Keller, R. v. Miller, R. ( 2015 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
RICHARD KELLER, ET AL, IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellant
v.
RALPH MILLER, ET AL,
Appellee No. 2057 MDA 2014
Appeal from the Order Entered November 5, 2014
In the Court of Common Pleas of Lebanon County
Civil Division at No(s): 2009-02124
BEFORE: BOWES, JENKINS, AND PLATT,* JJ.
MEMORANDUM BY BOWES, J.: FILED DECEMBER 01, 2015
Richard, Randy, and Edwin Keller (“the Kellers”), the sons of the
decedent, Mary Keller, commenced this action against their cousin Deborah
Miller and her husband Ralph (“the Millers”), seeking to recover the proceeds
of the sale of their mother’s former home on Kathleen Street. They
maintained that their mother told them on a number of occasions that,
although she transferred the house to Deborah, she instructed Deborah that,
if the house was sold, the proceeds were to be divided equally among the
Kellers. The Kellers alleged that Deborah sold the home, converted the sales
proceeds, and fraudulently transferred them to herself and her husband.
They sought an accounting and a constructive trust of the proceeds from the
sale. The trial court entered summary judgment in favor of Deborah, after
*
Retired Senior Judge assigned to the Superior Court.
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concluding that the testimony upon which the Kellers based their claim to
the proceeds of the house was inadmissible hearsay and barred by the
statute of frauds. We affirm.
The record reveals that Deborah was Mary’s attorney-in-fact pursuant
to a power of attorney executed in 1990. She was also the designated
executrix under Mary’s 1997 will. During the 1990s, Mary Keller and her
husband, John, owned the Kathleen Street property. John died in 2001 and
Mary subsequently conveyed the property to Deborah on October 28, 2003.
Two months later, Mary executed a codicil to her 1997 will in which she
devised the Kathleen Street property to Deborah and noted therein that the
real estate was already deeded to her. She bequeathed the remainder of
her estate to her three sons in equal shares.
On September 11, 2007, Deborah sold the Kathleen Street property
for $121,500. The proceeds were placed in a joint account with her
husband. Mary died on June 9, 2009. The Kellers filed the within complaint
on November 11, 2009, in which they sought to recover the proceeds of the
sale of their mother’s former home, based on certain statements Mary
allegedly made to them. They averred that Mary told them that she
instructed Deborah to divide the proceeds from any sale of the Kathleen
Street property among them.
The court granted the Kellers’ demand for an accounting pursuant to
35 Pa.C.S. § 3501.1, which was based on allegations that Deborah had
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misused Mary’s funds while acting as her attorney-in-fact for the two and
one-half years prior to Mary’s death. However, the Kellers abandoned their
claims that Deborah had misappropriated Mary’s funds prior to trial.
On October 14, 2014, the date of the pre-trial conference, the Millers
filed a motion for summary judgment in which they alleged inter alia,1 that
the Kellers could not introduce the statements allegedly made by Mary due
to the Dead Man’s Act, the statute of frauds, the rules against hearsay, and
the parol evidence rule. Without such evidence, they could not recover. The
Kellers responded with a motion in limine seeking an evidentiary ruling on
the admissibility of Mary’s out-of-court statement that she instructed
Deborah to divide the proceeds from the sale of the Kathleen Street property
among the Kellers.
The trial court concluded that the Dead Man’s Act and the parol
evidence rule did not operate to preclude admission of Mary’s purported
statements, but that the statements were inadmissible hearsay and
precluded by the statute of frauds. The court concluded that, absent such
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1
Deborah also alleged that the accounting had revealed no irregularities in
her expenditures and that the misappropriation issue had been abandoned.
In addition, the Kellers’ allegations that Mary’s transfer of the house was due
to Deborah’s undue influence required expert medical testimony establishing
Mary’s diminished capacity. The Kellers acknowledged that they did not
intend to introduce such testimony. Deborah maintained that the Kellers
could not prove any theory of recovery at trial.
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evidence, the Kellers could not prevail and summary judgment was granted.
This appeal followed. The Kellers present two issues for our review:
1. Was the trial court correct in ruling that the statements of a
now-deceased mother to her three sons (Appellants here),
telling those sons that the mother conveyed a specific parcel
of real estate to her niece (one of the Appellees here) with
the expressed instruction that the niece give to the sons the
proceeds of sale when the niece sold the property were
inadmissible hearsay because they would have been offered
to show that the mother actually made the instruction to the
niece (the ultimate issue in the case), or alternatively, would
have been admissible as an exception to the hearsay rule in
that the statements showed the now-deceased mother’s then-
existing state of mind?
2. Was the trial court correct in ruling that the same evidence
described in the previous Question Presented was barred by
the Statute of Frauds when the statements did not and do not
purport to create an interest in real estate for any of the
Appellants, but instead imposed requirements on Appellee
Deborah Miller with respect to funds, such requirements by
definition only applying if and when Appellee would (and did)
surrender her own interest in a certain parcel of real estate?
Appellants’ brief at 3.
Summary judgment is proper where there is no genuine issue of
material fact and the moving party is entitled to relief as a matter of law.
Pa.R.C.P. 1035.2. Where, as here, the non-moving party bears the burden
of proof, “he may not merely rely on his pleadings or answers in order to
survive summary judgment.” Murphy v. Duquesne Univ. of the Holy
Ghost, 777 A.2d 418, 429 (Pa. 2001). Unless a non-moving party
“adduce[s] sufficient evidence on an issue essential to its case and on which
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it bears the burden of proof,” the moving party is entitled to judgment as a
matter of law. Young v. PennDOT, 744 A.2d 1276, 1277 (Pa. 2000).
In reviewing the trial court’s grant of summary judgment, we may
disturb the order of the trial court only where it is established that the court
committed an error of law or abused its discretion. Capek v. Devito, 767
A.2d 1047, 1048, n.1 (Pa. 2001). As with all questions of law, our review is
plenary. Phillips v. A-Best Products Co., 665 A.2d 1167, 1170 (Pa.
1995). In making our determination, we view the record in the light most
favorable to the non-moving party, and all doubts as to the existence of a
genuine issue of material fact must be resolved against the moving party.
Murphy, supra at 429.
Herein, an evidentiary ruling culminated in the grant of summary
judgment. “It is well settled that the admission or exclusion of evidence is a
matter within the sound discretion of the trial court, which may only be
reversed upon a showing of a manifest abuse of discretion.” Eichman v.
McKeon, 824 A.2d 305, 319 (Pa.Super. 2003). “[A]n abuse of discretion
may not be found merely because an appellate court might have reached a
different conclusion, but requires a result of manifest unreasonableness, or
partiality, prejudice, bias, or ill-will, or such lack of support so as to be
clearly erroneous." Betz v. Pneumo Abex LLC, 44 A.3d 27 (Pa. 2012)
(quoting Paden v. Baker Concrete Constr., 658 A.2d 341, 343 (Pa.
1995)).
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Preliminarily, we note that the Kellers seek to recover the proceeds
from the sale of the Kathleen Street property owned by Deborah based on
Mary’s alleged oral direction that Deborah split the proceeds among them.
Yet, they have not pled an oral agreement between Mary and Deborah, or a
breach of such an agreement. Moreover, they insist that they are not
seeking to enforce an oral contract. In addition, the Kellers abandoned their
claim that Deborah unduly influenced their mother, which was the basis for
imposition of a constructive trust.2
The Kellers bore the burden of proving that their mother conveyed the
Kathleen Street property to Deborah with the condition that, upon its sale,
she pay the proceeds to them in equal shares. There is no writing evidencing
that proviso. The deed conveyed the property to Deborah in fee simple, and
the Kellers stipulated that the deed was duly executed and valid. In her
2003 codicil to the 1997 will, Mary acknowledged that the Kathleen Street
property had been deeded to Deborah, bequeathed her personal property to
Deborah, but directed Deborah to permit each of her sons to choose some
personal property prior to its sale. The codicil did not reference or confirm
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2
Although the Kellers originally pled that Deborah exerted undue influence
over Mary and “was thereby able to induce Mary A. Keller to divert Mary A.
Keller’s assets to her and away from her sons, who were the natural objects
of her bounty[,]” they abandoned any claim of undue influence prior to trial.
Complaint, ¶ 29, at 6.
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any prior instruction to Deborah to convey the proceeds from a subsequent
sale of the house to the sons.
In their pre-trial statement, the Kellers represented that “most if not
all of our witnesses will be testifying to statements of intent of Mary Keller
while she was living.” Plaintiffs’ Pre-Trial Statement, 8/14/14, at 4. It was
undisputed that Mary conveyed the Kathleen Street property to Deborah in
fee simple. Nonetheless, the Kellers would testify that their mother told
them that she directed Deborah to transfer the proceeds from any sale of
the house to them. Adamant that that they were not proceeding on a
contract theory, the Kellers alleged that Deborah failed to obey Mary’s
directive to transfer the sale proceeds to the sons. Id. at ¶ 30.
The Kellers argue first that their mother’s statements to them are not
hearsay because they offered them not to prove the truth of the matter
asserted but only to show that Mary gave the instruction to Deborah Miller,
“the central fact at issue in the present case.” Appellant’s brief at 15. The
Kellers rely upon American Future Systems, Inc. v. Better Business
Bureau of Eastern Pennsylvania, 872 A.2d 1202 (Pa.Super. 2005), where
out-of-court customer complaints were held not to be hearsay because they
were offered to prove that complaints were made, not that the complaints
were credible. Herein, the trial court rejected this argument, finding that the
statement itself was not an instruction but was being offered to prove the
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truth of the matter asserted: that Mary gave a specific instruction to
Deborah.
We agree with the trial court. Pa.R.E. 801(c) defines hearsay as “a
statement that (1) the declarant does not make while testifying at the
current trial or hearing; and (2) a party offers in evidence to prove the truth
of the matter asserted in the statement.” The official comments to Pa.R.E.
801 explain that questions, exclamations, offers, instructions, warnings, and
other non-assertive communications are not hearsay. A statement is
hearsay only if offered to prove the truth of the matter asserted in the
statement. The comments further explain that sometimes statements are
legally significant regardless of whether they are true or false, such as a
statement constituting an offer, acceptance, or notice. Such statements are
not hearsay when simply offered to prove that they were made.
The statement herein was not an instruction. The Kellers offered
Mary’s out-of-court statement to prove that she gave an instruction to
Deborah, which was the matter asserted in the statement. Thus, it was
offered for the truth of the matter asserted and constitutes inadmissible
hearsay.
Alternatively, the Kellers maintain that their mother’s statement falls
within the hearsay exception for the declarant’s state of mind under Pa.R.E.
803(3), which provides:
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(3) Then-Existing Mental, Emotional, or Physical Condition. A
statement of the declarant's then-existing state of mind (such as
motive, intent or plan) or emotional, sensory, or physical
condition (such as mental feeling, pain, or bodily health), but not
including a statement of memory or belief to prove the fact
remembered or believed unless it relates to the validity or terms
of the declarant's will.
As this Court held in Schmalz v. Mfrs. & Traders Trust Co., 67 A.3d
800, 802 (Pa.Super. 2013), the state of mind exception is ordinarily
applicable in three circumstances. It may be used to prove the declarant's
state of mind when that state of mind is an issue directly related to a claim
or defense in the case. The exception has also been invoked to
circumstantially prove that a declarant, after making the statement, acted in
conformity with his or her statement. See Commonwealth v. Riggins,
386 A.2d 520, 526 (Pa. 1978) (victim’s sister permitted to testify that victim
stated to her on the evening of the killing, after a phone call, that defendant
was expected to visit the home later that evening to show willingness of
victim to admit him and opportunity for the defendant to commit the
murder). Finally, an out of court statement related to the person's memory
or belief is admissible in the limited instance where it relates to the
"execution, revocation, identification or terms of the declarant's will."
Pa.R.E. 803(3).
We held in Commonwealth v. Begley, 780 A.2d 605, 623 (Pa.
2001), that “the determination of whether out-of-court statements are
admissible under the state of mind exception to the hearsay rule is within
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the sound discretion of the trial court and will be reversed only upon an
abuse of that discretion.” Therein, the trial court ruled that the victim’s
brother could testify that his sister told him in casual conversation that she
was going to get a job from the defendant for $15 an hour guarding a
female victim/witness in a safe house. The court reasoned that the
testimony was admissible under the state of mind exception to the hearsay
rule as circumstantial evidence that, shortly before her disappearance, the
victim intended to accept that job, and she subsequently acted in
accordance with her stated intent. Additionally, the trial court specifically
instructed the jury that it could only consider the testimony to establish the
victim’s intent at the time of the conversation. N.T., 7/16/96, at 555. In
affirming, the Supreme Court reiterated the rationale for the state of mind
exception:
Intention, viewed as a state of mind, is a fact, and the
commonest way for such a fact to evince itself is through spoken
or written declarations. It is therefore because of the
impossibility, in many cases, of proving intention apart from
personal declarations, that they are admitted. The true basis of
their admission, then, is necessity, because of which an
exception to the hearsay rule is recognized. . . .
Commonwealth v. Marshall, 287 Pa. 512, 522, 135 A. 301,
304 (1926).
Begley, supra at 624.
The Kellers contend that the proffered statement is a declaration of
their mother’s intent and plan. We disagree. The statement does not
describe Mary’s future intent but relates to past events. The Kathleen Street
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property had already been deeded to Deborah and any alleged instruction
would have been given prior to that conveyance. While an out-of-court
statement is admissible to prove that the declarant subsequently acted in
conformity with that statement, the Kellers impermissibly proffer it to prove
the truth of past events. See Commonwealth v. Levanduski, 907 A.2d 3(Pa.Super. 2006) (en banc) (a statement relating to past events based on
memory or belief is not admissible under Pa.R.E. 803(3) to establish the
truth of those events, absent relation to the execution, revocation,
identification, or terms of the declarant's will).
We agree with the trial court that the state of mind exception to the
hearsay rule is inapplicable on the facts herein. We find the Kellers’
allusions to their mother’s state of mind were being "used as a conduit to
support the admission of fact-bound evidence to be used for a substantive
purpose." Schmalz, supra (quoting Commonwealth v. Moore, 937 A.2d
1062, 1073 n.6 (Pa. 2007)). Having correctly concluded that Mary’s alleged
oral statement was inadmissible hearsay, the trial court properly found that
without it, the Kellers could not prove their claim and granted summary
judgment. Thus, we need not reach the issue as to whether the statute of
frauds also operated to bar such evidence.
Order affirmed.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 12/1/2015
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