Court Opinion

ID: 4533306
Source: CourtListenerOpinion
Date Created: 2020-05-11 19:11:28.255559+00
Date Added: 2024-06-11T09:26:48.433778
License: Public Domain

J-A08042-20

                                  2020 Pa. Super. 112

    IN RE: THE ESTATE OF RYAN                  :   IN THE SUPERIOR COURT OF
    WAGNER, A MINOR                            :        PENNSYLVANIA
                                               :
                                               :
    APPEAL OF: RYAN WAGNER                     :
                                               :
                                               :
                                               :
                                               :   No. 848 EDA 2019

              Appeal from the Order Entered February 12, 2019
    In the Court of Common Pleas of Philadelphia County Orphans’ Court at
                         No(s): No. 305MI of 2005

BEFORE: LAZARUS, J., KUNSELMAN, J., and McCAFFERY, J.

OPINION BY McCAFFERY, J.:                                  FILED MAY 11, 2020

       Ryan Wagner (Appellant) appeals from the Philadelphia Court of

Common Pleas Orphans’ Court’s order sustaining preliminary objections and

dismissing his petition alleging breach of fiduciary duty and seeking an

accounting. The Orphans’ Court found that it lacked jurisdiction to grant the

relief sought. This matter presents the question of whether the limited power

to act under 20 Pa.C.S. § 3521 permits courts to reopen estates that have

been discharged because estate investments underperformed. We determine

that Section 3521 does not permit such reopening; thus, we affirm.

       On March 28, 2005, the Orphans’ Court appointed Daniel L. Glennon,

Esquire (Appellee) to serve as plenary guardian of Appellant’s estate;

Appellant was then a minor.1           Appellant reached the age of majority on

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1 The estate arose from a settlement of a wrongful death and survival action
after the death of Appellant’s mother.
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January 20, 2014.     On April 9, 2014, the parties filed a joint petition for

discharge, and on May 8, 2014, the Orphans’ Court granted it. The informal

accounting filed with the petition indicated that the estate was initially worth

$986,539, and had grown to $1,296,381 by the time the petition was filed.

      On December 20, 2018, Appellant filed a petition for breach of fiduciary

duty and an accounting. Appellant sought to claw back certain funds from

Appellee, the appointed guardian, that were spent on two investments that

failed to yield, although the estate as a whole gained in value during the

guardianship. On February 8, 2019, the Orphans’ Court sustained Appellee’s

preliminary objections and dismissed the petition.        On March 14, 2019,

Appellant filed a timely notice of appeal, and on April 5, filed a timely

statement of matters complained of on appeal pursuant to Pa.R.A.P. 1925(b).

      Appellant raises the following issues:

      1.    Did the Orphans’ Court commit a reversible error of law in
      determining that it lacked subject matter jurisdiction over
      Appellant’s Petition for Breach of Fiduciary Duty and an
      Accounting?

      2.    Did the Orphans’ Court abuse its discretion and/or commit
      a reversible error of law in its determination that Appellant did not
      specifically move for relief under 20 Pa.C.S. § 5163?

      3.     Did the Orphans’ Court abuse its discretion and/or commit
      a reversible error of law in its determination that Appellant did not
      sufficiently allege a basis for review of the Decree of Distribution
      in that new matters had arisen, justice and equity so required,
      and that there was an error of law on its face?

      4.    Did the Orphans’ Court commit a reversible error of law,
      where it determined that Appellant did not plead facts sufficient
      to establish a basis for surcharge?

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Appellant’s Brief at 4.

        In its opinion, the Orphans’ Court points out that the order of May 8,

2014 was a final order, and thus the doctrine of res judicata applied. Trial Ct.

Op., 4/26/19, at 4. The only exception that would allow the Court to exercise

jurisdiction is 20 Pa.C.S. § 3521.2 Section 3521 allows a party in interest to,

within five years of final confirmation of a personal representative’s account,

file a petition to review. 20 Pa.C.S. § 3521.

        “[A]n order confirming an account and ordering distribution of an estate

becomes final when no appeal is timely filed therefrom. The failure to appeal

from a final order renders the doctrine of res judicata applicable.”      In re

Estate of Karschner, 919 A.2d 252, 256 (Pa. Super. 2007) (quotation

omitted). “[T]here is no authority for the proposition that a party may raise

an issue of which he knew prior to final adjudication, by way of petition to

review under section 3521.” In re Litostansky’s Estate, 453 A.2d 329, 331

(Pa. 1982). A surcharge cannot be imposed for a mere error in judgment;

rather, it is imposed to compensate the beneficiaries for loss of estate assets

due to the fiduciary’s failure to meet his duty of care. In re Estate of Westin,

874 A.2d 139, 144 (Pa. Super. 2005).

        Review of a confirmed account is generally restricted to scenarios where

“(1) there are errors of law appearing on the face of the record; (2) new

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2   Section 3521 applies to minor’s estates, per 20 Pa.C.S. § 5163.

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matter has arisen since the confirmation of the account or decree; or (3) . . .

justice and equity require a review and no person will suffer thereby.” In re

Jones, 660 A.2d 76, 80 (Pa. Super. 1995) (citation omitted). The findings of

the trial court, as a chancellor in equity, will not be disturbed “absent manifest

error; we may modify the decree only if the findings upon which the decree

rests are unsupported by the evidence or if there has been an error of law, an

abuse of discretion or a capricious disbelief of competent evidence.” Id. at

79.

       Appellant argues that “new matter” has emerged in the form of new

information about the poor-performing investments, including that a life

insurance policy was term only, and thus if the insured person outlived the

term, the investment would be a total loss.3 Appellant’s Brief at 23. Appellant

also claims that a mortgage held by the estate was only disclosed after final

accounting to have been a third mortgage, and thus subordinate to others.
Id. at 24. Appellant further claims that equity and justice support review, and

that the Orphans’ Court erred in basing its discharge on an informal and

incomplete account, thereby meeting the “error of law on the face of the

record” requirement. Id. at 24-27.       Appellant concedes that Appellee

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3 The insured person does not appear to be directly related to any parties to
this litigation; the policy was an investment opportunity, similar to a viatical
investment.

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consulted with him and his father during the guardianship about the

investments Appellant now contests. Id. at 8-9.

       Appellee argues that the Orphans’ Court correctly found its jurisdiction

to be largely extinguished when no appeal was filed from the May 2014 order

discharging him as guardian. Appellee’s Brief at 10-11. Appellee points out

that the estate as a whole generated significant income during his

stewardship. Id. at 5, 19. He also contends that he explained in a letter,

dated May 25, 2011, and addressed to Appellant’s father, that the life

insurance policy had a payout that was temporally limited and thus would yield

only if the insured person died between the specified dates. Id. at 5.

       Plainly, the contested investments did not work out as Appellant would

have wished.      That is not enough, however, to open an account that was

entered upon a joint petition filed by Appellant and Appellee, to end Appellee’s

guardianship and vest Appellant with full control over his investments. We

reiterate that most of the investments earned significant income during

Appellee’s term as guardian.4           The Orphans’ Court correctly applied res

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4
  We make no comment about the efficacy or propriety of the investments
made by the guardian. The time to have raised those issues was at the audit
of the account. See Pa.O.C.R. 2.7(a) (“Objections to an Account . . . shall be
filed with the clerk on or before the time and date of the audit in those counties
holding an audit, and by a specified date in all other counties . . . .”). When
an adult has the benefit of an accounting and signs off on it, without any proof
of coercion or fraud, the auditing judge must assume that the late minor has
no objection and is in fact satisfied with the accounting prepared by the

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judicata and limited its inquiry due to the constrained nature of the Section

3521 lens, and correctly determined that preliminary objections should be

granted and the petition dismissed because Appellant did not plead sufficient

facts to establish jurisdiction under Section 3521. Thus we affirm.

       Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 5/11/20

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guardian. See Pa.O.C. Rule 2.5(h)(4). A change of heart does not provide
cause for a petition for review.

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