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HomeMy WebLinkAbout10-27-11In re the Edith S. Rife Trust : IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY, PENNSYL'~~NIA ~'? ORPHANS' COURT DIVISION ' ~-~ NO. 11-0325 ORHPANS' COURT ~_ ? ~ ~ _ NO. 10-1006 ORPHANS' COURT ~ '` _~ NO. 83-0773 ORPHANS' COURT _: ;, _~ _. _ . MOTION FOR RULE TO SHOW CAUSE ' AND NOW COMES Petitioner, John W. Maxwell, a remainder beneficiary of the Edith S. Rife Revocable Trust, by and through his attorney, James D. Cameron, and respectfully represents as follows: On March 8, 2011, Petitioner filed a Petition for Rule to Show Cause in the above-captioned matter, asking the Court to order the Executor of the Estate of Charles J. Rife ("the Executor") to file an accounting of the late Dr. Rife's administration of the Edith S. Rife Trust ("the Trust"). 2. By means of the same Petition, Petitioner also sought his appointment as successor Trustee of the Edith S. Rife Trust, as well as the cooperation of the Executor in the transfer of Trust assets and related information to the Successor Trustee. 3. On March 13, 2011, the Court issued the Rule to Show Cause Petitioner had requested. 4. On Apri126, 2011, the Court issued an Order setting a hearing on the Petition for Rule to Show Cause for June 17, 2011. 5. On June 7, 2011, Petitioner filed a Stipulation and Agreement between himself and Barry Maxwell, regarding their service as Successor Co-Trustees. 6. Following a hearing, on June 17, 2011, the Court issued a Decree directing the Executor to file an accounting of the administration of the Edith S. Rife Trust by Charles J. Rife within thirty (30) days; appointing John W. Maxwell and Barry Maxwell as Successor Trustees of the Edith S. Rife Trust; and directing the Executor to cooperate with the Successor Co-Trustees to facilitate the transfer to them of all assets, records and documents related to the Trust that were in the possession of the Executor. 7. In accordance with the Court's Decree, by means of a letter dated June 20, 2011, addressed to the undersigned, Murrell R. Walters, III., Esq., counsel for the Executor provided the Successor Co-Trustees with fiduciary income tax returns for the Trust for the years 2006 through 2010, a copy of the Trust Agreement, a reverse stock split notice, and two Allied Irish Banks, p.l.c., stock certificates titled in the name of the Trust. 8. On July 12, 2011, the undersigned met with Attorney Walters, to discuss the resolution of this case. Further, the undersigned and Attorney Walters engaged in subsequent correspondence related to an informal settlement. However, no settlement has been reached. 9. On September 17, 2011, Petitioner filed a Notice of Claim against the Estate of Charles J. Rife, related to his interest as a remainder beneficiary of the Trust. 10. The Executor has not filed an accounting as directed by the Court in its Decree of June 17, 2011 and it is believed that the decedent, Charles J. Rife, also the long-time Trustee, failed to maintain books and records of his administration sufficient to enable his Executor, Fred H. Jenkins, to file an account with the Court, in a form consistent with Pennsylvania Orphans' Court Rule 6.1. 2 11. Because the Executor has not filed an account, Petitioner has been unable to proceed by way of the filing of objections to an account. 12. Petitioner believes it is clear that Charles J. Rife breached his fiduciary duty as Trustee of the Edith S. Rife Trust, in the following respects: a. Charles J. Rife, Trustee, failed to terminate his Trusteeship and to transfer the assets of the Trust to Dauphin Deposit Bank and Trust Company (now Manufacturers and Traders Trust Company) upon the death of his mother, pursuant to the paragraph of the Revocable Trust agreement entitled " 2. Successor Trustee(s)", a copy of which is attached hereto, identified as "Exhibit A" (the entirety of the said trust agreement being Exhibit A of Petitioner's Petition for Rule to Show Cause, filed March 8, 2011); b. Charles J. Rife failed, as Trustee, to compel himself, as Executor of the Estate of his mother, to distribute the residue of his mother's probate Estate to the Trust pursuant to the residual clause (paragraph 3.) of the Will of Edith S. Rife (filed to Cumberland County docket number 21-83-773). Instead of notifying the named successor trustee, and transferring these additional assets to the Trust, he paid them to himself and his sister. A true and correct copy of the relevant portion of this Will is attached hereto, identified as "Exhibit B". A true and correct copy of Schedule J of the Pennsylvania Inheritance Tax Return for the Estate of Edith S. Rife, filed by Charles J. Rife, Executor, to number 21-83-773, is attached hereto, identified as "Exhibit C". c. Charles J. Rife, as Trustee, failed to diversify the investments of the Trust, allowing its sole asset-the shares of the stock of the successor trustee-to lose nearly all of their value. Copies of the two Allied Irish Banks, p.l.c., stock certificates titled in the 3 name of the Trust and the reverse split notice tendered by Attorney Walters to the undersigned are attached hereto, identified as "Exhibit D". d. Charles J. Rife, as Trustee, failed to keep adequate records of the Trust, with the consequence that his Executor is unable to construct a proper accounting, as ordered by the Court. WHEREFORE, Petitioner respectfully requests this Honorable Court to issue a Rule To Show Cause, directed to Fred H. Junkins, Executor of the Estate of Charles J. Rife, to show what cause, if any, he may have that the Court should not issue a Declaration that Charles J. Rife breached his fiduciary duty as Trustee of the Edith S. Rife Trust in the foregoing ways, and reserving the question of damages for further consideration by the Court. Respectfully Submitted, i / ~/ ~~1 , Jartpes ~. Cameron L/ Atto~ey LD. No. 58998 1325 North Front Street Harrisburg, PA 17102 (717) 236-3755 Attorney for Petitioner, John W. Maxwell 4 CERTIFICATE OF SERVICE I, JAMES D. CAMERON, Attorney for John W. Maxwell, hereby certify that I have served a true and correct copy of the foregoing Motion For Rule To Show Cause by first class mail, postage pre-paid, this 27~h day of October, 2011, addressed as follows: Murrell R. Walters, III, Esq. 54 East Main Street Mechanicsburg, PA 17055 Attorney for Fred H. Junkins, Executor Steven A. Maxwell 3141 North 350 E Huntington, IN 46750 Sherri Maxwell 7838 CR452 Cross Plains, TX 76443 Douglas Maxwell 112 Park Road Creswell, NC 27928 Barry Maxwell 305 Singing Hills Drive Pittsboro, NC 27312 / ~ ~i~ ~ ~-_.. Ja s .Cameron Attb ey LD. No. 58998 132 North Front Street Harrisburg, PA 17102 (717) 236-3755 Attorney for John W. Maxwell