NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-4392-17T1
IN THE MATTER OF THE ESTATE OF GERALDINE FRANKLIN,
Deceased. _________________________
Argued telephonically December 18, 2019 – Decided January 30, 2020
Before Judges Yannotti and Firko.
On appeal from the Superior Court of New Jersey, Chancery Division, Ocean County, Docket No. 211575.
Anthony DeFazio,1 appellant, argued the cause pro se.
Christina Virginia Acker argued the cause for respondent Joel A. Davies, court appointed administrator of the Estate of Geraldine Franklin (Taff, Davies & Kalwinsky, attorneys; Joel A. Davies, of counsel; Christina Virginia Acker, on the brief).
PER CURIAM
1 We note that DeFazio referred to himself as Steffan Anthony Franklin during a part of the trial court proceedings. Anthony DeFazio appeals from orders entered in this action on May 7,
2018, which approved a proposed accounting submitted by the administrator of
the estate, dismissed his order to show cause and verified complaint with
prejudice, and denied other relief. We reverse and remand for further
proceedings.
I.
We begin our consideration of this appeal with a summary of the relevant
facts and procedural history. Geraldine Franklin died on August 5, 2015. She
was survived by three children, DeFazio, Louise Soden, and Kelly Ann Bell. It
appears that Soden claimed Ms. Franklin executed a will on June 5, 2015, which
allegedly designated Soden as executrix or trustee of the estate. Soden sought
to have the will admitted to probate.
On September 28, 2015, DeFazio filed an order to show cause and
verified complaint in the Chancery Division, Probate Part. He asked the court
to invalidate Ms. Franklin's "purported" will, disqualify Soden from serving as
executrix or trustee of the estate, disqualify the attorney who allegedly prepared
the will from participating in the proceedings as Soden's attorney, and grant
other relief.
A-4392-17T1 2 On February 8, 2016, the judge issued an order, which denied without
prejudice DeFazio's motion to disqualify Soden's attorney. The order set forth
a schedule for discovery with a discovery end date of July 17, 2016. Soden's
attorney later withdrew from the matter and filed a substitution of counsel,
which stated that Soden would be thereafter representing herself.
On March 7, 2016, DeFazio served interrogatories and a demand for the
production of documents upon Soden and Soden's former attorney. Thereafter,
DeFazio issued additional discovery requests. On March 28, 2016, Bell filed
motions to compel discovery and require Soden to pay the estate amounts she
allegedly owed on a home equity loan. The judge heard oral argument and on
May 12, 2016, entered an order denying Bell's motions. The judge referred the
matter to mediation, which took place on June 14, 2016, but was unsuccessful.
It appears that Soden and Bell appeared in court on July 28, 2016, and
DeFazio participated by phone because he was incarcerated.2 The parties
apparently agreed to a stipulation of settlement. DeFazio thereafter filed a
motion to vacate the settlement agreement, compel discovery, and impose
2 An order entered by the court in this action on April 13, 2017, states that DeFazio was sentenced on June 19, 1998 to a term of eighty-eight years of incarceration, with a thirty-year period of parole ineligibility. A-4392-17T1 3 sanctions. He claimed he never agreed to the terms of the settlement and asked
the court to vacate the agreement.
On October 3, 2016, the judge conducted a hearing on DeFazio's motion.
Soden asserted that the judge should enforce the settlement. She also reported
to the judge on the estate's assets. Soden told the judge Ms. Franklin had owned
an automobile, but the parties had agreed to return the car because additional
monies were owed for its purchase. Soden stated that Ms. Franklin also owned
a house, which was encumbered by a home equity loan, and she had received a
notice of intent to foreclose on the property. Soden did not know the assessed
value of the property. She told the judge Ms. Franklin had other debts, which
included credit card bills, bills for gas and electric service, and unpaid taxes.
The judge decided that the settlement agreement should be vacated. The
judge gave the parties until October 17, 2016, to file a motion to compel
discovery or resolve the discovery dispute. The judge also said he was
considering the appointment of an independent administrator for the estate, who
would have responsibility for the sale of Ms. Franklin's house.
On October 11, 2016, DeFazio filed a motion to reinstate his previously-
filed motion to compel discovery and to impose sanctions. On October 17, 2016,
the judge filed an order, which vacated the settlement agreement. The order also
A-4392-17T1 4 stated that DeFazio's motion to compel discovery would be converted to an
amended case management order.
In a separate order filed on October 17, 2016, the judge appointed Joel A.
Davies as the independent temporary administrator of the estate. In the order,
the court established a discovery end date of March 15, 2017, and set forth a
schedule for discovery.
On November 16, 2016, DeFazio filed another motion to reinstate his
motion to compel discovery and to impose sanctions for failing to comply with
a court order. On December 12, 2016, DeFazio filed a motion asking the court
to take judicial notice of certain statements Soden made at the October 3, 2016
hearing. On March 9, 2017, the surrogate's office informed the parties that
Soden was no longer seeking to probate Ms. Franklin's alleged will, and that the
estate would be finalized in accordance with the law of intestate succession.
On March 29, 2017, DeFazio filed another verified complaint. He asked
the court to: appoint a permanent administrator, make certain distributions of
the estate, deduct the amount outstanding on Ms. Franklin's home equity loan
from Soden's share of the estate, provide Bell with title to Ms. Franklin's vehicle
free of any debt, and distribute the remainder of the estate in equal shares to
A-4392-17T1 5 himself, Soden, and Bell. Bell and her daughter, Samantha Koch, filed
certifications in support of DeFazio's claims.
On April 13, 2017, the judge filed an order appointing Davies as
permanent administrator for the estate. The judge dismissed DeFazio's demand
for certain distributions of the estate's assets because DeFazio had not stated a
claim for relief upon which such relief could be granted. In the order, the judge
stated that Ms. Franklin's assets would be distributed in accordance with New
Jersey's law on intestate succession.
The judge also ordered Davies to liquidate the estate's assets and submit
a proposed accounting and plan for distribution. The order stated that any party
in interest could file a proof of claim memorializing any debt or liability owed
by the estate, and Davies could file objections to any such claims. In addition,
the judge dismissed without prejudice DeFazio's claim that Ms. Franklin
verbally intended to create a secret trust for his benefit.
On April 13, 2017, Davies informed the parties he intended to provide the
court with the accounting and proposed distribution plan within sixty days after
the closing on the sale of Ms. Franklin's home. The closing occurred on May
23, 2017. In addition, in May 2017, Ms. Franklin's car was repossessed, but
additional monies were owed for its purchase.
A-4392-17T1 6 On September 28, 2017, Davies served the parties with a proposed
accounting and distribution plan. In a letter dated October 3, 2017, DeFazio
asked Davies to decide whether Soden was liable to repay Ms. Franklin's home
equity loan. DeFazio claimed that during the October 3, 2016 court proceeding,
Soden had admitted Ms. Franklin had taken out the home equity loan for Soden's
benefit and that the debt was her debt.
On October 5, 2017, Davies wrote to Soden and asked her to respond to
DeFazio's claim regarding the home equity loan. The following day, DeFazio
wrote to Davies and asserted that he may be under the mistaken belief that a
joint bank account in the names of Ms. Franklin and Soden was a non-estate
asset.
DeFazio and Soden thereafter wrote to Davies. Their letters indicated that
they disagreed on whether Soden was liable for the home equity loan and
whether the money in Ms. Franklin's joint account with Soden was an asset of
the estate. Davies informed DeFazio, Soden, and Bell that if they could not
agree on the accounting and proposed distribution of the estate, he would be
compelled to bring the matter to the court for a decision.
On December 5, 2017, DeFazio filed another verified complaint and order
to show cause. He claimed, among other things, that Soden had agreed she was
A-4392-17T1 7 liable for Ms. Franklin's home equity loan. He also claimed the monies in the
joint bank account were estate assets and not an inter vivos gift from Ms.
Franklin to Soden.
DeFazio sought, among other relief, to compel Davies to deduct the
outstanding balance of about $22,500 on the home equity loan from Soden's
share of the estate, and to include in the estate's assets about $8000, which had
been on deposit in the joint account. DeFazio also asked the court to issue a
discovery schedule, request a specific distribution of the estate, disqualify
Davies from serving as administrator, and appoint a different administrator.
The surrogate's office entered an order dated December 7, 2017, which
required the parties to show cause why the relief DeFazio sought in his verified
complaint should not be granted. Soden and Davies thereafter filed answers to
the complaint. Davies also filed a verified complaint seeking approval of his
accounting and proposed distribution plan.
DeFazio then filed a motion to strike Soden's and Davies's answers to his
complaint. He also filed exceptions to the accounting and distribution plan.
Among other things, DeFazio asserted that Soden was liable for Ms. Franklin's
home equity loan, and that the monies in Ms. Franklin and Soden's joint account
were assets of the estate.
A-4392-17T1 8 On May 7, 2018, another Chancery Division judge conducted a hearing in
the matter and thereafter entered orders which: denied DeFazio's motion to strike
Davies' and Soden's answers to his verified complaint, and denied DeFazio's
motion to take judicial notice of Soden's previous statements. The judge also
dismissed with prejudice DeFazio's motions to compel an accounting, request a
specific distribution of the estate's assets, permit additional discovery, disqualify
Davies, and appoint a new administrator.
In addition, the judge granted Davies' application for approval of the
proposed accounting, awarded Davies counsel fees, and denied DeFazio's
application for a stay pending appeal. The judge stated that the applications for
relief, except for the request for an accounting, had been previously litigated and
decided by the court. This appeal followed.
On appeal, DeFazio argues that the trial court erred by approving the
accounting without allowing discovery and permitting him to call witnesses. He
contends there are material issues of fact as to whether the monies in the joint
bank account passed to Soden on Ms. Franklin's death.
DeFazio also argues that the trial court erred by not charging the balance
due on Ms. Franklin's home equity loan against Soden's share of the estate. In
addition, he contends he was denied due process because the trial court did not
A-4392-17T1 9 allow him to conduct discovery, refused to take judicial notice of Soden's prior
statements, and failed to strike Davies' and Soden's answers to his complaint.
II.
We first consider DeFazio's contention that the trial court erred by
denying his request for discovery. On appeal, "we accord substantial deference
to the trial court's disposition of a discovery dispute." Brugaletta v. Garcia, 234
N.J. 225, 240 (2018) (citing Capital Health Sys., Inc. v. Horizon Healthcare
Servs., Inc., 230 N.J. 73, 79-80 (2017)). Ordinarily, we will not reverse a trial
court's order on discovery "absent an abuse of discretion or a judge's
misunderstanding or misapplication of the law." Ibid. (quoting Capital Health
Sys., 230 N.J. at 79-80).
Here, the trial court denied DeFazio's motion for discovery. In her
decision of May 7, 2018, the judge found that DeFazio had ample time for
discovery. The judge stated that in the October 17, 2016 order, the court had
established a timetable for discovery with a discovery end date of March 15,
2017, and the court had previously addressed DeFazio's motion to compel
discovery.
The record does not, however, support the court's findings. Although the
trial court did, in fact, afford all parties ample time in which to engage in
A-4392-17T1 10 discovery, the court never addressed DeFazio's motions to compel discovery.
The record shows that in March 2016, DeFazio served interrogatories and a
demand for the production of documents on Soden and her attorney. DeFazio
claims Soden and her attorney did not respond to the discovery requests.
On May 18, 2016, DeFazio filed a motion to compel Soden and her
attorney to comply with the discovery requests. The trial court entered an order
dated October 17, 2016, which stated that DeFazio's motion would be converted
to a case management order. As we have explained, the accompanying order
dated October 17, 2016, extended the time for discovery to March 15, 2017, and
established dates for the completion of various forms of discovery. On
November 16, 2016, DeFazio filed a motion to reinstate his earlier motion to
compel Soden and her attorney to comply with his discovery requests. The trial
court never addressed that motion.
We note that there is some doubt as to whether our court rules allow
DeFazio to demand answers to interrogatories or the production of documents
from Soden's attorney, since he was not a party to the proceeding. See R. 4:17-
1(a) (allowing a party to serve interrogatories on "any other party"); R. 4:18-
1(a) (a party may serve a demand for the production of documents on "any other
A-4392-17T1 11 party"). We also note that Soden's attorney may have had other grounds to
object to DeFazio's discovery request.
In any event, it appears from the record before us that the trial court did
not rule on DeFazio's motion to compel discovery, which was timely filed within
the period allowed for discovery. We therefore remand the matter to the trial
court to address the motion. We express no opinion on whether the motion
should be granted.
III.
We turn to DeFazio's argument that the trial court erred by finding that
the monies in Ms. Franklin's and Soden's joint bank account became Soden's
property upon Ms. Franklin's death. DeFazio contends there were material
issues of fact as to whether Ms. Franklin established the account with Soden for
convenience purposes, and whether she intended to make an inter vivos gift of
the monies in the account to Soden.
We note that factual determinations "made by the trial court sitting in a
non-jury case are subject to a limited and well-established scope of review."
Seidman v. Clifton Sav. Bank, S.L.A., 205 N.J. 150, 169 (2011) (citing In re
Trust Created by Agreement Dated Dec. 20, 1961, ex. rel. Johnson, 194 N.J.
276, 284 (2008)). We will not "disturb the factual findings and legal conclusions
A-4392-17T1 12 of the trial judge unless we are convinced they are so manifestly unsupported by
or inconsistent with the competent, relevant and reasonably credible evidence
as to offend the interests of justice." Ibid. (quoting In re Trust, 194 N.J. at 284).
Here, the judge found that the monies in the joint account passed to Soden
upon Ms. Franklin's death pursuant to N.J.S.A. 17:16I-5(a), which states that
[s]ums remaining on deposit at the death of a party to a joint account belong to the surviving party or parties as against the estate of decedent unless there is clear and convincing evidence of a different intention at the time the account is created.
As we noted in Estate of Ostlund v. Ostlund, 391 N.J. Super. 390, 400
(App. Div. 2007), the statute requires clear and convincing proof that at the time
the account was opened, the decedent did not intend that monies remaining on
deposit at the time of death should pass to the surviving party. We observed
that "[c]lear and convincing evidence 'should produce in the mind of the trier of
fact a firm belief or conviction as to the truth of the allegations sought to be
established.'" Ibid. (quoting In re Purrazzella, 134 N.J. 228, 240 (1993); Aiello
v. Knoll Golf Club, 64 N.J. Super. 156, 162 (App. Div. 1960)).
In Oustland, we also stated that there is an alternative basis for
determining ownership of a joint bank account upon the death of one of the
named parties. Id. at 401. We observed that if the party claiming ownership of
A-4392-17T1 13 the account "can prove by a preponderance of the evidence that the survivor had
a confidential relationship with the donor who established the account, there is
a presumption of undue influence which the survivor donee must rebut by clear
and convincing evidence." Ibid. (citing Petruccio v. Petruccio, 205 N.J. Super.
588, 580-81 (App. Div. 1985); Pascale v. Pascale, 113 N.J. 20, 30-32 (1988); In
re Estate of Penna, 322 N.J. Super. 417, 426 (App. Div. 1999)).
We noted that "the mere existence of family ties does not create . . . a
confidential relationship." Id. at 401-02 (quoting Vezzetti v. Shields, 22 N.J.
Super. 397, 405 (App. Div. 1952)). The test is "whether the relations between
the parties are of such a character of trust and confidence as to render it
reasonably certain that one party occupied a dominant position over the other
and that consequently they did not deal on terms and conditions of equality." Id.
at 402 (quoting Blake v. Brennan, 1 N.J. Super. 446, 454 (Ch. Div. 1948)).
We added that the factors to be considered in determining whether a
confidential relationship existed include "whether [the individuals] are deal ing
on terms of equality, whether one side has superior knowledge of the details and
effect of the proposed transaction based on a fiduciary relationship, whether one
side has exerted over-mastering influence over the other or whether one is weak
A-4392-17T1 14 or dependent." Ibid. We emphasized that the test is "fact-sensitive" and it
"focuses on the equality of the parties with respect to each other." Ibid.
Here, DeFazio claims that at the time the joint account was opened, Ms.
Franklin did not intend that the monies on deposit in the account would become
Soden's property upon Ms. Franklin's death. In his certification dated September
24, 2017, DeFazio stated that Soden had been employed in the banking industry
for many years. He asserted that because Ms. Franklin was ill and his sister had
knowledge of banking, Ms. Franklin relied upon Soden to set up the account
"and did so for convenience to have [Soden] assist her in paying bills among
other things and to have access to the money should something happen to he r."
He claimed the money in the account was his mother's money.
Soden disputed DeFazio's allegations regarding the account. In a letter to
Davies dated October 16, 2017, Soden stated that she and her mother opened the
account "many years ago." Soden said her mother intended that she would have
access to the money in the account "for all purposes," which included
withdrawals to pay bills, purchase food, buy lunch for her children, and pay
herself and her children "for doing things" around her mother's home. In
addition, Soden stated that from February 21, 2014 to July 17, 2015, she had
$90 per week deposited into the account from her earnings.
A-4392-17T1 15 As noted, the judge ruled that the monies in the account passed to Soden
on Ms. Franklin's death pursuant to N.J.S.A. 17:16I-5(a), presumably finding
that DeFazio had not submitted clear and convincing evidence that Ms. Franklin
intended the monies would be part of the estate. The judge did not, however,
address DeFazio's contention that Soden had a confidential relationship with his
mother, which gave rise to a presumption that she exercised undue influence
with regard to the disposition of the account.
In his discovery motion DeFazio apparently is seeking additional
information from Soden regarding the account. If on remand, the judge grants
DeFazio's motion to compel discovery, Soden may provide information that
could have a bearing upon whether the account passed to Soden pursuant to
N.J.S.A. 17:16I-5(a), and whether Soden had a confidential relationship with
her mother and exercised undue influence with regard to the account.
We therefore remand the matter to the trial court for further proceedings
regarding the disposition of the account. On remand, the trial court shall
reconsider its determination that DeFazio failed to establish by clear and
convincing evidence that Ms. Franklin did not intend the monies in the account
would pass to Soden on her death. The court also shall determine if DeFazio
has established that Soden had a confidential relationship with Ms. Franklin, and
A-4392-17T1 16 if so, if Soden has shown by clear and convincing evidence that she did not
exercise undue influence with regard to the joint account.
IV.
DeFazio further argues that the trial court erred by finding that Soden was
not liable for repayment of Ms. Franklin's home equity loan. The record shows
the estate paid $22,569.55, which was the outstanding balance on the loan. As
noted previously, DeFazio contends Davies should have deducted that amount
from Soden's share of the estate.
The loan was discussed in the trial court's hearing of October 3, 2016, on
DeFazio's motion to vacate the settlement allegedly reached during mediation.
At that hearing, Soden stated that her mother wanted Bell to have her car because
Soden had "an equity loan," which she "was paying back." Soden said she had
consulted a lawyer, who purportedly told her she did not have to repay the loan.
Soden also discussed the loan in her letter to Davies dated October 9,
2017. In that letter, Soden stated that in 2013, Ms. Franklin took out the home
equity loan in her name only. According to Soden, Ms. Franklin used the money
she borrowed to pay off "a bill" and to loan Soden money so that she could pay
some of her bills. Soden said she had an oral agreement with her mother to "pay
A-4392-17T1 17 as much as [she] could to help [her mother] out with the monthly payment[s]."
She claimed that after her mother became ill, she "said the loan would be a gift."
DeFazio responded in a letter to Davies dated October 16, 2017. He stated
that Soden previously had acknowledged she had a written agreement with her
mother, which Soden and Ms. Franklin allegedly tore up. DeFazio claimed there
was an agreement, written by his mother, which had been preserved on her
computer. He stated he previously provided a copy of the agreement, which
both parties had signed. He asserted his mother never converted the loan to a
gift, as Soden claimed.
In another letter to Davies, dated October 23, 2017, DeFazio stated the
loan was made on December 4, 2013, as was the date of the written loan
agreement that his mother and Soden had signed. He said the loan was for
$23,916.20, and Soden agreed to pay to Ms. Franklin $325.25 a month for seven
years.
At the May 7, 2018 hearing before the trial court on the exceptions to the
accounting, Soden stated she never signed any paper regarding the loan. She
said that when her mother was preparing her will, she said she wanted to give
Bell her car, but her attorney told her "that's not really even." According to
Soden, her mother said, "Well, there's a loan that I gave Louise some money for,
A-4392-17T1 18 but I'm not letting her pay that, and [I'm] making it even because the amounts
[are] even." Soden stated:
It wasn't something that I had to pay after she died. . . . [W]hen she was living, I tried to give her as much money as I could because it was my debt. But it wasn't something that she said that, "Louise, you have to pay this after I die." It was coming out of her home after the home was sold, and that was it. . . .
In her decision of May 7, 2018, the judge overruled DeFazio's exception
to the accounting and distribution plan. The judge found that the estate had
properly paid the home equity loan and Soden was not obligated to repay the
estate. The judge noted that the only document before the court was the loan
agreement that Ms. Franklin had signed.
After he filed his notice of appeal, DeFazio executed a certification in
support of his appeal in an apparent attempt to supplement the record on appeal.
See R. 2:5-4(a) (record on appeal consists of all papers on file in the trial court).
In his certification, DeFazio reiterated the statements made in letters to Davies.
He also attached a copy of the document, which Soden and his mother
purportedly signed.
The document states that Ms. Franklin had loaned Soden $23,916.20, and
Soden agreed to repay Ms. Franklin $325.25 a month for seven years, beginning
December 5, 2012. The document includes a signature for "Louise Soden" and
A-4392-17T1 19 one for "Geraldine Franklin." This document was never submitted to the trial
court. Moreover, the date on the purported agreement appears to be different
than the date of Ms. Franklin's home equity loan, and the amounts are different.
During the May 7, 2018 hearing, Bell stated that she found an unsigned
document on her mother's computer. She said she did not have the signed
document evidencing Soden's agreement to pay the loan because Soden had
taken all of her mother's papers. Soden told the court she never signed any
papers. It is unclear on this record when DeFazio obtained the copy of the
alleged loan agreement, which was purportedly signed by Soden and his mother.
We are constrained to remand the matter for reconsideration of the trial
court's finding that Soden did not have any obligation to pay Ms. Franklin's
home equity loan. If the court grants DeFazio's discovery motion and Soden
produces additional information regarding the loan, it may have a bearing on the
court's determination. In addition, the court should determine whether it should
consider the loan agreement purportedly signed by Soden and Ms. Franklin,
because it was not previously submitted to the trial court and has not been
authenticated.
The trial court also should determine whether the evidence presents a
genuine issue of material fact as to whether the monies in the joint account
A-4392-17T1 20 belong to Soden, or whether Soden is liable for the home equity loan. The court
should determine whether a plenary hearing is required to resolve any such
disputed issue of fact. The court should afford the parties an opportunity to be
heard and thereafter issue a decision with appropriate findings of fact and
conclusions of law.
We have considered the other arguments raised on appeal and conclude
they are of insufficient merit to warrant discussion in this opinion. R. 2:11-
3(e)(1)(E).
Reversed and remanded to the trial court for further proceedings in
conformity with this opinion. We do not retain jurisdiction.
A-4392-17T1 21