult son who is the petitioner herein, and four adult grandchildren. A New York Probate Lawyer said the decedent’s wife is a person under disability and her interests are being represented by a guardian ad litem appointed for that purpose by the court. Although SCPA 1404 examinations were demanded by the respondents, the examinations were never conducted, the parties having promptly entered into settlement negotiations.

The propounded instrument bequeaths the entire estate to the decedent’s lifetime trust, which in turn leaves the entire estate to petitioner, to the exclusion of the surviving spouse and grandchildren. The parties have entered into a stipulation of settlement, subject to the court’s approval, which permits the will’s admission to probate, effectively guarantees the surviving spouse her elective share, and distributes the net estate after payment of debts, administration expenses, and the elective share, into two parts, one part to be distributed to the petitioner and the other to be divided equally among the grandchildren.

Following the probate proceeding, the court is satisfied that the proposed stipulation is in the best interests of all parties concerned and the stipulation is accordingly approved.

Now, the court must determine an appropriate fee for the guardian ad litem.

The Ruling:

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 the estate administration or estate litigation. Bronx Probate Lawyers said this remains true even in the event that the parties have consented to the requested fee. The Surrogate is obligated to limit the attorney’s fees to reasonable amounts regardless of any agreement made by the attorney with the interested party. The retainer agreement is merely some evidence of the reasonable value of legal services. 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 Moreover, when multiple attorneys are employed by the fiduciary of a decedent’s estate, the aggregate fee should approximate what one attorney would charge. Some overlap in services may necessarily occur, and should be a factor when considering the aggregate fee. There can be some exceptions or stretching of this rule, for example, where the separate counsel does separate work, where counsel are under time pressures, or where there are complex or exceptional circumstances.

The court, in evaluating the cost of legal services, may consider a number of factors, viz: the time spent; the complexity of the questions involved; the nature of the services provided; the amount and complexity 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.

The court, in discharging this duty to review fees, 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 as set forth. Also, Brooklyn Probate Lawyers said the legal fee must bear a reasonable relationship to the size of the estate and to the interest of the ward of the guardian ad litem. Moreover, it is well-settled that time spent is, in fact, the least important factor considered by a court in fixing reasonable compensation.

On another note, a guardian ad litem is entitled to a fee for his or her services rendered. The aforesaid factors apply equally to an attorney retained by a fiduciary or to the 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. Normally, the fee of a guardian ad litem is an administration expense of an estate and is paid from estate assets.

A sizeable estate permits adequate compensation, but nothing beyond that. A large estate does not, by itself, justify a large fee. 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. In the absence of contemporaneous time records, little weight is given to estimates of time after the services have been performed. This also applies to the fee of a guardian ad litem.

Here, the value of the decedent’s estate at death was approximately $506,000.00. Debts and administration expenses total approximately $44,400.00, leaving a net estate of approximately $461,600.00 against which to calculate the elective share. The stipulation of settlement provides that the spouse will receive the sum of $154,000.00, which is greater than her one-third elective share. In his affirmation of legal services, the guardian ad litem avers that he spent approximately 31 hours on the matter. His services included: interviewing the attesting witnesses to the will, one of whom was the attorney who drafted the instrument; visiting his ward; ascertaining the value of the estate and determining the value of his ward’s elective share; participating in settlement negotiations among counsel for the petitioner and the grandchildren as well as three court conferences; and preparing and filing his interim and final reports.

Henceforth, considering the foregoing, the fee of the guardian ad litem is $7,500.00, to be paid from the spouse’s elective share.

The loss of a loved one isn’t easy. Engaging and being involved in litigation is, all the more, harder. At Stephen Bilkis & Associates, we can help you. We can provide you with the legal expertise you need. Contact us now and have a free consultation with our Nassau County Estate Administration Attorneys or Nassau County Probate Attorneys.

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