Court Opinion

ID: 9957102
Source: CourtListenerOpinion
Date Created: 2024-04-03 17:11:38.524034+00
Date Added: 2024-06-11T08:18:06.251478
License: Public Domain

J-A05032-24

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT O.P. 65.37

 IN RE: ESTATE OF FRED                     :   IN THE SUPERIOR COURT OF
 GITTERMAN, DECEASED                       :        PENNSYLVANIA
                                           :
                                           :
 APPEAL OF: ESTATE OF FRED                 :
 GITTERMAN, DECEASED                       :
                                           :
                                           :
                                           :   No. 1647 EDA 2023

               Appeal from the Decree Entered June 5, 2023
    In the Court of Common Pleas of Delaware County Orphans’ Court at
                          No(s): 0286-2018-O

BEFORE: DUBOW, J., KING, J., and LANE, J.

MEMORANDUM BY LANE, J.:                                  FILED APRIL 3, 2024

      The Estate of Fred Gitterman, deceased (“the Estate”), appeals from the

decree which distributed the balance of the Estate to Heidi Gitterman

(“Gitterman”) and Francine Smolen (“Smolen”). We affirm.

      The orphans’ court summarized the relevant factual and procedural

history as follows:

            Frederick [“]Fred[”] Gitterman ([“]decedent[”]) was
      tragically killed in a hit and run accident in . . . March . . . 2018.
      Earlier in his life, decedent met . . . Gitterman, at [college] where
      they began dating, and . . . married in . . . 1970. . . . In 1980,
      decedent and . . . Gitterman divorced, although they maintained
      a caring relationship.

            Unfortunately, decedent[, an attorney,] eventually lost his
      law license, and in around 2012, was in dire need of financial
      assistance. Starting [i]n October . . . 2012, . . . Gitterman began
      lending money to decedent for his food, hotel rooms, and payment
      of his bills. . . . [Gitterman’s sister,] Smolen[,] began lending
      decedent funds for basic food and lodging starting in 2014, when
      she learned from her sister of decedent’s financial situation.
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            Decedent was very specific in his written communications
     with the two sisters in stating exactly the amounts that he
     believed he owed each of them, and he would provide time ranges
     in which he believed he would be able to make repayments. . . .
     Gitterman carefully tracked the funds being loaned to decedent in
     a document she titled “Loans to Freddy 2012 – 2017.” . . .
     Smolen kept a chronology of the money that she loaned decedent
     in the form of a spreadsheet. Communications between decedent
     and . . . Gitterman[,] and decedent and . . . Smolen[,] reflected
     that the payments being made for decedent’s expenses were in
     the form of a loan. In return, decedent kept . . . Gitterman and
     . . . Smolen informed as to potential career opportunities and his
     financial abilities.  Decedent acknowledged the specific loan
     amounts owed to [Gitterman and Smolen] in emails dated
     February 22, 2016, November 4, 2016, and October 22, 2017.

           . . . Gitterman testified that throughout the time that she
     was lending decedent money, she was aware that he was
     attempting to obtain funds and he was acknowledging what
     amounts she loaned him. She testified that there are letters,
     e[]mails, text messages, and phone calls discussing the debt, the
     importance of paying the debt, and decedent’s agreement to
     repaying it. . . . Gitterman testified that she knew decedent was
     getting healthier and had confidence that he was going to make
     repayment. . . . Gitterman testified that she had specific
     knowledge of decedent’s communications with extremely
     prominent businessmen. . . .

            The discussions between . . . Smolen and decedent were
     clear that [her] payments to decedent were in the form of a loan.
     . . . Smolen testified that decedent would often confirm how much
     money was owed to . . . Smolen, and decedent would indicate that
     he would be repaying with interest. . . . Smolen testified that her
     understanding of the loan agreement was that when decedent had
     the money, or some money, he would make repayment. She
     testified that she expected that at some point, he would have the
     money. She testified that “there were so many ways that he was
     looking into making money.” . . . Smolen testified that she was
     aware of his pursuit of many business ventures and his work as a
     paralegal to attempt to bring himself into good standing as an
     attorney. . . .

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Orphans’ Court Opinion, 9/28/23, at 3-6 (citations to the record and

unnecessary capitalization omitted).

      Shortly after decedent’s death, Laurence M. Cramer, Esquire (“Attorney

Cramer”) filed a petition for the grant of letters of administration, averring

that decedent died intestate and that his sister, Sue Ellen Reinish (“Reinish”)

was his sole surviving heir. Attorney Cramer was thereafter appointed as the

Administrator of the Estate.

      Gitterman subsequently produced a copy of a handwritten will executed

by decedent in 2013 in which he left his entire estate to her and named her

as executrix.   Gitterman renounced her position as executrix, and instead

appointed Howard L. Gleit, Esquire (“Attorney Gleit”) as executor.           The

Register of Wills accepted the copy of the 2013 will for probate, revoked the

letters of administration issued to Attorney Cramer, and granted letters of

administration to Attorney Gleit. Following a de novo appeal to the orphans’

court, the court issued a decree removing the copy of the 2013 will from

probate and setting aside the letters of administration issued to Attorney Gleit.

This Court affirmed the orphans’ court decree.          See In re Estate of

Gitterman, 793 EDA 2020 (Pa. Super. 2021) (unpublished memorandum)

(affirming the orphans’ court’s determination that, because the original 2013

will was never found, a presumption arose that decedent revoked or destroyed

it, and Gitterman failed to rebut this presumption with clear, direct, weighty

and convincing evidence).

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       In April 2020, while the prior appeal was pending, Gitterman and

Smolen executed notices of claims against the Estate. Gitterman’s claim was

for the amount of $120,340.59, which included the accumulated loan amounts

of $81,258.83, plus six percent statutory interest.1 Smolen’s claim was for

the amount of $44,405, which included the accumulated loan amounts of

$25,308.64, plus six percent statutory interest.2

       Meanwhile, the Estate initiated a lawsuit against the driver who struck

decedent and recovered $225,000 in settlement of a wrongful death claim.

The Estate did not provide notice of the settlement to Gitterman or Smolen,

despite the fact that they had filed notices of claims against the Estate.

       Gitterman and Smolen filed a petition to compel the filing of an

accounting of the Estate. The Estate filed a petition for adjudication as well

as a proposed distribution and accounting, which advocated that the balance

of the Estate, consisting of $82,092.30, be distributed to Reinish. Gitterman

and Smolen filed objections to the proposed accounting.            The parties

conducted videotaped depositions of Gitterman and Smolen. The sisters each

alleged that they made loans to decedent from 2012 through 2018 pursuant

to an oral agreement that decedent would repay them when he returned to

____________________________________________

1 Gitterman filed an additional notice of claim for the monetary gifts that
decedent promised to give her in the amount of $111,500.

2 Smolen filed an additional notice of claim for the monetary gifts that
decedent promised to give her in the amount of $37,500.

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work or when funds would be available to him. The matter proceeded to a

trial in April 2023, at which the videotaped depositions of Gitterman and

Smolen were admitted into evidence. On June 5, 2023, the orphans’ court

entered a decree which adopted the proposed findings of fact and conclusions

of law submitted by Gitterman and Smolen, sustained their objections to the

accounting, and directed that the balance of the Estate be distributed to them.

       The Estate timely appealed, and both the Estate and the orphans’ court

complied with Pa.R.A.P. 1925.3

       The Estate raises the following issues for our review:

       1. Did the [orphans’] court commit reversible error in finding that
          there was a valid and enforceable loan agreement when all the
          evidence indicated that the parties never behaved as though a
          loan agreement existed and the conduct of the parties was
          consistent with a gift to [decedent] that [he] had a choice to
          repay at his own discretion?

       2. In the alternative, assuming this Court determines the
          [orphans’] court did not abuse its discretion in finding a valid
          loan agreement, did the [orphans’] court commit reversible
          error in ignoring the statute of limitations and ordering the
          [E]state . . . to repay money that was given to [decedent] more
          than four (4) years prior to any claims being made?

Estate’s Brief at 4 (unnecessary capitalization omitted).

       Our standard of review of an orphans’ court decree is well-settled:

____________________________________________

3 The Estate filed a four-page concise statement which raised twelve issues.

The orphans’ court determined that the Estate’s issues on appeal were waived
for lack of concision, clarity, and specificity. See Orphans’ Court Opinion,
9/28/23, at 9-11. Nevertheless, the orphans’ court authored an opinion
addressing the issues. We decline to find waiver, and will instead address the
merits of the issues presented for our review.

                                           -5-
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            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.

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

unnecessary capitalization omitted).

     In its first issue, the Estate contends that the orphans’ court erred in

finding the existence of a valid and enforceable loan agreement.        Under

Pennsylvania law, the elements of an enforceable contract are an offer,

acceptance, consideration, and mutual meeting of the minds. See Chilutti v.

Uber Technologies, Inc., 300 A.3d 430, 443 (Pa. Super. 2023) (en banc)

(citation and internal quotation marks omitted).       “An agreement is an

enforceable contract wherein the parties intended to conclude a binding

agreement and the essential terms of that agreement are certain enough to

provide the basis for providing an appropriate remedy.” United Envtl. Grp.,

Inc. v. GKK McKnight, LP, 176 A.3d 946, 963 (Pa. Super. 2017) (citation

omitted).

     Additionally, there must be a “meeting of the minds” for an agreement

to exist. See Accu-Weather, Inc. v. Thomas Broadcasting Co., 625 A.2d

75, 78 (Pa. Super. 1993). As this Court has explained:

            [T]he very essence of an agreement is that the parties

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      mutually assent to the same thing . . .. Without such assent there
      can be no [enforceable] agreement . . .. The principle that a
      contract is not binding unless there is an offer and an acceptance
      is to ensure that there will be mutual assent . . ..

Id. (citation omitted).

      The burden of proving an oral contract is on the party seeking to

establish it. See Boyle v. Steiman, 631 A.2d 1025, 1033 (Pa. Super. 1993).

When construing an oral contract, the words constituting the agreement are

merely parts of and imbedded in a general conversation, and the meaning

must be interpreted with reference to the circumstances under which the

parties contracted in light of the objectives to be accomplished. Id. In cases

involving contracts wholly or partially composed of oral communications, the

precise content of which are not of record, courts must look to surrounding

circumstances and course of dealing between the parties in order to ascertain

their intent. Id.

      “[I]n 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 them

are questions of fact for the [fact finder].” United Envtl. Grp., Inc., 176

A.3d at 963 (citation omitted).    This Court is bound by the trial court’s

credibility determinations. See Keystone Dedicated Logistics, Inc. v. JGB

Enters., 77 A.3d 1, 6 (Pa. Super. 2013). However, the question of whether

an undisputed set of facts establishes a contract is a matter of law.      See

United Envtl. Grp., Inc., 176 A.3d at 963. Consequently, our standard of

review over questions of law is de novo and to the extent necessary, the scope

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of our review is plenary. See Keystone Dedicated Logistics, Inc., 77 A.3d

at 6.

        The Estate contends that the orphans’ court erred in determining that

Gitterman and Smolen were creditors of the Estate because there was no valid

loan agreement between the decedent and either Gitterman or Smolen. The

Estate claims that none of the essential elements of a contract were present

in the communications between the parties. In particular, the Estate asserts

that there was no consideration, no essential terms, and no mutual

agreement, noting that there was no discussion of any remedy if decedent

failed to make repayment, and no written agreement establishing a default

provision.

        The Estate concedes that the decedent sent emails in which he

acknowledged the money he received from Gitterman and Smolen and that

he promised to repay the amounts he received from them with interest and

additional gift money. However, the Estate nevertheless argues that

decedent’s acknowledgement of the money he received and his promises to

make repayment were insufficient to establish a contract. The Estate asserts

the absence of any discussion between the parties regarding an interest rate

on the alleged loans confirms that there was no mutual consideration between

the parties. According to the Estate, any moral satisfaction that Gitterman

and Smolen experienced is not valid consideration. The Estate claims that,

because decedent had no assets and was not working over the course of the

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six years in which the payments were made, Gitterman and Smolen had no

reasonable basis to believe that decedent would ever repay them. The Estate

insists that the fact that Gitterman and Smolen never intended to take any

legal action against decedent establishes that they did not intend for the

payments to be a legally enforceable loan agreement. Instead, the Estate

argues, the transactions at issue were simply gifts made of love and care, with

no expectation of repayment.

      The orphans’ court considered the Estate’s first issue and concluded that

it lacked merit. The court reasoned:

             Decdent and [Gitterman and Smolen] clearly formed a valid
      oral agreement enforceable under Pennsylvania law. Said oral
      agreement was in the form of a demand loan. [Gitterman and
      Smolen] and decedent agreed that [Gitterman and Smolen] would
      lend decedent funds for his basic needs, ie. food and shelter. This
      is corroborated by [Gitterman and Smolen’s] bookkeeping of said
      loans and decedent’s emails to [them] characterizing the funds as
      loans. The evidence presented makes it clear that decedent in
      fact intended to repay [Gitterman and Smolen] and went so far as
      keeping them apprised of his financial status and reassuring them
      that he would make repayment when he was able. [Gitterman
      and Smolen’s] testimony confirms this was their understanding of
      the loan agreement and conditions of repayment. Decedent’s
      ability to return to work and/or have available funds was the
      condition precedent for repayment. The writings corroborate the
      testimony presented and the parties’ understandings of the
      agreement.

                                ****

            The conduct and course of dealing between the parties from
      2012 up until decedent’s death in late 2018 clearly established
      that decedent formed a valid and enforceable oral contract
      between himself and . . . Gitterman and . . . Smolen. As
      mentioned above, . . . Gitterman kept a log of the finances she
      was loaning to decedent and titled said log as “Loans to Freddy

                                     -9-
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     2012 – 2017.” . . . Smolen also kept a log of the finances she was
     loaning decedent.

            As reflected in [the accounts] and corroborated by [the
     correspondence], [Gitterman and Smolen] and decedent
     acknowledged that these funds were in fact a loan and not a gift.
     In fact, it is clear in reviewing the communications between the
     parties that when they intended for a payment to be a gift rather
     than a loan, it was specifically stated as such. At times when
     decedent believed that he would be in a position in the near future
     to make repayment, he requested both . . . Gitterman and . . .
     Smolen’s bank account information in order for him to be able to
     wire funds for repayment to [them].         This is a clear and
     unequivocal acknowledgment of the debt and promise to repay
     said debt. . . . [Gitterman and Smolen] and decedent had a
     mutual understanding of the oral agreement in the form of a
     demand loan, and the terms of the enforceable contract were
     clearly set out between the parties.

                                ****

            Both . . . Gitterman and . . . Smolen had an understanding
     that they would be repaid gift money in addition to the principal
     loans they made to decedent. During her deposition testimony, .
     . . Smolen acknowledged that decedent promised repayment to
     her by repaying “the base of the principal loan that [she made],
     plus a gift in lieu of interest.” During her deposition testimony, .
     . . Gitterman stated that decedent “express[ed] his appreciation
     and he wanted to give some gift money that included the interest.
     It would be over and above the interest.” She further stated that
     decedent promised to “pay back with interest and gift money.”

           These assertions made by decedent and agreed upon by
     [Gitterman and Smolen] clearly establishes a benefit to the
     promisor in return for [Gitterman and Smolen’s] loans made to
     decedent. Therefore, there was consideration in exchange for the
     loans being made to decedent

                                ****

           The abundance of evidence presented by [Gitterman and
     Smolen] clearly reflects that a valid and enforceable agreement
     was entered into by the parties.         Regardless of whether
     [Gitterman and Smolen] contemplated legal action for decedent’s

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     lack of repayment is of no moment. Clearly, [Gitterman and
     Smolen] were aware, as they were being kept updated by
     decedent regularly, that [he] did not have the necessary funds to
     make repayment.       However, [Gitterman and Smolen] kept
     accurate records of the loans being made and worked with
     decedent in attempting to have repayment accomplished when
     decedent made promises to pay.

          Default provisions are not a legal requirement in order to
     determine [that] a contract [is] legal and enforceable. . . .

            . . . The various emails between decedent and [Gitterman
     and Smolen] confirm recognition of the loans and the intention
     that they be loans. Decedent expressly promised to repay the
     loans in his communications with [Gitterman and Smolen]. While
     it is acknowledged that decedent did not repay either [Gitterman
     and Smolen], the condition precedent to him doing so was that he
     would become re-employed and financially stable.            . . .
     Unfortunately, it was not until decedent’s death that he had funds
     that could be used to repay his loans.

Orphans’ Court Opinion, 9/28/23, at 12-16, 18-19, 20-21 (citations to the

record and unnecessary capitalization omitted).

     Based on our review of the record, we conclude that the orphans’ court’s

determination is supported by the record and free of error.     The evidence

presented by Gitterman and Smolen was more than sufficient to meet their

burden of proving the existence of an oral loan contract between Gitterman

and decedent and Smolen and decedent. See Boyle, 631 A.2d at 1033. The

orphans’ court credited the testimony and documentary evidence presented

by Gitterman and Smolen reflecting that decedent regarded the payments as

loans. Indeed, the decedent repeatedly acknowledged via email his receipt of

payments from Gitterman and Smolen, as well as his intention to repay them

in full for those payments, and to pay interest on those amounts as well as an

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additional monetary gift as soon as he was able to do so. That the parties did

not discuss a specific interest rate or the imposition of penalties does not alter

the clear contractual nature of their transactions.      Nor does the fact that

decedent continued to experience financial hardship and was unable to make

any payments to either Gitterman or Smolen prior to his death detract from

the clear intention and agreement of the parties to regard the payments as

loans. Consequently, we conclude that the evidence establishes that there

was   an   offer,    acceptance,   consideration,   mutual   understanding,   and

sufficiently clear terms to provide the basis for an appropriate remedy. See

United Envtl. Grp., Inc., 176 A.3d at 963. Accordingly, the Estate’s first

issue merits no relief.

      In its second issue, the Estate contends that the claims for repayment

asserted by Gitterman and Smolen are barred by the statute of limitations.

Because the applicability of a statute of limitations is a question of law, our

scope of review is plenary and our standard of review is de novo. See Ash v.

Continental Ins. Co., 932 A.2d 877, 879-80 (Pa. 2007).               Statutes of

limitations are rules of law that set time limits for bringing legal claims. See

DiDomizio v. Jefferson Pulmonary Assocs., 280 A.3d 1039, 1046 (Pa.

Super. 2022).       Relevantly, the statute of limitations for an action upon an

express contract not founded upon an instrument in writing is four years. See

42 Pa.C.S.A. § 5525(a)(3).

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      However, the statute of limitations may be tolled if the contract contains

a condition precedent, such as an act or event which triggers the duty to

perform on the contract. See Gurenlian v. Gurenlian, 595 A.2d 145, 150

(Pa. Super. 1991). “[W]here the contract is to pay on the future performance

of a condition . . . or at a certain time after demand, there a demand is

necessary to a right of action and the statute of limitations does not begin

running until a demand is made.” Id. (citation and internal quotation marks

omitted). However, where there is no evidence or testimony in the record

indicating that repayment was conditioned on the occurrence of a condition

precedent or of a demand of repayment, the running of the statute of

limitations is not contingent on a demand being made and, therefore, the

statute is not tolled. See id.

      The Estate argues that, if the payments are characterized as loans, then

any claim for repayment of those loans is barred by the four-year statute of

limitations. According to the Estate, most of the loans were made to decedent

prior to April 1, 2016. The Estate asserts that, because Gitterman and Smolen

did not file their notices of claims against the Estate until April 1, 2020, most

of their claims for repayment are time-barred. The Estate additionally argues

that, because the parties did not expressly condition decedent’s repayment on

any occurrence or the making of a demand by Gitterman and Smolen, they

were required to commence an action against decedent for breach of the loan

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contract within four years of each and every payment that they made to

decedent.

     The orphans’ court considered the Estate’s second issue and determined

that it lacked merit. The court reasoned:

           . . . The oral loan herein is clearly a demand loan, as
     [Gitterman and Smolen] could demand repayment of their loan at
     such time as a condition precedent, or contingency was met.
     Pursuant to [Gitterman and Smolen’s] testimony, there was no
     specific date for repayment to be made. Further, April [1], 2020
     was the first time that [Gitterman and Smolen] made a demand
     for repayment of the loans. The oral loans were demand loans
     where decedent would be required to make repayment upon
     demand by [Gitterman and Smolen] when he obtained the funds
     to be able to make repayment. Pursuant to the statute, the
     statute of limitations required that the tolling of this action be
     accomplished within four years of the making of a demand for
     repayment.

                                ****

            . . . [I]n the instant matter, the oral agreement contained a
     clear condition precedent to decedent’s repayment, which has
     been reflected by the voluminous amount of evidence presented.
     Decedent was to gain employment and a sound financial status
     and then [Gitterman and Smolen] would demand repayment.
     [Gitterman and Smolen] reasonably expected to be repaid and
     relied on decedent’s assertions that he would ultimately be in a
     position to repay them, as he was experienced in the area of law
     and made [Gitterman and Smolen] aware of specific projects he
     was purs[u]ing, as well as potential reimbursements for work to
     be performed.         The contingency was never fulfilled during
     decedent’s lifetime and was only fulfilled following his death, due
     to lawsuit proceeds being available in 2022.

           In the instant case, a demand was necessary for the statute
     of limitations to begin running. . . . [T]here is an abundance of
     evidence in the record which indicates that payment was
     contingent on the occurrence of a condition precedent. Further,
     decedent provided [Gitterman and Smolen] with continuous
     updates as to his financial opportunities and status, confirming his

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      current inability to repay the debt but reassuring [Gitterman and
      Smolen] that he was seeking opportunities to be able to repay the
      outstanding debt. The condition of repayment was that . . .
      Gitterman and . . . Smolen would demand repayment from
      decedent when he would become re-employed and get back on
      his feet financially.

Orphans’ Court Opinion, 9/28/23, at 22-24 (citations to the record and

unnecessary capitalization omitted).

      We discern no error in the orphans’ court’s application of the statute of

limitations to the instant case.   Gitterman and Smolen both testified that

decedent’s repayment of the loans was contingent upon his ability to earn

enough money to repay them or otherwise have sufficient funds to repay

them. That condition precedent never occurred in decedent’s lifetime. When

the Estate obtained the settlement proceeds in the personal injury action, the

condition precedent was met. Gitterman and Smolen then filed their notices

of claims against the Estate, and thereby asserted their demands for

repayment upon the first sign of an ability to pay. As those demands were

made within the applicable four-year statute of limitations, the orphans’ court

did not err in determining that the demands were not barred by section

5525(3). Accordingly, the Estate’s second issue merits no relief.

      Decree affirmed.

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Date: 4/03/2024

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