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HomeMy WebLinkAbout09-17-09No V. Otto, III, Esquire N I.D. No. 27763 n a ° :r -~{, George B. Faller, Jr., Esquire ~ ~ ~ ~,;- I.D. No. 49813 ;~-;~n -d ~'", _.` Jennifer L. Spears, Esquire _~' ~ ~ J ~>_ ~~ I.D. No.87445 ~ ~~~ ~" ~"~ MARTSON DEARDORFF W ILLIAMS OTTO GILROY & FALLER ~,~~ ~ z 'r` _Fry ._, MARTSON LAW OFFICES ~~~ ~ -~ ~~~' ~ 10 East High Street -a`i ~ ,~ ' f~-k~° Carlisle, PA 17013 y , N (717) 243-3341 Attorneys for Barbara McK. Mumma and Lisa M. Morgan IN THE COURT OF COMMON PLEAS OF IN RE: :CUMBERLAND COUNTY, PENNSYLVANIA Estate of Robert M. Mumma, NO. 21-86-398 Deceased. ORPHANS' COURT DIVISION RESPONSE OF BARBARA MCK. MOMMA AND LISA M. MORGAN TO MOTION TO PREVENT SALE OF REAL ESTATE BY TAX CLAIM BUREAU DUE TO NONPAYMENT OF TAXES BY EXECUTRICES/TRUSTEES Barbara McK. Mumma and Lisa M. Morgan, as executrices of and trustees of trusts created under the will of Robert M. Mumma, Sr., deceased, respond as follows to Barbara M. Mumma ("Babs")'s motion to prevent sale of real estate. The real estate that is the subject of the tax sales in question is not an asset of the Residuary Trust.1 Rather, it is owned by Bobali Corporation ("Bobali") Contrary to Babs' suggestion in her motion that it is "a substantial shareholder in" Bobali, the Residuary Trust owns only about 14% of the stock of Bobali. Babs herself owns more Bobali stock (more than 21 %) than does the Residuary Trust. Bobali has for many years lacked the funds necessary to pay real estate 1 Babs incorrectly suggests that Mr. Mumma, Sr.'s Estate owns stock in Bobali; in fact, the Estate's interest was distributed to the Residuary Trust. n taxes on the properties it owns. As a result, for a number of years, Mrs. Mumma, individually and though she is herself only a minority (less than 11 %) shareholder of the corporation, has advanced funds to Bobali to pay its taxes and prevent corporate real estate from being lost at tax sale. Babs also has paid the taxes on at least one occasion. Capital calls have been made to attempt to raise money from the shareholders. The latest such capital call, not mentioned by Babs in her motion, is attached. While some shareholders have agreed to contribute capital, others have failed to do so, leaving the corporation without sufficient funds to meet its tax obligations. Mrs. Mumma and Mrs. Morgan have for many years, as officers of Bobali, attempted to achieve an agreement among its shareholders to alter its financial situation. In early 2000, Mrs. Mumma and Mrs. Morgan noticed a meeting of the Bobali shareholders to discuss the corporation's lack of adequate cash to meet its obligations. A meeting was held on April 28, 2000, after one of the shareholders, Robert M. Mumma, II first objected to and filed suit seeking to enjoin the shareholders' meeting. A second meeting of the shareholders was held on June 28, 2000, and another on July 12, 2000.. In the course of these meetings, family member-shareholders expressed disagreement as to the ownership of the corporation's stock. Mr. Mumma, II purported to vote Bobali shares he claims are owned by Pennsylvania Supply Company, a corporation liquidated in 1986. Various shareholders have suggested - contrary to Babs' assertions in the instant motion - that neitherthe Estate northe Residuary Trust ever owned any Bobali stock. There is at present no agreement among Bobali's shareholders as to the ownership of its stock, the constitution of its board of directors or the identities of its officers. Given this backdrop, Babs' attempt to characterize Bobali's tax obligations as obligations of the Residuary Trust is inaccurate. The taxes are the obligation of the corporation, not of any of its minority shareholders. As a consequence, there is no basis upon which this court could properly order the Residuary Trust to pay taxes on behalf of Bobali, any more than it could order any of its other shareholders to do so. The failure to pay real estate taxes due on Bobali corporate real estate is not a failure of the Residuary Trust or of Mrs. Mumma and Mrs. Morgan as trustees; rather, it results from the shareholders' failure to invest the funds necessary to sustain the assets of the corporation. WHEREFORE, Barbara McK. Mumma and Lisa M. Morgan respectfully requestthis Honorable Gourt dismiss the Motion of Barbara M. Mumma. Respectfully submitted, MARTSON LAW OFFICES ~' By: No V. o II, Esquire I.D. No. 27763 George B. Faller, Jr., Esquire I.D. No. 49813 Jennifer L. Spears, Esquire I.D. No. 87445 10 East High Street Carlisle, PA 17013 (717) 243-3341 Date: September 17, 2009 Attorneys for Barbara McK. Mumma and Lisa M. Morgan YEI~.I,I,I~ jCATj~x The foregoing Response is based upon information which has bin gathered by my counsel in the preparation of the lawsuit. fihe language of the document is that of counsel and not my own. 1 have read the document and to the extent that it is beset} upon information which I have given to my counsel, it is true and correct to the best of my knowledge, information and belief. To the extent that the content of the docimnent is that of counsel, I have robed upon counsel im making this verification. This statement and verification arc made subject to the penalties of 18 Pa. C.S. Section X904 relating to unsworn falsification to authorities, which provides that if I make knowingly false averments, I may be subject to criminal penalties. ~,.. - Lisa M. Mangan CERTIFICATE OF SERVICE I, Tricia D. Eckenroad, an authorized agent of Martson Law Offices, hereby certify that a copy of the foregoing Response was served this date by a-mail and depositing same in the Post Office at Carlisle, PA, first class mail, postage prepaid, addressed as follows: Mr. Robert M. Mumma, II Box F Grantham, PA 17027 Mr. Robert M. Mumma, II 840 Market Street, Suite 164 Lemoyne, PA 17043 Mr. Robert M. Mumma, II 6880 S.E. Harbor Circle Stuart, FL 34996-1968 Brady L. Green, Esquire MORGAN, LEWIS & BOCKIUS LLP 1701 Market Street Philadelphia, PA 19103-2921 (Attorney for Estate and Executrixes) Ms. Linda M. Mumma 212 North Duke Street Durham, NC 27701 Pro Se Ms. Barbara Mann Mumma 541 Bridgeview Drive Lemoyne, PA 17043 Pro Se Joseph D. Buckley, Esquire 1237 Holly Pike Carlisle, PA 17013 (Court Appointed Auditor) MARTSON LAW OFFICES ~~' f By Tri a D. Ecke road 10 East High treet Carlisle, PA 17013 Dated: September 17, 2009 (717) 243-3341