HomeMy WebLinkAbout08-03-93
1 (Whereupon, the testimony of Robert M. Frey
2 appears as follows:)
3 THE COURT: This is the time and place set
4 for the request for a preliminary injunction that was filed
5 by Robert M. Frey, Esquire, who was court appointed by me as
6 guardian ad litem for the minor persons interested in the
7 estate of Robert M. Mumma, deceased. I had previously
8 denied an ex parte injunction, so we're ready to proceed now
9 on the injunction hearing.
10 Counsel have asked if they can make an opening
11 before we proceed into testimony, so we'll proceed first
12 then with Mr. Frey, if he cares to make an opening. We'll
13 then hear from Mr. Sonnenfeld. Is that correct?
14 MR. SONNENFELD: Yes, Your Honor. Thank you.
15 THE COURT: Okay. And then we'll hear from
16 Mr. Stevenson or Mr. Shields, who represents Robert Mumma,
17 II. So, Mr. Frey, do you care to make an opening?
18 (Whereupon, Mr. Frey opened on behalf of the
19 guardian ad litem.)
20 THE COURT: Mr. Sonnenfeld.
21 MR. SONNENFELD: Your Honor, it would be
22 appropriate for Mr. Mumma's lawyer to go next since Mr.
23 Mumma's lawyer has joined in the petition filed by Mr. Frey.
24 THE COURT: Mr. Shields.
25 (Whereupon, Mr. Shields and Mr. Farrell
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1 opened on behalf of Robert M. Mumma, II.)
2 THE COURT: Mr. Sonnenfeld.
3 (Whereupon, Mr. Sonnenfeld opened on behalf
4 of Barbara McK. Mumma and Lisa Morgan.)
5 THE COURT: Are there any other counsel here
6 who represent some party that would like to say anything at
7 this point?
8 MR. SONNENFELD: Your Honor, Mr. Stevenson is
9 here, Mrs. McClure's lawyer, and as I said Mrs. McClure has
10 joined in this transaction. I'd also like the record to
11 reflect, if we could, that Mrs. Mumma and Mrs. Morgan are
12 present in court today.
13 THE COURT: Would you identify yourself and
14 go ahead and make your comments.
15 (Whereupon, Mr. Stevenson opened on behalf of
16 Barbara M. McClure.)
17 THE COURT: Anyone else?
18 (Whereupon, no response was heard.)
19 THE COURT: Mr. Frey, you may proceed with
20 your testimony then to support your injunction.
21 MR. FREY: Thank you, Your Honor. I would
22 call as my witness Robert M. Frey.
23 Whereupon,
24 ROBERT M. FREY
25 having been duly sworn, testified as follows:
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DIRECT EXAMINATION
BY MR. FREY:
Q Would you state your name and address,
please.
A Robert M. Frey, 5 South Hanover Street,
Carlisle, Pennsylvania.
Q How are you a party in these proceedings
today?
A I'm the Petitioner in my capacity as guardian
ad litem for the minor children of Robert Mumma, II,
pursuant to an appointment made December 29th, 1988, which
said in part, with authorization to represent said minor
persons in all matters related to the sale of Nine
Ninety-Nine, Inc., and Hummelstown Quarries, Inc., etc.
Q Is it your understanding from the
documentation you've received that the transactions which
have either occurred or are pending involve the assets with
which you were appointed?
A That's my understanding, but I'll have to
confess that my understanding is somewhat vague. The
documents which I received copies, not from the sellers but
from counsel for Robert Mumma, II, were close to two inches
thick and to digest their contents which set forth what
seemed to be a very complex transaction is not easy, and I
don't pretend that I have mastered those contents.
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1 Q At the time you were originally appointed
2 guardian ad litem in 1988, were you aware of negotiations at
3 that time regarding the sale of Nine Ninety-Nine?
4 A That was my understanding, and that was my
5 understanding of the purpose of the appointment because
6 these various substantial businesses were proposed to be
7 sold and there was felt by the estate of Robert Mumma; that
8 is, by his executors, that it was appropriate that the
9 Orphans' Court pass judgment on the proposed sale and
10 specifically that a guardian ad litem for the minor children
11 of Robert Mumma be appointed, and it was pursuant to the
12 petition by the executrices of the estate of Robert Mumma
13 that I was appointed.
14 MR. SONNENFELD: Your Honor, I would move to
15 strike Mr. Frey's testimony about the contents of the
16 petition. I think he is mischaracterizing -- the petition
17 is in writing, and it will speak for itself.
18 THE COURT: It will speak for itself. Go
19 ahead.
20 BY MR. FREY:
21 Q At the time of your original appointment,
22 were you in any way involved in discussions, conferences,
23 with parties involved in the sale of the assets involved?
24 A Not at the time of my appointment, no.
25 Subsequently there were all sorts of discussions and
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1 conferences and contentions, disputes, almost ad infinitum.
2 Q And were you kept informed by representatives
3 of the executors of the estate and the trust of Robert Mumma
4 regarding some of those proceedings?
5 A No, I don't think so. I got very little, if
6 any, substantive information. It was a constant wrangling
7 over procedure and the authority of various parties who
8 concerned themselves with the transaction.
9 Q Were you ever informed what the result of the
10 negotiations for the sale in 1988 and 1989 were? Were you
11 ever informed what the result of those negotiations were?
12 MR. SONNENFELD: Your Honor, it really calls
13 for hearsay.
14 THE COURT: I'll permit him to answer the
15 question.
16 THE WITNESS: I was given the understanding
17 that the sale had collapsed and that it wasn't going to
18 occur, and then there were reports to the effect that maybe
19 it was going to be revived, and then I heard nothing until
20 it was brought to my attention that the sale, which is the
21 subject of reports this morning was planned to take place,
22 and when this came to my attention it was then that I felt
23 that I was obligated as guardian ad litem to present the
24 petition which has been referred to earlier and which is the
25 basis for the hearing this morning. I brought that petition
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1 because I thought it was my fiduciary duty to do so.
2 The disclaimer that was filed I felt was not
3 subject to being rescinded or revoked. Robert Mumma, II,
4 purported to rescind it. The Court, after argument, has
5 upheld his right to rescind it, and I intend to take an
6 appeal of that unless directed otherwise by the Court so
7 that there will be a final definitive ruling on whether that
8 disclaimer is valid and the children of Robert Mumma, II,
9 have an interest in the estate or whether they don't. That
10 is the reason I brought the petition, and that is my view of
11 my duties as guardian ad litem.
12 I think the Court needs to know that the assets
13 that are being sold here are extremely unique. It would be
14 virtually impossible as a practical matter for anybody to
15 try to duplicate the businesses that were so carefully
16 assembled over the years.
17 That difficulty is in large part because of the
18 environmental problems and all sorts of business problems
19 that make these businesses extremely valuable, and even the
20 nature of the businesses themselves is such that they are
21 not analogous to many other businesses.
22 MR. SONNENFELD: Your Honor, I move to strike
23 the answer. It's going way beyond the scope of the
24 question. It's calling for conclusions and opinions that
25 there are no foundation for from this witness.
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1 THE COURT: We'll let him answer it in the
2 manner which he did. I'm not going to strike it. Go ahead,
3 Mr. Frey.
4 BY MR. FREY:
5 Q What aspects of the sale of which you've been
6 notified caused you concern and caused you to file a
7 petition?
8 A Well, the first aspect was the failure to
9 notify me, because it struck me as being contemptuous of
10 this Court whether notice was to be given to me or not.
11 If the executrices of the estate were truly
12 interested in exercising their fiduciary duties to settle
13 their father's estate in the manner most advantageous to all
14 the parties concerned, they very carefully started out to
15 get Orphans' Court approval and then for reasons not known
16 to me they did not proceed to inform the Court nor to inform
17 me.
18 I was given to understand that the consideration
19 for the sale was approximately ten million dollars less than
20 the same buyer had indicated a willingness to pay sometime
21 earlier, and I had also been given to understand that Robert
22 Mumma, II, was desirous of being the buyer.
23 And as guardian ad litem for his two children,
24 while I have no obligations to Robert Mumma, II, whatsoever,
25 I feel I have obligations to his children as their guardian
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1 ad litem.
2 If his children inherit approximately one fourth
3 of the estate of their grandfather, that's fine, but if my
4 wards' father becomes the purchaser of these assets, they
5 have a reasonable likelihood, certainly a possibility of
6 inheriting the business acquired by their father when he
7 eventually departs this life; and, in effect, they have a
8 good chance of inheriting all these Mumma interests twice,
9 and that seems like a good reason for me to hope that if the
10 family decides to dispose of the family business, that these
11 grandchildren of the decedent have an opportunity to
12 reacquire through inheritance these assets.
13 It looks like a win win situation from the
14 grandchildren's point of view as I see the situation, and
15 the element of self-dealing that seems to be present in the
16 documents which I had together with my knowledge of the
17 contemptuous relationships which exist among all these
18 parties tends to taint the whole transaction and
19 relationship when you look at it in its entirety.
20 One constantly wonders what the motivation is and
21 whether the normal business motivation of doing the best job
22 possible may not be overruled by vindictiveness and
23 hostility and whatever else exists in the relationships of
24 these parties, which to me is readily apparent from all the
25 litigation which has occurred in regard to the Mumma's.
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1 They have become practica11y a laughing stock in the local
2 newspapers.
3 MR. SONNENFELD: Your Honor, this is no
4 longer testimony but has digressed into the realm of
5 conjecture and speculation. It's not responsive to any
6 question and really contains the opinions of the witness
7 without any foundation. I'd move to strike.
8 THE COURT: Well, I'm going to let Mr. Frey
9 speak his mind. You can cross-examine him on any relevant
10 parts of it that has to deal with the injunction, so what he
11 said, we'll let it stay.
12 MR. SONNENFELD: It's very hard for me to
13 object because the questions come out innocuously and then
14 the answers go on interminably.
15 BY MR. FREY:
16 Q As guardian ad litem, what do you believe to
17 be the proper protection for your wards in this transaction?
18 A As requested in the petition I think my duty
19 to the wards and my duties to the Court requires that the
20 disposition of these very valuable Mumma interests be
21 scrutinized as to the perfectness of the consideration and
22 whether the best price and best terms were obtained.
23 And in regard to Robert Mumma, I have always said
24 that he should be treated as the first among equals as far
25 as the rights to buy is concerned.
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10
1 My other concern as a duty to the Court is that
2 the legal profession in general and the courts in general
3 have been subjected to much criticism and public ridicule,
4 and it's important that not only the letter of the law be
5 observed but that the perception of justice and fairness be
6 maintained, and with what I perceive as the tainting of many
7 of these procedures by ill will, it behooves me to do
8 everything within my power to uphold the perception of
9 fairness by the legal profession.
10 Q As a point of clarification, in your petition
11 you stated that it was your understanding that Robert Mumma
12 would be filing a joinder which would include the withdrawal
13 of his revocation of his disclaimer, is that correct?
14 A That was my understanding.
15 Q That was a correct statement at the time?
16 A It was a correct statement at the time the
17 petition was prepared. Subsequently I was given to
18 understand what I thought I understood was not what was
19 intended by Mr. Mumma's representative to be his position,
20 and at that point the petition was already filed; and at
21 that point I also felt that even if his joinder didn't
22 occur, I still had a duty as guardian ad litem to proceed
23 with the petition. So I didn't withdraw the petition even
24 though that representation didn't prove to be fulfilled.
25 MR. FREY: I have no further questions.
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THE COURT: Cross-examine.
MR. SONNENFELD: May I proceed, Your Honor?
THE COURT: Yes.
CROSS-EXAMINATION
BY MR. SONNENFELD:
Q Mr. Frey, who was the representative of Mr.
Mumma who made the representation to you that Mr. Mumma
would revoke his revocation of the disclaimer?
A Mr. Morrison.
Q Mr. Morrison?
A Correct.
Q That is the lawyer for Mr. Mumma?
A Gerald Morrison, Esquire.
Q And when did Mr. Morrison make to you the
representation Mr. Mumma would revoke his revocation of the
disclaimer?
A Telephone call on Friday morning, July 16th.
I believe that it was a Friday.
Q Okay. And in this telephone call didn't you
and Mr. Morrison discuss the petition that you ultimately
filed on behalf of the minors, who are your wards?
A I don't think so, no.
Q Did he ask you to file the petition?
A Not in that conversation.
Q In a subsequent --
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1 A No, his phone call to me was in response to
2 our earlier communications when he suggested that that was
3 the appropriate course of action for me to take.
4 Q Mr. Morrison, Mr. Mumma's lawyer, suggested
5 to you that the appropriate action for you to take was to
6 file the petition you then filed, is that correct, sir?
7 A In substance, yes.
8 Q And did Mr. Morrison review the petition
9 before you filed it?
10 A Review the petition?
11 Q Yes, sir.
12 A He didn't review it with me, but I think he
13 may have reviewed it with my son.
14 Q And did Mr. Morrison assist your son in the
15 preparation of that petition?
16 A I can't say to what extent he provided any
17 assistance. The fact that they discussed it, if they
18 discussed it, would infer that some assistance would result
19 from a discussion.
20 Q All right. And you had the first discussion
21 with Mr. Morrison about the petition he asked you to file on
22 Friday the 16th. Is that correct?
23 A No, that's not correct. I had the first
24 discussion the preceding day, on Thursday.
25 Q Thursday the 15th?
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1 A Correct, if that's the right date.
2 Q And did Mr. Morrison tell you when he had
3 received notification of the sale?
4 A 1 believe he did, but 1 didn't make note of
5 the date that he received notification of it, and his
6 bringing that information to me on that Thursday was the
7 first that 1 was at all aware of anything transpiring
8 relative to disposition of these interests.
9 Q Did Mr. Morrison tell you that he had
10 received notification of the sale on Monday the 12th?
11 A I believe he did, but I wouldn't swear to the
12 date.
13 Q And you filed your petition before this Court
14 seeking an injunction on Monday the 19th, isn't that
15 correct, sir?
16 A I think that's correct, yes.
17 Q So that was about a week then after Mr.
18 Morrison had received notification of the sale?
19 A Assuming that he received notification of the
20 sale on the 12th.
21 Q Assuming that, sir, but that's your best
22 recollection of what he told you?
23 A Yes.
24 Q And as of Monday the 19th, it was your belief
25 that Mr. Mumma was going to revoke his revocation of the
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1 disclaimer based on what Mr. Morrison had told you?
2 A Yes.
3 Q Now, on the 19th when you filed your
4 petition, you knew that the estate and the trustees were
5 represented by Mr. otto, did you not?
6 A No, I don't think I did.
7 Q Did you know Mr. Martson represented the
8 estate and the trustees?
9 A I knew he had earlier, yes.
10 Q And yet you didn't serve a copy of your
11 petition on counsel for the estate and trustees, did you?
12 A I personally didn't serve a copy on anybody.
13 Q And isn't it a fact that you didn't provide a
14 copy until after it was requested by counsel for the estate?
15 A I don't know if that's a fact or not.
16 Q Do you know when it was that you ultimately
17 provided copies of your petition to counsel for the estate
18 and trustees?
19 A No.
20 Q Isn't it a fact that several days passed
21 before you provided copies?
22 A Might have been. I don't know.
23 Q Now, you as attorney for the minors or your
24 wards have not caused any appraisal to be conducted, have
25 you, concerning the value of any of the assets that were
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sold?
A No.
Q And you're aware in general terms, are you
not, that the economy today is worse than the economy was in
1988?
A No.
Q Wasn't that the major issue in the election
in November, the economy?
A It was to some. It wasn't to me.
THE COURT: Let's not get into the election.
BY MR. SONNENFELD:
Q The deal in 1988 didn't close, did it?
A No, not to my knowledge. If it did, it
was --
Q And do you recall that in 1988 Mr. Mumma
asserted a right of first refusal for the assets of the
estate?
A The assets. I recall that he claimed that,
right.
Q And isn't it a fact that it was because of
the assertion of that right of first refusal that the 1988
transaction didn't close?
A I don't know.
Q Well, do you know whether Mr. Mumma
threatened the purchaser in 1988 with litigation if the
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1 transaction proceeded?
2 A I don't know what threats, if any, he made.
3 Q You don't know that. Would that be pertinent
4 to how the trustees and the executrices proceeded; that is,
5 if Mr. Mumma were threatening a buyer in litigation?
6 A It would be a good reason to sell it to him
7 to get rid of the threat. His money ought to be as good as
8 anybody else's.
9 Q But certainly you would agree, would you not
10 in your experience as a lawyer, that a threat of litigation
11 will discourage a perspective purchaser?
12 A It might, yes.
13 Q Most buyers would prefer not to buy into a
14 lawsuit, wouldn't they?
15 A Typically, yes.
16 Q Now, do you know what assets were being
17 conveyed in 1988 or were contemplating to be conveyed in the
18 transaction that didn't close?
19 A Not with preciseness.
20 Q Do you know whether or not with preciseness
21 the assets contemplated to be sold in 1988 were the same as
22 the assets actually sold in 1993?
23 A It's my understanding that they were
24 substantially the same but there were some differences.
25 Q There were some differences. Do you know
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what the differences were?
A Not precisely, no. I learned a little from
your opening statement.
Q other than my opening statement do you know
whether the assets were the same that were contemplated to
be sold in 1988 as what was actually sold in 1993?
A It was my understanding that they were
substantially the same.
Q And that's because that's what Mr. Morrison
told you?
A That and from a cursory examination of the
documents that Mr. Morrison showed me that apparently had
been sent by you or by somebody on behalf of your clients to
either Mr. Morrison or Mr. Mumma.
Q Or both?
A Or both; however
Q How long did you spend reviewing those
documents?
A Not very long.
Q Did you --
A Couple hours.
Q Did you spend long enough to form in your
professional view a judgment as to what was being sold?
A Only in a very general way.
Q And would you acknowledge that as you sit
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here today to testify, you don't know precisely what was
actually sold in 1993 compared with what was sold or
contemplated to be sold in 1988?
A No, I don't know precisely nor do I think
it's especially relevant.
Q Now, you're aware that there was litigation
between the executrices and trustees and Mr. Mumma in this
Court over his alleged right of first refusal?
A I know the claim was asserted. I don't know
whether it was ever litigated or not.
Q You don't know whether or not this Court ever
ruled that Mr. Mumma had no right of first refusal?
A I don't think I ever saw such a ruling or
order.
Q If you had known this Court had ruled that
Mr. Mumma had no right of first refusal to buy the Pennsy
Supply businesses, would you have still filed the petition
in the form in which you filed with this Court on the 16th
of July?
A Yes. I never thought he had a right of first
refusal, but I always maintained that he should be treated
as first among equals. Perhaps I was the only one who felt
that way, but that's the way I have consistently felt and
still feel.
Q Even though there are four siblings, four
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children of the late Mr. Mumma, is that correct?
A Correct.
Q That is your view, among those four siblings
Mr. Robert Mumma, II, should be treated differently than the
other three?
A No, it's my view that among all perspective
purchasers he should be first among equals. If all
perspective purchasers are willing to buy whatever is to be
sold on the terms and conditions that are acceptable to the
sellers, he must be given first right to buy on those terms
as a matter of family decency.
Q Well, wouldn't that be treating him
differently than the other siblings?
A No, the others haven't indicated any desire
to buy. If they desired to buy, then he wouldn't have any
priority over his siblings.
Q Well, is it your position if the other offers
were dollar for dollar equal to an offer from Mr. Mumma,
that the assets should be sold to Mr. Mumma?
A If dollars were the only consideration for
the sale, yes.
Q Have you taken into consideration whether
that principal would discourage anyone else from making an
offer?
A Yes.
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Q In any event, you were unaware and are
unaware as you sit here today as to whether or not this
Court has ruled that Mr. Mumma had a right of first refusal?
A That's correct. I've never seen that. It's
my understanding that the argument never got anywhere, but
what caused it to either be abandoned or terminated, I don't
know.
Q When you say the argument never got anywhere,
you're just guessing, are you not?
A It's my understanding from statements that
have been made in a general sort of way that the argument is
no longer being pursued, and I assume it was either dropped
or otherwise terminated.
Q Is that something Mr. Morrison told you?
A No.
Q Is that something Mr. Mumma's counsel told
you?
A No.
Q All right. Are you aware that in the case
known as Equity 66 that this Court has ruled that Mr. Mumma
has no right of first refusal?
A No, but if you say so, I'll take your word
for it.
Q And if you'll take my word for it, would that
affect your view on the petition you filed on the 16th?
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A No.
Q Now, when did you learn that contrary to his
prior representation through Mr. Morrison that Mr. Mumma
would not be revoking his revocation of the disclaimer?
A Friday.
Q This past Friday?
A This past Friday. Was it the --
THE COURT: 23rd.
BY MR. SONNENFELD:
Q Friday the 23rd?
A Correct.
Q And how did that come to your attention?
A I received a fax from Mr. Morrison outlining
a proposal that he had on behalf of Mr. Mumma.
Q And what was that proposal, sir?
A A qualified disclaimer.
Q And was that proposal set forth in a letter
to you?
A Yes.
Q What else did the letter say?
A It was a provision where Mr. Mumma would make
certain immediate provisions for the benefit of his
children, who are my wards, as an attempt to resolve the
dispute between Mr. Mumma and me concerning his efforts to
disclaim or to rescind his disclaimer.
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Q What else was in the letter?
A I don't remember the exact details. It was a
couple of million dollars to provide for the children. I
was not pleased when I received the letter and didn't
attempt to digest it.
Q You were not pleased because it was contrary
to what Mr. Morrison told you a week or eight days before?
A It was contrary to my understanding of what
he had told me, yes.
Q Was it contrary to the understanding that's
reflected in the petition you had filed with the Court a
week before?
A Yes.
Q By the way, when you filed the petition with
the Court a week before, did you serve a copy on Mr.
Morrison?
A I don't know. I didn't.
Q Okay.
A My son acting as my attorney may have.
Q In any event, this letter that you got from
Mr. Morrison this past Friday, the 23rd, did this call for a
response by you?
A I don't know if it called for one or not, but
I made a response. I telephoned him immediately upon
receiving the letter that I was not happy with it. It was
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1 contrary to what I expected and that I was not going to
2 endorse it.
3 Q Was Mr. Morrison asking for your agreement to
4 the contents of his letter to you this past Friday?
5 A In substance I think that might have been the
6 tone of it. I think the letter was outlining a petition
7 that he proposed to present to the Court which he hoped I
8 would endorse or approve or agree to, and I said that I
9 would not, that I thought, in substance, that the disclaimer
10 originally filed by Mr. Mumma should either rise or fall.
11 Q Well, when you learned that Mr. Morrison,
12 contrary to your understanding, was not going to file a
13 qualified revocation of Mr. Mumma's revocation as you had
14 represented in your petition, didn't you as an officer of
15 the court consider that you had an obligation to correct the
16 petition that you had filed?
17 A Not between 5:30 on Friday and 9:00 a.m. on
18 Monday, no, I didn't feel that I had that obligation.
19 Q Well, didn't you know that
20 A Because the record speaks for itself.
21 Q Didn't you know that two days before, on
22 Wednesday, the 21st, that Mr. Morrison had caused a petition
23 to be filed, excuse me, a joinder to be filed in this Court
24 to your petition in which Mr. Morrison on behalf of Mr.
25 Mumma did not waive an unqualified revocation of the
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disclaimer?
A I don't think I did know that.
Q If you had known that, would you have
considered that something that you as an officer of the
court were obliged to bring to the attention of the Court?
A Seems to me it had already been brought to
the attention of the Court by the fact that it was filed
with the Court.
Q Well, you've been telling us about the
obligations of lawyers. If a lawyer files something with
the Court that contains a statement that the lawyer then
learns is wrong, doesn't the lawyer have an obligation to
correct it, sir?
A Yes, indeed. That's what we're doing here
this morning.
Q Okay. Now, this document that you got from
Mr. Morrison on Friday was proposing some kind of a deal,
was it not, between you on behalf of the minor children and
Mr. Mumma, II?
A It was you could call it that, but it was
not a deal that would be made outside and without Court
approval.
Q And this was a deal that had been under some
discussions by you and Mr. Morrison for at least a week, was
it not?
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A It was never discussed with me. That's why
it came as a shock on Friday. It may have been discussed
with my son, I don't know, but it was never discussed with
me.
Q And what was shocking to you?
A Because it was contrary to my understanding
of the earlier representation.
Q Do you recall any other terms of his deal
that was shocking to you?
A The fact that it was different was the shock.
It wasn't the terms. It might have been a generous
arrangement, but the fact that it was contrary to my earlier
understanding did not sit well with me.
Q Do you have any -- do you have the letter
with you today?
A No.
Q Where is the letter?
A It might be back in my office.
Q Do you know whether your son has it here in
court today?
A I don't know.
Q Do you know whether Mr. Morrison, I'm sorry,
Mr. Mumma brought it?
A I have no idea.
Q Have you discussed the document with them?
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1 A No, not other than my phone call saying that
2 I wasn't agreeable to that sort of thing. It was contrary
3 to my earlier understanding and that my position is Robert
4 Mumma's disclaimer either stands or falls. This Court has
5 ruled that it falls, and I intend to appeal that; and
6 whatever the outcome is, so be it.
7 Q May I see the letter? I see Mr. Mumma, Jr.,
8 has it. If I may take a second to look at it.
9 THE COURT: I don't know why we're getting
10 into all this for. Apparently it's some type of settlement
11 negotiations. Normally I'm not interested in settlement
12 negotiations.
13 Mr. Frey, I might add, is a very respected member
14 of this Bar, and I'm certain that he certainly would not
15 attempt to deceive this Court, and, therefore, I don't think
16 we need to proceed along these lines any further.
17 MR. FARRELL: That was a settlement offer,
18 and I think Mr. Frey has already made it clear that the
19 offer had nothing to do with his decision to file the
20 petition. He made that independently.
21 THE COURT: That's my understanding.
22 MR. SONNENFELD: May I simply mark this as an
23 exhibit, Your Honor? That would conclude my examination.
24 THE COURT: You can mark it.
25 MR. SONNENFELD: Thank you, Your Honor.
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THE COURT:
MR. FREY:
Is that the on1y copy you have?
That's all, Your Honor. That's
the fax we did receive.
(Whereupon, Respondent's Exhibit No. 1 was
marked for identification.)
MR. SONNENFELD: If I may approach the
witness, Your Honor?
BY MR. SONNENFELD:
Q Mr. Frey, what we have marked for
identification as Respondent's Exhibit 1 is a copy of a
two-page letter dated July --
MR. FARRELL: Your Honor, if I may, I have
never --
MR. SONNENFELD: All we want to do is
authenticate it.
THE COURT: It hasn't been offered, and I
haven't accepted it yet.
THE WITNESS: It's not a copy. I think this
was the original.
BY MR. SONNENFELD:
Q That is the document you're referring to?
A To the best of my knowledge it appears to be
a fax. That is the only one I've ever seen in a fax. If it
came through on my fax machine, on our fax machine, why this
appears to be it.
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1 THE COURT: Okay. That's the one they
2 received, so we know that.
3 MR. SONNENFELD: I have nothing further of
4 Mr. Frey, Your Honor.
5 MR. FARRELL: Your Honor, we just have a few
6 minor questions.
7 THE COURT: Mr. Morrison, I'm sorry.
8 CROSS-EXAMINATION
9 BY MR. FARRELL:
10 Q Just to clarify the record, because I want to
11 make sure I understand what your testimony was, regardless
12 of the intimation that we have had from Mr. Sonnenfeld, you
13 never did receive any notice of the sale from the
14 executrices?
15 MR. SONNENFELD: I stipulate to that, Your
16 Honor.
17 THE WITNESS: That's correct.
18 BY MR. FARRELL:
19 Q Mr. Frey, are you aware that the subject of
20 your appointment as guardian ad litem is now before this
21 Court with regard to the interpretation of the exact order?
22 A I'm not sure I understand that question.
23 MR. FARRELL: There has, in fact, Your Honor,
24 been a petition filed by Mr. Frey asking this Court to
25 clarify exactly what responsibilities Attorney Frey has as
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1 guardian ad litem.
2 THE COURT: All right.
3 THE WITNESS: I recall that such a petition
4 was filed, and I'm not aware that it has been acted on.
5 MR. FARRELL: That's correct. It's not been
6 acted on.
7 BY MR. FARRELL:
8 Q Are you also aware that, in fact, at least
9 it's been the position of Mr. Mumma that you've been
10 appointed guardian ad litem for all minor beneficiaries?
11 A I'm not aware that there are any other minor
12 beneficiaries.
13 Q All minor beneficiaries whether they have a
14 direct or indirect interest?
15 A I'm not aware that there are any minor
16 beneficiaries other than Mr. Mumma's children.
17 Q Well, are you aware that your order appoints
18 you as guardian of Mr. Mumma's minor children or does it say
19 all minors?
20 A I think it says all minors, but it says with
21 authorization to represent said minors or the minor persons
22 interested in the estate, but it's my understanding that the
23 only minor persons interested in the estate are the children
24 of Robert Mumma, II.
25 Q The facts being as they are now.
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A It wouldn't make any difference.
Q Would it not be the case that if, for
instance, Mrs. Morgan predeceased --
A It's my understanding that if she were to be
deceased before the estate was settled and distribution of
the trusts were made, that her interests would devolve to
her personal representatives or heirs as part of her estate.
Q That is not correct. If you read the
instrument, you'll see it devolves onto her issue. The
point I'm trying to make, Mr. Frey, is really you have
standing on behalf of all minors irrespective of whether
they are Mr. Mumma's children or
A I took a quick look at the will this morning
and I didn't see anything that leads me to that conclusion,
but maybe I should examine it more carefully.
Q Now, we just heard Mr. Sonnenfeld's
interrogation of you with regard to your relationship with
Mr. Morrison. I just want to clarify something for the
record. Whose decision was it to file the petition today?
A Mine.
Q Do you stand by that decision?
A (No audible response.)
Q You're not -- irrespective of what facts --
A I'm not under duress.
Q And irrespective of what facts might have
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occurred Friday, do you stand by your petition?
A Yes.
Q And is it not possible that, in fact, the
language that was in Mr. Mumma's response on Wednesday had,
in fact, been approved by your son?
A I don't know whether it was approved by him.
Q I didn't ask you whether you knew.
A I don't know.
Q Turning now to the actual sale that's at
hand, what efforts are you aware of that have been made to
market those assets to others?
A I'm not aware of any efforts having been
made.
Q You're familiar with the Will of Robert
Mumma, the decedent?
A Well, at least in a general sort of way.
Q Based on your understanding of the Will,
you've indicated that you believe Mr. Mumma is a first among
equals, is that correct?
A No, not really based on my understanding of
the will. That was a conclusion that I came to based on
what I think is a fair, reasonable, and appropriate way to
sensitively settle an estate.
Q And, in addition, since you're an attorney
and do have familiarity with estate matters, I think you've
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2317
1 heard Mr. Sonnenfeld make representations that the threat of
2 litigation would have the impact of scaring off potential
3 buyers of this property, is that correct?
4 A In a general sort of way, but, of course,
5 when the threat is made by another potential buyer, at the
6 time they file that proposition
7 Q Exactly. Hasn't there, in fact, been a
8 potential buyer step-up?
9 A That has been the representation made by Mr.
10 Mumma and by his counsel, that he would like to buy these
11 businesses if they're for sale and is willing to pay as much
12 or more than somebody else is willing to pay for them.
13 Q And what would be your understanding if, in
14 fact, Mr. Mumma was able to buy these businesses? What is
15 your understanding that that event would have on the
16 numerous litigation that is now in front of this Court and
17 Courts in other counties?
18 MR. SONNENFELD: Your Honor, I object. This
19 is really getting into speculation.
20 THE COURT: I'll ask that he answer the
21 question.
22 THE WITNESS: My understanding is it might
23 lead to a resolution of all sorts of problems in litigation
24 and give this matter a decent termination, not this matter
25 only but the voluminous contentions that apparently are
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outstanding among the Mumma interests.
BY MR. FARRELL:
Q And what impact do you believe or what would,
in your opinion, the sale to the foreign group of investors
do?
A I don't know.
MR. SONNENFELD: Your Honor, I again object.
THE COURT: He already answered the question.
MR. FARRELL: Your Honor, I have no other
questions.
THE COURT: Mr. Frey, do you have anything
else?
MR. FREY: No further questions.
MR. SONNENFELD: Your Honor, may I have a
cross to follow up on a point made by Mr. Mumma's counsel?
CROSS-EXAMINATION
BY MR. SONNENFELD:
Q Mr. Frey, it's your position that your
appointment as guardian ad litem would extend to the minor
children of any of the four children of the late Mr. Mumma?
A Yes.
Q And
A No. wait. Excuse me. I beg your pardon.
Not of the late Mr. Mumma, the children of Robert Mumma, II.
The late Mr. Mumma doesn't have any minor children.
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1 Q Either I didn't ask my question carefully
2 enough or you misunderstood me.
3 A Maybe I misunderstood you.
4 Q Is it your position that your appointment as
5 guardian ad litem would apply to any of the minor children
6 of any of the children; that is; any of the grandchildren of
7 the late Mr. Mumma?
8 A I think the order reads all minors, but it's
9 my understanding that there are no minor children nor will
10 there be any minor children of Robert Mumma's siblings that
11 are interested in the estate of Robert Mumma.
12 Now, maybe I didn't read his Will thoroughly
13 enough, but I checked the provisions this morning that deal
14 with the trust and distribution of it, and it refers to
15 living at the time of Mr. Mumma's death and not really at
16 the time of the life tenant's death.
17 Q Okay.
18 A If you follow me.
19 Q I follow you. And do you know whether there
20 are any of the other children of the late Mr. Mumma, the
21 three daughters, having children that were living at the
22 time of the late Mr. Mumma's death?
23 A I imagine they have, I don't know, but it's
24 my understanding that doesn't make any difference. Maybe
25 I'm not correctly interpreting his will. I have it here in
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1 front of me.
2 Q Well, let me just ask you a more general
3 question. Will you agree that you would have a
4 responsibility to treat equally any minor children for whom
5 you were acting as guardian ad litem in this matter?
6 A Yes, and to further answer that question, if
7 I am called upon to act as guardian ad litem for minors
8 other than the children of Robert Mumma, II, it is entirely
9 possible that I could have a conflict of interest and there
10 would need to be a different guardian ad litem appointed for
11 those other minor children if they were in the picture,
12 particularly if there were a sale of these assets to Robert
13 Mumma, II. I think that would create a conflict.
14 MR. SONNENFELD: That's the very point I was
15 trying to make, sir, but you agree with it. Thank you. I
16 have nothing further, Your Honor.
17 THE COURT: I have no questions. Mr. Frey,
18 you may step down. Mr. Frey, other than your father, do you
19 have any other additional witnesses you'd like to call on
20 your request for an injunction?
21 MR. FREY: No, I don't, Your Honor. I would
22 like to submit a brief based on our legal arguments, and
23 I've given it to the other counsel.
24 THE COURT: You may do that.
25 MR. FREY: Other than that, Your Honor, I
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1 have nothing further.
2 THE COURT: We'll take a recess until
3 twenty-five after ten.
4 (Whereupon, the testimony of Robert M. Frey
5 was concluded.)
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CERTIFICATION
I hereby certify that the proceedings are
contained fully and accurately in the notes taken by me on the
above cause and that this is a correct transcript of the same.
Du(Q ('t-ondltJ..
La ra F. Handle
Official Court Reporter
--------------------------------
The foregoing record of the proceedings on the
hearing of the within matter is hereby approved and directed to
be filed.
~,{ t, v '::>1 ") /C:;i?
V )/
2323