Trustee was not in contempt for preparing and filing an account that did not comply with the Rules of Orphans’ Court Procedure, but a surcharge was imposed “to uphold the authority of the Court,” although the fees of the CPA who prepared both the improper and revised account were held to be reasonable and properly paid by the trust. The trustee engaging her husband as a real estate agent to sell a property was not an act of self-dealing, but was negligent because her husband did not have sufficient experience, and so a surcharge equal to his commission was imposed, but no surcharge was imposed for the trustee’s failure to seek or anticipate a zoning change that increased the value of the property, the court finding the sale price to be reasonable. A surcharge was imposed for legal fees incurred in a separate civil action against the objector that was withdrawn with prejudice. Property management fees paid by the trustee to herself were approved. Della Franzia Real Estate Trust, 12 Fid.Rep.3d 447 (Bucks O.C. 2022).
The settlor of an irrevocable trust, who retained no interests in the trust, did not have standing to participate in proceedings regarding the account filed by, and possible removal of, the trustee, and the decision upholding preliminary objections to dismiss the settlor’s pleadings was not a final or appealable order. Middleton Trust, 12 Fid.Rep.3d 478 (Montgomery O.C. 2022), appeal quashed, 2024 PA Super 54 (3/25/2024). The settlor also did not have standing in an action brought by a beneficiary to challenge the appointment of a trustee or a change in situs of another trust for the same beneficiary, and the dismissal of the settlor’s answer and new matter was not an appealable order. Middleton Trust, 12 Fid.Rep.3d 543 (Montgomery O.C. 2022), appeal quashed, 2449 EDA 2022 (Pa. Super. 3/21/2024) (non-precedential).
[Note: The two opinions are similar, dealing with similar issues but different actions involving different trusts with the same settlor and the same beneficiary. The original version of this summary and this note did recognize those differences.]
Provision of will directing that the shares of beneficiaries receiving governmental “need-based benefits” shall instead be paid to any existing “special needs trust” for the beneficiary or, if there is no trust, the share shall lapse and be distributed as part of the residuary estate, was applied to two of four beneficiaries of a residuary trust, so that the trust income would be distributed to only the other two beneficiaries. Manno Estate, 12 Fid.Rep.3d 489 (Lycoming O.C. 2022)
Erie County has adopted new Orphans’ Court rules, to be effective 30 days after publication in the Pa. Bulletin, and superseding all previous rules. “Order Adopting Orphans’ Court Rules; Doc. No. 360 of 2022,” 52 Pa.B. 7366 (12/3/2022).
Washington County has adopted new local Orphans’ Court rules relating to the records and files of the court. “Adoption of Local Rules of Orphans’ Court Procedure L-O.C. Rule 1.41 and L-O.C. Rule 15.21; No. 2022-1,” 52 Pa.B. 7269 (11/26/2022).
Orphans’ Court had jurisdiction to clarify its own order despite lapse of time, and had jurisdiction over retirement funds which had been liquidated, and so its order enforcing settlement of estate and distribution of retirement funds was affirmed, along with sanctions against appellant, and additional sanctions imposed on appeal for “obdurate, dilatory and vexatious conduct.” In re: Estate of Coleen Tomcik, 2022 PA Super 192, ___ A.3d ___ (11/15/2022).
Testamentary gifts to step-grandchildren that were conditioned upon their grandmother (the decedent’s wife) not electing against the will and not recovering assets “in our divorce after my death” were ineffective by reason of a final decree of divorce (and equitable division of marital assets) even though the decree was entered before death and even though the scrivener of the will testified that the testator was concerned about equitable division after his death and not before. Cassidy Estate, 12 Fid.Rep.3d 423 (Bucks O.C. 2022), rev’d, d, 2023 PA Super 101, ___ A.3d. ___ (6/9/2023).
[Revised on 6/26/2023 to correct error in summary of holding.]
Small estate petition dismissed for failure to include a statement that the Pennsylvania inheritance tax return had been filed and the tax paid and failure to include a copy of a notice of appraisement, as required by Pa.R.O.C.P. 5.50(b)(5) and (c)(3), the provisions of which are mandatory and cannot be waived by the court. Eddinger Estate, 12 Fid.Rep.3d 419, 114 Berks 410 (Berks O.C. 2022).
Because the decedent’s will granted an option to purchase real estate at “the value as finally determined for Federal Estate Tax purposes,” the court ordered the executor to file a federal estate tax return even though the estate was too small to require one and even though the filling of the return will not resolve the dispute because the executors may claim special use valuation under I.R.C. section 2032A and some of the beneficiaries may refuse to join in the required agreement to pay the additional estate tax that might become due if the property ceases to be used for a “qualified use.” Finck Estate, 12 Fid.Rep.3d 381 (Lycoming O.C. 2022)
An individual trustee who is not a lawyer may not represent the trust in court. Delaware Valley Landscape Stone, Inc. v. RRQ, LLC, ___ A.3d ___, 2022 PA Super 173 (10/13/2022).