Surcharging Estate Counsel for Wasteful Litigation Strategy:
Commentary on Matter of Estate of Ingber, 2025 NY Slip Op 06935

I. Introduction

Matter of Estate of Ingber is a significant Surrogate’s Court practice decision from the Appellate Division, Third Department, dealing with:

When an estate fiduciary (here, a coexecutor who is also counsel to the estate) can be personally surcharged for decisions about litigation and settlement;
How far the law of the case doctrine constrains a Surrogate’s continuing supervision of an estate;
The interaction between estate administration, parallel civil litigation, and creditor claims based on a deficiency judgment and personal guaranty;
The use of laches and mootness to resolve downstream challenges; and
The court’s power to control counsel fees and protect creditors as well as beneficiaries when estate assets are at risk of being consumed by litigation.

At its core, the decision affirms a substantial surcharge against attorney–coexecutor Keith Ingber, premised not on theft or self-dealing in the classic sense, but on a pattern of unreasonable litigation conduct: refusing favorable settlement offers, failing to prosecute a potentially valuable lawsuit, repeatedly disobeying court directions, and generating legal fees disproportionate to the size of the estate and the realistic benefit to its beneficiaries.

The case thus refines and extends New York’s jurisprudence on the “prudent person” standard for estate fiduciaries, confirming that:

Litigation and settlement decisions are part of the fiduciary’s duty of prudence and loyalty, and
Failure to act prudently in that sphere may support a personal surcharge measured by the value the estate would have retained had the fiduciary acted properly.

II. Factual and Procedural Background

A. The Underlying Loan, Foreclosure, and Deficiency Judgment

In 2003, 230-275 Realty, LLC executed a promissory note in favor of Catskill Hudson Bank (the respondent).
The LLC gave a mortgage on commercial property as security.
Decedent Jack S. Ingber, a managing member of the LLC, later:
- Executed a personal guaranty of the LLC’s debt; and
- Entered into a commercial pledge agreement giving the bank a security interest in 8,384 shares of the bank’s own stock as additional collateral.
Important context (Footnote 1): Decedent had been involved in founding respondent bank and had served as its chairperson and counsel before retiring.

In 2009, the bank brought a foreclosure action in Supreme Court, Sullivan County, against the LLC and John Does, but not against decedent personally.

The LLC responded with counterclaims sounding in:
- Fraud,
- Tortious interference with contract, and
- Breach of fiduciary duty,
alleging that the bank’s conduct caused the loss of a tenant and thus the LLC’s inability to service the mortgage.
In 2011, Supreme Court (Gilpatric, J.):
- Dismissed the LLC’s counterclaims and related third‑party claims (Footnote 2); and
- Entered a judgment of foreclosure and sale in favor of the bank.
No appeal was taken from the foreclosure judgment.
In 2013, after the bank purchased the property at auction for $50,000, the court:
- Fixed fair market value at $125,000; and
- Entered a deficiency judgment against the LLC for $250,010.58.
The bank enforced the pledge agreement:
- Reacquired decedent’s 8,384 pledged shares as treasury stock; and
- Credited $152,169.60 against his indebtedness, valuing the stock at $18.15 per share.

B. The Orange County Litigation Over the Stock Pledge

In 2015, decedent sued the bank and others in Supreme Court, Orange County, challenging the bank’s acquisition of his stock. His complaint included, among others:

First cause of action: Breach of the pledge agreement for failure to give proper notice of the stock sale;
Second cause of action: Deprivation of his asserted right to redeem the stock;
Fourth cause of action: Breach of fiduciary duty by the bank; and
Later, a Ninth cause of action (added in 2017): For a declaration that enforcement of the pledge was time-barred and for return of the stock.

Decedent died in 2016, a resident of Sullivan County. His children, Keith IngberAudrey Inger Bender, became:

Coexecutors of his estate under his will, and
The primary beneficiaries (aside from nominal charitable bequests).

Keith Ingber also served as counsel for the estate (Footnote 3), though not attorney of record in the Orange County action; he had arranged with lead counsel to prepare all papers there.

In 2018, Orange County Supreme Court (Onofry, J.):

Granted leave to amend to add the ninth cause of action, but
Granted the bank’s cross‑motion for summary judgment, dismissing the entire third amended complaint.

C. Commencement of the Estate Proceeding and the Bank’s Claim

While an appeal from the Orange County summary judgment order was pending, the coexecutors commenced a probate proceeding in Surrogate’s Court, Sullivan County (SCPA art. 22 accounting).

The bank filed a creditor’s claim against the estate totaling $209,132.31, consisting of:

The amount then due on the LLC deficiency judgment: $121,323.06; and
Three personal loans made directly to decedent during his life: $87,809.25.

The coexecutors moved to:

Dismiss the bank’s claim, or
Alternatively, obtain a stay of Surrogate’s Court proceedings pending resolution of the Orange County appeal.

In July 2019, Surrogate’s Court (LaBuda, S.):

Held that the bank’s claim was valid and enforceable, based on the documentation;
Rejected efforts to collaterally attack:
- the deficiency judgment, and
- the Orange County order,
through the probate proceeding; but
Granted leave to seek an amended judicial settlement if the Second Department later reversed the Orange County order.

The bank then offered to settle its claim:

For the value of the personal loans alone (i.e., dropping the deficiency component),
In exchange for discontinuance of the Orange County action and mutual releases.

The coexecutors rejected that offer. In 2020, the Third Department (Matter of Ingber, 189 AD3d 1933) upheld the Surrogate’s decision recognizing the bank’s claim, while again noting that the accounting might be amended if the Second Department modified the Orange County order.

D. The Second Department’s Partial Reinstatement of the Orange County Claims

In February 2021, the Second Department decided Ingber v Martinez, 191 AD3d 959 (2d Dept 2021). It:

Found that the bank’s proof of compliance with the pledge agreement consisted of hearsay without a proper foundation;
Held the bank had not made a prima facie showing on summary judgment as to:
- the first cause of action (lack of notice of stock sale),
- the second cause of action (right of redemption), and
- part of the ninth cause (to the extent it sought a declaration that the bank need not return the stock);
Therefore reinstated those claims;
However, it rejected arguments that enforcement of the guaranty and pledge was time‑barred;
It also reinstated the fourth cause of action for breach of fiduciary duty, holding that the prior foreclosure judgment did not collaterally estop decedent (or his estate), as he had not been a party to that case.

Following this partial appellate victory, the coexecutors attempted to file an amended accounting in Surrogate’s Court that simply omitted the deficiency judgment, arguing that:

The Second Department’s ruling meant the statute of limitations had run; and
Decedent could not be held personally liable under the guaranty or pledge because he had not been named in the foreclosure action.

They also rejected another offer by the bank to settle the estate’s exposure for the amount of the three personal loans only. Despite claiming high confidence in the Orange County action, they took no steps to resume active prosecution of that litigation.

E. The October 2022 Surrogate’s Order: Capping Fees and Warning of Surcharge

In October 2022, Surrogate’s Court (Farrell, S.) issued a critical order:

It rejected the amended accounting that excluded the deficiency judgment, holding that the Second Department’s order did not render the deficiency inapplicable to decedent or his estate.
It denied the bank’s concurrent application to remove the coexecutors for waste, in part to avoid thwarting decedent’s testamentary intent.
But it found that the $282,000 in legal fees sought by Ingber—exceeding the total estate value—were “grossly excessive.”
It therefore capped total legal fees at $75,000, including certain fees already paid for the Orange County litigation.
Most importantly, it warned the coexecutors that any future dilatory conduct could result in:
- removal,
- possible surcharge, and
- loss of commissions,
and ordered a final accounting within 60 days.

The coexecutors did not comply with these directives, nor with later scheduling orders or an order to sell remaining bank stock (5,852 shares) despite a pending offer that exceeded their valuation.

Eventually, on January 17, 2023, they advised that the estate had accepted a nonparty offer to purchase the remaining stock for $26 per share. A final accounting reflecting the sale was filed on February 6, 2023, but without proper supporting documentation. During this period, they again rejected the bank’s offer to settle for the personal loan balances only, relying on their asserted likely success in Orange County—though they continued not to advance that case.

F. The Amended Final Petition and the May 2023 Order and Decree

In April 2023, the coexecutors filed an amended final petition seeking approval of:

Executor commissions: $22,900.48;
Remaining legal fees (within the earlier cap): $60,355.49;
Administration expenses: $31,664.64;
Paid creditors’ claims: $11,004.60; and
Unpaid creditors’ claims: $107,971.43.

(They had also abandoned an “Office” claim of $30,162.18 after failing to substantiate it, per Footnote 4.)

In May 2023, Surrogate’s Court:

Found total adjusted principal received by the estate to be $247,340.15;
Generally approved administration expenses and commissions, with a minor adjustment;
As to remaining counsel fees, found that Ingber had:
- Acted against the interest of the estate;
- Pursued a course geared toward frustrating the bank’s claim and increasing its counsel fees; and
- Failed to heed earlier warnings and orders.
Imposed a personal surcharge on Ingber of $34,718.96, calculated as:
- the amount that would have remained in the estate after fees and claims had he accepted the bank’s earlier settlement offers.
Approved only $25,636.53 in additional counsel fees (within the global cap, adjusted downward because of the surcharge).
Approved paid creditors’ claims.
Given petitioners’ failure to prosecute the Orange County action for over two years after the Second Department’s decision, charged the estate with the entire deficiency judgment amount ($209,132.31), which would still only be partially satisfied by remaining estate funds after application of the surcharge ($157,247.16 cash on hand).

The coexecutors appealed from the May 2023 order and decree.

G. Subsequent Laches Dismissal of the Orange County Action

About a year after the May 2023 order—and more than three years after the Second Department’s 2021 decision—the coexecutors finally moved to revive the Orange County action. Their renewed interest coincided with a public announcement that the bank’s stock would be sold at $40 per share in a merger, apparently heightening the perceived value of recovering the 8,384 pledged shares.

In November 2024, Supreme Court (Squirrell, J.) dismissed the remainder of the Orange County case on the ground of laches, based on the long delay in prosecution. The bank advised, and petitioners did not dispute, that no appeal was taken from that dismissal.

III. Summary of the Appellate Division’s Decision

On appeal, the Third Department (Garry, P.J., writing; Clark, Aarons, Lynch and Powers, JJ., concurring) affirmed the order and decree in all respects.

Key holdings:

Fiduciary surcharge upheld. The court held that Ingber, as a fiduciary (counsel for the estate and coexecutor), breached his duty of prudence and loyalty by:
- persisting in an uneconomic litigation strategy,
- rejecting reasonable settlement offers that would have left the estate materially better off,
- failing to prosecute the Orange County claims he claimed were so valuable, and
- disregarding Surrogate’s Court’s orders and warnings.
The surcharge amount was appropriate, aimed at placing the bank in the position it would have occupied had Ingber properly discharged his fiduciary duties.
Law of the case rejected as a bar. Petitioners’ argument that the prior October 2022 order (capping legal fees at $75,000 and declining to remove them as coexecutors) constituted “law of the case” that barred any later surcharge was rejected. The court explained that:
- The October 2022 fee cap did not resolve the separate issue of a subsequent surcharge based on later conduct; and
- The decision not to remove the coexecutors did not preclude the Surrogate from later imposing a surcharge.
Deficiency judgment treatment. The court rejected any suggestion that the Second Department’s 2021 decision or any other ruling required Surrogate’s Court to treat the deficiency judgment as invalid or inapplicable to the estate. Surrogate’s Court properly considered petitioners’ failure to produce results in the Orange County action in deciding the surcharge.
Mootness of challenges to charging the estate with the deficiency. Because the Orange County action had since been dismissed on laches (unappealed), any appellate challenge to the May 2023 decision charging the estate with the deficiency was held moot (citing Stefanik v Hochul).
Judicial bias claim unpreserved. Petitioners’ allegations of bias by Surrogate’s Court were not reviewable, as there had been no objection or recusal motion (citing Whitfield and Theodore P.).
All remaining arguments rejected. Any other contentions not explicitly addressed were examined and found meritless.

IV. Detailed Analysis

A. Precedents on Fiduciary Duties and Surcharge

The Third Department anchors its analysis in a well‑developed line of New York cases on the duties of fiduciaries (executors, trustees, etc.) and the circumstances under which a surcharge is appropriate.

1. Matter of Donner, 82 NY2d 574 (1993)

The court quotes Donner for two propositions:

Fiduciaries owe a duty of undivided loyalty and must preserve the assets entrusted to them (82 NY2d at 584).
A surcharge is warranted where financial loss results from failure to act with the care of “prudent persons of discretion and intelligence in such matters” in their own affairs (id. at 585).

Donner emphasized that a fiduciary’s conduct is measured not by hindsight but by whether it conformed to the prudent person standard under the circumstances then existing.

2. Matter of Janes, 90 NY2d 41 (1997)

Janes is cited for the point that there is no rigid formula for assessing the prudent person standard, which requires a fact‑specific inquiry (90 NY2d at 50).

In Janes, the Court of Appeals imposed a surcharge on an executor for failing to diversify an estate’s over‑concentrated investment portfolio and thereby causing loss. In Ingber, the Third Department extends that reasoning into the context of:

Litigation management, and
Settlement decision‑making.

3. Appellate Division Surcharge Cases: Shambo, Jewett, HSBC Bank [Knox], Blaine, Scott

Matter of Shambo, 169 AD3d 1201 (3d Dept 2019):
- Cited for the principle that a surcharge should aim to place affected parties in the position they would have been in had the fiduciary met the standard of care (169 AD3d at 1207).
- Also supports using a “make‑whole” measure of damages against the fiduciary.
Matter of Jewett, 145 AD3d 1114 (3d Dept 2016):
- Reinforces that surcharge is available when fiduciaries violate the prudent person standard and cause loss (145 AD3d at 1124).
Matter of HSBC Bank USA, N.A. [Knox], 98 AD3d 300 (4th Dept 2012), lv dismissed 20 NY3d 1056 (2013):
- Illustrates judicial willingness to hold institutional fiduciaries to strict prudence standards.
Matter of Blaine, 209 AD3d 1124 (3d Dept 2022):
- Again, endorses a fact‑intensive approach to evaluating fiduciary conduct.
Matter of Scott, 234 AD2d 551 (2d Dept 1996):
- Used to support the notion that courts may surcharge fiduciaries for mismanagement even absent outright misappropriation.

These authorities collectively underline the core propositions the court applies here:

The fiduciary’s duty of loyalty and prudence extends to all estate management activities, including litigation.
When that duty is breached, a surcharge is appropriate, not as punishment, but as compensation for the loss caused by the breach.

B. Law of the Case: Why the Earlier Fee-Cap Order Did Not Bar the Surcharge

Petitioners argued that because Surrogate’s Court had capped legal fees at $75,000 in the October 2022 order and had declined to remove them as coexecutors, it could not later impose a surcharge without violating the law of the case doctrine.

1. The Doctrine

The Third Department relies on its own precedent in Gulf Coast Bank & Trust Co. v Virgil Resort Funding Group, Inc., 201 AD3d 1086 (3d Dept 2022), lv denied 38 NY3d 909 (2022), and Karol v Polsinello, 127 AD3d 1401 (3d Dept 2015), to explain:

Law of the case is a “judicially crafted policy” reflecting the general practice of courts to avoid revisiting earlier rulings in the same case.
It typically applies in:
1. Situations where a second court of coordinate jurisdiction is confronted with an issue previously decided in the same case; and
2. Cases on remand, where a lower court is bound by a reviewing court’s determinations.

It is not, however, a rigid rule of res judicata; it is discretionary and context‑dependent.

2. Application in Ingber

The Third Department concludes that the law of the case doctrine does not apply to bar the later surcharge because:

The October 2022 order addressed:
- Reasonableness of counsel fees up to that point; and
- Whether to remove the coexecutors.
The later May 2023 order addressed:
- Whether, on the totality of conduct (including post‑October 2022 behavior), a surcharge on counsel was appropriate; and
- What amount was necessary to make the estate whole, relative to lost settlement opportunities.

The October order did not purport to finally resolve the question of surcharge, nor did it grant counsel immunity from further consequences. Indeed, that order:

Warned of possible future surcharge if petitioners continued dilatory or wasteful conduct.

Thus, there is no inconsistency: the earlier order addressed a different legal question (fee caps and removal) at an earlier time. It did not establish binding “law of the case” preventing the Surrogate from later responding to new or ongoing misconduct.

C. Fiduciary Misconduct in Litigation Management and Settlement Decisions

The heart of the court’s reasoning is its application of the prudent person standard to Ingber’s litigation and settlement strategy. The decision underscores that fiduciary misconduct need not involve embezzlement or classic self‑dealing; it can consist of:

Refusing reasonable settlements;
Perpetuating meritless or uneconomic litigation; and
Ignoring court orders in ways that generate unnecessary fees and delay.

1. Key Factors Supporting the Surcharge

The Third Department highlights several factors:

Size and composition of the estate. The estate was relatively modest, with adjusted principal of about $247,340.15. Ingber’s fee demand of $282,000 was larger than the entire estate, and the bank’s claim—if fully recognized—would leave limited residual value for beneficiaries. The Surrogate concluded there was no meaningful net benefit to the beneficiaries from continued hard‑fought litigation versus a negotiated settlement.
Repeated rejection of favorable settlements.
- The bank repeatedly offered to compromise its claim down to the personal loan balances only, effectively waiving the deficiency judgment.
Failure to prosecute the Orange County action.
- After the Second Department’s 2021 decision reinstating several claims, petitioners:
  - Did nothing to push that litigation forward for over two years; and
  - Later made only a belated attempt to revive it, which was rejected on laches grounds.
- This inaction ultimately caused the loss of any potential benefit from those claims—strong evidence that Ingber’s strategy was more about obstruction than rational pursuit of value.
Noncompliance with Surrogate’s directives.
- Failure to timely file a final accounting, despite explicit deadlines;
- Failure to comply with scheduling orders;
- Failure to timely sell remaining bank stock despite a suitable offer; and
- Repeated submission of defective or incomplete interim accountings, forcing the bank to incur added legal expense and the court to expend additional resources.
Self‑interested fee maximization.
- The Surrogate expressly found that Ingber’s conduct was aimed at “frustrating respondent’s claim and increasing respondent’s counsel fees,” rather than benefiting the estate.
- His dual role as coexecutor, beneficiary, and counsel sharpened the conflict: the more he litigated, the more fees he would generate for himself, potentially at the expense of both the estate and its creditors.

2. Measuring the Surcharge: Hypothetical “But-For” Position

Following Shambo, Jewett, and related cases, the Third Department endorses the Surrogate’s approach to calculating the surcharge:

The goal is not punishment but to place the affected party—in context, both the estate and effectively the creditor bank—in the position they would have been in had the fiduciary performed properly.
Here, that meant asking:
- “How much would have remained in the estate after fees and claims if the bank’s settlement offer had been accepted?”
The answer: approximately $34,718.96. That figure became the amount of the surcharge imposed personally on Ingber.

This is an important doctrinal refinement: the court approves a “lost settlement opportunity” measure of damages against a fiduciary. It signals that refusal to accept a prudent settlement, when combined with failure to pursue the alternative claims and resulting loss, can itself be a compensable breach of fiduciary duty.

D. Treatment of the Deficiency Judgment and Collateral Attacks

A recurring theme in the case is the estate’s effort to treat the foreclosure deficiency judgment as effectively inapplicable to decedent personally, on the theory that:

Decedent was not a party to the foreclosure action; and
The Orange County litigation would establish infirmities in the enforcement of the guaranty and pledge.

However:

Surrogate’s Court (LaBuda, S.) had previously held (2019) that the bank’s claim based on the deficiency judgment and personal loans was valid and enforceable.
The Third Department in 2020 upheld that determination (189 AD3d 1933), subject only to possible later accounting adjustment if the Second Department’s action materially altered the landscape.
When the Second Department did later act, it:
- Reinstated certain claims relating to the pledge; but
- Expressly rejected the theory that the guaranty and pledge were time‑barred.

Crucially, neither the Second Department’s decision nor any other ruling invalidated the deficiency judgment or declared that decedent’s estate was not liable. The Third Department in Ingber emphasizes this:

Surrogate’s Court was not required to treat the deficiency as nullified or inapplicable; and
It properly considered petitioners’ lack of results in the Orange County action in deciding to:
- Refuse to eliminate the deficiency from the estate accounting; and
- Impose a surcharge and ultimately charge the estate with the full deficiency.

In effect, the estate’s attempts to collaterally attack the deficiency judgment and related orders through Surrogate’s Court were repeatedly rejected at each judicial level. The later laches dismissal of the Orange County action only confirmed that no offsetting recovery would be forthcoming.

E. Mootness After Laches Dismissal

By the time the Third Department decided the appeal, the Orange County action had been dismissed for laches, and no appeal had been taken. That dismissal solidified the estate’s inability to obtain any recovery there.

The court, citing Stefanik v Hochul, 229 AD3d 79, 82 n 3 (3d Dept 2024), affd 43 NY3d 49 (2024), applied the doctrine of mootness:

Any challenge to the Surrogate’s decision to charge the estate with the deficiency judgment based on the then-possible success of the Orange County action was now academic.
Since the Orange County claims had been definitively extinguished, there was no longer any live controversy about whether the deficiency should have been offset or reduced.

Thus, the court declined to entertain further argument on that aspect of the May 2023 order.

F. Allegations of Judicial Bias and the Requirement of Preservation

Petitioners raised claims of judicial bias or prejudice by Surrogate’s Court. The Third Department dismissed these as unpreserved:

There had been no objection raised in Surrogate’s Court on bias grounds;
Nor any motion seeking the Surrogate’s recusal.

Relying on Whitfield v Law Enforcement Empls. Benevolent Assn., 237 AD3d 1139 (2d Dept 2025) and Theodore P. v Debra P., 209 AD3d 1146 (3d Dept 2022), the court reiterates:

Allegations of judicial bias generally must be raised in the court where the alleged bias occurred;
Absent such a motion or objection, the issue is not preserved for appellate review.

V. Complex Concepts Simplified

1. Fiduciary Duty of Executors and Estate Counsel

A fiduciary (like an executor, trustee, or estate attorney acting in a fiduciary role) must:

Act loyally and solely in the interest of the estate and beneficiaries;
Use the care and skill of a prudent person managing their own property of similar size and character; and
Avoid conflicts of interest and self‑dealing.

In Ingber, Keith Ingber wore multiple hats:

Coexecutor,
Primary beneficiary, and
Estate counsel (in practical if not formal appearance terms).

This heightened the risk that litigation decisions could be driven by his personal interests (fees, desire to vindicate decedent personally, animus toward the bank) rather than the economic best interests of the estate.

2. Surcharge

A surcharge is a personal judgment against a fiduciary to compensate for loss caused by a breach of fiduciary duty. It can cover:

Lost income or capital caused by imprudent investment or retention;
Excessive or unreasonable fees improperly taken from the estate; or
Lost opportunities, such as failure to pursue or accept a beneficial settlement.

Here, the surcharge of $34,718.96 represents what would likely have remained in the estate had Ingber accepted the bank’s settlement offers, instead of persisting in fruitless, costly litigation.

3. Deficiency Judgment

In mortgage foreclosure, if the sale of the collateral property does not fully cover the debt, the lender may obtain a deficiency judgment for the balance against the borrower (and, where applicable, under guaranties).

In this case:

The property’s fair market value was set at $125,000,
The bank bought it for $50,000, and
The court calculated a deficiency of $250,010.58, ultimately forming part of the bank’s claim against the estate.

4. Pledge Agreement and Guaranty

A guaranty is a promise by a third party (here, decedent) to be liable for another’s debt (here, the LLC’s) if the borrower defaults.
A pledge agreement is a grant of a security interest in personal property (here, the bank’s own stock) to secure repayment.

The Orange County action attempted to challenge how the bank enforced the pledge and whether it complied with contractual requirements like notice and redemption opportunities.

5. Law of the Case

This doctrine means that once a court has decided an issue, courts generally try not to revisit the same question in the same case. However:

It is not an absolute rule; and
It usually applies to the same specific issue, not distinct issues that arise later based on new facts or conduct.

In Ingber, capping fees in 2022 did not decide whether a later surcharge in 2023 would be appropriate in light of continued misconduct.

6. Laches

Laches is an equitable defense that bars a claim when:

There has been an unreasonable delay in asserting it; and
The delay has prejudiced the defendant.

The Orange County case was dismissed on laches after the estate failed to move it forward for over three years following a favorable appellate ruling. That dismissal had profound consequences for the estate’s ability to contest the bank’s claim and for the mootness of related arguments.

7. Collateral Estoppel

Collateral estoppel (issue preclusion) prevents a party from relitigating an issue that was:

Fully and fairly litigated; and
Necessarily decided in a prior proceeding;

But it applies only against parties (or their privies) who had a full chance to litigate the issue.

In Ingber v Martinez, the Second Department held decedent and his estate were not collaterally estopped by the foreclosure judgment because decedent had not been a party in that earlier action. That allowed certain fiduciary-duty and pledge-related claims to proceed—but the estate’s later inaction extinguished that opportunity.

8. Judicial Settlement of Accounting

Under SCPA article 22, a judicial settlement of an accounting is a proceeding in which the court:

Examines the executor’s accounts;
Approves or disapproves payments, fees, and claims;
Fixes commissions; and
May impose surcharges or other remedies to correct mismanagement.

The order in Ingber is precisely such a judicial settlement of the estate’s final account.

VI. Practical Implications and Future Impact

A. For Estate Fiduciaries and Counsel

Litigation is an estate asset/liability management issue, not a personal crusade. Fiduciaries must treat lawsuits and claims (both for and against the estate) as economic assets to be managed prudently, not vehicles for personal vindication.
Refusal to settle can be a breach of duty. Where a reasonable settlement offer would clearly benefit the estate, persistent rejection—especially without prosecuting the purportedly superior alternative—can constitute a breach of the duty of prudence and justify a personal surcharge.
Fee maximization at the expense of estate value is perilous. Courts will scrutinize situations where legal fees threaten to consume or exceed the estate, especially when beneficiaries include the lawyer–fiduciary.
Compliance with court orders is essential. Disregarding accounting deadlines, sale directives, or warnings about future sanctions is not merely procedural sloppiness; it can be substantive fiduciary misconduct.
Conflicts when fiduciary is also counsel. This case highlights the heightened risk for attorney–executors who are also beneficiaries: courts may take a hard look at whether litigation decisions are driven by the estate’s interests or by the lawyer’s own financial and emotional interests.

B. For Creditors and Financial Institutions

Deficiency judgments remain robust claims against estates. The case reaffirms that such judgments, once validly obtained, are not easily undermined in probate proceedings, especially when prior collateral attacks have failed.
Court willingness to protect creditors from wasteful administration. The personal surcharge imposed here effectively protects the creditor from the consequences of the fiduciary’s strategic mismanagement, signaling that Surrogate’s Courts will not allow executors to “litigate into insolvency” at a creditor’s expense.

C. For Surrogate’s Courts and Future Litigation

Affirmation of broad equitable powers. The decision confirms Surrogate’s authority to:
- Cap legal fees;
- Order sales of assets;
- Warn of potential surcharges; and
- Impose surcharges tailored to restore estate value lost through imprudence.
Template for handling parallel litigation. The opinion models a careful approach to concurrent civil litigation:
- Recognizing its potential upside for the estate, but
- Insisting that it be actively and reasonably pursued, and
- Declining to indefinitely suspend or distort estate accounting on speculative litigation outcomes—particularly when the fiduciary fails to prosecute.
Encouragement of early, realistic assessment. Executors are put on notice that courts expect an honest cost–benefit evaluation of litigation and that stubbornly pursuing low‑value or dormant claims in the face of clear settlement opportunities can lead to personal financial liability.

VII. Conclusion

Matter of Estate of Ingber is a robust reaffirmation and subtle extension of New York’s fiduciary law in the estate context. It clarifies that:

The duty of prudence and loyalty encompasses litigation strategy and settlement decisions, not just investment or record‑keeping;
Surrogates may impose a personal surcharge on fiduciaries measured by the lost value of forgone reasonable settlements and other imprudent decisions;
The law of the case doctrine does not freeze a Surrogate’s ability to respond to ongoing or later‑manifested misconduct;
Attempts to use Surrogate’s Court as a vehicle for collateral attacks on existing money judgments, without actually prosecuting the purportedly offsetting litigation, will fail; and
Courts will protect both beneficiaries and creditors from estate administration strategies that unduly enrich fiduciaries or consume the estate in avoidable fees and delays.

For practitioners, the decision is a cautionary tale: litigation in estate administration must be undertaken with cold‑eyed economic judgment. Failing to accept a rational settlement, ignoring court warnings, and allowing parallel litigation to languish can result not only in the loss of a hoped‑for recovery, but in personal financial liability for the fiduciary who orchestrated that course.

Surcharging Estate Counsel for Wasteful Litigation Strategy: Commentary on Matter of Estate of Ingber, 2025 NY Slip Op 06935