McNeil v. Jordan

• Decision Date: 21 March 2006
• Citation: 894 A.2d 1260
• Parties: Henry McNEIL, Jr., Appellant v. Barbara McNeil JORDAN and Henry A. Jordan, Appellees.
• Court: Pennsylvania Supreme Court

Page 1260

894 A.2d 1260

Henry McNEIL, Jr., Appellant v. Barbara McNeil JORDAN and Henry A. Jordan, Appellees.

Supreme Court of Pennsylvania.

Argued April 15, 2004.

Decided March 21, 2006.

Karl L. Prior, King of Prussia, Aaron Richard Krauss, James Frances Mannion, King of Prussia, H. Robert Fiebach, Patrick J. O'Connor, Southampton and Gaele M. Barthold, for Henry McNeil, Jr.

Clifford Alan Rieders, for PA Trial Lawyers Association.

Dara Beth Less, William T. Hangley, Philadelphia, for Jordan et al.

Before: CAPPY, C.J., CASTILLE, NIGRO, SAYLOR, EAKIN and BAER, JJ.

OPINION

Justice BAER.

Henry S. McNeil, Jr, (Henry Jr.), appeals the order of the Superior Court affirming the order of the Court of Common Pleas of Montgomery County, which dismissed his action alleging intentional interference with testamentary expectancy. The trial court dismissed the action with prejudice when Henry Jr. declined the court's invitation to file an amended complaint after it denied his request for pre-complaint discovery. In refusing to amend his complaint, Henry Jr. made clear that, given the trial court's prior ruling dismissing his complaint without prejudice, and absent pre-complaint discovery, he would be unable to survive a demurrer. Thus, he sought to challenge the trial court's refusal to permit pre-complaint discovery through the appellate process. We granted allocatur to clarify the parameters of pre-complaint discovery in Pennsylvania. Based upon the reasoning stated in Parts I, II, III, and V, which command a majority of the justices participating in this case, we reverse the order of the Superior Court and remand the matter to the Montgomery County Court of Common Pleas for further proceedings as directed in Part V.

I.

Henry S. McNeil, Sr. (Henry Sr.), and Lois Fernley McNeil had four children, all now grown: Appellant Henry Jr.; Appellee Barbara McNeil Jordan (Barbara), who is married to Appellee Henry A. Jordan (collectively, the Jordans); and non-parties Marjorie McNeil Findlay and Robert Douglas McNeil. Henry Sr. was the president of McNeil Laboratories, Inc., the maker of Tylenol and other medicines. In 1959, Johnson and Johnson purchased McNeil Laboratories in exchange for stock worth approximately $33 million, enriching Henry Sr. and Lois, each of whom proceeded to create identical trusts for each of their four children.

For reasons not of record, Henry Jr.'s relationships with his father and mother deteriorated during the 1970s, causing a prolonged, if not permanent, estrangement. Consistent therewith, in his 1979 will, Henry Sr. made substantial bequests to Barbara, Marjorie, and Robert, but excluded Henry Jr. Henry Sr. died in 1983 without having reconciled with Henry Jr.¹

The bulk of Henry Sr.'s estate funded a marital trust for Lois's lifetime benefit. Henry Sr. provided that upon Lois's death the proceeds of the marital trust would be used to create separate trusts for the couple's children and their families, exclusive of Henry Jr. Henry Sr., however, gave Lois a general power of appointment permitting her to modify this testamentary scheme.²

Henry Jr.'s contentions regarding his relationship with his mother after his father's death are somewhat inconsistent. Henry Jr. asserts that by the late 1980s, he and his mother had resumed a full relationship. In fact, he contends that during the ten years preceding her death in 1998, he had regular access to her. Simultaneously, however, Henry Jr. contends that the Jordans, motivated by their zeal for an increased share of Lois's estate, thwarted his reconciliation with Lois by limiting his access to her and controlling every aspect of her daily life, including prevailing upon her to discharge her independent counsel in favor of their preferred law firm.

Based on these conflicting factual premises, Henry Jr. asserts that prior to Lois's death, she expressed an intent to exercise her general power of appointment to equalize his and his siblings' inheritances, but, notwithstanding this expression of intent, Lois did not so act because of the Jordans' undue influence. Reading these contentions as consistently as possible, Henry Jr. appears to posit that the Jordans took all measures to discourage his relationship with Lois; they failed to the extent that Henry Jr. was able to restore a full relationship with her, but succeeded inasmuch as Lois never modified her estate plan to conform to her alleged intent to restore Henry Jr. to co-equal status with his siblings.

In December 1989, sometime after Henry Jr. claims to have reestablished a close relationship with her, Lois executed a new will. Lois then executed codicils thereto on March 21, 1990, December 8, 1992, and September 17, 1997, before passing away in 1998. Lois died with a personal estate of approximately $10 million, and the right, pursuant to her general power of appointment, to alter Henry Sr.'s direction that the $625 million remaining in the marital trust be distributed equally to all the couple's children except Henry Jr.

Lois exercised her general power of appointment to leave specific bequests to dozens of friends, employees, and charities. She also used the general power to make equal, but limited, specific distributions to each of the children's trusts, including Henry Jr.'s. She then made specific bequests to Henry Jr. of $2 million, a 25% interest in her vacation home in the Bahamas, and the right to participate in a lottery with the other children to purchase the family estate.

Notwithstanding these various specific bequests and devises, a substantial amount of the $625 million in the marital trust remained, and Lois permitted this to pass through Henry Sr.'s residuary clause, resulting in equal shares passing to Henry Jr.'s three siblings, but in his receipt of none of this money. It also is noteworthy that Lois named Henry Jr.'s three siblings as co-executors but excluded Henry Jr. from this role.

Henry Jr. did not contest the will and its codicils. Nevertheless, he did obtain permission from his siblings in their capacities as co-executors to review a small portion of his mother's estate documents. Henry Jr. also hired private investigators to find evidence that Lois intended to change her will to his benefit. Ultimately, on March 9, 1999, Henry Jr. filed a Writ of Summons against the Jordans in their individual capacities in the Montgomery County Court of Common Pleas. The Jordans retained counsel, and on April 14, 1999, filed a Praecipe for a Rule requiring Henry Jr. to file a complaint within twenty days.

Henry Jr. filed a complaint on May 4, 1999, asserting a claim for the tort of intentional interference with testamentary expectancy against the Jordans with respect to Lois's estate. The complaint alleged that Lois intended to distribute her probate assets and, through her general power of appointment, the balance of Henry Sr.'s marital trust equally among her children, and took affirmative steps to implement this plan, but was thwarted by the Jordans' undue influence over her.

The Jordans filed preliminary objections to the complaint including a demurrer asserting that Henry Jr. failed to aver that Lois intended to change her will to provide a described benefit to Henry Jr., the first element of a claim for tortious interference with testamentary expectancy.³ The trial court observed that Henry Jr. had pleaded only that Lois had stated in 1983, six years prior to execution of her will, that if Henry Jr. re-established a positive relationship with her, she would change her will to provide for him. The court reasoned that this was a conditional statement of intent, and legally insufficient to meet the first element of the tort of intentional interference with testamentary expectancy. Accordingly, on July 11, 2000, the court granted the Jordans' preliminary objections, and dismissed Henry Jr.'s complaint without prejudice, providing him thirty days to file an amended complaint.

Following dismissal of his original complaint without prejudice, Henry Jr. sought discovery with the averred expectation that it would enable him to prepare an amended complaint stating a cause of action. Henry Jr. sought from Lois's lawyers her estate planning files and all documents relating to her testamentary intent generated from 1983 to 1998; all documents referring or relating to Henry Jr.; and all billing records for services rendered with respect to Lois's estate planning during this fifteen-year period. The Jordans opposed Henry Jr.'s discovery requests, contending that they amounted to a "fishing expedition."

In an attempt to broker a compromise, the court proposed to grant Henry Jr.'s lawyers unlimited access to Lois's estate planning files to search for any indication that Lois ever expressed an intent to equalize Henry Jr.'s share. This review was to be for the attorneys only, and the information revealed would remain confidential. Prior to allowing any documents to be copied or used in the litigation, the court would determine whether the material was relevant to Lois's intent regarding Henry Jr. Henry Jr. rejected this compromise, choosing instead to file an amended motion for pre-complaint discovery.

Henry Jr. argued that he sought discovery in good faith and with a reasonable factual basis, and proffered the following underlying contentions: (1) in the mid-1990s, Henry Jr. spoke with a lawyer who had previously represented Lois in estate matters and, as a result of that conversation, Henry Jr. understood that he would be treated equally; (2) Henry Jr. was told in the mid-1990s that one of his siblings encouraged Lois to treat him equally; and (3) in the 1990s someone told Henry Jr. that one of his siblings had told someone else that Lois had included Henry Jr. in her will for "his portion" of the family wealth.

The trial court found nothing in the new factual averments to support the allegation that Lois expressed an intention to equalize Henry Jr.'s inheritance with that of...