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HomeMy WebLinkAbout04-16-09 (2)IN RE: ESTATE OF ROBERT M. : IN THE COURT OF COMMON PLEAS OF MUMMA, deceased :CUMBERLAND COUNTY, PENNSYLVANIA ORPHANS' COURT DIVISIOl'~ ~-.~ `~' t'r~ _- t i ~ N0.21-86-398 - ~ _:~ ~ :s7 y. j ~~~~ L: :~: Cl~ ~ CJ`1 _i, 1„J r ~7 -r7 _ T ~-~ ~ ~ , ~ ~ '~' i AUDITOR'S INTERIM REPORT, April 16, 2009 AND REQUEST FO~S~RDER~ . `~~ L. ~' ` tJa .. ._ To the Honorable J. Wesley Oler, Jr.: Your Honor has appointed me Auditor in the above captioned matter and charged me with reviewing the existing file and a multitude of prehearing issues raised by the parties and to schedule and hold a hearing as soon as scheduling permitted. A three day hearing has been scheduled in this matter for April 21-23, 2009. This hearing was to be held in the second floor Courtroom of the Old Courthouse, but was moved by the Court Administrator's Office to the Jury Assembly Room, 4t" Floor of the Courthouse. On April 7, 2009, Mr. Mumma filed a Motion to Stay Auditor's Hearing scheduled for April 21-23, 2009 and on April 9. 2009, Your Honor issued a Rule upon all interested parties to show cause why the relief requested by Mr. Mumma should or should not be granted. Your Honor's Rule was returnable within seven (7) days of your order. On April 15, 2009, the Executrices/Trustees, by and through their counsel filed and Answer opposing the granting of a stay. Your Honor has requested that I review this matter and propose an Order for the same. In Your Honor's February 27, 2009 pre-hearing discovery order, Your Honor ordered that "Counsel for the Executrices/Trustees shall disclose any and all foreign bank accounts, foreign safety deposit boxes, together with the status of Executrices/Trustees as shareholders to Objectors within ten (10) days of this Order." In response to your Order, counsel for the Executrices/Trustees wrote a letter to the Objectors, Mr. Mumma being one, and stated that 1 "Mrs. Mumma and Mrs. Morgan [the executrices] are not aware of any foreign bank accounts or safety deposit boxes owned by Robert Robert M. Mumma, Sr., as of the date of his death." Mr. Mumma claims this to be non-responsive and/or incomplete. A copy of the letter authored by George B. Faller, Jr. of the Martson Law Offices, sent to all interested parties, including the undersigned, is attached to this report. Mr. Mumma's current motion also claims that the response of the Estate counsel to the second paragraph of the Order (relating to the disclosure of the status of the Executrices/Trustees as shareholders) is also non-responsive and/or incomplete. However, the letter from counsel, specifically pages 2 through 5 sets forth, in detail, the interests held by the decedent at the time of his passing and the interests of the Executrices/Trustees. Mr. Mumma claims that detailing a party's interest in a corporation is not the same as disclosing a party's status as a shareholder. It is correct that they are not identical and that disclosing a detailed inventory of interests together with historical information is inclusive and more than simply disclosing the party's status. Therefore, the claim that the response of the estate was non- responsive and/or incomplete is misplaced and does not support the Motion to Stay. Mr. Mumma also claims that by providing a redacted copy of the estate counsel's bill for services which detail specific time and services rendered up and through the date of the accounting is not responsive to your Order. These were the only records in question at the time of the pre-hearing conference and the only records provided and reviewed by the undersigned. Mr. Mumma is requesting current bills for service, those for the past 2 `/2 years. Although I believe the estate has complied with the order, reasonableness of fees has been raised and I believe the estate should provide current record which relate to counsel fees. This factor alone is not enough to support a stay as I have advised the parties that this issue shall be last issue heard 2 by the undersigned and if the records are produced prior to or by the first day of hearing, it will grant the Objectors and any of their experts the opportunity to review the same. Mr. Mumma claims that the additional discovery documents relating to Estate and corporate records which were delivered to him do not constitute the "original documents" and are copies of those documents. As a result, Mr. Mumma claims the Estate's response regarding these records was non-responsive and/or incomplete. On March 17, 2009, Mr. Mumma, through counsel, wrote to the Estate's counsel requesting when and where Mr. Mumma could begin reviewing any warehoused estate and/or corporate records. On March 23, 2009, the Estate's counsel wrote to Mr. Mumma and all interested parties informing them of the documents the additional documents the estate was producing and stated, in part "Gentlemen, ... Given the timing and the relatively small number of documents (a few boxes) we plan to have the documents copied and delivered to both of you at your offices (unless you prefer another location of delivery) on Wednesday or Thursday. The originals of these documents will be available for inspection thereafter should you wish to review them." Signed Brady L. Green. On March 27 Attorney Green wrote Mr. Mumma and all interested parties. His note stated, in part: "This is to advise that we have additional documents for production in the above-referenced matter. They consist of five boxes of files pertaining to the operation and management of the properties and assets of Mumma Realty Associates I, Mumma Realty Associates II, D-E Distribution Corp., G-A-T Distribution Corp., the Estate and the Trusts.... In light of the timing, we can provide each of you with agates- tiered set of the documents (the likely timing would be early next week), or first make them a able for inspection. The documents presently are in our Philadelphia office. We also could make them available at a location in central Pennsylvania. If we provide you with copies, the originals would be available thereafter for 3 review. Please advise as to whether you would like us to send you a complete set of the documents." The estate has complied with Your Honor's Order and has provided the Objectors with copies of documents and have made the original's available for inspection. Mr. Mumma also raises the same matters he raised in his former Motion to Compel, Motion for Disclosure and Motion for Sanction which has been addressed in an earlier report and recommendation to Your Honor and do not support Mr. Mumma's current Motion to Stay Auditor's Hearing. Mr. Mumma also has listed ten (10) former motions or requests which he believes were not addressed and/or must be addressed prior to the Auditor's Hearing. Mr. Mumma then goes on to state that an evidentiary hearing should be convened to determine these issues prior to holding the Auditor's Hearing. In my interim report to Your Honor, the undersigned identified that certain matters would be deferred until the Auditor's Hearing and Your Honor directed the undersigned to address those matters during the hearing, which will be addressed at that time. I do not believe it wise or prudent to delay this matter or to hold a hearing to determine matters which can be more readily addressed during the scheduled hearing. Mr. Mumma and all Objectors have been afforded ample time to prepare for this hearing which has been scheduled for many months. Mr. Mumma offered no factual reason to support a stay of the scheduled hearing and has provided no legal authority supporting his position. Therefore based on the pleadings and the letters supplied to the undersigned I recommend the Motion to Stay be denied; however, that Your Honor further direct counsel for the Estate to 4 provide the Objectors with a copy of their fees charged to the estate for the period November 1, 2006 until the present. I recommend that if your Honor agrees with my recommendations, you enter an Order accordingly and I have attached a recommended order to accomplish the same. Respectfully submitted, Bucl~lky, Esquire, uditor Court ID# 38444 123'7 Holly Pike Carlisle, PA 17013 (717) 249-2448 JoeBLaw(cr~,aol.com =' MARTSON DEARDORFF WILLIAIVIS OTTO GILROY & FALLER MARTSON LAW OFFICES 10 EAST HIGH STRF~I' CARLISLE, PENNSYLVANIA 17013 TELEPHONE ('71'~ 243-3341 F.~c:su~niE (11'~ 243-1850 INTERNET' wwwmattsotdawcom Mr. Robert M. Mumma, II Box F Grantham, PA 17027 Mr. Robert M. Mumma, II 6880 SE Harbor Circle Stuart, FL 34996-1968 Mr. Robert M. Mumma, II 840 Market Street Suite 164 Lemoyne, PA 17043 March 9, 2009 WILLIAM F. MARTSON JOFnv B. FOVCI.ER III DnNIEI. K. DEARDORFF THOMAS J. WILLInMS* No V. GTTO III HUBERT X. CiII.ROY GEORGE B. FALLER JR.* 'Bonno Ceanne Ralph A. Jacobs, Esquire JACOBS & SINGER, LLC 1515 Market Street Suite 705 Philadelphia, PA 19102 Ms. Linda M. Mumma 212 North Duke Street Durham, NC 27701 Ms. Linda M. Mumma P.O. Box 480 Mechanicsburg, PA ,17055 RE; In re Estate of Robert M. Mumma, Deceased No. 21-86-398 -Cumberland County C.C.P. -Orphan's Court Our File No. 5844.1 Dear Ms. Mumma and Messrs. Mumma and Jacobs: DnvID A. FITZSIMONS CHRISTOPHER E. RICE JENNIFER L. SPEARS SETH T. MOSEBEY TRUDY E. FEHLINGER KATIE J. MAxwELI. JACOB I4I. TFIEIS n Cmc Tnw. SracuusT This letter will address. various items in the Court's Order dated February 26, 2009, in the above-referenced proceeding. ***** The Order directs that counsel for Barbara McK. Mumma and Lisa M. Morgan disclose any and all foreign bank accounts and foreign safety deposit boxes within ten days. As stated in their response to Robert M. Mumma, II's Further Motion for Disclosure of Decedent's Foreign Bank Accounts and/or Foreign Safe Deposit Boxes, Mrs. Mumma and Mrs. Morgan are not aware of any foreign bank accounts or safe deposit boxes owned by Robert M. Mumma, Sr., as of the date of his death. INFORMATION • ADVICE • ADVOCACY sM Mr. Robert M. Mumma, II Ralph Jacobs, Esquire Ms. Linda Mumma Mazch 9, 2009 Page 2 ***** The Order also directs that counsel for Mrs. Mumma and Mrs. Morgan shall disclose the status of Mrs. Mumma and Mrs. Morgan as shareholders within ten days. We understand this instruction to relate to Mr. Mumma, II's Further Motion for Disclosure of Executrices and/or Trustees' Status as Shazeholders. As Mrs. Mumma and Mrs. Morgan stated in their response to that motion, to the extent they are owners of interests in the corporations listed in Mr. Mumma, II's motion in their capacities as executrices or trustees, such interests result directly or indirectly from the stock ownership of Mr. Mumma, Sr. at the time of .his death. Mr. Mumma, Sr.'s ownership interests at the time of his. death in the listed corporations are set forth below, as are the origins of Mrs. -Mumma and/or Mrs. Morgan's individual interests. in those corporations. Middle Park, Inc. Interest of Estate/Trusts At the time. of his death, Mr. Mumma, Sr. did not duectly own any stock of Middle Park, Inc. However, Mr. Mumma, Sr. owned more than 98% of the stock of Pennsylvania Supply Company, which, in turn, owned 100,000 shares of the then-outstanding stock of Middle Park, Inc. On December 19, 1986, .Pennsylvania Supply Company was liquidated. At that time, the Estate became the owner of 14.01 % of the stock of Middle Park, Inc, Interest of Mrs. Mumma Mrs. Mumma and Mrs. Morgan are not presently awaze that Mrs. Mumma ever owned individually any stock in Middle Park, Inc. Interest of Mrs. Morgan Mrs. Morgan became a shareholder of Middle Park, Ina in 19b9, at which time 150,000 shares were issued to William Boswell for her in trust: At the time of Mr: Mumma, Sr.'s death, Mrs. Morgan's stock represented approximately 21.50% of the then-outstanding stock of Middle. Park, Ina She continued to hold that interest until the merger of Middle Park, Inc. into Bobali Corporation in 1987. Bobali Coraoration Interest of Estate/Trusts At the time of his death; Mr. Mumma, Sr. did not directly own stock of Bobali Corporation. At the time of the merger of Middle Park, Inc. into Bobali Corporation, the Estate, II3 PORMATIOl~i • 1~DVICE • Aavoc.~ce sna Mr. Robert M. Mumma, II Ralph Jacobs, Esquire Ms. Linda Mumma March 9, 2009 Page 3 by virtue of its ownership of 14.01% of the stock of Middle Park, Inc., became the owner of 14.01 % of the stock of Bobali Corporation. Interest of Mrs. Mumma Mrs. Mumma became a shareholder in Bobali Corporation pursuant to the terms of a written agreement with Linda M. Roth, from whom she acquired one-half of Ms. Roth's stock. Mrs.. Mumma acquired a total of 10.75% of the outstanding stock of Bobali Corporation, an interest she continues to own. Interest of Mrs. Morgan Mrs. Morgan became a shazeholder in Bobali Corporation at the. time of its 1987 merger into Middle Pazk,. Inc. At the time of the merger, Bobali Corporation was awholly-owned subsidiary of Middle Park, Ina. Under the terms of the merger, Mrs. Morgan, as the owner of approximately 21.50% of the stock of Middle Pazk, Inc., became the owner of an identical shaze of the stock of Bobali Corporation. She has continued to own that interest since that time. Lebanon Rock, Inc. Interest of Estate/'Trust Mr. Mumma, Sr. owned 50% of the- stock of this corporation at the time of his death, which interest passed into the Estate. The Estate's interest in Lebanon Rock, Inc., was sold to CRH plc in 1993. Interest of Mrs. Mumma Mrs. Mumma has never owned individually any stock of Lebanon Rock, Inc. Interest of Mrs. Morgan Mrs. Morgan has never owned individually any stock of Lebanon Rock, Inc. Hieh-Spec. Inc. Interest of Estate/Trusts Mr. Mumma, Sr: owned 50% of the stock of High-Spec, Inc. at the time of his death, which interest passed into the Estate. The interest subsequently was distributed to the Residuary Trust. INFORMATION ' ADVIGD hai'vonv". cu Mr. Robert M. Mumma, II Ralph Jacobs, Esquire Ms. Linda Mumma March 9, 2009 Page 4 Interest of Mrs. Mumma Mrs. Mumma has never owned individually any stock of High-Spec, Inc. Interest of Mrs. Morgan Mrs. Morgan has never owned individually any stock of High-Spec, Inc: Pennsv Supply Inc. As of the date of Mr. Mumma, Sr.'s death, the name of this corporation had been changed to Nine Ninety-Nine, Inc. Interest of EstateJTrusts Mr. Mumma, Sr. did not own stock in Nine Ninety-Nine,. Inc. at the time of his death. However, he owned more than 98% of the stock of Pennsylvania Supply Company, which, in tum owned approximately 83% of the stock of Kim Company. Kim Company owned 1,100 shares of 10% preferred stock in Nine Ninety-Nine, Inc., and 867 shares of its common stock. Upon the liquidation of Kim Company and Pennsylvania Supply Company in 1986, Mr. Mumma, Sr.'s Estate became the owner of common and 10% preferred stock of Nine Ninety-Nine, Inc. That stock was distributed to the Marital Trust in December 1987. By the time of the sale of the Pennsy Supply Businesses to CRH plc in July 1993, after transfers of Nine. Ninety-Nine, Inc. stock to Mrs: Mumma in satisfaction of exercises of her 5% withdrawal right under Mr. Mumma, Sr.'s Will, the Marital Trust owned 349.75 shares of the common stock of Nine. Ninety-Nine, Inc. and 576.97 shares of its 10% convertible preferred stock. Interest of Mrs. Mumma Mrs. Mumma was not a shazeholder of Pennsy Supply Inc. or of Nine Ninety-Nine, Inc, at any time prior to Mr. Mumma, Sr.'s death. She was, however, the owner of 106 shares of the stock of Kim Company, issued to her in 1947 and 1956. Upon the liquidation of Kim Company in 1986, shares of Nine Ninety-Nine, Inc. previously owned by Kim Company were distributed to Mrs. Mumma on a pro rata basis in respect. of her former interest in Kim Company. Thereafter, certain exercises of Mrs. Mumma's 5% withdrawal right under Mr. Mumma, Sr.'s will were satisfied by distribution to her of Nine Ninety-Nine, Inc. stock from the Marital Trust. At the time of the July 1993 sale of the Pennsy Supply Businesses to CRH plc, Mrs. Mumma owned 370.27 shares of the common stock of Nine Ninety-Nine, Inc., 142 shazes of its 8% preferred stock, and 336.54 shares of its 10% convertible preferred stock. All of Mrs. Mumma's interest in Nine Ninety-Nine, Inc. was sold to CRH plc in July 1993. 1 NFO RMA72 Orv 1'tDYi o~ - ADY09~-<+~- ~M ` Mr. Robert M. Mumma, II Ralph Jacobs, Esquire Ms. Linda Mumma March 9, 2009 Page 5 Interest of Mrs. Morgan Mrs. Morgan became a shazeholder of Pennsy Supply Inc. in 1963, when 312 shazes of common stock were issued to Mr. Mumma, Sr. in trust for her. In 1980, she was issued 312 shazes of common stock, replacing the stock previously held in trust. In addition, in 1982 Mrs. Morgan was issued 103 shazes of 8% preferred stock in Nine Ninety-Nine, Inc. Mrs. Mumma ceased to be a shazeholder of Nine Ninety-Nine, Inc. at the time of the sale of the Pennsy Supply Businesses io CRH plc in July 1993. ***** The Court's February 26 Order also directs counsel for Mrs. Mumma and Mrs. Morgan; if they have not already done so, to provide redacted copies of their fees for professional services provided to the Estate or the Trust within ten days. With the understanding that this portion of the Order refers to invoices unredacted copies of which were provided to Taylor Andrews, Esquire, for an in camera review, redacted copies previously were provided to Mr. Mumma, II and counsel for Barbara M. Mumma under cover of letter dated November 3,-2006. ***** We will respond to the remaining portions of the Court's order applicable to Mrs. Mumma and Mrs. Morgan shortly. very truly yours, MARTSON LAW OFFICES George B. Faller, Jr. GBF1mas cc: Joseph D. Buckley, Esquire Ms. Lisa Morgan Brady L. Green, Esquire INFORMATION fiDYIGL' fiDYpGncr -~