CONLEY v. WAITE

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Docket Number

Docket No. 9018.

Attorney(S)

Lynden Bowring for Appellant. Lobdell Watt for Respondent.

Judges

NOURSE, P.J.

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Smart Summary

Factual and Procedural Background

The plaintiff, Charmion Conley, sued to quiet title to a 3/24th undivided beneficial interest in certain real property held by defendant L.K. Small as trustee under a trust agreement. The trustee was joined as a party defendant, though the reason for his joinder is unclear. The trustee denied the plaintiff's claim of title and asserted his right to act as trustee under the trust agreement but did not claim any beneficial interest in the property. Defendant Effie C. Waite abandoned her defense and stipulated to judgment in favor of the plaintiff. The trustee also stipulated to judgment but sought an allowance of counsel fees for defending the action. The trial court entered judgment for the plaintiff as prayed and awarded the trustee $150 in counsel fees, which was made a lien on the plaintiff's interest in the property. The plaintiff appealed the portion of the judgment awarding counsel fees to the trustee.

Legal Issues Presented

Whether a trustee is entitled to reimbursement of attorney's fees incurred in defending against a suit brought by a beneficiary claiming an interest in the trust property.
Whether the trustee's claim for counsel fees in this case was reasonable and properly awarded as a lien on the plaintiff's interest in the property.

Arguments of the Parties

The opinion does not contain a detailed account of the parties' legal arguments.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Mitau v. Roddan, 149 Cal. 1, 16 (84 P. 145, 6 L.R.A. (N.S.) 275)	A trustee is not entitled to reimbursement of attorney's fees for litigation he has unnecessarily or unwarrantedly initiated.	Referenced to clarify that a trustee cannot recover fees for unwarranted litigation initiated by himself.
Estate of Gartenlaub, 185 Cal. 648, 654 (198 P. 209, 16 A.L.R. 520)	Supports the principle that trustees are entitled to reimbursement of proper expenses incurred in trust performance.	Used to affirm the trustee’s right to counsel fees when defending against unfounded suits brought by beneficiaries.
39 Cyc., p. 480; Perry on Trusts, sec. 903a	Attorney's fees may be charged against the interest of a party causing litigation when a trustee defends an unfounded suit by a beneficiary.	Applied to justify awarding counsel fees to the trustee as a lien on the plaintiff’s interest in the trust property.

Court's Reasoning and Analysis

The court explained that a trustee is entitled to reimbursement for all expenses properly incurred in performing the trust, including attorney's fees when defending against unfounded litigation brought by a beneficiary. The trustee here did not claim any beneficial interest but was joined as a defendant and entitled to counsel to make an appearance. Although the litigation essentially involved conflicting claims between two beneficiaries, the trustee's participation was justified, and the trial court's allowance of $150 for counsel fees was not unreasonable based on the record. Therefore, the court affirmed the judgment awarding the trustee counsel fees as a lien on the plaintiff’s interest.

Holding and Implications

The judgment awarding the trustee $150 in counsel fees as a lien on the plaintiff's interest in the property was affirmed.

This decision confirms that trustees defending against beneficiary litigation may recover reasonable attorney's fees as trust expenses chargeable against the interests of the party causing the litigation. No new precedent was established; the ruling applied existing principles to the facts at hand, resulting in a direct effect on the parties by upholding the fee award.

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CHARMION CONLEY, Appellant, v. EFFIE C. WAITE, as Administratrix, etc., et al., Defendants; L.K. SMALL, Respondent.

NOURSE, P.J.

The plaintiff sued to quiet title to a 3/24th undivided beneficial interest in certain real property held by defendant Small as trustee under a trust agreement which was pleaded in full in the complaint. The trustee was joined as a party defendant, but for what reason it does not appear. The trustee filed an answer denying, on lack of information or belief, plaintiff's claim of title, and pleading, as was done in the complaint, the declaration of trust and his right to act as trustee under it. He did not, however, make any claim to the beneficial interests in the real property which were in issue. Before the cause was tried the defendant Waite abandoned her defense and stipulated that plaintiff might take judgment as prayed for. The trustee made the same stipulation, but claimed the right to an allowance of counsel fees for appearing and defending the action. Judgment was accordingly entered for plaintiff as prayed in her complaint, but the trustee was awarded the sum of $150 for counsel fees, which was made a lien on plaintiff's interest in the property. The plaintiff has appealed from the portion of the judgment covering these fees.

[1] The rule of law applicable to the question is that a trustee is entitled to reimbursement of all expenses actually and properly incurred by him in the performance of his trust (sec. 2273, Civ. Code); that he is not entitled to reimbursement of attorney's fees paid out in litigation which he has inaugurated unnecessarily or without warrant ( Mitau v. Roddan, 149 Cal. 1, 16 [ 84 P. 145, 6 L.R.A. (N.S.) 275]; Estate of Gartenlaub, 185 Cal. 648, 654 [ 198 P. 209, 16 A.L.R. 520]; 39 Cyc., p. 480); but, that when an unfounded suit is brought against him by the cestui que trust, attorney's fees may be allowed him in defending the action and may be made a charge against the interest in the estate of the party causing the litigation. (39 Cyc., p. 480; Perry on Trusts, sec. 903a.)

[2] The litigation here was really between two individuals claiming conflicting interests as beneficiaries of the trust estate. There does not appear to have been any reason for the joinder of the trustee as a party defendant. However, he was joined and was entitled to the benefit of counsel in making his appearance. The trial court allowed the sum of $150 and we cannot say on the record before us that such sum was unreasonable.

The judgment is affirmed.

Sturtevant, J., and Spence, J., concurred.