HomeMy WebLinkAbout08-30-13 , *
IN RE: ESTATE OF ROBERT : IN THE COURT OF COMMON PLEAS OF
M. MUMMA, Deceased : CUMBERLAND COUNTY, PENNSYLVANIA
: ORPHANS' COURT DIVISION
: NO. 21-86-398 c� =_�= �. '��y
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IN RE: OPINION PURSUANT TO PA. R.A.P. 1925 �`�-, � f. � '
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OLER, S.J., August 30, 2013. � =�; ",. ° -
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On the eve of the filing of the auditor's report in this 1986 deceden�s�st�ate c�e,l�'. �.�
three interim orders entered by this court pursuant to recommendation o�he alfd�tor: � ''!`
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have been added to the long list of interim orders that have been appealed bp-an �`
individual who is a beneficiary of the estate of his deceased father and a remainderman of
trusts created under his father's will.2 One of his sisters has also filed an appeal from one
' See Order of Court, July 19, 2013. The auditor's report, which followed about 40 days of hearing and
comprises 130 pages,has now been filed. Report of Auditor, filed August 7, 2013.
2 Last Will and Testament of Robert M. Mumma.
See Notice of Appeal, filed by Robert M. Mumma, II, filed June 10, 2013, from Order dated May 6,
2013 (relating to sale of"UPS Drive Property"), docketed by Superior Court at No. 1027 MDA 2013;
Notice of Appeal, filed by Robert M. Mumma, II, filed June 10, 2013, from Order dated May 6, 2013
(relating to liquidation of real estate in marital and residuary trusts), docketed by Superior Court at No.
1028 MDA 2013);Notice of Appeal, filed by Robert M. Mumma, II, filed July 8, 2013, from Order dated
June 5, 2013 (relating to motion to compel compliance with or vacate order entered in 2012),docketed by
Superior Court at No. 1222 MDA 2013.
The appeals docketed at No. 1027 MDA 2013 and 1028 MDA 2013 have been consolidated by the
Superior Court at No. 1027 MDA 2013.
The Superior Court has aptly characterized appellant's conduct in this estate as "litigious." Opinion,
dated February 2012,No. 481 MDA 2011. With regard to appellant's prior appeals in this case alone,see,
e.g., Notice of Appeal, filed September 15, 2005 (appeal quashed by Superior Court by order dated
October 28, 2005, at No. 1546 MDA 2005);Notice of Appeal, filed January 14, 2009 (appeal quashed by
Superior Court by order dated March 27, 2009, at No. 270 MDA 2009;Notice of Appeal, filed March 14,
2011 (order affirmed by Superior Court by order dated February 22, 2012, at No. 481 MDA 2011);
Notice of Appeal, filed January 12, 2012, (appeal quashed by Superior Court by order dated October 19,
2012, at No. 97 MDA 2012). Appellant is also engaged in litigation against his recently deceased
mother's estate in Florida.See N.T. 88, Hearing, January 28, 2011; RMM Exhibit 1, Hearing, January 28,
2011 (objections filed in mother's estate).
In addition to numerous periods in which appellant has proceeded pro se, he has variously been
represented by at least 15 different attorneys. The docket entries in the estate, which are recorded at two
different docket numbers, now extend to 92 pages. See"Register of Wills"Docket(entries from 1 to 185)
and"Orphans' Court"Docket(entries from 1 to 760),Estate of Robert M. Mumma, 1986-398.
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of the orders.3 Whether these appeals are interlocutory is beyond the scope of this
opinion.4
One of the interim orders appealed authorized the sale by the estate's executor and
trustee of a certain piece of real estate known as the "UPS Drive Property."5 Another of
the orders appealed authorized the trustee to proceed generally with a plan of liquidation
of real estate owned by the marital and residuary trusts established under the decedent's
wi11.6 The third order appealed declined to revisit an order entered in July of 2012
authorizing the surrender of certain corporate-owned life insurance policies and
distribution of the proceeds to shareholders in accordance with their proportional interests
in the corporation.�
With respect to the first and second interim orders appealed from, identical three-
page statements of errors complained of on appeal filed by the said beneficiary read as
follows:
1. The Appealed Order was entered in violation of Local Orphans' Court Rule
7.1, allowing 20 days for objections.
2. The Auditor's "interim report and recommendation" of relief prior to or apart
from confirmation of an account and proposed distribution, exceeds the authority granted
It has been estimated by the auditor that litigation occasioned by this appellant in federal and state
courts has resulted in attorney's fees far the decedent's estate and its executrices/trustees in excess of five
million dollars.See Report of Auditor,¶444, filed August 7,2013.
3 See Notice of Appeal, filed by Barbara M. Mumma, filed June 4, 2013, from Order dated May 6, 2013
(relating to liquidation of real estate in marital and residuary trusts), docketed by Superior Court at No.
1003 MDA 2013.
4 As a general rule, in a decedent's estate "the confirmation of the final account of the personal
representative represents the final order, subject to exceptions being filed and disposed of by the court.
See 20 Pa. C.S. §3514." In re Estate of Borkowski, 2002 PA Super 57, ¶7, 794 A.2d 388, 389-90; see
generally In re Estate of Quinn, 805 A.2d 541 (Pa. Super. 2002) (appeal from order directing partial
distribution quashed as interlocutory).
5 See Order of Court,May 6, 2013;Notice of Appeal, filed by Robert M. Mumma,II, June 10, 2013. This
appeal is docketed at No. 1027 MDA 2013.
6 See Order of Court, May 6, 2013; Notice of Appeal, filed by Robert M. Mumma, II, June 10, 2013;
Notice of Appeal, filed by Barbara M. Mumma, filed June 4, 2013. These appeals are docketed
respectively at No. 1028 MDA 2013 and No. 1003 MDA 2013.
' See Order of Court, June 5, 2013; Notice of Appeal, filed by Robert M. Mumma, II, July 8, 2013. This
appeal is docketed at No. 1222 MDA 2013.
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an auditor and violates applicable rules and statutes governing auditors, e.g., Supreme
Court Orphan's Court Rule("O.C.R.") 8.4 and 20 Pa.C.S.A. §3514.
3. The relief recommended by Auditor and granted in the Appealed Order is
beyond the subject matter jurisdiction of the Orphans' Court to the extent it concerns the
disposition or distribution of assets that are not property of the Estate and/or are property
of others not parties to the proceedings.
4. The relief recommended by Auditor and granted in the Appealed Order is
contrary to Appellant's prior Objections to the Audits and Estate Inventory and unfairly
prejudices Appellants substantive and procedural rights relating to those prior Objections.
5. Appellee Morgan lacked standing to request the relief sought in the
Liquidation petition and allowed by the Appealed Order.
6. The relief recommended by Auditor and granted in the Appealed Order was in
violation of the express terms of Items SEVENTH and EIGHTH of the Will which
mandate that the assets of the Estate and Trusts be distributed to the beneficiaries upon
the death of Barbara McKimmie Mumma, "as it is then constituted. . ."
7. The relief recommended by Auditor and granted in the Appealed Order
violated the terms of the agreements governing the assets of Mumma Realty Associates
(the"MRA Agreements"),.
8. The relief recommended by Auditor and granted in the Appealed Order is
arbitrary and unsupported by evidence or good cause. The auditor cites only one reason
for the relief(the need to fund administration expenses) but elsewhere acknowledges that
need no longer exists (the expenses were met by the DE policy proceeds). There is no
accounting or evidence concerning the disposition of the proceeds of those policies paid
to the Trust and no accounting of cunent expenses.
9. The process before the Auditor and Orphan's Court resulting in the Appealed
Order were in violation of Appellant's rights of due process under the Constitutions of
the United States and Commonwealth of Pennsylvania.$
g Appellant's Concise Statement[s] of Issues on Appeal(PA.R.A.P. 1925(b)),filed July 10,2013.
An eight-page statement of errors complained of on appeal,which is in the nature of a brief and purports
to incorporate another document as well, has been filed by a sister of the said beneficiary with respect to
her appeal of the second interim order,reading as follows:
a. Whether the Trial Court erred in entering the Order prior to the time expressly
set forth in C.C.O.C.R. Local Rule 8.7-2 for the expiration of the date on which timely
objections to the report were to be filed. Local Rule 8.7-2, which is published on the
Court's own website,expressly provides: "Objections to the auditor's report shall be filed
with the Clerk within twenty days after receipt of the notice of filing of said report." The
error is not harmless, because Appellant Barbara M. Mumma filed and served timely
objections to the auditor's report. (Docket No. 716). See, e.g., Anthony Biddle
Contractors, Inc. v. Preet Allied American Street, L.P. 28 A.3d 916, 925 (Pa. Super.
2011)("the provisions of local rules of procedure must also be applied and interpreted in a
manner that is consistent with the fairness mandated by Pa. R.C.P. 126"). See also Perez
v. Pritz, 67 York 47, 48 (C.P. York Co. 1953)("There can be no use whatever in making
local rules for the regulation of the practices of the Court unless we adhere to them.");
United States v. Diaz-Villafane, 874 F.2d 43,46(lst Cir. 1989)("Let us be perfectly clear.
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. . . Once local rules have been promulgated, lawyers and their clients have a right to
place reasonable reliance on them.")
b. Whether the Trial Court's error in entering the Order expressly set forth in
C.C.O.C.R., Local Rule 8.7-2 for the expiration of the date on which timely objections to
the report were to be filed constitutes a denial of due process of law in violation of the
Pennsylvania and United States Constitutions. It is axiomatic that due process of law
requires that litigants be provided a"fair opportunity to be heard." City of Philadelphia v.
Fraternal Order of Police Lodge No. S, 985 A.2d 1259, 1269 (Pa. 2009) There, the
Supreme Court of Pennsylvania held, in the context of an arbitration proceeding,that"all
decision-making tribunals, including arbitrators, must conduct proceedings in accordance
with the mandates of due process under the Pennsylvania and United States
Constitutions." Id. at 1266. Here, despite the express provisions of the local rules of
court, Appellant Barbara M. Mumma had no opportunity to be heard at all with respect to
her objections to the auditor's report, because the Trial Court entered the Order
prematurely and without waiting to determine whether timely objections would be filed.
See, e.g., Byard F. Brogan, Inc. v. Holmes Electric Protective Co. of Philadelphia, 460
A.2d 1093, 1096 (Pa. 1983)("A lawsuit is a judicial process calculated to resolve legal
disputes in an orderly and fair fashion. It is imperative that the fairness of the method by
which the resolution is reached not be open to question.").
c. Appellant Barbara M. Mumma respectfully submits that the Trial Court erred
as set forth above by entering the Order without waiting to determine whether timely
Objections to the auditor's report would be filed. Thus, the Trial Court entered the Order
without considering or deciding both timely and meritorious Objections which were filed
on behalf of Appellant Barbara M. Mumma. In the event that the Trial Court or, on
appeal, the Superior Court of Pennsylvania, chooses to reach the merits of the timely
Objections filed on behalf of Appellant Barbara M. Mumma, then Appellant Barbara M.
Mumma hereby incorporates herein her Objections as filed (Docket No. 716) in order to
preserve the issues set forth therein in the event that the Superior Court reaches the
substantive issues set forth in the Objections. Mindful of the mandates of Pa. R.A.P.
1925(b)(4)(iii-v), Appellant Barbara M. Mumma will merely summarize the Objections
herein.
(1) The Court erred in entering the Order because the Interim Report
recommended excessive and premature relief beyond that sought by or
warranted by the Petition which led to the Interim Report,recommending
that the trustee, Lisa Morgan, be authorized and directed to proceed with
a plan of liquidation of the remaining assets of the trust. As set forth in
the Objections, the Court erred in entering the Order and the auditor
erred because there remain objections pending to the accountings filed
which have not been ruled upon, because the auditor(and now the Court
as well) appears to authorize the trustee to perform actions which are
outside the jurisdiction of the Court because they affect corporate entities
not before the court, and because the Court now appears to have
authorized the trustee to perform acts and liquidate assets which were far
beyond the relief requested in the petitions and, in at least one instance,
was expressly disclaimed by counsel for the trustee.
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With respect to the third interim order appealed from, a statement of errors
complained of on appeal filed by the said beneficiary reads as follows:
Pursuant to Pa.R.A.P.No. 1925(b)(4)(vi), Appellant states that because the Court
did not provide the particular reasons for the Appealed Order, Appellant cannot readily
discern the basis for the Court's decision beyond the general terms of the Appealed
Order, and accordingly frames it [sic] statement of issues on appeal in similarly general
terms. The difficulty in discerning the reasons for the Appealed Order is compounded by
the nature of the Petition that gave rise to the Appealed Order: a Petition to vacate a prior
Order date July 30, 2012 ("Prior Order") which was entered on the basis of the
recommendation of an auditor, Joseph Buckley, Esquire(the "Auditor")for interim relief
on a Petition to Authorize a Plan of Liquidation (the "Liquidation Petition") filed by
Appellee Lisa M. Morgan ("Appellee Morgan") as Trustee of a Trust under the Will of
Robert M. Mumma, Decedent in the captioned Estate. With this preface, Appellant states
as follows:
1. The Orphans' Court and Auditor lacked subject matter jurisdiction to authorize the
liquidation of insurance policies that were not property of the Estate or Trust before
it,and the Prior Order is therefore void.
2. DE Distribution was a necessary and indispensable party to the proceedings,
depriving the Court and Auditor of subject matter jurisidction [sic].
3. The Prior Order was entered in violation of Local Orphans' Court Rule 7.1, allowing
20 days for objections.
4. The Prior Order improperly relied on an Auditor's interim recommendation and
report that exceeded the authority granted an auditor and violated applicable rules
(2) The Court erred in entering the Order because there was no need
shown in the auditor's interim report or in the petition for liquid assets
beyond those already received by the Trust following the entry by the
Court on July 30, 2012 of an Order authorizing the cancellation,
redemption or redemption of certain life insurance policies owned by D-
E Distribution Corporation(see Docket Nos. 682-684), which had a cash
value in excess of$2,000,000.
(3) The Court erred in entering the Order because the auditor's report
made recommendations which violate the intent of the testator with
respect to the distribution of assets to the beneficiaries of the trusts. The
Will of Robert M. Mumma provides, in pertinent part, that upon the
death of his widow, Barbara McK. Mumma, who died on July 17, 2010,
the principal of the trust, as it was then constituted, was to be paid over
to his four children, "share and share alike, per stirpes and not per
capita." See, e.g., In re Hirt, 832 A.2d 438, 448 (Pa. Super. 2003)("the
polestar in every trust is the settlor's intent and that intent must prevail");
Restatement(Third)of Trusts, § 79(2007). . . .
Concise Statement of Errors Complained of on Appeal by Appellant Barbara M. Mumma, filed
June 27,2013.
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_ �., � �.�,� e . _ . .
and statutes governing auditors, e.g., Supreme Court Orphan's Court Rule("O.C.R.")
8.4 and 20 Pa.C.S.A. §3514.
5. The relief recommended by Auditor and granted in the Prior Order is contrary to
Appellant's prior Objections to the Audits and Estate Inventory, and to the
Liquidation Petition, and unfairly prejudices Appellant's substantive and procedural
rights relating to those prior Objections.
6. Appellee Morgan lacked standing to request the relief sought in the Liquidation
Petition and allowed by the Prior Order.
7. The relief recommended by Auditor and adopted in the Prior Order was in violation
of the express terms of Items SEVENTH and EIGHTH of the Will which mandate
that the residue of the Estate and Trusts be distributed to the beneficiaries upon the
death of Barbara McKimmie Mumma, "as it then constituted. . ."
8. The relief recommended by Auditor and adopted in the Appealed Order is arbitrary
and unsupported by evidence or good cause. Specifically, there was no enforceable
agreement by Appellant Robert M. Mumma, II to liquidation of the insurance
policies at issue.
9. The Prior Order is invalid and unenforceable due to lack of proper service and notice
of entry to Appellant.
10. The Orphans' Court erred in not vacating the Prior Order.
11. The Orphans' Court erred in not allowing Appellant additional time for discovery on
the Petition to Vacate.
12. The Orphans' Court erred in not considering the Affidavit of Jeffrey Brooks,Esquire.
13. The Orphans' Court erred in not granting the Petition to Supplement the Record.9
This opinion in support of the orders appealed from is written pursuant to
Pennsylvania Rule of Appellate Procedure 1925(a).
STATEMENT OF FACTS
Overview of early history of this case. The early history of this estate has been
related in the contexts of multiple prior appeals to the Superior Court in an opinion
written by the Honorable George E. Hoffer, former President Judge, in 2000,10 and in
opinions written by the undersigned judge dated July 15, 2005,11 November 4, 2005,12
November 8, 2006,13 December 8, 2008,14 May 31, 2011,15 and May 14, 2012,16
9 Appellant's Concise Statement of Issues on Appeal(Pa.R.A.P. 1925(b)), filed July 30, 2013.
'o See In re: Estate of Robert M. Mumma, No. 21-86-398 (Ct. Com. Pl. Cumb. Feb. 23, 2000) (Hoffer,
P.J.), appeal quashed, 776 A.2d 300(2001)(table decision).
11 See In re:Estate of Robert M. Mumma, In re: Opinion Pursuant to PA. R.A.P. 1925,No. 21-86-398 (Ct.
Com. Pl. Cumb. Jul. 15, 2005).
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,.�� �., _a.� ,.. .�:., ,.
On January 6, 1999, Robert M. Mumma, II . . . petitioned this court for an
accounting of the estate of his father, Robert M. Mumma, Sr. . . , who died testate on
April 12, 1986. The decedent's will and the codicil thereto were probated on June 5,
1986. The will appoints Mrs. Barbara McK. Mumma, decedent's widow [now also
deceased], and Lisa M. Morgan [decedent's daughter] . . . as executrices thereof and as
trustees of a Marital Trust and a Residuary Trust created thereunder . . . . Under the will,
the presumptive remaindermen of the Trusts, if they survive Mrs. Mumma, are the
decedent's children: petitioner Robert M. Mumma II, Linda M. Mumma, Barbara M.
Mumma and Mrs. Morgan. The decedent bequeathed to his testamentary trustees an
amount equal to fifty percent of his total gross estate to be held in trust exclusively for the
benefit of his wife during her lifetime, the principal to be distributed to the decedent's
children upon her death. In addition, the decedent gave his residuary estate to his
testamentary trustees to be held in trust exclusively for the benefit of his wife during her
lifetime,the principal to be paid to the decedent's children upon her death.
[Decedent's widow and Mrs. Morgan] filed interim accounts of their acts and
transactions as executrices and as trustees on August 9, 1991 . . . .
[Robert M. Mumma, II,] disclaimed his interest under the will in 1987. In 1989,
former President Judge Harold E. Sheely of this court granted petitioner's motion to
revoke his disclaimer. [Robert M. Frey, Esq.], who was appointed guardian ad litem for
the minor persons interested in the Estate in 1988, appealed the revocation of the
disclaimer. The Superior Court ruled that Mr. Frey's representation of the estate with
respect to the revocation of the disclaimer was beyond the scope of his limited
appointment and therefore he lacked standing to appeal.
[Robert M. Mumma, II, eventually] ask[ed] for a complete accounting of the
Estate, including an accounting of the Trusts in which [he] claim[ed] an interest.
[Decedent's widow and Mrs. Morgan] claim[ed in response that] they [could not] provide
an accounting to [Robert M. Mumma, II] because he [did] not have standing, and the
issue of the revocation of[hisJ disclaimer ha[d] not been fully litigated . . . ."
12 See In re:Estate of Robert M. Mumma, In re: Opinion Pursuant to PA. R.A.P. 1925,No. 21-86-398 (Ct.
Com. Pl. Cumb.Nov. 4,2005).
13 See In re:Estate of Robert M. Mumma, In re: Opinion Pursuant to PA. R.A.P. 1925,No. 21-86-398 (Ct.
Com. Pl. Cumb.Nov. 8,2006).
'a See In re:Estate of Robert M. Mumma, In re: Opinion Pursuant to PA. R.A.P. 1925,No. 21-86-398(Ct.
Com. Pl. Cumb. Dec. 8,2008).
's See In re:Estate of Robert M. Mumma, In re: Opinion Pursuant to PA. R.A.P. 1925,No. 21-86-398 (Ct.
Com. Pl. Cumb. May 31, 2011).
16 See In re: Estate of Robert M. Mumma, In re: Opinion Pursuant to PA. R.A.P. 1925,No. 21-86-398(Ct.
Com. Pl. Cumb. May 14, 2012).
"In re Estate of Robert M. Mumma, No. 21-86-398, slip op. at 7-8, (Ct. Com. Pl. Cumb. May 31, 2011);
In re Estate of Robert M. Mumma, No. 21-86-398, slip. op. at 2(Ct. Com. Pl. Cumb.Nov. 4, 2005),citing
In re Estate of Robert M. Mumma, No. 21-86-398, slip op. at 1-3 (Ct. Com. Pl. Cumberland Feb. 23,
2000)(Hoffer,P.J.)(citations omitted).
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The position of the executrices/trustees was rejected by the court, and an
accounting by the executrices/trustees was ardered on February 23,2000 . . . ."�S
An e�austive further history of the estate, to the current date, is now available by way of
a 130-page final auditor's report, filed August 7, 2013.
The first interim order referred to above, authorizing the sale of realty known as
the UPS Drive Property, had its inception in a Petition To Authorize Plan of Liquidation
filed on April 5, 2012, by the decedent's daughter, Lisa M. Morgan, Esq., who had been
appointed by her father as executrix and trustee of marital and residuary trusts under his
wi11,19 followed by a Petition To Authorize Sale of Real Estate in the testator's residuary
trust filed by Ms. Morgan on May 30, 2012,20 followed by a Supplemental Petition To
Sell Real Estate filed by Ms. Morgan on August 28, 2012.21 The petitions related, in
whole or in part, to a request to sell a certain piece of realty (the UPS Drive Property),
which had been appraised in 2010 at $205,000.00, for $350,000.00. It may be noted that
real estate alone in the marital and residuary trusts in this multi-million dollar estate22 was
appraised in 2010 at almost $20,000,000.00.23
The order being appealed was issued in accordance with a 30-page interim report
and recommendation of the auditor, to whom the issue had been referred. The interim
report and recommendation (a) followed a lengthy proceeding conducted by the auditor
in which the arguments of the parties on the issue of the proposed sale were placed on the
18 In re Estate of Robert M. Mumma, No. 21-86-398, slip op. at 8 (Ct. Com. Pl. Cumb. May 31, 2011); In
re Estate of Robert M. Mumma, No. 21-86-398, slip. op. at 2-3 (Ct. Com. Pl. Cumb. July 15, 2005, citing
In re Estate of Robert M. Mumma, No. 21-86-398, slip. op. at 1-3 (Ct. Com. Pl. Cumb. Feb. 23, 2000)
(Hoffer,P.J.),appeal quashed, 776 A.2d 300(2001)(table decision).
19 petition To Authorize Plan of Liquidation, filed April 5, 2012.
20 Petition To Authorize Sale of Real Estate, filed May 30,2012.
21 Supplemental Petition To Authorize Sale of Real Estate, filed November 28, 2012.
ZZ It has been reported that one business alone in which the estate had an interest was sold to CRH
Industries for $32,000,000.00, plus an option of $2,000,000.00 for further acquisitions. See Report of
auditor,¶167, filed August 7, 2013.
Z3 See E�ibit"A,"Petition To Authorize Sale of Real Estate, filed May 30, 2012.
8
record24 and (b) contained a thorough analysis of those positions. The order
recommended by the auditor was entered by the court without solicitation of further
argument, in accordance with a practice employed for such intermediate orders on at least
18 prior occasions25 in the course of the administration of this estate:
AND NOW, this 6th day of May, 2013, upon the recommendation of the Auditor
in this case it is hereby ordered that the Petition of Lisa M. Mumma [Morgan] to
authorize the sale of the real property owned by the Estate of Robert M. Mumma, located
on UPS Drive in Dauphin County and commonly referred [to] by the parties as "the UPS
Property" is hereby granted.
The entry of this order was consistent with a recognition of Ms. Morgan's
discretionary fiduciary powers and duties under her father's will, which were
acknowledged by the Superior Court in the context of an earlier attempt by her brother to
thwart her administration by the device of disqualification:
With respect to the distribution of assets to the four sibling beneficiaries,the trial
court determined that Morgan's testimony established she is completing the process of
obtaining valuations of the estate and trust assets and has asked the beneficiaries if they
have a preference regarding the receipt of any particular assets or cash and that she
intends to make an equitable distribution of the assets to the beneficiaries after collecting
the information. We agree with the trial court that this approach does not constitute any
breach of fiduciary duty. Mumma, Sr. specifically provided Morgan, in her role as his
personal representative when making an equal distribution among the four sibling
beneficiaries, with the power to decide how to "make distribution of any trust herein
created, either in money or in kind, or partly in money and partly in kind." Item Ninth
(10), quoted supra. Mumma, Sr. further indicated that the "judgment of the trustees as to
what shall constitute an equitable distribution or apportionment shall be binding and
conclusive upon the beneficiaries hereo£"26
Although court approval of the sale was not legally required, the unfortunate
dynamics of this estate have resulted, as Ms. Morgan's counsel suggested, in a situation
where no reasonable buyer would be willing to spend $350,000.00 on an asset from it
without a court order sanctioning the transfer.27 Objections raised to the sale of this realty
z4 The transcript of this proceeding indicates that it was held in a courtroom and lasted for more than three
hours.See Transcript,Auditor's Hearing, July 26, 2012.
25 See Orphans' Court Docket Entry Nos. 148, 158 and 159, 396 and 397, 414 and 419, 418 and 420, 425
and 428, 426 and 429, 437 and 438, 457 and 460, 481 and 483, 482 and 484, 496 and 498, 507 and 509,
603 and 610-613, 626 and 628-630, 640 and 642,681 and 682-684, 708 and 713-715.
Z6 In re Estate ofMumma, 2012 PA Super 41, 41 A.3d 41, 50.
27 N.T. 43,Auditor's Hearing, July 26, 2012.
9
at a price far in excess of its appraised value, such as the sale's possible diminution of the
value of another piece of estate realty, were either unsupported by any competent
evidence from which such a conclusion could justifiably be drawn,28 or legally
untenable,29 or both. A full explication of the rationale for the order is contained in the
auditor's interim report and recommendation, a copy of which is appended to this opinion
for purposes of incorporation and ease of reference.
The second interim order referred to above also had its inception in the aforesaid
Petition To Authorize Plan of Liquidation filed on April 5, 2012, by Ms. Morgan. The
petition recounted the more than quarter-century history of the estate without closure and
the lack of cooperation of the remaindermen of the estate's marital and residuary trusts
with the trustee's attempts to proceed with a liquidation of assets following the trusts'
terminations, and sought permission of the court to proceed with an orderly liquidation of
the same.3o
The purpose of this petition, in light of the history of obstruction of Ms. Morgan's
administration of the estate, was explained by her counsel as follows:
[A]bsent an agreement, what Mrs. Morgan is asking for leave to do is exactly
what would be necessary. It's not as though these assets will be sold in a heartbeat.
They're not going to be liquidated at a fire sale value.
I don't perceive that there's any real risk that she'll sell the properties at below
value or what have you. Any fiduciary could do that. But, of course,that's why we have a
fiduciary duty, that's why we have the standards and the ability to surcharge a fiduciary
who runs am[o]k.
But the process should begin, and Mrs. Morgan should be at liberty to be able to
discuss with potential buyers and talk with potential buyers or even feel out the market or
have someone do it on her behalf with the knowledge that she has the authority to
deliver.31
As with the first interim order discussed above, the second interim order being
appealed was issued in accordance with the aforesaid 30-page interim report and
28 See N.T. 54-55,Auditor's Hearing, July 26,2012.
29 See N.T. 60,Auditor's Hearing,July 26,2012.
3o See Petition To Authorize Plan of Liquidation,filed Apri15, 2012.
31 N.T. 86,Auditor's Hearing,July 26, 2012.
10
recommendation of the auditor, to whom the issue had been referred. As before, the
interim report and recommendation (a) followed a lengthy proceeding conducted by the
auditor in which the arguments of the parties on the issue were placed on the record32 and
(b) contained a thorough analysis of those positions. The order recommended by the
auditor was entered by the court without solicitation of further argument in accordance
with a practice employed by the court for such intermediate orders on at least 18 prior
occasions33 in the course of the administration of this estate:
AND NOW, this 6th day of May, 2013, upon the recommendation of the Auditor
in this case it is hereby ordered that the request of Lisa M. Morgan,that she be authorized
to proceed with a plan of liquidation is hereby granted. Lisa M. Morgan is authorized and
directed to proceed with a plan of liquidation of the assets remaining in the trust
established under the Seventh Section and the Eighth Section of the Last Will and
Testament of Robert M. Mumma, and following receipt by this Court of its Order
regarding the accounts previously filed to distribute then re[mai]ning assets among and
between the named beneficiaries: Robert M. Mumma II, Barbara M. Mumma, Linda
Mumma, and Lisa M. Morgan in equal shares without further order of this Court.3a
Again, court approval of the liquidation process was not required under the terms
of the will sub judice, and as the Superior Court indicated in the context of a prior
challenge to Ms. Morgan's fiduciary conduct she was not obliged to attempt the
impossible task of an immediate in-kind division of assets among the disputatious
remaindermen upon the trusts' terminations. The order now on appeal does not purport to
adjudicate title to specific items of property or to dispose of the myriad of objections that
have been filed to accounts in this matter.35 Distributions by the trustee inconsistent with
the ultimate resolution of those objections would obviously involve a personal risk that
she might not choose to incur in the absence of satisfactory releases.36
32 The transcript of this proceeding indicates that it was held in a courtroom and lasted for more than three
hours.See Transcript, Auditor's Hearing, July 26, 2012.
33 See note 25,supra.
3a Order of Court,May 6, 2013 (emphasis added).
35 It is noted that the final 130-page auditor's report in this case, filed as of August 7, 2013, does
recommend that all the objections be dismissed.See Report of Auditor at 126.
36 It may be noted, however, that the final auditor's report has recommended that all of the objections be
dismissed and the accounts confirmed.
11
The final interim order referred to above also had its inception in the aforesaid
Petition To Authorize Plan of Liquidation filed on April 5, 2012, by Ms. Morgan. The
petition recited the ownership interests of the parties herein in a company known as D.E.
Distribution Corporation, noted the company's ownership of certain life insurance
policies, and sought permission to cash in the policies and distribute the proceeds to the
parties in accordance with their interests in the corporation.37 This issue was included
among those referred to the auditor for an interim report and recommendation.38
At a proceeding conducted by the auditor on July 26, 2012, counsel reached an
agreement on the issue of the life insurance policies, summarized by the auditor as
follows:
We're back on the record. We had a discussion off the record, and the parties
[through counsel] agreed as follows: That the life insurance policies currently held by D-
E Distribution Corporation shall be liquidated and may be liquidated by Lisa Morgan;
prior to liquidation or signing any documents for that liquidation, Mr. George Hadley,the
accountant for D-E Distribution Corporation, shall provide to counsel the reasons and
methods he utilized to determine the appropriate values in the corporation of the Marital
Trust under the Will of Robert M. Mumma,the Estate of Barbara McKimmie Mumma to
Robert Mumma, II; to Linda Mumma;to Barbara Mumma,and to Lisa Morgan.
Once that is provided to counsel, counsel agrees that so long as the information
has been received and equates to the value given in the petition of paragraph 24,that Lisa
Morgan, in her capacity as president of D-E Distribution Corporation, may then terminate
the policies,receive the proceeds from the policies and distribute to the Marital Trust; the
Estate of Barbara McKimmie Mumma; Robert Mumma, II; Linda Mumma; Barbara
Mumma, and herself, Lisa Morgan, in accordance with the percentages as provided and
supported by Mr. Hadley.
. . . I can ask Judge Oler to make that an Order.39
The resultant court order provided, in pertinent part, as follows:
AND NOW, this 30th day of July, 2012, upon recommendation of the Auditor in
this case it is hereby ordered that Lisa Morgan, in her capacity as President of D. E.
Distribution Corporation, cancel, redeem or terminate the life insurance policies owned
by D.E. Distribution Corporation, receive the proceeds of the same and hold the proceeds
for distribution to all shareholders of D.E. Distribution Corporation according to their
respective interest in said corporation. Further that within ten days of this Order, D.E.
Distribution Corporation and the residuary trust established by the Last Will and
37 Petition To Authorize Plan of Liquidation, filed Apri15,2012.
38 Order of Court,April 16, 2012.
39 N.T. 66-67, Auditor's Hearing,July 26,2012.
12
Testament of Robert M. Mumma through their accountants shall provide all counsel with
the method and the documents supporting the same for ascertaining the proportional
shares each shareholder/party holds in the corporation. Upon receipt of the information
each party shall have five (5) days to object and if no objection is made. Lisa Morgan, as
president of D.E. Distribution, shall distribute the net proceeds received from the
terminated policies to all shareholders in accordance with his, her or its proportional
interest.ao
Six months later, having dispensed with the services of the attorney who had
represented him at the auditor's proceeding, appellant filed a pro se "Petition To Compel
Compliance with Court's Order Dated July 30, 2012 and for Sanctions and Alternatively,
To Vacate Said Order."41 The petition claimed that appellant had never authorized the
agreement concerning the insurance policies, that his then-attorney had not received the
July 30, 2012, order (notwithstanding the attorney's inclusion on its distribution list), and
that the insurance policies in question had not in fact been the property of D.E.
Distribution Corporation.42 The petition did not allege, however, that he had not
negotiated the $210,450.24 check he received from D.E. Distribution pursuant to the
policy surrender transaction.a3
In response to this petition, the court issued a Rule To Show Cause on February
22, 2013, and, as a result of an answer by Ms. Morgan,44 an order pursuant to
Pennsylvania Rule of Civil Procedure 206.7 was entered, (a) enabling appellant to make a
record by way of depositions to support the petition and counter the denials of the answer
and (b) scheduling oral argument for May 31, 2013.4s
ao Order of Court,July 30,2012.
al petition To Compel Compliance with Court's Order Dated July 30, 2012 and for Sanctions and
Alternatively,To Vacate Said Order, filed January 28,2013.
az Id
as Id
44 Response of Lisa M. Morgan As Executrix and Trustee of the Estate of Robert M. Mumma To Petition
To Compel Compliance with Court's Order Dated July 30, 2012, and for Sanctions and Alternatively, To
Vacate Said Order,filed March 15,2013.
45 Order of Court,April 5,2013.
13
No depositions were taken by the appellant.46 Following oral argument at which
his current counsel of record represented the appellant, a motion was filed to supplement
the record or reconsider an earlier order that declined to extend the deadline for
depositions.47 In view of the explicit and more-than-adequate period of time afforded
petitioner to conduct depositions in the court's order establishing a process for disposition
of the petition, the history of delay that had characterized this estate, and the fact that
briefs had been submitted and oral argument already held on the issues raised in the
petition, the court denied the motion.48 On June 5, 2013, the court issued the following
order with respect to the motion to revisit an order entered a year earlier and already
carried out in terms of a distribution of proceeds to appellant and other corporate
shareholders:
AND NOW, this Sth day of J[1NE, 2013, UPON CONSIDERATION OF THE
"Petition To Compel Compliance With Court's Order Dated July 30, 2012, and for
Sanctions and Alternatively, To Vacate Said Order," and following an argument held on
May 31, 2013,the motion is DENIED.
DISCUSSION
Statement of law. With respect to the issue of the court's failure to solicit further
argument or anticipate objections to the auditor's interim report, it is the court's view that
the local Orphans' Court rule relied upon on appeal was not intended to provide a formal
structure for disposition of every interlocutory and frequently trivial issue referred to the
auditor for a recommendation. The local rule in question provides as follows:
Rule 8.7-2. Objections to the auditor's report shall be filed with the Clerk within twenty
days after receipt of the notice of filing of said report. Objections shall be specific as to
the basis of the Objection, whether as to the findings of fact or conclusions of law, or
both a9
ab Appellant's only contribution to the evidentiary record with regard to his petition was an impermissible
attachment of an affidavit to his pro se brief for oral argument. See, e.g., Knisley v. Consolidated Rail
Corp., No. 99-3184 Civil T., slip op. at 3 n.2 (Ct. Com. Pl. Cumb.Nov. 16, 1999).
47 Petition To Supplement Record and/or for Reconsideration of Petition To Extend Discovery Deadline,
filed June 4,2013.
48 Order of Court,June 12,2013.
a9 C.C.O.C.R. 8.7-2 (emphasis added).
14
Procedural rules aze to be interpreted in a practical way to effect their purposes
and secure just, speedy and inexpensive detertninations of actions.50 While the local rule
in question cleazly applies to the fmal auditor's report, in the context of which the
disposition of numerous interlocutory issues can ultunately be reviewed, the practice by
the court in this estate has not been to regard the auditor's guidance on each intermediate
matter refened to him as the funcrional equivalent of a fmal report; such a construction of
the rule would have provided a vehicle for additional delay in an estate already
reminiscent of Jarndyce v. Jarndyce, was not expressly or implicitly required by the rule,
would not have been consistent with principles of construction applicable to procedural
rules, and was unnecessary given the extensive record created by counsel before the
auditor.
With respect to issues of subject-matter jurisdictian, it is well settled that an
Orphans' Court in which a decedent's estate is pending has jurisdiction over matters
relating to the ownership of assets by the estate and their administration. See Pope v.
Dascher, 429 Pa. 576, 240 A.2d 518 (1968); 20 Pa. C.S §711.
Finally, with respect to the disposition of a petition under Pennsylvania Rule of
Civil Procedure 206.7, the burden is upon a petitioner to ma.ke an evidentiary record that
supports the petition in the face of an answer refuting the allegations of the petition.
Based upon these principles, and for the other reasons indicated in this opinion, it
is believed that the two interim orders da.ted May 6, 2013, and the interim order dated
June 5, 2013, now on appeal, were properly entered.
BY THE COURT,
G'(/ � � /`.
Wesley Ole ., S.J. `
so See, e.g., Pa. R.C.P. 126 (liberal construction of rules of civil procedure "to secure the just, speedy and
inexpensive determination of every action or proceeding to which they are applicable").
15
Joseph D. Buckley, Esq.
1237 Holly Pike
Carlisle, PA 17013
Auditor
Robert B. Eyre, Esq.
27 East Front Street
Media, PA 19063
Attorney for Robert M. Mumma, II
Ivo V. Otto, IV, Esq.
George B. Faller, Esq.
Jennifer L. Spears, Esq.
10 East High Street
Carlisle, PA 17013
Attorneys for Lisa M. Morgan
Brady L. Green, Esq.
Suite 3100
1818 Market Street
Philadelphia, PA 19103
Attorney for Lisa M. Morgan
Richard F. Rinaldo, Esq.
16th Floor
One Gateway Center
Pittsburgh, PA 15222
Attorney for Barbara M. Mumma
Linda Mann Mumma
P.O. Box 30436
Bethesda, MD 20824
Pro Se
16
APPENDIX
IN RE: ESTATE OF ROBERT M. : IN THE COURT OF COMMON PLEAS OF
MUMMA, deceased : CUMBERLAND COUNTY, PENNSYLVAT,TIA
: ORPHANS' COURT DIVISION
: N0. 21-8b-398
AUDITOR'S INTERIM REPORT, APRIL 24, 2013 AND REQUEST FOR ORDER
To The Honorable J. Wesley Oler, Jr.:
Your Honor has appointed me Auditor in the above captioned matter and charged me
with reviewing the most recent and final account and proposed distribution in the above matter
and holding a hearing on the most recent accounting and proposed distribution. I had held more
than thirty-five (35) days of hearings on the objected accounts of this Estate and Trusts created
thereunder. The parties had stated following the final hearings that they were attempting to hold
meetings and discuss possible resolution of some or all of their respective issues. In the interim
certain Petitions were filed which your Honor has referred to me for an interim report. The
following report was prepared by me and ready in November 2012, but I had filed a request for
interim payment prior to issuing the report. Your Honor entered a recent Order directing
payment of my costs and fees and a check was delivered to my office on April 4, 2013.
Unfortunately I was out of the country and have recently returned and file this report as written
in November 2012. � :-: -�;�
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1
The Trustee, Lisa Morgan has filed a two Petitions, the first seeks permission from the
court to hire a real estate expert and begin to liquidate the tnist's assets including certain real
estate assets which the tnist has a substantial interest and to terminate or cash-in certain life
insurance policies owned by one of the corporations, D. E. Distribution Corporation. One of the
reasons stated for the request was to inject the trust with funds to insure on�oing expenses can be
paid. The second Petition relates to the proposed sale of real estate.
Your humble servant conducted a series of many telephone conferences with the
parties' counsel. Ms. Linda Mumma, one of the four children of Robert M. Mumma and a
beneficiary of the trust had written to this office, but I did not personally review the contents of
the letter. I directed my assistant return the letter to the address from which it was sent and
requested Ms. Mumma provide our office with a current address and phone number and further
advised her that if she proposed to file an answer to the Petitions of the trustee, she should file
the same with the Clerk of the Orphan's Court. Ms. Mumma was advised by mail of the first
telephone conference and invited to participate; however, she did not contact this office with a
telephone number or a current address. The letters from this office including the Notice of
Hearing on the current petitions were sent to Ms. Mumma at the address on the envelope of her
initial letter and none were returned to my office by the United States Postal Service.
Following our conferences and in the weeks separating each conference, the parties
exchanged information and advised that they anticipated stipulating to the facts and only desired
legal argument on the issues. The main issues were the authority vested in the trustee to sell
certain real estate and the affect of the MRA I and MRA II agreements on the authority of the
trustee and the interpretation of the Will's residuary disposition provision and the powers, duty
and authority of the surviving trustee. I therefore scheduled argument for July 26, 2012 at 1:00
2
PM and sent notices to all the parties and beneficiaries or their counsel of record. Cotulsel
provided a stipulation of facts to my office two days prior to the argurnent hearin�.
The argument hearing was held at 1:00 PM July 26, 2012 in the Coui-troom of.the Old
Courthouse as noticed. During the hearing the parties agreed that the life insurance policies
currentl; owned h� n F. ni�trihi�tinn C'nrnnratinn sx��uld be teaminated,�roceeds ca�hec3 an�i
distributed and therefore, I requested an Order permitting the same. Your Honor entered an
Order directing that "Lisa Morgan, in her capacity as President of D. E. Distribution Corporation,
cancel, redeem or terminate the life insurance policies owned by D. E. Distribution Corporation,
receive the proceeds of the same and hold the proceeds for distribution to all shareholders of D.
E. Distribution Corporation according to their respective interest in said corporation. Further that
within ten days of this Order, D. E. Distribution Corporation and the residuary trust established
by the Last Will and Testament of Robert M. Mumma through their accountants shall provide all
counsel with the method and the documents supporting the same for ascertaining the
proportional shares each shareholder/party holds in the corporation. Upon receipt of the
information each party shall have five (5) days to object and if no objection is made, Lisa
Morgan, as president of D. E. Distribution Corporation, shall distribute the net proceeds received
from the terminated policies to all shareholders in accordance with his, her or its proportional
interest."
The undersigned had waited to be noticed as to whether the cancelation and redemption
of the life polices had occurred and if it had occurred the amount of funds received, and if
redeemed that funds had been received, if the amount of funds received was sufficient to assure
continued administration of the Trust. The parties had stated the cash values of the policies were
approximately two million dollars.
3
During a recent conference call the undersigned was advised by the trustee's counsel that
he had not received the cash value from the respective carriers on the life policies because Mr.
Brooks, counsel for Robert NI. Ntumma, II, had not responded to his requests relative to the
matter. Mr. Rinaldo, counsel for Barbara Vlumma, had responded to the inquiry. Mr. Brooks
stated he had not received this Honorable Court's Order. The undersigned in�uired of the Clerk
of the Orphan's Court and determined that Your Honor's Order was sent to Mr. Brook's office
via United States First Class mail many months ago and that it had not been returned to the
Clerk's office by the postal service. The undersigned had sent copies of my interim report and
proposed order by means of electronic mail to all parties or their counsel prior to presenting it the
Your Honor. Your Honor's Order directed counsel to exchange the proposed proportionate share
distribution and only if a party objected within a short time frame he or she by their inaction was
deemed to approve and the trustee could then receive the proceeds and distribute them in
accordance with the proportionate shares of interest.
Counsel for the Estate and the trusts created thereunder did not report that the trusts were
in any immediate need of funding beyond the funds it believed would be received from the cash
value of the life policies.
The undersigned will address the remaining two issues relating to the proposed sale of the
property referred to as the UPS property and also to the trustee's, Lisa Morgan's, request to hire
certain experts and begin a plan of liquidation and distribution of the assets of the Estate and the
trusts thereunder, to the residuary beneficiaries.
4
THE PROPOSED SALE OF PROPERTY- UPS DRIVE �1ND REQUEST TO BEGIN PLAN
OF LIOUIDATION OF TRUST ASSETS
The parties entered into the following stipulation of facts:
1 Lisa M Mor��n is the s�l Tn�s PP nf thP Marital TniS � "Marital Tt-�st") and the
Residuary Trust (the "Residuary Trust") under Mr. Mumma's will. The Will of Robert M.
Mumrna is attached hereto as Exhibit"A".
2. Respondents Robert M. Mumma II ("RMM II"), Barbara M. Mumma ("Babs
Mumma"), and Linda Mumma ("Linda Mumma") are, along with Mrs. Morgan, remaindermen
of the Marital Trust and the Residuary Trust.
3. Robert M. Mumma died on April 12, 1986.
4. Barbara McK. Mumma, widow of Robert M. Mumma, died on July 17, 2010.
5. RMM II and Babs Mumma filed Objections to all of the accounts filed by Mrs.
Mumma and Mrs. Morgan.
6. Attached as Exhibit"B" is a Summary of Appraisals, identifying the various parcels
of real property in which the Trusts claim interest, either directly or through ownership by the
Trusts of interest in various entities, stating appraised values of such real estate as of July 17,
2010, as submitted by an appraiser retained by Lisa Morgan.
7. The Agreement Among Tenants-in-Common known as "MRA-I" lists the following
ownership interest:
Estate of Robert M. Mumma 81.82507%
RMM II 4.24708%
Linda Mumma 4.23555%
Babs Mumma 4.23555%
Lisa M. Morgan 4.23555%
Barbara McK. Mumma 1.22120%
5
The MRA-I Agreement is attached hereto as EYhibit"C."
8. The Agreement Among-Tenants-in-Common known as "N1RA-II" lists the
follo�ving ownership interest:
Estate of Robert M. Mumma 98.08612%
RMM II 0.47847%
Linda Mumma 0.47847%
Babs Mumma 0.47847%
Lisa M. Morgan 0.47847%
Barbara McK. Mumma 0.47847%
The MRA-II Agreement is attached hereto as Exhibit"D".
9. Mrs. Morgan, in her representative capacity as Executrix of the Estate of Barbara
McK. Mumma, is the sole shareholder, director and officer of Mumma Realty Associates, Inc.,
(MRA, Inc."), the manager of the assets governed by both the MRA-I Agreement and the MRA-
II Agreement.
10. Real estate Mrs. Morgan believes is governed by the MRA-I Agreement appears on
Exhibit"B" as items 10, 1 l, 12, 13, 15, 16, 17, 18, 19, 20, 21, 22 and 23.
11. Real estate Mrs. Morgan believes is governed by the MRA-II Agreement appears
on Exhibit"B" as item numbers 9 and 14.
12. Mrs. Morgan also believes that the Residuary Trust owns two parcels of real estate,
set forth as item numbers 24 and 25 on Exhibit "B," and a parcel of real estate in Leadville,
Colorado having an appraised value as of$670,000.00, as stated in an appraisal submitted by an
appraiser retained by Lisa Morgan.
13. Mrs. Morgan also believes that the Marital Trust claims ownership of real estate
known as Pennsboro Center in Cumberland County, Pennsylvania. This real estate is set forth as
item number 2 on Exhibit "B".
6
14. D-E's assets consist of at lzast three parcels of real estate, accounts receivable from
various affiliated entities, some tangible personal property in the form of fully depreciated
equiprnent of minimal value and certain life insurar�ce policies having cash values collectively of
approximately $2,033,064.00. Real estate owned by D-E is set forth on Exhibit "B" as items 5, 6
and 7.
15. GAT's assets consist of at least one parcel of real estate and an escrow account
held for the benefit of RMM II as a result of a certain lawsuit by RMM II asserting dissenters'
rights with respect to the sale of certain of GAT's assets.
16. Real Estate owned by GAT is set forth as item number 8 on Exhibit"B".
17. Mrs. Morgan has advised RMM II, Babs Mumma and Linda Mumma that she
"does not intend", as Trustee, to sell or otherwise dispose of real estate, stock or other non-cash
assets in the Trusts, the Mumma Realty Associates tenancies, D-E Distribution Corp. or G-A-T
Distribution Corp. without seeking and obtaining prior approval of the Orphans' Court. Mrs.
Morgan will continue to make expenditures for costs and expenses incurred by the Trusts of the
corporate entities, including, without limitation, operating expenses professional fees and taxes."
18. Mrs. Morgan desire to sell two parcels of real estate pursuant to a proposed sales
agreement, which document is attached hereto at Exhibit"E".
19. The Real Estate is contiguous to a parcel of approximately 61 acres of real estate
owned by Bobali Corporation ("Bobali Property") the appraised value of which parcel, according
to the appraisal performed by the appraiser retained by Lisa Morgan, was $2,300,000. as of July
17, 2010.
20. Gibson Boulevard, in the vicinity of UPS Drive and the Bobali Property, is a
divided roadway.
7
21. The remaindermen identified in paragraph 2 hereof are among the shareholders of
Bobali Corporation.
The Undersigned sets forth the followin� facts relating to the matters raised by the Trustee as
determined from previous hearings and the record of this case as follows:
1. Robert M. Mumma's Last Will and Testament dated May 19, 1932 and his First Codicil
to Last Will and Testament dated October 12, 1984 were duly probated with the Register
of Wills in and for the County of Cumberland. (Copies previously attached)
2. Mr. Mumma's wife, Barbara McK. Mumma and his daughter, Lisa Morgan were named
and appointed as Co-Executrices and also as Co-Trustees of both trusts established in the
Last Will and Testament.
3. The Seventh and Eighth sections of Mr. Mumma's Last Will and Testament establish
trusts for the lifetime benefit of his wife, Barabara Mck.Mumma.
4. The final paragraph of the Seventh section of Mr. Mumma's Last Will and Testament
states: "Upon the death of my said wife, the principal of this Trust, as it is then
constituted, shall be paid over by my surviving Trustee unto my children, ROBERT M.
MUMMA, II, BARBARA M. McCLURE [ now Mumma], LINDA M. ROTH [now
Mumma] and LISA M. MUMMA [now Morgan], free of this trust, share and share alike,
per stripes and not per capita."
5. The second paragraph of the Eighth section of Mr. Murnma's Last Will and Testament
states: "Upon the death of my said wife, the principal of this trust, as it is then
constituted, or, if my said wife does not survive me, upon my death, my residuary estate,
shall be paid over by or my surviving trustee or by my successor Executor, as the case
8
may be, unto my children, ROBERT 1�1. 1�1UMMA, II, BARBARA M. McCLURE ( now
l�Iumma], LINDA M. ROTH [now Mumma] and LISA M. 1�1UM�IA [now NlorQan]„
free of this trust, share and share alike, per stripes and not per capita."
6. The last paragraph of the Eighth section of NIr. Mumrna's Last Will and Testament
states: "The Trustees shall be vested �vith reasonable discretionary no�vers in all matters
not otherwise herein specifically provided, they shall exercise their sound judgment and
discretion in the performance of their duties. They shall not be liable for any error of
judgment provided that such error is honestly made."
7. The Ninth section of Mr. Mumma's Last Will and Testament details the broad powers
granted to the trustees and provides, in part : "as in their discretion they deem advisable,
in addition to and not in limitation of their common law and statutory powers:
(1) To allot, assign, ... convey,...mortgage, ...sell ... and in general do any and every
act and thing and to enter into and carry out any and every agreement with respect
to the property included in any trust created under this Will which they could if
they were the absolute owners thereof, without being limited in a.ny way by the
specific grants of power hereinafter made.
(2) ...retain .. all or any part of my property or assets which constitute a part of the
trusts... .
(3) To sell or exchange, either privately or at public sale and without prior approval
of any court at such time or times and at such prices and on such terms and
conditions as the trustees may consider advisable all or any part of the trust
property ... .
9
(4) To manage any real property held by them in such maruier as they may determine,
including authority to alter, repair, maintain or improve, ... to erect or demolish
buildin�s thereon, ... and to charge the cost of any action taken with regard to any
such property to the principal or income as they may determine.
(51 To lease an� real estate sub�ect to the Trust .._ as ma� be in the di�cretion �f the
trustees in the best interest of the trust estate.
(6) To invest ... or acquire ... real or personal property ... as they may deem
advisable, ... it being my intention to give my trustees power to act in such
manner as they believe to be in the best interest of the Trusts created herein.
(7) To pay income tax on gains from the sale ... .
(8) To amortize, ... mortgage ... against any real estate [and] ... the trustees shall
specifically keep and perform all of the covenants, terms and conditions of any
existing mortgage or mortgages upon said real estate ... .
(9) To ... exercise all rights and privileges pertaining to securities which are available
(10) To receive or make distribution of any trust herein, either in money or in-
kind ... The judgment of the trustees as to what constitutes an equitable
distribution or apportionment shall be binding and conclusive on the beneficiary
hereof. Nothing herein contained, however, shall empower the trustees to make
distribution before the time or times specified herein
(11) To pay ... any claim ... .
(12) To use income ... to maintain any policies of life insurance ... if the
trustees determine that the best interest of my family would be served ... .
10
(13) To employ counsel, ... accountants, ... appraisers ... and others and ... to
pay their compensation ... .
(1�) To boi�ro�v money ... .
(15) To incorporate ... .
(161 To carry on and conduct any business enter�rise in which I ma� bz
engaged at my death.
(17) To hold ... consolidated funds ... as they may determine.
(18) As to each Trust created herein, to eYercise all the powers granted and all
duties imposed herein until such time after the termination of that Trust as the
property included in that Trust has been fully distributed and to do all other acts
which in their judgment, may be necessary or appropriate for the proper or
advantageous management, investment or disposition of any property included in
any Trust created herein."
8. The Estate of Robert M. Mumma and/or the trusts created thereunder has a majority
ownership interest various parcels of real estate pursuant to two agreements commonly
referred to as MRA I and MRA II and the real estate subject to the agreements are
collectively called the Premises and a list of the parcels subject to the respective
agreement are attached as an Annex to each agreement.
9. The MRA I agreement paragraph 1(b) provides that the manager, (Mumma Realty
Associates, Inc.), has certain duties, rights and authority, for and on behalf of the Owners
and include : to advertise space for rent, to rent space, to collect rent, to institute legal
action for delinquent rent, to make repairs, to contract for utilities, to perform services
11
for care, protection and maintenance, to hire, supervise and discharge employees, prepare
and file forms. establish and maintain files, review bills and insurance policies, and to
maintain books and accounts.
10. The NIRA I agreement paragraph 1 (e) specitically states that "... [1T]o manager (or
Ownerl on behalf of the owners, wi ho �t he con�en �f the nwner�, �hall have na v rioht
or authority implied or apparent : (i) to sell or encumber the Premises or any part thereof
or any interest of an Owner therein except as provided in Section 3 below."
1 l. The MRA I agreement paragraph 3, states, in part, in subsection (b) "Except as
hereinafter provided in this Section, no owner shall dispose of, sell, transfer, assign,
convey, mortgage,pledge, grant a security interest in, hypothecate or encumber part or all
of his or her divided interest in the Premises without the prior consent of the Owners and
any such transaction purported to be accomplished contrary to the provisions hereof shall
be absolutely void."
12. The MRA I agreement paragraph 4 states: "Action by Owners. General, overall
management of the Premises and of all matters arising out of or in connection with the
premises, including a sale or mortgage of the entire Premises or a part thereof, shall be
vested in the Owners jointly and each owner shall abide by the policies and decisions
with respect thereof. Any agreement, approval, decision, consent, request or other action
of the Owners shall be by a majority (in interest) vote and in writing unless otherwise
indicated."
13. The MRA I agreement also provides that any owner has the option to have any dispute
resolved before a single arbitrator and all parties to this matter do not desire binding
arbitration on this matter.
12
14. One property owned and mana;ed contains two contiguous parcels of vacant land
totaling appro:�imately 2.17 acres located on UPS Drive in Dauphin Countv and having
been designated as parcel number 63-02�-10? ("liPS property") was appraised in 2010 at
$20�,000.
1�. Another property in which the parties to this matter have an ownershi� interest, through
their respective interest in the Bobali Corporation, is a parcel of vacant land of
approximately 61 acres property and contiguous to the UPS property and having
boundaries on both UPS Drive and Gibson Boulevard in Dauphin County ("Gibson
property') was appraised in 2010 at $2,300,000.00. (A copy of an aerial photograph of
the properties together with a super imposed boundary line provided by the Dauphin
County Tax Assessment Office is attached for reference only. The UPS property is
outlined and cross hatched in red and the Gibson property in green)
16. Sometime in 201 l, Lisa Morgan notified her brother Robert and sisters Barbara Mumma �
and Linda Mumma that she would be seeking a purchaser for the UPS property.
17. Lisa Morgan had negotiated for the sale and purchase of the UPS property to United
Parcel Services, Inc. and/or its affiliate BT-Newyo, LLC for$350,000.00.
18. Lisa Morgan, as trustee of the trusts holding majority interest ownership of the UPS
property, authorized Mumma Realty Associates, Inc, the manager of the UPS property, to
enter into a purchase agreement with BT-Newyo, LLC for $350,000.00.
19. On April 11, 2012, Lisa Morgan, as President of Mumma Realty Associates, Inc. signed
an agreement for the sale and purchase of the UPS property for the offered $350,000.00
contingent on this Honorable Court's approval.
13
20. On Mav 21, 2012, Lisa I�1orQan notified her siblings, Robert NI. Nlumma, II, Barbara
Mumma, and Linda Nlumma that she had authorized an agreement for the sale and
purchase of the UPS property and the terms of the sale. She requested their concurrence
and stated that if they did not concur she�vould seek approval from the Court.
21. Lisa Morgan desires to sell the ITPS nrn�in her c�r�v as a reSi, u�y henPfi�ia�.
22. Robert M. Mumma II objects to the sale.
23. Barbara Mumma objects to the sale.
24. Linda Mumma was contacted but she has not communicated whether she consents or
objects to the sale, either verbally or in writing.
25. Lisa Morgan, as trustee, desires to begin a plan of liquidation and distribution of the
remaining assets of the Estate of Robert M. Mumma and the trusts established
thereunder, including the real estate subject to the MRA I and MRA II agreements.
26. Lisa Morgan individually consents to her proposed liquidation and sale of the assets.
27. Robert M. Mumma II objects to the sale of real estate assets or other assets.
28. Barbara Mumma objects to the sale of real estate assets or other assets.
29. Linda Mumma was contacted but she has not communicated whether she consents or
objects to any additional sale or liquidation of assets.
30. Robert M. Mumma believes that the remaining assets of the Estate and the trust must be
individually separated and that each separated, individual asset must then be transferred
to himself and his three siblings as either tenants in common or joint tenants with the
right of survivorship.
14
ARGUNIENT OF THE PARTIES
A. Lisa Morgan
Lisa 1�Iorgan, as the sole survi�ing trustee, ar.gue� that Section �3�i relating tn the
powers of the personal representative and the PEF Code Section 3354 relating to testamentary
powers to sell real property, supports her position. She also argues that the Ninth Section,
paragraph 3 of the Last Will and Testament of Robert M. Mumma grants her the authority as
surviving trustee, to sell or exchange, either privately or at public sale and without prior approval
of any court any part of the trust property, real, personal or mixed and to execute all deeds, bills
and other documents necessary to effectuate the same.
She further argues that her siblings, Robert Mumma and Barbara Mumma have no right
to insert themselves into her decision making process regarding the disposition of the trust assets
as she bears the burden of a fiduciary subject only to possible audit after the fact. She asserts she
is not required to seek the Court's permission but is currently requesting clarification based on
her previous promises to this Court and the "uniquely contentious environment that surrounds"
this matter.
In support of her position, Lisa Morgan further argues that the Pennsylvania Superior
Court's recent decision involving her administration of this estate rejected the argurnent by
Robert M. Mumma, II that she as trustee was required at the death of her mother to make an
immediate, equal, in-kind, distribution of the trust assets to the residual beneficiaries. She argues .
that this rejection was an affirmation of her authority to make independent decisions relating to
the liquidation and equal distribution of the trust's assets.
15
Lisa Nlor�an, as the sole Trustee, argues that she has the authority, as trustee, to sell the
UPS property and to sell all the other properties subject to the MRA I and the VIRA II
agreements without the advice or consent of the owners of minority interests. She bases this on
the fact that the Estate is the Owner of inore than more than eighty (80%) percent of the Premises
and because of the sl et}��oritv need� no a}�}1ro�aLfra�.the ather (Lwr,Pr�, her ��„o� wh�
owns a combined total of less than thirteen (13) percent of MRA I and less than two (2) percent
of MR.A II. She further argues that this Honorable Court by the Orders and Opinions of the
Honorable Harold E. Sheely dated March 24, 1992 and November 5, 1992 at Docket No. 66
Equity 1988, has previously determined that the trustees because of this super majority
ownership interest did not need to seek approval from the minority Owners or this Honorable
Court. .
B. Robert M. Mumma II
Robert M. Mumma, II first argues that the statements made by the Superior Court in its
recent opinion were merely dicta and that its rejection of his many raised issues creates no
precedential value. He argues the questions before the Superior Court was whether Lisa Morgan,
as Executrix and Trustee of his father's estate and also as Executor of his mother's estate created
a conflict of interest and whether Lisa Morgan had breached her fiduciary duty. The issue
presented before this Honorable Court and before the undersigned relates to a very specific issue
relating to Lisa Morgan's authority to sell estate assets and the interplay between the specific
provisions of the Last Will and Testament of Robert M. Mumma and the PEF Code.
Robert M. Mumma II next argues that his father's Last Will and Testament granted
specifically defined powers and Pennsylvania Courts and the PEF Code support his position that
16
Lisa MorQan po�ver as trustee terminated at the death of Barbara NIcK. Mumma, her Co-trustee.
He cites the PEF Code's provision relating to events which terminate or partially terminate a
trust and their effect or.the continuing power and duties of a trustee. ?0 Pa. C.S. Section 7780.7:
Robert NI. Mumma, II further argues that the Pennsylvania Courts have determined the
polestar in every trust is the �ettior's intent and in everv will the te�tat�r's intent, i� the
controlling factor. (cites omitted) He asserts the clear intent of his father was that immediately
upon the death of his wife, Barbara McK. Mumma, the trust's assets were to be distributed
equally to his four children. Under the governing terms of his father's Will he argues Lisa
Morgan is not the sole trustee of any trust as both trusts have terminated by the occunence of the
death of his mother. He claims the original purpose of the trust was to benefit his mother during
her lifetime and at her death the purpose ceased and the trust terminated. He argues that Lisa
Morgan has no standing or authority to act in any role as a putative trustee.
Robert M. Mumma II agrees arguendo that MRA I is the owner of the UPS property and
he absolutely agrees that Bobali Corporation is the owner of the Gibson property. He argues that
the UPS property should not be sold because it provides additional access to the Gibson property
and that Lisa Morgan did not fully evaluate the effect the sale of the UPS property may have on
the Gibson property. He presented no facts and cited no legal authority for his argument.
Robert M. Mumma II also acknowledges the differing ownership interests but argues,
Lisa Morgan's reliance on her ability to control the Estate's ownership percentage, and the
voting power associated with it, is misplaced and that she is only entitled to vote the share she
owns in her individual capacity. He cites no legal authority for his argument and does not
attempt to distinguish Judge Sheeley's findings and determination in this matter at Docket No.
66 Equity 1988.
17
Robert M. Mumma, II finally argues that Lisa Mor�an should not be permitted to sell the
UPS property because she has not fully explored all options relating to the property's potential to
generate income. He cites no relevant facts to support this argument nor does he cite any legal
authority fur the argument.
C. Barbara Mumma
Barbara Mumma first argues the sale of the UPS property should not be approved
because Lisa Morgan did not provide the advance notice to her and to all the other the owners
of the UPS property in accordance with the MRA I agreement. She provides no legal authority
for this argument and does not attempt to distinguish Judge Sheeley's findings and determination
in this matter at Docket No. 66 Equity 1988.
Barbara Mumma's next argues that because Lisa Morgan failed to make distribution to
the trust's assets to the Estate's residuary beneficiaries following the death of her mother, as
directed in her father's will, she has violated her duties of impartiality. She cites the PEF Code as
her authority: "If a trust has two or more beneficiaries, the trustee shall act impartially in
investing, managing and distributing the trust property, giving due regard to the beneficiaries'
respective interests in light of the purpose of the trust. (20 Pa. C. S. Section 7773)." Barbara
Mumma asserts that had Lisa Morgan followed her duties as set forth in the Will and the PEF
Code and distributed the Estate's proportional share of the MRA I assets equally among and
between the residuary beneficiaries, the Estate's ownership interest would have been reduced to
zero and each of the four beneficiaries' respective share of ownership would have been increased
by 20.456267%. This would result in Lisa Morgan in her capacity as trustee and individual not
18
havin� authority and control of a majority interest. She argues this failure to distribute is a ploy
to maintain majority control and not grant first rights of refusal to the other owners. Barbara
Nlumma cites the Restcrtement (Third) �f Trirs•ts, Section 79 {�007) as authority for this position
but offers no Pennsylvania legal authority accepting t11at section or any other legal authority
supporting this argument.
Barbara Mumma next argues that Lisa Morgan did not consider other options with
respect to the UPS property that would be less detrimental to the Gibson property. She offers no
factual or legal authority for this argument.
Barbara Mumma also argues that Lisa Morgan has no right or authority to sell any other
property and should transfer the assets equally share and share alike to the four residuary
beneficiaries. She stated she adopted Robert M. Mumma's arguments in support of her position,
but provided no additional legal authority in support of the same.
AUDITOR'S RECOMMENDATION AND REASONING
The parties have agreed to the facts of this matter through a stip�.ilation and also other
tacts suppltmented during their oral argument and fa�ts of record. After reviewiug not only their
ar�uments and their authorities, the a�t•eements, the Last Will and Testam�nt of Robert M.
�![ulnina and its Fist Codicil; the decisions of this Honorable Court, the P�:nnsy-lvania Superior
Court and the Pennsylvania Supreme Court, I would recommend that the sale of the UPS
property sh�uld be approved. I would further recommend that Lisa Morban, in her capacity as
survivin� tnistee, has the authority over all the assets of the estate of her father and the trusts
created thereunder, including the authority to develop and the discretion to iinplement a plan of
19
liq�.�iciati�n t�f thc�se ass�ts; anc� fo11c��i�� tl�at, tc� c�istribute the r�sulting �ssets in ec�ual shartis
�vithc��at t�e cc�nc�irrenc;� of t�ze resic�u�r�-- benef�czaries ��nd ��ith�ut fir��t�ler or�ier v� this
IIo�lc�rab�� Court.
he 7V aree��s;ntfi
As t�etermined by this HoYic�rat�ie Court ma1�y �rear5 a�o, t11� i��RA I and NTRA II
a�=rcements were simply iegal�ehicies dev�lo��d, approved and e�ecuted by the Estate af Robert
iVI. Miunma, his tivife and his foiir children, after consultation with accounta�lts and tax attorntys,
to take adianta�e o�`certaiti benefits (i.e. The C,eneral Utilities Doctrine) of the then fec�era3 tax
code which �vere set to expire on December �l, l 986. (Tax Reform Act of 19$6, �ffect January
1, 1987, citatiazi omitted) (See Jud�� Sheeiy's CJpinic�ns anc3 Or�ers aC Docket b6 Equity 1988;
su�ara.) These veliiclea provided a great taY bencfit to the estate and uitimately to t1�e
beneficiaries. Th�se a�reements specifically segre�ater� a.nd separated certain Estate assets which
wer� not p�t of R.abert NI. Mumm��'s date of deafili quarryin� operatioY�s. Their additiolial
purpose was to iiYSUre the Estate's power to control those assets without interferei�ce from
minority owners which were then Mrs. Mumma and her fcrur cl�ildren. These ag��eements were
drafted aaxd e�ecuted prior to any fundin� af the trusts established ��nder Mr. Mum��a's Last w'ill
and Testa�nent. As ;Tudge Sheely deterinined the rninority r���rners �lot anly �xecuted fhe
agreements but also execLZted irrevocable po���ers of attorney and other dc�cuments ixx favar of the
Estate. Judge Sheely did deteY-�nine that fihe a;reements ax�d/or the ass�ts re�resent�d by the
abreements «�ere duly trai�sfert•ed to tlle ti�.rstees. Judge Sheely also determined thai durina their
administratior� of the Estates axld the tr•usts created thereunder, the trustees; Barbara McK.
20
��umma. the �vi�loyti of �Ir. 141umina, anc� Lisa i�-Ior�an held a super majority oti��i�ership, thus
cc�ntrc�llin� interest. This controllin�T interest conf�rred up�n them as trustees near absolute po�ver
ove.r the assets. TIZe trustees could treat them as tlleii own anti, irr�spective of the notice
requirements of'the agreements, thev-, acting as tl�e tri�stees, w-ere not rec�uired tu seek ar abtain
the rior '� � -
�Iumma, Linda Mumma or Lisa Morgan, the children of Mr. i�•lumtna. In the matter of the sale
of the UPS property and the matt�r of future dispositions of propei�ty, the dispusitive otivnership
interest of the trusts in the assets included in the NIRA I and MRA II Agreements has not
changed. Furthel�nore, tht reasoning for the agreements has not changed therefore, there is no
i�eed to seek nor receive approval from any one or any combination the minority oumers.
Ii�tTERI'RETATIO�T OF THE LAST WILL AND TESTAMENT OF ROBERT M. IVIUMMA
AND THE TRUSTS CREAT�D THEREUND�R
The Pennsylvania Superior in iis opinion tiled February 22, 201? (see Mumma v. Estate
of Mumma, 40 A.3d 198, 2011 (Pa. Super. Ct., 2011)), rejected Robert M. Mi,unina, II's
arg�unent that Lisa Morgan had the duty to distribu.te the trusts' assets to him and his siblings
immediately following the death of th.eir mother, Barb�•a McK. Nlumma. The Court also
determined her failure to distribute irrimediately neither evidenced a conflict of interest nor
grounds for her removal as trt�stze �r personal representative. Robert M. Mumrria, II had
petitioned this Honorable Court requesting Lisa Morgan be removed as trustee and executrice of
his father's Estate based an alleged conflict af interest. This Honorable Court determined he had
not provided sufficient evidence to support his claims and denied his petition. The Superior
Court addressed fhe issue raised by Robert M. Mumma II relating to Lisa Nlorban's powers and
21
duti�s as trustee. `` �ti'hile listed as six distinct issuts. 1�1tur�ma II essentially �resetats a sin�le
issue for our cc�nsic�eration, namely �vhether 1�I��rgan's roles in connectian �vith the estates of
�'Iuinina, S.r. and N1rs. ��umma cons±itt�te a conflict of intertst re�uirin� her disqualification and
r�mozal." Ic�. at 49. In addition t� his contention that Lisa Mor�an haci f�iiled to m�ike required
distributions to him and l�is siblings ft�llotivin�� h d � h �f hi� m�� h r R�hert 1�1 1�'I��mm�� TT
alsu suggested that Lisa Morgan and the late Mrs. Vlumma had impr�perly transferred assets
from tlz� Trusts establishe�l under his father's will to a separate independent trust in F'lorida
controlled by his another. The Superior Court affirmed this Honorable Court's findin� oF
insufficient evidence to support any allegation of tivrongdoing on the part of Lisa Mumma and
continued:
"�'ith respect to the distribution of assets to the four sibling beneficiaries, the trial court
detennined that Mor�7an's testimony establisl�ed she is completing the process of obtaining
valuations of the estate and ti�ust assets and has asked the beneticiaries if they have a preference
rebarding the receipt of any p�rlicular assets or cash a.nd that she intends to make au equitable
distribution of the assets to the beneficaaries aft�r collectin� the information. We agree with the
trial court that this approach does not constitute any breach of fiduciary duty. Mumma, Sr.
specifically provided Morgan, in her role as his personal representative when making an
equal distribution among the four sibling beneficiaries, with the power to decide how to
"make distribution of any trust herein created, either in money or in kind, or partly in
money and partly in kind." Item Ninth (10), quoted supra. Mumma, Sr. further indicated that
the "judgment of the trustees as to what shall constitute an equitable distribution or
apportion.ment shall be binding and conclusive upon the beneficiaries hereof."" Id. at 50.
(emphasis added)
Robert M. Mumma II argues that the issue before the Superior Court differs from the
issue involved in the matter before this Honorable Court and thus the statements relating to the
duty to distribute or not to distribute trust assets is clicta.
Robert M. Mumma, II was the party who raised this specific issue in his appeal to the
Superior Court. It is ironic that he now argues the issue to which he demanded an answer should
now not be controlling.
22
Black's Lativ Dictionary defines dicta, in pertinent part, as follows:
"Expressions in court's opinion which go beyond the facts before court and
therefore are indi�i�ual vie�vs of author of opinion and not binding in
subsequent cases."
Black's Lcctiv DictionaYy, 408 (Sth ed. 1979).
The portion of the opinion relating to Lisa Morgan's powers and duties under the Last Will and
Testamnet of Robert M. Mumma do not go beyond the facts and issues presented on appeal. It is
not the individual view of the Judge, but an interpretation of the Last Will and Testament based
on the current status of the law. Assuming, even for argument sake, that the statements and
reasoning of the Superior Court is dicta, which it is not,the reasoning is still persuasive.
As set forth below, Robert M. Mumma in his Last Will and Testament set forth specific
and detailed duties and direction to his trustees and granted them broad discretionary powers.
The death of Mrs. Mumma may have triggered some additional duties on the part of Lisa
Morgan, as surviving trustee, but it did not require her to immediately transfer any assets to the
four residuary beneficiaries of the Estate and the trusts created thereunder.
The death of Barbara 1�1cK. MLimma, the life beneficiary of tl�e trust, ended the primary
purpose of the trust; however, there remained the duty and responsibility to distribute the assets
equally amon; and between the residuary beneficiaries. Thus, as a result, the trust and the estate
must continue until the distributions are completed znd the estate closed. A reasonable
interpretation of the Last Will and Testament of Robert :M. Mumma, a review of applicable
Pennsylvania case lativ, togetller witli an interpretation of applicable provisioi�s of the PEF Code
lead tl�e undersigllc.C�t0 t111S COIiCIUS1Ql1.
``When interpreting the provisions of a trust, "the polestar in every trust is the
settlor's intent and that intent must prevail. The rules for determining a settlor's intent are
the same for a trust as for a will. The settlor's intent must be ascertained from a
23
consideration of(a) all the languaae containecl in the four corners of the instrument and
(b) the distribution scheme and (c) the circumstances surroundin� the testator or settlor at
the time the will was made or the trust was created and (d) "the existing facts."
Technical rules or canons of construction should bz employed onl�; if the
language of the instrument is ambi�uous or conflicting or the intent of the settlor or
testator is for an�r reason uncertain. ��hen provisions of a trust instrument conflict, "they
should be read in such a fashion as to give effect to both andior fulfill the intent of the
settlor."
In Re Stella Scheidmczntel , 2005 Pa. Super. 6; 868 A.2d 464, 488 (2005), citing In re Traist of
Hirt, 2003 Pa. Super 287, 832 A.2d 438, 448 (2003) (other cites omitted).
The Pennsylvania Supreme Court has also given direction on construction of wills and the proper
method to interpret the intent of the testator:
"The primary consideration in the construction and interpretation of wills is that the
intent of the testator be followed . . . Absent ambiguity, that intent is to be
determined from "the four corners of his will," . . . The duty of the court is not to
determine what the testator might or should have said in light of subsequent events
but, rather, the actual meaning of the words used . . . Only if the language employed
by the testator is ambiguous should the court resort to canons of construction.
(citations omitted)
Estate of Blough, 474 Pa. 177, 185, 378 A.2d 276, 280 (1977).
It is quite clear from the wording of Mr. Mumma's Last Will and Testament that the
primary purpose for the trusts was to benefit his wife, Barbara McK. Mumma, during her
'lifetime. The Seventh section reads in part : "If my wife, BARBARA McK. MUMMA, survives
me, I give and bequeath to the trustees hereinafter named, an amount equal to fifty (50%) percent
of my total gross estate ... . I direct that the trustees hold said amount, In Trust Nevertheless, to
manage, invest and reinvest the same, to collect the income and to pay over or apply the net
income to, or for, the benefit of my wife, BARBARA McK. MUMMA." The Eighth Section
provides in part: " All the rest, residue and remainder of my property and estate, I give, devise
24
and bequeath unto the trustees hereunder named ... to hold ... for the benefit of mv wife,
BARBARA McK. MUNIUTA."
Further evidence that the trust's puipose is also contained in tl�e Seventh and Ei�hth
Sections �vhich botl3 provide that upon the death of his wife, Barbara McK. Nlumma, the
principal of the trust ... shall be paid over b� his survivin� trustee or his successor EYecutor to
his children: ROBERT M. MUMMA, II, BARBARA M. McCLURE, LINDA M. ROTH and
LISA M. MUMMA, free of this trust, share and share alike, per stripes and not per capita."
The PEF Code supports the conclusion that the trust has terminated. It provides, in part :
"A trust terminates to the extent it ... expires pursuant to its terms, and no purpose of the trust
remains to be achieved. " 20 Pa.C.S. � 7740 (2012). The terms of Mr. Mumma's Last Will and
Testament clearly and specifically state when the trusts shall terminate. The Tenth Section,
paragraph 18 of the will states:
"As to each Trust created herein, to exercise all the powers granted and all the duties
imposed herein until such time after the termination of that Trust as the property
included in that Trust has been fully distributed and to do all other acts which, in their
judgment, may be necessary or appropriate for the proper or advantageous management,
investment or disposition of any property included in any Trust created herein."
The final purpose of the trust is also to insure that its assets are equally distributed to his four
children and Lisa Morgan, as Mr. Mumma's trustee, has been designated by her late father to be
the person to complete this final duty.
One thing I have gleaned through the many days of hearing over these past years is the
Late Mr. Mumma was a very sawy business man who loved his wife and children. He knew that
his business interests were many,that he had vast assets and a great amount of debt. He knew the
administration of his Estate would be a complex matter. Mr. Mumma established a very detailed
25
plan for the administration and distribution of his estate with the advice of several noted and
respected estate attornevs and accountants. He knew and understood that which he desire� and
all provisions of his ten pa�e Last Will anci Testament and his three pa�e First Codicil have
meaning to insure his wife �vas protected and provided for during her lifetime, but who he
desired to control and administer his Estate. Mr. Mumma had active business interests in
differing fields and understood that the administration of his estate would not be performed in a
vacuum.
A close reading of the first codicil provides further insight to Mr. Mumma's intent that
Lisa Morgan, as trustee, and she alone has been granted the authority to liquidate the trusts'
assets. The first paragraph names his co-Executrices: his wife and daughter, Lisa Morgan. In the
event that one or both of the named co-exeutrices are been unable to serve he appointed his
daughter Barbara McClure, now Mumma, as his substitute co-executrix.
However in the codicil continues:
"I do now nominate, constitute and appoint my wife, Barbara McK. Mumma, and my
daughter, Lisa M. Mumma, now Lisa M. Morgan, to be the co-Trustees of both trusts established
by me ... In the event that my daughter Lisa M. Morgan should renounce this office, ...
predecease me, or for any reason is unable to serve in the capacity as Trustee, then ... I direct
that my daughter Barbara M. McClure, shall be the successor co-trustee to serve as co-Trustee
with my wife ... Upon the failure for any reason of my daughter Barbara M. McClure to serve in
that capacity, the Dauphin Deposit Bank and Trust Company, of Harrisburg, Pennsylvania, is
constituted and appointed to serve as successor co-Trustee with my wife , in both trusts herein
created."
By this language Mr. Mumma intended and believed that as long as she lived, his wife
would continue to be the trustee with either one of his two daughters or the bank's trust officer.
If Lisa Morgan became incapable, Barbara McClure [now Mumma] would be her replacement.
What must be noted is that Mr. Mumma did not name a successor trustee in the event of his
26
wife's inability to act or her cieath. It evidences his intent that the remainin� trustee should act
alone.
The langua�e used in the two testamentary trust provisions further evidence Mr.
Mumma's intent that Lisa 1�lorgan is granted the authority to act alone in the method of
distribution of the assets in ec�ual shares to the beneficiarie�
w'hile the fifth paragraph of the Seventh Section provides :
"Upon the death of my said wife, the principal of this Trust, as it is then constituted, shall be paid
over by my surviving Trustee unto my children, ROBERT M. MUMMA, II, BARBARA M.
McCLURE, LINDA M. ROTH and LISA M. MUMMA, free of this trust, share and share alike,
per stripes and not per capita."
The second paragraph of the EIGHTH Section of Mr. Mumma's Last Will and Testament
provides, in part "Upon the death of my wife, the principal of this trust, ... shall be paid over by
my surviving trustee or by my successor executor, as the case may be, unto my children:
ROBERT M. MUMMA, II, BARBARA M. McCLURE, LINDA M. ROTH and LISA M.
MUMMA, free of this trust, share and share alike, ..."
Although the wording may differ between the trust provisions in the Eighth Section and
the Seventh Section, the effect is the same, Lisa Morgan, as the surviving trustee, has the
authority to liquidate and distribute those assets among and between the four named
beneficiaries. The words "upon the death of my wife" show Mr. Mumma's understanding that
his wife could pass at any time following the establishment of his estate, and she did. There are
two sets of circumstances to which the phrase which follows the words my surviving trustee or
by my successor executor, "as the case may be" refer. They are: (1) if wife dies before the trusts
are funded or (2) if wife dies after the trusts are funded. If the facts in the former case had
27
occLirred, no trusts would have been fiinded or established therefore there �vould be no surviving
tr�istees, only eYecutrices. How-ever, the facts of the latter did occur and his wife, Mrs. Mumma,
died after the funding, establishment and administration of the trusts. Therefore he intended
surviving trustee, Lisa Mor�an �vould act alone in distributina the residuary trust's assets in
equal shares to the beneficiaries.
Mr. Mumma's intent is controlling and the language used is evidence of that intent.
When a persoi�al representative is chosen by the testator himself, this appointment "represents
an e�pression of trust and conticience in the person or persons so selected" by the testator.
Beichner Estate, 432 Pa. 150, 155, 247 A.2d 779, 781 (1968).
Mr. Mumma would not have granted powers which would conflict and which would
hinder the proper administration of his estate. (cites omitted) He did not intend an absurd result.
(cites omitted). He specifically provided that the "judgment of the trustees as to what shall
constitute an equitable distribution or apportionment shall be binding and conclusive upon the
beneficiaries hereof.""Mzrmma v. Mumma Estate, supra. at 50. (Emphasis added).
The argument that Lisa Mumma is somehow violating the PEF Code's requirement that
all beneficiaries be treated equally because she is exercising the powers and duties granted to her
as trustee is wholly without merit.
28
The UPS Propertv_
Barbara Mumma has ar�ued that Lisa MorQan may not have thorou�hly investi�ated the
impact such a sale of the UPS property �vould have on the Gibson property. She also questioned
whether the Estate should resen�e a right of way on the UPS �ro�erty and how such a reauest
might affect the transaction.
The parties do have an ownership interest in the contiguous siYty-one (61) acres of the
Gibson property. Robert M. Mumma II and Barbara Mumma blindly argue and speculate as what
may or may not have an effect on the Gibson property without actual evidence of the same or
supportive legal authority. They both originally argued selling the UPS property would curtail
access to UPS Drive and as a result, limit the Gibson property's access to that offered by Gibson
Boulevard. During our first of many telephone conferences I reviewed both the aerial photos
available on Microsoft's Google Earth website and the US Geological website and requested the
parties to also review the same. By these photos it appeared that the Gibson property had access
to both Ups Drive and Gibson Boulevard irrespective of that afford by the UPS property. Lisa
Morgan's counsel later provided copy of aerial photography layered with the parcels as shown
by the Dauphin County tax mapping section (now also available on their website) and the
objectors revised their argument stating the access was several hundred feet past the access the
offered by the UPS property. They argued this added distance and the fact UPS Drive's
improved portion terminates at the Gibson property might somehow diminish the value the
Gibson property. No evidence supporting this argument was offered and no continuance
requested to produce such evidence. The basic argument was that Lisa Morgan may not have
investigated alternative uses, alternative methods of transferring the property while reserving
29
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��� ,�.
_
certain propertv ri�hts { i.e. easements or lease backs, etc) and she had not cons��lted with the
Object�rs. She did nat because she ��as not req��ired tt� do so as she had the discretic�n ta d� sa.
l�iot c�n�y does Lisa �farban have great discretion in s�ilin� the prope��ty, she negc�tiated a price
which exceeds the appraised Value by�1��,000.00.
Therefar�I recomn�e�ZCI Y��ur �-Ton�r a�roti�e the Pet�i4i� t�� sel�the��PS�'c���rt�
L,iquidation and Distribution c�f R��naii�in�Estate Assets
Lis� Mo�•ga��. has petitian�;ci �oi�r Honor tc� pernlzt her to sal�ty begin the process �f
dis#�ibution of the Estate's Assets to f:1ie residu�ry beneficiaries. Fo�•the reasoz�s detailed above I
would recoYnn�erzd, at this time, tlle petition be grante�, Under the tenns of Robert NI. Mu�nma's
Last Wi11 an�Testament Lisa Mor�;an has the clear authority�to begit� a plan of Iiquidation and to
th�reafter distribute t1�e assets a��no7�g ai�d be��veezl the four c�aildren in equal sl�ares af any and�I1
the ren3ainin� assets in th� trust�stablishec� und�r the Sev-entli Secti�ii (the rnarital trust} and the
Eigl�th Section(the residuarc tr��st) of the Lzst Will a��d Testanleiit af R.obert M. Mumma.
I furiher recammend that if yaur Honor agrees wzth rny recarnmendatians, you enter
Orders accordingly and I have attached a twa recommended orders to accomplish the sarne.
Respectfuiiy submitted,
i
�
j �`
� �
D. Buckle , quire, u itor
Supreme Court ID 38�44
1237 Hally Pike
Carlisle, PA 1'7013
(717) 249-2448
JaeBL��v�aal.cc�m
30
: ORPHANS' COURT DIVISION
. COURT OF COMMON PLEAS OF
In Re: Robert M.Muinma,Deceased . CUMBERLAND COIJNTY
. PENNSYLVANIA
. N0.21-86-0398
CERTIFICATE OF SERVICE OF ORDER
ORDER DATE: 8/30/13
NDGE'S iNITIALS: JWO .
TIME STAMP DATE: 8/30/13
IN RE: Order of Court
............................................................................................................................
SERVICE TO: Joseph D.Buckley 1237 Holly Pike Carlisle PA 17013
Ivo V.Otto III Martson Law Offices 10 East High Street Carlisle PA 17013
Bradv L. Green 1818 Market Street 31S`Floor Philadelphia PA 19103 &
Robert B.Eyre 27 East Front Street Media PA 19063
METHOD OF MAILING: ENVELOPES PROVIDED BY:
�USPS ❑PETITIONER
❑RRR � JUDGE
❑HAND DELIVERED ❑ CLERK OF ORPHANS COURT
❑ OTHER
MAILED: 8/30/13
............................................................................................................................
SERVICE TO:
Linda Mumma Roth PO Box 30436 Bethesda MD 20824
Richard F Rinaldo Williams Coulson Johnson Lloyd Parker&Tedesco One Gateway Center 16'�'FL Pittsbureh PA 15222
METHOD OF MAILING: ENVELOPES PROVIDED BY:
�USPS ❑PETITIONER
❑RRR �NDGE
❑HAND DELIVERED ❑ CLERK OF ORPHANS COURT
❑ OTHER
MAILED: 8/30/13
��.t� ��.
Deputy
Clerk of Orphans' Court