Jane Rosenberg, the decedent, died possessed of a miscellaneous estate, consisting of mortgages, bank accounts, etc., with a value of something over $60,000. Rose L. Schwobel was appointed administratrix of the estate. She employed the appellant Stanley S. Groggins, an attorney at law, to advise and act for her in matters of the estate. She paid him $7,750 in the course of the administration. This fee was fixed by agreement for his services and disbursements, without regard to the amount of the estate. Before the services were completed she instituted a proceeding under section 231-a of the Surrogate's Court Act. The Surrogate not only reduced the compensation of Groggins as attorney for the administratrix as such, to $4,000, but also directed the attorney to return the sum of $2,750.
The only question here is whether the Surrogate had power to make an order for reimbursement. The Appellate Division has so held, one justice dissenting on the ground that the proper remedy of the administratrix was by action and that the Surrogate's Court had no jurisdiction to compel the return of moneys paid pursuant to contract.
The Surrogate's Court Act, section 231-a, reads as follows: *Page 360
"Compensation of attorneys. At any time during the administration of an estate, and irrespective of the pendency of a particular proceeding, the surrogate shall have power to hear an application for and to fix and determine the compensation of an attorney for services rendered to an estate or to its representative, or to a devisee, legatee, distributee or any person interested therein; or in proceedings to compel the delivery of papers or funds in the hands of such attorney.
"Such proceeding shall be instituted by petition of a representative of the estate, or a person interested, or an attorney who has rendered services. Notice of the application shall be given in such manner as the surrogate may direct. The surrogate may direct payment therefor from the estate generally or from the funds in the hands of the representative belonging to any legatee, devisee distributee or person interested therein."
This section means that the application to fix the compensation of the attorney may be made at any time during the administration of an estate, without waiting for the final accounting when the amount paid the attorney by the personal representative for compensation might be questioned and she might be surcharged with any amount paid in excess of the reasonable value of the services rendered. Here, however, the administratrix did not seek to protect herself by making an application for an order under section 231-a before paying the attorney, but retained him and paid him in advance an amount which she now deems excessive and as to part of which the court has summarily ordered reimbursement.
The attorney, Groggins, did not receive money for his client, as in Matter of Anderson (136 Misc. Rep. 110; 232 App. Div. 704; 257 N.Y. 592). In such a case the power of the courts to make summary orders directing attorneys to turn over moneys received by them for their clients is unquestioned. (Schell v.Mayor, 128 N.Y. 67; Matter of Bailey v. Rutherford,242 N.Y. 220, 223, 224.) *Page 361 A voluntary payment by a client for legal services is not a case in which such peremptory order should be made. The rights of the parties should be litigated in the ordinary way. (Matter ofJeffries, 219 N.Y. 573.)
As was recently said in Matter of Fromberg (260 N.Y. 430,432): "Judicial power relates to the protection of the estate and not to supervision of personal contracts made by an individual who is not a ward of the court and who is individually liable upon them."
An attorney has the right to have claims against him established by action, except only in the case where he withholds money or property from his client which he is in duty bound to turn over to such client. There he may be dealt with summarily as an officer of the court.
The orders should be modified by striking out so much thereof as direct the return of $2,750, and as so modified affirmed, with costs against the respondent Schwobel personally in this court and in the Appellate Division.