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HomeMy WebLinkAbout97-1634 civilSHIRLEY L. PETRESKY .and SAMUEL R. COMP, Plaintiffs VS. RAY K. JUMPER, Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 97-1634 CIVIL CIVIL ACTION - LAW AND NOW, this IN RE: DEFENDANT'S MOTION FOR SIIMMARY JUDGMENT BEFORE HOFFER, P.J. AND HESS. J. ORDER ! ~/~' day of January, 1998, the motion of the defendant for summary judgment is DENIED. Marcus A. McKnight, III, Esquire For the Plaintiffs H. Anthony Adams, Esquire For the Defendant :rim BY THE COURT, . Hess, J. SHIRLEY L. PETRESKY and : SAMUEL R. COMP, : Plaintiffs : : vs. : 97-1634 CIVIL : RAY K. JUMPER, : Defendant : CIVIL ACTION - LAW IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA IN RE: DEFENDANT'S MOTION FOR SUMMARY JUDGMENT BEFORE HOFFER. P.J. AND HESS, J. OPINION AND ORDER In this case, a motion for summary judgment has been filed by the defendant, Ray K. Jumper, regarding the complaint filed by the plaintiffs, Shirley L. Petresky and Samuel R. Comp. The facts, therefore, are viewed in the light most favorable to plaintiffs. The defendant was the brother of Rhoda E. Comp and the plaintiffs were her adoptive children. Defendant resided with Mrs. Comp at 670 Mount Rock Road, Carlisle, Pennsylvania 17013. He maintained no ownership interest in the property and stayed there rent free. In April of 1993, Mrs. Comp's health began to fail and plaintiffs and defendant discussed various options of dealing with the situation. Defendant, Plaintiffs and Mrs. Comp agreed that the real estate would be conveyed to defendant, who would reside on the property until his death at which time the property would transfer to plaintiffs through defendant's will. Plaintiffs would also serve as the Powers of Attorney for Mrs. Comp. On May 9, 1993, a deed conveying the farm to defendant and a Power of Attorney for Mrs. Comp were executed by Mrs. Comp. At the same time, defendant executed a will naming plaintiffs as his sole heirs. In June of 1993, plaintiffs and defendant agreed to sell timber from the farm and the household goods of Mrs. Comp. The funds were to be used to first pay the expenses of Mrs. 97-1634 CIVIL Comp and then be divided equally among plaintiffs and defendant. To facilitate this arrangement a joint account was opened at Meridian Bank. The proceeds from the sales were turned over to defendant, who was to manage the income for the benefit of all parties. Shirley Petresky contacted a realtor to subdivide the farm and sell various lots to raise funds for their mother's care. Defendant completed the subdivision and from June 1994 to June 1995 sold the entire farm in parcels to various parties. From the sale of the real estate, defendant received the sum of $484,203.00. He also received an undetermined amount of money from auctions of Mrs. Comp's personal goods and two timber sales. In April of 1994, during a conversation with Samuel Comp, defendant stated that he would no longer divide the funds equally with plaintiffs. He also stated that he wanted one-half of all remaining funds with the other half to be split between plaintiffs. Shortly thereafter, on or about May 16, 1994, defendant closed the joint account at Meridian Bank without notifying plaintiffs and placed Mrs. Comp's fimds into his own account. On January 12, 1995, Mrs. Comp died. At that time the defendant had control of all of her assets. Defendant did not provide plaintiffs with an account of the funds that he had acquired from Mrs. Comp. In February of 1996, Shirley Petresky confronted defendant regarding the payment of Mrs. Comp's expenses and a final account and distribution of the remaining funds. Defendant responded by stating that he needed all of the remaining funds and that no accounting or distribution would be performed. In considering a motion for summary judgment, the court must examine the record in the 2 97-1634 CIVIL light most favorable to the nonmoving party and must resolve all doubt against the moving party. Fletcher v. Raymond Corp., 424 Pa. Super. 605, 609, 623 A.2d 845, 847 (1993). Judgment may only be entered in this fashion if the moving party demonstrates that there are no genuine issues of material fact and that they are entitled to judgment as a matter of law. Grossman v. Rosen, 424 Pa. Super. 463,465,623 A.2d 1, 2 (1993). Summary judgment should only be granted where the right is free from doubt. Johnson v. Harris, 419 Pa. Super. 541,549, 615 A.2d 771,775 (1992). We believe defendant's motion for summary judgment must fail for two reasons. First, defendant is not entitled to judgment as a matter of law as there is, if accepted by the fact finder, sufficient evidence to show the creation of a constructive trust. Second, there are genuine issues of material fact as to whether there was an agreement between the parties concerning the disposition of Mrs. Comp's property. Defendant maintains that plaintiffs must establish the existence of an express agreement to make a specific bequest in order to establish an essential element in the plaintiffs' cause of action. Moreover, defendant argues that such an agreement must be in writing pursuant to 20 Pa.C.S.A. Section 2701. We disagree as we believe plaintiffs have pled facts sufficient to support the creation of a "constuctive trust." While the Statute of Frauds, Act of April 22, 1856, P.L. 532, 33 P.S. Section 2, generally bars the introduction of evidence of an oral agreement modifying a deed transfering land in fee simple, the Pennsylvania Supreme Court has adopted the Restatement (Second) of Trusts Section 3 97-1634 CIVIL 44 (1959), as an exception to the Statute of Frauds. Truver v. Kennedy, 425 Pa. 294, 304-05, 229 A.2d 468, 473 (1967). Section 44 provides: (1) Where the owner of an interest in land transfers it inter vivos to another in trust for the transferor, but no memorandum properly evidencing the intention to create a trust is signed, as required by the Statute of Frauds, and the transferee refuses to perform the trust, the transferee holds the interest upon a constructive trust for the transferor,. if (a) the transfer was procured by fraud, duress, undue influence or mistake, or (b) the transferee at the time of the transfer was in a confidential relation to the transferor, or (c) the transfer was made as security for an indebtedness of the transferor. Restatement of Trusts (Second) Section 44 (1959). For purposes of this case, Plaintiffs must prove that there existed a confidential relationship and a promise to reconvey the property that was induced by the confidential relationship. Kadel, 425 Pa. Super. at 253,258, 624 A.2d at 1059, 1061 (1993). A constructive trust is created by equity and is used to prevent unjust enrichment or to redress a wrong. See Huber v. Wagner, 284 Pa. Super. 133,137, 425 A.2d 456, 458 (1981). A constructive trust "exists whenever one holding title to property is subject to an equitable duty to convey it to another on the ground that he would be unjustly enriched if he were permitted to retain it." Id_~. Therefore, defendant's argument that a writing is required would be correct if an explicit trust was being alleged, but in the context of a constructive trust his argument must fail. We believe that the facts, when viewed in the light most favorable to plaintiffs,do not establish that defendant is entitled to judgment as a matter of law. The trier of fact could 4 97-1634 CIVIL conclude that Mrs. Comp transferred the real estate to defendant in trust for plaintiffs, even though no writing exists evidencing the intention to create a trust, so long as one of the three above conditions is met. Again, the appropriate condition in this case is that a constructive trust may be shown where there is a confidential relationship between the transferor and the transferee. The Pennsylvania Supreme Court has said such a relationship "exists whenever one occupies toward another such a position of advisor or counselor as reasonably to inspire confidence that he will act in good faith for the other's interest." Silver v. Silver, 421 Pa. 533, 537, 219 A.2d 659, 662 (1966). The Supreme Court has also said that this special relationship exists because of a family relationship if the transferor is "accustomed to be guided by the judgment of the transferee or is justified in placing confidence in the belief that the transferee will act in the interest of the transferor." Metzger v. Metzger, 338 Pa. 564, 570, 14 A.2d 285, 288 (1940) (quoting Restatement of Trusts, Section 44, Comment (c)). We believe plaintiffs have pled facts sufficient to justify their placing trust in the defendant that he would act in all of the parties' best interests. He had lived with Mrs. Comp for several years and plaintiffs claim they enjoyed a close relationship with him as well. We believe plaintiffs have alleged the basis for a confidential relationship, and have averred facts that provide a proper basis for the creation of a constructive trust based upon the unjust enrichment of defendant. Coneming the creation of a constructive trust, them are disputes of fact. The plaintiffs contend that all parties came to an agreement whereby the defendant would be allowed to reside 97-1634 CIVIL on the property until his death at which time the property would pass to the plaintiffs by will. Defendant's answer denies this and states that there was "no agreement creating a contract to will or life estate."~ Furthermore, defendant denied that the agreement was implemented by "Mrs. Comp executing a deed conveying the subject real estate to defendant Jumper, by execution of a power of attorney from Mrs. Comp to the plaintiffs, and by the execution of a will by the defendant in which plaintiffs were named as the sole heirs.''2 Finally, plaintiffs allege that all parties agreed to sell timber from the subject real estate along with the personal goods of Mrs. Comp, whereby the proceeds would be used to pay Mrs. Comp's expenses with the remaining funds divided equally between plaintiffs and defendant. Defendant denies this assertion saying simply that he "sold the timber from the farm that was given to him.''3 Each of these denials go to the essence of plaintiffs' cause of action in that they provide the basis for the formation of a constructive trust. Defendant has created genuine issues of material fact by his denials of these facts and therefore summary judgment is precluded. ORDER AND NOW, this ! c/*- day of January, 1998, the motion of the defendant for Defendant's Answer, paragraph 11. Defendant's Answer, paragragh 12. Defendant's Answer, paragraph 16. 97-1634 CIVIL summary judgment is DENIED. BY THE COURT, Marcus A. McKnight, III, Esquire For the Plaintiffs Jo H. Anthony Adams, Esquire For the Defendant :tim 7