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HomeMy WebLinkAbout10-23-14 (3) IN RE: ESTATE OF IN THE COURT OF COMMON PLEAS SARAH MCCREA CHAPMAN JONES CUMBERLAND COUNTY, PENNSYLVANIA CHARITABLE REMAINDER TRUST ORPHANS' COURT DIVISION UNDER WILL DATED 9/8/76 NO. 21-2009-0329 RESPONSE OF REMAINDERMEN CHARITABLE BENEFICIARIES, BROWN UNIVERSITY, DICKINSON COLLEGE AND DICKINSON SCHOOL OF LAW OF THE PENNSYLVANIA STATE UNIVERSITY, IN OPPOSITION TO OBJECTOR HENRY L. CHAPMAN'S REQUEST TO TRANSFER VENUE AND JURISDICTION TO PHILADELPHIA COUNTY AND NOW, come Brown University, Dickinson College and Dickinson School of Law of the Pennsylvania State University(collectively, the"Charitable Beneficiaries') and hereby file the following Response in Opposition to Objector Henry L. Chapman's Request to Transfer Venue and Jurisdiction to Philadelphia County: f V rq C) C� i I C-, ' T-" Q INTRODUCTION r\, T 4 The Charitable Beneficiaries are three of the remaindermen beneficiaries' o a Cha able= C-> .a D N p Remainder Unitrust ("CRUT") established by Article Forty-First under the Last Will and o Testament of Sarah McCrea Chapman Jones dated September 8, 1976 and her First Codicil dated October 6, 1977. At the time of her death Ms. Chapman Jones was a resident of Cumberland County. At all times known to the Charitable Beneficiaries, administration of the Estate of Sarah McCrea Chapman Jones and, more importantly, administration of the CRUT, have been undertaken by and subject to the jurisdiction and venue of the Orphans' Court Division of the 1 Court of Common Pleas of Cumberland County. Henry L. Chapman, guardian of the Estate of Alfred McCrea Chapman, an incapacitated person, has filed Objections in both his individual and representative capacity to the Third and Partial Account of the CRUT filed by the corporate trustee, Manufacturers & Traders Trust Company(referred to herein as either"M&T"or "Trustee"). 1 M&T is successor to Farmers Trust Company, the corporate trustee appointed by Ms. Chapman Jones. For reasons not clearly articulated in the Objections, Mr. Chapman has asserted that venue and jurisdiction of the Third and Partial Account rests "exclusively"in the Court of Common Pleas of Philadelphia County under Orphans' Court Docket No. 1061 of 2009.2 The Charitable Beneficiaries are filing this Response in opposition to transfer of the Third and Partial Account—or any other proceeding pertaining to the CRUT- from Cumberland County to Philadelphia County. SPECIFIC RESPONSES TO OBJECTIONS 1. Denied. Mr. Chapman is simply wrong in his factually unsupported and legally unreasoned assertion that venue and jurisdiction rests "exclusively in Philadelphia County under Orphans Court Docket No. 1061 or 2009." Venue and jurisdiction on matters relating to the CRUT have heretofore existed and have been exercised properly in Cumberland County. As set forth in the Third and Partial Account (which the Charitable Beneficiaries accept as accurate for all purposes herein), the funds in the CRUT were awarded to the trustees on October 16, 1985. M&T 1 On the face of the Third and Partial Account it appears that the individual co-trustee,John McCrea,III,did not participate in its filing. 2 A copy of Mr. Chapman's Objections was provided to undersigned counsel by counsel for M&T. Despite the Certificate of Service attached to the Objections,certifying service by fax or e-mail on the undersigned by Mr. Chapman's counsel, such service was not,in fact,received. 2 previously filed a First and Partial Account in this Honorable Court on December 7, 2009, adjudicated January 12, 2010. M&T filed a Second and Partial Account again in this Honorable Court on August 17, 2011, adjudicated October 11, 2011. The history of prior CRUT proceedings in this Honorable Court is not challenged in the Objections. Mr. Chapman has attached two orders of court to his Objections, one of which is a "Decree"dated September 24, 2009 signed by the Honorable Anne Lazarus in Docket No. 1061 of 2009, Court of Common Pleas of Philadelphia County, Orphans' Court Division. The caption under the Decree in this Philadelphia docket number is "Estate of Alfred McCrea Chapman, an Incapacitated Person." The Decree directs M&T to file an account of two charitable remainder trusts in which Alfred McCrea Chapman was the lifetime beneficiary.3 Significantly, as clearly set forth in the Decree, Judge Lazarus directed M&T to file the accounts "in the Cumberland County Orphans Court" (emphasis added). Thus, Judge Lazarus, in direct contradiction of Mr. Chapman's current assertion, and in the very same docket Mr. Chapman now claims has "exclusive" jurisdiction of the CRUT, directed that the accounts be filed in Cumberland County. The Charitable Beneficiaries acknowledge that jurisdiction over the Estate of Alfred McCrea Chapman, an incapacitated person, lies in Philadelphia County. They also acknowledge that Philadelphia County has jurisdiction over a POA account wherein M&T acts as agent for Alfred McCrea Chapman. However, neither of these matters concerns administration of the CRUT for which M&T has filed a Third and Partial Account. Mr. Chapman presents no basis in fact or law for the wholly unsubstantiated conclusion that Philadelphia County has exclusive jurisdiction over the CRUT. 3 While not identified in the Decree,presumably the CRUT is one of charitable remainder trusts referenced by Judge Lazarus. 3 Under 20 Pa. C.S.A. §7714, "venue for a judicial proceeding involving a trust is in the county of this Commonwealth in which trust's situs is located, and, if the trust is created by will and the estate is not yet closed, in the county in which the decedent's estate is being administered." The CRUT at issue herein does not identify a situs of the trust. In that event, the situs of a testamentary trust shall be in the county where letters were granted to the personal representative. 20 Pa. C.S.A. §7708 (b)(1)(i). See also 20 Pa. C.S.A. §722 ("When a Pennsylvania court has jurisdiction of any trust ... the venue for all purposes shall be in the county where at the time being is the situs of the trust. The situs of the trust shall remain in the county of the court which first assumed jurisdiction of the trust,unless and until such court shall order a change of situs under the provision of this chapter." (emphasis added)). Here, the proper venue has been and remains Cumberland County. 2. After reasonable investigation, the Charitable Beneficiaries are without knowledge or information sufficient to form a belief as to the averments regarding Mr. Chapman's "repeated requests"to M&T for distribution from the CRUT to pay various alleged obligations of Alfred McCrea Chapman, and that requests have been"ignored or denied"by M&T. However, it is absolutely clear that any refusal by M&T to make distributions from the CRUT to pay these expenses claimed by Mr. Chapman is absolutely appropriate and in compliance with its fiduciary obligations. Not only is M&T's refusal to pay such claims required by the terms of the CRUT, Mr. Chapman's assertion in the Objections, in light of prior litigation on this very same issue, is both astounding and inexplicable. As should be clearly reflected in the docket of this Honorable Court, over three years ago (March 8, 2011), Mr. Chapman, again in his individual capacity and as guardian of Alfred McCrea Chapman (as well as his siblings), filed a Petition For Rule To Show Cause why the trustees of the 4 CRUT "should not pay all the legitimate, as well as specific court-ordered expenses for the care, maintenance and support of Alfred M. Chapman." This matter eventually proceeded to a hearing on October 4, 2011 before the Honorable Kenneth A. Mummah of the 41"Juridical District, Specially Presiding. In an Order dated December 29, 2011, Judge Mummah denied in all respects the relief sought by Mr. Chapman. For convenient reference, a copy of Judge Mummah's Order dated December 29, 2011 is attached hereto as Exhibit"A." This Order was not appealed. It appears that in these Objections, Mr. Chapman is raising the same issues and seeking the same relief which he has previously sought and been denied. It further appears that Mr. Chapman's attempt to transfer venue to Philadelphia County may represent a classic example of "forum shopping" (albeit after-the-fact; the defenses of res judicata and estoppel apply whether these claims were revisited in Cumberland County or Philadelphia County). In light of the clear denial of Mr. Chapman's prior Petition and in the face of the unappealed Order of Judge Mummah, it is difficult to understand how Mr. Chapman can complain in good faith that his requests for distributions from the CRUT to pay expenses of his father have been ignored or denied by the Trustee. Mr. Chapman already sought judicial relief to compel the Trustee to make these payments and his efforts were denied. That battle is over. 3. The Charitable Beneficiaries have not objected to the Accountant's charges for its trustee and counsel fees and take no position on this particular objection. However, the portion of this paragraph that asserts that the Trustee"ignored Philadelphia judicial decrees to provide disbursements to others" deserves close attention. If Mr. Chapman is claiming, as appears to be the case, that a judge in Philadelphia County has ordered M&T as Trustee to make distributions from the CRUT to unidentified"others,"Mr. Chapman should have attached those decrees as exhibits to the Objections (as he did for Exhibits "A." and `B"). The Charitable Beneficiaries are 5 aware of no such decrees, and assert that if such decrees have, in fact,been entered, they are contrary to Judge Mummah's Order, in total disregard of the terms of the CRUT and Pennsylvania law, and were entered without notice to them, thereby denying the Charitable Beneficiaries due process. WHEREFORE, the Charitable Beneficiaries respectfully request that this Honorable Court deny Mr. Chapman's request to transfer the audit of this Third and Partial Account to the Court of Common Pleas of Philadelphia County under Orphans Court control number 1061 of 2009, and that this Honorable Court retain jurisdiction of this and all future proceedings involving the CRUT. Respectfully submitted, Date: October 23, 2014 By: ^^�'� Daniel L. Sullivan, Esquire Attorney I.D. 34548 26 West High Street Carlisle, PA 17013 (717) 243-6222 -Phone (717) 243-6486 - Fax dsullivangssr-attorneys.com Attorneys for Brown University, Dickinson College and Dickinson School of Law of the Pennsylvania State University 6 IN RE: :IN THE COURT OF COMMON PLEAS :OF PENNSYLVANIA— :CUMBERLAND COUNTY ESTATE OF SARAH MCCREA :ORPHANS COURT DIVISION CHAPMAN JONES,LATE OF :NO. 21-2009-329 LOWER MIFFLIN TWP., CUMBERLAND COUNTY, PA, DECEASED ORDER AND NOW,December 29, 2011, after review of the Petition For Rule To Show Cause,filed by Henry L. Chapman as Guardian of Alfred McCrea Chapman,Karen E. Chapman, individually,Katherine Chapman Michalka,individually and after hearing, and after review of the testimony and all legal Memorandum filed hereon,the Petitioner's request to reform the Charitable Remainder Trust, in order to pay expenses, care, maintenance and support of Alfred McCrea.Chapman, is hereby DENIED. BY THE COURT, KENNETH A. MUMMAH, JUDGE 41"Judicial District Specially Presiding cc: Jeffrey B. Boswell,Esq. Ivo V. Otto,III,Esq. James D. Flower,Jr.,Esq. John McCrea,IIIA _ Michael T. Foerster, Esq. ,',^ c� _= Daniel Sullivan,Esq. Dickinson School of Law '_"' .4 The National Trust for Scotland _ Episcopal Diocese of Central Pennsylvanian Perry County Court Administrator Cumberland County Court Administrator CERTIFICATE OF SERVICE AND NOW,October 23,2014,I,Daniel L. Sullivan,Esquire,hereby certify that I did serve a true and correct copy of the foregoing document upon counsel of record and unrepresented parties by depositing, or causing to be deposited, same in the U.S. mail, postage prepaid, at Carlisle, Pennsylvania, addressed as follows: By First Class Mail: Rosemary R. Ferrino, Esq. Barbara McLemore, Chancellor 1501 Lower State Road Episcopal Dioceses of Central Pennsylvania North Wales, PA 19454 P. O. Box 11937 Harrisburg, PA 17108 Seth Mosebey, Esq. 10 East High Street Carlisle, PA 17013 Michael T. Forester, Esq. Office of the Attorney General 14th Floor— Strawberry Square Harrisburg, PA 17120 Katherine C. Michalka 250 Loche Lloyd Parkway Belton, MO 64042 John McCrea, III P. O. Box 341 Newville, PA 17241 Karen E. Chapman 1858 San Lorenzo Avenue Berkley, CA 94707 SAIDIS, SULLIVAN & ROGERS By: Daniel L. Sullivan, Esquire Attorney I.D. 34548 Attorney for Defendants 26 West High Street Carlisle, PA 17013 Phone (717)243-6222 Fax (717) 243-6486 dsullivankssr-attorne s com 7