The opinion
Martin, P. J. (dissenting).
Claude C. Pinney died on June 27, 1929, leaving a last will and testament under which he gave all his *76 property outright to his wife, Katherine C. Pinney, and named the Brooklyn Trust Company and Charles H. George as executors. The principal asset of his estate was a seat on the New York Stock Exchange. The will was not admitted to probate until October 9, 1929. Meantime the Brooklyn Trust Company was appointed temporary administrator. Although the temporary administrator, as such, could have sold the Stock Exchange seat, it did not do so, and the seat came into the control of the executors. The will contains the following direction:
“ Third. I authorize and direct my Executors to sell my membership in the New York Stock Exchange as promptly as possible after my decease and to pay the Ten thousand dollar gratuity fund attached to said membership to my wife Katherine C. Pinney.”
The direction to sell “ as promptly as possible ” has not been complied with. The seat has not been sold. The temporary administrator and the executors named in the will filed an accounting. The widow filed objections thereto. The testimony in this proceeding was taken before a referee who absolved the executors. The decree of the surrogate settling the account has dismissed the objections to the account of the temporary administrator and has surcharged the executors for their failure to sell the seat within sixty days after the date of their qualifications. From that decree both parties have taken an appeal.
The surrogate properly dismissed the objections to the account of the temporary administrator. The temporary administrator had power to sell, but it was not its duty to do so. The relatively slight increase in the price of seats during the period of the temporary administration in itself is insufficient to justify a surcharge.
The main issue on this appeal is: May the executors be surcharged for their failure to sell the Stock Exchange seat? The executors maintain that the widow is estopped from raising any question in connection with the failure to sell the seat because what was done was encouraged and affirmatively directed by her; that her instructions on the subject were that they should rely on the advice and suggestions of her business adviser, Harold Strong; that they have followed these instructions, and she should not now be allowed to complain.
After the death of the testator, Mrs. Pinney consulted the law firm of Beekman, Bogue & Clark, and they represented her in connection with the temporary administration. This firm was retained by the executors. A labored effort has been made to make it appear that they were attorneys for Mrs. Pinney. The fact is that they were attorneys for the executors throughout the administration of the estate, have been their attorneys in the filing of the *77 accounting, on the trial in this proceeding, and on this appeal. The record is clear that they realized that they were, in reality, attorneys for, and their professional obligation was to the executors, no matter how friendly they may have been toward the beneficiary.
Before the will was admitted to probate and while the estate was still in the hands of the temporary administrator, Mrs. Pinney left New York to go to California. Prior to her departure, in connection with a loan which she had obtained from the Brooklyn Trust Company, she sent a letter to the trust company inclosing a power of attorney which she had executed in favor of Ralph S. Wolcott, William L. Bainton and Leslie B. Soper, of the firm of Beekman, Bogue & Clark. This power of attorney authorized the named individuals, among other things, to settle, adjust or compromise any claims which she might have as sole residuary legatee, to receive any money, securities or property and receipt for the same and to deliver title in any manner with respect to her interest in the estate; to consent to the judicial settlement of the executors’ accounts and execute waivers of citations. This power of attorney in no way restricted the attorneys in fact and did not condition their action upon approval by anyone. Mrs. Pinney was not in New York again until January, 1930. She visited New York thereafter only at intervals.
Following the issuance of letters Testamentary to the executors steps were taken immediately looking toward a sale of the Stock Exchange seat. It could be sold only in accordance with the rules and regulations of the Exchange. Matthew M. Campbell, a member of the firm of attorneys for the executors, went to see the secretary of the Stock Exchange about the time letters testamentary were issued and took up with him the procedure for the selling of the seat and the then market prices of seats. Campbell was informed by the secretary that the last sale price was $498,000 and the last asked price was $496,000. Campbell reported this to Ralph S. Wolcott, another member of the firm. Wolcott testified that on the day the -will was probated, or the day before, he discussed the offering of the seat with Strong and said he wanted to ascertain his idea as to price; that be advised Strong that the last sale was for $485,000, and that he, Wolcott, had discussed the question of the sale with Mr. George by telephone. Wolcott testified that Strong suggested the offer go in at $496,000. George testified that after talking with Mr. Wolcott and Mr. Strong it was decided to put in the seat at $496,000. George’s testimony is not very helpful because he gives conclusions and not what was said by anyone. Strong testified that either Wolcott or George called him on the phone and said: “ We have decided to put in the *78 seat at $496,000.” It was desired, to know what Strong thought of it. Strong denies that he suggested a price of $496,000. Under date of October 8, 1929, the attorneys wrote the trust company, in part, as follows: “ We enclose herewith a form of letter which you will please sign addressed to the Secretary of the Stock Exchange authorizing the sale of Mr. Pinney’s membership. The last sale, we are informed, was for the price of $498,000, and membership is being offered at the present time for an asked price of $496,000. We suggest that a sale of the membership owned by Mr. Pinney be authorized at $496,000, and if at a later date we decide to decrease or increase this price, we can do so. Please write a letter following the enclosed form on your own stationery and send it to us. We shall then transmit it to the Secretary, Mr. Ashbel Green, with a certificate of letters testamentary and New York waiver.”
The blotter sheets of the office of the attorneys for the executors carry the following entry under date of October eleventh: “ Oct. 11 MMC. confers with E.SW in re sale of Stock Exchange seat and price for same. It is agreed that $496,000 is the proper price. B.SW. telephones Mr. Strong re this, also Mr. George, and this price meets with their approval.”
This entry corroborates Strong’s testimony. As we read the record the price of $496,000 was decided upon in the office of the attorneys for the executors and, as the blotter entry indicates, Strong approved of it.
In the face of this testimony it is idle to say there could not have been an advantageous sale within a reasonable time.
The letter offering the seat for sale at $496,000 was not delivered to the Secretary of the Stock Exchange until October fifteenth. Seats were being sold almost daily and no one made any inquiry as to whether there had been any change in prices between the first consultation with the secretary of the Exchange and the time when the letter fixing the price was delivered to him. The fact is that there was a downward fluctuation.
On October 28, 1929, the historic collapse of the stock market took place. On October twenty-ninth Campbell consulted the secretary of the Stock Exchange. The latter advised taking no action toward selling the seat at that time, as he believed that, after the condition of the market had settled and normal trading was resumed, memberships would be as valuable as ever. Campbell testified that the next day he talked to Strong and advised him of his conversation with the secretary of the Exchange, and Strong said he was going to consider the advisability of lowering the offered price to $480,000. The blotter entry covering Campbell’s conversation with Strong states: “ MMC talks to Mr. Strong of Hemphill, *79 Noyes re present status of proceedings to sell Stock Exchange seat. Mr. Strong expressed opinion that we should lower our authorized price to $480,000.”
Under date of November 1,1929, Campbell wrote to Mrs. Pinney reporting his talk with the secretary of the Stock Exchange, but making no mention of Strong’s advice to lower the price of $480,000. George, the individual executor, had consulted with others regarding the situation. On November 12, 1929, a letter was sent to the secretary of the Stock Exchange authorizing the sale of the seat at $475,000. George’s testimony with reference to the fixing of the new price of $475,000 indicates that this was done -without consultation with Strong.
After November 12, 1929, no change was made with reference to the offered price until April, 1930. At the end of March the attorneys for the executors, wrote to Mrs. Pinney urging her to indicate a price at which the seat should be sold. Under date of March 31, 1930, Mrs. Pinney wrote Campbell a letter in which she said: “ I had a letter from Mr. Strong in regard to the seat. I am agreeable to his suggestion $440,000 to $450,000, whatever Mr. Strong says will be alright with me.” This letter was received by the attorneys for the executors on April 3, 1930. At that time there was still on file with the Exchange the second offering of the seat at $475,000. After receiving Mrs. Pinney’s letter the attorneys telephoned to the Stock Exchange and directed withdrawal of the $475,000 offer. The record indicates that this was done without consultation with Strong. In fact, it was done without consultation with the individual executor. On April 9, 1930, the seat was offered for sale at $490,000. It is the claim of the executors that this price was fixed by Strong. The president of the trust company testified that on April ninth he sent for the individual executor and told him that in his opinion the seat should be sold then and there at prevailing prices. George testified that he declined to authorize a sale at the then market price of $467,000. His testimony is that he suggested that Strong’s advice be followed. Wolcott phoned Strong and as a result of this telephone conversation between Wolcott and Strong, Strong on Wolcott’s request wrote the following letter:
“ Confirming telephone conversation of today, I had a talk with Mr. George, who is sailing on Friday for Europe, to return sometime in May. He said that he was writing a letter to the Brooklyn Trust Company, stating that anything which I cared to do for Mrs. Pinney or for the estate had his entire approval. He also agreed with me that we should offer the seat for sale at $490,000. I understand that you have taken up this matter today with the Stock Exchange.
*80 “ Looking forward to talking the whole matter over with you in the next few days, I am.”
It is necessary to consider the sequence of events leading up to the fixing of the price of $490,000. On April 5, 1930, an officer of the trust department of the trust company sent a memorandum to the president of the trust company reporting the fact that on April 4, 1930, a sale of a seat at $467,000 had been reported in an evening paper. The memorandum drew attention to the fact that the inventory value of the seat was only $395,000. On April 9, 1930, the president of the trust company and the individual executor had a conference. At the conference between the president of the trust company and the individual executor no price was fixed. George, the individual executor, before calling upon the president of the trust company, had made no inquiry as to the status of the market for seats. After leaving the trust company George testified he consulted with Strong, but before consulting with Strong he called the Stock Exchange and talked with the secretary, and he also talked with the attorneys for the executors. George discussed with the secretary of the Exchange the price of $490,000. He also talked to Strong and told him what he had learned from the secretary of the Stock Exchange. He testified that he told Strong that the lowest price at which the seat was being offered was $490,000. On the same day George wrote a letter to the trust company reading as follows:
“ Since our conversation regarding the Pinney Estate and the Stock Exchange seat, I have discussed the sale of the Stock Exchange seat with Mr. Harold Strong, of Hemphill, Noyes & Company, and also with Mr. Ashbel Green, Secretary of the New York Stock Exchange. As a result the seat has been offered for sale at $490,000. There are no other seats offered at this price or at any lower price. This arrangement will be agreeable to Mrs. Pinney, with whom Mr. Strong is in communication. * * *
Should they decide to change the price at which the seat is offered, this will be agreeable to me, and will have my approval on my return in the middle of May. In the event that any other questions come up with regard to the Estate during my absence, I will approve of any action taken by Mr. Strong in the matter.
“ I am sending a copy of this letter to Mr. Strong.”
Strong testified that George came to him on April ninth and said he had a meeting with the secretary of the Exchange and that the secretary thought that the seat could be sold for $490,000, and George wanted to put the seat in at $490,000, and Strong agreed with him. The record indicates that it was George who fixed the price of the April ninth offer at $490,000, and that Strong acquiesced in that.
*81 George went to Europe after the April ninth price fixing. After his return in May, 1930, George had a conference in New York with Mrs. Pinney. He testified that he suggested that the seat be sold at prevailing prices. Mrs. Pinney agreed to this, and there is no record of any reservation or qualification.
On June 4,1930, the attorneys for the executors received an offer for the seat made by a representative of the Stock Exchange, Mr. Hulsaver. Hulsaver testified that on June 4, 1930, he called the attorneys for the executors on the telephone and spoke with Campbell and told him that he thought he could sell the Pinney seat at $470,000, if they wanted to sell at that price, and, according to Hulsaver, Campbell said they would have to get in touch with Mrs. Pinney, and Mrs. Pinney was not in town, to which Hulsaver replied that he had to know right away because he did not want to lose the buyer, and he could not hold it up if it took two or three days. This offer to the attorneys for the executors was not communicated by them to any one.
On June 14, 1930, Campbell discussed with George a reduction in the offering price of the seat. As a result of this discussion, George advised Campbell to reduce the figure to $470,000. The testimony is that this was done without any discussion with Strong. There is a letter from Campbell to the trust company under date of June 16, 1930, which states: “ Upon the advice of Mr. George, your co-executor, and Mr. Harold Strong, Mrs. Pinney’s financial adviser, we havé instructed the Secretary of the Stock Exchange to reduce the price at which the Stock Exchange membership is offered from $490,000 to $470,000. Kindly sign the enclosed letter giving written confirmation to these instructions and send it directly to the Secretary of the Stock Exchange with a conformed copy to us.”
The statement contained therein that the price had been reduced upon the advice of George and Strong, Mrs. Pinney’s financial adviser, is not correct, because Strong was not in the city at the time, being away on a fishing trip between May twenty-ninth and June seventeenth or June eighteenth and knew nothing about the change until his return. The price was lowered on George’s direction and not as a result of any consultation with Strong. Upon returning to the city Strong expressed an opinion that the price should be reduced to $450,000 or $445,000. George took the matter up with Campbell, and the price was lowered to $450,000. George testified that this price of $450,000 was fixed independently of Strong. This offering price of $450,000 was given to the office of the secretary of the Stock Exchange on June 19, 1930, and that price remained in force up to the date of the accounting.
*82 The record indicates that in the Spring of 1930 the executors began to manifest anxiety about how they had discharged their duties, and they developed a campaign to free themselves from criticism, which culminated in their obtaining the letter of November 7, 1930, which has been held by the surrogate to be a direct estoppel.
The conduct of the executors indicates that they did not believe they were obliged to consult Strong and follow his advice and suggestions. In fact, they sought advice and suggestions elsewhere, decided for themselves, and, at times asked for approval by Strong. The first price was determined upon by the attorneys for the executors, and Strong was asked for his approval. The second price was fixed without his approval. The third price was fixed by the individual executor, and- Strong acquiesced in it. The fourth price was fixed without consultation with him, and the fifth and final price was fixed independently of him. In fixing the prices, Mrs. Pinney’s ideas, as expressed in her March thirty-first letter, were not followed out; her willingness, as expressed in May, to sell at the market, was not considered, and the June fourth opportunity to sell at $470,000 was permitted to pass without consultation with Strong or Mrs. Pinney.
Nor do we consider the expressed wish of Mrs. Pinney that Strong be consulted was any restriction or limitation on the free discharge of the duties of the executors. Strong had been a business associate of Mr. Pinney; he was a member of the firm where Mr. Pinney had had his office, and for which firm Mr. Pinney had executed orders on the Exchange. As the executors, in their brief, say: “ It was natural' that Mrs. Pinney should turn to Mr. Strong for advice.” The executors, in their brief, maintain that Mrs. Pinney imposed her will upon the executors by the use of an adviser as to the. time and price of the sale of the Stock Exchange seat. The record fails to establish any such imposition. But if the executors had allowed Strong to control the estate, they would have adopted him as their agent and would be responsible for his conduct. (Earle v. Earle, 93 N. Y. 104 .) In Perry on Trusts (7th ed. § 408) it is said: “ A trustee may delegate ministerial duties but if he delegates discretionary powers he becomes a guarantor and if a trust is of a discretionary nature, the trustee will be responsible for all the mischievous consequences of the delegation, and the exercise of the discretion will be absolutely void in the substitute. Nor can a discretionary trust be delegated to a cotrustee. (Crewe v. Dicken, 4 Ves. 97; Caldwell v. Graham, 115 Md. 122 ; 80 Atl. 839 .) ”
It is'urged that Mrs. Pinney should not now be heard to complain because of her acquiescence. What did she acquiesce in? Only a *83 price fixed by the executors on some occasion. Emphasis is placed on the letter written by her in December, 1929, in which she wrote that she, too, was in favor of holding for a better price. This was simply echoing sentiments of the executors. It is urged that her acquiescence is sufficient to support an estoppel.
In Pomeroy on Equity Jurisprudence (4th ed. § 804) “ equitable estoppel ” is defined as follows: “ Equitable estoppel is the effect of the voluntary conduct of a party whereby he is absolutely precluded, both at law and in equity, from asserting rights which might perhaps have otherwise existed, either of property, of contract, or of remedy, as against another person, who has in good faith relied upon such conduct, and has been led thereby to change his position for the worse, and who on his part acquires some corresponding right, either of property, of contract, or of remedy.”
In the following section (§ 805), covering the essential elements constituting an estoppel, it is said: “ 5. The conduct must be relied upon by the other party, and, thus relying, he must be led to act upon it. 6. He must in fact act upon it in such a manner as to change his position for the worse; in other words, he must so act that he would suffer a loss if he were compelled to surrender or forego or alter what he has done by reason of the first party being permitted to repudiate his conduct and to assert rights inconsistent with it.”
Can it be fairly said that the executors have been induced to act or refrain from acting upon anything Mrs. Pinney said or wrote? Our analysis of the record indicates that they did not feel bound by her instructions to look to Strong for advice and suggestion. They never took a positive position with reference to selling, and cannot now say that they were dissuaded from acting by either Mrs. Pinney or Strong. Nothing either of these said or did may be claimed to have misled the executors into improperly retaining the seat. An attempt was made on the part of the corporate executor to show that in April, 1930, it insisted upon the seat being sold. The record shows that the corporate executor was not very insistent and readily acquiesced in the unwillingness of the individual executor to sell at the market. Neither Strong nor Mrs. Pinney had anything to do with this. Down to the date when the executors obtained the letter from Mrs. Pinney, under which she became responsible for further delay, the executors could have insisted either upon selling or being relieved from the responsibility for the delay in selling. The difficulty in this case is due to the failure to take a definite stand on the part of those obligated to do so.
As we pointed out in Matter of Frame ( 245 App. Div. 675 ) there is no duty on the part of a beneficiary to demand that executors *84 discharge their duty. They are obligated by law to do so. What was the executors’ duty here? It was, independent of the directions contained in the will, to sell the seat with reasonable diligence.
In Matter of Hearns ( 214 N. Y. 426 ) there was a direction in the will that a sale of the decedent’s membership in the New York Stock Exchange be made “ as soon after my death as possible.” Speaking of this provision in its application to the unusual character of the estate asset, the surrogate, in his unreported opinion, said: “ From these authorities and with the utmost indulgence to the executors, it appears that an act to be done ' as soon as possible ’ is to be done within such time as shall be found as a matter of fact to be reasonable in view of all the circumstances surrounding the act to be required. Where the thing to be sold is a piece of intangible and unproductive property which is subject to fluctuation in value and dependent for its availability upon the will of an unincorporated association and other vicissitudes, and which further has a present market, the time in which it is to be sold cannot be more than sixty days after the duty of sale is assumed. * * * This was not an investment, and whatever it may be called, it is governed by the emphasized direction which names it and cannot come within the general authority.”
The Court of Appeals approved the surcharge for failure to sell within sixty days. In view of the complete knowledge of the situation which the corporate executor acquired during the period of the temporary administration, and the mandatory direction in the will, it is not unreasonable to hold that in this case, too, the seat should have been sold within sixty days after letters testamentary were issued.
During the trial evidence was offered to show that the executors had positive knowledge that the testator was most anxious to have the Stock Exchange seat sold immediately upon his death. Any evidence in addition to the will that brought home to the executors such intention of the testator was, we think, competent and should have been admitted solely for that purpose. It was shown that the written instructions of the testator in bis own handwriting delivered to Mr. Burdick, the attorney who drafted the will, stated “ 2nd: Sell my seat on N. Y. Stock Ex at once,” the words “ at once ” being the only words underlined in the entire letter of instructions. Although the letter itself was excluded, improperly we believe, the evidence admitted shows that this letter came into the possession of the Brooklyn Trust Company prior to July 5, 1929, and within a week after the testator’s death and was thereafter retained by the trust company. A photostatic copy of this letter of instructions *85 was on July 10, 1929, mailed by the trust company to Mr. George, the other executor.
There appears to be no doubt that this, in addition to the other testimony, emphatically and pointedly called the attention of the trust company and of the individual executor to the necessity of selling the Stock Exchange seat immediately.
The sale of a Stock Exchange membership is a relatively simple matter. The office of the secretary of the Exchange acts as intermediary and endeavors to assist members in the purchase and sale of seats. Prior to the crash at the end of October, 1929, seats were being sold without much difficulty and even following the collapse sales were being made. Diligence should have prompted the executors to keep in touch with current prices and adjust their price accordingly. Fixing the price in excess of the amount at which seats were being currently sold was unlikely to bring about a sale and was, in fact, a speculative effort to get something above the market. This certainly was not conducive to selling “ as promptly as possible.” Furthermore, the record indicates that for weeks at a time no interest whatever was taken in the condition of the seat market.
The administration of this estate created a situation free of any intricacy. There was no trust. The sole beneficiary was Mrs. Pinney, an adult. There were no infants involved. It was an estate of the simplest form, the administration of which could have been carried through without much difficulty by the widow. The only asset which might present an unusual problem was the Stock Exchange seat, an unproductive asset. Had the testator intended that his widow would have to solve the problem of its sale, it would have been an easy matter for him to have designated her as executrix, and thereby placed the responsibility on her. Instead he selected a friend and a corporate executor, no doubt having in mind, with reference to the latter that it afforded, at least a promise of rigid obedience to the will and that its resources and financial responsibility were a guarantee of fidelity to the trust. (Jessup-Redfield Surrogates’ Courts [3d ed.], § 506.) The testator was willing to have the net estate coming to his widow reduced by the amount of commissions (in this instance, a considerable sum) so that the sale would be promptly made by presumably competent executors. We find that both executors have failed in the discharge of their duties. The corporate executor would have it appear that it was depending upon the individual executor and also upon Strong. That should not reheve the corporate executor from carrying out a duty which it assumed. As we pointed out in Matter of Frame (supra): *86 “ Corporate executors and trustees should not act as such unless they intend to give proper attention to the duties required to properly administer an estate. It is their duty to protect those whose interests are intrusted to their care.”
In February, 1930, the corporate executor raised the question as to the power of Mrs. Pinney to direct the executors what to do, and we find them being advised by their attorneys that she had the right to regulate the price at which the seat could be sold. We know of no authority which gives to beneficiaries the right to dictate to executors. The lack of attention given by the executors to carrying out their trust leaves them open to suspicion that in this estate they were interested in little beyond the taking of commissions for acting as executors.
We agree with the surrogate that the letter of November 7, 1930, constitutes a direct estoppel against any claim for injuries by retention of the seat after that date, and that in fixing the amount of surcharge the executors are entitled to credit determined by the worth of the seat on that date.
We also agree that the executors are not entitled to commissions because of their negligence and maladministration of this estate.
The attempt to escape liability by asserting that the beneficiary or a third party who had no duty in the matter should be held responsible for the failure to obey a positive direction in a will made by a man who in making his will was familiar with the subject and knew that he was dealing with an unproductive asset, should not be permitted. If we do permit it a person’s will is of little value when executors wish to ignore its mandates.
The decree of the surrogate should be affirmed.
Cohn, J., concurs.
Decree reversed as indicated in opinion, and the report of the referee confirmed, with costs to the executors payable out of the estate, and the matter remitted to the Surrogate’s Court for further action in accordance with opinion. Settle order on notice. '