Court Opinion

ID: 9366697
Source: CourtListenerOpinion
Date Created: 2023-01-27 18:08:11.177644+00
Date Added: 2024-06-11T17:15:54.568604
License: Public Domain

J-S42018-22

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

    IN RE: ESTATE OF ANGELA                    :   IN THE SUPERIOR COURT OF
    DIMATTEO                                   :        PENNSYLVANIA
                                               :
                                               :
    APPEAL OF: CASIMIRO DIMATTEO               :
                                               :
                                               :
                                               :
                                               :   No. 362 WDA 2022

                 Appeal from the Order Entered March 2, 2022
      In the Court of Common Pleas of Allegheny County Orphans' Court at
                           No(s): No. 02-18-6412

BEFORE:      BOWES, J., OLSON, J., and COLINS, J.*

MEMORANDUM BY OLSON, J.:                             FILED: JANUARY 27, 2023

        Appellant, Casimiro DiMatteo, appeals from an order entered on March

2, 2022, setting aside a conveyance of real property from the estate of Angela

DiMatteo, Appellant’s mother, following the removal of Appellant as executor.

We affirm.

        We briefly set forth the facts and procedural history of this case as

follows. On September 25, 2013, Angela DiMatteo executed a last will and

testament naming Appellant as executor of her estate. The will further stated

that, should Appellant be unable to serve as executor, then his wife, Silvia

Collucio DiMatteo, should serve in his stead.        On October 5, 2018, Angela

DiMatteo died. On October 18, 2018, letters of testamentary were issued to

Appellant. On December 12, 2019, Annina Radakovich DiMatteo, one of the

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*   Retired Senior Judge assigned to the Superior Court.
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other heirs to Angela DiMatteo’s estate, filed a petition to compel Appellant to

file an accounting of the estate. Thereafter,

      [a]lmost a year later, during a conference with the orphans' court,
      the parties reached a consent order, dated January 20, 2021, and
      recorded January 25, 2021. In relevant part, it required that
      Bodnar Real Estate perform an appraisal of the real estate at 412
      Pearl Street, Pittsburgh, Pennsylvania (“Pearl Street property”)
      within 30 days. Additionally, [Appellant] was to file state and
      federal fiduciary tax returns within 30 days after he received the
      last 1099 for estate income, receipt of which was to be provided
      to all counsel. [Appellant] was then to file a formal first and final
      account within 30 days after the tax returns were filed.

      On February 12, 2021, before [the arrival of Appellant’s deadline]
      to comply with that order, Annina filed an emergency petition to
      remove [Appellant] as executor. Annina claimed that [Appellant]
      failed to adhere to the terms of the consent order, filed a
      $180,000[.00] claim with the estate for caretaking services,
      transferred the Pearl Street property from the estate to his wife
      and children for one dollar, and filed a claim for an executor's fee.
      Additionally, as a result of [Appellant’s] actions and failure to
      adhere to legal advice, his counsel sought permission to withdraw.
      [Appellant] filed a pro se response to Annina's petition.

      On February 19, 2021, the orphans' court granted counsel's
      request [to withdraw].     Following a hearing on Annina's
      emergency petition, the court also revoked the letters
      testamentary issued to [Appellant] and directed that Warner
      Mariani, Esquire, be appointed administrator of the Estate of
      Angela DiMatteo upon proper application to the Wills Division of
      the Allegheny County Department of Court Records.

      Notably, the orphans' court bypassed the substitute executrix
      named in Ms. DiMatteo's Will, [Appellant’s] wife Sylvia, because
      of her participation in [the transfer of] property from the estate to
      herself and [her] children.

In re Est. of DiMatteo, 272 A.3d 486, at *1-2 (Pa. Super. 2022)

(unpublished memorandum).

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      Appellant challenged his removal as executor in a prior appeal to this

Court. Ultimately, we affirmed Appellant’s removal as executor and approved

the appointment of Attorney Mariani as successor. See id. More specifically,

and important to the current appeal, this Court determined:

      Shortly after issuance of the consent order, [Appellant] sent a
      family settlement agreement to the other beneficiaries proposing
      to distribute the remaining Estate assets, apparently to resolve
      [the distribution of the estate] informally. He filed a status report
      indicating that the administration of the Estate was complete. He
      did this despite being directed by the orphans' court to obtain an
      appraisal of the Pearl Street property and to file a formal account.

      Additionally, [Appellant] created a substantial conflict of interest
      with his fiduciary duties as executor of the Estate, when he
      claimed the Estate owed him $180,000[.00] for taking care of his
      mother prior to her death.

                           *           *            *

      Furthermore, [Appellant] engaged in self-dealing by paying his
      caretaking claim out of the Estate and transferring the Pearl Street
      property to his wife and children. We [] therefore conclude[d] that
      the trial court did not abuse its discretion in removing [Appellant]
      as executor of the Estate.

                           *           *            *

      [Moreover], the orphans' court explained that Silvia clearly was
      aligned with her husband by advancing his position that he was
      entitled to payment for caretaker services and accepting the
      transfer of the property. [Appellant] had conveyed a valuable
      parcel of real estate from the estate to his wife and children for
      the nominal consideration of one dollar. Silvia's participation in
      that conveyance severely compromised her fitness to serve as a
      successor executrix.

Id. at *3 (quotations, case citations, and original brackets omitted).        No

further appeal resulted.

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       On December 21, 2021, Attorney Mariani, as successor executor, filed

a petition to revoke the conveyance of the Pearl Street property to Appellant’s

wife, Silvia DiMatteo, and their two children, Enrico DiMatteo and Rosella

DiMatteo. On March 1, 2022, the trial court held a hearing on the petition to

revoke. At that hearing, Appellant did not testify and, instead, invoked his

right against self-incrimination under the Fifth Amendment of the United

States Constitution. Silvia DiMatteo, Enrico DiMatteo, and Rosella DiMatteo

also attended the hearing, but did not testify or otherwise present evidence.

On March 2, 2022, the trial court entered an order voiding the sale of the Pearl

Street property to Silvia DiMatteo, Enrico DiMatteo, and Rosella DiMatteo.

This appeal resulted.1

       On appeal, Appellant presents the following issues for our review:

        I.    Whether the trial court’s order revoking the conveyance of
              real [] property by Appellant[,] who[] is the former executor
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1  Appellant filed a notice of appeal on March 31, 2022. On April 7, 2022, the
trial court directed Appellant to file a concise statement of errors complained
of on appeal pursuant to Pa.R.A.P. 1925(b). Appellant complied timely on
April 27, 2022. The trial court issued an opinion pursuant to Pa.R.A.P. 1925(a)
on May 31, 2022.

Silvia DiMatteo, Enrico DiMatteo, and Rosella DiMatteo, in their own right,
appealed the March 2, 2022 order voiding the sale of the Pearl Street property.
That appeal is docketed at 363 WDA 2022. The trial court issued a separate
opinion pursuant to Pa.R.A.P. 1925(a) on May 31, 2022, that specifically
addressed the issues pertaining to Silvia, Enrico, and Rosella DiMatteo.

Finally, we note that upon review of the certified record, the trial court
subsequently approved the sale of the Pearl Street property to an independent
third-party by order entered on May 18, 2022. Neither Appellant nor his wife
and/or two children appealed that decision.

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              of the estate[,] constituted a surcharge action2 and was
              entitled to an accounting of the estate?

       II.    Whether the trial court erred as a matter of law and abused
              its discretion when it issued an order revoking the
              conveyance of real property because it failed to give []
              Appellant an opportunity to be heard [and precluded]
              Appellant [from presenting evidence]?

      III.    Whether the order revoking the conveyance of real property
              constituted a denial of the claim [] Appellant filed against
              the estate for services provided to the estate?3

Appellant’s Brief at 5 (complete capitalization omitted).

       In his first issue presented, Appellant argues, in sum:

       Here, the [t]rial [c]ourt voided the real estate transfer made by []
       Appellant that was settlement for a claim [] Appellant had against
       the estate. Thus, after the revocation of the deed [of] transfer of
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2   Surcharge is a remedy when an executor fails “to exercise common
prudence, skill and caution in the performance of [his] fiduciary duty, resulting
in a want of due care.” In re Est. of Warden, 2 A.3d 565, 573 (Pa. Super.
2010), citing In re Miller's Estate, 26 A.2d 320, 321 (Pa. 1942) (defining
“surcharge” as “the penalty for failure to exercise common prudence, common
skill and common caution in the performance of the fiduciary's duty ...
imposed to compensate beneficiaries for loss caused by the fiduciary's want
of due care”); see also In re Paxson Trust I, 893 A.2d 99, 120–121 (Pa.
Super. 2006) (“a surcharge was viewed not as compensation for any possible
loss, but as punishment for the fiduciary's improper conduct”). “[A] fiduciary
who has negligently caused a loss to an estate may properly be surcharged
for the amount of such loss.” In re Scheidmantel, 868 A.2d 464, 494 (Pa.
Super. 2005). “Before the court can impose a surcharge, it must give the
executor an opportunity to be heard.” In re Est. of Westin, 874 A.2d 139,
145 (Pa. Super. 2005), citing In re Stitzel's Est., 70 A. 749, 750 (Pa. 1908)
(“A surcharge is an adjudication against the accountant which cannot be made
without notice to him and an opportunity to be heard before he is
condemned.”).

3 Appellant concedes that “this [third] issue is deemed moot as [] Appellant
may still pursue a claim against the estate.” Appellant’s Brief at 16. As such,
we need not address this claim.

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      real property, the [e]state has been unjustly enriched. The
      [e]state has received the benefit of care services for
      approximately four years and has not had to pay for the benefit
      of receiving those services. Therefore, by voiding the transfer of
      real estate [which was] part of the settlement for services, [the
      orphans’ court order] constituted a surcharge action against []
      Appellant.

      Here, [] Appellant provided care services and detrimentally relied
      on the payment for his services. Now that his conveyance has
      been revoked, [] Appellant had [the] value of services provided
      stripped from him and his compensation for those services has
      been taken away from him. Thus, such actions constitute a
      surcharge.

Id. at 12.

      We adhere to the following 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 [whether] the trial 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, this
      Court will not reverse the trial court's credibility determinations
      absent an abuse of discretion.

In re Est. of Aiello, 993 A.2d 283, 287 (Pa. Super. 2010) (citations omitted).

      Our Supreme Court has explained that “the power to set aside” an estate

administrator’s sale of real property “is delimited by Section 3360” of the

Probate, Estates and Fiduciaries Code. Est. of Bosico, 412 A.2d 505, 506

(Pa. 1980), citing 20 Pa.C.S.A. § 3360. More specifically, under Section 3360:

      (a) Inadequacy of consideration or better offer.--When a personal
      representative shall make a contract not requiring approval of
      court, or when the court shall approve a contract of a personal
      representative requiring approval of the court, neither inadequacy
      of consideration, nor the receipt of an offer to deal on other terms
      shall, except as otherwise agreed by the parties, relieve the
      personal representative of the obligation to perform his contract
      or shall constitute ground for any court to set aside the contract,

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      or to refuse to enforce it by specific performance or otherwise:
      Provided, That this subsection shall not affect or change the
      inherent right of the court to set aside a contract for fraud,
      accident or mistake. Nothing in this subsection shall affect
      the liability of a personal representative for surcharge on
      the ground of negligence or bad faith in making a contract.

20 Pa.C.S.A. § 3360(a) (emphasis added). “[A]bsent a showing of fraud, if

an administrator fails to comply with his fiduciary duties in a manner

evidencing neglect or bad faith, the remedy of surcharge is available under

Section 3360.”    Est. of Bosico, 412 A.2d at 507.        “The intent of the

legislature in enacting this statute was to prevent courts from [assuming] the

position of [a] super executor/administrator, and to leave essentially private

transactions in the hands of the individuals involved.” In re Est. of Hughes,

538 A.2d 470, 472 (Pa. 1988) (citation omitted).

      This Court has further explained:

      An executor, as a fiduciary of the estate, is required to use such
      common skill, prudence and caution as a prudent man, under
      similar circumstances, would exercise in connection with the
      management of his own estate. [….A] surcharge may be imposed
      on the executor to compensate the estate for any losses incurred
      by the executor's lack of due care. When seeking to impose a
      surcharge against an executor for the mismanagement of an
      estate, those who seek the surcharge bear the burden of proving
      the executor's wrongdoing.       However, where a significant
      discrepancy appears on the face of the record, the burden shifts
      to the executor to present exculpatory evidence and thereby avoid
      the surcharge.

In re Est. of Geniviva, 675 A.2d 306, 310–311 (Pa. Super. 1996) (internal

citations and quotations omitted).

      Whereas,

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      this Court has recognized the rule forbidding an executor from
      placing his own interests ahead of the interests of other
      beneficiaries:

         An executor is a fiduciary no less than is a trustee and, as
         such, primarily owes a duty of loyalty to a beneficiary of his
         trust. Executors, as well as other fiduciaries, are under an
         obligation to make full disclosure to beneficiaries respecting
         their rights and to deal with them with utmost fairness.

      The Supreme Court has elaborated accordingly that:

         He that is entrusted with the interest of others, cannot be
         allowed to make the business an object of interest to
         himself; because from the frailty of nature, one who has the
         power will be too readily seized with the inclination to use
         the opportunity for serving his own interest at the expense
         of others for whom he is entrusted.

      Thus, the rule forbidding self-dealing serves both to shield the
      estate and its beneficiaries and ensures the propriety of the
      executor's conduct. Consequently, the rule is inflexible, without
      regard to the consideration paid, or the honesty of intent.

In re Est. of Walter, 191 A.3d 873, 881 (Pa. Super. 2018) (internal

quotations, citations, and original brackets omitted).

      “Where there is self-dealing on the part of a fiduciary, it is immaterial

to the question of his liability in the premises whether he acted without

fraudulent intent or whether the price received for his sale of trust property

was fair and adequate.” In re Noonan's Est., 63 A.2d 80, 84 (Pa. 1949)

(citation omitted).    “[T]he situation is no different where the breach consists

of the fiduciary's marked preference of a third person over the beneficiary in

respect of a disposition of estate property.”          Id.   “As in the case of

self-dealing, such conduct constitutes a violation of the fiduciary's basic duty

to the beneficiary.”    Id.   (citation omitted).   “In the case of an offending

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fiduciary, if the trust property which he improperly sold is held by or for him,

the remedy is a direct setting aside of the sale upon attack by one having

standing to complain, e.g., a testamentary beneficiary or cestui que trust.”

Id. (citation omitted; emphasis added).

      Within the context of a prior appeal, this Court determined that

Appellant’s conveyance of the Pearl Street property to his wife and children

for nominal consideration constituted an act of self-dealing and, thus, a breach

of his duties to other beneficiaries of the estate.        The orphans’ court

acknowledged this determination as the law of the case in the proceedings

that led up to this appeal wherein the property transfer was revoked. This

Court has previously explained the law of the case doctrine as follows:

      The law of the case doctrine refers to a family of rules which
      embody the concept that a court involved in the later phases of a
      litigated matter should not reopen questions decided by another
      judge of that same court or by a higher court in the earlier phases
      of the matter.... The various rules which make up the law of the
      case doctrine serve not only to promote the goal of judicial
      economy ... but also operate (1) to protect the settled
      expectations of the parties; (2) to insure uniformity of decisions;
      (3) to maintain consistency during the course of a single case; (4)
      to effectuate the proper and streamlined administration of justice;
      and (5) to bring litigation to an end.

      Thus, under the doctrine of the law of the case,

         when an appellate court has considered and decided a
         question submitted to it upon appeal, it will not, upon a
         subsequent appeal on another phase of the case, reverse its
         previous ruling even though convinced it was erroneous.
         This rule has been adopted and frequently applied in our
         own [Commonwealth]. It is not, however, inflexible. It does
         not have the finality of the doctrine of res judicata. “The
         prior ruling may have been followed as the law of the case
         but there is a difference between such adherence and res

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         judicata; one directs discretion, and the other supercedes
         [sic] it and compels judgment. In other words, in one it is
         a question of power, in the other of submission.” The rule
         of the “law of the case” is one largely of convenience and
         public policy, both of which are served by stability in judicial
         decisions, and it must be accommodated to the needs of
         justice by the discriminating exercise of judicial power.

Neidert v. Charlie, 143 A.3d 384, 390–391 (Pa. Super. 2016) (internal

citations omitted).

      In this case, the trial court opined:

      [Appellant] maintains that the action which properly should have
      been taken by the court was a surcharge rather than a revocation
      of the transfer of title. That argument disregards the complicity
      of [Appellant] and his wife, to whom the property was transferred.
      As the Superior Court has already determined in its opinion filed
      on January 19, 2022, Silvia was cognizant of [Appellant’s] conduct
      and was complicit in the illicit transfer. In such circumstances,
      the impropriety is not fully addressed by a surcharge; the
      transaction must be deemed void.

                           *            *            *

      The Superior Court has observed that: “[Appellant] created a
      substantial conflict of interest with his fiduciary duties as executor
      of the [e]state when he claimed the [e]state owed him
      $180,000.00 for taking care of his mother prior to her death. An
      executor has ‘a duty to see that her purely private interests were
      not advanced at the expense of the estate.’”

                           *            *            *

      [Moreover, Appellant] asserts that the court erred and abused its
      discretion when it unjustly enriched the estate by revoking the
      transfer of the deed. To the extent that that complaint is again
      referencing forgiveness of the purported $180,000[.00] claim of
      [Appellant] and is asserting that such forgiveness enriched the
      estate but provided no quid pro quo to [Appellant], the contention
      remains unconvincing.       Voiding the transaction does not
      necessarily preclude a reassertion of the claim during the
      pendency of the estate.

Trial Court Opinion, 5/31/2022, at 1-3.

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      Having already determined, in a prior appeal, that Appellant engaged in

self-dealing by paying his alleged caretaking claim out of the estate and

transferring the Pearl Street property to his wife and children and that this

conveyance constituted a substantial conflict of interest with his fiduciary

duties as executor of the estate, we discern no trial court abuse of discretion

in setting aside the property sale.      We are bound by the prior panel’s

determinations under the law of the case doctrine.        Through self-dealing,

Appellant’s conduct constituted a violation of his basic duty as fiduciary to the

beneficiaries. Therefore, as set forth at length above, the proper remedy was

to set aside the property sale. Finally, we note that the orphans’ court never

ordered Appellant to pay a penalty as punishment for improper fiduciary

conduct.    Accordingly, we reject Appellant’s suggestion that the court’s

remedy constituted a surcharge. Hence, Appellant is not entitled to relief on

his first claim.

      Next, Appellant argues that he “is entitled to a hearing because the

action involved a surcharge action and [] Appellant never had an opportunity

to be heard during a formal surcharge hearing.”        Appellant’s Brief at 13.

Appellant claims that the trial court based its decision “solely []upon a false

assertion that the settlement claim by [] Appellant had already been decided

previously” when he was removed as executor and that the successor

administrator “presented no other evidence[.]” Id. at 15. Appellant claims

that he was entitled to “a formal surcharge hearing” and, as a result, the trial

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court “erred as a matter of law and fact because it abused its discretion when

it issued an order revoking the conveyance of real property and didn’t give []

Appellant an opportunity to be heard.” Id. at 15-16.

      We adhere to the following standards:

      A question regarding whether a due process violation occurred is
      a question of law for which the standard of review is de novo and
      the scope of review is plenary. Due process requires that the
      litigants receive notice of the issues before the court and an
      opportunity to present their case in relation to those issues. It is
      well settled that procedural due process requires, at its core,
      adequate notice, opportunity to be heard, and the chance to
      defend oneself before a fair and impartial tribunal having
      jurisdiction over the case.

Int. of S.L., 202 A.3d 723, 729 (Pa. Super. 2019) (internal citations and

quotations omitted”). “Due process requires only that a party be provided an

opportunity to be heard; it does not confer an absolute right to be heard.”

Captline v. County of Allegheny, 718 A.2d 273, 275 (Pa. 1998) (citations

omitted).

      Appellant’s second claim presumes that the revocation of the transfer of

the Pearl Street property constituted a surcharge action and that, within the

context of such a proceeding, he was entitled to, but denied, certain

procedural rights such as notice, opportunity to be heard, and the chance to

present evidence. As set forth above, we have rejected Appellant’s suggestion

that a surcharge was imposed or that surcharge was the appropriate remedy

for the improper sale of the property at issue. Furthermore, as the trial court

properly observed, “[o]n March 1, 2022, [Appellant] was given the opportunity

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to present testimony regarding his claim and conduct as [e]xecutor” but,

instead, “invoke[ed] his right against self-incrimination under the Fifth and

Fourteen Amendments to the Constitution of the United States, declin[ing] to

testify regarding either matter.”          Trial Court Opinion, 5/31/2022, at 6.

Further, the orphans’ court opined that Appellant’s argument “that he had

been denied an opportunity to be heard [] would be seen to be in conflict with

his filing of a thirty-eight[-]page response, inclusive of exhibits, in advance of

the March 1[, 2022] hearing and his subsequent assertion of a right not to

testify at the hearing.”      Id.   Upon review, we agree with the trial court’s

assessment. Appellant was given the opportunity to be heard at the March 1,

2022 hearing, which was convened on the successor administrator’s petition

to revoke the conveyance of the Pearl Street property. There is no dispute

that Appellant received notice of the issues before the court, the proposed

revocation of the property sale, and was given an opportunity to present his

case in relation to those issues but, ultimately, he invoked his right not to

testify and did not avail himself of the opportunity to contest the

administrator’s contentions.          See N.T., 3/1/2022, at 20.     Accordingly,

Appellant is not entitled to relief.4

       Order affirmed.

____________________________________________

4  We express no opinion regarding the merits of Appellant’s claim against
the estate for caretaking services.

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Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 1/27/2023

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