Kaplan and Another v Leibbrandt and Another (Civil Case No. 82 of 1941 consolidated with Civil Case .No. 84' of 1941,) [1942] EACA 9 (1 January 1942)

## ORIGINAL CIVIL

#### BEFORE HAYDEN. J.

# Civil Case No. 82 of 1941 consolidated with Civil Case No. 84 of 1941. In the matter of Rules of Court (Rule 2 of 1916)

' and

In the matter of Taxation of $a'$ Bill of Costs between Advocates and Clients (In the matter of Probate and Administration Cause No. 59 of 1938 re JOHN LEIBBRANDT, Deceased)

and

## RALSTON & KAPLAN and KAPLAN & STRATTON. Advocates

$and$

### J. B. LEIBBRANDT and L. KAPLAN as Executors<sup>1</sup> and Trustees of the Estate of JOHN LEIBBRANDT, Deceased.

#### Costs of Solicitor Trustee.

In the absence of a power to charge contained in the instrument creating the trust a Solicitor Trustee acting for himself and a co-trustee cannot charge any profit costs for the administration of the trust estate out of Court.

Observations on the propriety of inserting a clause in a will entitling a Solicitor Trustee to charge such costs.

Slade for applicant.

Shapley for Mrs. Leibbrandt the tenant for life.

ORDER (19-3-42).—The learned Registrar disallowed certain items in two bills of costs of Messrs Ralston & Kaplan and Kaplan & Stratton filed in the above matters, his reason for so doing is stated as follows:—

"I disallow these items as they all deal with his co-executor and further in view of the fact that under the will of deceased Mr. Kaplan got a legacy in the following words, 'I bequeath unto my Trustee, Lazarus Kaplan in the event of his proving this my will a commission of one hundred pounds $(£100)$ '."

Messrs. Kaplan & Stratton have applied to revise the decision of the Registrar on the ground that these items were correctly charged.

A solicitor trustee acting for himself and co-trustee (in the absence of a power to charge contained in the instrument creating the trust) cannot charge any profit costs for the administration of the trust estate out of Court (Lincoln $v$ . Windsor 68 E. R. 456). Clause 5 of deceased's will reads: $-$

"I declare that any trustee being a solicitor or other person engaged in any profession or business may be so employed or act and shall be entitled to charge and be paid all professional or other charges for any business or acts done by him or his firm in connexion with the trusts hereof including acts which a trustee could have done personally."

This clause immediately follows clause 4 of the will which is in the terms set out by the Registrar as above. In re Fish Bennett v. Bennett (1893) 2 Ch. 413 the testator appointed his nephew Samuel Bennett, and his solicitor. Herbert Clifford Gosnell, executors and trustees, and bequeathed to Gosnell, if he should accept the offices of trustee and executor, the sum of £200. The will in that case contained the following clause:-

"And I declare that the said H. C. Gosnell, and every other person to be hereafter appointed a trustee of my will who may be a solicitor and professionally employed in matters relating to the trusts of my will, shall be entitled, and is hereby authorized to retain and receive out of the trust premises, his usual professional costs and charges, as well by way of remuneration for business transacted by him or his partner or partners personally, or by his or their clerks or agents (including all business of whatever kind not strictly professional, but which might have been performed, or would necessarily have been performed in person by a trustee not being a solicitor), as costs and charges out of pocket in the same manner as if the said H. C. Gosnell, and every other such person as aforesaid, had not been a trustee or trustees hereof, but had been employed and retained by the trustees hereof as solicitor in the matter of the trusts."

It was held that Gosnell, although a legacy was given to him in his capacity of trustee, was entitled to charge for his trouble as well as to make professional charges for business done by him as solicitor. I would cite the following extract from the judgment of Lindley, L. J. on pages 419-420:-

"I pass on to another question, which is, as to the charges which he is<br>entitled to make against the estate. Let us consider what the position was. Mr. Fischer has argued that, notwithstanding the clause in the will, Mr. Gosnell has no right to charge for his trouble as a trustee as distinct from his services as a solicitor. He said, 'You have, indeed, in this will, Mr. Wolstenholme's form, which is carefully worded in order to enable the solicitor trustee to charge for his trouble; but then you have a legacy to this gentleman of $£200$ in addition; and when you take that legacy and the form together, it is quite obvious that what the testator meant was that Mr. Gosnell should have £200 for his trouble in matters which were not solicitor's work. and that he should be at liberty to charge for his professional costs.' But the will does not say that. Mr. Gosnell may have fairly enough said, 'I will not accept the trusts of this will except upon the terms that I am to have my £200, and also payment for my trouble'; and when you come to look at the will, it is impossible to say that he is not justified in adopting that view, because the clause which enables the trustee to charge for his trouble, as well as for his professional costs as a solicitor, is not confined to Mr. Gosnell but applies to any trustee who is a solicitor, therefore, it appears to me that the construction put by Mr. Gosnell and his advisers upon this will is the right one, and that he is entitled to charge, not only for his professional services, but for his trouble as a trustee, and also to have his legacy."

I also quote the following passage from the judgment of Kay, L. J., at page $425:$

"I think that the meaning and intention of the clause is to give the solicitor trustee power not only to charge for work which is the proper work of a solicitor done for a client, but also to charge for work which he would be bound to do as trustee or which he might do as trustee, and which would not properly be solicitor's work, as though it were professional work. That, I think, is the meaning of the clause, and, therefore, I think that in makingcharges of that kind against the estate, assuming them to be fair and honest charges. Mr. Herbert Gosnell was not doing more than the testator empowered him to do."

I consider that clause 5 of testator's will in the present case is, although in an abbreviated form, materially the same as that in re Fish (supra) and is distinguishable from the clause in *Clarkson v. Robinson* (1900) 2 Ch. 722 in that in the latter case there were no such words as "including acts which a trustee could have done personally".

Mr. Shapley cited the case of *Chalinder v. Herington* (1907) 1 Ch. 58, submitting that the clause in the testator's will in that case was very similar to and perhaps wider than the clause in the present case. The clause in that case read: —

"I direct that my executor and trustee Edward Chalinder shall be the solicitor to my trust property and shall be allowed all professional and other charges for his time and trouble notwithstanding his being such executor and trustee."

In that case it was held that the clause did not authorize the solicitor trustee to charge for work which was not professional work, although it was such work as he might have charged for against a client who was not a trustee. In distinguishing that case from in re Fish (supra) Warrington, J. said at page 63:-

"In re Fish, where the charges were also allowed, the clause in the will contained those words which seem to me to be all-important words 'Including all business of whatever kind not strictly professional, but which might have been performed, or would necessarily have been performed, in person by a trustee not being a solicitor.' It seems to me that in order to enable a solicitor trustee to obtain payment for work for which an ordinary trustee could neither be paid directly nor be allowed payments made to a solicitor, there must be words in the will which show that was the testator's intention.

I consider that the clause in the will under consideration in the present case shows such an intention as to hold otherwise would be to give no effect to the words "including acts which a trustee could have done personally". In my view of the will the costs properly incurred which Mr. Kaplan is to be allowed are not to be limited to professional costs, but are to include other charges properly incurred.

As to the propriety of inserting such a clause in a will as is found in the present case I would respectfully cite with approval the following extract from the judgment of Kay, J. in re Chapple, Newton v. Chapman (1884) 27 Ch. 584 at page 587:-

"I must say, however, that the form to which I have just referred is in my opinion one which no solicitor ought to put in its entirety into a will drawn by himself, unless the testator has expressly instructed him to insert those very words,

and also to a passage from the judgment of the same Judge, then Lord Justice, in re Fish (supra) at page $425:$

"But I wish to say on my own behalf that when a solicitor trustee himself prepares a document containing a clause of that kind in his own favour, he must not be surprised if, when the matter comes before the Court, the Court is inclined to watch very jealously indeed his conduct as solicitor and trustee under the clause."

I must refer the matter back to the learned Registrar in respect of the items which he has disallowed and which are the subject matter of this application to review. his taxation, having regard to my opinion that non-professional charges properly incurred may be allowed. I, of course, express no opinion as to the particular items.

Each party to have costs of application out of the estate.