Opinion
No. 32926/B.
2013-01-31
In the Matter of the Proceeding by RYTVOC, INC. and Warock Corporation for the Revocation of Letters of Administration De Bonis Non Issued to Nicholas Young in the Estate of Joseph Young, Deceased.
Eric W. Penzer, Esq., Farrell Fritz, Uniondale, NY, for petitioner. Rudolf J. Karvay, Esq., Berkman Henock Peterson Peddy & Fenchel, Garden City, NY, for administrator d.b.n.
Eric W. Penzer, Esq., Farrell Fritz, Uniondale, NY, for petitioner. Rudolf J. Karvay, Esq., Berkman Henock Peterson Peddy & Fenchel, Garden City, NY, for administrator d.b.n.
EDWARD W. McCARTY III, J.
In this miscellaneous proceeding, the respondent, Nicolas Al Young, the administrator de bonis non, moves to dismiss the petition by two alleged creditors for revocation of his letters pursuant to CPLR 3211(a)(2) and (3). For the reasons that follow, the motion is granted for lack of standing. At the same time, the court revokes the letters issued to the respondent pursuant to SCPA 719 and directs that letters of temporary administration issue to the public administrator, upon his duly qualifying.
The decedent, Joseph Young, died on April 21, 1939, intestate. The decedent was the writer of such classic songs such as “I'm Gonna Sit Right Down and Write Myself a Letter,” “Dinah” and “I'm Sitting on Top of the World.” He was survived by his wife, Ruth Young, and his father, Samuel Young. Pursuant to the law of intestacy applicable at the time of the decedent's death, Ruth and Samuel were the decedent's only distributees. On May 9, 1939, Ruth was appointed administrator of the decedent's estate. Ruth died on November 8, 1973, a resident of New York County. Ruth left a last will and testament dated August 9, 1972, which nominated Lee V. Eastman and Florence Brooks Kressin as her executors. Florence died on January 27, 1983 leaving a will dated August 14, 1981. Letters testamentary in Florence's estate issued to Lee V. Eastman and Murray Silver on February 24, 1984.
The respondent, Nicholas Al Young, who alleges that he is a grandnephew of the decedent, petitioned for letters of administration de bonis non with respect to the decedent's estate by petition dated September 21, 2009. The petition filed by Nicholas in the administration proceeding recites that the decedent had eight brothers and sisters who were deceased and that five nephews/nieces and seventeen great-nephews/great-nieces “were surviving.” Nicholas' petition for letters of administration de bonis non was supported by waivers and consents of twenty-one of the distributees identified and citation issued to one alleged distributee, Steven Schubert, who did not appear on the return date. According to Nicholas' petition, the value of the assets in need of administration was $9,000.00.
By petition dated July 2, 2012, Rytvoc Inc. (hereinafter “Rytvoc”) and Warock Corporation (hereinafter “Warock”) commenced a proceeding for revocation of the letters issued to Nicholas. Rytvoc and Warock are the alleged owners of copyrights in various musical compositions owned by the decedent. Rytvoc and Warock claim that, by virtue of the authority granted to him as administrator de bonis non of the decedent's estate, Nicholas has proceeded to wrongfully interfere with the petitioners' ownership of the copyrights in various musical compositions by the decedent. Rytvoc and Warock further claim that Nicholas had no basis to have received letters of administration de bonis non and that the court would not have issued Nicholas letters but for a materially false allegation contained in his petition. According to Rytvoc and Warock, Nicholas' petition included an allegation that the decedent was not survived by a spouse or a parent when, in fact, the decedent was survived by both his wife Ruth and his father Samuel. They further assert that the siblings identified by Nicholas were not distributees of the decedent by reason of Ruth and Samuel surviving the decedent. Accordingly, Rytvoc and Warock claim that Nicholas has no right to serve as administrator, that letters issued to him on the basis of his “materially false” petition and that his letters should be revoked.
Nicholas has now moved to dismiss Rytvoc and Warock's petition for lack of standing. Nicholas argues that the petitioners do not qualify as parties who may petition the court for revocation of letters pursuant to SCPA 711. Nicholas asserts that neither Rytvoc or Warock fall into the categories identified in SCPA 711 as having standing to commence a revocation proceeding, namely “a co-fiduciary, creditor, person interested, any person on behalf of an infant or any surety on a bond of a fiduciary.” According to Nicholas, petitioners' only connection to the decedent's estate is that of adverse parties in possible future litigation over the ownership of copyrights that Nicholas “has sought to terminate ... pursuant to federal law, in order to benefit the estate.”
Rytvoc and Warock oppose the motion on two grounds. First, they argue that they became creditors of the estate having filed a Notice of Claim dated October 31, 2012 against the estate. The claim, which was filed after the instant motion was made and after the standing argument was raised by Nicholas, is for the following:
“There is due and owing to RYTVOC, INC. and WAROCK CORPORATION (“Claimants”) damages caused by the wrongful conduct of Nicholas Al Young (“Nicholas”), as administrator of the estate of Joseph Young (the “Estate”). Nicholas, on behalf of the estate, has interfered with Claimant's intellectual property rights forcing them to expend resources and engage in efforts to ensure that their proprietary rights and the benefits associated therewith are preserved. Claimants' damages include the legal fees and costs incurred, and to be incurred, in connection with Claimants' protection of their rights, currently in the amount of $16,663.48.”
Second, Rytvoc and Warock argue that, even if they do not have standing, the court may entertain a revocation proceeding under SCPA 719 whenever any ground for revocation of letters is brought to the court's attention. Rytvoc and Warock argue that the court having now been made aware of Nicholas' materially false petition should revoke his letters under SCPA 719.
Rytvoc and Warock not only assert that Nicholas misrepresented his status as a distributee, but further argue that it is unclear why Nicholas even sought letters in the first place. The petition refers to unadministered property passing by intestacy with a gross value of less than $9,000 without any further information. Petitioners argue that only Ruth Young's estate and/or Samuel Young's estate would have a beneficial interest in any personal property remaining in the decedent's estate after 70 years. In addition, despite Nicholas' position, Rytvoc and Warock assert that they own the copyrights, and that pursuant to contracts, the decedent's royalties were payable to the decedent, then to Ruth Young, then to Florence Brooks Kressin and then to the charitable beneficiaries of Florence Brooks Kressin's estate. The petitioners argue that, as the grantor of all renewal rights, Ruth Young was the only person who could exercise a right of termination under 17 U.S.C. § 394 and that they are being harmed by Nicholas' “wrongful interference” with their proprietary rights.
Nicholas' counsel has submitted a reply affirmation in support of the motion in which he disputes petitioners' status as creditors. He argues that since there has been no determination regarding the proper ownership of the intellectual property rights at issue, petitioners' “purported claim for damages, legal fees and costs is, at best premature.”
Standing
SCPA 711 provides that “a co-fiduciary, creditor, person interested, any person on behalf of an infant or any surety on a bond of a fiduciary” may petition for the suspension, modification or revocation of letters. SCPA 719 provides that the court, without a petition or the issuance of process may suspend, modify or revoke letters issued to a fiduciary “where any of the facts provided in 711 are brought to the attention of the court” (SCPA 719[10] ). SCPA 103(11) defines a creditor as “[a]ny person having a claim against a decedent or an estate.”
In order to be entitled to make the instant application for revocation of letters, the petitioners must have had standing at the time the petition was filed (2–33 Warren's Heaton Surrogate's Court Prac § 33:10 [7th ed] ). Here, the petitioners filed their petition on July 2, 2012, and the Notice of Claim is dated October 31, 2012. Since petitioners lacked standing at the time the petition was filed, it is not necessary for the court to pass upon the merits of the purported claim at this point or to address whether the claim was filed solely for the purpose of obtaining standing. The motion to dismiss the petition of Rytvoc and Warock is, therefore, granted on the basis of lack of standing.
SCPA 719
Nevertheless, pursuant to SCPA 719, the court may on its own revoke, suspend or modify letters where any of the facts provided in SCPA 711 are brought to the attention of the court. SCPA 711(4) provides for the revocation of a fiduciary's letters where “the grant of his letters was obtained by a false suggestion of a material fact.” A fiduciary who misstates a material fact in his petition for letters is subject to removal regardless of whether the material misrepresentation was made in good or bad faith ( see Matter of Lewis, NYLJ, Dec 5, 2007, at 36, col 2 [Sur Ct, Bronx County]; Matter of Barasch, 32 Misc.2d 548, 222 N.Y.S.2d 722 [Sur Ct, Nassau County 1962] ).
In Matter of Barasch (32 Misc.2d 548, 222 N.Y.S.2d 722 [Sur Ct, Nassau County 1962] ), the issue before this court was whether letters of administration should be revoked because of an alleged false statement in the petition to the effect that the decedent left no surviving spouse when the petitioner in the removal proceeding claimed to be the surviving spouse. This court stated that “[i]t is, however, well settled that a false statement in a petition for letters as to kinship is nevertheless false although honestly made.... Consequently, the only issue before the court is whether, in fact, the petitioner is the surviving spouse of the decedent” (Matter of Barasch, 32 Misc.2d 548, 549, 222 N.Y.S.2d 722 [Sur Ct, Nassau County 1962] [internal citations omitted] ).
Similarly, in Matter of Lewis (N.Y.LJ, Dec 5, 2007, at 36, col 2 [Sur Ct, Bronx County] ), the decedent's son received letters of administration based upon his petition which failed to identify his sister as a distributee and identified himself as the sole distributee. The daughter petitioned for the revocation of her brother's letters. The brother claimed that the failure was an inadvertent mistake. Surrogate Holzman stated as follows:
“Many cases broadly state that an inaccurate statement as to kinship in a petition for letters mandates the revocation of a fiduciary's letters on the ground that the letters were obtained by a false statement of material fact, and this result is required notwithstanding that the inaccurate statement was made in good faith and without any intent to commit a fraud” (Matter of Barasch, 32 Misc.2d 548, 549 [1962] citing Kerr v. Kerr, 41 N.Y. 272, 276;Matter of Rathyen, 115 App.Div. 644, 101 N.Y.S. 289;Matter of Gaffney, 41 Misc. 453; see also Matter of Beard, 135 A.D.2d 1122 [1987];Raysor v. Gabbey, 57 A.D.2d 437 [1977];Matter of D'Onofrio, 97 Misc.2d 250 [1978];Matter of Santiago, 5 Misc.3d 1014[A] [2004] ). ( Matter of Lewis, NYLJ, Dec 5, 2007, at 36, col 2 [Sur Ct, Bronx County 2007] ).
The court, therefore, revoked the brother's letters ( see also Matter of Rosado, 2007 N.Y. Lexis 8423 [Sur Ct, Bronx County 2007]; Matter of D'Onofrio, 97 Misc.2d 250, 411 N.Y.S.2d 152 [Sur Ct, Bronx County 1978] ). In Matter of D'Onofrio, 97 Misc.2d 250, 411 N.Y.S.2d 152 (Sur Ct, Bronx County 1978), Surrogate Gelfand pointed out that such a rule is necessary for the following reason:
“If a representation is shown to be false, the letters of the fiduciary may be revoked regardless of whether the misrepresentation was made innocently, or in good faith.... The reason for this rule is that in revoking letters of a fiduciary the court is carrying out its responsibility to have the proper person administer the estate. The thrust of a proceeding to revoke is not to punish the fiduciary as an individual, but to protect the estate” (internal citations omitted) (Matter of D'Onofrio, 97 Misc.2d 250, 252, 411 N.Y.S.2d 152 [Sur Ct, Bronx County 1978] ).
Thus, it is not necessary for the court to ascertain whether Nicholas made the error in bad faith. The court notes, however, that it appears from the court file that Nicholas did not attempt to deceive the court as to the fact that Ruth Young survived the decedent. Nicholas provided the court with numerous documents evidencing Ruth's date of death.
In order to determine whether Nicholas is the proper person to administer this estate, a review of the statutory framework setting forth the priority for letters is necessary. A proceeding to obtain letters of administration de bonis non is the same as upon an application for original letters of administration (2–10 New York Civil Practice: SCPA 1007.02). SCPA 1007, governing the issuance of letters of administration de bonis non, provides that “[w]hen the office of administrator becomes vacant for any reason the court may grant letters of administration de bonis non to one or more eligible persons and the proceedings to procure such letters shall be the same as upon application for original letters of administration.”
SCPA 1001, which governs the application for original letters of administration, requires that letters be issued to persons who are distributees of an intestate decedent, and who are eligible and qualify, in a specified order. When all of the decedent's distributees are deceased, letters of administration may issue to their fiduciaries, with preference given to the fiduciary of the distributee entitled to the largest share in the estate, or if all such deceased distributees are entitled to share equally in the estate, then to one or more of such distributees' fiduciaries (SCPA 1001[3] ). Alternatively, the court may issue letters of administration to any eligible “person who is not a distributee upon the acknowledged and filed consents of all eligible distributees, or if there are no eligible distributees, then on the consent of all distributees ...” (SCPA 1001[6] ). Where letters are not granted as set forth above, they shall be granted in the following order to: (a) the public administrator, (b) the petitioner, in the court's discretion, or (c) to any other person or persons (SCPA 1001[8] ).
In Matter of Brown (153 Misc. 41, 274 N.Y.S. 496[Sur Ct, Kings County 1934] ), two persons competed for letters of administration de bonis non. One was a creditor who was also a grandniece and step-granddaughter of the decedent; the other was the mother of the deceased administrator, who had been the decedent's sole distributee. The court found that the deceased administrator had been the only person entitled to share in the decedent's estate at the time of her death. Accordingly, this right passed to his executrix, and letters of administration de bonis non issued to the deceased administrator's executrix.
Similarly, in Matter of Gallagher (194 Misc. 180, 86 N.Y.S.2d 589 [Sur Ct, Kings County 1949] ), the decedent died intestate, leaving his widow, two brothers and a sister as his only distributees. The widow was appointed administrator of his estate, but subsequently died. One of the decedent's brothers applied for letters of administration de bonis non with the consent of his brother and sister. The executors of the deceased widow requested the issuance of letters of administration de bonis non to one of them. The court found that the estate of the deceased widow was entitled in distribution to a much greater part of the decedent's net estate than his brothers and sister were. The widow had a prior right over decedent's brothers and sister to letters of administration, and the court awarded letters of administration to the executors of her estate. In Matter of Mraz, 111 Misc.2d 804, 445 N.Y.S.2d 405 (Sur Ct, Nassau County 1981), the court awarded letters of administration de bonis non to the decedent's son as opposed to the wife of the decedent's deceased son who had been appointed the administrator of the decedent's estate. The court held that the surviving son had a prior right to receive letters of administration (SCPA 1001[4][b] ).
The only distributees of the decedent's estate were Ruth Young and Samuel Young, both of whom are deceased. Pursuant to the statutory framework, the next persons in line to serve as fiduciary of the decedent's estate are the fiduciaries of Ruth's and Samuel's estates. Here, the petition failed to identify Ruth Young and Samuel Young as distributees or to cite the fiduciaries of their respective estates. As Surrogate Gelfand stated in Matter of D'Onofrio, 97 Misc.2d 250, 252, 411 N.Y.S.2d 152 (Sur Ct, Bronx County 1978), the court has an obligation to make sure that the proper person is administering the estate. It is unclear whether the proper person is administering this estate. Moreover, the petition lists the decedent's assets in need of administration as $9,000.00. The court is concerned that this figure is underestimated as it appears the decedent was a successful songwriter whose estate consisted of royalty interests which may be of a greater value than indicated given the possible copyright battle.
Based upon such concerns and due to the misstatement in Nicholas' petition, Nicholas' letters are revoked. Letters of temporary administration shall issue to the Public Administrator, upon his duly qualifying. The Public Administrator shall attempt to identify the fiduciaries of Ruth Young's estate and Samuel Young's estate who have a prior right to letters of administration de bonis non and to ascertain the value of the assets in need of administration. The matter is scheduled for a conference on March 6, 2013 at 9:30 a.m. at which time the Public Administrator shall report his findings to the court and to Nicholas' counsel.
Proceed accordingly.
This constitutes the decision and order of the court.