Opinion
118/432.
05-15-1941
MALONEY v. KINKEAD et al.
James A. McTague, Jr., of Jersey City (Ralph E. Lum, of Newark, of counsel), for complainant. Milton McNulty & Augelli, of Jersey City, for defendant Eugene F. Kinkead and another. Burke, Sheridan & Hourigan, of Union City, for defendant Lauretta M. Gildea and another.
Suit for accounting by Helen C. Maloney, administratrix of the Estate of Edwin J. Maloney, against Eugene F. Kinkead and Lauretta M. Gildea, administrators of the estates of Thomas J. Maloney and Mary C. Maloney, and another. On exceptions to the accounts of defendant administrators.
Decision in accordance with opinion.
Affirmed in 24 A.2d 833.
James A. McTague, Jr., of Jersey City (Ralph E. Lum, of Newark, of counsel), for complainant.
Milton McNulty & Augelli, of Jersey City, for defendant Eugene F. Kinkead and another.
Burke, Sheridan & Hourigan, of Union City, for defendant Lauretta M. Gildea and another.
KAYS, Vice Chancellor.
This matter comes before me on certain exceptions filed by complainant to the accounts of the administrators of the estate of Thomas J. Maloney, deceased, and Mary C. Maloney, deceased. The accounts which the administrators were required by this court to make cover a period from June 12, 1934, to the time of the filing of the bill of complaint.
The first exceptions relate to Account No. 4 of the estate of Thomas J. Maloney.
Exception No. 1 to Account No. 4 is to an item of $14,542.40 which was paid to the estate of Mary C. Maloney, deceased, pursuant to the terms of an agreement between the exceptant's decedent and the Maloney heirs and next of kin. This court held in its opinion dated August 14, 1940, that the exceptant is estopped from disputing items covered by the consent and release signed by Edwin J. Maloney on June 15, 1934. This item comes within that ruling and, therefore, is overruled.
Exception No. 2 to Account No. 4 is to payments of fees totaling $2,700 paidto the accounting firm of Boyce, Hughes and Farrell on the ground that the same is excessive and improper. On the main case a representative of said firm testified that it prepared the accounts for the administrators. Considering the magnitude of the estate the administrators were justified in seeking expert assistance in the preparation of their accounts. See Hagedorn v. Arens, 106 N.J.Eq. 377, 150 A. 4. Since this item is questioned by the exceptants, defendants may produce evidence of the reasonableness of the charge.
Exception No. 3 to Account No. 4 is to a payment of $300 to McPike & Zimmer, a firm of accountants, for services rendered in preparing the 1932 income tax return. The exceptant claims that this item was included in a charge by the same firm for which they previously had been paid. An examination of the proof of this claim (Exhibit C-11) reveals that the services rendered in the previous claim covered a period from 1924 to 1931 and the claim in question covers a period for the 1932 income tax. The right of the administrators to employ the accountants is justified under the case of Hagedorn v. Arens, supra. Since exceptant claims the charge is excessive the administrators may offer evidence to prove the reasonableness of the same.
Exception No. 4 to Account No. 4 is to an item of $16,000 shown on "Schedule G". It is excepted to on the ground that it was not paid to Edwin J. Maloney. The item was transferred to the brokerage firm of Florentino & Co. for Edwin's account as appears by a cancelled check dated July 31, 1934. The testimony on the main case was that the said sum was credited to Edwin J. Maloney's account with the above firm in accordance with his instructions. The transaction was a part of a general plan in which he participated with the other heirs and next of kin and was made during the lifetime of Edwin and at his direction and with his consent. There is no fraud shown relative to the same. Therefore, this exceptant cannot now question the transaction and the exception is overruled.
Exceptions Nos. 5 and 6 of Account No. 4 are to a payment of $12,000 shown on "Schedule G" and of $980 shown on "Schedule H" both of which were made to Mr. and Mrs. Gildea. The objection is that these payments were improper and illegal. The payments were made pursuant to the agreement whereby Edwin assigned part of his interest in the estate to Mr. and Mrs. Gildea. I have already ruled that the assignment is valid and the exception is, therefore, overruled.
Exception No. 7 to Account No. 4 is to an allowance claimed on "Schedule H" of $760 paid to Edwin. The objection is that no such payment was made. The administrators produced two cancelled checks dated December 18 and 19, 1934, respectively, which total said amount. It appears by the endorsements on said checks that they were credited to Edwin's account with Florentino & Co. in accordance with his instructions. The exception is, therefore, overruled.
Exception No. 8 to Account No. 4 is to a payment of $2,285 made to Mrs. Gildea as shown on "Schedule H". The objection is that the payment was improper and illegal and that Mrs. Gildea was not entitled to the same. This exception includes the item of $980 set forth in exception No. 6 above. The balance of the item comes within the purview of exceptions Nos. 5 and 6 and is overruled.
Exception No. 9 to Account No. 4 is to all of the items of discharge shown in Account No. 4. The objection is that the administrators have failed to produce vouchers to justify the items. Proof may be made by other means than by vouchers. Smith v. Robinson, 83 N.J.Eq. 384, 90 A. 1063; Villa Site Co. v. Copeland, 91 N.J.Eq. 503, 111 A. 39, 13 A.L.R. 356. Prior to the death of Edwin J. Maloney it was agreed by all the heirs and next of kin that no formal accounting would be filed with the court by the administrators. The administrators furnished statements to the heirs and next of kin. After his death, however, the defendants are required to produce satisfactory evidence of payment. Most of the disbursements have been proved by proper vouchers. There are two items in "Schedule E" which require further proof. Voucher No. 226 for the sum of $2,700 is accompanied by a cancelled check for $3,000. Defendants may have the opportunity to explain this discrepancy. An unnumbered and unsigned voucher in the amount of $40.35 should be supported by a proper voucher. Items shown in "Schedule F" are supported by cancelled checks with the exception of one disbursement of $2.50. The administrators will be permitted to prove the payment of this item. "Schedules G and H" are supported by cancelled checks except the items above mentioned and theblanket exception is overruled with said exceptions.
Exception No. 1 of Accounts Nos. 5 and 6 is a blanket exception to all of the items of discharge amounting to $45,825.82 on the ground that they are not supported by vouchers. The administrators produced receipted bills or cancelled checks to cover these disbursements. The exception, therefore, is overruled.
Exception No. 1 to Account No. 7 is to the payment of $50,000 to the Roman Catholic Diocese of Newark in settlement of a claim against the estate upon which suit was begun. A cancelled check was produced to show payment. The exceptant claims that the matter should not have been compromised. There was testimony relative to this matter at the main hearing. Heirs and next of kin, representing eighty-four per cent. in interest (being all except the complainant), agreed to the settlement. The administrators acted in good faith and with due care and it is, therefore, not necessary to prove that the claim was a just one. See In re Schlosser, 119 N.J.Eq. 201, 181 A. 640, affirmed 119 N.J.Eq. 488, 182 A. 636. The exception is, therefore, overruled.
Exception No. 2 to Account No. 7 is to a claim for an allowance of $23,145, consisting of cash and securities, which appear from the account to have been actually distributed to the exceptant. It appears that this amount was not actually paid to the exceptant but tendered to her conditioned upon the execution and delivery of a release and refunding bond. A form of bond was tendered which was not accepted by the exceptant and the bond tendered by the exceptant was not accepted by the administrators. The administrators express their willingness to turn over the cash and securities when a proper bond is executed and delivered. The administrators will be directed to turn over said cash and securities upon the execution and delivery of a proper bond.
Exception No. 3 to Account No. 7 is to a payment to Mr. and Mrs. Gildea of $69,858.75 shown on "Schedule E". This amount was paid pursuant to the assignment made by Edwin J. Maloney to the Gildeas. The exception is overruled for the reasons mentioned relative to exceptions Nos. 5 and 6 to Account No. 4.
Exception No. 4 to Account No. 7 is to the payment of $5,614.29 to the Mal Realty Company shown on "Schedule E". The objection is that said payment was improper because there was nothing due the said company. The Mal Realty Company was incorporated by the heirs and next of kin during the lifetime of Edwin J. Maloney for the purpose of taking over the New Jersey real estate of which Mr. and Mrs. Thomas J. Maloney died seized. The administrators turned over to the corporation the balance of cash in their hands by consent of all the parties in interest other than the exceptant. The exceptant is entitled to $898.29 of this fund which the administrators are ready to pay to her upon the execution and delivery of a proper refunding bond. From a technical standpoint the exception is proper as the amount due to her should not have been paid to the said corporation. The administrators, therefore, will be directed to make said payment of the above mentioned sum upon the presentation of a proper refunding bond.
Exception No. 5 to Account No. 7 relates to the failure of the administrators to charge themselves with the sum of $1,100 realized from the sale of certain silverware. At the time of the argument this exception was amended to include a further sum of $1,500 which represents the proceeds of the sale of a gold cup. The evidence in the main case disclosed that the administrators made an attempt to effect a distribution of these articles among the next of kin in which they were not successful. The articles were afterward sold to a jeweler and the proceeds distributed to all the parties except the share of Edwin J. Maloney. A tender was made to Edwin's representative and refused. The administrators, therefore, will be directed to pay to Edwin J. Maloney's estate his share of the proceeds of said sales upon the delivery of a proper bond.
Exceptions Nos. 6 and 7 to Account No. 7 are to the failure of the administrators to account for two items of $13,979.15 and $37,614.39, respectively. The exceptant alleges that these moneys were received for refunds from State and Federal government transfer and inheritance taxes. It appeared at the hearing that the heirs, including Edwin, agreed upon the method of distributing among themselves the refunds above mentioned. Edwin's share was twenty per cent. less four per cent. which he assigned to the Gildeas. He afterward purchased another twenty per cent. which made his total interest in said refunds thirty-six per cent. The refund mentioned in exception No. 6 has been paid and, therefore, that exception is overruled. The refund mentioned in exceptionNo. 7 is held by Mr. Kinkead and Mrs. Gildea, not as administrators, but as bailees. As such, they will be required to turn over the balance, after deducting expenses, due the estate of Edwin upon the execution and delivery of a proper refunding bond therefor.
Exception No. 8 to Account No. 7 is that the administrators failed to charge themselves with the proceeds of the sale of the household furniture etc. The household furniture and automobiles were divided among the parties in interest by themselves shortly after the death of Mr. and Mrs. Maloney and during Edwin's lifetime. It developed at the hearing that this distribution was ratified by Edwin. This exception is, therefore, overruled.
Exception No. 9 to Account No. 7 is that the administrators failed to charge themselves with the value or proceeds of certain life insurance policies covering the life of one Frank Florentine The insurance policies were part of the collateral given to secure the notes mentioned under exceptions Nos. 6 and 7 of this account. The testimony at the hearing revealed that one Leo Florentine, the maker of the notes, had refused to surrender the policies and threatened suit to determine the title to these policies. Any claim which the exceptant may have would not be against the administrators but against those who joined with Edwin J. Maloney as purchasers of the notes in question. The exception, therefore, is overruled.
Exceptions No. 10 and 11 to Account No. 7 relate to the real estate of which Thomas J. Maloney died seized. These transactions occurred prior to Edwin J. Maloney's death and were ratified by him. The exception is, therefore, overruled.
Exception No. 12 to Account No. 7 is that the administrators failed to charge themselves with the value of 642 shares of stock of a newspaper known as the "Hudson Dispatch". This stock was not sold. All of the parties in interest, other than the exceptant, agreed to accept an assignment of their proportionate shares of said stock. The exceptant refused to receive Edwin's share. The administrators will be required to deliver Edwin's proportionate share, which amounts to 103 shares, upon receipt of a proper refunding bond therefor.
Exception No. 13 to Account No. 7 is a blanket exception to all the disbursements set forth in said account, amounting to $683,410.99, on the ground that there were no vouchers to substantiate the disbursements. It appears that there is a typographical error in this amount. The correct amount as appears in the account is $638,410.99 instead of $683,410.99. The only disbursement for which no check or voucher appears is an item of $35 shown on "Schedule D". The administrators should produce satisfactory evidence of this item.
The next exceptions appear as general exceptions to Accounts Nos. 4 to 7 inclusive. Many of these exceptions are repetitions and have been disposed of above. Exception No. l(j) is that the administrators have not charged themselves with income "on the large sums of cash in their hands" during the period covered by the accounts. The accounts disclose that the administrators have charged themselves with some interest. No proof was produced on the part of the exceptant that all interest actually received or earned was not accounted for. See In re Schlosser, supra. The exception is, therefore, overruled.
Exceptions No. l(k, 1, o, p, q, r) are to matters already ruled upon in the main case and are matters in which Edwin J. Maloney participated and consented to during his lifetime. The exceptions are, therefore, overruled.
Exception No. 1 (n) is that the administrators have failed to charge themselves with the amount of excessive inheritance taxes paid to the State of New Jersey and which they neglected to collect from the State. This exception is without merit as stated above under exceptions Nos. 6 and 7 to account No. 7.
Exception No. 1(s, t, u and v) are to the payment of fees to the administrators and their counsel. It is charged these fees are excessive and improper. This court has already ruled on the matter. All of the heirs and next of kin, including Edwin, met and decided upon the amount of commissions and counsel fees to be paid. The payments were made and approved in writing which writing is in evidence. The gross estate amounted to about $4,000,000 and no one of the heirs or next of kin questioned the fees or commissions. This exception is, therefore, overruled.
The final exception is to all the allowances claimed in accounts Nos. 1 to 3 inclusive, which covers the period from January 18, 1933, to June 12, 1934. In the opinion onthe main case it appears that the exceptant was estopped from questioning said accounts for the reason those accounts were ratified by Edwin J. Maloney. The exception, therefore, is overruled.