In Re: Estate of: Moskowitz, L. Appeal of: Fein, M ( 2017 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
IN RE: THE ESTATE OF LEONARD J. IN THE SUPERIOR COURT OF
MOSKOWITZ, DECEASED PENNSYLVANIA
APPEAL OF: MICHAEL B. FEIN AND
BERNICE FEIN MOSKOWITZ
No. 354 EDA 2016
Appeal from the Decree September 29, 2015
In the Court of Common Pleas of Delaware County
Orphans' Court at No(s): 0546-2009
BEFORE: PANELLA, J., SHOGAN, J., and RANSOM, J.
MEMORANDUM BY PANELLA, J. FILED JUNE 20, 2017
In this appeal, we address Appellants’, Michael B. Fein and his mother,
Bernice Fein “Moskowitz,”1 (collectively, “the Feins”) latest attempts at
delaying resolution of this estate. After careful review, we affirm.
This case has an extensive history of litigation. We need not catalog
this history to resolve the current appeal and instead refer the interested
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1
In a previous appeal, a panel of this Court observed that “Decedent
[Leonard J. Moskowitz] and [Bernice Fein] were not spouses,
notwithstanding [Michael and Bernice’s] continued reference to [Bernice] as
Decedent’s “wife.”” In re Estate of Moskowitz, 115 A.3d 372, 387 n.16
(Pa. Super. 2015). The name “Moskowitz” used in this decision refers to
Leonard.
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reader to the opinion that resolved one of Appellants’ prior appeals2 in this
matter. See Moskowitz. By way of summary, in 2000, the decedent,
Leonard J. Moskowitz, executed and delivered a power of attorney (“POA”),
appointing Michael as his agent. In 2009, mere weeks before Moskowitz’s
death, Michael used the POA to ratify the transfer of a significant number of
assets out of Moskowitz’s possession and into the possession of Bernice Fein
and himself.
Moskowitz’s will was presented for probate in Delaware County and,
after litigation, the court determined that he was a Pennsylvania resident at
the time of his death. After litigation over the appointment of Bernice as co-
executor of the estate, she renounced her right to act as co-executor in
favor of the appointment of an Administrator de bonis non cum testaments
annex (“Administrator DBN-CTA”), Stephen Carroll, Esquire.
The court granted Attorney Carroll’s request for an accounting of
Michael’s activities as Moskowitz’s agent under the POA. In May 2012,
Michael filed an account that identified multiple transfers of property to his
mother and himself as gifts or transfers for less than adequate
consideration.
Attorney Carroll responded by requesting an injunction against Micheal
and Bernice to preserve the assets that had been transferred from
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2
By our count, this Court has quashed or dismissed at least five prior
appeals in this case on jurisdictional grounds.
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Moskowitz before his death. The court granted the injunctive relief and
enjoined the Feins from dissipating a list of explicitly named assets in their
possession. Shortly thereafter, the court ordered the Feins to account for
these assets, which they did.
In response to this account, the court found that the Feins had failed
to comply with its order, but allowed them further time to come into
compliance. Several months later, the court found that the Feins had willfully
disobeyed the court’s order, and held them jointly liable for approximately
$15,000 in losses suffered by the estate.
Michael submitted another account shortly thereafter. However, in
October 2013, the court granted partial summary judgment to the estate on
its contention that Michael had exceeded the powers granted to him under
the POA when making the transfers to his mother and himself for less than
adequate consideration.
The Feins appealed this decision. A panel of this Court affirmed. See
Moskowitz. Within a matter of months after our decision, the court had
found that the Feins had further dissipated assets subject to the court’s prior
order, and therefore sanctioned them once again.
Over the course of the next year, the court repeatedly directed the
pair to account for the assets that were subject to its prior anti-dissipation
order. In June 2015, the court found them in contempt once again for failing
to adequately account for the assets in issue. Furthermore, the court noted
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that, starting in 2013, over $300,000 had been disbursed from an account
covered by the anti-dissipation order.
The court therefore ordered the Feins to transfer all the assets covered
by the anti-dissipation order into the possession of the estate. Once the
estate was in possession of these assets, Attorney Carroll would be
responsible for submitting an opinion on the ownership of the assets, to
facilitate a separation of those assets that were properly in the possession of
Bernice from those assets that were owned by the estate. Bernice was
explicitly granted an opportunity to dispute Attorney Carroll’s opinion before
any further action would be taken.
Attorney Carroll submitted his opinion, and Bernice did not challenge
it. The court ordered the return of nearly $1,300,000 of assets to the estate,
and again found the Feins in contempt, this time of its order directing the
return of certain assets to the estate. Both the estate and the Feins filed
exceptions to this order.3 The court denied the Feins’ exceptions, but
granted in part the estate’s exceptions. The Feins proceeded to file this
timely appeal.
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3
The Feins’ exceptions were filed in October 2015. Thus, under the Orphans’
Court Rules that were operative at the time, the exceptions acted to toll the
deadline for filing an appeal from the court’s order, regardless of the court’s
failure to explicitly grant reconsideration of its order. Compare former
Pa.O.C.R. 7.1 (repealed 9/1/2016), with Pa.O.C.R. 8.1 (effective 9/1/2016).
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On appeal, they purport to raise three broad issues for our review. Our
standard in reviewing decisions of the orphans’ court is as follows:
The findings of a judge of the orphans’ court division, sitting
without a jury, must be accorded the same weight and effect as
the verdict of a jury, and will not be reversed by an appellate
court in the absence of an abuse of discretion or a lack of
evidentiary support. This rule is particularly applicable to findings
of fact which are predicated upon the credibility of the witnesses,
whom the judge has had the opportunity to hear and observe,
and upon the weight given to their testimony. In reviewing the
orphans’ court’s findings, our task is to ensure that the record is
free from legal error and to determine if the orphans’ court’s
findings are supported by competent and adequate evidence and
are not predicated upon capricious disbelief of competent and
credible evidence.
When the trial court has come to a conclusion through the
exercise of its discretion, the party complaining on appeal has a
heavy burden. It is not sufficient to persuade the appellate court
that it might have reached a different conclusion if, in the first
place, charged with the duty imposed on the court below; it is
necessary to go further and show an abuse of the discretionary
power. An abuse of discretion is not merely an error of
judgment, but if in reaching a conclusion the law is overridden or
misapplied, or the judgment exercised is manifestly
unreasonable, or the result of partiality, prejudice, bias or ill-will,
as shown by the evidence [of] record, discretion is abused. A
conclusion or judgment constitutes an abuse of discretion if it is
so lacking in support as to be clearly erroneous.
We are not constrained to give the same level of deference to
the orphans’ court’s resulting legal conclusions as we are to its
credibility determinations. We will reverse any decree based on
palpably wrong or clearly inapplicable rules of law. Moreover,
we are not bound by the chancellor’s findings of fact if there has
been an abuse of discretion, a capricious disregard of evidence,
or a lack of evidentiary support on the record. If the lack of
evidentiary support is apparent, reviewing tribunals have the
power to draw their own inferences and make their own
deductions from facts and conclusions of law. Nevertheless, we
will not lightly find reversible error and will reverse an orphans’
court decree only if the orphans’ court applied an incorrect rule
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of law or reached its decision on the basis of factual conclusions
unsupported by the record.
In re Paxson Trust I, 893 A.2d 99, 112-113 (Pa. Super. 2006) (citations
and quotation marks omitted).
In their first issue, the Feins contend that the estate’s request for
return of assets transferred by Michael pursuant to the POA is properly
classified as a tort claim for conversion. As such, they continue, the claim is
barred by the applicable statute of limitations.
This argument is specious. The tort of conversion is established when
a defendant has unlawfully interfered with the plaintiff’s rights of ownership
in his property, without the plaintiff’s consent. See McKeeman v.
Corestates Bank, N.A., 751 A.2d 655, 659 n.3 (Pa. Super. 2000). The
estate’s claim was not that the 2000 POA was invalid, or gained through
some form of deception. Thus, the estate was not claiming that Michael had
acted without Moskowitz’s consent. Rather, the estate argued that Michael’s
actions in ratifying the transfers went beyond the legal powers that the POA
had granted him. As a result, the estate’s claim was not based upon an
allegation that he had interfered with Moskowitz’s rights in the property
without Moskowitz’s consent, but rather that he had failed in exercising his
fiduciary duty toward Moskowitz.
Put simply, there was no claim for conversion. Therefore, the Feins’
first argument merits no relief. Their second broad issue, raising various
theories of jurisdictional defects, does not merit much more concern.
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The Feins’ second argument is comprised of six separate challenges to
the jurisdiction of the orphans’ court over this matter. None are serious
challenges.
First, the Feins contend that the orphans’ court did not have subject
matter jurisdiction because the estate’s claim was actually a claim for
conversion and therefore did not sound in equity. We have already
determined that this contention is meritless.
Next, the pair argue that the orphans’ court lacked subject matter
jurisdiction over the estate’s claim as the assets in dispute were not in
Moskowitz’s possession at the time of his death. The Feins contend that,
pursuant to a 1941 Supreme Court of Pennsylvania decision, the orphans’
court is without jurisdiction to determine title to property that was not in
Moskowitz’s possession at the time of his death. See In re Moyer’s Estate,
19 A.2d 467, 469 (Pa. 1941). However, their argument cherry-picks
language from Moyer’s Estate, and fails to acknowledge that the holding:
“[w]hether the [property] was presumuptively within the possession of the
testator was a jurisdictional fact within the power of the [orphans’ court] to
determine.” Id., at 470.
Indeed, where there is a confidential relationship between the donor
and the recipient, the law presumes that the gift was not the product of a
“free, voluntary and intelligent act” of the donor. In re Dzierski’s Estate,
296 A.2d 716, 718 (Pa. 1972). The burden shifts to the recipient to establish
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that the donor intended a gift. See id. Thus, even accepting the Feins’
argument at face value, the orphans’ court had the ability to determine
whether it had subject matter jurisdiction over the estate’s claims, and the
record thoroughly supports that it had such jurisdiction.
Ultimately, however, the Feins’ argument fails for the same reason
that their “conversion” argument failed: it misconstrues the nature of the
action involved. This was not, in form, a dispute over title to the assets at
issue. It was a request for an accounting of the actions taken by Michael
pursuant to the POA. The orphans’ court had mandatory subject matter
jurisdiction over this request. See 20 Pa.C.S.A. § 711(22). Presumably, if
Michael had ever filed a complete and accurate account of his actions as
agent, and such account established that he had fulfilled his fiduciary duties,
no dispute as to the ownership, title, or possession of assets would have
ever arisen.
In light of Michael’s failure to fully and accurately account for his
actions as agent, in addition to the orphans’ court’s conclusion that Michael
had vastly exceeded the powers vested in him by the POA, the court was left
with only one option: imposition of a constructive trust to protect the assets
from dissipation until their ownership could be determined. It was Michael’s
dilatory and obfuscatory behavior which led to these orders. Thus, even
though the orphans’ courts actions may be viewed in isolation as perhaps
unusual, they were the necessary and appropriate actions when viewed in
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context. The Feins’ contention that the orphans’ court lacked subject matter
jurisdiction is therefore completely meritless.
Next, the Feins argue that the orphans’ court lacked jurisdiction to
order Bernice to return property to the estate, as she was not an agent.
Once again, this argument is specious.
This litigation arises from Michael’s at best half-hearted attempts to
account for his actions as Moskowitz’s agent. In his several accounts,
Michael identified multiple gifts to his mother, Bernice. The orphans’ court
determined that Michael’s gifts to his mother exceed the powers granted to
him by the POA. Under the Probates, Estates, and Fiduciaries Code, the
orphans’ court had the equitable power to order Bernice to return to the
estate the assets that her son had improperly gifted her. See 20 Pa.C.S.A. §
5601.2(e). Thus, once again, this argument is utterly meritless, as it
mischaracterizes the nature of the proceedings.
Next, the Feins argue that the orphans’ court had no jurisdiction over
Michael’s actions as agent, as he was acting pursuant to a POA executed and
controlled by New Jersey law. They provide no authority for this assertion,
and for that reason, the claim is waived. See Branch Banking and Trust
v. Gesiorski, 904 A.2d 939, 942-943 (Pa. Super. 2006) (“When issues are
not properly raised and developed in briefs, when the briefs are wholly
inadequate to present specific issues for review[,] a Court will not consider
the merits thereof.”)
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In their fifth challenge to the jurisdiction of the orphans’ court, the
Feins continue in their dilatory attempt to redefine the procedural posture of
the case in the orphans court. Despite acknowledging that “the [o]rphans’
[c]ourt did not articulate intentional interference with an inheritance as the
basis of its award[,]” Appellant’s Brief, at 31, they nonetheless characterize
the estate’s claim as one for intentional interference with an inheritance.
After setting up this straw man, the Feins then demonstrate that the facts of
this matter do not qualify for relief under this tort. As we have already
exhaustively detailed, the estate’s claims, and the orphans’ court’s orders,
all fall under the traditional powers of the orphans’ court for administration
of estates and supervision of agents acting under a POA. Their challenge on
this basis is wholly devoid of merit.
In their sixth and final challenge to the orphans’ court’s jurisdiction,
they argue that the orphans’ court’s order directing the return of certain
property in the City of Philadelphia to the estate was barred by the doctrine
of res judicata. As with the Feins’ other jurisdictional challenges, this
argument is frivolous.
The doctrine of res judicata holds that “[a] final judgment upon the
merits by a court of competent jurisdiction bars any future suit. . . .” Mintz
v. Carlton House Partners, Ltd., 595 A.2d 1240, 1245 (Pa. 1991)
(quoting Stevenson v. Silverman, 208 A.2d 786, 788 (Pa. 1965)). It bars
the future litigation of issues raised and, in addition, arguments which might
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be raised in the future suit. See Neotzel v. Glasgow, Inc., 487 A.2d 1372,
1376 (Pa. Super. 1985). The doctrine is designed to conserve limited judicial
resources, establish certainty in judgments, and protect the party relying
upon the judgment from vexatious litigation. See Yamulla Trucking &
Excavating Co., Inc. v. Justofin, 771 A.2d 782, 784 (Pa. Super. 2001).
Furthermore, the parties to the subsequent action must be identical to, or in
privity with, the parties to the prior action. See Kelly v. Kelly, 887 A.2d
788, 791 (Pa. Super. 2005).
The record establishes that Joseph Fine, who identified himself as the
residuary beneficiary of Moskowitz’s will, filed suit against Bernice seeking to
void the gift of a property from Moskowitz to Bernice. However, the Feins
concede that “Due to [Joseph Fine’s] decision not to have … a personal
representative [of the estate of Moskowitz] appointed, Joseph Fine’s action
was dismissed with prejudice by the First Judicial District.” Thus, the Feins
concede not only that the estate was not a party to the previous litigation,
but also that there was no final judgment on the merits of the matter. See
Brown v. Cooney, 442 A.2d 324, 326 (Pa. Super. 1982) (“A judgment for
the defendant is not on the merits where it is based merely on rules of
procedure rather than on rules of substantive law.”) According to the Feins,
Joseph Fine’s action was dismissed on procedural grounds, as he was an
improper plaintiff. Thus, the Feins admit that they cannot establish that the
judgment was on the merits or that the estate was in privity with a party to
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the prior litigation. As such, the Feins’ final challenge to the orphans’ court’s
jurisdiction is meritless.
In their third and final broad issue raised on appeal, the Feins finally
acknowledge the obvious nature of the proceedings in the orphans’ court.
They raise four separate challenges to the orphans’ court’s rulings on
Michael’s attempts at providing an account of his actions as an agent for
Moskowitz. Perhaps unsurprisingly, we conclude that none of these
arguments has any merit.
The Feins first argue that the orphans’ court misconstrued the order it
entered on August 8, 2012. In particular, they argue that the order did not
prohibit them from dissipating the value of an account below $532,493.08,
which is the value they believed the estate was entitled to. The order
provided, in relevant part:
(1) Respondents Bernice Fein and Michael B. Fein,
Esquire, individually and as agent for Bernice Fein are
ENJOINED from directly or indirectly transferring,
disbursing or otherwise disposing of or dissipating any of
the assets presently or formerly contained in the following
accounts that were the assets of Leonard J. Moskowitz and
any proceeds therefrom:
[listing six accounts, including the relevant account]
(2) Respondents, Michael B. Fein, Esquire, individually
and as agent for Bernice Fein, and Bernice Fein are
ENJOINED from entering into any agreement to sell the
real property or transferring the real property located [in
Philadelphia] without gaining the prior written approval of
[the estate.]
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(3) In the event that the property located [in
Philadelphia] is sold, the respondents, Michael B. Fein,
Esquire individually and as agent for Bernice Fein, and
Bernice Fein are ENJOINED from transferring, disbursing
or otherwise disposing of, or dissipating the proceeds from
said sale. The proceeds from said sale are to be placed in
an interest bearing or dividend paying account and no
withdrawals shall be permitted from same without prior
court approval.
…
(5) All assets noted herein appearing in paragraphs 1, 2
and 3 of this DECREE, which are held by Bernice Fein or
are held by transferees from Bernice Fein are held in
constructive trust for the benefit of the Estate of Leonard
J. Moskowitz, deceased or further [o]rder of this [c]ourt.
Decree, 8/8/12, at 3-5.
The Feins do not argue that this order was ambiguous or unclear.
Rather, they make the somewhat stunning assertion that the orphans’ court
did not know what it intended its own decree to mean. Our review of the
decree leads us to conclude that the orphans’ court’s interpretation is the
only reasonable one. The decree does not contain any exceptions or
limitations to the prohibition on “directly or indirectly transferring, disbursing
or otherwise disposing of or dissipating any of the assets[.]” Thus, the
decree did not permit the Feins to dissipate, in any manner, any of the
assets in the account. The Feins’ contention to the contrary is completely
meritless.
Next, the Feins argue that the estate is not entitled to any appreciation
of the assets held in the account; rather, they contend that the estate is
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entitled only to the value of those assets as of the date of Moskowitz’s
death. Once again, the Feins provide no authority for their argument, and it
is therefore waived. See Gesiorski. In any event, we can find no abuse of
the orphans’ court’s discretion in its determination that the Feins should not
benefit from their actions in depriving the estate of its assets during this
protracted litigation. The Feins’ argument is patently frivolous.
Next, the Feins argue that the orphans’ court had no power to require
Michael Fein to account for actions taken with the estate’s property after the
death of Moskowitz. Again, the Feins provide no authority for this argument,
and it is waived. See Gesiorski. In any event, it is an irrational argument.
Obviously, an orphans’ court must have the power to require a continuing
account of assets that are the subject of litigation before it. Otherwise,
defendants would be incentivized to hide the assets through a series of
financial transactions, referred to in other circumstances as “money
laundering,” to frustrate the identification and return of such assets. Clearly,
there is no relief to be had with this argument.
Finally, in their last argument, the Feins contend that the orphans’
court abused its discretion in awarding attorney fees to the estate in this
matter. The Feins’ single paragraph of argument in support of this issue
contains no citation to authority. This issue is thus waived. See Gesiorski.
Even if we were to reach this issue, we would note that the award of such
fees is amply supported by the record of dilatory behavior on the part of the
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Feins in this matter. As this memorandum makes clear, we believe that this
appeal is, itself, a continuation of such dilatory behavior. The orphans’
court’s decision is more than reasonable in light of the record before us.
Decree affirmed. Jurisdiction relinquished.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 6/20/2017
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