Estate of Brojack, In re

• Decision Date: 05 December 1983
• Docket Number: No. 665,665
• Citation: 321 Pa.Super. 154,467 A.2d 1175
• Parties: In re ESTATE OF Helen BROJACK, Deceased. Appeal of William BROJACK and Peter Brojack, Jr., Heirs.
• Court: Pennsylvania Superior Court

Page 1175

467 A.2d 1175

321 Pa.Super. 154

In re ESTATE OF Helen BROJACK, Deceased Appeal of William BROJACK and Peter Brojack, Jr., Heirs.

No. 665.

Superior Court of Pennsylvania.

Argued March 22, 1983.

Decided Sept. 23, 1983.

Reargument Denied Dec. 5, 1983.

David L. Kurtz, Moscow, for appellants.

Patrick John Mellody, Scranton, for Brojack, participating party.

P. Timothy Kell, Scranton, for Warnetsky, et al., participating party.

Before HESTER, JOHNSON and POPOVICH, JJ.

JOHNSON, Judge:

This is an appeal from an order dismissing appellant-William Brojack's objections ¹ to the first and final account of the estate of Helen Brojack, deceased (hereinafter referred to as the decedent). The decedent was the mother of William Brojack (Bill), Peter Brojack, Jr. (Peter), Martha Warnetsky (Martha), Eleanor Hilavaty (Eleanor) and Paul Brojack (Paul). The five individuals named above are the sole beneficiaries under the will of the decedent; each was to receive an equal share. Paul was named as executor.

The decedent died on November 27, 1978. Family meetings were held on January 31, 1979 and March 16, 1979. Various estate assets were sold to the various beneficiaries and releases were executed as to most of such assets. Bill was deeded the family homestead (known as the farm) after the second meeting. Before the second meeting he had received title to a car which had been owned by American Silt Processing Co., a corporation owned by decedent. ² No release was signed as to the car. Peter purchased an antique Cadillac from his mother's estate after the second meeting. Martha was to purchase two lots from the estate for her daughter; the record does not indicate whether this transaction was completed. The heirs agreed at the first meeting to reimburse Bill for his share of the proceeds of a sale of property, known as the Keyser Avenue property, which had been transferred to nonrelatives nine years earlier. Bill had allowed his father, Peter, Sr., decedent's husband (who had predeceased decedent), to retain such monies for his own use. Bill was paid by means of two checks, both dated before, though not processed until after, the second meeting. Subsequent to the second meeting, the executor entered into an agreement of sale with Martha for the transfer of American Silt. This sale has not been consumated due to the dispute which is the center of this appeal.

Appellants, Bill and Peter, complained that the sale price for American Silt is inadequate. The executor argues that the sale of the company was part of an oral family settlement agreement, binding on all the heirs. Appellees, Martha and Eleanor, likewise contend that a valid family agreement exists and that it should be enforced. The Orphans' Court found that a comprehensive family agreement exists which included the sale of American Silt to Martha. The chancellor dismissed the objection to such sale ³ and hence this appeal.

"[I]n reviewing the decision of the orphans' court, our task is to assure that the record is free from legal error and to determine if the chancellor's findings are supported by competent and adequate evidence, and are not predicated upon capricious disbelief of competent and credible evidence." Cohen Will, 445 Pa. 549, 550, 284 A.2d 754, 755 (1971); Garges Estate, 474 Pa. 237, 378 A.2d 307 (1977); Holtz Will, 422 Pa. 540, 222 A.2d 885 (1966); Hunter Will, 416 Pa. 127, 205 A.2d 97 (1964).

In Re Estate of McCrea, 475 Pa. 383, 386-87, 380 A.2d 773, 775 (1977) (brackets in original); quoted in In Re Estate of Damario, 488 Pa. 434, 437, 412 A.2d 842, 844 (1980). While our review of the Orphans' Court findings of fact is limited to considering whether they are supported by the record, we are not so restricted in reviewing the legal conclusions derived from the facts. In Re Ischy Trust, Etc., 490 Pa. 71, 415 A.2d 37 (1980). A finding of consent to or affirmance of a family agreement is a mixed question of fact and law which must be reviewed in light of the particular circumstances of the particular case. See Zampetti v. Cavanaugh, 406 Pa. 259, 176 A.2d 906 (1962).

In the current case the chancellor made the following findings. The decedent's five children were represented at the two family meetings; due to health reasons Peter was represented by his wife, Helen (not to be confused with decedent), and a son at both meetings. At the first meeting the executor provided a full and substantial disclosure of the estate assets, including documents pertaining to American Silt. Appraisals and alternate values were provided; Peter's wife, Helen, delivered such papers to him after the first meeting. After discussion at the first meeting, agreement was reached regarding the sale of various assets to the various beneficiaries, including American Silt to Martha. Agreement was also reached as to the payment to Bill of his claim for a share of the sale proceeds of the Keyser Avenue property. Pursuant to such oral agreement, various assets were transferred.

At the meeting of March 16, 1979, the attorney for the estate was present and had documents for the transfer of American Silt. However, at the executor's request, the papers were not signed at that time so that changes could be made in the allocation of the purchase price. No objection was raised, at either meeting, to the sale of American Silt. The court found that it was not until June 1979 that Bill offered a higher price for American Silt, after he had already received and accepted benefits of the family agreement.

Family settlement agreements are favored in this Commonwealth because they are an attempt to avoid potentially divisive litigation. The existence of such agreement must be shown by clear and unambiguous evidence; the agreement must be binding on all parties. In Re Estate of McCrea, supra; In Re Estate of Stancik, 451 Pa. 20, 301 A.2d 612 (1973); In Re Estate of Sumney, 425 Pa. 224, 228 A.2d 915 (1967). However, where a fair and valid agreement is present it will be upheld whenever possible; in the absence of fraud the agreement is binding even though based on an error of law. Id. In this current appeal, after having reviewed the almost 700 pages of testimony, and numerous exhibits, we find that the record supports the chancellor's conclusion that an integrated agreement existed, which included the sale of American Silt. We set forth only a brief summary of the pertinent testimony.

Paul testified that he handed out at the first meeting various documents to all present; included were various financial statements regarding American Silt and appraisals of the assets of the estate. The balance sheet of American Silt showed a $94,000.00 debt owed to the decedent. ⁴ Martha stated she would pay book value ⁵ for the company. No one objected to the sale. Bill thought the price was too high. Helen Brojack, Peter's wife, did not tell anyone that she had no authority to act for her husband. At the second meeting when the execution of the sale agreement for the sale of American Silt was postponed, all present were asked if they had any objections to any of the sales. No objections were expressed. Paul thought that a firm family agreement existed.

Paul further explained that an 8 acre tract had been omitted from the American Silt documents and the inventory because the realtor believed the parcel was of no value, except to American Silt. He did not realize the omission of the parcel from all the documents until after the second family meeting when Bill brought the subject up after the agreement had been executed by Paul. At that time he (Bill) suggested the tract be valued at $1,000. Paul further testified that he had explained at the family meetings that the $94,000 debt owed to the decedent was to be forgiven. No one objected. The sales agreement was signed sometime after the second family meeting. ⁶ No objections were voiced to the executor until July, 1979.

Martha testified that Bill told her at the first meeting that the sale price for the business was too high. She responded that she was willing to pay the book value. No one else expressed any interest in the company. At the second meeting everyone was ready to sign the agreement although Paul desired changes. There were no objections to the sale at this time. The $94,000 was discussed. Martha subsequently signed the agreement and arranged for financing. She testified that all agreed to pay Bill for the sale of the Keyser property to avoid any dispute even though it was questionable that the estate was liable for it. She believed that a family agreement had been reached.

Eleanor testified that everyone at the first meeting was provided with copies of the various documents. Paul reviewed everything. Bill thought the price listed for American Silt was too high, but Martha was willing to pay it. At the second meeting no one else expressed any interest in the company and she thought everything was resolved. Everyone, including Bill, had a chance to look at the agreement and everyone was ready to sign it. Peter's wife never stated that she would have to discuss matters with her husband. Eleanor understood that selling the farm and the company to members of the family would result in less money for the estate, but for the sake of family harmony she agreed and thought everyone else had also.

Helen Brojack, Peter's wife, stated that she informed those at the meeting that she would have to consult with Peter, before she could agree to anything. She claimed that she did not receive all the appraisals. Her son, after the first meeting, told Paul that the sale price for the farm was too low. Her husband, Peter, called Paul the day after the first meeting to oppose the sale of American Silt and to offer to buy it himself. At the second meeting no objections were raised to the sale of American Silt. Helen did not see the sales agreement at the second meeting and there was no discussion of the sale at that time. She did not realize that the...