2009 Hawaii Code
Volume 13
TITLE 32 - COURTS AND COURT OFFICERS
CHAPTER 607 - COSTS AND FEES
§607-18 - Fees and expenses of trustees.

     §607-18  Fees and expenses of trustees.  (a)  Upon all moneys and other property received in the nature of revenue or income of the estate, such as rents, interest, dividends, and general profits, trustees, except trustees of a charitable trust, shall be allowed as commissions payable out of the income received during each year, seven per cent for the first $5,000 and five per cent for all over $5,000 the commissions to be payable as and when the income is received, but not more often than once a year.

     (b)  Upon the principal of the estate, trustees shall be allowed as commissions one per cent on the value at the inception of the trust payable at the inception out of the principal, one per cent on the value of all or any part of the estate upon final distribution payable at the termination out of the principal, and two and one-half per cent upon all cash principal received after the inception of the trust and neither being nor representing principal upon which the two and one-half per cent has previously at any time been charged, payable at the receipt out of the principal, and two and one-half per cent upon the final payment of any cash principal prior to the termination of the trust, payable at the final payment out of the principal, and in addition thereto five-tenths of one per cent on the value at the expiration of each year during the continuance of the trust payable annually out of the principal; provided that such five- tenths of one per cent on the principal shall not apply to charitable trusts, nor to the extent the trustee has employed others to perform bookkeeping and clerical services at the expense of the estate as permitted by the trust document or as provided in section 554A-3.

     (c)  Such further allowances may be made as the court deems just and reasonable for services performed in connection with sales or leases of real estate, contested or litigated claims against the estate, the adjustment and payment of extensive or complicated estate or inheritance taxes, the preparation of estate and income tax returns, the carrying on of the decedent's business pursuant to an order of court or under the provisions of any will, litigation in regard to the property of the estate, and such other special services as may be necessary for the trustee to perform, prosecute, or defend.  All contracts between a trustee and a beneficiary other than the creator of the trust, for higher compensation than is allowed in this section shall be void.

     (d)  This section shall apply as well to future accounting in existing estates as to new estates. [RL 1935, pt of §3793; am L 1935, c 124, §1; am L 1943, c 88, §1 and c 149, §1; RL 1945, §9757; am L 1947, c 100, §1; am L 1951, c 170, §1; RL 1955, §219-17; am L 1959, c 169, §1; HRS §607-18; am L 1976, c 200, pt of §1; am L 1988, c 362, §1; am L 1992, c 85, §1; am L 1993, c 34, §2]

 

Cross References

 

  Guardians, see §§560:5-209, 560:5-312, 560:5-414.

  Personal representatives, see §§560:3-719 to 721.

  Trustees, see §560:7-205.

 

Law Journals and Reviews

 

  Trustee Fees Under the Hawaii Probate Code:  Can the Court Approve Trustee Fee Schedules?  10 HBJ No. 13, at pg. 121.

 

Case Notes

 

  Based on the plain language of and legislative history underlying §560:7-205, courts may review the reasonableness of a trustee's determination as to what constitutes "income"; trustee's determination that property tax payments were "income" was reasonable.  104 H. 267, 88 P.3d 202.

 

Commissions.

  Trustee should be allowed reasonable compensation for trustee's time and trouble.  5 H. 196.  Trustees entitled to same fees as executors, administrators and guardians.  24 H. 414; 27 H. 780, 783; 28 H. 329; 31 H. 78.  Of guardian.  7 H. 368.  On principal collections.  16 H. 512.  On final payment.  16 H. 512; 29 H. 169; cf. 25 H. 121 (investment of money representing capital); 27 H. 736 (effected by exchange of receipts); cf.  16 H. 159.  On income from capital assets into which final payments have been previously converted.  37 H. 111.  On money realized.  13 H. 317.  On new loan or exchange of securities.  16 H. 512.  On chattels transferred in kind.  3 H. 288; 16 H. 159.  Whether paid out of corpus or income.  23 H. 335.  Whether taxes paid by lessee are income.  28 H. 502.  Death before completion of administration.  3 H. 178.  Statutory fees and compensation under will mutually exclusive.  3 H. 384.  Computation.  37 H. 111.  Not allowed on co-owner and beneficiary savings bonds.  39 H. 76.  Trustees accepting settlor's nomination are bound by settlor's compensation and not entitled to statutory compensation; successor trustee appointed by court, entitled to statutory rates.  51 H. 548, 465 P.2d 996.

 

Appraised value.

  33 H. 226.  Disallowance of because of neglect of duties.  8 H. 472; 9 H. 512; 11 H. 420; 11 H. 495; 13 H. 202; 13 H. 242; 13 H. 388; 13 H. 630; 14 H. 443; 17 H. 517; 18 H. 542; 26 H. 243, 247; 28 H. 590, 598.  Administrator under former statute.  9 H. 453.  Dishonesty.  33 H. 445.

 

Executors and administrators.

  Legal expenses, of.  3 H. 522; 26 H. 243.  Expense of establishing contested will.  16 H. 575.  Expenses of contestant.  26 H. 337.  Double commissions.  33 H. 666.  Counsel fees disallowed for legal services performed when neither necessary nor for benefit of the estate.  37 H. 447.  For professional services rendered by the attorney for the executor not legal but purely executorial, no allowance.  Id.

 

Masters.

  33 H. 220; 36 H. 728.

 

Further allowances.

  Realtor:  27 H. 780, 790.  Stockbroker:  24 H. 414.  Attorney:  11 H. 204; 15 H. 394.  Not if services unnecessary.  27 H. 343, 353; 27 H. 439.  Or if within ordinary duties.  27 H. 343, 351.  Neglect of duties effect on commissions.  14 H. 443; 17 H. 517; 26 H. 243, 274; 26 H. 774; 27 H. 343; 28 H. 590, 684; 32 H. 943; 26 F.2d 609; 31 F.2d 553.  No reduction under particular circumstances.  26 H. 774.  Attorney's fees to defend action to recover excessive trustee commissions denied.  51 H. 548, 465 P.2d 996.

 

Trustees.

  Additional compensation.  24 H. 414, 418 (special or professional services); 27 H. 780 (services as realtor).  Costs, expenses and attorney's fees.  23 H. 694 (proceeding for benefit of estate); 25 H. 786 (litigation of interest of beneficiaries); 24 H. 573 (construction of will); 24 H. 573 (suit by other than trustee); 23 H. 245 (of unsuccessful claimant to trust estate); right of appeal.  25 H. 786.  Employment of realtor.  29 H. 169.  Administrative expenses.  34 H. 417, questioned on other grounds 36 H. 440; 36 H. 403.  See also 36 H. 518, 631, 686.  Trustees:  Effect of breach of trust on right to commissions.  47 H. 548, 393 P.2d 96; 47 H. 629, 394 P.2d 432.

 

Cited.

  234 F.2d 227; 33 H. 666, 671, 234 F.2d 221, 226.