Anderson v. Anderson

OPINION

GONZALEZ, Justice.

This is an appeal from an order allowing the payment of attorney’s fees out of the assets of an estate pursuant to Texas Probate Code Ann. § 243 (Vernon 1974). The will established a trust for the benefit of the deceased’s two minor children, appellants, and their uncle, appellee, was named executor of the estate and trustee. Prior to the death of the deceased, the uncle caused to be executed “change of beneficiary” forms with himself named beneficiary of the life insurance proceeds and stock which were the principal assets of the estate. The uncle employed an attorney to probate the will and the children sought to have him removed as executor and trustee of the will and also to cancel the change of beneficiary designations. The children prevailed. After the judgment became final, the uncle’s attorney made a claim against the estate for payment of his attorney’s fees. This was approved by the court in an ancillary proceeding. We reverse and render.

A history of the case is necessary in order to put the issue before the court in its proper perspective.1

In 1975, Wesley Gene Anderson, a single man, was dying of lung cancer. He executed a will in which he created a trust for the benefit of his minor children, Michael Gene Anderson and Sheri Jean Anderson, appellants, herein. He named his brother, J. C. Anderson, appellee herein, independent executor and trustee of the estate. The estate, at the time of the creation of the trust, consisted of the expected proceeds of a life insurance policy on the life of the testator and some stock, with an aggregate value of approximately Seventy Five Thousand Dollars ($75,000). The trust was to expire in 1989 with the proceeds being divided equally among the two children.

Thereafter, J. C. Anderson caused Wesley Gene Anderson to sign change of beneficiary designations of the life insurance policy and the stock and named himself as beneficiary thereby leaving the children’s trust unfunded.

In May 1976, Wesley Gene Anderson died and in June 1976, J. C. Anderson filed the will for probate in the probate court of Refugio County. Shortly thereafter in June 1976, appellants through their next friend filed a will contest and this suit was transferred to the district court of Refugio *57County. In July 1976, a new suit was filed by the children seeking to set aside the two change of beneficiary designations above mentioned. In September 1976, the application for probate and the suit seeking cancellation of the beneficiary designations were consolidated by the court into Cause No. 5036. In June-July 1978, upon motion of the appellants, the court ordered J. C. Anderson to obtain separate counsel to represent himself individually and to represent him as independent executor of the estate of Wesley Gene Anderson. Attorney John Miller, Jr. was retained to represent J. C. Anderson as independent executor of the estate. On February 1979, Cause No. 5036 went to trial before a jury. After the announcement of ready, appellants withdrew their contest to the probating of the will with the exception of the appointment of J. C. Anderson as independent executor. The will was admitted for probate by the court sitting without a jury with the exception of the appointment of an independent executor. Mr. John Miller left the courtroom2 and the case proceeded to trial with appellants seeking cancellation of the beneficiary designations and also seeking the removal of J. C. Anderson as executor and trustee of the estate. The jury found that J. C. Anderson had completed the change of beneficiary designations contrary to the instructions of Wesley Gene Anderson; that J. C. Anderson knew that the designations were contrary to his brother’s instructions; and that the deceased was not aware that the designations had been completed contrary to his instructions.3 The court denied J. C. Anderson’s application to be appointed independent executor of the estate and appointed Corpus Christi National Bank, the named substitute executor under the will.

The final judgment of the court was signed on March 17, 1980, and the court ruled that all costs were to be paid by J. C. Anderson. In July 1979, approximately four (4) months after the trial, John Miller filed a claim with Corpus Christi National Bank for payment of his attorney’s fees in the amount of Six Thousand Five Hundred Seventy Dollars ($6,570). Appellants objected to the payment of the attorney’s fees and on September 10, 1979, the bank approved the claim and thereafter this claim was submitted to the district court in Cause No. 5036. Appellants again filed objections to the payment of said claim.

On December 16, 1980, a hearing was held on Mr. Miller’s claim for compensation and the court on January 19, 1981 entered an order granting Mr. Miller’s claim for attorney’s fees and this order is the basis of this appeal.

Appellants bring six points of error. They contend that the trial court did not have jurisdiction to award attorney’s fees because the judgment had become final; that John Miller had no standing to bring the claim for attorney’s fees because § 243 of Probate Code requires that the claim be brought by the independent executor of the estate; that the Probate Code requires that the claim for attorney’s fees be brought in the original probate proceedings and not as an ancillary matter; that the final judgment adjudged all cost against J. C. Anderson and, therefore, the court had no jurisdiction to adjudge costs against the estate, and that there is either no evidence or insufficient evidence to support and award against the estate for the attorney’s fees.

Section 243 of the Texas Probate Code provides:

“When any person designated as executor in a will, or as administrator with the will annexed, defends it or prosecutes any proceeding in good faith, and with just cause, for the purpose of having the will *58admitted to probate, whether successful or not, he shall be allowed out of the estate his necessary expenses and disbursements, including reasonable attorney’s fees, in such proceedings.”

The Supreme Court in Russell v. Moeling, 526 S.W.2d 533, 535 (Tex.Sup. 1975) said:

“The import of the statute is clear: the executor administrator ‘shall be allowed out of the estate his necessary expenses and disbursements.’ The purpose then is to pay the cost of attorney’s fees that are owed by the executor or administrator and the allowance is not to the attorney, but to the administrator.” [citations omitted, emphasis ours.]

Therefore, § 243 of the Texas Probate Code by its very language allows the independent executor to make a claim against the estate for necessary expenses and disbursements including attorney’s fees incurred in admitting a will to probate. In the case at bar, the independent executor did not make such a claim but the claim was made by the attorney, John Miller. We agree with appellants that John Miller did not have standing to bring the claim against the estate.

Even if Mr. Miller had had standing, the issues of good faith and probable cause were not submitted in the original probate proceedings as required by law.

The Supreme Court has set forth this rule clearly in Russell v. Moeling, Id. 535, 536, wherein the court stated:

“With reference to the administrator’s argument to the effect that any claim for attorneys’ fees and expenses must be brought, if at all, in the original will contest, we must turn first to this court’s decision in Huff v. Huff, 132 Tex. 540, 124 S.W.2d 327 (1939) .... The holding in Huff, which denied to the executor the right to seek attorneys’ fees in a subsequent proceeding, was construed by the court of civil appeals opinion in the instant case as one turning entirely on the fact that the executor had been found guilty of exercising undue influence upon the testator. We do not agree. The Huff decision ... went on to point out:
‘We think that the executor could have had submitted to the jury, along with the other issues, the question of good faith on his part in offering the will for probate; and if the jury had found that, under the circumstances, he had acted in good faith, then he would have been entitled to judgment for such attorneys’ fees and court costs. This was not done; and the judgment became final. We do not think the rule should be extended further than this, in order to let him recover in a subsequent suit.’ [Emphasis added.]
The determination fact in Huff then, which would likewise be controlling in the instant case, is the fact that the trial court’s judgment, probating the will and awarding costs, had become final and that the prior proceeding was the proper time to have made the claim.”

Notwithstanding the above, it is clear from the record that the estate would not benefit but in fact suffer a detriment as a result of the actions of J. C. Anderson.4 To now order the same estate that he attempted to defraud to pay his attorney’s fees is unjust and against public policy. See Huff v. Huff, 124 S.W.2d 327 (Tex.Sup. 1939).

The judgment of the trial court is reversed and a take nothing judgment is rendered.

Our opinion should not be deemed as conclusive or prejudicial to the right of Mr. Miller to prosecute a claim for attorney’s fees against J. C. Anderson individually.

. This appeal is a companion case to Anderson v. Anderson, 618 S.W.2d 927 (Tex. Civ. App.—Houston [1st Dist.] 1981, writ dism’d). This case was transferred by the Supreme Court to the 1st Court of Appeals pursuant to a docket equalization order.

. Miller had not completed his job. He was proponent of all of the will, not just part of it. His client was seeking to be named Independent Executor under the will. This certainly was a contested matter and, therefore, the case continued to be a “will contest.”

. The jury also found that J. C. Anderson had acted with malice and awarded the children Fifty Thousand Dollars ($50,000) punitive damages. The court declared the change of designation of beneficiary null and void but set aside the jury’s answers regarding punitive damages. These matters are the subject of the previously mentioned appeal in the 1st Court of Appeals.

. At the time of the trial, Miller’s claim for $6,570 attorney’s fees exceeded the value of the estate.