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Home My WebLink About10-09-06 " MICHAEL L. BANGS, ESQUIRE I.D. No. 41263 429 South 18th Street Camp Hill, PA 17011 (717) 730-7310 CATHERINE A. McKINNEY, Settlor of ) The Patricia M. Kilkenny Family ) Irrevocable Trust and PATRICIA M. ) ~LKENNY, ) Petitioners ) ) vs. ) ) COMMUNITY TRUST COMPANY, ) Respondent ) ATTORNEY FOR PETITIONERS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA ORPHANS' COURTDIVISIW (;0 NO. 21-06-553 o:oSi~t~ -:jo) f') c::::;) C;::) 0.... o ("") --I I U) ,/"... (-) )::'II 1'1 :JJ: 9? N PETITIONERS' OBJECTIONS TO RESPONDENT'S FIRST AND FINAL ACCOUNT DATED SEPTEMBER 5. 2006 These Objections are filed by the Petitioners to the Accounting filed by Respondent pursuant to the directive contained in the Order of Court dated August 6, 2006. These Objections are to be considered along with other matters raised by the Petitioners at the Hearing on November 29,2006 pursuant to the Order of Court dated August 6, 2006 and revised by Order dated August 22, 2006. OBJECTIONS 1. Petitioners object to the acquisition of an appraisal on February 9, 2005, and the payment for that appraisal. Neither of the Petitioners was notified nor requested this appraisal and there was no basis for the Trustee to obtain that appraisal without prior approval of either one of the Petitioners. 2. Petitioners object to disbursements and payments of all Trustee's fees from the inception to date in that the Trustee's fees were unreasonable; not authorized; and not disclosed prior to the inception of the trust. 1 :0 -n '"~ 1"i'1 c> (-;:-~~ ~C) c::;8 ~ _ ---n ~~~ c.oC) -TO\ ~ 3. Petitioners object to payment of any monthly commissions that are claimed due and owing to the Trustee as indicated on its Proposed Schedule of Distribution. The proposed commissions are unreasonable under the circumstances of this trust; were not disclosed to the Petitioners prior to the inception of this trust by either Trustee or Trustee's agent; are excessive and not warranted by the responsibilities of this trust; and were incurred solely because of Trustee's unwillingness to cooperate with the removal of certain assets under the trust by the exercise of the power of appointment permitted under the trust document. 4. Petitioners object to any termination fee that is requested under the Proposed Schedule of Distribution in that the termination fees are excessive and unreasonable and not warranted under the circumstances of this matter; the termination fees were not disclosed to Petitioners at the inception of this trust by either the Trustee or Trustee's agent; the termination fees are excessive and not reasonable nor typical of those that are charged by trustees in similar circumstances; the termination fee was not warranted given the fact that the Trustee refused to accept the requested power of appointment over certain assets that were directed to it by Petitioners. 5. Petitioners object to any legal fees being paid to the law firm of Keefer Wood Allen & Rahal. The legal fees as indicated under the Proposed Schedule of Distribution are excessive and unreasonable. The legal fees were incurred solely and directly as a result of the Trustee's unwillingness to timely cooperate with Petitioners and Petitioners' counsel with requests for information and for requests to obtain power of appointment over assets as permitted by the trust. 2 Further, the legal fees were incurred solely as a result of the Trustee's breach of trust and breach of its fiduciary responsibilities in its duties to the Petitioners and its duty of loyalty to both. 6. Petitioners object to the repayment of any disbursement that was paid on August 31, 2006 by the law firm of Keefer Wood Allen & Rahal or Trustee. Petitioners assume that this disbursement is some type of filing fee which was not authorized nor requested by Petitioners. Moreover, the disbursement was as a result of the unwillingness of Trustee to provide timely information to Petitioners and Petitioners' counsel and more importantly, was as a result of the Trustee's unwillingness to honor a legitimate power of appointment over certain assets of the trust. Finally, any costs that were incurred by Trustee were incurred solely as a result of its breach of trust and breach of fiduciary responsibility and further by breach of its duty of loyalty to the Petitioners in this case. 7. Petitioners object to payment of any additional fees estimated on the Proposed Schedule of Distribution to Keefer Wood Allen & Rahal or payment of any other legal fees for Trustee's defense of this claim. The legal fees indicated are excessive and unreasonable under the circumstances of this case. Any legal costs incurred by the Trustee are incurred solely as a result of Trustee's failure to properly respond in a timely fashion to Petitioners or Petitioners' counsel's request for information and for the request to exercise a proper power of appointment over certain assets of the trust. Furthermore, Trustee's legal fees are incurred solely as a result of its breach of its fiduciary responsibility and its breach of its duty of loyalty to the Petitioners. 8. Petitioners object to the payment of any legal costs to the law firm of Gates, Halbruner & Hatch, P.C. Petitioners never authorized the hiring of the law firm of Gates, Halbruner & 3 Hatch to prepare that document and it is ethically impermissible for the Trustee to engage the same counsel that was counsel for Petitioners in this case without a written authorization from Petitioners permitting that to occur. The law firm of Gates, Halbruner & Hatch had a conflict of interest in this matter and should not have provided legal work to the Trustee in matters related to the Petitioners without prior written consent of Petitioners. 9. Petitioners object to the miscellaneous fees and expenses as outlined in the Proposed Schedule of Distribution. Specifically, Petitioners object to any fees for the filing of the First and Final Account and any fees for the preparation and recording of the Deed. The Proposed Schedule of Distribution does not outline the purpose of these costs. Moreover, these costs are solely incurred as a result of the Trustee's failure to respond to legitimate requests made by the Petitioners or Petitioners' counsel; failure of the Trustee to accept the Petitioners' power of appointment over certain assets in the trust; and the breach of trust by the Trustee along with its breach of fiduciary responsibility and breach of loyalty. 10. Petitioners object to the First and Final Account of the Trustee filed in this case because the Trustee has engaged in a breach of trust, breach of fiduciary responsibility and breach of loyalty to the Petitioners in that it has charged fees that were not disclosed at the inception of the trust; it has charged fees that are excessive and unreasonable under the circumstances of the duties and responsibilities under this trust; it has breached its duty of loyalty to the Petitioners. 11. Petitioners object to the First and Final Account of the Trustee because Trustee has engaged in the breach of the trust by its failure to respond to the reasonable requests of 4 Petitioners and/or Petitioners' counsel during the course of its administration of the trust; by its failure to accept a proper power of appointment over certain assets of the trust that was sent to it by Petitioners and or Petitioners' counsel during the administration of this trust; by its breach of loyalty to the Petitioners; by its breach of trust and breach of fiduciary responsibility to the Petitioners. As a result of these actions by the Trustee, the Petitioners have been damaged as a result of the improper paYment of fees during the administration of the trust and as a result of the paYment of attorney's fees to require Trustee to act in accordance with its responsibilities as Trustee toward the Petitioners under this trust. 12. Petitioners object to the First and Final Account filed by Trustee in that the Trustee had an impermissible conflict of interest which was undisclosed at the time of the inception of this trust in that the counsel for the Petitioners who drafted the trust document and originally engaged the Trustee was and is an owner and founder of the Trustee and operated as legal counsel for Trustee. Trustee had a duty to act in the best interest of the Petitioners and as such, had a responsibility to make the disclosures of these conflicts prior to taking on the role as Trustee in this case. As a result of this conflict, Petitioners have incurred damages which include, but are not limited to, fees charged by Trustee during the administration of the trust and legal fees incurred by Petitioners as a result of the breach of Trustee's duty ofloyalty to the Petitioners. RespeC:;;;jed. 7-p ~L L. BANGS Attorney for Petitioners 5 VERIFICATION I hereby verify that the statements made in the foregoing Petitioners' Objections to Respondent's First and Final Account are true and correct. I understand that false statements herein are made subject to the penalties of 18 Pa. C.S. Section 4904, relating to unsworn falsification to authorities. Date: IO~/o' ~<<~ CATHERINE A. McKINNEY , t.. ' VERIFICATION I hereby verify that the statements made in the foregoing Petitioners' Objections to Respondent's First and Final Account are true and correct. I understand that false statements herein are made subject to the penalties of 18 Pa. C.S. Section 4904, relating to unsworn falsification to authorities. Date: /0' t/. t) ~ I~ 'h ~ PATRICIA M. KILKENNY . . , . CERTIFICATE OF SERVICE I HEREBY CERTIFY that I have this day served the foregoing PETITIONERS' OBJECTIONS TO RESPONDENT'S FIRST AND FINAL ACCOUNT, by depositing a copy of the same in the United States mail, postage prepaid, at Camp Hill, Pennsylvania, addressed to the following: Todd F. Truntz, Esquire Keefer Wood Allen & Rahal 415 Fallowfield Road, Suite 301 Camp Hill, P A 17011-4906 DATE: l olk.l ole ~ lha~c WENDY S RAUB Paralegal 7 BANGS LAW OFFICE 429 SOUTH 18TH STREET CAMP HILL, P A 17011 E-mail: mikebangs@verizon.net PHONE: 717-730-7310 FAX: 717-730-7374 WILLIAM E. MILLER, JR. Of Counsel MICHAEL L. BANGS, Attorney-at-Law WENDY K. STRAUB, Paralegal October 6, 2006 C2 r--J = c;;;;, C7' o C-) -l I \.D Glenda Farner Strasbaugh, Clerk of the Orphan's Court Cumberland County Courthouse One Courthouse Square Carlisle, P A 17013 :':'P ::.;: ( :' c..::> ; -T\ _ --:1 -(--=) ;n CP. N RE: Catherine A. McKinney, et al. vs. Community Trust Company Orphans' Court No. 21-06-553 Dear Mrs. Strasbaugh: Enclosed you will find Petitioners' Objections to the First and Final Account filed by Community Trust Company on September 5, 2006 together with a check in the amount of$5.00 to pay the filing fee. Please be advised that the original Accounting was filed as a result of an Order by Judge Oler on August 6, 2006 and this matter is scheduled for a hearing on November 29,2006 at 9:30 a.m. Therefore, the Accounting and Objections thereto should not be put before the court for its confirmation of accounts scheduled for October 10, 2006. \~~\ Michael L. Bangs wks Enclosure cc: Mrs. Patricia M. Kilkenny Mrs. Catherine A. McKinney Todd F. Truntz, Esquire