In re Estate of McDermott

37 Pa. D. & C.5th 328
CourtPennsylvania Court of Common Pleas, Lycoming County
DecidedMarch 24, 2014
DocketNo. 41-11-0215
StatusPublished

This text of 37 Pa. D. & C.5th 328 (In re Estate of McDermott) is published on Counsel Stack Legal Research, covering Pennsylvania Court of Common Pleas, Lycoming County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Estate of McDermott, 37 Pa. D. & C.5th 328 (Pa. Super. Ct. 2014).

Opinion

LOVECCHIO, J.,

This matter came before the court on preliminary objections filed by Cheryl Breen and John McDermott II to the petition to compel the transfer of assets filed by Pennsylvania Department of Public Welfare (DPW). The relevant facts follow.

On January 31, 2011, Arlene McDermott died. Prior to her death, her daughter Cheryl Breen and son John McDermott, II filed a joint petition to adjudicate Ms. McDermott as an incapacitated person and for them to be appointed the plenary co-guardians of her person and estate, and a petition to authorize said guardians to expend principal to implement an estate plan (hereinafter “guardianship and estate petition”). This petition was filed under No. 41-08-0470 in the Court of Common Pleas of Lycoming County, Orphan’s Court Division.

[330]*330By order of court dated September 12, 2008, a hearing on the guardianship and estate petition was scheduled for December 23,2008. Service of the petition and scheduling order was not made on the Pennsylvania Department of Public Welfare (DPW), and no representative of DPW appeared at the hearing.

Following the hearing, the guardianship and estate petition was granted and Ms. Breen and Mr. McDermott (hereinafter “co-guardians”) were appointed plenary co-guardians of Ms. McDermott’s person and estate.

Prior to the appointment of co-guardians and while competent, the deceased executed both a last will and testament and a durable power of attorney.

The durable power of attorney appointed her daughter Cheryl Breen as her lawful agent and among other powers, gave her the authority to make gifts and transfers, in her sole discretion, which would “help qualify” her for public or private benefits.

The final order appointing the co-guardians gave them the authority, among other things, to make decisions regarding the available income and assets to benefit the estate and to authorize any contracts for public assistance, Social Security or other benefits; and the power to implement a long term healthcare plan, execute an irrevocable trust, purchase an annuity, transfer life insurance policies owned by the incapacitated person, and seek to qualify the incapacitated person for medical assistance benefits and transfer real estate to an irrevocable trust owned by the incapacitated person.

[331]*331The co-guardians subsequently created the Arlene L. McDermott Real Estate Protector Trust (the “trust”) and, during Ms. McDermott’s life, transferred her assets in the approximate amount of $65,000.00 to the trust.

On or about May 1, 2010, Ms. McDermott qualified to receive medical assistance from DPW. From May 1, 2010 through January 31, 2011, DPW provided medical assistance to Ms. McDermott in the approximate amount of $45,000.00.

Following Ms. McDermott’s death, DPW asserted a claim against her probate estate in the approximate amount of $45,000.00 for reimbursement of the medical assistance. Counsel for her estate, however, informed DPW that the gross value of the probate assets of the estate was less than $2,400.00. The assets in the trust, however, as of Ms. McDermott’s death were over $65,000.00.

On August 5,2013, DPW filed a petition to compel the co-guardians to transfer assets from the trust to decedent’s probate estate. On September 16, 2013, the co-guardians filed preliminary objections to DPW’s petition. On October 1, 2013, DPW filed a response in opposition to the preliminary objections.

A conference was held before the court on October 23, 2013. Following the conference, the court directed that the parties file respective briefs. The brief in support of the preliminary objections was filed on December 23, 2013 while the brief in opposition was filed on January 22, 2014. This matter is now ripe for a decision.

The preliminary objections to the petition to compel [332]*332consist of a demurer and failure to join a necessary party. The request for a demurer is based on four separate arguments.

The co-guardians assert that DPW has failed to establish a legally cognizable cause of action for the following reasons: the Lycoming County Orphan’s Court had jurisdiction to enter the decree, DPW lacks standing to sue, the court had authority to grant the co-guardians gifting powers, and the agent under the power of attorney was already granted expansive unlimited gifting powers explicitly allowed under the statute. Co-guardians failed to address their preliminary objection in the nature of the failure to join a necessary party in their brief. Accordingly, the court will deem said objection waived and will address only those arguments asserted in their brief relating to the demurrer.

Rule 1028 (a)(4) of the Pennsylvania Rules of Civil Procedure provides that a party may file a preliminary objection based on the legal sufficiency, or insufficiency, of a pleading (demurer). A demurer tests the legal sufficiency of the complaint. Sullivan v. Chartwell Inv. Partners, LP, 873 A.2d 710, 714 (Pa. Super. 2005). A demurer should be granted only in situations that are clear and free of doubt. Bourke v. Kazaras, 746 A.2d 642, 643 (Pa. Super. 2000). When sustaining a demurer, the trial court must be satisfied that the claims on the face of the complaint cannot be sustained. Sullivan, 873 A.2d at 714. If doubt or uncertainty exists, the trial court should overrule the demurer. Id. In deciding a demurer, the court must resolve the issues solely on the basis of the pleadings; no [333]*333testimony or other evidence outside of the complaint may be considered to dispose of the legal issues presented by a demurer. Mellon Bank, N.A. v. Fabinyi, 650 A.2d 895, 899 (Pa. Super. 1994) (citations omitted). All well and clearly pled material, factual averments and fairly deducible inferences can be considered. Myers v. Ridge, 712 A.2d 791, 794 (Pa. Commw. 1998).

Co-guardians first argue that DPW’s petition should be dismissed because the court’s December 23, 2008 decree is not subject to collateral attack by DPW and/or DPW does not have standing to bring its petition. Co-guardians argue the lack of standing to collaterally attack based on sections 5511 and 5525 of the Probate, Estates and Fiduciary (PEF) Code (20 Pa.C.S. §§5511 and 5525), which they contend supports their claim that DPW was not entitled to notice of the competency hearing. They further assert, pursuant to section 5523, that the decree cannot be collaterally attacked on account of any irregularity, because the court had jurisdiction to enter the order.

DPW counters that it was an interested party under the law and that it was entitled to notice. DPW argues that because it was not provided notice, the court did not have jurisdiction to enter the decree and it is subject to collateral attack.

The guardianship and estate petition included both a petition to appoint a guardian and a petition to authorize the guardian to expend principal and implement an estate and long term care plan and to make a gift of real estate. It was filed pursuant to both 20 Pa. C.S. § 5511 and 20 Pa. [334]*334C.S. §5536.

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Related

Sullivan v. Chartwell Investment Partners, LP
873 A.2d 710 (Superior Court of Pennsylvania, 2005)
Myers v. Ridge
712 A.2d 791 (Commonwealth Court of Pennsylvania, 1998)
Mellon Bank, N.A. v. Fabinyi
650 A.2d 895 (Superior Court of Pennsylvania, 1994)
Bourke v. Kazaras
746 A.2d 642 (Superior Court of Pennsylvania, 2000)
In Re Estate of Alexander
758 A.2d 182 (Superior Court of Pennsylvania, 2000)

Cite This Page — Counsel Stack

Bluebook (online)
37 Pa. D. & C.5th 328, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-estate-of-mcdermott-pactcompllycomi-2014.