Court Opinion

ID: 4446809
Source: CourtListenerOpinion
Date Created: 2019-10-15 17:09:31.733624+00
Date Added: 2024-06-11T14:53:12.838109
License: Public Domain

J-A18044-19

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

 KAREN PIHAKIS, ALEX PIHAKIS, AND         :   IN THE SUPERIOR COURT OF
 MIKELLYNN TSANGARIS,                     :         PENNSYLVANIA
                                          :
                       Appellants         :
                                          :
                                          :
              v.                          :
                                          :
                                          :
 JULIE KREEFER                            :        No. 308 WDA 2019

               Appeal from the Order Entered February 6, 2019
              in the Court of Common Pleas of Allegheny County
                    Civil Division at No(s): GD-18-013542

BEFORE: BOWES, J., NICHOLS, J., and MUSMANNO, J.

MEMORANDUM BY MUSMANNO, J.:                       FILED OCTOBER 15, 2019

      Karen Pihakis (“Karen”), Alex Pihakis (“Alex”), and Mikellynn Tsangaris

(“Mikellynn”) (collectively, “Plaintiffs”) appeal from the Order sustaining the

Preliminary Objections filed by Julie Kreefer (“Kreefer”), and dismissing, with

prejudice, Plaintiffs’ Complaint.   We reverse the trial court’s Order, and

remand for further proceedings.

      Dave Celio (“Decedent”) died testate on December 11, 2017. Decedent

was survived by Kreefer, his daughter. Decedent was also survived by his

fiancée, Karen, and her children, Alex and Mikellynn.

      On October 22, 2018, Plaintiffs filed a Complaint, alleging, in relevant

part, the following:

      4. At the time of his death, Decedent was the owner [of] and
      insured under a certain life insurance policy issued by Jackson
      National Life Insurance Company. The Decedent’s life was insured
      thereunder for the face amount of $500,000.00, and [Kreefer]
J-A18044-19

     was the named sole beneficiary of the proceeds of this policy at
     the time of Decedent’s death.

     5. Decedent drafted and[,] on October 16, 2017, dated and signed
     a certain document (the “Document”), a copy of which is attached
     hereto as Exhibit A (except for the certification by the notary
     public, which was added by the notary public after Decedent’s
     death), wherein he expressed his desires as to whom he wished
     to receive the proceeds of the aforesaid Jackson National Life
     Insurance Company policy (“the Jackson life insurance policy”), a
     certain Annuity Contract issued by Athene (the “annuity”)[,] and
     a certain Accidental Death Insurance Policy issued by AAA
     (“accidental death policy”).

     6. During a meeting, which was held in late October[] 2017 (at a
     time when Decedent was afflicted with terminal cancer) at the
     Decedent’s residence[,] and which was attended by the Decedent,
     [Kreefer], [Kreefer’s] husband, [] Karen and [] Alex[,] Decedent
     distributed one (1) copy of the Document to [] Karen and []
     Alex[,] and one (1) copy of the Document to [Kreefer].

     7. At the time that [Decedent] distributed the Document to the
     said attendees, he advised them that he had drafted the
     Document and confirmed that the Document set forth the
     amounts of money which he wanted each of the persons named
     therein to receive from the Jackson life insurance policy, the
     annuity, and the accidental death policy.

     8. Decedent then asked [Kreefer] if she [] agreed to make certain
     that his wishes would be carried out[,] and that each of the
     persons named in the Document would receive the respective
     amounts of money specified therein at the time of his death.

     9. [Kreefer] promised and agreed with the Decedent and promised
     [] Karen and [] Alex that she [] would comply with the Decedent’s
     wishes, as expressed in the Document, and would make certain
     that each of the persons named in the Document would receive
     the respective amounts of money specified therein at the time of
     Decedent’s death in connection with the assets specified therein.

     10. Specifically[,] with regard to the $500,000.00 payable at his
     death under the Jackson life insurance policy, Decedent indicated
     in the Document that he wanted:

                                   -2-
J-A18044-19

          A. His grandsons, Sean Kreefer and Scott Kreffer [sic] to each
          receive the sum of $25,000.00,

          B. [Kreefer] to receive the sum of $50,000.00,

          C. [] Karen to receive the sum of $380,000.00, and

          D. [] Karen’s children, namely [] Alex and [] Mikellynn[,] to
          each receive the sum of $10,000.00.

     11. At the time that [Kreefer] made the aforesaid promise to the
     Decedent and [] Karen and [] Alex[,] with regard to the
     Decedent’s requested distribution of the Jackson life insurance
     policy proceeds, the Decedent, [Kreefer], and [] Karen and [] Alex
     knew that [Kreefer] was then the sole named beneficiary of said
     proceeds on the Beneficiary Designation form that the Decedent
     had filed previously with the Jackson National Life Insurance
     Company.

     ….

     14. The Decedent never [changed the beneficiary designation to
     reflect his desires, as stated in the Document,] and [] Karen and
     [] Alex never did anything to encourage Decedent to do so prior
     to Decedent’s death[,] because they each relied upon [Kreefer’s]
     promise and agreement that she would distribute the proceeds
     payable under the Jackson life insurance policy in accordance with
     Decedent’s desires[,] as reflected in the Document.

     ….

     16. Since no change was made on the beneficiary designation on
     file with the Jackson National Life Insurance Company prior to the
     Decedent’s death, said company paid the $500,000.00 in life
     insurance proceeds solely to [Kreefer].

     17. After Decedent’s death, [Kreefer] broke and repudiated the
     promise which she had made to the Decedent, [] Karen and []
     Alex[,] and breached the agreement that she had made with
     Decedent[,] by refusing to distribute the insurance proceeds in
     accordance with the Document[,] and in spite of Plaintiffs’ request
     that she do so.

                                     -3-
J-A18044-19

Complaint, 10/22/18, at ¶¶ 4-17; see also id., Exhibit A (Document).

Plaintiffs asserted claims of promissory estoppel, breach of contract, waiver of

the right to receive the insurance proceeds, fraud, and constructive trust.

        Kreefer filed Preliminary Objections, and a brief in support thereof, on

November 13, 2018, alleging that Plaintiffs had failed to state any claim upon

which relief could be granted.1            In her Preliminary Objections, Kreefer

specifically denied making the alleged promise, and further asserted the

following: (1) a beneficiary designation may only be amended through the

procedures described in the policy; (2) Plaintiffs’ claim as to the existence of

an oral contract is barred by the Statute of Frauds, and any testimony

concerning the oral exchange between Decedent and Kreefer would be

prohibited by the Dead Man’s Act;2 (3) even if Kreefer had made the alleged

promise, it would be unreasonable for Plaintiffs to rely on such a promise; (4)

such an alleged contract would be unsupported by consideration, as it would

result in a $450,000.00 reduction in benefit to Kreefer; (5) a waiver of the

right to receive insurance proceeds is not a cognizable cause of action; and

(6) Plaintiffs did not allege the existence of a confidential relationship in

support of their claim for constructive trust. Further, Kreefer asserted that

____________________________________________

1 The Preliminary Objections were not entered on the docket until December
4, 2018.

2   See 42 Pa.C.S.A. § 5930.

                                           -4-
J-A18044-19

Plaintiffs’ Complaint should be dismissed, due to the pendency of a prior action

in Orphans’ Court.3 On December 3, 2018, Plaintiffs filed a Response, and a

brief in opposition to Kreefer’s Preliminary Objections. Following a hearing,

the trial court entered an Order sustaining Kreefer’s Preliminary Objections,

and, determining that the defects could not be cured by amendment,

dismissing Plaintiffs’ Complaint, with prejudice.

       Plaintiffs filed a timely Notice of Appeal, and a court-ordered Pa.R.A.P.

1925(b) Concise Statement of errors complained of on appeal. The trial court

thereafter filed an Opinion pursuant to Pa.R.A.P. 1925(a).

       Plaintiffs raise the following issues for our review:

       1. Whether the lower [c]ourt erred in sustaining [Kreefer’s]
       Preliminary Objections and dismissing Count I of [Plaintiffs’]
       Complaint for failure to state a claim for promissory estoppel[?]

       2. Whether the lower [c]ourt erred in sustaining [Kreefer’s]
       Preliminary Objection and dismissing Count II of [Plaintiffs’]
       Complaint for failure to state a claim for breach of contract[?]

       3. Whether the lower [c]ourt erred in sustaining [Kreefer’s]
       Preliminary Objection and dismissing Count IV of [Plaintiffs’]
       Complaint for failure to state a claim for fraud[?]

       4. Whether the lower [c]ourt erred in sustaining [Kreefer’s]
       Preliminary Objection and dismissing Count V of [Plaintiff’s]
       Complaint for failure to state a claim based upon which the lower
       [c]ourt could properly impose a constructive trust upon said life
       insurance proceeds paid to [Kreefer?]

____________________________________________

3 The above-mentioned Orphans’ Court case concerns Karen’s attempt to
submit another handwritten note as a codicil to Decedent’s Last Will and
Testament.

                                           -5-
J-A18044-19

      5. Whether the lower [c]ourt erred in failing to find that [Plaintiffs]
      stated a claim against [Kreefer] in their Complaint, based upon
      [Kreefer’s] waiver, as more fully set forth in Count III of
      [Plaintiffs’] Complaint[?]

Plaintiffs’ Brief at 4.

      Our standard of review for an order sustaining preliminary objections is

well settled.

      In determining whether the trial court properly sustained
      preliminary objections, the appellate court must examine the
      averments in the complaint, together with the documents and
      exhibits attached thereto, in order to evaluate the sufficiency of
      the facts averred. The impetus of our inquiry is to determine the
      legal sufficiency of the complaint and whether the pleading would
      permit recovery if ultimately proven. This Court will reverse the
      trial court’s decision regarding preliminary objections only where
      there has been an error of law or abuse of discretion. When
      sustaining the trial court’s ruling will result in the denial of claim
      or a dismissal of suit, preliminary objections will be sustained only
      where the case is free and clear of doubt.

Brosovic v. Nationwide Mut. Ins., 841 A.2d 1071, 1073 (Pa. Super. 2004)

(citation omitted); see also Francesco v. Group Health Inc., 964 A.2d 897,

899 (Pa. Super. 2008) (stating that this Court “must determine from the facts

averred, whether the law says with certainty that no recovery is possible.”

(citation omitted)).

      In their first issue, Plaintiffs claim that the trial court erred by sustaining

Kreefer’s Preliminary Objection to their claim for promissory estoppel on the

basis that Plaintiffs’ reliance on Kreefer’s promise was unreasonable.          See

Plaintiff’s Brief at 11-13. Plaintiffs direct our attention to paragraphs 19-21 of

the Complaint, wherein they assert the following:

                                       -6-
J-A18044-19

     19. When [Kreefer] made the aforesaid promise to the Decedent
     and [] Karen and [] Alex, [Kreefer] should have reasonably
     expected that said promise would induce forbearance on the part
     of Decedent and said Plaintiffs.

     20. Decedent and said Plaintiffs actually refrained from taking
     action in reliance upon [Kreefer’s] said promise; that is, Decedent
     never made any change of beneficiary designation that was on file
     with Jackson Life Insurance Company[,] and said Plaintiffs never
     did anything to encourage Decedent to do so prior to Decedent’s
     death[,] because they each justifiably and reasonably believed
     that [Kreefer] would keep her promise that she made to them.

     21. Assuming without admitting that [Kreefer’s] aforesaid promise
     was not supported by consideration, injustice can be avoided in
     this case only by enforcing [Kreefer’s] said promise on the basis
     of the doctrine of promissory estoppel.

See id. at 12 (citing Complaint, 10/22/18, at ¶¶ 19-21).

     The doctrine of promissory estoppel permits a claimant to enforce an

agreement between parties in the absence of consideration.        Crouse v.

Cyclops Indus., 745 A.2d 606, 610 (Pa. 2000).

     To maintain a promissory estoppel action[,] a claimant must aver
     the following elements: (1) the promisor made a promise that
     [she] should have reasonably expected would induce action or
     forbearance on the part of the promisee; (2) the promisee actually
     took action or refrained from taking action in reliance on the
     promise; and (3) injustice can be avoided only by enforcing the
     promise.

Sullivan v. Chartwell Inv. Partners, LP, 873 A.2d 710, 717-18 (Pa. Super.

2005) (citation and quotation marks omitted); see also Pennsy Supply, Inc.

v. Am. Ash Recycling Corp., 895 A.2d 595, 606 (Pa. Super. 2006) (referring

to RESTATEMENT (SECOND)   OF   CONTRACTS § 90, which would permit recovery by

                                       -7-
J-A18044-19

an intended third party beneficiary who justifiably relies on a promise made

by the promise).

      Our review confirms that Count I of Plaintiffs’ Complaint includes

assertions supporting each of the elements of a promissory estoppel claim.

See id.     Accepting as true the facts asserted in the Complaint, and all

inferences drawn therefrom, we conclude that Plaintiffs have pled sufficient

facts to establish a prima facie claim of promissory estoppel. See Brosovic,

supra; Sullivan, supra. We therefore reverse the trial court’s Order granting

Kreefer’s Preliminary Objection with regard to Plaintiffs’ claim for promissory

estoppel.

      In their second issue, Plaintiffs aver that the trial court improperly

dismissed their claim for breach of contract, finding that there was no

consideration for Kreefer’s promise. See Plaintiffs’ Brief at 13-15. Plaintiffs

claim that, at the time Kreefer promised Decedent that she would abide by his

wishes concerning the distribution of his life insurance proceeds, she had no

intention of keeping her promise. Id. at 14. Plaintiffs also argue that Kreefer

suspected that, had she failed to agree, Decedent would have changed the

beneficiary designation on his policy. Id.

      “A cause of action for breach of contract must be established by pleading

(1) the existence of a contract, including its essential terms, (2) a breach of a

duty imposed by the contract and (3) resultant damages.” Pennsy Supply,

895 A.2d at 600 (citation and quotation marks omitted); see also id.

(explaining that consideration is “an essential element of an enforceable

                                      -8-
J-A18044-19

contract.” (citation omitted)).   “Clarity [in the pleadings] is particularly

important where an oral contract is alleged.” Id. Additionally, “in the case of

a disputed oral contract, what was said and done by the parties, as well as

what was intended by what was said and done by the parties, are questions

of fact to be resolved by the trier of fact….” Johnston the Florist, Inc. v.

TEDCO Const. Corp., 657 A.2d 511, 516 (Pa. Super. 1995).

      In its Memorandum in Support of Order, the trial court concluded that

“[t]he oral promise alleged is unsupported by consideration and is

unambiguously gratuitous and unenforceable.” Memorandum in Support of

Order, 2/6/18, at 4. Here, Plaintiffs alleged that Kreefer and Decedent entered

into an oral contract whereby Kreefer would distribute the proceeds from the

Jackson life insurance policy in accordance with the wishes set forth in the

Document, and that Plaintiffs were the intended beneficiaries of the oral

contract. See generally Complaint, 10/22/18, at ¶¶ 4-17. In light of the

facts alleged in Plaintiffs’ Complaint, which are assumed to be true, and the

inferences reasonably deducible therefrom, we conclude that the averments

in Plaintiffs’ Complaint were adequate to survive Kreefer’s Preliminary

Objections. Indeed, Plaintiffs pled the existence of an oral contract, Kreefer’s

failure to distribute the Jackson life insurance policy proceeds under the oral

contract, and damages.     See id.; see also Sullivan, 873 A.2d at 716-17

(concluding that preliminary objections in the nature of a demurrer were

improperly granted on a breach of contract claim where appellant averred the

existence of a contract, the appellee’s breach of the contract, and damages).

                                     -9-
J-A18044-19

Further, whether the words, actions, and intentions of Kreefer and Decedent

actually gave rise to an enforceable oral contract is a question for the fact

finder. See Johnston the Florist, supra; see also Sullivan, 873 A.2d at

716 (stating that while the “[a]ppellant will carry the burden of proving the

oral agreement’s existence at trial, for purposes of this appeal [from an order

granting preliminary objections] we are constrained to accept [a]ppellant’s

averments as true.”).      Accordingly, we reverse the trial court’s Order

sustaining Kreefer’s Preliminary Objection as to Plaintiffs’ breach of contract

claim.

      Each of Plaintiffs’ remaining issues presupposes the existence of a valid

oral contract between Kreefer and Decedent. See Plaintiffs’ Brief at 15-17

(asserting that Kreefer waived her right to receive the full $500,000.00 life

insurance proceeds by entering into a superseding contract with Decedent),

17-21 (claiming that Kreefer entered into the oral contract with no intention

of performing under its terms), 21-22 (arguing that Kreefer’s retention of the

Jackson life insurance policy proceeds, in violation of the terms of the oral

contract, entitled Plaintiffs to the imposition of a constructive trust). Because

we have determined that Plaintiffs’ Complaint was sufficiently pled as to the

existence of an enforceable oral contract, and Plaintiffs’ remaining claims rely

on essentially the same facts and assertions, we must similarly reverse the

trial court’s Order sustaining Kreefer’s Preliminary Objections as to Plaintiffs’

claims for waiver, fraud, and constructive trust.

                                     - 10 -
J-A18044-19

      Based upon the foregoing, we reverse the trial court’s Order dismissing

Plaintiffs’ Complaint with prejudice, and remand the case for further

proceedings.

      Order reversed. Case remanded for further proceedings. Jurisdiction

relinquished.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 10/15/2019

                                   - 11 -