Trust Under Deed of Ott, W., Appeal of: PNC Bank ( 2021 )

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2021 PA Super 203TRUST UNDER DEED OF WALLACE F. : IN THE SUPERIOR COURT OF
OTT : PENNSYLVANIA
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APPEAL OF: PNC BANK, N.A. :
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: No. 1591 EDA 2020
Appeal from the Decree Entered July 20, 2020
In the Court of Common Pleas of Philadelphia County Orphans’ Court at
No(s): No. 1251 IV of 1963
BEFORE: BENDER, P.J.E., DUBOW, J., and STEVENS, P.J.E.*
OPINION BY DUBOW, J.: FILED OCTOBER 12, 2021
PNC Bank, N.A. (“Accountant” or “PNC”), appeals from the Order
overruling in part and sustaining in part the objections filed by co-
trustees/beneficiaries Robert W. Prigge, Jr., and James E. Shryock
(“Objectors”) to the Third Account of the Wallace Ott Inter Vivos Trust
(“Trust”). PNC challenges the orphans’ court’s limiting of PNC’s trust
administration fee to five percent of income and its granting a one-time
principal fee of $145,000 as compensation for services rendered during the
third accounting period covering November 8, 2004, to May 15, 2017. PNC
also challenges the orphans’ court’s denial of its request for the Trust to pay
its attorney’s fees. After careful review, we affirm.
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* Former Justice specially assigned to the Superior Court.
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We glean the following relevant facts from the orphans’ court’s July 20,
2020 Adjudication and the reproduced record. On June 10, 1954, Wallace Ott
(“Settlor”) executed a Deed of Trust for the benefit of his four grandchildren
and their issue, appointing Tradesmens Land Title Bank and Trust Company
(“Tradesmens”) as trust administrator. Settlor appointed Tradesmens and
himself as co-trustees. The Trust instrument does not contain any provisions
addressing trustee compensation. However, also on June 10, 1954,
Tradesmens’ assistant vice president, who had signed the Trust instrument on
behalf of Tradesmens, sent a letter addressed to Settlor (“the 1954 Letter”)
containing the following paragraph regarding its fee for administering the
Trust:
This letter is to advise you that our fee for administering the trust
which you established yesterday for the benefit of your
grandchildren will be the same as that which we are currently
charging in Mrs. Ott’s Deed of Trust and in your personal Deed of
Trust; namely [5%] of income collected.
Letter from Sidney B. Dexter to Settlor, dated June 10, 1954.
First Account
Settlor died on July 18, 1962. To discharge Settlor’s estate, Provident
Tradesmens Bank and Trust Company (“Provident”), Trademens’ successor in
interest, filed a First Account covering the period of July 10, 1954, to April 4,
1963. No one objected, and the court confirmed the First Account on
December 27, 1963. Throughout the first accounting period, the Trust had
paid Provident an administrative fee of five percent of the Trust’s income (“five
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percent income commission”) pursuant to the 1954 Letter. The court also
confirmed the appointment of Richard W. Shryock and John S. Prigge, Jr., as
co-trustees, as provided in the Trust instrument, along with Provident.
Second Account
Richard Shryock died in May 2003, and on May 25, 2005, PNC,
Provident’s successor in interest, filed a Second Account covering the period
from September 10, 1971, to November 8, 2004. PNC requested an interim
principal commission of 2.8% for this second accounting period when the fair
market value of the Trust was approximately $1.9 million. No one objected,
and the court confirmed the Second Account, granted the requested principal
commission, and confirmed the appointment of Objector Jamie Shryock to
succeed Richard Shryock as co-trustee. Again, the Trust paid PNC a five
percent income fee pursuant to the 1954 Letter throughout the second
accounting period.
Third Account
John Prigge, Jr. died on May 15, 2017, and a majority of the income
beneficiaries appointed Objector Robert Prigge, Jr., to replace him as co-
trustee. Intending to discharge John Prigge’s estate, PNC prepared a Third
Account covering the period from November 8, 2004, to May 15, 2017. By
email dated August 21, 2018, PNC informed Objector Jamie Shryock that the
Third Account was nearly finished and that it intended to seek a one-time
principal fee of $145,000 as a “gesture of good faith,” a figure PNC believed
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was “reasonable under the circumstances.” Email from PNC’s Mikal Payne,
dated 8/21/18, RR at 810a-811a. See also N.T., 11/5/19, at 77-78
(Testimony of Mikel Payne, Vice President and Trust Officer of PNC). In an
email dated August 29, 2018, Mr. Payne informed Jamie Shryock that “[t]he
trust is currently being charged 5% of collected income; whereas, other
irrevocable trusts we administer are charged according to our published fee
schedule beginning at 1.4% on the first $2,000,000 and 1% on the next
$3,000,000.” Email from Payne, dated 8/29/18, RR 814a. During the third
accounting period, PNC once again collected a five percent income commission
pursuant to the 1954 Letter, totaling approximately $48,000.00.1
On October 10, 2018, PNC informed all of the beneficiaries about its
intent to collect an “interim principal fee” by sending a letter informing them
that it would be requesting such approval from the court. RR. 816a-817a. In
that letter, PNC requested that the beneficiaries “consent” to a “a one-time
principal fee of $142,751.63,” which it explained was one-half of what PNC
would have earned if they had charged fees beginning in 2007 in accordance
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1 The Third Account stated the Trust had a fair market value of $2,615,100.27,
and a combined balance of $1,250,716.36, with the assets held in bonds,
common stocks, and mutual funds. Between the Second and Third Accounts,
the fair market value of the Trust increased over $600,000 from approximately
$1.9 million to approximately $2.6 million. Beneficiaries received distributions
from Trust income of approximately $944,388 over the thirteen-year third
accounting period, compared to $102,320 distributed over the thirty-three-
year second accounting period. Adjudication, 7/20/20, at 29-30; see also
Third Account, RR 119a-192a.
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with its tiered fee schedule. Id. The letter concluded that PNC would seek
the court’s approval for the full amount in accordance with their published fee
schedule, i.e., $285,503.25, if the beneficiaries did not “consent” to its
suggested interim principal fee. Id.On April 2, 2019, PNC filed its Petition for Adjudication, seeking approval
of the Trust’s Third Account, and requesting fees of $69,464.36 as income
commission and $216,038.89 as principal commission, an aggregate of
$285,503.25.2 See Rider annexed to Third Account, at ¶(4)(2).3 PNC also
sought attorney’s fees of $13,270.93 representing those incurred through
March 31, 2019, and a reserve of $7,500 for counsel fees and expenses
incurred in connection with the preparation and filing of the Third Account.
On May 3, 2019, Objectors filed Objections to the Third Account, later
amended with permission, asserting that (1) the additional compensation
sought by PNC was excessive and unreasonable; (2) Section 7768 of the
Uniform Trust Act, 20 Pa.C.S. § 7768, if applicable, did not require rote
application of a trustee’s published standard fee schedule; and (3) the
requested attorney’s fees are improper as PNC should use corporate funds,
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2 PNC’s requested principal commission of approximately $216,039 would be
approximately 12.9% of the principal’s adjusted balance of approximately
$1,670,968, or 8.25% of the trust’s fair market value of $2,615,100. See
Third Account, RR 120a.
3 PNC subsequently corrected the aggregate amount it sought to
approximately $265,000. See N.T at 39.
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not Trust funds, to pay for its defense of its Third Account.4 PNC responded
that pursuant to Section 7768(a) of the Uniform Trust Act, its request for
interim compensation and attorney’s fees was reasonable.
The court began a non-jury trial on November 5, 2019, at which
Objectors first presented testimony as on cross from the PNC fiduciary advisor
in charge of the Trust, Mikal L. Payne, CFP. Mr. Payne testified, inter alia, that
the management of the Trust required no special attention. N.T., 11/5/19, at
25. In addition, the court admitted an emailed letter from Mr. Payne to
Objector Jamie Shryock, indicating it would seek court approval for a “one-
time principal fee of $145,000 . . . as compensation for fiduciary services
rendered during the accounting period.” See Email message from Mikal L.
Payne to Jamie Shryock, dated 8/21/18, at 2, RR at 810a-811a. Objectors
also presented evidence that PNC and its predecessors in interest had only
ever charged the Trust a five percent income commission. Objector Shryock
testified that PNC never approached him during the third accounting period to
discuss either its fee schedule or additional compensation. He stated he was,
thus, “dumbfounded” by PNC’s request for increased income commission.
Adjudication at 7, citing N.T. at 95.
The trial continued on February 11, 2020, after the Objectors had filed
amended objections. PNC presented direct testimony from Mr. Payne, who
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4 Because the Trust has two contingent remainder beneficiaries, the Office of
the Pennsylvania Attorney General joined the objections.
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“reaffirmed his belief in the reasonableness of the $145,000 principal
commission.” Adjudication at 9, citing N.T., 2/11/2020, at 7-8. Mr. Payne
stated that the “offer” of $145,000 as an interim principal commission was
reasonable because it would “avoid the time and hassle of litigating these
things, and [ ] get to that result more expeditiously[.]” Id. at 10, citing N.T.,
2/11/20, at 25. Linda Manfredonia, a fiduciary consultant once employed by
PNC, testified regarding her historical and legal knowledge of trust creation
and administration. See N.T. 2/11/20, at 54-105.
On July 20, 2020, the trial court entered an Adjudication, finding PNC is
entitled to five percent income commission pursuant to the fee agreement set
forth in the 1954 Tradesmens Letter to Settlor. The court also found that a
one-time principal commission of $145,000 is reasonable compensation for
PNC’s administrative services during the third accounting period. The court
further concluded that PNC’s attorney’s fees and costs associated with its
defense of the Third Account are not reimbursable out of trust funds, although
PNC’s attorney’s fees and costs incurred during the third accounting period,
including the preparation and filing of the Third Account, are proper expenses
to be reimbursed from trust funds.5
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5 In a footnote, the court acknowledged that the Objectors had filed a separate
petition asking the court to order Accountant to honor a decision of the
majority of the trustees that the Trust pay Objectors’ attorney’s fees. In light
of its adjudication, the orphans’ court suggested that the parties resolve the
issue of Objectors’ attorney’s fees raised in that petition amicably to avoid
another time-consuming hearing. See Adjudication at 41 n.20.
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PNC timely appealed and filed a court-ordered Pa.R.A.P. 1925(b)
Statement. In response, the trial court filed a “Final Decree” indicating that
its July 20, 2020 Adjudication fully addressed the issues raised in PNC’s Rule
1925(b) Statement.
PNC presents the following Statement of Questions Involved for this
Court’s review, reordered:
1. By statute, a fee agreement, signed by [S]ettlor or his
authorized designee identified in the trust, can establish the
fees to be paid to a trustee. A 1954 letter, written by PNC’s
predecessor informed [S]ettlor of the bank’s then-current
standard income commissions. Did the trial court err in
characterizing the letter as a contract between [S]ettlor and
the bank and by concluding that the bank officer signed the
letter as settlor’s statutory designee?
2. Did the trial court err by (a) ignoring the statutory presumption
that PNC’s fee request in accord with its standard rates was
reasonable and by (b) placing the burden on PNC to prove by
“clear and convincing” evidence that the 1954 standard five
percent income commission was unreasonable or that PNC’s
duties were not substantially different from those of its
predecessor when the trust was created in 1954?
3. PNC’s fee request was premised on its standard rates as
applied to the fair market value of the principal of the trust.
Did the trial court err by characterizing the request, in part, as
an additional income commission?
4. Prior to filing the account, in an effort to avoid litigation,
payment delay and to engender good will with the
beneficiaries, PNC offered a substantial discount from its
scheduled rates if the co-trustees and the beneficiaries agreed
on a compromised amount. Did the trial court err in finding
that the lesser amount of the contingent offer of compromise
constituted compelling evidence that PNC’s scheduled rates
were unreasonable?
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5. The trial court denied PNC recovery of its counsel fees
expended in defending its statutory-based fee request on what
it characterized as PNC’s “imprudent conduct” in “blindsiding”
Objectors when it requested its full fees permitted by statute.
Did the trial court err in denying PNC an award of its attorneys’
fees when the uncontested record evidence demonstrates that
PNC informed Objectors in writing that it would seek Court
approval to charge the full amount of its fees based on its
standard rates if its offer was rejected?
6. Objectors rejected PNC’s compromise offer, instead filing and
prosecuting objections. Did the trial court err in finding that
Objectors’ counsel fees should be paid from the trust when
Objectors’ litigation strategy ultimately provided no additional
benefit to the trust, resulting instead in a substantial loss to
the trust corpus?6
Appellant’s Br. at 8-10 (suggested answers omitted).
Standard and Scope of Review
When reviewing an order entered by the orphans’ court, the “decision
will not be reversed unless there has been an abuse of discretion or a
fundamental error in applying the correct principles of law.” In re Estate of
Krasinski, 188 A.3d 461, 466 (Pa. Super. 2018) (en banc) (citation omitted),
aff'd, 218 A.3d 1246 (Pa. 2019).
Issues 1, 2 and 3 – The 1954 Letter from Trademens established a
mutual understanding between Settlor and Trustee that Trustee
would charge and receive a five percent income commission for Trust
administration.
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6As noted above, the resolution of Objectors’ Petition for counsel fees is a
matter separate from the Petition that is the subject of this appeal.
Accordingly, we decline to review PNC’s sixth issue.
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PNC’s first three issues rest on whether the trial court erred in
concluding that the 1954 Trademens Letter was an agreement establishing a
five percent income commission for administration of the Trust. PNC argues
that the 1954 Tradesmens Letter is not a fee agreement and, thus, pursuant
to Section 7768 of the Uniform Trust Act, PNC is entitled to a fee provided in
its own published fee schedule because five percent is not reasonable.
Appellant’s Br. at 36-42, 53-56. We disagree.
“An agreement is a valid and binding contract if: the parties have
manifested an intent to be bound by the agreement’s terms; the terms are
sufficiently definite; and there was consideration.” In re Estate of Hall, 731
A.2d 617, 621 (Pa. Super. 1999). In In re Estate of Breyer, 379 A.2d 1305(Pa. 1977), the Pennsylvania Supreme Court found that a letter from a
corporate trustee stating that it would charge a two percent income
commission was a fee agreement because the letter was definite and
unambiguous. Id. at 1309-10. “In ascertaining the intent of the parties to a
contract, it is their outward and objective manifestations of assent, as opposed
to their undisclosed and subjective intentions, that matter.” Ingrassia
Constr. Co., Inc. v. Walsh, 486 A.2d 478, 483 (Pa. Super. 1984).
The Uniform Trust Act provides that “[i]f a trust instrument or written
fee agreement signed by the settlor or anyone who is authorized by the trust
instrument to do so specifies a trustee’s compensation, the trustee is entitled
to the specified compensation.” 20 Pa.C.S. § 7768(b).
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The trial court here found that, as in Breyer, supra, the 1954 Letter
contained terms that are definite and unequivocal, and Settlor and Trademens
manifested an intent to be bound by them. The court stated:
[The 1954 Letter] , like the letter in Breyer, unequivocally states
the amount, source, and timing of Tradesmens’ compensation:
“five percent of the income collected.” The [1954 L]etter is clear
and unambiguous as it relates to trustee compensation from
income. Also, valuable consideration exchanged hands as
Tradesmens received a five percent of income fee for promising
the Settlor it would administer the Trust for the beneficiaries.
***
[ ] [T]he court finds the Settlor and Tradesmens manifested a
intent to be bound by the terms of [the 1954 Letter]. Tradesmens
drafted the letter the same day as the Trust’s execution, the letter
explicitly mentions Tradesmens’ compensation, and the letter
drew no protest from the Settlor. Under these facts, a reasonable
person would assume the Settlor and Tradesmens discussed the
matter of compensation and there was a meeting of the minds on
that issue. The letter itself suffices to prove this, but the parties’
later conduct lends added support. In the wake of the letter, the
Settlor transferred the Trust corpus to Tradesmens, and
Tradesmens proceeded to administer the Trust. For years,
Tradesmens calculated its fee for services rendered exactly as
prescribed by the letter. . . . Whatever the parties’ hidden aims
with respect to the Tradesmens’ letter, the record manifests the
parties’ intent to perform according to its terms.
Adjudication, 7/20/2020, at 15-19.
Our review of the record and relevant legal authority supports the trial
court’s findings. Based on the evidence presented, including testimony that
PNC and its predecessors received, without complaint, a five percent income
commission as provided in the 1954 Letter for nearly 60 years, it is
disingenuous, at best, for PNC to argue that there was no income fee
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agreement. PNC’s arguments—premised on its assertion of the non-existence
of an income fee agreement—thus fail to garner relief.
In its second and third issues, PNC argues that “even if there was a fee
agreement on income in place,” PNC satisfied the statutory requirements set
forth in Section 7768(b) of the Uniform Trust Act, “entitling it to the
presumptively reasonable fees it requested.” PNC Br. at 44. PNC also avers
that the trial court erroneously determined that the income commission it
requested was an “additional income fee.” PNC’s Br. at 35.
This Court has observed that the determination of proper compensation
is a “matter peculiarly within the knowledge, competence, and experience” of
the orphans’ court. In re Raymond G. Perelman Charitable Remainder
Unitrust, 113 A.3d 296, 308–09 (Pa. Super. 2015) (citation omitted). See
In re Estate of Sonovick, 541 A.2d 374, 376 (Pa. Super. 1988) (indicating
the determination of whether compensation claimed by a fiduciary is
“reasonable and just” is left to the sound discretion of the trial court).
Courts must give effect to a fee agreement’s terms. Estate of
Schwenk, 490 A.2d 428, 432 (Pa. 1985). Thus, where a valid agreement
between a settlor and trustee fix the terms of the trustee’s compensation,
“courts must ordinarily enforce the terms of the agreement without making
an independent determination of whether the terms are reasonable.” In re
Trust of Duncan 391 A.2d 1051, 1055 (Pa. 1978).
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However, pursuant to Section 7768(b) of the Uniform Trust Act, a court
may consider a request for an additional income fee. Section 7768(b)
provides:
(b) If specified; adjustment.--If a trust instrument or written
fee agreement signed by the settlor or anyone who is authorized
by the trust instrument to do so specifies a trustee’s
compensation, the trustee is entitled to the specified
compensation. The court may allow reasonable compensation
that is more or less than that specified if:
(1) the duties of the trustee have become substantially different
from those contemplated when the trust was created or when
the fee agreement was executed;
(2) the compensation specified in the trust instrument or fee
agreement would be unreasonable; or
(3) the trustee performed extraordinary services, and the trust
instrument or fee agreement does not specify the trustee's
compensation for those services.
20 Pa.C.S. § 7768(b). See also In re Trust of Duncan, supra, at 1055
(recognizing “an exception to the general rule in circumstances where the
trustee has performed extraordinary services beyond those contemplated by
the parties or where the compensation fixed by the agreement is so low that
the unwillingness of a competent trustee to continue or undertake to
administer the trust would defeat or substantially impair its purposes[.]”7).
The party seeking the deviation from the fee agreement has the burden
of proving that the services it rendered establish that the amount claimed is
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7 Section 7768(b) became effective in 2006, thus, codifying the exception
recognized in Duncan in 1978 and its progeny.
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“reasonable compensation.” In re Smith, 874 A.2d 131, 138 (Pa. Super.
2005) (en banc).
Here, the orphans’ court found that PNC had not provided specific
evidence from which it could “properly appraise Accountant’s alleged
substantially different duties and adjust its specified compensation
accordingly.” Adjudication at 24. First, in rejecting PNC’s contention that five
percent was unreasonable, the court concluded:
Here, the [c]ourt does not find a [five percent] income fee
agreement to be unreasonably low. For starters, Accountant
intends to continue serving as the corporate fiduciary of the
Trust.2 This without more obviates Accountant’s claim the
specified compensation is too low. See [Duncan, supra, at
1055] (stating adjustment of specified compensation [is] allowed
“where the compensation fixed by the agreement is so low that
the unwillingness of a competent trustee to continue or undertake
to administer the trust would defeat or substantially impair its
purposes”); In re Estate of Smith [supra, at 137] (“When the
question is whether the trustee compensation is so low as to
thwart the purpose of the trust, … the proper inquiry is whether a
competent trustee would service the trust at the designated rate
of compensation.”). If the [five percent] agreement were too low,
why does Accountant persist in administering the Trust? . . . One
might expect an unreasonably low fee to produce unwillingness
on Accountant’s part to continue as the corporate fiduciary, but
Accountant displays no unwillingness and has not expressed any
intention of resigning its office.
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2 The [c]ourt concludes this based on the fact the petition for
adjudication asks the [c]ourt [to] award the Trust principal to
Accountant for continued administration.
Adjudication at 20-21.
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The Orphans’ court also concluded that PNC had “not present[ed] clear
and convincing evidence of how its duties are so substantially different as to
warrant an adjustment of its specified compensation.” Id. at 21. The court
recognized that trust administration generally has changed since 1954, as PNC
witness Linda Manfredonia testified, but concluded that because PNC did not
present any evidence “linking changes in trust administration overall to
concrete changes in Accountant’s duties vis-à-vis this Trust,” it could not find
PNC’s duties to be “substantially different.”8 Id. at 22. “If anything, Mr.
Payne’s testimony shows administration of the Trust is a ‘matter of math, not
discretion,’ and his statements about the run-of-the-mill nature of the Trust’s
administration undermines Accountant’s claim of substantially different
duties.” Id.9
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8 The orphans’ court concluded “some of the changes Ms. Manfredonia
identified were immaterial.” Adjudication at 22. For instance, the court noted
that the fact that the “legal list” of investments (that existed at the time of
the Trust’s creation pursuant to the Fiduciaries Investment Act of 1949) has
been abolished had no effect on any of PNC’s administrative duties because
the Trust instrument directed the trustees to “invest in all forms of property
without restriction to investments authorized for Trustees.” Deed of Trust, §
5(b). The orphans’ court recognized that this language is “akin to a fiduciary’s
broad investment powers under the prudent investor standard” provided in 20
Pa.C.S. § 7203(b). Adjudication at 23.
9 The court also concluded that the changes about which Ms. Manfredonia
testified were inconsequential, and PNC failed to provide evidence of the value
of its allegedly substantially different duties beyond the general “bromides”
provided by Ms. Manfredonia. Id. at 23.
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Our review of the record supports the orphans’ court’s conclusion. As
noted above, the Trust is comprised of bonds, common stocks, and mutual
funds which are administered by a third-party, not PNC. The Trust does not
have any real estate holdings, small business or partnership interest, or loans
receivables. As Mr. Payne testified, the distribution of income to the Trust’s
beneficiaries is only a “matter of math” with no need for PNC to exercise any
discretion in administering the Trust. PNC is essentially asking this Court to
reweigh the evidence to reach its desired conclusion. We decline to do so.
Further, we discern no abuse of its discretion or error of law in the orphans’
court’s disposition.
Issue 4 – The orphans’ court properly exercised its discretion in
concluding that $142,000 was a reasonable principal commission as
contemplated by Section 7768(d) of the Uniform Trust Act.
PNC contends that because it based its request for compensation on its
standard scheduled rates, and the parties stipulated that PNC’s standard
scheduled rates “arose in a competitive market,” as referenced in 20 Pa.C.S.
§ 7768(d), the court erred in declining to award PNC’s “presumptively
reasonable” principal commission of approximately $216,000. PNC’s Br. at
58. PNC further avers, without citation to relevant case law, that the court
abused its discretion because the Objectors did not present compelling
evidence to rebut the presumption of reasonableness. Id. at 59.
Pursuant to Section 7768 of the Uniform Trust Act, “[n]either a
compensation provision in a trust instrument nor a fee agreement governs
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compensation payable from trust principal unless it explicitly so provides.” 20
Pa.C.S. 7768(a). Thus, where a trust instrument or a separate fee agreement
is silent on the issue of principal compensation, a trustee is not barred from
requesting such a fee. In re Kennedy’s Trust, 72 A.2d 124, 126 (Pa. 1950).
See, e.g., Schwenk, 490 A.2d at 432 (holding that a trustee was not entitled
to a terminal principal commission where the trust instrument explicitly limited
trustee compensation to income).
“A fiduciary’s compensation depends upon the extent and character of
the labor and the responsibility involved. Supervision of the amount of
compensation is peculiarly within the discretion of the orphans’ court. Unless
such discretion is clearly abused the judgment will not be disturbed on
appeal.” Breyer, 370 A.2d at 1311 (citation omitted).
The Uniform Trust Act provides:
(d) Court authority.--In determining reasonable compensation,
the court may consider, among other facts, the market value of
the trust and may determine compensation as a fixed or
graduated percentage of the trust’s market value. The court may
allow compensation from principal, income or both and determine
the frequency with which compensation may be collected.
Compensation at levels that arise in a competitive market shall be
presumed to be reasonable in the absence of compelling evidence
to the contrary.
20 Pa.C.S. § 7768(d).
In considering whether requested interim principal compensation is
reasonable, courts consider “the character of the services rendered, the
responsibility incurred, and the zeal and fidelity with which the trust of the
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accountants was carried.” In re Estate of Taylor, 126 A. 809, 810 (Pa.
1924).
Here, the court concluded that, in light of the increase of over $600,000
of the Trust’s fair market value between 2004 and 2017, and the significant
increase in the distributions of Trust income made to the beneficiaries during
this time period, “Accountant is entitled to an interim principal commission of
$145,000 which is reasonable given the Trust’s outstanding performance over
the third accounting period.” Id. at 30. The orphans’ court also concluded
that the Objectors presented compelling evidence10 showing that PNC’s
request for $216,000 was unreasonable, stating:
Accountant stated in the email it would seek a principal
commission of $145,000, later describing the sum as a “gesture
of good faith” and a way to “engender goodwill with the family.”
This gesture was not part of settlement negotiations or the like as
the email predates this litigation by seven months.
Accountant’s magnanimity pleases the [c]ourt as it rarely sees
such acts of nobless oblige. If Accountant believed $145,000 was
a reasonable principal commission, why then the [c]ourt agrees.
To hold otherwise means Accountant can seek cover behind
Section 7768’s presumption of reasonableness despite the fact it
was prepared to accept a principal commission considerably lower
than what its fee schedules would require of the Trust. The [c]ourt
will not condone this tactic and finds Accountant’s email
compelling evidence of the unreasonableness of its requested
principal commission.
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10The orphans’ court noted that, although there are several references to
burdens of proof in the Probate, Estates, and Fiduciaries Code generally,
Section 7768(d) is the only section that includes “compelling evidence to the
contrary.” Adjudication at 28-9 n.14.
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Adjudication at 29.
We discern no abuse of the court’s discretion in ordering an interim
principal commission of $145,000, which is approximately 8.7% of the
adjusted principal balance. In addition to the PNC email, the performance of
the Trust, and the benefit that inured to the beneficiaries, the court also
considered evidence, as noted above, that the administration of the Trust’s
income was “a matter of math” and that PNC is not required to provide
extraordinary services in its administration of the Trust. See N.T. at 25, 38-
39 (Testimony of Mikal Payne as on cross). We decline to reweigh the
evidence. In light of the above, we conclude that the orphans’ court properly
exercised its discretion in granting an interim principal commission of
$145,000.
Issues 5 and 6– The orphans’ court did not err in sustaining the
objection to PNC’s requested attorney’s fees.
PNC next contends that the orphans’ court erred sustaining the objection
to PNC’s request for attorneys’ fees. PNC’s Br. at 67. It avers that the court’s
finding—that “the defense of the [T]hird [A]ccount was an unnecessary
expense due to the Accountant’s impudent conduct”—is without support in the
record. Id. We conclude this issue is waived because, beyond directing our
attention to its October 10, 2018 letter, PNC has failed to provide citation to
authority or a legal analysis.
An appellant must develop arguments in his brief with citation to the
record and relevant authority. Pa.R.A.P. 2119(a). The Rules of Appellate
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Procedure clearly state that each question an appellant raises is to be
supported by discussion and analysis of pertinent authority. Commonwealth
v. Martz, 232 A.3d 801, 811 (Pa. Super. 2020). “We shall not develop an
argument for an appellant, nor shall we scour the record to find evidence to
support an argument[.]” Milby v. Pote, 189 A.3d 1065, 1079 (Pa. Super.
2018). To do so would place this Court “in the conflicting roles of advocate
and neutral arbiter.” Commonwealth v. Williams, 782 A.2d 517, 532 (Pa.
2001) (Castille, J., concurring). Therefore, an appellant waives any issue he
fails to develop sufficiently. Sephakis v. Pa. State Police Bureau of
Records, 214 A.3d 680, 686-87 (Pa. Super. 2019). PNC failed to develop
this issue in a meaningful way. PNC’s failure to cite relevant legal authority
and provide fact-specific legal analysis hampers this Court’s review of the
issues and, therefore, we are constrained to conclude that issues five and six
are waived.
Having concluded the trial court properly exercised its discretion and
committed no error in applying fundamental law, we affirm.
Decree affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 10/12/2021
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