J-A21010-14

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

IN RE: ESTATE OF PERCY D. 

KNAPPENBERGER ALSO KNOWN AS 

PERCY DONALD KNAPPENBERGER, 

DECEASED,

IN THE SUPERIOR COURT OF

PENNSYLVANIA

APPEAL OF: JOSEPH KNAPPENBERGER, 

INDIVIDUALLY AND AS EXECUTOR OF 

THE ESTATE OF PERCY D. 

KNAPPENBERGER A/K/A PERCY DONALD 

KNAPPENBERGER,

Appellant No. 182 EDA 2014

Appeal from the Order Entered December 12, 2013

In the Court of Common Pleas of Lehigh County

Orphans' Court at No(s): 2010-1932

BEFORE: BOWES, OTT, and STRASSBURGER,*JJ.

MEMORANDUM BY BOWES, J.: FILED OCTOBER 08, 2014

Joseph Knappenberger, both individually and in his capacity as the 

personal representative of the estate of his father Percy D. Knappenberger, 

appeals from an order entered on December 12, 2013. In the order, the 

orphans’ court imposed a constructive trust on a portion of the proceeds of a 

mortgage that Appellant secured on real estate that he inherited from his 

father.1 We affirm. 

____________________________________________

*

 Retired Senior Judge assigned to the Superior Court.

1

 The order in question is a final one since it resolved the only outstanding 

request for relief pertaining to the estate. 
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Percy D. Knappenberger died testate on October 21, 2010. On 

December 1, 2010, the Register of Wills of Lehigh County admitted to 

probate his last will and testament dated October 1993. In the will, Gerald 

Woodring, decedent’s brother-in-law, was named as the executor of the 

estate, and his wife Martha Woodring, decedent’s sister, was named as the 

alternative executrix. Both Gerald, who died in 2011, and Martha, who is 

the Appellee in this matter, renounced their right to serve as personal 

representative of Percy’s estate. Appellant, as his father’s sole heir under 

the will, was appointed administrator c.t.a.2 The last advertisement of the 

opening of the estate occurred on July 28, 2011. The net value of the 

estate, after payment of administrative expenses and debts, was 

approximately $165,000. 

On May 8, 2012, Martha filed a timely notice of claim against the 

estate in the amount of $30,410.37. She contended that the estate owed 

her that amount based upon a loan that she and Gerald had made to Percy. 

The following document evidenced the loan in question: 

TO WHOM IT MAY CONCERN!

MONEY LOANED TO PERCY FROM 12/9/2002 TO PRESENT

PER PHONE CONVERSATION TODAY WITH PERCY, THIS IS 

VERIFICATION THAT I, GERALD C. WOODRING, HAVE BEEN 

____________________________________________

2

 These letters are an abbreviation for the Latin term cum testament 

annexo. The term is employed when the decedent leaves a will and either 

neglects to name a personal representative, or the named executor or 

executrix is unable or unwilling to serve.
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PAYING PERCY’S BILLS AS NEEDED, FROM MY HOME EQUITY 

LOAN TO KEEP HIM FROM LOOSING [SIC] EVERYTHING THAT HE 

HAS BEEN WORKING FOR THE PAST FORTY PLUS YEARS. 

LISTED BELOW IS THE AMOUNT, NOW OWED ME OR MY WIFE, 

NOT INCLUDING INTEREST FOR USE OF MONEY! $30,410.37

Notice of Claim, 5/8/12, at Exhibit 1. Both Percy and Gerald executed this 

document, which also was notarized.

On October 26, 2012, Martha filed a petition for citation to show cause 

why an accounting should not be filed. In his answer to the petition, 

Appellant denied that Percy owed Martha any money since, under the 

document in question, Percy never agreed to repay that amount and, 

instead, merely acknowledged receipt of the funds. In his new matter, 

Appellant raised the defense that the four-year statute of limitations had 

expired for collection of the loan. 

After the citation was issued, the matter proceeded to a hearing, and 

the parties filed countervailing proposed findings of fact and conclusions of 

law. Appellant argued that the April 24, 2004 document was not an 

enforceable debt since it did not contain an unconditional promise by Percy 

to pay back the loan to Gerald. Appellant also asserted that a four-year 

statute of limitations applied to any debt collection and prevented Martha 

from prevailing in her action against the estate. 

Martha raised counter-arguments as to why the April 24, 2004 writing 

evidenced a still-enforceable debt. She also maintained that a constructive 

trust should be imposed on either Percy’s probate assets or on the proceeds 
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of any probate assets then held by Appellant. Proposed Findings of Fact and 

Conclusions of Law, 5/13/20, ¶ II (6). She presented argument and legal 

authority on the doctrine of constructive trusts. Id. at 10. Martha also 

averred: 

10. Respondent/Defendant induced Martha C. Woodring and 

Gerald C. Woodring to renounce their appointment as 

executors of Decedent’s estate in return for a promise that 

the Debt would be paid by the Respondent/Defendant 

and/or the Decedent’s estate. 

11. Martha C. Woodring relied upon Respondent/Defendant in 

agreeing to renounce her position as executor.

Id. at ¶ I (10-11). 

In a pre-hearing memorandum, Martha again raised the position that a 

constructive trust should be imposed against Appellant, and amended her 

petition for citation to include an allegation that she was owed the money 

outlined in the notice of claim under a theory of constructive trust. 

Hearings were held on September 3 and 4, 2013. The evidence 

viewed in the light most favorable to Martha, as the prevailing party, is as 

follows. During his lifetime, Percy was loaned $30,410.37 by his sister 

Martha and Martha’s husband Gerald. June Kinek, Percy and Martha’s sister, 

testified that Martha showed her the April 24, 2004 document executed by 

Percy. Ms. Kinek also had discussions with Percy about his financial 

situation. Percy told her, “[H]e was having a hard time at different times in 

his life. He was laid off, . . . and he was out of jobs and looking for jobs 

and, of course, his – his financial situation suffered.” N.T. Hearing, 9/4/13, 
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at 9. Percy also admitted to June that “he had a paper signed and that he 

owed Martha and Gerald $30,000.” Id. at 110. Percy acknowledged the 

debt on several other occasions. Id. One time, Ms. Kinek overheard Percy 

speaking with her husband, and Percy said that “he wanted to pay Martha 

and Gerald the $30,000, but he just didn’t have the money to do it.” Id. at 

16. Ronald Kinek, June’s husband, also verified that this conversation 

occurred. 

The primary asset of the estate was Percy’s home, which was valued 

at $230,000. Appellant received that asset after re-financing the existing 

mortgage on the house. At the hearing, it was established that Appellant 

reported to his loan officer that he owed Martha $30,000. Specifically, 

Appellant told the loan officer, Ronald Gildner, that his intention in obtaining 

the mortgage “was to pay off any debts that his dad had, that being the 

mortgage, a loan to Martha and funeral debts.” N.T. Hearing, 9/3/13, at 10.

Mr. Gildner retained a handwritten list of the liabilities that Appellant 

represented to Mr. Gildner that Appellant intended to satisfy with the loan 

proceeds. Mr. Gildner’s list included a notation that $30,000 was to be 

distributed to Appellant’s Aunt Martha. Additionally, Appellant gave the loan 

officer a printout of the debts that he planned to pay with the proceeds of 

the mortgage; one of the entries on the printout was “Martha $30,000.” Id. 

at 12. Mr. Gildner indicated that a mortgage was given to Appellant for 

$155,000, that it was secured by the real estate that Appellant inherited 
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from his father, and that a portion of the proceeds of the loan were 

distributed to Appellant with the remainder sent to satisfy the outstanding 

mortgage on the property. 

Martha confirmed that she was told by Appellant that the mortgage 

proceeds would be used to pay the debt owed by Percy to her and her 

husband. She testified as to the circumstances of that discussion. As noted, 

Gerald and Martha were supposed to be the personal representatives of the 

estate. Gerald was ill and unable to serve in that capacity and executed a 

renunciation. Although she was the alternative personal representative and 

capable of performing that role, Martha also executed a renunciation. 

Martha reported that, during discussions about her and her husband 

renouncing, she and Appellant discussed the existing financial situation 

among Percy, Martha, and Gerald. At that time, Appellant told her that he 

would “redo the mortgage and pay bills; one of them would be to pay his 

Aunt Martha.” N.T. Hearing, 9/4/13, at 45. 

During argument at the hearing, Martha contended that Percy’s estate 

was contractually obligated to repay the debt to her or, in the alternative, 

that Appellant owed her the money pursuant to a constructive trust that 

should be imposed on the mortgage proceeds. Id. at 52-54, 107. Appellant 

took the position that the April 24, 2004 document was not a contractual 

obligation since there was no promise to pay. He also raised the defense of 
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the statute of limitations under 42 Pa.C.S. § 5525, which contains the fouryear statute of limitations applicable to contracts. 

On December 12, 2013, the orphans’ court rendered its ruling. It 

concluded that the April 24, 2004 document was unenforceable as a 

promissory note since it contained no express promise to pay on the part of 

Percy and was merely an acknowledgement of the debt. 13 Pa.C.S. § 3104.3 

It also concluded that, even if the document contained a promise to pay a 

debt, Martha’s claim was barred by the applicable four-year statute of 

limitations. 

The orphans’ court, however, accepted Martha’s position as to 

Appellant and imposed a constructive trust for her benefit on $30,410.37 of 

the proceeds of the mortgage retained by Appellant. Appellant did not file 

optional exceptions to the orphans’ court’s decision, and instead, filed this 

direct appeal. Appellant raises these contentions. 

I. After denying the claim of Martha Woodring as 

unenforceable and time barred, did the trial judge commit error 

when he nevertheless directed Joseph Knappenberger, in order 

to prevent his unjust enrichment, to pay Martha Woodring the 

amount of her claim pursuant to a constructive trust that he 

imposed upon a portion of the funds Joseph Knappenberger had 

received in May, 2011 from the refinance of the home he 

inherited from his father.

____________________________________________

3

 With additional requirements not here relevant, that section defines a 

negotiable instrument and provides that such a document consists of “an 

unconditional promise or order to pay a fixed amount of money, with or 

without interest or other charges described in the promise or order[.]” 13 

Pa.C.S. § 3104(a). 
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II. Under the facts of this case, is the imposition of a 

constructive trust barred by the five year statute of limitations?

III. Under the facts of this case, is the imposition of a 

constructive trust barred by the doctrine of laches?

Appellant’s brief at 7. 

Initially, we outline the applicable standard of review. 

When reviewing a decree entered by the Orphans' Court, 

this Court must determine whether the record is free from legal 

error and the court's factual findings are supported by the 

evidence. Because the Orphans' Court sits as the fact-finder, it 

determines the credibility of the witnesses and, on review, we 

will not reverse its credibility determinations absent an abuse of 

that discretion. However, we are not constrained to give the 

same deference to any resulting legal conclusions. Where the 

rules of law on which the court relied are palpably wrong or 

clearly inapplicable, we will reverse the court's decree.

In re Estate of Fuller, 87 A.3d 330, 333 (Pa.Super. 2014) (citation 

omitted). 

A constructive trust is defined as “a relationship with respect to 

property subjecting the person by whom the title to the property is held to 

an equitable duty to convey it to another on the ground that his acquisition 

or retention of the property is wrongful and that he would be unjustly 

enriched if he were permitted to retain the property.” City of Philadelphia 

v. Heinel Motors, 16 A.2d 761, 765 (Pa.Super. 1940) (quoting 

Restatement (First) of the Law of Trusts, § 1(e)). Such a trust is imposed to 

redress a wrong or prevent unjust enrichment and is remedial in nature. 

Thus, “when relief through imposition of a constructive trust is prayed for, it 

is not the specific intent between the parties to create a constructive trust 
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but rather whether or not imposition of a constructive trust is necessary to 

prevent unjust enrichment.” DePaul v. DePaul, 429 A.2d 1192, 1194 

(Pa.Super. 1981). This principle is echoed in the pertinent provisions of the 

Restatement of Trusts, which discusses constructive trusts in comment to

§ 1, as follows:

A constructive trust is a relationship with respect to 

property usually subjecting the person by whom its title is held 

to an equitable duty to convey the property to another on the 

ground that the title holder’s acquisition or retention of the 

property is wrongful and that unjust enrichment would occur if 

the title holder were permitted to retain the property. See 

Restatement of Restitution § 160 [“Where a person holding title 

to property is subject to an equitable duty to convey it to 

another on the ground that he would be unjustly enriched if he 

were permitted to retain it, a constructive trust arises.”] . . .

Both express trusts and resulting trusts are based upon an 

intention of the person who creates them. . . . On the other 

hand, a constructive trust is imposed, not necessarily to 

effectuate an expressed or implied intention, but to redress a 

wrong or to prevent unjust enrichment. A constructive trust is 

thus the result of judicial intervention and is remedial in 

character. 

Restatement (Third) of Trusts § 1. Pennsylvania principles applicable to 

constructive trusts are consistent:

A constructive trust arises when a person holding title to 

property is subject to an equitable duty to convey it to another 

on the ground he would be unjustly enriched if he were 

permitted to retain it. The necessity for such a trust may arise 

from circumstances evidencing fraud, duress, undue influence or 

mistake. The controlling factor in determining whether a 

constructive trust should be imposed is whether it is necessary 

to prevent unjust enrichment. One who seeks the imposition of 

a constructive trust must do so by clear, direct, precise and 

convincing evidence. 
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Hercules v. Jones, 609 A.2d 837, 841 (Pa.Super. 1992) (citation omitted). 

The constructive trust is the means by which a wrong is redressed. 

We conclude that the orphans’ court did not abuse its discretion in 

imposing a constructive trust herein. On April 24, 2004, Percy 

acknowledged that he had received $30,410.37 from Martha and Gerald “to 

keep him from loosing [sic] everything that he has been working for the past 

forty plus years.” Notice of Claim, 5/8/12, at Exhibit 1. In other words, 

Appellant would not have had a house to inherit if his aunt and uncle had not 

given Percy the money in question. Thus, Appellant obtained a house, in the 

first instance, only through the generosity of Martha and Gerald. This debt 

was openly acknowledged by Percy, who wanted to repay it. 

Then, Appellant verbally and in writing admitted that the money was 

owed. Appellant told his loan officer and Martha that he would repay the 

debt from the proceeds of the mortgage. Martha renounced her right to 

serve as executrix after discussions with Appellant wherein he represented, 

as administrator c.t.a., that he would mortgage the house and repay her the 

money that Percy owed. Then, after acknowledging and promising to pay 

the debt from the mortgage proceeds, Appellant retained the money that he 

was entitled to receive only due to the loan made by Martha and Gerald. 

A clear wrong was committed that must be redressed through equity. 

Appellant would be unjustly enriched by the retention of the $30,410.37 

from the mortgage proceeds. That amount enabled his father to retain 
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ownership of the asset that was used to secure the loan upon which the 

constructive trust was imposed. The court’s application of the doctrine in 

question is unassailable. 

Appellant’s first claim is that a constructive trust was improperly 

imposed in this case since “imposition of a constructive trust is appropriate 

only where the defendant has no right whatsoever to the property he 

holds in violation of the Plaintiff’s rights.” Appellant’s brief at 17-18 

(emphasis in original). Appellant notes that he legally owned the real estate 

in question and that he was entitled to mortgage it as its owner. Id. at 19. 

Appellant’s argument is misguided and confusing. The constructive 

trust doctrine provides that property legally owned by one person can be 

subject to a constructive trust. The fact that Appellant “legally owned” his 

house and was “legally entitled” to the mortgage proceeds simply does not 

prevent application of the constructive trust doctrine; indeed, that ownership 

scenario is precisely when the doctrine applies. A constructive trust is 

imposed when a person legally owns property but would be unjustly 

enriched by its retention. It is employed when the person in question has a 

legal but not a just right to the property. 

Appellant also appears to argue that a constructive trust must be 

imposed on all rather than some of the property at issue. In other words, he 

claims that it was impossible to impose a constructive trust on only a portion 

of the property in question. We find no support in applicable precedent for 
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this principle. As noted, the entire focus of the constructive trust doctrine is 

whether a person possessing certain property would be unjustly enriched by 

its retention. It is clear that Appellant was unjustly enriched from the 

mortgage proceeds only by the sum of $30,410.37. 

Not only is Appellant’s position in this respect unsupported by 

reference to legal authority, it is refuted by the equitable and remedial 

nature of the doctrine itself. As we aptly stated in Kohr v. Kohr, 413 A.2d 

687, 690 (Pa.Super. 1979), “a court of equity in decreeing a constructive 

trust is bound by no unyielding formula. The equity of the transaction must 

shape the measure of relief.” This precedent clearly dispels any notion that 

a constructive trust cannot be imposed upon a portion of assets received by 

the unjustly enriched person. 

Appellant also maintains that the “evidence fails to support the trial 

judge’s conclusion that without the loan Percy Knappenberger would have 

lost his home in foreclosure.” Appellant’s brief at 20 (quotation marks 

omitted). We disagree. The orphans’ court’s finding in this respect is firmly 

premised upon the very language of the April 24, 2004 document. Therein, 

Percy admitted that he would have lost everything that he owned had he not 

received the loan in question. The property that Percy owned included the 

house inherited by Appellant. While Appellant points to the fact that there 

were never any foreclosure proceedings, this argument does nothing more 

than reinforce the strength of Martha’s case. The fact that no mortgage 
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foreclosure proceedings were instituted was the result of her and her 

husband’s generosity to Percy when he was experiencing financial 

difficulties. 

Appellant’s second contention is that the imposition of the constructive 

trust was barred by the five-year statute of limitation. He relies upon 42 

Pa.C.S. § 5526(3), which provides, “The following actions and proceedings 

must be commenced within five years . . . [a]n action to enforce any equity 

of redemption or any implied or resulting trust as to real property.” The 

statute in question applies to constructive trusts. Truver v. Kennedy, 229 

A.2d 468 (Pa. 1967). However, Appellant did not raise § 5526 as the 

applicable statute of limitations to the trial court. 

Even if he had, it would not bar this action. Martha took two positions 

herein. The first was against Percy’s estate in that she claimed that the loan 

was still legally enforceable. The second cause of action was against 

Appellant personally. She averred that a constructive trust was created as 

to Appellant upon his receipt of the mortgage proceeds. Thus, the 

constructive trust did not come into existence until Appellant received the 

house, mortgaged it, and did not pay Martha the money that his father used 

to retain ownership of the house, and that Appellant openly promised to pay 

to both Mr. Gilbert and his aunt. These activities occurred in 2010 and 

2012. The constructive trust in question was imposed on December 12, 

2013, well within the five-year period. Thus, this action is timely as to the 
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activities that formed the basis for the equitable cause of action seeking a 

constructive trust against Appellant.4 

Appellant’s final position is that the doctrine of laches barred the 

imposition of a constructive trust. This issue is waived. The defense of 

laches was not raised in the pre-trial or trial proceedings. Appellant was 

fully apprised of Martha’s alternative theory of recovery under the doctrine 

of constructive trusts during pre-hearing proceedings, and had ample 

opportunity to present this issue to the orphans’ court. It is settled that 

issues that are not raised in the trial court cannot be raised for the first time 

on appeal and are considered waived. Green v. Green, 69 A.3d 282, 

286 (Pa.Super. 2013); Pa.R.A.P. 302(a). 

Order affirmed. 

Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 10/8/2014

____________________________________________

4

 This Memorandum should not be read to allow the imposition of a 

constructive trust whenever a legal claim would be barred by the statute of 

limitations. The instant facts are sui generis.