attorney, inasmuch as it is not generally lawful for a corporation to practice law. Those fiduciary relations which it may undertake are specified in general trust company laws of the states or in special charters. The following are the fiduciary powers specified in the New Jersey Trust Company Law: 1

(1) To act as the fiscal or transfer agent of any state, municipality, body politic or corporation and in such capacity to receive and disburse money;

(2) To transfer, register and countersign certificates of stock, bonds or other evidences of indebtedness, and to act as agent of any corporation, foreign or domestic, for any purpose now or hereafter required by statute or otherwise;

(3) To receive deposits of trust moneys, securities and other personal property from any person or corporation, and to loan money on real or personal securities;

(4) To lease, hold, purchase and convey any and all real property necessary for or convenient in the transaction of its business, or which the purposes of the corporation may require, or which it shall acquire in satisfaction or partial satisfaction of debts due the corporation under sales, judgments or mortgages, or in settlement or partial settlement of debts due the corporation by any of its debtors;

(5) To act as trustee under any mortgage or bond issued by any municipality, body politic or corporation, and to accept and execute any other municipal or corporate trust not inconsistent with the laws of this state;

(6) To accept trusts from and execute trusts for married women, in respect to their separate property, and to be their agent in the management of such property, or to transact any business in relation thereto;

(7) To act, under the order or appointment of any court of record, as guardian, receiver or trustee of the estate of any minor, and as depository of any moneys paid into court, whether for the benefit of any such minor or other person, corporation or party;

(8) To take, accept and execute any and all such legal trusts, duties and powers in regard to the holding, management and disposition of any estate, real or personal, and the rents and profits thereof, or the sale thereof, as may be granted or confided to it by any court of record, or by any person, corporation, municipal or other authority, and it shall be accountable to all parties in interest for the faithful discharge of every such trust, duty or power which it may so accept;

1 Laws of New Jersey Relating to Banks and Banking, Trust Companies and Safe Deposit Corporations, 1926, pp. 65–8.

(9) To take, accept and execute any and all such trusts and powers of whatever nature or description as may be conferred upon or intrusted or committed to it by any person or persons, or any body politic, corporation or other authority, by grant, assignment, transfer, devise, bequest or otherwise, or which may be intrusted or committed or transferred to it or vested in it by order of any court of record, or any surrogate, and to receive and take and hold any property or estate, real or personal, which may be the subject of any such trust;

(11) To be appointed and to accept the appointment of assignee or trustee, under any assignment for the benefit of creditors of any debtor, made pursuant to any statute or otherwise;

(12) To act under the order or appointment of the court of chancery or otherwise as receiver or trustee of the estate or property of any person, firm, association or corporation;

(13) To be appointed and to accept the appointment of executor of or trustee under the last will and testament or administrator with or without the will annexed, of the estate of any deceased person, and to be appointed and to act as the committee of the estates of lunatics, idiots, persons of unsound mind and habitual drunkards;

(15) To collect coupons on, or interest upon all manner of securities when authorized so to do by the parties depositing the same;

(16) To receive and manage any sinking fund of any corporation, upon such terms as may be agreed upon between said corporation and those dealing with it;

(17) Generally to execute trusts of every description not inconsistent with the laws of this state or of the United States.

The provisions relating to fiduciary powers of banks contained in the trust company laws of the various other states are similar to these, although there is considerable variation in the wording and arrangement, and some variation as to the powers granted as has already been indicated. The uniformity with respect to powers granted by the various states is greater now than it was a few years ago.

Auxiliary Powers Specified in State Laws. The auxiliary powers are those relating to life insurance, fidelity insurance, title insurance, safe deposit, and guaranty services. In most

states there is some type of limitation in the law as to the granting of these auxiliary powers, especially fidelity and title insurance. Very few states permit life insurance business except where a special charter grant has been made before the enactment of a general incorporation law. Following are the provisions in the New Jersey law on auxiliary powers:

(10) To purchase, invest in, and sell stocks, promissory notes, bills of exchange, bonds and mortgages and other securities; and when moneys or securities for moneys are borrowed or received on deposit, or for investment, the bonds or obligations of the company may be given therefor, but it shall have no right to issue bills to circulate as money;

(14) To exercise the powers conferred on and to carry on the business of a safe deposit company; to examine and guarantee title to land; to insure the fidelity of persons holding offices or places of trust or responsibility; and to become sole surety in any case where by law two or more sureties are required; provided, such powers and purposes are enumerated in the certificate of incorporation.

Statutory Compensation for Certain Fiduciary Services. In most of the states there is statutory provision governing the fees to be charged for such fiduciary services as executor, guardian, testamentary trustee, etc., the same whether such services are performed by an individual or by a trust company. Where there is no such statutory provision the fee is fixed or passed upon and approved by the probate court and a customary fee is thus established; in fact that is how the statutory fees were evolved. For example in the State of New York, the statutory fees are as follows:

1

Fees for Executors, or Administrators

In the case of an executor or administrator the fee is figured on the total value of the estate (including income) which passes through his hands in the course of administration, and is fixed in accordance with the following scale:

1 Surrogate's Court Act, Section 285, as amended May 22, 1923, Laws of New York, 1923, chap. 649.

The fee is permitted to be collected at the time of the final accounting which is generally a year or eighteen months after the death of the testator, or the intestate, as the case may be.

Fees for Testamentary Trustees, Guardians, etc.

The fees for testamentary trustees, guardians, etc., since the service is expected to extend over a period of time, are allowed to be collected upon a different basis, although they are calculated upon the same principle. The fee is figured upon both the principal and the annual income and the income fee is taken yearly; the fee on the principal is payable one-half when the trust becomes effective, the other half when it is terminated, according to the following scale:

(a) The Income Fee Payable Annually

5% on the first

22% on the next

12% on the next

2% on all amounts of income over

$ 2,000 of income

20,000 of income

28,000 of income

50,000

(b) The Fee upon Principal payable one-half at the beginning and one-half upon termination of trust—

Departure from the statutory fees may be made by agreement between the parties or by a legacy or devise in the last will of the deceased made in lieu of commissions. Cases where there is agreement between the parties before the death of the testator, or where the gift in lieu of commissions is greater than the statutory fees, are not likely to come to the attention of the courts. But where an executor or trustee is not satisfied with the gift in lieu of commission provided by the will, the law usually provides that he has the privilege of electing to take the compensation fixed by the statute instead of the gift. In practice, however, it has been found very difficult to depart from the provisions of the last will even in this respect; and the

weight of authority seems to be in favor of the proposition that a gift to an executor in lieu of commission must be accepted instead of the usual allowances for the service under the law.1

There is considerable lack of uniformity of statutory fees as between the various states and in some cases the difference is very marked. Some years ago estimates were made for a number of states of the cost of administering an estate of $50,000 and it was found that in New York it would cost $690, while in Missouri it would cost $2,500 and in Colorado only $145. The average for the various states was calculated to be $1,100, or 2.2%. Since that time the laws of New York and Colorado have been changed. At the present time under New York law the fee for administering an estate of $50,000 would be $1,020, while under the present Colorado law it must not exceed $3,000 or 6% if the estate consists entirely of personal property. The Colorado law allows a maximum of 3% on money received from the sale, mortgage, or lease of land. Under the present California law the charge allowed on an estate of $50,000 would be $1,330. The schedule under the California law is as follows:

The fees for other fiduciary services rendered by trust companies are subject to court review and approval: only in the case of living trusts and agencies, where no account is rendered to the probate court, are the fees strictly competitive.3

State Supervision of Trust Companies. Being a creature of the state, the trust company is subject under state law to vari1 Vierling, Frederick, "Laws Governing Compensation of Executors," Trust Companies, Vol. 42 (January, 1926), pp. 33-7.

2 Editorial. "Basis of Commission Charges and Fees for Trust Companies Under Corporate and Individual Trusts," Trust Companies, Vol. 6 (1908), pp. 84-90, 154-8, 216–20, 291-4, 366-8, 410-3, 476–7.

Appendix A, infra, pp. 565-83, contains a schedule of trust company charges, compiled by the Committee on Standardization of Charges, Trust Company Division, American Bankers Association.