
    The People of the State of New York, Appellant, v. Knickerbocker Trust Company and Ernest Thalmann and Others, as Temporary Receivers of the Knickerbocker Trust Company, Respondents.
    Second Department,
    June 5,1908.
    Receivers of corporation — practice — determination of commissions — excessive allowance — acquiescence of corporation.
    Where on a motion to discharge temporary receivers of a corporation, for an accounting and for permission to resume business, all parties are before the court, it has jurisdiction to determine the compensation of the receivers as part of the accounting. A separate proceeding for that purpose is not necessary or proper.
    Where temporary,receivers of a trust company have served only five months, an allowance to them and their counsel' of §75,000 each is grossly excessive and should be reduced to §30,000 each.
    The fact that the officers of the trust, company consent to the larger amount and urge its allowance does not preclude the court, nor is the Attorney-General entitled to produce evidence of the value of the services of the receivers and their counsel, nor is a reference for that purpose necessary.
    Appeal by the plaintiff, The People of the State of New York, from an order of the Supreme Court, made at the Richmond Special Term and entered in the office of the clerk of the county of Richmond on the 28th day of March, 1908, as resettled, fixing the fees and compensation of the temporary receivers for the Knickerbocker Trust Company and of their counsel.
    The temporary receivers were appointed herein on October 25, 1907. They were never made permanent.
    
      William A. Deford, Deputy Attorney-General [ William S. Jackson, Attorney-General, with him on the brief], for the appellant.
    
      Charles H. Tuttle [Julien T. Davies with him on the brief], for the respondent Trust Company.
    
      George W. Wickersham [Frederick B. Van Vorst and Henry L. Scheuerman with him on the brief], for the receivers, respondents.
   Gaynor, J.:

All of the parties were regularly before the court on an application of the defendant trust company to be allowed to resume business, and have the three temporary receivers turn over the assets to it and be discharged*^: their trust. The account of their proceedings and the approval of the Superintendent of Banks of such resumption were also before the court. The application was granted.

It was .in order on the said accounting and discharge of the temporary receivers for their compensation and expenses to be fixed and ordered paid out of the assets before they should be turned over to the trust company. That is the settled practice on the accounting of executors, trustees and receivers. It is not necessary to institute a separate proceeding for that purpose, and it is never done. It is part and parcel of the accounting. The claim that the-court had no jurisdiction to fix such compensation and expenses is therefore without foundation. But the amount - allowed was so • grossly excessive as to amount to a spoliation of the assets of the trust company, and the order must be reversed or else modified for that reason. To allow it to stand would implant general distrust of the administration of justice. The temporary receivers served for only five months. The allowance of $75,000 to each for compensation, and the same sum to their counsel, in all the great sum of $300,000, is so disproportionate as not to wear the appearance of unhampered judicial discretion and judgment, but of having been arranged by. agreement between the temporary receivers and the' directors of the trust company, and adopted by the court inadvertently, or without the exercise of its controlling judgment and discretion. This also appears from the peculiar form of the order, viz., that the sums fixed should be paid provided the trust company consented, Which its officers promptly did. Inasmuch as the trust duty of the directors of the trust company is to be diligent to have these charge's upon the funds of the trust company fixed as low as possible, it seems. strange that they should send counsel here to argue in favor of the compensation as fixed below. It imparts a strange moral aspect to the case, to say the least. It is urged that the court should not assume a paternal supervision over the directors of the trust company, but should be satisfied with or let pass what they are willing to do in the premises; but if there could be any force at all in such a suggestion in any case, this is not such a case. • ■

We deem it our duty to exercise our judgment and discretion in the reduction of the amounts fixed to a proper sum, notwithstand ing the persistence of the deputy Attorney General in arguing that he should be given opportunity to produce evidence of the extent and value of the services of the receivers and their counsel. He suggests a reference, but it is unnecessary, and only calculated to make useless expense and protract the settlement of the matter. It is not difficult for a court to see what the compensation should be without the aid of a reference; and if the Attorney General desired to introduce evidence, he should have asked leave to do so n at the special term.

The order is modified by reducing the compensation of each temporary receiver from $75,000 to $20,000, and that of counsel from $75,000 to $20,000, and as ^ojnodified it is affirmed.

Woodward, Jenks, Hooker and Hiller, JJ., concurred.

Order modified by reducing the compensation of each temporary receiver from $75,000 to $20,000, and that of counsel from $75,000 to $20,000, and as so modified affirmed, without costs.  