The Orphans’ Court had jurisdiction to consider the probate of a lost will after letters of administration had been issued to the decedent’s daughter, and even though the Register of Wills had never acted on a petition to probate the will and revoke the letters previously granted. Proof of the execution and contents of the will was not challenged on appeal, and the presumption of revocation by the testator was effectively rebutted by testimony that the decedent had continued to declare that he was disinheriting his daughter, and that the will could have been destroyed in the same gas explosion that killed the decedent and destroyed his home, presumably destroying the will as well. In re: Estate of Russell R. Felix, 1184 WDA 2022 (Pa. Super. 8/28/2023) (non-precedential).
The tax clause in the will directed that the estate and inheritance taxes payable “with respect to property or interests passing my will” were to be paid from the residue without apportionment, and so under 72 P.S. § 9144(f), the inheritance tax on the individual retirement accounts that were not part of the estate must be paid by the beneficiaries of those accounts and not from the residue of the estate. In re: Estate of J. Vincent Bavol, ___ A.3d ___, 2023 PA Super 138 (7/28/2023).
The PA Supreme Court has allowed an appeal on the following issue (as stated by the petitioner):
“Where a non-party to a partnership agreement is not a signatory to the agreement and is not a third-party beneficiary of it and where a partnership agreement does not permit assignment, whether the Court’s review is necessary to clarify the circumstances where a non-party could be permitted to ‘step into the shoes’ of a party to an agreement and to enforce contractual rights as if that individual were a party to the agreement.”
In re: Estate of Peter J. Caruso, III, 43 WAL 2023 (8/21/2023).
The Superior Court had allowed specific performance of a buy-sell provision in a partnership agreement even though 12 years had elapsed from the death of one of the two partners, because the conduct of the surviving partner and the deceased partner’s widow showed that they intended to continue to operate the partnership under the partnership agreement. In re: Estate of Peter J. Caruso, III, 1406 WDA 2021 (Pa. Super. 11/15/2022) (non-precedential).
Although the case does not involve issues of estate administration, the resolution of the case may be of interest to practitioners who prepare family partnership agreements and buy-sell agreements as part of their estate planning services.
[9/22/2024 Update: The Supreme Court reversed the Superior Court. See “Surviving Spouse Was Not a Partner under Partnership Agreement.”]
The Supreme Court has reversed the Superior Court and ruled that when a trust is created by an agent acting under a power of attorney that is void ab initio, the trust is also void. In re: Joseph L. Koepfinger, ___ Pa. ___, ___ A.3d ___, 20 WAP 2022 (8/22/2023), rev’g 123 WDA 2020 (Pa. Super. 2/4/2021) (non-precedential).
[DBE Comments: In my report of the allowance of the appeal by the Supreme Court, I noted that the Superior Court’s opinion was “largely incoherent.” In its opinion, the Supreme Court stated that “Respectfully, it is not entirely clear what the Superior Court ultimately held, as it did not directly address the issue at the heart of this matter, i.e., whether the judicial determination that the POA was void ab initio rendered the trust invalid.”]
The trustee was properly removed for commingling trust assets with his own, failing to make distributions in accordance with the trust instrument, and making distributions to himself without the approval of a disinterested trustee as required by the trust instrument. The Orphans’ Court properly directed distributions to one beneficiary because the trustee had denied distributions based on criteria outside of the trust instrument, but erred in directing distributions to another beneficiary because there was inadequate evidence as to the financial needs of that beneficiary. The court did not abuse its discretion in ordering the trustee to pay legal fees and costs of the beneficiaries for obdurate and vexatious conduct before and after the petition for removal was filed. Hallowell v. Hallowell, 1157 MDA 2022 (Pa. Super. 8/15/2023) (non-precedential).
A claimant born during the marriage of the decedent and the person’s mother, and “held out” by the decedent as a child of the decedent, was nevertheless not an “issue” entitled to an intestate share of the decedent’s estate when genetic testing initiated by the claimant showed that the decedent was not his father. Estate of John Robert Rose, 1164 WDA 2022 (Pa. Super. 8/17/2023) (non-precedential).
The Orphans’ Court Procedural Rules Committee has proposed amendments to Pa.R.O.C.P. Ch. 15, “Adoptions,” to comply with the federal Indian Child Welfare Act and its regulations. “Proposed Amendment of Pa.R.O.C.P. 15.2, 15.3, 15.7, 15.8, 15.9, 15.10, and 15.13,” 53 Pa.B. 5113 (8/19/2023).
The sister of the decedent, who was the decedent’s sole intestate heir but whose only interest under the previous will of the decedent (from 1987) was as an executor, had no standing to appeal from the probate of the decedent’s 2019 will under 20 Pa.C.S. § 908(a), the possibility of the prior will being held invalid being “too remote and speculative to confer standing.” In re: Estate of Mary Ellen Netzel, 984 WDA 2022 (Pa. Super. 8/11/2023) (non-precedential), aff’g, 1 Fid.Rep.4th 223 (Allegheny O.C. 2022) (see “Niece Not Named in Prior Wills Did Not Have Standing to Contest Later Will“).
The Appellate Court Procedural Rules Committee has proposed changes to the Rules of Appellate Procedure that would require the notice of appeal in an appeal from the Orphans’ Court to specifically state that it is an Orphans’ Court appeal, which is defined as an appeal under Pa.R.A.P. 342. According to the committee, the amendments are intended to reflect the operation of Pa.R.O.C.P. 4.6, which is similar to Pa.R.Civ.P. 236 and establishes the date of entry of an adjudication or decree in the Orphans’ Court. “Proposed Amendment of Pa.R.A.P. 102 and 904,” 53 Pa.B. 4962 (8/12/2023).
On remand from the Supreme Court, the Superior Court has held that, even if the settlor and beneficiaries could modify an irrevocable trust to allow the beneficiaries to remove and replace trustees, the modification might still be void for undue influence by the beneficiaries over the settlor. For an inter vivos transaction, only a confidential relationship needs to be shown in order to create a presumption of undue influence, not weakened intellect or substantial benefit, and allegations that children of the settlor conducted an “escalating pattern of direct contact” and “exploited” their positions as “beloved children” were sufficient to survive a motion for summary judgment. Finally, it was error for the Orphans’ Court to sua sponte raise the issue of the standing of the executor of the settlor’s estate when the parties had waived the issue by not raising it. Trust under Deed of Walter R. Garrison, 2023 PA Super 151, ___ A.3d ___ (8/8/2023), affirming in part, vacating in part, and remanding 10 Fid.Rep.3d 189 (Montgomery O.C. 2020), after remand by ___ Pa. ___, 288 A.3d 866 (2023).
[DBE Comment: The conclusion that children might have a “confidential relationship” with a parent merely because they are loved by the parent would seem to open up new opportunities for intra-family litigation.]