The Orphans’ Court denied the objections to the executor’s account based upon the testimony of the executor which the court found to be credible, and the court did not find the testimony of the objectant and the objectant’s son to be credible. The court’s factual findings and credibility determinations were supported by the record and will not be disturbed on appeal. The objectant argued that account statements were “missing” that were needed to determine “where the missing money went” while the executor served as the decedent’s agent, but the objectant failed to raise any discovery issues and so failed to meet her burden of proof. In re: Estate of Aileen Minnock, Deceased, 1386 WDA 2023 (7/30/2024) (non-precedential).
The Orphans’ Court properly entered a judgment on the pleadings denying a petition to change the beneficiaries of the decedent’s individual retirement account (IRA) when the decedent did not comply with the change of beneficiary procedures required by the custodian of the IRA and the petition relied instead upon a note found after the decedent’s death that was written on the back of an envelope, which the court found was inconsistent with her prior emails to the custodian and was too ambiguous to support a finding that the decedent had done all she reasonably could to comply with the custodian’s procedures to change the beneficiaries. Estate of Carol D. Stanley, 1424 WDA 2023 (8/5/2024) (non-precedential).
The Pa. Rules of Appellate Procedure have been amended to define “Orphans’ Court appeal,” provide a new rule for determining the date on which Orphans’ Court orders have been entered, and require that the notice of appeal from the Orphans’ Court include a statement that the appeal is an Orphans’ Court appeal. “Order Amending Rules 102, 108, and 904 of the Pennsylvania Rules of Appellate Procedure; No. 312 Appellate Procedural Rules Docket” (7/26/2024), 54 Pa.B. 5079 (8/10/2024).
The appointment of a “guardian ad litem” to manage the financial affairs and make medical decisions for the alleged incapacitated person was vacated when three years had elapsed from the initial petition, there was no record of any notice to the alleged incapacitated person, and there was no finding of incapacity, because the appointment was not authorized by 20 Pa.C.S. §§ 5511 or 5513 or by the rules of court for the appointment of guardians ad litem. Estate of J.L.C., an Alleged Incapacitated Person, 2024 PA Super 151, ___ A.3d ___ (7/22/2024).
It was proper for the Orphans’ Court to approve the sale of the decedent’s residence to a third party for $150,000 rather than allow the heir who occupied the property to purchase her half of the property in monthly installments of $1,000 because the sale to the third party would provide cash to the estate that would allow the administrator “to alleviate the ongoing expenses of the residence, to settle the debts of the estate, to pay the inheritance tax, and to make appropriate distribution of the remaining balance of the estate funds to the heirs, all within a reasonable time.” In re: Estate of Constance Grace Patterson, 1173 WDA 2023 (Pa. Super. 7/22/2024) (non-precedential).
The Internal Revenue Service has published final regulations to address some of the changes to the required minimum distribution rules under the amendments to section 401(a)(9) made by sections 114 and 401 of the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act). “Required Minimum Distributions,” TD 10001, 89 F.R. 58886 (7/19/2024).
These final regulations do not address some of the changes made by the SECURE 2.0 Act of 2022 (Division T of the Consolidated Appropriations Act, 2023, Public Law 117–328, 136 Stat. 4459
(12/29/2022)), and so new proposed regulations have been published. “Required Minimum Distributions+,” REG-103529-23, 89 F.R. 58644 (7/19/2024).
One significant issue that is resolved by the new final regulations is whether required minimum distributions to an “eligible designated beneficiary,” which must be completed within 10 years, can be deferred for 10 years (like distributions subject to the 5 year limit can be deferred). It was originally thought that no distributions were required during the 10 year period, but under the final regulations the eligible designated beneficiary of an employee who had reached the required beginning date must continue to receive distributions based on the age of the deceased employee, and then receive the balance of the account at the end of the 10 years. (See “IRS Publication 590-B To Be Corrected” for some of the history of the confusion on this issue.)
The SECURE Act changes to section 401(a)(9) were summarized as “New (and Old) Minimum Required Distribution Rules Summarized” (1/28/2020), which will be updated as required by the new final and proposed regulations.
It was reversible error for the Orphans’ Court to fail to consider extrinsic evidence to resolve a latent ambiguity in a will. The decedent had owned five parcels of real property, and had specifically devised one parcel to five of his seven children, but the residuary beneficiary had claimed that a gift of “293-241 Farragut Terrace” did not include the entire property that the decedent had owned and known as 293-243 Farragut Terrace (now known as Farragut Street) , so the property should be subdivided to create a property to be known as 243 Farragut Street to pass as part of the residue of the estate. The Orphans’ Court failed to consider the scheme of the will and the “natural intention of the testator,” because the evidence showed that there was no property with the address “239-241 Farragut Street” separate from any property known as “243 Farragut Street,” and the “239-241” in the will was “plainly the scrivener’s error.” The beneficiary was therefore entitled to sell the entire property consistent with 20 Pa.C.S. § 301(b), and the purchaser was entitled to specific performance of the agreement of sale. Estate of Walter Edmonds, Deceased, 204 PA Super 147, ___ A.3d ___ (7/16/2024).
It was not an abuse of discretion for the Orphans’ Court to appoint two of the three children of the alleged incapacitated person (AIP) as plenary guardians of her person over the objections of an estranged daughter when the AIP had been living with one of the two guardians, the AIP testified that she wished to remain in that guardian’s home, and there was testimony that the AIP was being well cared for. It was not an abuse of discretion for the hearing judge to deny a motion for recusal based on the judge’s previously hearing a divorce action involving the objecting daughter when the objecting daughter failed to identify what information the judge received in that case that might be relevant to the appointment of guardians. That the guardians of the persons might have financial conflicts of interests was not relevant because an independent guardian of the estate had been appointed. The findings of fact by the hearing judge were timely because one of the initial orders made the findings of fact required by 20 Pa.C.S. § 5512.1(a), and the objecting daughter was not prejudiced by the entry of additional findings of fact after the appeal was filed. Finally, it was not an abuse of discretion for the court to dismiss without prejudice claims of undue influence when the objecting daughter failed to appear at the scheduling hearing. In re: C.A.J., an Alleged Incapacitated Person, 2024 PA Super 141, ___ A.3d ___ (7/9/2024).
The power of an agent to engage in “banking and financial transactions” gave the agent the power to liquidate certificates of deposit created by the decedent (referred to as “Totten trusts”). The beneficiary named on the C.D.s raised other issues in support of her claim against the estate for the proceeds of the C.D.s, but the claims were all considered to be waived for failure to properly develop her arguments, or were found to be harmless errors by the Orphans’ Court. In re: Estate of Willard Charles Gritser, Deceased, 741 WDA 2023 (Pa. Super. 5/7/2024) (non-precedential).
S.B. 115 has been passed by both houses of the Pennsylvania legislature and was signed by the governor on July 17, 2024, becoming Act 65 of 2024, P.L. ___, to be effective in 60 days.
The bill amends 20 Pa.C.S. § 3101(e) (one of the provisions for dispositions for which letters are not required) to enlarge the category of persons who may claim unclaimed property deposited with the Pennsylvania Treasurer. Previously, claimants could be a spouse, child, mother or father, or sister or brother of the decedent. As amended, § 3101(e) allows claims by a spouse, issue, parents, brother or sister (or issue of a brother or sister), or grandparent of the decedent, with preference given in that order. So grandchildren (and their issue), nephews and nieces (and their issue), and grandparents are now included among the permissible claimants.
A new requirement for making the claim is that the sworn affidavit that is required must state that the claimant is among the persons with the strongest claim to the property.