Recent Cases:
Accounting Upheld After Buy-Out of Decedent’s Shares in a Closely Held Business Were Deposited Into Estate and Made Subject to Expenses
In the Matter of the Estate of Dominic Denora, 2012 N.J. Super. Unpub. ____ (Docket No.: A-3101-11T4) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Chancery Division, General Equity Part, Middlesex County. Before Judges Yannotti and Harris.
Appellant, Decedent’s ex-wife, was a beneficiary under Decedent’s Will of 51% of the shares of Decedent’s company, King George Auto Sales (“King George”), with the remaining 49% devised to Decedent’s brother, Robert. Appellant was also named as the residuary beneficiary under Decedent’s Will. Appellant appeals from the trial Court’s dismissal of her exceptions to the accounting filed by the Estate and Trustee of Decedent’s inter vivos trust.
Decedent appointed Alfred Krivak as Executor and Trustee, and appellant and her children were the beneficiaries of the inter vivos family trust.
In August, 2006, Decedent’s Will was admitted to probate. In January, 2007, appellant filed a law suit claiming that she was an oppressed minority shareholder of King George and also asserted an interest in a partnership owned by Decedent and his brother, Robert, which held the land occupied by King George. The matter was submitted to arbitration and a decision and award was entered on September 17, 2008. The arbitrator ordered Robert to purchase appellant’s share in King George for $731,000 and dismissed the oppressed shareholder claim. The Estate agreed to be bound by the award. The arbitrator ordered the Estate to issue 100% of the shares of King George to Robert upon its receipt of $731,000. The trial Court affirmed the arbitrator’s award as fully supported by the record, as the buy-out was the only practical solution. Appellant appealed.
While this appeal was pending, appellant filed a motion seeking an order directing the Estate to distribute the $731,000 received from Robert to appellant, which was denied.
On appeal, the arbitrator’s award was confirmed.
In December of 2010, the Estate filed a motion seeking an order requiring disbursement of $500,000 to appellant with the remainder being held to cover the Estate’s ongoing litigation costs. The trial court agreed, allowing for the Executor to use a portion of the monies to pay litigation expenses of the Estate.
Krivak then filed a complaint seeking approval of his accountings for the Estate and inter vivos trust. Exceptions were filed by appellant, including exception to the use of the proceeds received by the Estate concerning the buy-out of her shares. The Estate then filed a motion seeking to strike certain exceptions, and the trial Court agreed, entering an order striking certain exceptions. A motion for reconsideration was denied and a hearing held, when the trial court dismissed the remaining exceptions and approved the accountings. Appellant appealed.
Appellant argues on appeal that the trial court erred in directing that a portion of her buy-out of the shares in the amount of $731,000 could be used for Estate expenses. Appellant claimed that the shares should have passed directly to her at death and payment should not have been made to the Estate. The Appellate Division upheld the trial Court’s dismissal of the exceptions, finding that appellant was bound by collateral estoppel because she failed to raise the issue as to ownership of the shares with the arbitrator and is therefore bound by its decision. It is also clear from the record that the issue was an issue in the arbitration proceeding and it was decided by the arbitrator that the proceeds would be paid to the Estate. The trial Court’s approval of statutory commissions to the Executor and Trustee was also found to be proper.
Appointment of Administrator ad Prosequendum to File Malpractice Action on Behalf of Estate
In the Matter of the Administration of the Estate of Kolapo Ojebuoboh, 2012 N.J. Super. Unpub. ____ (Docket No.: A-5647-09T1) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Chancery Division, Middlesex County. Before Judges A. A. Rodriguez and Grall.
Decedent’s wife appeals the Chancery Division’s appointment of Decedent’s girlfriend as Administrator ad Prosequendum to file and prosecute a medical malpractice action on behalf of the Estate.
Decedent was married in 1983 and filed for divorce from his wife in 1996. The divorce proceedings were never finalized, but Decedent owed spousal support in excess of $69,000 and a judgment was issued against him. In 1997, Decedent’s girlfriend moved to the U.S. from Nigeria, settled in New Jersey and began living with Decedent and conceived a son. They held themselves out as husband and wife on income tax returns and the like, despite the fact that there was no evidence that they were ever married. Decedent also named his girlfriend as a beneficiary of his life insurance policy.
Decedent died intestate with no assets. After his death, Decedent’s girlfriend applied for Letters of Administration, and his wife filed an Answer and Counterclaim, also seeking to be appointed as Administrator. The Chancery Division appointed Decedent’s girlfriend as Administrator ad Prosequendum, and his wife appealed.
On appeal, Decedent’s wife argued that the statute required her appointment. N.J.S.A. 3B:10-2 states that a spouse shall be appointed as administrator so long as she files for letters within 40 days of Decedent’s death. Decedent’s wife filed for administration more than 40 days after the date of death. In light of the passage of time, the statute grants the Court authority to appoint “any fit person” applying for letters.
After reviewing the arguments, the Court found that Decedent’s wife was conflicted with an incentive to collect the debt owed to her, and would not necessarily look after the rights of Decedent’s only son, as heir of the Estate. Decedent’s girlfriend, as the person listed as next of kin on Decedent’s medical records, who was much more familiar with Decedent’s medical condition and care, was in a superior position to pursue the malpractice action on behalf of the Estate. She had no apparent interest adverse to those entitled to share in the Estate or Decedent’s wife’s interest in collecting the debt owed to her. The Chancery Division‘s appointment of Decedent’s girlfriend was therefore affirmed, and the matter remanded for the Court to clarify the scope of the Administrator’s duties.
Attorneys’ Fees – Legal Malpractice Action Filed Against Former Attorneys in a Will Contest Dismissed Based on Lack of Expert Testimony, and Attorneys’ Fees Upheld
John K. Walsh, Jr., Esq. and Walsh & Walsh, Esqs. v. Daniel Provenzano and Jo-Anne Olszewski, 2012 N.J. Super. Unpub. ____ (Docket No.: A-4043-10T1) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Law Division, Bergen County. Before Judges A. A. Rodriguez, Sabatino and Ashrafi.
Defendants appeal from the trial Court’s dismissal of their legal malpractice Complaint filed against their former attorneys who represented them in an unsuccessful claim against the Estate of their deceased father.
In July 2005, Defendants met with and then hired Plaintiffs regarding their late father’s Estate. Plaintiffs prosecuted a claim on Defendants’ behalf and were paid $93,700 by Defendants during the Estate litigation pursuant to an executed retainer agreement. After an unsuccessful trial, Plaintiffs’ services were terminated. Plaintiffs then filed suit requesting that the additional fees owed by Defendants be paid. Defendants counterclaimed claiming legal malpractice, but did not produce an expert witness.
After holding a trial, the trial Court issued a judgment in Plaintiffs favor for the outstanding fees and dismissed Defendants’ claim of legal malpractice, as they failed to produce an expert witness on the issue of Plaintiffs’ alleged deviation from the standard of care. Defendants appealed, and the decision of the trial Court was affirmed on appeal.
In rendering its decision, the trial Court pointed to the fact that Plaintiffs made substantial payments on account pursuant to a written retainer agreement, were provided with detailed monthly statements and an accounting, and did not object to the requested fees until receiving an adverse judgment in the Estate litigation. Based on these facts, their opposition to the fee request was dismissed. Also, the fact that Plaintiffs failed to produce expert testimony on their legal malpractice claim rendered their counterclaim dismissible as a matter of law.
Collection of Debt Owed to Decedent Summary Judgment Reversed Given Issues of Fact in Dispute
Stephen C. Leonard, Esq., Administrator of the Estate of Maria Radziewicz v. Polish Army Veterans Association of America, Post 208, Polanka, 2012 NJ Super ____ (Docket No.: A-4415-10T3) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Law Division, Middlesex County. Before Judges Parrillo and Skillman.
Appellant appeals the trial Court’s grant of summary judgment awarding the Estate of Maria Radziewicz $48,416.59 representing principal and interest on a purported promissory note executed on behalf of Post 208 of the Polish Army Veterans Association (“Post 208”). Summary judgment was granted without oral argument or any findings of fact or conclusions of law. On appeal, summary judgment was reversed.
In November of 2001, Post 208 entered into a contract with its National Headquarters agreeing to pay $171,107 owed on a loan. In December 2001, the Board of Directors of Post 208 voted unanimously to accept member loans to pay off the existing loan with National Headquarters, with no member becoming entitled to repayment until Post 208 became solvent.
On June 25, 2002, Maria Radziewicz gave Post 208 a check for $30,000 towards loan repayment. Post 208’s financial secretary confirmed the loan in writing. It was acknowledged that Maria Radziewicz deposited $30,000 and reserved the right to have the entire amount repaid within 2 years with interest of 7%.
In discovery, the Board of Directors of Post 208 certified that the financial secretary ignored the requirement that loans will only occur if the post was solvent, and that he acted without the authority of the Board. Maria Radziewicz never demanded repayment of the loan during her life, but after she died, her Estate sought repayment.
After her death, the administrator of her Estate demanded repayment which was rejected. Plaintiff administrator then sued Post 208 for interest and principal due on the promissory note. Post 208 answered, denying liability and characterizing the deposit as a donation. Plaintiff sought summary judgment, which was opposed. Without holding oral argument, the Court granted summary judgment in favor of the Estate.
Post 208 appealed, claiming that issues of fact exist as to whether the financial secretary acted outside his scope of duty or whether the promissory note was ratified by Post 208. The Appellate Court agreed, and reversed.
The Appellate Court found that there are issues of fact as to the purpose and binding effect of the so-called promissory note which was in the form of a letter sent 3 months after the payment of $30,000 was made, and questions as to the financial secretary’s authority to bind Post 208 still exist. There were also no payments of principal or interest during Decedent’s life, well beyond the 2 year period she was guaranteed the right to repayment.
Given the issues of fact left unresolved, the grant of summary judgment was inappropriate.
Estate Administration – Creditor Claim on Israeli Estate – Lack of Jurisdiction
Barbara L. Newman v. Estate of Rose Newman, et al., 2012 N.J. Super. Unpub. ____ (Docket No.: A-2641-10T1) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Law Division, Hudson County. Before Judges Yannotti, Espinosa and Kennedy.
Plaintiff filed a claim against her mother-in-law’s Estate claiming that the Estate owes her for legal fees incurred over a 10 year period prior to Decedent’s death. Decedent lived in Israel where her estate was being administered. The claim for fees was filed after an administrator was appointed in Israel for the Estate.
The lower Court dismissed the claim, without prejudice, allowing for Plaintiff to pursue her claims in Israel against the Estate. The Plaintiff appealed.
In affirming the decision, the Court found that the lower Court properly found that the first-filed action occurred in Israel, when the Decedent’s Will was probated, and that New Jersey should therefore defer to that jurisdiction. The principle of comity would cause the Court to decline to interfere with the Israeli Court’s jurisdiction, provided that Plaintiff’s claims are cognizable in that jurisdiction. Plaintiff failed to establish that her claim could not be addressed in Israel. The matter was dismissed without prejudice, allowing Plaintiff to proceed in Israel for payment of her legal fees.
Denial of Legal Fees to Mother Seeking Guardianship and a Trust Over her Adult Son’s Inheritance
In the Matter of the Estate of Willie Booker, Deceased, 2012 N.J. Super. Unpub. ____ (Docket No.: A-0382-11T2) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Essex County. Before Judges Cuff, Lihotz and St. John.
Willie Booker died intestate survived by an adult son, his sole heir. Decedent’s mother filed a verified Complaint seeking her appointment as administrator, creation of a special needs trust and appointment of trustee for her grandson, the sole heir. She filed another Verified Complaint seeking a medical and psychiatric evaluation of her grandson, a declaration of incapacity, and her appointment as guardian over his person and property.
Six months after filing the Complaints, Decedent’s mother fired her attorney and proceeded pro se. She also withdrew the guardianship action. Decedent’s mother sought legal fees from the Estate which were denied. The trial Court held that there was no basis to award counsel fees from the Estate, noting that the guardianship action was withdrawn, it was severely deficient on its face, and Decedent’s mother had not demonstrated how any of her actions aided in preservation or protection of the corpus of the estate. This decision was affirmed on appeal.
Denial of Pension Benefits to Surviving Spouse Based on Binding Retirement Plan Elections
In the Matter of A. Lynne Lindenthal for Peter W. Lindenthal, deceased v. Board of Trustees, Public Employees’ Retirement System, 2012 N.J. Super. Unpub. ____ (Docket No.: A-2793-09T3) (App. Div. 2012). On appeal from the Board of Trustees, Public Employees’ Retirement System. Before Judges Waugh and St. John.
Plaintiff appeals the final Administrative Determination of the Board of Trustees of the Public Employees’ Retirement System (the “Board”) denying her request to receive a monthly pension benefit upon the death of her husband, Peter.
In September of 2008, the Division of Pensions and Benefits (the “Division”) received Peter’s retirement application requesting a veteran retirement, effective January 1, 2009, under the maximum option, in lieu of smaller payments during his life and a pension to his wife upon his death. He indicated he had a spouse and thus, the Division sent her a letter about the option’s future effect. Instead of selecting a beneficiary to receive a survivor’s benefit at his death, Peter chose the “Maximum Option – No Pension to Beneficiary”.
On December 10, 2008, the Board approved Peter’s retirement application under the maximum option, with an effective date of January 1, 2009. Peter passed away on January 28, 2009, 27 days after making the election. Under N.J.S.A. 43:15A-50, if a member dies within 30 days after the date of retirement, he is treated as an active member. Subsequent to Peter’s death, the Division notified Lynn that she was entitled to a group life insurance benefit of $262,292.86. She was also informed that because Peter chose the maximum option, she was not entitled to a monthly pension and any unpaid contributions and interest would be returned to Peter’s Estate. Lynn filed an appeal with the Office of Administrative Law disputing the non-payment of monthly pension benefits to her, which was denied.
On appeal, the Court agreed, holding that the statutory scheme governing payments to beneficiaries of members who had applied for retirement but died during the thirty-day period, allowed the beneficiary to elect between the retirement benefit or full life insurance death benefits, but precluded receipt of both. Since Peter did not choose the optional retirement benefit for his spouse, he was only entitled to life insurance benefits as an active member under the statute. Also, the accumulated contributions and interest were properly paid to his estate as Peter did not name a beneficiary.
Division of Personal Property and Other Issues
In the Matter of the Estate of Frank M. Leonard, Deceased, 2012 N.J. Super Unpub. ____ (Docket No.: A-5181-10T3) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Sussex County. Before Judges Reisner and Simonelli.
This is appellant’s second appeal. Appellant’s father, Frank Leonard (“Decedent”) was married to Ada Leonard who predeceased him. Decedent died in 1991, and his will bequeathed a life estate in his Branchville, NJ residence to his second wife, Elizabeth, and the personal property belonging to Ada Leonard to his children, including appellant.
Elizabeth filed a complaint seeking to prohibit Decedent’s children from occupying or interfering with her use of the Branchville property, and appellant counterclaimed, alleging waste and seeking her removal as Executrix, a forced sale of the property and access to Elizabeth’s apartment in Washington, DC to remove any personal property belonging to Ada Leonard. After holding a trial on the counterclaim, the trial Court denied the relief requested by appellant in his counterclaim and issued an order in October of 2008. Appellant did not appeal this order.
Appellant subsequently filed a motion seeking access to the Branchville property to remove Ada’s personal property, which was denied. The trial court also awarded Elizabeth legal fees for having to defend the motion. Appellant appealed from this Order and also sought appeal of some issues covered by the October, 2008 order of the trial Court. The matter was remanded to the trial Court by the Appellate Division, and appellant sought to vacate the October order of the trial Court, claiming misconduct. In an oral decision, the trial Court refused to vacate the October order, finding no misconduct, vacated the award of counsel fees to Elizabeth, and required Elizabeth to respond to a list of 78 items appellant claimed belonged to Ada Leonard. An order was subsequently issued and appellant appealed. A few months later, the trial court ordered that 8 of the 78 items belonged to Elizabeth, and appellant appealed from that Order.
On appeal, the Orders were upheld, with the Court failing to find any misconduct or collusion, and if appellant believed there was any misconduct, he should have timely appealed the October 2008 order, which was now time barred.
Life Insurance Ordered Paid to Decedent’s Divorced Spouse in Light of Judgment of Divorce Giving her the Rights to Decedent’s Choses in Action
In the Matter of the Estate of Mittal Barua, 2012 N.J. Super Unpub. ____ (Docket No.: ESX-CP-0017-2011) (Ch. Div. 2012).
Plaintiff married Decedent on June 25, 1993. At the time, Plaintiff’s son was six years old. On January 19, 2006, Decedent traveled to Bangladesh with the intention of staying for 30 days, however, he never returned.
Two years later, Plaintiff filed for divorce. An Amended judgment of Divorce was entered on February 5, 2008 wherein Plaintiff was granted Decedent’s interest in certain real property and any and all choses in action.
At the time of his disappearance, Decedent had a life insurance policy naming Plaintiff and her son as primary and secondary beneficiaries. Plaintiff continued to pay the premiums.
Three years after the entry of the Judgment of Divorce, Plaintiff filed an Action seeking a Declaration of Death of Decedent, who they have not seen for five years. An Answer was filed by the Office of the Attorney General, Unclaimed Property Administrator. The Court ultimately declared Decedent dead, ordered the insurance policy proceeds deposited with the Court, and allowed Plaintiff to file an Amended Complaint seeking the turnover of the insurance poliy proceeds.
Plaintiff then amended her Complaint. A motion for summary judgment was brought and the Court, after analyzing the terms of N.J.S.A. 3B:3-14 in light of the Judgment of Divorce, ordered the proceeds paid to Plaintiff as beneficiary.
N.J.S.A. 3B:3-14 provides that a Judgment of Divorce revokes any revocable designations in a governing instrument, which includes a life insurance policy. Plaintiff argued that the statute didn’t apply to these facts, as Plaintiff became entitled to the insurance proceeds by virtue of the judgment of Divorce which gave her all of Decedent’s choses in action. The Court found ample authority to support the position that the policy proceeds were a choses in action, and therefore granted summary judgment in Plaintiff’s favor, ordering the proceeds paid to her as beneficiary under the policy.
Palimony Claim Arising Prior to Change in Statute Upheld
Maria Harrison v. Estate of Carl J. Massaro, 2012 N.J. Super. Unpub. ____ (Docket No.: A-3497-09T2) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Family Part, Hunterdon County. Before Judges Payne, Reisner and Hayden.
Defendant, the Estate of Carl J. Massaro, appeals from the trial Court’s award of palimony in the amount of $2,273,031 to Plaintiff.
After a fourteen day trial, the Court ordered that palimony be paid to Plaintiff. Decedent had died 1 and ½ years prior to the effective date of the new statute requiring all agreements to be in writing, which the Court refused to apply retroactively.
After a trial, the Court found substantial credible evidence of Decedent’s promise to provide for Plaintiff after an extensive relationship that they shared for over 14 years. There were numerous witnesses to support Decedent’s promise that Plaintiff would receive income of $20,000 per month so that she did not need to work for the rest of her life, that Plaintiff assisted Decedent in his business ventures over the years, and lived in a marital type relationship with him for over 14 years.
This decision was upheld on appeal, with the Appellate Division failing to retroactively apply the changes in the Statute of Frauds which requires all palimony agreements after the enactment of the statute to be in writing. The Court also upheld the trial Court’s failure to award fees in the matter.
Removal of Executor and Trustee and Appointment of Custodial Receiver for Decedent’s Business Deemed Premature in Light of Clear Dispute Over the Underlying Facts
In the Matter of the Estate of Ronald E. Manus, Deceased, 2012 N.J. Super Unpub. ____ (Docket No.: P-065-12) (Ch. Div. 2012).
Decedent passed on September 17, 2010, leaving a Will dated July 22, 2009, which named his brother, Kenneth as Executor, and his brother, Lawrence, as Trustee of separate trusts established for Decedent’s three children.
Plaintiff, Decedent’s ex-wife, filed a Complaint seeking a distribution from the trusts for her three children, an accounting, removal of Decedent’s brothers as Executor and Trustee, and for the appointment of a custodial receiver for Decedent’s bagel stores that were being run by Decedent’s brother and executor, Kenneth.
In denying the appointment of a receiver and Plaintiff’s request to remove the fiduciaries of the Estate as premature, the Court cited the fact that Plaintiff failed to establish the likelihood of success on the merits in light of the specific factual denials of Kenneth and Lawrence as Executor and Trustee. Discovery had yet to commence and there were insufficient facts to support the request for a custodial receiver. The Court denied Plaintiff’s request, without prejudice, and instead ordered an accounting and an expedited discovery schedule.
Request for a Return of Decedent’s Property Which Escheated to the State was Denied in Light of the Passage of Time
In the Matter of the Real and Personal Property of Carl Bekysewycz, Deceased, 2012 N.J. Super Unpub. ____ (Docket No.: A-4455-09T2) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Chancery Division, Mercer County. Before Judges Payne and Hayden.
On December 11, 1987, the Chancery Court entered an Order providing for the escheat to the State of funds constituting Decedent’s Estate if no next-of-kin were discovered within three years of Decedent’s death, which occurred on May 10, 1986. In 2008, appellant was appointed as administrator of the Estate following an ex parte application with the Hunterdon County Surrogate. Appellant appeal’s from the April 16, 2010 order of the trial Court denying appellant’s request to amend the Chancery Division’s order of December 11, 1987 to provide for payment of the escheated funds to either the Administrator of Unclaimed Property to hold for the benefit of the Decedent’s heir, or to his Estate.
Decedent died intestate on May 30, 1986. On July 3, 1986, the State filed a Complaint for escheat of the Decedent’s real and personal property under prior law. The Court appointed a conservator of Decedent’s property and ordered publication in the Hunterdon County newspaper thereby providing notice to all heirs and creditors that the State has filed an action seeking adjudication as to the title of the property owned by Decedent. The Court subsequently ordered Decedent’s real property sold, his claims paid and for the remaining funds to be turned over to the Attorney General for a period of three years. If no next of kin were discovered during that period of time, the order authorized the Attorney General to pay the proceeds to the State Treasurer, which occurred in 1993.
Approximately 22 years after Decedent’s death, Appellant applied for Letters Testamentary and 16 months later, brought suit, claiming the State failed to conduct a diligent inquiry for Decedent’s heirs.
Despite the fact that the Court file was no longer available, nor the file of the Attorney General which had been destroyed, and the conservator appointed by the Court was also deceased, the trial Court refused to reopen the matter, finding that the Notice published by the conservator was sufficient notice under prior law. The Court also refused to retroactively apply the current Unclaimed Property laws to an Estate which was governed by prior law.
On appeal, the Appellate Division affirmed, finding that the statutory amendments to the code which would place the funds with the Administrator of Unclaimed Property did not take effect until some time after the final escheat of Decedent’s property in 1993. Appellant therefore had no claim for principal, interest or fees.
Husband’s Right to Funds From Marital Estate to Pay For Criminal Defense Under the Slayer Statute Was Properly Denied
In the Matter of the Estate of Linda Ann Rambo, Deceased, 2012 N.J. Super. Unpub. ____ (Docket No.: A-5308-09T2) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Chancery Division, Warren County. Before Judges Fuentes and Graves.
Decedent’s husband, Roy Rambo, appeals from the Chancery Division’s denial of his request for a distribution of 50% of the marital estate to fund his criminal defense.
In 2002, Roy Rambo was indicted and charged with murdering his wife, Linda. While awaiting trial on this criminal charge, Decedent’s only son, Bruce Rambo, obtained an order from the Chancery Division under the Slayer Statute (N.J.S. 3B:7-1.1) restraining Roy Rambo from utilizing any assets of the marital estate to fund his criminal defense. The Court also appointed Bruce Rambo as administrator of Linda’s Estate. The Estate consisted of parcels of real estate, extensive personal property and investment accounts which totaled over $3.0 million.
While awaiting the criminal trial, Bruce Rambo filed a wrongful death action and survivor action against Roy Rambo on behalf of himself and the Estate. On February 9, 2005, Roy Rambo was convicted of murdering his wife and he was sentenced to a term of forty years. On July 6, 2005, the Law Division entered judgment against Roy Rambo in the wrongful death suit awarding $6,310,000 in damages.
Roy Rambo now appeals an order entered by the Chancery Division on May 17, 2010 equitably distributing the assets of his former marital estate, arguing that the Court misapplied the Slayer Statute and improperly prevented him from accessing funds which were rightfully his. Following an equitable distribution hearing, the Chancery Division entered its order of May 17, 2010, awarding Roy Rambo $290,314.51 of the marital estate, deducting this amount from the judgment entered on the wrongful death suit, leaving a balance of $5,709,6895.49 owed by Roy Rambo to Bruce Rambo and the Estate, awarding Roy Rambo’s sister his personal clothes, and ordering Roy Rambo responsible for the taxes associated with the distribution of his IRA to the Estate.
In his appeal, Roy Rambo claimed that the Chancery Division misapplied the Slayer Statute in failing to release funds to him to pay for his criminal defense, forcing him to hire a Public Defender in lieu of counsel of his choice. On Appeal, the Appellate Division held that the restraints issued by the Chancery Division were supported by the Slayer Statute, which provides that a surviving spouse who intentionally kills the decedent is not entitled to any benefits from the estate and the estate passes as if the killer predeceased the decedent. This includes property of a joint tenant which severs any rights to survivorship that the killer had in the property. To permit Roy Rambo to use the proceeds of the marital estate to pay the cost of private counsel would be a perversion of justice under the Slayer Statute. The order was therefore affirmed.
Wrongful Death Action – Heir’s Loss of Prospective Inheritance Resulting From Increased Estate Taxes Are Cognizable in a Wrongful Death Claim
Robert B. Beim and Franklyn Z. Aronson, as Co-Executors of the Estate of John G. Kellogg, et al. v. Trevor R. Hulfish and Teresa Cupples, et al., 2012 N.J. Super. Unpub. ____ (Docket No.: A-5947-10T4) (App. Div. 2012). On appeal from the Superior Court of New Jersey, Law Division, Mercer County. Before Judges Fuentes, J. N. Harris and Koblitz.
The Appellate Division, in reversing the lower Court, held that an heir’s loss of a prospective inheritance resulting from the imposition of increased estate taxes incurred due to the premature death of a decedent is recoverable in a wrongful death action.
On January 25, 2008, John Kellogg and his second wife, Barbara Kellogg, were passengers in a car which collided with a car owned by Defendant. Mr. Kellogg was 97 years of age. After the collision, Mr. Kellogg was treated at the hospital for a week then released. Within a week, Mr. Kellogg died from injuries suffered as a result of the accident.
In 2008, Mr. Kellogg’s estate paid $1,195,083.57 in estate taxes. Plaintiffs allege that had Mr. Kellogg survived until 2009 or later, his estate tax obligation would have been reduced by $626,083 in 2009, and by the full amount of $1,196,083.57 in 2010. In the law division, Plaintiffs sought to recover the difference in estate tax consequences under the Wrongful Death Act as pecuniary injuries resulting from the premature death of Mr. Kellogg. Defendants’ motion to dismiss this claim was granted, with the lower Court finding that the damages were too speculative in nature. This decision was entered nine days before the existing estate tax law and exemptions were extended through 2012 by Congress. This extension would have exempted Mr. Kellogg’s property from estate taxation had he lived past 2009. Plaintiffs filed a motion for reconsideration based on the change in law which was denied, with the Court holding that the damages contemplated by Plaintiffs were still too speculative in nature.
After the balance of Plaintiff’s claims were dismissed by motion practice or Stipulation, this appeal was filed.
The goal of the Wrongful Death Act is to compensate survivors of those wrongfully killed for their pecuniary loss, and permits recovery only for a survivor’s calculable economic loss. The question before the Court is one of first impression. Given the narrow window of Mr. Kellogg’s life expectancy of 3.2 years and the extension of the existing estate tax law, the Appellate Division held that it was not unduly speculative to recognize that but for Defendant’s alleged tortious conduct that Mr. Kellogg might have survived to a point that his estate’s tax liability was eliminated, resulting in a tangible economic benefit to his heirs. It was also proper to submit this question to a jury, which regularly considers the life expectancy of individuals in personal injury actions. The Court also noted that evidence sufficient to guide the jury on this issue must be accompanied by competent expert opinion.
Intestate Estate – Foreign Domiciliary
In the Matter of the Estate of Yung-Ching Wang, Deceased, 2011 N.J. Super. Unpub. ____ (Docket No.: A-3035-09T3; A-3036-09T3) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Essex County. Before Judges Wefing, Payne and Baxter.
Decedent, YC Yang, died in 2008 in Short Hills, NJ at the age of 92. He was born in Taiwan and remained a citizen of that country. His estate was valued at over $5 billion, but he died without a Will. His first wife, second wife, and some children filed suit seeking to be appointed as administrator and seeking discovery of decedent’s assets. The lower court limited the discovery and no New Jersey assets were found. Decedent was involved with four companies in the past, but none of them were based in New jersey. The Appellate Division therefore dismissed the Complaints holding that the New Jersey Courts should not be burdened with proceedings that seek world-wide discovery and present issues, the ultimate resolution of which turns on interpretation of Taiwanese law. Plaintiffs must seek recourse from Taiwan, not New Jersey.
Intestate Estate – Laches
Kurt Pratt v. Dexter Miller; Ladd World, Inc., 2011 N.J. Super. Unpub. ____ (Docket No.: A-3286-09T4) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Camden County. Before Judges Carchman and Messano.
Plaintiff filed suit seeking a distribution of his intestate share of his father’s estate. Decedent died intestate in 1993 owning property in Camden solely in his name. Decedent was survived by his spouse and 5 children. Decedent’s wife was the administratrix of the estate and conveyed the Camden property to herself in 1994. Plaintiff filed a Complaint in 2009 seeking damages equal to his intestate share in the property. The Court, in reviewing the intestate share of the surviving spouse, which was equal to the first $50,000 of the estate plus 1/2 of the remainder, was unable to compute the share as no evidence was presented regarding the Decedent’s other assets. The Court also cited the fact that Plaintiff new of the Deed transfer since at least 2000 and did not file suit until many years later. Based on the length of the delay before Plaintiff filed suit, the failure of Plaintiff to articulate an adequate reason for the delay, and the prejudice that would result, the Court dismissed the matter based on laches. This decision was upheld on appeal.
Intestate Estate – Validity of Foreign Divorce
In the Matter of the Estate of Anthony Sarcona, Deceased, 2011 N.J. Super. Unpub. ____ (Docket No.: A-6076-09T2) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery, Probate Part, Monmouth County. Before Judges Cuff and Simonelli.
Plaintiffs, the former wife and children of decedent, appealed the trial court’s dismissal of their complaint seeking a declaration by the former wife that the Dominican Republic divorce decree obtained by decedent was void.
In 1979, decedent was divorced from his first wife in the Dominican Republic. He had entered into a settlement agreement with his former wife and a judgment of divorce was issued. Decedent was remarried in 1995 and died intestate in 2010. His wife obtained letters of administration, and plaintiffs sued, seeking to void the divorce decree and an order naming them as beneficiaries of the estate. Although the facts were in dispute, the trial court dismissed the matter summarily finding that the foreign divorce should be respected. The court applied New York law, where the spouses resided at the time that the divorce decree was entered. Under NY law, foreign divorces are recognized if both parties appeared in the action and were served with process. The plaintiff former wife signed a settlement agreement and a proxy agreeing to the divorce in 1979, and to the extent that fraud was cited, she failed to plead with particularity. Although she claimed she did not sign a proxy, the court dismissed this claim based on laches, as 31 years had lapsed since the divorce decree was entered.
Intestate Estate – Validity of Foreign Heirs
In the Matter of the Estate of Peter Bulhack, Deceased, 2011 N.J. Super. Unpub. ____ (Docket No.: A-3602-09T1) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery, Probate Part, Union County. Before Judges R. B. Coleman and Lihotz.
Decedent died intestate. He was not survived by a spouse, children, parents or grandparents. His heirs included first and second cousins. Plaintiffs, foreign beneficiaries living in Belarus, were represented by counsel. Decedent’s first cousins living in the United States rejected Plaintiffs’ lineal assertions. The trial court found that the eight Belarus plaintiffs were cousins of the Decedent and entitled to inherit a portion of his estate. The Defendant appealed, claiming that the Plaintiffs failed to offer proof that they survived the Decedent.
The trial court, in rendering its opinion, relied on NJRE 902(c), finding that copies of the sealed birth certificates, death and marriage certificates provided by Plaintiffs’ expert were sufficient to prove their right to inherit. On appeal, the Appellate Division agreed, and also held that the powers of attorney given to Plaintiffs’ counsel after Decedent’s death to act of their behalf in the litigation were sufficient to show that they survived the Decedent. The matter was remanded to determine whether these documents were in fact, properly executed and sealed by the apostille of a foreign office, pursuant to the 1961 Hague Convention Treaty Abolishing the Requirement of Legalization of Foreign Documents.
In the Matter of the Estate of Peter Bulhack, Deceased, 2011 N.J. Super. Unpub. ____ (Docket No.: A-3602-09T1) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery, Probate Part, Union County. Before Judges R. B. Coleman and Lihotz.
On remand, the Appellate Court reviewed the trial Court findings and upheld the legitimacy of the claims of the foreign beneficiaries. The trial court reviewed the documents presented by all of the parties to discern whether they survived the decedent. Citing the powers of attorney which were signed after decedent’s death, and authenticated by apostille, the lower court concluded that they had survived the decedent. This was upheld on appeal.
Legal Malpractice – Beneficiary Suit Against Estate Attorneys May Move Forward Despite Prior Probate Proceedings
Higgins v. Thurber, 2011 N.J. Unpub. ____ (Docket No.: A-12-10) (2011). Before the New Jersey Supreme Court. On certification to the Superior Court of New Jersey, Appellate Division, whose opinion is reported at 413 N.J. Super. 1 (2010).
The Supreme Court considered whether Plaintiff’s legal malpractice action against the attorneys who represented their late father’s estate was barred by the entire controversy doctrine in light of the disposition of earlier law suits including an accounting action.
In a prior probate proceeding, the executor sought approval of his formal accounting of a Trust formed by plaintiffs’ deceased father. Plaintiffs’ filed exceptions in the prior proceeding, sufficient to constitute a legal malpractice claim against defendants, who intervened in the accounting action before trial. Following the conclusion of the accounting action, plaintiffs filed the within malpractice action. Summary Judgment was entered in favor of defendants barred the suit under the entire controversy doctrine. The Appellate Division reversed.
The Supreme Court, in upholding the Appellate Division’s remand, found that although a potential claim sounding in legal malpractice may have been raised in the probate proceeding, it cannot be said that plaintiffs had a “full and fair opportunity to litigate those claims or that it would otherwise be equitable to bar this subsequent suit” under the entire controversy doctrine.
The Court also found that an accounting proceeding in the probate part is formalistic in nature, involving line by line exceptions, and that the entire controversy doctrine is out of place. It involves a proceeding to address the conduct of an executor but not others. The Court also took note of the fact that the underlying pleadings in the accounting actions did not encompass claims for legal malpractice.
Legal Malpractice – No Duty of Care to Beneficiary Adverse to the Estate
Taffaro v. James R. Connell, Esq., at al., 2011 N.J. Unpub. ____ (Docket No.: A-4928-09T2) (2011). On appeal from the Superior Court of New Jersey, Law Division, Bergen County. Before Judges Payne, Simonelli and Hayden.
This matter involves plaintiffs’ appeal of the lower court’s dismissal of his malpractice actions against his step-mother’s estate planning attorneys for failure to include him as beneficiary of her Will. On appeal, the Appellate Court upheld the lower court’s dismissal finding that defendant attorneys, as estate planning attorneys, owed no duty to plaintiff as they represented plaintiff’s step-mother, not plaintiff, in preparing her estate plan. The Court also held that no duty was owed to plaintiff who failed to file a Will contest but instead filed a claim adverse to the interest of the estate.
Vincent Taffaro was the father of plaintiff, Michael Taffaro, and Scott Taffaro. After Vincent’s wife died, he married Dolores Taffaro, and they had 2 children. After Vincent’s death in 1998, Dolores’ daughter, Susan, asked attorney Connell to prepare a Will on Delores’ behalf. Connell met twice with Delores, who was unsure whether to include plaintiff as a beneficiary under her Will, as he was on disability and suffered from drug use. Delores signed a Will prepared by Connell on December 2, 1999, deciding to include plaintiff as a beneficiary. Soon thereafter, Delores was hospitalized until her death on December 24, 1999. On December 17, 1999, Delores called Connell and told him she had a change of heart and wanted to remove plaintiff as a beneficiary of her estate. Delores executed a new will (the “second Will”) on December 20, 1999, which did not include plaintiff as a beneficiary.
Following Delores’ death, the second Will was probated. Plaintiff did not challenge this Will as he claims that his sister, Susan, as Executrix agreed to include him as a beneficiary. Plaintiff eventually filed a Complaint seeking to establish a constructive trust over the assets of the Estate in an effort to receive his 1/4 share. The matter settled on December 5, 2005 with plaintiff receiving $110,000, representing his 1/4 share of Delores’ residence which was in addition to the 1/4 share he had previously received from Delores’ residual estate. On August 2, 2007, plaintiff and his brother Scott filed a complaint against attorney Connell claiming malpractice in the preparation of the second Will. Plaintiff also sued his attorney in the initial suit claiming that he failed to advise plaintiff that he had a viable claim for malpractice against Connell. The malpractice action was dismissed on summary judgment based on estoppel, statute of limitations, unclean hands and failure to establish damages. Plaintiff appealed.
To establish legal malpractice, a plaintiff must show:
- the existence of an attorney-client relationship creating a duty of care upon the attorney;
- the breach of that duty; and
- proximate causation.
An attorney preparing a will owes a duty only to the testator, unless the attorney undertook a duty to the beneficiary. Also, an attorney owes no duty of care to a potential beneficiary if a beneficiary’s interest is adversarial to the interest of the estate and contrary to the will of the testator.
Based on the foregoing, the Appellate Division held that attorney Connell owed no duty to plaintiff because he represented Delores with respect to preparing the second Will, not the plaintiff. In addition, attorney Connell owed no duty to plaintiff as he took an adversarial position against the estate. Note: plaintiff did not seek to have the second Will set aside.
Palimony Claims – Prospective Application of Statute of Frauds
Botis v. Estate of Gary G. Kudrick, 2011 N.J. Super LEXIS 76 (Docket No.: A-5562-09T4) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Monmouth County.
This case required the Appellate Division to determine whether to retroactively apply the amendment to the Statute of Frauds requiring palimony agreements to be in writing and for each party to be represented by separate counsel. The Court held that the amendment applies prospectively, thereby allowing a palimony claim filed against the Decedent’s estate prior to the effective date of the amendment on an alleged agreement enforceable when the complaint was filed to proceed against the Decedent’s estate.
In her complaint, Plaintiff alleged that she and Decedent lived in a marital-type relationship for over 30 years, that they purchased real property together, and that Decedent promised to provide for her at his death. Prior to the enactment of the statute, such a claim was cognizable under the common law. Decedent passed and his Will failed to provide for Plaintiff. She sued the Estate seeking palimony. The trial court failed to retroactively apply the amendment to the statute of frauds, and defendant estate appealed.
In affirming the trial court’s decision not to apply the amendment retroactively, the Appellate Court found significant the fact that the parties were simply unable to comply with the requirements of the amendment prior to its enactment. In this case, Decedent had died over a year and a half before its enactment and Plaintiff filed her Complaint almost a year before enactment. Decedent was simply unable to comply with the new statutory requirements, and prior to the amendment, case law supported a mutual expectation that the palimony agreement was enforceable without a writing executed after consultation with an attorney.
Palimony Claims – Prospective Application of Statute of Frauds
Pierson v. the Estate of Christopher Dahl, 2011 N.J. Super. Unpub. _____ (Docket No.: A-5997-09T4) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Atlantic County.
The Appellate Division, relying on its decision in Botis v. Kudrick, 2011 N.J. Super LEXIS 76 (App. Div. 2011), reversed the trial court’s dismissal of Plaintiff’s palimony claim which had been filed before the effective date of the amendment to the Statute of Frauds requiring palimony agreements to be in writing.
In Botis, the Court held that the statutory amendment should not be given retroactive effect to dismiss palimony suits that were filed and pending before the date of enactment.
Disinterment –Decedent’s Mother Has No Right to Force Disinterment on Daughter’s Surviving Spouse
In the Matter of the Estate of Peggy X. Puder, Deceased, 2011 N.J. Super. Unpub. ____ (Docket No.: A-1639-09T3) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Bergen County. Before Judges Carchman, Graves and Waugh.
Decedent’s mother appealed from the lower court’s denial of her right to force Decedent’s spouse to return Decedent’s remains to their original resting place. Decedent’s spouse moved Decedent’s remains after she was buried.
Decedent’s mother claimed that her daughter had come to her to ask that she take care of her burial arrangements, but she never placed her intentions in writing. In fact, there were conflicting accounts of Decedent’s intentions.
Under the disinterment statute (NJSA 45:27-23(a)), if the person does not otherwise specify in writing, the decision is left to the surviving spouse. The surviving spouse, adult children and owner of the disinterment space have authority to authorize remains to be moved. There are no notice requirements and Decedent’s mother lacks standing on the merits as she is not a “stakeholder” under the statute.
Within a week of the lower court’s decision, the Supreme Court decided Marino v. Marino, 200 N.J. 315 (2009), requiring the court to consider the interment and disinterment statutes separately in rendering its opinion. Specifically, in a case involving a dispute between a surviving spouse and adult children of the Decedent, the authority to disinter is not vested in the surviving spouse alone, but vested in the surviving spouse, adult children and owner of the interment space who must give their authorization jointly and in writing. The lower court distinguished the within matter from Marino since all of the parties required to sign off on the disinterment have signed off. This did not include authorization from Decedent’s mother. Only in cases where there is a dispute between stakeholders, i.e. dispute between surviving spouse and adult children, will Decedent’s intentions be considered. The Appellate Division therefore affirmed the lower court’s dismissal of Plaintiff’s Complaint.
Divorce – Enforcement of Decedent’s Obligation to Maintain Life Insurance
In the Matter of the Estate of John P. Boyle, Deceased, 2011 N.J. Super. Unpub. ____ (Docket No.: A-3338-09T2) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Monmouth County. Before Judges Axelrad, R. B. Coleman and Lihotz.
This appeal was taken from the lower court’s order requiring the Estate to pay to Decedent’s unemancipated son an amount of $250,000 in recognition of Decedent’s obligation to maintain life insurance for his son under the Judgment of Divorce between Decedent and his ex-wife.
The Estate appealed. The Appellate Court upheld the lower court’s finding that the Judgment of Divorce was clear in its terms that the insurance was required to be maintained until Decedent’s son was emancipated. He remained in college and therefore the obligation continued. There was also no provision requiring a step down in the required amount of insurance as the child support obligation decreased over the years.
Divorce – Proper Forum
In the Matter of the Estate of John Kokinakos, 2011 N.J. Super. Unpub. ____ (Docket No.: A-2103-10T4) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Monmouth County. Before Judges J. N. Harris and Fasciale.
This involves the question of the proper forum for resolving post-divorce equitable disputes involving an insolvent estate. The lower court dismissed plaintiff executor’s declaratory judgment complaint seeking to transfer all matrimonial matters to the Probate Part. The Appellate Division affirmed, holding the matter is properly brought in the Family Part.
Decedent and his wife were divorced by final judgment entered on August 18, 2009, which incorporated the parties Divorce Settlement Agreement. As part of that agreement, decedent agreed to execute a Will providing for bequests to his ex-wife and children to secure his alimony and child support obligations. Although a Will was drafted for his review, decedent failed to execute the Will.
Decedent passed on November 1, 2009, and Peter Kokinakos qualified as administrator of his estate. Decedent’s ex-wife filed a complaint in the Family Part seeking to join the estate as a party to the matrimonial action, and demanding payment under the Divorce Settlement Agreement. The Family Part granted the motion, adding the Estate as a party and ordering payment. The Family Part also directed the parties to file a motion in either the Family Part or Probate Part to determine jurisdiction.
On September 24, 2010, decedent’s administrator filed a complaint in the Probate Part seeking an order requiring all future proceedings involving the estate to be conducted in the Probate Part. The Probate judge dismissed the action and an appeal was taken.
Citing In re Estate of Roccamonte, 174 N.J. 381 (2002), the Appellate Division held that the Probate Part was not an appropriate forum to deal with the parties’ family-type claims. Instead, the matter should be brought in the family part. The Appellate Division also noted that the administrator failed to bring an action for insolvency in the Probate Part, which could have prevented the transfer of the matter back to the Family Part.
Attempted Removal of Administrator
In the Matter of the Estate of Jason Marles, 2011 N.J. Super. Unpub. ____ (Docket No.: A-3549-10T3) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Ocean County. Before Messano and Yannotti.
Decedent’s ex-wife appeals from the lower court’s denial of her Complaint seeking to have Decedent’s mother removed as administrator as prosequendum of Decedent’s Estate. Decedent and his ex-wife had 2 children. They were divorced in 2009 and in the marital settlement agreement, Decedent’s ex-wife waived the right to administer his estate.
In 2010, Decedent was involved in a car accident which resulted in his death. Decedent died without a will. Decedent’s ex-wife, and Decedent’s mother met with an attorney and agreed to file a wrongful death suit. Decedent’s mother wanted to be appointed administratrix and Decedent’s ex-wife signed a renunciation in her favor. Letters were issued to Decedent’s mother by the Surrogate. Subsequent to her appointment, Decedent’s ex-wife had an argument with Decedent’s mother, and hired her own attorney. A Complaint was filed seeking to have Decedent’s ex-wife appointed as administratrix ad prosequendum as Decedent’s two children were the sole heirs of the Estate. This was opposed by Decedent’s mother.
The trial court found that the marital settlement agreement precluded Decedent’s ex-wife from acting as administratrix ad prosequendum, and an appeal was taken. On appeal, the Appellate Division upheld this decision, finding that the trial court was authorized to allow Decedent’s mother to continue as administratrix of the estate. The court also cited the potential conflict faced by Decedent’s ex-wife who was exploring a claim based on a reconciliation between her and the Decedent, which would potentially conflict with the rights of Decedent’s children.
Attempted Removal of Co-Executor for Breach of Fiduciary Duty
In the Matter of the Estate of Albert Sauer, 2011 N.J. Super. Unpub. ____ (Docket No.: BER-P-088-11) (Ch. Div. 2011). Decision by the Superior Court of New Jersey, Chancery Division, Bergen County.
An order to show cause and complaint was filed by plaintiff, co-executrix of the Estate, seeking removal of her sister, as co-executrix for failure to account and breach of fiduciary duty for failure to include plaintiff in estate administration decisions and the payment of bills on behalf of the estate.
In this matter, defendant, a co-executrix, acted unilaterally pertaining to the administration of her father’s estate, despite having been appointed as a co-executrix with her sister, the plaintiff herein. Plaintiff sought information and documents and to be included in each decision pertaining to the estate, including paying bills. Defendant refused, instead providing information to plaintiff after decisions and payments were made. There was a guardianship action between the parties prior to decedent’s death, which muddied the waters between the parties.
Defendant also paid her attorney but refused to authorize payment for plaintiff’s attorney. Defendant utilized monies in a joint account established before decedent’s death to pay the bills and refused to transfer the monies into an estate account which would have necessitated a signature on each check by the plaintiff. Numerous letters between counsel were exchanged to no avail. Plaintiff then decided to file the complaint.
The Court held that defendant would not be removed so long as she involved plaintiff in all of the decisions pertaining to the estate, including the signing of any checks. Defendant had the obligation to include plaintiff in each decision as co-executrix. The Court also found that unless plaintiff’s counsel was also paid, that defendant’s attorney would need to disgorge the attorneys’ fees paid to him from the estate until such time as they agreed to pay both attorneys. Each executrix was entitled to hire counsel who should be paid. The matter as to the accounting and misappropriation of funds was allowed to move forward and a case management conference was scheduled.
Buy-out of Partnership Interest
Estate of Claudia L. Cohen v. Booth Computers and James S. Cohen, 2011 N.J. Super. Unpub. ____ (Docket No.: A-0319-09T2) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Bergen County. Before Judges Carchman, Graves and St. John.
Plaintiff appeals from the trial court’s enforcement of a buy-out of a deceased partner’s share in a family limited partnership (FLP) at book value in accordance with the partnership agreement, despite the significant disparity between book value and market value. On appeal, the Appellate Division held that the formula utilized in computing net book value was appropriate, the buyout agreement was enforceable, and the disparity between book value and market value did not render the agreement unconscionable.
In 1978, decedent’s father established a partnership owned by her and her two (2) brothers. Decedent’s father placed a residence in Palm Beach County, Florida and two (2) commercial buildings in New Jersey into the partnership. The partnership agreement contained typical buy-sell provisions preventing the transfer of shares to third parties, and also provided that upon the death of a partner, their shares were required to be sold and bought by the remaining partners for an amount equal to their proportionate share of book value, plus $50,000. At the time of decedent’s death, the real estate held by the partnership was worth in excess of $32.0 million, while book value was approximately $240,000.
When offered the buy-out of $178,000 by the partnership, decedent’s executor asked for financial documentation to justify this figure, when decedent’s interest at fair market value was valued at $11.0 million. Some documentation was produced. The trial court, relying on the language in the partnership agreement, and citing the fact that one of the siblings was bought out at book value ten years ago, without objection, ruled that the partnership agreement should control. Plaintiff also argued that this result rendered the buy-out provision unconscionable. The court disagreed, finding that the parties could have negotiated a better deal and this arrangement in the partnership agreement was not unusual in the family context to avoid litigation. This decision was upheld on appeal. The language in the agreement was not ambiguous and nothing in the law or the agreement required that the buy-out occur at fair market value.
Distributions
In the Matter of the Estate of Gerald Russomano, 2011 N.J. Super. Unpub. ____ (Docket No.: A-1213-10T3) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Monmouth County. Before Judges Reisner and Simonelli.
Plaintiff beneficiary appeals the lower Court’s denial of his application requiring the estate of his late father to sell him a piece of property where his business is located and the Court’s order evicting him from the property.
Decedent’s Will devised his garage business to his son, but he left the underlying property in Long Branch, NJ where the business was located to his wife and three children. After Decedent’s death, a lease was entered into with the estate, allowing for the business to continue. At a point that the lease expired and the plaintiff son was in default under the lease for failure to pay taxes, the executrix of the estate filed an eviction action. The plaintiff son filed a Complaint in the Probate Part seeking to compel the Estate to sell him the underlying land. The matters were consolidated in the Probate Part for disposition.
In an oral opinion from the bench, the lower Court found that plaintiff son’s failure to pay real estate taxes justified his eviction from the property. The Court also found that plaintiff son failed to properly exercise the purchase option under the lease requiring him to pay cash at closing, as plaintiff son sought a transfer in exchange for giving the estate back a mortgage, which was unacceptable to the estate.
On appeal, plaintiff son claimed the executrix lacked standing. This was rejected, with the Appellate Division upheld the lower Court’s decision, as plaintiff son was not a ready, willing and able buyer.
Mortgage Lien
Garruto v. Cannici, 2011 N.J. Super. Unpub. ____ (Docket No.: A-5639-09T1) (App. Div. 2011). On appeal from the Superior Court of New Jersey, Chancery Division,OceanCounty. Before Judges Carchman and St. John.
Plaintiff loaned the decedent, his sister, some money in 1979. A mortgage was given on real property owned by the decedent which was due and payable in 1994. Upon decedent’s demise, plaintiff and his brother filed a claim for tortious interference with rights of inheritance which was ultimately dismissed on summary judgment. Years later, plaintiff sought payment on the mortgage. The trial court dismissed this claim as barred by the relevant statute of limitation. The court also noted that the plaintiff failed to make a claim for payment of the mortgage during the underlying probate litigation.
On appeal, the Appellate Division upheld the dismissal of the claim. The plaintiff failed to establish that there was a modification of the mortgage and the claim was therefore barred by the statute of limitations.
Collection of Judgment Against Debtor’s Inheritance
In the Matter of the Estate of Norton D. Smith, deceased, 2010 N.J. Super. Unpub. ____ (Docket No.: A-4137-08T3) (App. Div. 2010). On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Monmouth County. Before Judges Graves and Sabatino.
The appeal arises out of a judgment creditor’s attempt to collect a debt from debtor, by attaching sums due debtor from Decedent’s estate as beneficiary.
Judgment was entered against debtor for failure to pay rent. Decedent’s son was appointed as administrator of the estate, sold Decedent’s residence and made partial distributions. Creditor sued the estate for the distribution made to debtor. The probate court dismissed the action taking the estate’s Answer on its face that debtor was owed nothing from the estate. Creditor appealed, claiming that the court should allow discovery on whether debtor in fact is owed monies as beneficiary of the estate, in light of the court’s ability to allow creditor to levy on the beneficiary’s share in certain situations.
The appellate court reversed, finding questions of fact over whether debtor was owed any monies from the estate as beneficiary. If so, creditor had the ability to attach the monies due debtor from the estate.
Distributions
In the Matter of the Estate of Frank Leonard, deceased, 2010 N.J. Super. Unpub. ____ (Docket No.: A-6403-08T3) (App. Div. 2010). On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Sussex County. Before Judges Gilroy and Simonelli.
This appeal arises out of a dispute between Decedent’s second wife and his children from a prior marriage pertaining to the second wife’s handling of the Decedent’s residence, which was held in trust, and the failure to distribute personal property which was owned by Decedent’s first wife to his children pursuant to his will.
Decedent’s first wife predeceased him. They had seven children. Decedent then married his second wife, Elizabeth. In his Will, he directed that his residence in Branchville, New Jersey be shared by Elizabeth and his children, and he devised his first wife’s personal property to his children.
Elizabeth refused to probate the will. After an action was filed by Decedent’s children, the court compelled her to probate the will. Decedent’s children also sought access to the residence to remove their mother’s personal property, and to compel sale of the residence as Elizabeth refused to allow for equal access to the premises. Elizabeth claimed she was entitled to exclusive use of the property during her life.
Applying equity, the court carved out a monthly window when Elizabeth had exclusive rights to the property.
The court also denied the children’s request for a turnover of their mother’s personal property based on laches and the entire controversy doctrine. The appellate court reversed in part, finding that Elizabeth did not object to the children’s rights to the personal property and would not be harmed by the turnover of the items to Decedent’s children.
Divorce – Estate’s Claim for Diversion of Marital Assets
Kay v. Kay, 200 N.J. 551 (2010).
This appeal was taken from the lower court’s dismissal of the underlying divorce action between Decedent and his spouse. The estate claimed that the divorce action should continue to determine the rights to certain property which they claim were diverted by the Decedent’s spouse during their marriage, for ultimate disposition under his will.
In upholding the Appellate Division, the New Jersey Supreme Court held that a trial court must consider the equitable claims raised by the estate of a deceased spouse who, during the divorce litigation, was attempting to pursue a claim that the surviving spouse had diverted marital assets. Permitting the estate the opportunity to pursue its claim for relief in the underlying divorce action after the Decedent’s death would promote equity and fair dealing between spouses.
The estate may continue the divorce action for the limited purpose of proving that marital assets were diverted by the surviving spouse, because equity demands that the innocent spouse have a forum to recover those assets in equitable distribution for payment to the deceased spouse’s rightful heirs and to prevent unjust enrichment.
Forced Insolvency
In the Matter of the Estate of David B. Madden, deceased, 2010 N.J. Super. Unpub. ____ (Docket No.: A-5673-08T3) (App. Div. 2010). On appeal from the Superior Court of New Jersey, Chancery Division, Sussex County. Before Judges Carchman, Lihotz and Ashrafi.
Plaintiff alleged that Decedent engaged in a series of fraudulent transactions with his wife which resulted in an insolvent estate, depriving plaintiff of the ability to collect on a judgment he had against Decedent. The trial court found that plaintiff failed to sustain his burden of proof, which was upheld on appeal.
Plaintiff and Decedent were friends and engaged in business transactions with each other. Decedent borrowed money from plaintiff in 2003 for an investment in an insurance company, which was evidenced by a note. Decedent ran the insurance company until his death. In 2000, Decedent was diagnosed with prostate cancer and established an estate plan by placing sufficient assets in his wife’s name to take care of the credit shelter trust provisions under their wills. Decedent held real estate as joint tenants which he ultimately distributed to his wife before his death. Decedent died on November 12, 2003 and his wife was appointed as executrix.
Decedent also had an interest in two leases, which are the subject of the appeal. Decedent subleased the premises to Boston Chicken, in which Decedent received approximately $40,000 per year in excess to the lease payments due the landlord. The lease was transferred by Decedent to his wife. Also, the insurance company filed for bankruptcy after Decedent’s death. Plaintiff filed suit against the estate seeking to undo certain pre-death transfers of Decedent.
The court ruled that the actions of Decedent and defendant did not amount to a fraud to avoid a creditor, merely actions to protect their family through proper estate planning. Decedent was permitted to assign the sublease to defendant, and plaintiff failed to prove that the pre-death transfers were an intention by the Decedent to avoid payment on the note, as Decedent still held shares in the insurance company which he intended to sell to satisfy the note. Also, there was still value in the insurance company which the parties agreed was intended to fund the buy-out of the note.
Forced Sale to Pay Expenses
In the Matter of the Estate of Anthony J. Napoleon, deceased, 2010 N.J. Super. Unpub. ____ (Docket Nos.: A-0919-09T2 and A-1087-09T2) (App. Div. 2010). On appeal from the Superior Court of New Jersey, Chancery Division, Ocean County. Before Judges Axelrad, Fisher and Espinosa.
This appeal was taken from the lower court’s order compelling the sale of a condominium owned by the estate to provide the illiquid estate with necessary funds to address various obligations. It was consolidated with an appeal from the prior co-administrator from the lower court’s order imposing sanctions for violation of the court’s oral proclamation imposing unspecified restraints on estate distributions. The appellate division upheld the order compelling the sale of the condominium but overturned the order imposing sanctions, finding lack of adequate specificity in the court’s attempt to impose restraints on distributions.
Legal Malpractice Claim Not Barred by the Entire Controversy Doctrine
Higgins and Calcaterra v. Thurber and ThurberCappell, LLC, 413 N.J. Super. 1 (App. Div. 2010). On appeal from the Superior Court of New Jersey, Law Division, Morris County. Before Judges Axelrad, Fisher and Sapp-Peterson.
This case involved a claim of malpractice filed by the beneficiaries of the estate against the attorneys for the executor of the estate.
The attorney and firm were hired by the executor to set aside certain questionable transfers of NY Mercantile Exchange Seats owned by the Decedent which were transferred to his daughter prior to his death. An initial hourly retainer was signed, and, when the estate could not pay, the retainer was modified to a contingency arrangement.
At trial, the court ruled that certain Mercantile Exchange seats should be transferred back to the estate. An appeal was taken. Prior to disposition of the appeal, another suit was filed seeking to have the executor removed due to misconduct and to hold the guardian ad litem liable for misconduct. The Court denied the request and ordered a formal accounting. The executor filed a complaint seeking to have his accounting approved. While the formal accounting was pending, another suit was filed seeking damages against the executor for breach of fiduciary duty and claiming that the attorneys for the estate committed malpractice. Exceptions were filed in the accounting action which were highly critical of the services rendered by defendant-attorneys. The defendant-attorneys intervened in the accounting action and the court ultimately dismissed the claims against them without prejudice.
The within complaint was then filed by beneficiaries of the estate against defendant-attorneys claiming legal malpractice, breach of contract, breach of covenant of good faith and fair dealing and excessive fees. The defendant attorneys moved to dismiss the action based on the entire controversy doctrine and the statute of limitations, and the court agreed.
On appeal, the court rejected the application of the entire controversy doctrine to bar the malpractice claim, despite the numerous law suits over a 13 year period, as it was not clear from the record that the beneficiaries were given a full and fair opportunity to prosecute their claim in the formal accounting action. The matter was remanded on this issue and the issue of the application of the 6 year statute of limitations as it was unclear when the limitation period began.
Surety Bond
Wisnewski v. Travelers Casualty and Surety Company, et al<., 2010 U.S. App. LEXIS 15468 (3rd Cir. 2010). On appeal from the United States District Court for the District of New Jersey.
The lower court dismissed plaintiff’s complaint which sought payment from the executor’s surety company based on the entire controversy doctrine. The Appellate Court agreed, holding that plaintiff’s underlying claims against the surety company involved issues already litigated and disposed of by the Superior Court of New Jersey, Chancery Division, probate part. In addition, the Executors underlying account was approved by the Court in this intestacy action, and plaintiff had signed a refunding bond and release. The Executor and the surety bond were discharged by order of the probate court. The within matter seeking to reopen claims regarding the disposition of Decedent’s assets was therefore barred by the entire controversy doctrine.
Disinterment – Decedent’s Wishes Given Consideration
Hiller v. WashingtonCemetery, et al., 2010 N.J. Super. Unpub. LEXIS 299 (Docket No.: A-2510-08T1) (App. Div. 2010). Before Judges Lisa and Coburn.
The Appellate Division upheld the lower court’s holding allowing for the body of Decedent to be exhumed from the grave site where he was buried for the purpose of having him cremated based on Decedent’s expressed written intentions.
Decedent was buried by his brother, an Orthodox Jew, the morning after his death, despite Decedent’s clear written intentions to be cremated. A law suit was filed by Decedent’s girlfriend seeking to have his body disinterred and cremated. Decedent had expressed his intentions in a letter and in a written will.
Under Marino v. Marino, the court may consider the Decedent’s wishes in dealing with the issue of disinterment. Here, the Decedent’s intentions were clear and the court was entitled to strike the balance in favor of Decedent’s clear preference. Decedent’s girlfriend was given authorization to have the body exhumed and the Decedent’s body cremated. Decedent’s brother was also ordered to pay for the costs of exhuming the body and the cremation.
Evidence – Trustworthy Statements by Deceased Declarant
Estate of Nick Hanges v. Metropolitan Property & Casualty Insurance Company, 2010 N.J. Super. Unpub. ____ (Docket No.: A-62-09) (App. Div. 2010). New Jersey Supreme Court.
This matter involved the lower court’s exclusion of statements made by the Decedent to the police concerning the cause of his automobile accident on summary judgment. On appeal, the appellate court concluded that the statement to the police was admissible under N.J.R.E. 804(b)(6) (Trustworthy Statements by Deceased Declarants).
After an accident, Decedent stated that he was cut off by a “phantom vehicle”, a blue corvette, forcing him to crash. He was transported to the hospital where he made the same statement. He was discharged and an accident claim was made, with no mention that Decedent was cut off. A few months later Decedent committed suicide.
The issue was whether Decedent’s statement was admissible as an exception to the hearsay rule. NJRE 804(b)(6) codifies an exception to the hearsay rule in civil proceedings admitting “a statement made by a person unavailable as a witness because of death if the statement was made in good faith upon declarant’s personal knowledge in circumstances indicating that it is trustworthy.”
The trial court concluded that the statement by the Decedent was inadmissible because it was an attempt to shift responsibility for the accident to a “phantom vehicle.” The Decedent had much to gain by the statement and had no duty to be truthful.
The Appellate Division held that the statement was admissible as there was nothing in the record to indicate that the statement was not made in good faith or that it was otherwise lacking in reliability or untrustworthiness. The Supreme Court agreed.
Insolvent Estate – Priority of Claims in Foreclosure Action
Investors Savings Bank v. Gloria and Steven Sitzman, as Administrator of the state of Peter Sitzman, deceased, 2010 N.J. Super. Unpub. ____ (Docket No.: A-183-08T2) (App. Div. 2010). On appeal from the Superior Court of New Jersey, Chancery Division, Sussex County. Before Judges Grall and Messano.
Decedent passed away owning real estate encumbered by a mortgage. The Decedent’s parents were appointed as co-administrators of the estate. The Decedent’s only asset was a residence worth $210,000, with a mortgage lien of $262,000. On Decedent’s death, a foreclosure action was filed by the bank seeking the return of Decedent’s real estate. The co-administrators filed an action in surrogate’s court seeking to declare the estate insolvent, and to allow for them to sell the Decedent’s residence and pay funeral bills and administration expenses out of the proceeds of sale before turning the remainder over to the bank. The bank filed summary judgment. Denying the co-administrators’ request, the court ruled that the priority scheme of N.J.S.A. 3B:22-2 did not apply because the residence was not an asset of the estate, only Decedent’s equity in light of the mortgage was an asset of the estate. Since the value of the mortgage was well in excess of the value of the property, the bank’s summary judgment request seeking to consolidate the matter with the foreclosure matter was granted. This decision was upheld on appeal.
Legal Malpractice – Statute of Limitations
Pasqua v. Masone, 2010 N.J. Super. Unpub. _____ (Docket No. A-3617-08T3) (App. Div. 2010). On appeal from the Superior Court of New Jersey, Law Division, Essex County. Before Judges Rodriguez, Yannotti and Chambers.
A legal malpractice case was filed by Vincent Pasqua (“Vincent”) against Michael Masone, Esq. (“Masone”) seeking damages for preparing a Will, Trust and Power of Attorney on behalf of his mother, Madeline Pasqua (“Madeline”), for conflict of interest and failure to investigate Decedent’s health issues. Masone had been contacted by his stock broker, Andrew Pasqua (“Andrew”), Vincent’s brother, to file a tort claim on behalf of Madeline, and then to prepare estate planning documents on her behalf. As a result, there was a change in disposition which increased Andrew’s share of the Estate. On January 8, 1999, Madeline filed a Complaint against Andrew alleging breach of fiduciary duty and conversion. Madeline died on June 10, 1999.
On November 8, 1999, Andrew filed a Complaint seeking to admit the Will prepared by Masone to probate. Vincent filed objections. On January 24, 2002, Masone was deposed. The litigation culminated in a trial before Judge Weeks, who rendered a decision on February 9, 2006, setting aside the Will and Trust prepared by Masone and appointing Vincent as the administrator.
On February 5, 2008, Vincent sued Masone on behalf of the estate for legal malpractice. Masone moved for summary judgment arguing that the action was barred by the 6 year statute of limitations. The trial court agreed and the matter was dismissed, finding that the malpractice action accrued the latest at Masone’s deposition on January 24, 2002, finding that the knowledge required under the discovery rule either existed or should have existed after the deposition. By that date, Vincent had actual injury and knowledge of fault. The trial court’s decision was upheld on appeal.
Palimony Claims – Lack of Jurisdiction
In re Estate of Robert M. Figlio, deceased, 2010 N.J. Super. Unpub. LEXIS 665 (Docket No. A-3545-08T3) (App. Div. 2010). On appeal from the Superior Court of New Jersey, Chancery Division, Probate Part, Salem County. Before Judges Baxter and Alvarez.
This matter involved an appeal of the lower court’s dismissal of a potential palimony claim against the Estate which was overturned on appeal as the plaintiff was not named as an interested party or give notice of the underlying probate complaint.
Decedent and his wife were married in 1968. After Decedent’s demise in March of 2008, Decedent’s wife filed an Order to Show Cause and Complaint to probate a holographic Will allegedly signed by the Decedent in 1972 which left his wife his entire estate. Decedent’s wife did not name Plaintiff, who allegedly had a marital type relationship with Decedent, as an interested party. Prior to the return date, Plaintiff sent a letter to counsel for the Estate regarding her potential palimony claim against the Estate. This letter was sent to the Court by counsel for the Estate. Plaintiff also filed a Certification with the Court detailing her relationship with the Decedent. Although counsel and the Court were aware of the claim, Plaintiff was never served with a copy of the Complaint, and therefore no responsive pleadings were filed. After a hearing, the trial Court dismissed Plaintiff’s potential palimony claim and admitted the holographic Will to probate.
On appeal, the appellate court held that since Plaintiff was not named as an interested party, and was not served with the underlying probate Complaint, her rights could not be adjudicated as the Court lacked jurisdiction over her claim. Even if the Probate Part had the authority to decide such a claim, Plaintiff presented sufficient facts to survive the motion for dismissal of her palimony claim. The order dismissing the matter was reversed, and Plaintiff authorized to assert a palimony claim in the Family Part for proper adjudication.
Beneficiary Liability – Environmental Clean-up
Pries v. Hugin, et al., 2009 N.J. Super. Unpub. LEXIS 2967 (Docket No.: A-4559-07T3) (App. Div. 2009). Before Judges R. B. Coleman and Simonelli.
Issue: Are the heirs of an estate liable to plaintiff as owners of the property from which raw sewage flowed onto the plaintiff’s property?
Holding: No. The property in question is still owned by the Estate and therefore, the beneficiaries of the Estate owed no duty to the adjoining landowner for a broken sewer line causing plaintiff damage. The motion for summary judgment granted by the trial Court was therefore affirmed.
While the beneficiaries of an estate became the owners of the property at Decedent’s death pursuant to the terms of the Will, title remain vested in the Estate until a Deed transfer is made. The Executrix has the right pursuant to statute to possess and control the property, not the beneficiaries. The duty to plaintiff, if any, is owed by the Executrix of the Estate, who manages and controls the property in question pursuant to N.J.S.A. 3B:10-29, not the beneficiaries.
Disinterment
Marino v. Marino, 200 N.J. 315 (2009). Before the New Jersey Supreme Court.
Issue: Do the statutory provisions that authorize a surviving spouse with the authority to designate a place of interment, absent a contrary written declaration, also give the spouse the exclusive right to demand disinterment notwithstanding statutory language to the contrary?
Holding: No. There are clear differences between the provisions of the Cemetery Act (N.J.S.A. 45:27-1, et seq.) governing interment and disinterment. Under the statute, there is a strong preference against disinterment. Unlike the statutory provisions governing interment where the surviving spouse is given exclusive authority over where to bury Decedent’s remains, the surviving spouse is not given the right to disinter alone, as it must be authorized by the spouse, adult children and the owner of the cemetery.
This matter involved a dispute between Decedent’s surviving spouse and his adult children as to where the Decedent should be buried. Decedent did not place any preference in writing in his Will or otherwise. Upon Decedent’s death, Decedent was buried by his adult children, and the surviving spouse was strong armed into acquiescing. She then brought suit seeking to disinter Decedent’s body to a new burial site, where she claimed he wanted to be buried. After a hearing, the trial Court found that Decedent had a preference to be buried next to his father’s remains, and not at the site advanced by his surviving spouse. In its decision, the trial Court upheld Decedent’s wishes as it perceived them from the testimony presented at the hearing..
Under the Cemetery act, a Decedent’s written expression of intent controls. In default, the right to control funeral and disposition of the remains shall be in the following order: (1) the surviving spouse, then (2) the majority of surviving adult children. Under the Cemetery Act, orally expressed wishes of the Decedent are no longer binding and the surviving spouse may select the burial site. The trial Court found that the children violated the statute as the surviving spouse was given preference.
On appeal to the Appellate Division, it was argued that the Decedent’s orally expressed wishes as to the burial site should control. The Court found that the trial Court should not have considered the hearsay testimony as to Decedent’s intentions as the statute controlled. The Appellate Division found that the statutory provisions governing interment and disinterment should be read in para materia (together), and the preferences of the surviving spouse should be given the greatest consideration.
The matter was appealed to the Supreme Court, which found that the statutory provisions governing interment and disinterment have a different regulatory scheme and cannot be read together. Although the surviving spouse is given the right to choose where her husband is interred, she did not have the exclusive right to disinter. The Court refused to move the body as the statute required the adult children to also authorize the disinterment. The Court also noted that the language of the disinterment statute expresses a preference against disinterment and the surviving spouse’s wishes are not paramount, as they must be considered in light of the wishes of the Decedent and his adult children.
Divorce – Constructive Trust
Estate of Bernard Ritterman v. Cecile Ritterman, 2009 N.J. Super. Unpub. LEXIS 829 (Docket No.: A-3720-07T3) (App. Div. 2009). Before Judges Axelrad and Messano.
Issue: Should a constructive trust be imposed over monies received by Decedent’s wife after Decedent’s death in a sale of their marital home in light of the divorce proceedings between the parties which were ongoing at Decedent’s death?
Holding: No. A divorce decree had yet to be entered and although negotiations were ongoing, the lower Court failed to find extraordinary circumstances to formalize the divorce between the parties. While negotiating a settlement, the wife signed a Deed in favor of her husband to the marital residence. The record is clear that there was no firm agreement respecting equitable distribution of the marital home prior to husband’s death. In fact, the Deed was held in escrow pending resolution of the final issues. The wife never received the buy-out of her share and the terms of a consent order were still being negotiated when the husband died. On behalf of his estate, the husband’s two adult children sought ratification of the divorce, which was denied.
Entire Controversy Doctrine – Contested Administration
The Estate of Elyree Smiley and George Gibson v. Brenda McElnea, Esq., 2009 N.J. Super. Unpub. LEXIS 2729 (App. Div. 2009). Before Judges J.N. Harris and Newman.
Issue: Does the Entire Controversy Doctrine apply to bar a subsequent suit filed against a temporary administrator of the estate appointed during the pendency of a Will contest based on claims already adjudicated by the probate Court?
Holding: Yes. Plaintiff’s suit questioning Defendant’s handling of the administration of the Estate was properly dismissed through application of the Entire Controversy Doctrine. This was Plaintiff’s fourth suit against the temporary administrator dealing with the same issues and was therefore properly dismissed.
Plaintiff claimed he was unable to litigate all issues in front of the probate Court in the prior proceedings, but he failed to file an appeal.
The Entire Controversy Doctrine requires litigants in a civil action to raise all affirmative claims arising from a single controversy that each party might have against another party, including counterclaims and cross-claims. The central consideration is whether the claims against the different parties arise from related facts or the same transaction or series of transactions. Although it is designed to promote efficiency, it cannot be used as an inequitable sword against a litigant.
All of the claims raised by Plaintiff in his new suit were well within the factual matrix that was litigated to conclusion in the prior suit. In addition, Plaintiff’s pro se status does not allow for him to avoid the rules promulgated by the Supreme Court to guarantee an orderly process.
Intestacy – Void Second Marriage
In re Estate of Augustin Ngwe Mandeng, deceased, 2009 N.J. Super. Unpub. LEXIS 407 (Docket No. A-2143-07T3) (App. Div. 2009). Before Judges Reisner, Sapp-Peterson and Alvarez.
Issue: Is Decedent’s spouse equitably estopped from challenging the validity of a Cameroonian divorce and second marriage under Heuer v. Heuer, 152 N.J. 226, 704 A.2d 913 (1998) in order to establish her intestate share of the estate of her husband who had allegedly remarried?
Holding: No, Decedent’s spouse is not prevented from challenging the validity of the Cameroonian divorce and second marriage under Heuer as she was unaware of its existence. The lower Court also found that the Cameroonian divorce decree was a fraud based on evidence presented at a summary judgment motion hearing. The validity of the first marriage was undisputed, making the second marriage null and void. Therefore, Decedent’s first spouse was entitled to receive distribution of the Estate under the New Jersey intestacy statutes.
The Court also found that the elective share statute does not apply in situations where an individual dies without a will. Instead, the intestacy statute applies and the statute does not require Decedent’s spouse to reside with him at the time of death in order to inherit. See N.J.S.A. 3B:5-3.
Settlement – Funeral Expenses
In re Estate of Marilyn Varcadipane, deceased, 2009 N.J. Super. Unpub. LEXIS 572 (Docket No. A-5130-07T3) (App. Div. 2009). Before Judges Fisher and King.
Issue: Is an estate required to reimburse the funeral and burial expenses paid by a party to a settlement in light of the global settlement entered into between the parties which did not specifically mention such expenses?
Holding: The Court remanded the matter for further proceedings to determine whether the parties had entered into an agreement as to the reimbursement of these expenses as part of the global settlement between them.
The aggrieved party claimed that Decedent entered into an oral agreement with him whereby Decedent agreed to pay him for caring for her and for expending monies on her behalf. A global settlement was entered between the parties. Thereafter, an accounting was filed by the Executor of the Estate and a claim was made by the aggrieved party for payment of expenses which he made on Decedent’s behalf both before and after her death. The Court held that the payments which were made before Decedent’s death were covered by the global settlement and remanded to the trial Court to decide whether the funeral and burial expenses were also covered by the agreement.
In reviewing a settlement, the Court is required to “strain to give effect to the terms of a settlement wherever possible,” and that “any action which would have the effect of vitiating the provisions of a particular settlement agreement and the concomitant effect of undermining public confidence in the settlement process in general, should not be countenanced.” Dep’t of Pub. Advocate v. N.J. Bd. Of Pub. Util., 206 N.J. Super. 523, 503 A.2d 331 (App. Div. 1985). Here, the aggrieved party claimed that Decedent orally promised him a portion of her estate in consideration of his payment of her living expenses and her care during her life. The matter was settled and the aggrieved party received 51% of the Estate. The trial Court therefore correctly concluded that any reimbursement for the living expenses of the Decedent was barred by the settlement agreement. However, the settlement agreement did not stipulate as to the responsibility for the payment of the funeral and burial expenses, which are customarily paid out of the estate. The matter was therefore remanded for further proceedings.