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In Re Estate of Bonnett

OPINION FILED SEPTEMBER 6, 1977.

IN RE ESTATE OF LYLE J. BONNETT, DECEASED. — (HARRY KUHL ET AL., PETITIONERS-APPELLANTS,

v.

YVONNE BUELOW ET AL., RESPONDENTS-APPELLEES.)



APPEAL from the Circuit Court of Jo Daviess County; the Hon. JAMES B. VINCENT, Judge, presiding.

MR. PRESIDING JUSTICE RECHENMACHER DELIVERED THE OPINION OF THE COURT:

This is an appeal from the order of the circuit court of Jo Daviess County fixing fees for services performed by the appellants as executor and as attorney for the estate of Lyle J. Bonnett, deceased.

Harry Kuhl, is executor under the will of Lyle J. Bonnett, and Michael A. Stapleton acted as attorney in the administration of the estate. The court allowed Kuhl $5,500 for his services as executor and Stapleton $6,500 for his legal fees. Stapleton in this appeal claims his services were worth approximately $10,200 and Kuhl claims he should have received about $6,900 as fair remuneration.

The decedent owned a business which was split into two operations — the Frentress Lake Marine Center, which serviced and repaired boats, and the Lyle Bonnett Marina, which provided docks, slips, etc. for docking and storing boats. The estate, including real estate valued at $12,000 in Iowa, was valued at a little over $126,000. An appraisal of the business itself found its value to be approximately $48,230 for the Marine Center and $50,450 for the Marina operation, but the Marine Center owed $9,200 to the East Dubuque Savings Bank.

Upon the death of Lyle J. Bonnett, his heirs thought it best to try to sell the two operations as a unit. There were several difficulties in doing so, however, one of which was that Lyle J. Bonnett did not own the land on which the business was located — it was leased to him by Arthur Gill, who in turn leased this site from the United States Department of the Interior. The duration of Gill's lease was uncertain, depending upon the Department's decision whether or not to renew it. There was no right of renewal in the leases from the Department, however, there was no testimony in the record suggesting that the leases would not be renewed.

The initial attempt to sell the business fell through. In addition to purely financial considerations and the nature of the leasehold interest, etc., the negotiations were hampered by windstorm damage which occurred between the death of Bonnett and the opening of the estate, which damage was followed a week or so later by a fire which further damaged the facilities. The fire and windstorm damage was not repaired promptly, but whether this was due to the inertia of the agent, the procrastination of the insurance adjuster, or some technical question based on the nature of the damage, is not clear.

After some delay the fire and windstorm damage was satisfactorily adjusted and the negotiations for the sale of the business continued. After some further difficulties, the business was sold as a unit to a buyer suggested by Mr. Gill.

In support of his claim of $3,820 for extraordinary compensation above the customary fee based on the gross estate, attorney Stapleton made much of the satisfactory settlement achieved in the insurance claims and the difficulties he had to overcome in selling the business for a figure around the appraised value. He calculated his extraordinary time in achieving these results as being worth $3,820 in addition to $6,340 for ordinary services, based on 5% of the gross value of the estate. Exactly what the number of hours or the charge per hour was in this calculation of extraordinary time is difficult to determine. In his application for attorney fees Stapleton stated that his extraordinary time amounted to 67.2 hours, but in his actual testimony he referred to 74.2 hours of extraordinary time. However, the $3,820 he claims apparently represents 76.4 hours, if valued at $50 per hour. Attorney Stapleton testified he justified this figure on the basis of the "results obtained," apparently referring to the insurance settlement and the satisfactory sale of the business.

The executor, Mr. Kuhl, testified that he also spent extraordinary time in performing his duties for the estate, however, he did not itemize the hours he spent and it appears his claim is based on what he said was the customary fee of 6% of the estate, that is, 6% of approximately $115,000 (excluding the Iowa property worth $12,000), or $6,900.

Two practicing attorneys testified on behalf of Kuhl and Stapleton. Both attorneys testified that they based the fees for the executor, Kuhl, on 6% of the gross estate, excluding the Iowa property, which produced a fee of $6,900. Attorney Nagel estimated the value of Stapleton's services at $9,000 and attorney Nack figured Stapleton's services to be worth $9,200. On the Federal Estate Tax return attorney Stapleton had estimated fees at $6,000 each for himself and Kuhl. The heirs had approved this charge.

Both the extent and the value of attorney Stapleton's extraordinary efforts on behalf of the estate were disputed by the heirs. Yvonne Buelow, the decedent's daughter, testified that as to the insurance claim, Mr. Stapleton had very little to do with getting it settled; that apparently the claim had not been pressed by anyone until the insurance agent himself — who owned a boat and was being inconvenienced by the failure to make repairs to the dock facilities — complained to her — Yvonne Buelow — about the delay. She testified that when she explained to him that nothing was being done to adjust the claim, the agent, Mr. Butler, got the adjuster over to the scene right away and both claims were quickly settled without any difficulty. According to the testimony of Yvonne Buelow, attorney Stapleton's intervention was not required to settle the insurance claims on an equitable basis, since there was no argument or disagreement as to the amount to be recovered and Mr. Stapleton had not been hired on a contingent basis or otherwise to represent the heirs in connection with the insurance claims.

As to the sale of the business, here again, the detailed testimony of Yvonne Buelow refuted attorney Stapleton's claim to have been responsible for an advantageous result. She testified that it was actually Art Gill, the lessee of the land from the Department of the Interior, who brought about the sale to Petitgout. There appears to be a direct conflict between Stapleton's claim that the sale to Petitgout was effected through his efforts with Petitgout and Kuhl's efforts with Art Gill, and Mrs. Buelow's testimony indicating that the main effort was that of Gill in persuading Petitgout and assisting him to obtain financing. She said: "Mr. Gill is the one that helped us out of the whole thing and he is the one that has spent the hours and the time."

• 1 There was, therefore, conflicting testimony on the question of the extraordinary services performed by attorney Stapleton, which conflict the trial court had the right and the duty to resolve, within the limits of a reasonable discretion.

Attorney Stapleton contends in this appeal that the trial court acted arbitrarily in setting the fees at $6,500 for him and $5,500 for Kuhl, inasmuch as the expert testimony indicated much higher fees to be proper. He suggests that the trial court merely rearranged the apportionment of the estimated fees as shown on ...


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