In re the Estate of Garfield 14 N.Y.2d 251

Bergan, J.

Decedent died May 21, 1952 leaving a widow and two young children. Letters testamentary were issued by the Surrogate of New York County to the widow July 2, 1953. The net value of the estate was $192,000. Shortly after the issuance of letters, the petitioners, a firm of lawyers, filed a claim for $50,445.15, a quarter of the net estate, for “ fees including disbursements, for legal professional services ” claimed to have been rendered testator during his lifetime. The testatrix rejected the claim and, almost six years later, claimants on June 30, 1959 filed a petition with the Surrogate for a compulsory accounting by the executrix.

In response to this petition the executrix filed an affidavit in which she advised the Surrogate that there were no claims pending against the estate other than this one; that she was the sole legatee under her husband’s will; that she had never made an accounting and there would be no necessity for one unless she were required by the Surrogate to do so “ on the basis of petitioner’s application”. The affidavit stated her objection to an accounting because of the unnecessary expense involved since the assets were sufficient to meet this claim if it were determined to be valid.

The affidavit stated: “ I do not admit the validity of the petitioner’s claim. However, I am perfectly willing to agree to a trial of that claim, provided all of my defenses against the claim and my other rights, both substantive and procedural, in relation thereto are preserved.” She then asked that the application for compulsory accounting be denied and that the Surrogate “direct a trial of all the issues involved in the disputed claim.”

This affidavit was served on January 19, 1960; it contained no demand for a jury trial. On March 11,1960 executrix served *256a duplicate copy of her affidavit on which there was noted “ Respondent Demands Trial by Jury”. Thereafter on the same day the Surrogate stated in open court he would ” deem ” the affidavit to be the executrix’ answer. At this court session the petitioners orally moved to vacate the demand for a jury trial on the ground testatrix was not entitled to a jury as a matter of right.

On September 15, 1960 the Surrogate decided petitioners’ motion addressed to the demand for a jury trial by holding that executrix had no right to a jury trial even as a matter of discretion and accordingly his order vacated the demand. The Appellate Division by a divided court affirmed this order, ruling that the executrix could not have a jury trial as a matter of right, but gave her leave “ to apply to the Surrogate for a trial by jury as a matter of discretion ”, the court being of opinion power to grant a trial by jury rested with the Surrogate.

We are of opinion the executrix had a right to trial by jury which should not have been denied. Petitioners’ claim is an action at law for work, labor and services, and the right to trial by jury in all such cases is preserved by the Constitution (art. I, § 2). No reported case has been cited in New York, and we have found none, where it has been held that an administrator or executor, making timely assertion of right, is deprived of a jury upon a claim based on a cause against him actionable at law.

It is useful to look closely at Matter of Boyle (242 N. Y. 342 [1926]) to see exactly what the court there had before it and what it decided, for this is a leading authority on the subject. It is cited in the prevailing and dissenting opinions at the Appellate Division and both sides rely on it in the arguments in this court.

A claim had there been made to an administrator for services and materials furnished the decedent. The claim was rejected, but claimant did nothing until the administrator filed his account and asked for judicial settlement. Claimant appeared on the accounting proceeding and asked that the validity of her claim be submitted to a jury. This application was granted; the order was affirmed by the Appellate Division, which certified to this court the question whether claimant was ‘ ‘ entitled as a matter of right to a trial by jury of her claim ” (supra, *257p. 344). This court reversed and answered the question in the negative.

The reason for the reversal was that the claimant, not having commenced an action within three months after the rejection of her claim, had waived the right to a jury trial under section 211 of the Surrogate’s Court Act. This was the question decided, and it has obviously no relevancy to the situation of the executrix in the case before us who had no other choice but to administer the estate in the Surrogate’s Court and had no access to any other tribunal for the adjudication at law of the claim which had been made against her. The effect of waiver, which was applied to the claimant in Boyle (supra) because the claimant could, within the statutory time, have sued the administrator in a law court where a jury trial would have been allowed as a matter of right, but chose not to do so, is not controlling in the case before us.

The “plain wording of the statute” in the opinion of McLaughlin, J. (p. 345) dictated the result. The decisive issue which controlled the opinion is in this paragraph (p. 345): “ It will be observed that provision is made in the statute that where a claim is rejected, an action may be brought in the ordinary way and a jury trial had, if the claimant shall within three months after rejection commence an action for the recovery of the amount of the claim against the executor or administrator, or if the debt is not due, then two months after the same becomes due. And, unless an action be brought within the time specified, then according to the plain wording of the statute the claimant and all persons claiming under him shall forever be barred from maintaining said action and in such case said claim shall be tried and determined upon the judicial settlement.’ ”

The court did not have before it for decision, and, of course, did not attempt to decide the right of the administrator to a jury trial. The opinion discussed some of the cases which had considered demands for jury trials made both by claimants and administrators, but there was no statement of disapproval of cases such as Matter of Beer (188 App. Div. 894) where a jury was directed at the request of the administratrix. The decision in Matter of Woodward (105 Misc. 446, affd. 188 App. Div. 888) was cited, but there the application of the executrix for a jury trial was denied by Surrogate Fowler *258for the ‘‘ wholly adequate reason ” that ‘‘ It comes too late ” (p. 450). Other cases cited, Matter of Stein (200 App. Div. 726) and Matter of Beare (122 Misc. 519, affd. 214 App. Div. 723) dealt with demands by claimants. The later decision in Matter of Raymond v. Estate of Davis (220 App. Div. 480) dealt with a claimant’s right to a jury trial and is based on Boyle (supra). Although there is language of generalization in Boyle, e.g., “ The statute gives an absolute right to a jury trial in a probate proceeding, but there is no such right as to a rejected claim” (p. 345), the effect of the decision must be kept within the area of the problem then before the court: a waiver of right to jury trial by a claimant who fails to pursue within the statutory time an action at law in which he would have been entitled to a jury.

The difference between a claimant who has a choice to pursue an action in law or to file a claim and an administrator who must, at the election of the claimant, either defend in the law action or before the Surrogate may in some respects be analogized to the difference between a plaintiff who chooses to join legal and equitable causes in a suit in equity and a defendant who is brought into equity and required, among other things, to defend there a law cause of action. It is held the plaintiff waives the right by joinder (Di Menna v. Cooper & Evans Co., 220 N. Y. 391), but that defendant does not (Wheelock v. Lee, 74 N. Y. 495).

Nor could the Legislature deprive a party who would have had a right to jury trial at common law of such right by authorizing a court of equity to take jurisdiction (People ex rel. Lemon v. Elmore, 256 N. Y. 489, 493; Hudson v. Caryl, 44 N. Y. 553).

No equitable principles govern the jurai relations between these claimants and the executrix. She has no matured fiduciary duty to them until they have succeeded in establishing their disputed law cause based on the claim that her husband owed them money for services (McCarthy & Co. v. Hill, 295 N. Y. 320).

Since the cause of action asserted by claimants is one for which a jury trial is preserved by the Constitution, the Legislature could not completely deprive the executrix of her right to jury trial in some forum, and the history of section 68 of the *259Surrogate’s Court Act makes it clear that the Legislature did not intend to deprive her of that right. Before 1914 the Surrogate’s Court had no jurisdiction, unless on consent of the parties, to try claims which would be triable as of right by a jury at common law, and before 1895 it had no jurisdiction whatever to try such disputed claims. An amendment in 1895 authorized their trial by consent (L. 1895, ch. 595; Code Civ. Pro., § 1822, the subject matter of which is now substantially covered by Surrogate’s Ct. Act, § 211).

A general revision of the code provisions dealing with procedure in Surrogate’s Court was enacted in 1914 (L. 1914, eh. 443). Provision was made for adjudication of claims before the Surrogate upon accounting without consent, but it is clear both from the language of the amendments as well as from the views of the revisers (Report of Commission to Revise Practice and Procedure in Surrogates’ Courts [1914]) that it was intended to preserve the existing right of jury trial in creditors’ claims arising on judicial settlement.

Heavy reliance is placed by claimants on the opinion in Matter of Beare (supra), but the point decided in that case was the right of an executor, who also was a claimant, to have a jury trial of his own claim against the estate. The decision is neither relevant nor controlling on the issue before us.

Respondents also suggest that even if executrix had a right to jury trial she waived it, since section 67 of the Surrogate’s Court Act provides that a right to trial by jury as to “ any issue of fact ’ ’ shall be deemed waived unless demanded in writing and served with the answer or objections. The affidavit filed by executrix in opposition to the petitioners’ motion for a compulsory accounting does not meet the specification of the kind of pleading—‘‘ answer or objections ” — described in section 67. The petitioners made no allegation of “fact” in their petition as to the basis of the claim. They stated merely that the petitioners were “ creditors ” of the testator and asked for an accounting.

Executrix was not asserting any issue of fact on the merits of the claimants ’ purported legal services. She was requesting, rather, that whatever issue might arise should be tried directly and simply without burdening the estate with the expenses of an accounting. The expression of her willingness to a trial *260of the claim if “ all of my defenses * * * are preserved ” could have no other meaning and certainly does not amount to a tender of any issue. Not until the Surrogate ruled that he “ deemed ” this an “ answer ” could it conceivably be treated by the litigants as either asserting or framing an issue of fact on the merits of the claim, and before this judicial construction had been announced the demand for a jury trial had been served in writing.

Besides this, the argument that there was a waiver comes too late in this court. It was not made to the Surrogate, and he was clearly of opinion that the demand was timely. It was asserted for the first time in the Appellate Division. That court entirely, and properly, disregarded it. And it ought not be assertable now (Wakeman v. Wilbur, 147 N. Y. 657; Sterrett v. Third Nat. Bank of Buffalo, 122 N. Y. 659; Burnside v. Matthews, 54 N. Y. 78; Barnes v. Perine, 12 N. Y. 18; Cohen and Karger, Powers of the New York Court of Appeals, ch. 17).

The order should be reversed and the certified question answered in the affirmative and the matter remitted to the Surrogates’ Court for further proceedings in accordance with this opinion, with costs to appellant against respondents.

Burke, J.

(dissenting). Although I feel that lack of timeliness in demanding a jury is an insuperable obstacle to appellant’s position, a more serious and pervasive error in the decision about to be handed down concerns the place of jury trials in accounting proceedings in the Surrogate’s Court.

Section 68 of the Surrogate’s Court Act, requiring jury trials in Surrogate’s Court proceedings when constitutionally necessary, was in no way intended to broaden the availability of such a right to encompass accounting proceedings in which juries had never been used. When the predecessor (Code Civ. Pro., § 2538) of the present section 68 was first enacted in 1914 it was intended to overcome the problem of multiple trials theretofore arising in probate proceedings (see opinion of Follett, J., in Bowen v. Sweeney, 89 Hun 359, affd. 154 N. Y. 780). As the revisers wrote in respect to this section: “This will prevent the multiplicity of trials which may now be had in probate proceedings and permit the surrogate to determine finally all the issues in respect to the validity of a will. ’ ’ (Report *261of Commission to Revise Practice and Procedure in Surrogates ’ Courts [1914], p. 1.)

The decision that the estate representative has a right to a jury trial as to claims submitted in the course of his accounting has been asserted only once since the Surrogate was given the power to adjudicate disputed claims against estates in 1914. In Matter of Beer (188 App. Div. 894, facts set forth in detail in Matter of Stein, 200 App. Div. 726) it was decided that an executor could demand a jury trial of a rejected claim as a matter of right. This case was relied upon by the respondent in the leading case of Matter of Boyle (242 N. Y. 342) and was rejected by name in this court’s opinion. I, therefore, cannot assent to the supposed distinction that the Boyle case is limited to creditors, the right of the estate representative to a jury trial remaining an open question. No case since Boyle has indicated that the Bench, the Bar and legal scholars have understood the decision to be so limited. For instance, in Matter of Raymond v. Estate of Davis (220 App. Div. 480, revd. 248 N. Y. 67) the Appellate Division set aside the verdict of a jury to which certain questions of fact were certified by the Surrogate at the demand of the administrator and the consent of the claimant. The Appellate Division held the verdict advisory only and made new findings of fact. Upon the appeal to this court, in which great attention was paid to various questions of jurisdiction and procedure, and the power of the Surrogate defined in very board terms, it was never suggested in the briefs or in the opinion of the court that the jury trial was the administrator’s right or that the Appellate Division acted improperly in treating it as advisory only. Every authority indicates that no one has a right to a trial by jury in an accounting proceeding in the Surrogate’s Court in which a rejected claim is litigated (11 Carmody-Wait, New York Practice, § 271, p. 210; Matter of Doherty, 155 Misc. 396; Matter of Ludlam, 5 Misc 2d 1068; Matter of Sullivan, 177 Misc. 570; Temporary State Comm, on Modernization, Revision and Simplification of the Law of Estates, Second Report to Governor and Legislature [N. Y. Legis. Doc, 1963, No. 19], p. 366). Indeed, among those denying the right to a jury trial in the broadest terms was Judge Heaton, noted expert on Surrogate’s practice and counsel to the 1914 Revisory Com*262mission. (Report, supra, title page; 1 Warren’s Heaton, Surrogates’ Courts, § 108, par. 2 [h]).

It is suggested that the estate representative may be analogized to a “ defendant who is brought into equity and required, among other things, to defend there a law cause of action.” It is not explained how this analogy applies to an executor or administrator who petitions for a voluntary accounting, in the course of which a claim is litigated. And if the supposed analogy cannot be so applied in such a case it is equally inapplicable to a compulsory accounting where the estate representative is merely required to do that which he ought to do voluntarily. In neither case is anyone ‘‘ brought into equity ”. By accepting his letters, an estate representative accepts the responsibilities of his office, prominent among which is the duty of accounting for assets that have come into his hands (Surrogate’s Ct. Act, §§ 40, 257, 257-a, 258). If an analogy is to be drawn along the line of actions in equity it ought to be to the doctrine that those who institute equitable proceedings consent thereby to trial by the court (Cogswell v. New York, N. H. & H. R. R. Co., 105 N. Y. 319; Di Menna v. Cooper & Evans Co., 220 N. Y. 391). An estate representative holds the assets of the estate in trust for creditors of the decedent (Rogers v. Rogers, 3 Wend. 503; Blood v. Kane, 130 N. Y. 514) who have the absolute right to require the representative to account. (Surrogate’s Ct. Act, § 259; Matter of Gill, 183 N. Y. 347.) And, by analogy to actions for accountings in other courts, the action is none the less properly in equity because the court must first determine the “ jurisdictional fact ” of the plaintiff’s status—here as a creditor, or in Misner v. Strong (181 N. Y. 163) as a co-owner.

The constitutional right to trial by jury extends to ‘ ‘ all cases in which it has heretofore been guaranteed by constitutional provision” (N. Y. Const., art. I, § 2). The majority would read the guarantee as engrafting the right to a jury trial on certain issues of fact in whatever form of action or proceeding such issue may arise. Thus, since the enforcibility of an attorney’s claim against an executor or administrator for services rendered the decedent was formerly actionable solely at law, it must forever be tried to a jury even though it may now arise in an accounting proceeding in the Surrogate’s Court. *263I do not understand the guarantee to have such an unusual and devastating effect on the conduct of judicial business in special courts whose procedures are not conducted according to the course of the common law. The right to jury trials is applicable to ‘ ‘ cases ’ ’ in which it had been historically used. “ Cases ”, in normal usage, refers to the whole of a litigation, the substantive issues and the procedure according to which they are tried. Therefore, it is only when the whole case, viewed in its procedural setting, corresponds to the sort of case tried to a jury at common law that the constitutional provision applies. The applicability of the constitutional guarantee of jury trial to proceedings in the Surrogate’s Court was discussed ably and at length by Surrogate Delehanty in Matter of Leary (175 Misc. 254, affd. 260 App. Div. 100, affd. 285 N. Y. 693). It was there pointed out that the 1938 Constitution guaranteed the right of trial by jury only to the extent to which it was required in cases prior to the 1894 Constitution. To quote briefly:

‘ ‘ The provision for jury trial in the Constitution adopted in 1894 assured jury trials only as that procedure was theretofore used. At that date jury trial in the Surrogate’s Court was a thing unknown. Its development has been a matter of slow growth in the court. The brief of petitioner, of course, contains no suggestion that any practice of jury trial in this type of proceeding then existed in the Surrogate’s Court. Since the proceeding is an appeal to equity there was no jury trial in any court. In a common-law court, an action for damages for conversion or an action in replevin might furnish relief. In the Surrogate’s Court only a proceeding to obtain a direction to the fiduciary was possible in 1894.

‘ ‘ All of the proceedings of this court are special proceedings. (Matter of Burrows [Prime], 283 N. Y. 540; Matter of Schoenewerg, 277 id. 424, 427.) The distinction is a governing one as the cited cases show. The presumption is that no jury trial of a special proceeding in this court is available to the parties unless specially provided by statute. (Matter of Pardee [1933], 239 App. Div. 876; Matter of Popek [1935], 157 Misc. 421, 423; and see Matter of Beare, 122 id. 519, affd. 214 App. Div. 723.) The first case just cited denied a jury trial in an application under section 231-a of the Surrogate’s Court Act. *264In the second, a jury trial was denied in an application under section 216 of the Surrogate’s Court Act. In each case the petitioner sought a decree directing payment of money only.” (175 Misc., p. 256; italics in text.)

Of course, analogies must serve where identity does not exist. Some procedural innovations unknown to the common law so substantially resemble the manner in which similar controversies were formerly resolved that the right to a jury trial is carried over. Where, for example, a device such as a declaratory judgment action is used to establish a debt, it serves merely as a shell into which the common-law action is placed and the right to a jury trial follows the action into its new procedural home (Simler v. Conner, 372 U. S. 221). Where, however, a claim formerly actionable only at law is brought by legislation (L. 1914, ch. 443) within a larger proceeding in the Surrogate’s Court, in which a great many other matters affecting a great many other people are litigable, the dominant character of the proceeding remains the same and the newly cognizable issue becomes just one of the many triable to the Surrogate.

The presentation and settlement of claims against those whose affairs, through death or insolvency, are thrown into a special tribunal constituted specially for that purpose are plainly special cases not amenable to simple distinctions as to whether the nature of the issue or the nature of the proceeding should control the right to a jury trial. In the closely analogous case of claims presented in a bankruptcy proceeding, the United States Supreme Court long ago said: “So, in cases of bankruptcy, many incidental questions arise in the course of administering the bankrupt estate, which would ordinarily be pure cases at law, and in respect of their facts triable by jury, but, as belonging to the bankruptcy proceedings, they become cases over which the bankruptcy court, which acts as a court of equity, exercises exclusive control. Thus a claim of debt or damages against the bankrupt is investigated by chancery methods.” (Barton v. Barbour, 104 U. S. 126, 134.)

The fact that in this case the issues were narrowed by consent to dispense with all of the incidents of an accounting, saving only the validity of the claim, cannot operate to change the nature of the proceeding or the procedural rights of the parties. *265If the proceeding, as it comes into court, properly invokes the power of equity to vindicate a claim (here to an accounting) historically cognizable in equity, then no right to a jury trial exists. (Van Rensselaer v. Van Rensselaer, 113 N. Y. 207, 214.) This differs completely from a case in which no right to an accounting is properly made out in the pleadings. There, of course, the defendant’s demand for a jury trial must be honored. (McCarthy & Co. v. Hill, 295 N. Y. 320.)

Indeed, the procedure informally followed in this case corresponds exactly to that specified in newly enacted section 211-b of the Surrogate’s Court Act (L. 1963, ch. 488, § 5), under which the Surrogate may determine the validity of a claim in advance of a formal accounting. The language of the section * leaves no doubt that the Surrogate, not a jury, is to pass upon the claim.

To hold the procedure authorized by this section unconstitutional in the face of the determination made in the 1938 Constitution not to expand the constitutional guarantee but to leave the Legislature free to experiment in various proceedings is, in my view, wholly unwarranted. The order appealed from should be affirmed and the question certified answered in the negative.

Chief Judge Desmond

(concurring with Judge Burke). Finding no precedent for a holding that an executor defending in Surrogate’s Court against an alleged creditor’s claim has a right to a jury trial, I concur in Judge Burke’s opinion.

There is, besides, another reason for affirmance. On the undisputed facts and even if we assume that the executrix had a right to a jury trial, she as a matter of law waived it. Section 67 of the Surrogate’s Court Act says that, where there is a right to trial by jury on an issue of fact, the jury is ‘ ‘ deemed waived ’ ’ unless demanded in a writing which in the case of a respondent must be ‘ ‘ served with his answer or objections ” on the opposing attorney and “filed with the clerk of the court within three days after such service ”. This respondent’s answer (labeled “Affidavit in Opposition”) was *266served and filed in January, 1960 but no demand for a jury trial was made until two months later. The paper served in January was of course an answer since in it respondent disputed “ the validity of the petitioner’s claim”, stated that no accounting was necessary since the estate’s assets were sufficient for all purposes and she was the sole beneficiary, and requested and consented that there be a trial of the issues in the Surrogate’s Court, It is suggested that the waiver argument comes too late. It was presented in the Appellate Division but not passed on in that court since the court’s holding was that there was no right to a jury trial. It is properly before us since it relates to a question of law only, appears on the face of the record and could not have been avoided if brought to appellant’s attention below (Persky v. Bank of America Nat. Assn., 261 N. Y. 212, 217-219; People v. Dwell, 1 N Y 2d 132, 134; Cohen and Karger, Powers of the New York Court of Appeals, pp. 626, 630).

The order should be affirmed, with costs, and the certified question answered in the negative.

Opinion by Judge Bergan in which Judges Dye, Fuld and Van Voorhis concur; Judge Scileppi concurs in result in the following memorandum: I concur in the result but only on the basis of the facts presented here. The parties in effect waived the accounting proceeding, consenting to a trial limited to the contested claim. If the claim were sued on in the Supreme Court, the parties would be entitled to a jury trial; why not so in this case? Judge Burke dissents in an opinion in which Chief Judge Desmond concurs in a separate opinion.

Order reversed, with costs in this court and in the Appellate Division, and the matter remitted to the Surrogates’ Court for further proceedings in accordance with the opinion herein. Question certified answered in the affirmative.