J. A09006/16

NON-PRECEDENTIAL DECISION – SEE SUPERIOR COURT I.O.P. 65.37

DAVID AULT :

:

IN THE SUPERIOR COURT OF

PENNSYLVANIA

v. :

:

ETHEL H. AND THOMAS E. AULT, : No. 1818 MDA 2015

:

 Appellants :

Appeal from the Judgment Entered October 16, 2015,

in the Court of Common Pleas of Centre County

Civil Division at No. 2014-2108

BEFORE: FORD ELLIOTT, P.J.E., JENKINS AND PLATT,* JJ.

MEMORANDUM BY FORD ELLIOTT, P.J.E.: FILED MAY 24, 2016

Ethel1 H. Ault and Thomas E. Ault (collectively, “appellants”) appeal 

the order of the Court of Common Pleas of Centre County that entered 

judgment in favor of David Ault in the amount of $35,506.

On September 25, 2001, Harland E. Ault, Ethel H. Ault, Thomas E. 

Ault, Clint Frazier, in his individual capacity and as trustee of the J.H. Ault 

Trust, Jaime Ault, and David Ault, in his individual capacity and as trustee 

for Dillon Ault, a minor (collectively, referred to as the “Partnership”) 

entered into a limited partnership agreement (“Partnership Agreement”) for 

 

* Retired Senior Judge assigned to the Superior Court.

1 Curiously, Ethel Ault’s first name is spelled “Ethyl” in certain documents 

and in the trial court caption even though she testified she spelled her name 

as “Ethel.” (Notes of testimony, 6/24/15 at 4.) The trial court 

acknowledged that her name was spelled incorrectly in the caption there.
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the purpose of the ownership and management of real estate. Harland E. 

Ault and Ethel H. Ault were the general partners as well as limited partners. 

Upon the death of Harland E. Ault, Ethel H. Ault became the sole general 

partner. Each limited partner currently has an interest of 14.8221 percent.

The Partnership entered into an agreement with S & A Homes for the 

sale of some real property owned by the Partnership. Under the terms of 

the agreement, S & A Homes made an initial payment to the Partnership and 

then annual payments for several years. In June 2013, S & A Homes made 

the last payment to the Partnership in the amount of $238,802. In July 

2013, Ethel H. Ault wrote distribution checks to each limited partner. The 

check for David Ault, Ethel Ault’s grandson, was made payable to David Ault 

or Thomas [E.] Ault. Thomas E. Ault is Ethel Ault’s son and David Ault’s 

father. Thomas E. Ault deposited the check into a Uniform Gifts to Minors 

custodial account for the benefit of David Ault’s three children. David Ault 

did not receive the check in the amount of $35,506.00. He learned of the 

distribution when he received the Partnership’s K-1 form in 2014.

On or about June 4, 2014, David Ault commenced an action in the trial 

court and alleged that appellants violated the terms of the Partnership 

Agreement when the check was issued to Thomas Ault but deposited into the 

account for the benefit of David Ault’s children. David Ault filed suit for 

$46,062 plus interest from July 2, 2013 plus costs.
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In answer and new matter, appellants alleged that Thomas E. Ault and 

David Ault discussed the 2013 distribution and that David Ault agreed that 

his distribution should be put in a Uniform Gifts to Minors Act custodial 

account with David Ault’s siblings, Nichole M. Mansell or Jaime J. Ault, 

appointed as custodians for the benefit of David Ault’s three children. 

Appellants requested that the complaint be dismissed.

Initially, the case proceeded to a panel of arbitrators due to the 

amount in dispute. The arbitrators awarded judgment in favor of David Ault 

in the amount of $10,556. Appellants appealed to the trial court.

On June 24, 2015, the trial court conducted a non-jury trial. Ethel H. 

Ault testified on cross-examination that as general partner she was the only 

person in charge of making disbursements. (Notes of testimony, 6/24/15 at 

5.) When asked why she made the July 2, 2013 distribution check payable 

to Thomas or David, she replied, “I guess that’s the way I wanted it.” (Id.

at 6.) She further testified that she gave the check to Thomas E. Ault and 

did not tell David Ault that she wrote the check to Thomas or David. (Id. at 

6.) Although the K-1 showed a distribution of $46,062 to David Ault, Ethel 

Ault explained that the actual amount was approximately $35,000. (Id. at 

7.)

David Ault testified that in February or March of 2014 his father, 

Thomas E. Ault, informed him that there was a distribution and that he had 

“Put it into a certificate of deposit for [David Ault’s] three children, and it 
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turns out [David Ault’s] brother and sister were named. It was their CD and 

benefit of the children.” (Id. at 10.) David Ault had to pay tax on this 

distribution even though he did not receive it. (Id. at 10-11.) He testified 

that he did not authorize Ethel H. Ault to distribute the funds for which he 

was entitled in the manner that she chose to distribute them. (Id. at 

11-12.) On cross-examination, David Ault denied that he reached an 

agreement with his father to place his distribution into an account for the 

benefit of his children and then forgot that he made such an authorization. 

(Id. at 17-18.)

Thomas E. Ault testified on cross-examination that he directed Ethel H. 

Ault to issue the distribution check to him or David Ault. Thomas E. Ault 

admitted that he deposited the check based on an oral agreement with 

David Ault. He admitted that he was estranged from his son. (Id. at 

21-22.) Thomas E. Ault explained how he reached the alleged oral 

agreement with David Ault:

Well, I talked to him in May of 2013, because the 

payment was coming in June, and I said to him 

about this payment coming, you know, and I 

suggested it be put in for his children.

He said, well, I didn’t know we had another payment 

coming.

I said, yeah. I said, this is the final payment from 

S&A.

He said, well, I didn’t know it was coming so it’s not 

like I’m going to miss it.
J. A09006/16

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Id. at 22.

Thomas E. Ault explained that he took his son’s statement that he was 

not going to miss the payment as his agreement with Thomas E. Ault’s plan 

to set up an account for his grandchildren, David Ault’s children. (Id. at 

23.) Thomas E. Ault did not inform David Ault after he opened the account 

for the minor children. (Id. at 25.) Thomas E. Ault admitted that he had no 

authority to direct Ethel H. Ault to issue the check to David Ault or 

Thomas E. Ault. (Id. at 26.) On direct examination, Thomas E. Ault 

testified that David Ault’s ex-wife agreed to the opening of the account for 

the children as she normally received a portion of David Ault’s distribution as 

a result of the divorce agreement. (Id. at 31.)

On August 19, 2015, the trial court entered judgment in favor of 

David Ault in the amount of $35,506.2

On August 31, 2015, appellants moved for post-trial relief and moved 

to modify the verdict. They asserted that David Ault was equitably estopped 

from seeking judgment against them because David Ault induced Thomas E. 

Ault to place the funds in the custodial account when he said that he would 

not miss the money and failed to object to the placement of the funds. 

On October 6, 2015, the trial court denied the motion for post-trial 

relief:

 

2 Although the total amount withdrawn and distributed according to the K-1 

was $46,062, the parties apparently agreed that the actual distribution from 

S & A Homes was $35,506.
J. A09006/16

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Here, [appellants] argue [David Ault] induced 

Defendant Thomas Ault to place [David Ault’s] 

distribution in a custodial account by stating that he 

would not miss the money and by failing to object to 

such placement of the funds. The conversation 

regarding the 2013 distribution, however, did not 

rise to the level of agreement or consent. The 

conversation was not sufficiently clear as to place an 

obligation on [David Ault] to further act or speak in 

opposition to the proposal. There was conflicting 

testimony regarding the conversation, and there was 

no testimony regarding a discussion about the 

manner in which the custodial account would be 

created. Merely stating he would not miss the 

money was insufficient to induce [appellants’] 

actions.

Further, [appellants] were not justified in 

relying on the conversation. The Partnership 

Agreement states “[c]ash, when available, shall be 

distributed by the general partners to all partners in 

the same ratio as profits and losses are allocated.” 

Agreement § 3.05. Under the partnership 

agreement, Defendant Thomas Ault is a limited 

partner and does not have the authority to alter the 

distribution or to direct Defendant Ethel Ault to alter 

the distribution. Defendant, Ethel Ault, as the 

general partner, had a duty to follow the Limited 

Partnership Agreement and dispense [David Ault’s] 

portion of the funds to him. As such, [appellants] 

were not justified in relying on the conversation with 

[David Ault].

Trial court opinion, 10/6/15 at 2-3.

Appellants raise the following issues for this court’s review:

1. Whether the trial court erred as a matter of 

law when it held that the law required an 

agreement or consent for [David Ault’s] actions 

to satisfy the element of inducement[?]

2. Whether the trial court abused its discretion in 

holding that [appellants] were not justified 
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under the circumstances in relying on the 

words and actions of [David Ault][?]

Appellants’ brief at 4.

This court’s review of a trial court’s denial of a motion for post-trial 

relief is limited to determining whether the trial court abused its discretion or 

committed an error of law. Paliometros v. Loyola, 932 A.2d 128, 132 

(Pa.Super. 2007). 

Initially, appellants contend that the trial court erred when it held that 

the law required an agreement or consent for David Ault’s actions to 

constitute inducement in order to satisfy the requirements of equitable 

estoppel.

Equitable estoppel is a doctrine that prevents 

one from doing an act differently than the manner in 

which another was induced by word or deed to 

expect. A doctrine sounding in equity, equitable 

estoppel recognizes that an informal promise implied 

by one’s words, deeds or representations which leads 

another to rely justifiably thereon to his own injury 

or detriment, may be enforced in equity. [Citations 

omitted.]

The two essential elements of equitable 

estoppel are inducement and justifiable reliance on 

that inducement. The inducement may be words or 

conduct and the acts that are induced may be by 

commission or forbearance provided that a change in 

condition results causing disadvantage to the one 

induced. See generally, Funds for Business 

Growth, Inc. v. Woodland Marble and Tile 

Company. . . 278 A.2d 922 ([Pa.] 1971); Ham v. 

Gouge . . . 257 A.2d 650 ([Pa.Super.] 1969).

The elements of equitable estoppel and the 

burden of proof required to support such a claim are 
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well stated in Blofsen v. Cutaiar . . . 333 A.2d 841 

([Pa.] 1975).

Equitable estoppel applies to 

prevent a party from assuming a position 

or asserting a right to another’s 

disadvantage inconsistent with a position 

previously taken . . . the person inducing 

the belief in the existence of a certain 

state of facts is estopped to deny that 

the state of facts does in truth exist, over 

a different or contrary state of facts as 

existing at the same time, or deny or 

repudiate his acts, conduct or 

statements.

. . . .

It is well established . . . that the burden 

rests on the party asserting the estoppel 

to establish such estoppel by clear, 

precise and unequivocal evidence.

Blofsen, 333 A.2d at 844.

Novelty Knitting Mills, Inc. v. Siskind, 457 A.2d 502, 503-504 (Pa. 

1983).

Here, appellants argue that David Ault’s statement that he would not

miss the distribution because he did not know it was coming induced them 

to make the check payable to Thomas Ault or David Ault and to establish the 

account for David Ault’s minor children. Further, the fact that David Ault did 

not object to the idea contributed to the inducement, according to 

appellants.

The trial court determined that David Ault’s statement that he would 

not miss the money was insufficient to induce appellants’ actions. 
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Appellants failed to convince the trial court that they met their burden to 

establish that David Ault was equitably estopped from challenging the 

transfer of the distribution to which he was entitled to an account for his 

children. This court is satisfied after reviewing the record that there is no 

basis upon which to disturb the trial court’s conclusions. This court agrees 

with the trial court that David Ault did not induce appellants to act.

Appellants also contend that the trial court abused its discretion when 

it found that they could not rely on the words and actions of David Ault to 

follow the course of action they did because the Partnership Agreement 

required that the general partner distribute available cash to the limited 

partners and that any change regarding the distribution was required to be 

in writing. Because this court determines that the trial court did not err 

when it found that David Ault did not agree to the placement of his share in 

an account for his children, this court need not address in detail the 

Partnership Agreement. However, this court notes that the trial court 

accurately stated that the Partnership Agreement required Ethel H. Ault as 

general partner to pay the distribution to David Ault, a limited partner. The 

Partnership Agreement also states that any amendment to it requires the 

written consent of all partners. Thomas E. Ault did not have authority under 

the Partnership Agreement to direct Ethel H. Ault to take David Ault’s 

distribution and make a check in the amount of the distribution to Thomas 
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Ault or David Ault. Further, Ethel H. Ault did not have the authority to make 

that decision herself. 

Judgment affirmed.

Judgment Entered.

JosephD.Seletyn,Esq.

Prothonotary

Date: 5/24/2016