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Home My WebLink About2009-5736 Civil BRIAN M. CRUM, : IN THE COURT OF COMMON PLEAS OF PLAINTIFF : CUMBERLAND COUNTY, PENNSYLVANIA : V. : : HORACE M. CRUM, SR., EXECUTOR : OF THE ESTATE OF HORACE M. : CRUM, JR., : DEFENDANT : 09-5736 CIVIL TERM IN RE: DEFENDANT’S MOTION TO STRIKE BEFORE OLER, J., GUIDO, J. AND MASLAND, J. OPINION AND ORDER OF COURT Masland, J., July 20, 2010:-- Now before the court, defendant, Horace M. Crum, Sr., Executor of the estate of Horace M. Crum, Jr. (Father) moves to strike the complaint of Brian M. Crum (Son) for lack of jurisdiction. Executor argues Son's suit against Father's estate for the value of unmaintained life insurance policies must proceed in Orphans' Court rather than the Civil Division. Following briefing by the parties and argument en banc, we deny Executor's motion. I. Background Son sues the Executor of Father's estate for the value of life insurance policies Father was obligated to maintain for Son's benefit. This obligation arose from the 1975 separation agreement between Father and Judith A. Crum (Mother), wherein Father agreed to maintain life insurance policies for Son's benefit valued at $25,000. As this portion of the separation agreement is central to the instant matter, it is quoted in its entirety: 06-3615 CIVIL TERM [Father] agrees to maintain in force the insurance policies listed below of which the [Mother] and minor child [Son] are beneficiaries and to pay the premiums thereon. This provision shall continue in effect as long as [Mother] is living and remains married to [Father]. In the event that the [Father] and [Mother] do become divorced the [Father] agrees to maintain in force the same insurance policies and pay the premiums thereon, at which time the beneficiary shall be solely the minor child [Son]. The policies are: (a) Whole life insurance policy with State Farm Mutual Insurance Company, the face amount being $20,000. (b) Whole life insurance policy with Lutheran Brotherhood Insurance Company, the fact amount being $5,000. Separation Agreement at ¶ 9 (emphasis added). Following Father's death, Son made inquiries regarding the insurance policies. At this time, Son first learned the policies were not in effect at the time of Father's death. Apparently, Father cashed in the policies prior to his death and therefore no benefits were payable to Son. Subsequently, Son filed a notice of claim against Father's estate in the amount of $25,000 with the Clerk of the Orphans' Court Division. See Def. Br. Ex. A. Six months later, Son initiated the instant matter by filing a complaint in this court's Civil Division suing Father's estate for the value of the policies. See Def. Br. Ex. B. II. Discussion Executor argues Son's suit seeks distribution of at least $25,000 in estate assets. As such, this matter falls squarely within the Orphans' Court's mandatory jurisdiction over matters concerning decedent's estates, testamentary trusts, and inter vivos trusts, including “a trust created under a deed, agreement, or declaration.” 20 Pa. C.S. §711(1-3). -2- 06-3615 CIVIL TERM Son responds by asserting he has a viable cause of action for breach of contract against Father which is actionable against the estate in the Civil Division. Son argues he is a third-party beneficiary to the settlement agreement and therefore has standing to enforce the agreement and recover damages for breach of contract. Thus, as the Civil Division has unlimited original jurisdiction of contract cases, jurisdiction here is proper. For the following reasons, we agree. A. Standing to Enforce Separation Agreement Son sues Father's estate under the theory he is a third-party beneficiary to his parents' separation agreement. To evaluate this claim, we must determine whether Son has standing to enforce his parents' separation agreement as a third-party beneficiary. In Chen v. Chen, 586 Pa. 297, 893 A.2d 87 (2006), our Supreme Court addressed a similar question in the context of third-party enforcement of child support obligations. There, a daughter sought to enforce the child support provision of her parents' divorce decree and property settlement agreement against her father. The Court of Common Pleas concluded and the Superior Court agreed she was an intended beneficiary of her father's promise to pay her mother child support. As such, she possessed a legally enforceable interest in her parents' separation agreement and was entitled to sue for its enforcement. Our Supreme Court disagreed, with a plurality concluding: [S]trong public policy favors denying a child standing to seek the specific dollar one parent owes the other for the child's generalized support pursuant to a separation agreement, absent special circumstances -3- 06-3615 CIVIL TERM such as a direct designation that a benefit be paid to the child or the custodial parent's inability to enforce the agreement due to death or disability. Id. at 311, 893 A.2d at 96 (emphasis added). Such special circumstances are present in the instant matter. First, Father's obligation to maintain the life insurance policies did not arise as a component of his generalized child support obligations to Mother. Cf. Separation Agreement at ¶¶ 4-6 (detailing Father's weekly support obligations) with ¶ 9 (establishing insurance obligation). Second, paragraph nine of the agreement directly designates Son as the beneficiary of the life insurance benefits. Id. at ¶ 9. By naming Son the policies' beneficiary, Father directly designated that benefits be paid to Son. Thus, for the purposes of the instant motion, we conclude Son has standing to enforce the separation agreement as an intended third-party beneficiary. Chen, 586 Pa. at 311, 893 A.2d at 96. B. Orphans' Court Jurisdiction Ultimately, Executor's position is untenable. He contends, “if [Son] was to succeed in this action, any judgment obtained therein would be paid from assets of the Estate.” Def. Br. at 2. Thus, he reasons, this matter must be pursued in the Orphans' Court division in exercise of its mandatory jurisdiction over matters concerning a decedent's estate, testamentary trusts, and inter vivos trusts. See 20 Pa. C.S. §711(1-3). We disagree. To endorse executor's interpretation of the Orphans' Court jurisdiction would render the Civil Division's plenary jurisdiction over contract disputes a nullity so long as the breaching defendant is deceased. Further, Executor's -4- 06-3615 CIVIL TERM interpretation would serve to deny a plaintiff his right to a jury trial in a contract case. As our Supreme Court stated: [t]he most striking difference between pursuing the action at law in the civil division and proceeding in the orphans' division is in the right to a jury trial. The submission of any or all issues of fact to a trial by jury rests in the discretion of the court if the action is commenced in the orphans' court division. Article I, section 6 of the Pennsylvania Constitution “... has been construed as requiring the right to trial by jury in all matters in which the right to a jury trial has been recognized at the time of the adoption of the Constitution of 1790. The right to a jury trial in this matter may not be circumvented by a transfer from one division of the court to another. Baskin & Sears v. Edward J. Boyle Co., 506 Pa. 62, 68, 483 A.2d 1365, 1368 (1984) (citations omitted) (emphasis added). We reach the same conclusion here. Throughout the instant litigation, Son has demanded a jury trial. See Compl. at 1. In light of Son’s consistent assertion of his constitutional right, we must deny Executor’s motion to strike. Further, Son's contract claim against his father's estate is only collaterally related to the administration of the estate and therefore is not a matter arising under the Orphans' Court's mandatory jurisdiction. III. Conclusion In short, we conclude Son's cause of action against Father's estate for breach of contract should proceed in the Civil Division. Executor's motion to strike Son's complaint is denied. -5- 06-3615 CIVIL TERM ORDER OF COURT AND NOW, this day of July, 2010, the defendant’s motion to IS DENIED. strike, By the Court, Albert H. Masland, J. Dennis R. Sheaffer, Esquire For Plaintiff Neil Warner Yahn, Esquire For Defendant :sal -6- BRIAN M. CRUM, : IN THE COURT OF COMMON PLEAS OF PLAINTIFF : CUMBERLAND COUNTY, PENNSYLVANIA : V. : : HORACE M. CRUM, SR., EXECUTOR : OF THE ESTATE OF HORACE M. : CRUM, JR., : DEFENDANT : 09-5736 CIVIL TERM IN RE: DEFENDANT’S MOTION TO STRIKE BEFORE OLER, J., GUIDO, J. AND MASLAND, J. ORDER OF COURT AND NOW, this day of July, 2010, the defendant’s motion to IS DENIED. strike, By the Court, Albert H. Masland, J. Dennis R. Sheaffer, Esquire For Plaintiff Neil Warner Yahn, Esquire For Defendant :sal