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HomeMy WebLinkAbout02-0777 IN THE COURT OF COMMON PLEAS ORPHANS` COURT DIVISION ~- CUMBERLAND COUNTY, PENNSYLVANIA In Re: Trust Under Will of George Bergner No . -~-- a 4 - Oa _" "~ ...t "~ ORDER FOR TERMINATION OF TRUST ae.~ua.-~.7..-==--,.~ - ---- -- .,~, Under Will of e On consideration of the Petition and the evidence offered in support of the Petition, the Court finds: 1. Notice of the hearing on the Petition has been duly and regularly given as required by law. 2. All other facts set forth in the Petition are true and correct. 3. The fair market value of the principal of the trust I created under the Last Will and Testament of George Bergner is so low in relation to the costs of administration that the Court i.s satisfied that the original purpose of the conveyor (testator} cannot be carried out or is impractical of fulfillment and that the termination more nearly approximates the intention of the conveyor (testator). 4. All income and remainder beneficiaries have consented to the termination of the Trust and the distribution of the accumu-- lated income and principal of the Trust as proposed in the Petition. NOW, THEREFORE, IT IS ORDERED THAT: 1. The Trust created under the Last Will and Testament of George Bergner, date of death July 7, 1957, is terminated. 2. Wachovia Bank, N.A., as Trustee, is authorized and directed to distribute Sixty-two percent (62%) of the accumulated income and principal of the Trust to Virginia B. Taylor; and Thirty-eight percent (38%) of the accumulated income and princi- pal of the Trust to the Pediatric Care Fund of the PinnacleHealth Foundation. 3. Upon receipt of an acknowledgment of receipt of trust assets by Virginia B. Taylor and PinnacleHealth Foundation, and the preparation and filing of income tax returns for the final fiscal year of the Trust, including tax information notices to both beneficiaries, Wachovia Bank, N.A. is discharged from all of its duties and responsibilities as Trustee of the George Bergner Trust Under Will. Dated: ~Q r ~~'~ BY THE COURT r w IN THE COURT OF COMMON PLEAS ORPHANS` COURT DIVISION CUMBERLAND COUNTY, PENNSYLVANIA ~~~-4~+~~ obi- Oo? --111 In Re : No . -~6~- _ Trust Under Will of George Bergner PETITION TO TERMINATE TRUST TO THE HONORABLE, THE JUDGES OF SAID COURT: Virginia B. Taylor (the "Petitioner"), by her attorneys, Keefer, Wood, Allen and Rahal, LLP, brings this petition for termination of the testamentary trust of George Bergner (the "Trust"), and for an order for final distribution of the Trust, and respectfully alleges as follows: 1. The Petitioner is a beneficiary of a trust created under the Last Will and Testament of her father, George Bergner (the "Decedent"), who died on July 7, 1957. She is identified in the Will as Anna Virginia Bergner. 2. Wachovia Bank, N.A. is the successor by merger to Capital Bank and Trust Company (later known as Hamilton Bank, then Corestates Bank, N.A., then First Union National Bank, successors by merger), the Trustee named in the Last Will and Testament of the Decedent. 3. A copy of the Last Will and Testament of the Decedent, dated March 30, 1953 (the "Will"), is attached hereto as Exhibit A and incorporated herein by this reference. The Will was probated in Cumberland County, Pennsylvania, and this Court retains jurisdiction over the Trust created by the Will. See 20 Pa.C.S. §711 (relating to jurisdiction); 20 Pa.C.S. §722 (relating to venue); and 20 Pa.C.S. §723 (relating to situs of a testamentary trust). 4. Under the terms of the Will, the Petitioner's mother, Della J. Bergner, was entitled to receive the net income of the Trust for as long as she lived; and after the death of the Petitioner`s mother (which occurred on June 9, 1992), the Petitioner became entitled to receive the net income of the Trust for as long as she lives. 5. The Trustee is also authorized to make discretionary distributions of trust principal to Petitioner, for her care, comfortable maintenance, and education, for as long as she lives. 6. Upon the death of the Petitioner, should she die without issue, the net income from the trust estate is to be paid in perpetuity to the Harrisburg Hospital, Harrisburg, Pennsylvania, for the special care of children under the age of fifteen (15) - 2 - years. 7. Petitioner (date of birth June 9, 1943) has no children, and believes, and therefore avers, that she will not bear or adopt children during her lifetime. 8. The current fair market value of the Trust, as of June 30, 2002, is $66,233.75, and consists of money market funds, taxable fixed income funds and equity funds. 8. By letter dated July 19, 2001 (a copy of which is attached hereto as Exhibit B), the Trustee notified the Petitioner that it was going to begin charging a minimum annual fee of $2,000 to administer the Trust. 9. Section 6102 of the Probate, Estates and Fiduciaries Code (20 Pa.C.S. X6102) authorizes the Court with jurisdiction of a trust to order the termination of a trust if the court, after a hearing, is satisfied that the original purpose of the conveyor (testator) cannot be carried out or is impractical of fulfillment and that the termination more nearly approximates the intention of the conveyor, and notice is given to all parties in interest or their duly appointed fiduciaries. 10. The fair market value of the principal of the Trust has become so low in relation to the costs of administration that - 3 - continuation of the Trust under its existing terms will defeat or substantially impair the accomplishment of the Trust purpose. 11. Petitioner believes, and therefore avers, that, due t:o the imposition by Trustee of its minimum annual fee of $2,000, the costs of administration of the Trust will consume a substantial portion of the income generated by the Trust in each year of its administration, thereby depriving her of the level of income previously available for her support. 12. Petitioner believes, and therefore avers, that, following her death, the costs of administration of the Trust will continue to consume a substantial portion of the income generated, thereby depriving the intended charitable beneficiaries of a meaningful source of support. 13. Petitioner believes, and therefore avers, that the Decedent's intent in establishing the Trust will best be served by terminating the trust and distributing the principal and any accumulated income according to the formula for determining the present value of a life estate and remainder, assuming a life tenant aged 59, and the "Applicable Federal Rate" under Internal Revenue Code Section 7520 for August, 2002, for determining the present value of an interest for life, namely 5.2%. As such, the - 4 - Petitioner would be entitled to receive Sixty-two percent (62%) of the accumulated income and principal, and the charitable remainderman would receive Thirty-eight percent (38%) of the accumulated income and principal. 14. The Petitioner requests that the charitable remainder_ be distributed to the Pediatric Care Fund of the PinnacleHealth Foundation, which funds inpatient and outpatient treatment and services provided to pediatric patients at PinnacleHealth Hospitals, since charitable bequests designated for Harrisburg Hospital are now received by the PinnacleHealth Foundation. 15. The written consent and joinder of PinnacleHealth Foundation is attached hereto as Exhibit C. 16. Pursuant to 20 Pa.C.S. §6102, and Orphans' Court Rule 5.3, the Petitioner will provide, at least ten (10) days before the time set for the hearing on this petition, notice of the time and place of the hearing to the following-named parties in interest: Charles R. Hall Vice President Wachovia Bank, N.A. P.O. Box 3226 Lancaster, PA 17604 - 5 - Christopher Markley Gifts and Endowments PinnacleHealth Foundation P.O. Box 8700 Harrisburg, PA 17105-8700 John L. Downing, Esq. Deputy Attorney General Charitable Trusts and Organizations Section Office of the Attorney General of the Commonwealth of Pennsylvania 14th Floor, Strawberry Square Harrisburg, PA 17120 WHEREFORE, Petitioner requests that this Honorable Court, after such hearing as the Court deems necessary, issue an Order terminating the Trust under Will of George Bergner in its entirety, and directing that Sixty-two percent (62%) of the accumulated income and principal be distributed to Petitioner a:nd Thirty-eight percent (38%) of the accumulated income and principal be distributed to the Pediatric Care Fund of PinnacleHealth Foundation; and further, that upon receipt of the trust assets by the beneficiaries, and the preparation and filing of income tax returns for the final fiscal year of the Trust, that this Honorable Court issue an Order discharging Wachovia Bank, N.A. from all of its duties and responsibilities as Trustee of the Trust Under Will of George Bergner; and such other and - 6 - further Orders as the Court considers proper. Respectfully Submitted, Date : ~, 7i a~~ ~~ Bridget M. Whitley, sq. Sup. Ct. I.D. No. 33580 Keefer, Wood, Allen & Rahal, LLP P.O. Box 11963 Harrisburg, PA 17108-1963 (717) 255-8027 Attorney for Petitioner I verify that the statements and correct. I understand that f subject to the penalties of 18 Pa falsification to authorities. Date . D ~~~(~ ~(} Z~ made in this Petition are true alse statements herein are made .C.S. §49,04, relating to unswo;rn Virginia B . Taylo ,.: Formerly known as Anna Virginia Bergner - 7 - ^ ,..,~,..~e I, (fS08i~ BliffiIItA, of Silwow Sprlsg lOwaahip~ Ouaberland Couritya YeaaaTlvaala, being of sound •nd disposing aired, seaor~r and uiWerslanding, de sake, uttea and publish this ay last will and testaaeat, hereby revoMag all toraer wills by as heretofore aade. (1). Z order and direot that ail sy just debts sad funeral ez8saees, inoluding the ooata of •dainistratioa of my estate, shall be tally paid and satisfied b7 a7 mcNntriz and Bzeoutor~ hers- inattet naaed~ as soon.aa oonveniently aaT N after a7 d~ooase. ~~~). I giro anQ bequeath that part of ay parsons] •atats, oonsisting of autostobilea, ohsttels, jewelry, furniture, olothing, and ether personal effeots, (but not inoluding w sh, bonds, stook oertiticatea •videnoes of indebtedness, or interest, or the like), to my dfe, Dells i. Bergner, her heirs and assigns forever. (3)• Z giv• and bequeath unto my aforesaid wife, Della J. Bergner, the swa of five thousand (x$.000.00) dollars] the sage to be paid to her •a soon as oom-saient. ()1). Z give and devise unto sy aforesaid wife, -Della J. Bergner, her heirs and assigns, ay fare, upon whioh we reside, ]mown as Qwynnie Springs Farm, Sliver Spring Township, Cuabsrland Caunty, aforesaid ooatpriaing about 112 •oree, together with the dwelling house, tars, and all other bnildinga thereon •reoted, and inoluding tarn stook, orops, Fars aaohinery and implesents. (5). The bequests and de~lae •nuserated in Paragraphs 2, 3, •nd 4 preoeding are oonditioaed upon the feat that sy wits surviTes ae. Should she predeoease ae, then and in that event said bequests and devia• shall tall •nd ]apes, sad the property hersinbetore bsquesthed and de~is'ed L'o sy said wits shall go to sad beoose part of iay residuary ss to ys. -1- Exhibit A D (6), All the rests residue and rc~sinder of q •atate, of whatsoever ]cind and oharaotar, and whsresosver situates of which I shall die seised and posaesaad, or to which Z shall De eatit~ed at the tine of q deosaas, inolv-dina that property or share of the estate of q tathsr, Chaska H. Bergaor, late of the Citj apt Haprisburg, Dauphin County, Tsnnsylvania, deosased, over which Z have power of appointasent, I give, devise and bequeath unto sT Trnatess, hsrsinattsr nased~ in truat~ nevertheless, for the tolloring uses end purpoa8r, that la to •ay: (a). ~o invent and loasp'inveatad the sans and sansge tJae sass, continuing suoh inwsbasn to •s I say have at the tine of sy death, end •t and in their discretion, to sell and convert the sale into other seonrities. It is not ><7 intention to licit the Trustees to invesbaenta of the type which ere legal for trust funds, but they say azsrais• their best dlsoretian in these setters. (b). ?o sell and oonvsy, end I hereby suthorizs, empower and dirsot sy Sruateas to sell all sy real estate, (inoluding, in oas• sy wits, Dell• J. Bsrgnsr, should prsdsosase se, that part already devised to her upon oondltion of her survival, as set forth in Paragraph (l~.) preosding), either •t publio or private •sle or sales, at suoh tines, for suoh prises, upon such terns, in suoh sanasr and way as they say in their disorstion deer advisable, whsthar for the purpose of paysant of debts or of ooaversioa into other inveataeats, and to essoute, •olmowleds• and deliver good and sutYioient tee simple deed or deeds to the purohaasr or purohasers thereof, without •ny obligation on the latter to •se to or be responsible for the epplioation of the purohas• soney. Any suoh sale shall be aub~eat to the approval of my ~_ aaiQ wife, it she be rhea living and oapable of giving her oonsent. t ' (o). Yy ?iusteea shall also have porsr, 11' in their dis4ratioa they shall ao dses it neoessary for the beat interests of ny estate, not only to sell and oonvey the real estate, but to purchase real estate as well. -2- `. f --~ (d}. To pay orer the net inoome of said residuary fund, less interest on outstanding indsbtedneaa, trop ti=e to rise, to my aforesaid wits, Della J. Bergner, for and during the term of her natural late, for her oomtortable mainteaanas, and that of ay daughter, Anna tlirginia Berga~r, and for the sduoation of my said daughter. (e). During the fora of the natural lita o! ay aforesaid wife, ay Trustees, in their discretion, and provided my wife agrees, nay pay or use so auoh of the prinoipal of sy estate, In addition to the aforesaid inoome, as may bs neoesaery or advisable for the caotortabls saintenanoe and support of my said wife end daughter, and for the latter~a eduoation, or for a q~ other purpose or purposes, in oonneotion with their welfare, health er general w•11#~sing at any tlae, is •ny eaergeaey o: •therwisej after the death of aq wit'e my surviving Trustee shall have s Lailar authority to ezpend priaoipal throughout the raa~ainder of the treat, for my daughter, as hereinafter sat forth. , (!). fy lrnatees shall h11~• authority and are ~ hereby suthor3aed to horror auoh sun or aims of moaeT as is •heir opinion say b~ aeoosasry or advisable for the payment o! debts, tasea, and other shargsa, for th+a proper ^anagaawnt end tarrying on a! mT estate, and shall have full aYt2srity sad sre hereby authorised do eueaute end Mlirergaad or bonds and sostgagea~ notes, at other evi~enosa o! indebtedness, whim soy be •eoured b7 liens, upoat a? 4ai4 real estate, or my personal propsrtf, whioh ~4' lrrtatosa are hereby authorised to pledge !or •aid purpose, with as full terse end •tteot as 1 nyaelf oould do it lining. And,turth~r, ay lruateaa shall ha~~ authority to borrow nay suoh aura from the Capital Bank sad trust Coapany, of Harrisburg, Tennsylvania, In its own right, or in any , liduciary upaoity. ~ ft (8). It aa~ other ohildsea shall be bons to •T wife •nd atiyselt, is addltioa to sq •toresaid daughter, suer the s=acn- tloa of this aq will, than sad in that Ducat the entire provisions of this trust as to ay daughter shall so estead to and inolgde •n7 such after-~-os~a abi~dren so that all q ohildron shall share oQuall! snd proportionately is sy estate. (h). the above trust provision and those following, ~ In aoaneotioa with sy aforesaid danghttr or auy after-born ohild yr ohildren, are aLo subject to thin soaditioa; that both principal an,d incase shall be alsar of their respastiv• debts, ooatraeta, agreeaenta, alienations, antioipatioaa, and free and clear of all lsviea, attaoh- aents, ezeoutions, and sequsstrationa. (i). Bpon the death of my •aid wits, Dell• J. Bergner, this trust shall oontinu,e tpr tlse benefit of a/y laid daughter, Lnna Yirginia Bergner, and for any other ohild or ohiidren of sine barn •t ter the ucsoution of thin wills equally and proportionately Yy surviving Trustee shall.pay or use the net inooaa therstraa (or should there be sore than one child, the inooae troy their res,peotiv abates), for the aainteaanee, eduostion and use of sy said shild or / ildren until they shall, respectively, attain the age of twenty-one (~l~ years. At that tine, ay surviving Trw tee shall pay to snob child the net inaos-e, it nay, which nay have aoaumulated on his ar her share, and thereat ter pay his or her, Eras tine to tile,-the het incase suD- •equently received frog his or her reapestiv• share for and during the ~ period. sad term of his or her natural sits. Zt and whoa my surviving 3'ruate• deesa it necessary or advisable, ny surviving Trustee nay ua• ~~ such portion of the prinsipal of any child-a share for his or her Dare, sduoatiayti ana oastortable aalnteruae• as it auy elect. -~- -~ y,.,, --s j- (j)• I! any child or children of nine shall dies either before or after the death of aft site, cad shall h1a•elP, herself, or theauslves be surrived b7 Lstul issue, then and i~- that e-eat this trust shall oontimis eaQ that portion of the set iaaone that would hors bean pa7abls to the parent, 1t living, shall be paid to or used tar the benefit of said lastul issue, is equal proportions according to the cumber of children surviving my deceased child or children, tar s period of tyrentT-once (Zlj years after the death of each of mT ehildren leaving lawful iaaue• Opoa the aspiration of the tseaty'oas (21~ rear period thla trust shall cease cad ter,Lu te, insetar as the interact in this trust fucod vt the lawful laane of s nob deceased child is ooncsrasd, and srT surviving Trustee shall pay over to the lawful iaaue, their respeetive shares, per atirpsa and cot per capita, of the principal of tha trust fund together with say accumulated iaoome thereon. It, however, any child or ahildrea of mine shall die, without himself, herself, or themselves having lawful iaaue to surrlve him, her or them, tbea and in that event the interest in this trust fund of said child or children shall become vested is sty surviving child or children, it any, subJeot to the conditions hereinbetors set forth. But, if my child has, yr all my children have, predsoeaaed my wife, leaving ao lawful lease, then end 1n that event the net income troy sy entire rssidusry estate held by my Trustees shall go to and be paid over to ny said wife, Della J. Bergner, for her eselusivs use and benefit, for and during the term of her natural liter and upon the death of sT said siS's the net inooais from said entire trust fund shall go to and be paid, perpetually, to the Harrisburg Hospital, Sarriaburg, la., its suoosasors and assigns, for the special acre of children wader the age of fittesa (15} years. r -5- ~ i It, ho^svsr~ s7 ohild or •ay ohildren of sine shall survive my wife and shall di• without leaving lantul issue, or said lawful issue shall di• before the szpiration st the twenty- one years, to hereinhstore provided, then and in that event the net ~~~oome troy said •ntirs trust fund shall. go to end be paid, perpetually, to tho~Harrisburg Eoapital a!`oresaid, its suooetaors sad assigns, for i the apsolal oars of children under th• age of fifteen (15) years. (k). In the selling or purohaaing of real •atnte, ~ and in investing sad siinveating priasi~sl of ay frost estates alter the death of ay wits aforesaid, sy oAild or Qhildrea then •urriving, {it they t» of legal age and of sound sired), shall be ooasultsd and kept advised and intorsed by m7 surviving, Truatesj sad their aonaeat and appronl shall be obtained in all aajor matters then atteoting the aaaageaeat of sty es to te. (1). Yy Trustees shall, moreover, in caking settle- seat under the provisions of the aforesaid trust at any time, have power to sake distribution in Dash or in kind, ns may be desired or convenient. {7). It, at the tine of my death, prior to the netting up oP my trust estate, as hersinbefors set forth, my Szeautriz and Yzsoutor, hereinafter eased, shall rises it neeeasary sad desirable to purehase real estate, or to rill sad dispose of any of my real estate, they shall hale power to do so, and I •ocordingly order, authorize, eapowtr and direot sy Ea~eautriz sad Faeoutor, hereinafter nosed, to sell suoh real •atats, either at publio or private sale or sales, for the beat prioe or prioss thataan b• gotten !or the seas, and by ~- proper dead or deeds, oonveyanoes or saauraaoea in the law, to b• duly ezeouts~, aoknowledged and psrteatsd to grant, ooavey and assure the same to the purchaser or purchasers thereof, in tea simple, without any obligation on the latter to see to or be responsible for the appliaatior. of the purchase money. -b- (8). Yy Bycooutriz aad Bseoutor shall, aoseowr, have authorlty and are hsreDy authorised to borrow •uoh sus ou eosin of coney •s in their opinion say b• neoeasary or advisable for the pa~rmsnt of debts, tazea, and other ohargea 1.a the aettleatent of sy estate, and shall have tulh authority and ere hereby authorised to szesute and deliver bond or bonds and aortgagea, notes, or other evideasoea of indebtedness, which uT be secured by liens, upon my ea id coal estate, or my personal property, whioh my Bxeontriz end S~ceoutor ere hereby authorised to pledge foZ said purpose, with •a full tome and effect as S gselt aodld do it living. end, further, >ty Bzeoutriz and Bteeutor shall have authority to tierro• any such auau from the Capital Bank end S~ust Company, of Harrisburg, Pennsylvania, is its own right, yr in any tiduoiary capacity. (9). Z direct that all transfer inheritance, estate or other taws, State or Federal, assessed upon or in respect of all bequests and devises, herein given or made to my wife end ohild or children, or upon property passing to them outside of testamentary provisions, shall be paid by my r~.ceautrix aad Ezeoutor out of the assets of my estate, without deducLioa from acid beaussts and devises. (10). Z noatinate, constitute and appoint my aforesaid ate, Della J. t3ergaer, Steoutriz, and the Capital ~an1c and ?rust Cospany aforesaid, Aceoutor, respectively, of this my last will and testament. (11). LL9TLY, I nooinate, constitute and appoint my aforesaid wife, Della J. Bergner, and the Capital Bank and Trust Company aforesaid, Trustees under Chia sy last will and teatsaent. t -7- IX 11I'PpSSS tHSR8a1~, I hs~e to this s7 last will and testaaent, ooatained Lo- thin •nd se~raa preoedlus pagan, set aq hand and anal at the end hereof, this 3oT" daT et Yareh, •. D. 1953. i , visaed, sealed, pnbliahsd and ) deelaxed ti7 ~sorgs Desgner, )) tha testator above named, •• sad for his last Mill ani ) LNb •ent, in Our preaenes, } who, la his preaes~ee, st hS,a ) regneat~ and is the preaene• ) of eaoh other, hate hersaate ) auDaeribed onr aaasa as attest- ) ing witnaaaea. } C ,~Z~}~V}~ 1?~ v.th~_(sSAL) ) -r"""'- mow-; S. ~.r,` •8- Private Capital Management First Union National Bank . F Na PA6906 100 North Queen Streec ' PO Box 3226 Lancaster, PA 1 %604-9818 i 300 531.6162 Iul y 19, 2001 Virginia B. Taylor 210 Plains View Williamsburg, VA 23188 Re: Account # 1513102197 Dear ~1s. Taylor: I am responding to your letter you had sent to Susan Stevens regarding the fee schedule. I appreciate your letter and hope to be able to clarify some issues regarding the fee schedule. In review of the Trust accounts that First Union has, we have found that this account needed to be adjusted to a standard fee schedule. The annual minimum fee of 5^000.00 will apply. Since this account is on a standard fee schedule, we will be discontinuing the 6% being charged on income and having a 60 basis point sweep fee. We have reviewed the Trust document, and there are provisions in the document that will allow principal withdrawal for your care and comfortable maintenance. If you have any further questions, please feel free to contact me at 800-531-6162. Thank you, i ~~ A Y. Lee ~ Relationship :Manager Capital Management Group r Exhibit B CONSENT TO PETITION FOR TERMINATION OF TRUST THE UNDERSIGNED, CHRISTOPHER MARKLEY, Senior Vice President for Community and Governmental Relations of the PinnacleHealth Foundation, hereby consents to and joins in the Petition for Termination of Trust, for the purposes expressed therein and acknowledges receipt of a copy of the Petition, including all exhibits thereto. COMMONWEALTH OF PENNSYLVANIA COUNTY OF 1~~ j,( jJ/.~ //V~ CHRIST HER MARKLEY SS. On this, the '~ ~ day of ~~ 2002, before me, 1=he ~~ undersigned officer, personally appeared CHRISTOPHER MARKLEY, ]mown to me (or satisfactorily proven) to be the Senior Vice President for Community and Governmental Relations of the PinnacleHealth Foundation, and the person whose name is subscribed to the witrlin instrument, and acknowledged that he, being authorized to do so, executed the same on behalf of PinnacleHealth Foundation, for t;he purposes therein contained. IN WITNESS WHEREOF, I hereunder set my hand and official :>eal. +i / ~ ~~p,~uc Notary P is "" .: rye-,+!5*,"'... M"~r,.s:r~+,: Exhibit C