Zeitchick's Estate, In re

• Decision Date: 30 June 1967
• Parties: In re ESTATE of Harry ZEITCHICK, Deceased. Appeal of Milton ZEITCHICK.
• Court: Pennsylvania Supreme Court

Page 131

231 A.2d 131

426 Pa. 171

In re ESTATE of Harry ZEITCHICK, Deceased.

Appeal of Milton ZEITCHICK.

Supreme Court of Pennsylvania.

June 30, 1967.

[426 Pa. 172] Edward A. Garabedian, Philadelphia, for appellant.

Leonard B. Rosenthal, Abrahams & Loewenstein, Philadelphia, for appellee.

Before BELL, C.J., and MUSMANNO, JONES, COHEN, EAGEN, O'BRIEN and ROBERTS, JJ.

OPINION OF THE COURT

O'BRIEN, Justice.

This appeal follows the decree of the Orphans' Court of Philadelphia County, dismissing appellant's exceptions to the amended supplemental adjudication of Judge Saylor, awarding $10,000. to the widow, Sophie Gross Zeitchick, appellee, as a creditor of the estate.

The testator died on December 14, 1963, survived by his widow, the appellee, and a son, the appellant. The marriage between the testator and the appellee was the second for both, and the appellant, decedent's son, was born of his previous marriage. The parties were married on October 12, 1956. On October 5, 1956, they executed an antenuptial nuptial agreement, under which the testator agreed to devise the premises at 6474 Anderson Street, Philadelphia, to appellee, in consideration for which the appellee agreed to release the rest of his estate from her claims as the surviving spouse. The agreement further provided that if the real estate at 6474 Anderson Street were sold in his lifetime, he would provide then, under such circumstances, in his will, a bequest of $10,000. to his widow in lieu of the real estate.

On the same day, the testator executed his Last Will and Testament, wherein, as agreed in the antenuptial agreement, he provided:

'i. I give, devise and bequeath to my beloved friend, SOPHIE GROSS, whom I intend to marry within the next few weeks, real estate premises in which I reside, to wit: 6474 Anderson Street, Philadelphia, Pennsylvania and all the contents thereof, subject, however, to any balance due on a mortgage against the said property. If I should sell the said premises 6474 Anderson Street before my decease, then in lieu thereof, I give, devise and bequeath to my beloved friend, Sophie Gross, the sum of Ten Thousand Dollars in cash as well as the contents of any other apartment or house which we may occupy as our home at the time of my death.'

In the same instrument, the testator devised and bequeathed to his son, Milton Zeitchick, all his right, title and interest in the partnership business conducted by himself and his son, including the real estate at 623 S. Sixth Street, Philadelphia, Pa., where the business was conducted. In addition, testator named his son as residuary legatee and executor of his estate.

On December 18, 1957, testator conveyed the premises at 6474 Anderson Street, Philadelphia, Pennsylvania, in which conveyance the appellee joined.

Testator's estate consisted of a small amount of cash, household goods and furniture appraised at $708., decedent's interest in the partnership of Harry Zeitchick & Son, and the real estate where the business was operated, valued at $10,500. At audit, on November 10, 1964, appellee presented a claim as creditor, by virtue of the antenuptial agreement, in the amount of $10,000. Previously, on or about December 24, 1963, appellee had filed notice of a claim in the amount of $10,000. as a lien against the property at 623 S. Sixth Street, Philadelphia, Pa., under Sec. 732(b)(2) of the Fiduciaries Act of 1949, as amended, 20 P.S. § 320.732(b)(2).

The validity of the antenuptial agreement and appellee's status as a creditor were admitted at audit, at which time the appellant contended that appellee could only be paid from personalty, and that by reason of the language of Paragraph 6 ^* of the ante-nuptial agreement, the real estate wherein the partnership business was conducted at 623 S. Sixth Street, Philadelphia, was beyond appellee's reach. On January 15, 1965, Judge Saylor filed his adjudication, awarding $10,000. to appellee as a creditor. He observed at that time that if the widow were to be paid her $10,000., it would be necessary to liquidate the parcel of real estate at 623 S. Sixth Street. The further ruled that Paragraph 6 of the antenuptial agreement did not place the property beyond the reach of appellee. Exceptions were filed and, in an opinion dated May 26, 1965, the matter was referred back to the auditing Judge for disposition of other questions not resolved at audit.

On November 16, 1965, Judge Saylor filed a supplemental adjudication, in which he surcharged the appellant for breach of fiduciary responsibilities, and directed the appellant to pay the amount thereof into the estate, and to sell the real estate in order to pay the appellee. On November 24, exceptions were again filed, and on January 10, 1966, the proceedings were again referred back to the auditing Judge for further consideration. On March 25, 1966, an amended supplemental adjudication was filed by the auditing Judge, which reduced the amount of the surcharge; however, in all other respects, the adjudications of January 15, 1965, and November 16, 1965, were confirmed. The court again ordered the appellant to sell the real estate and appellant again filed exceptions. On April 18, 1966, before the court en banc, the appellant's counsel stated:

'I have an application to make, your Honor. It is not my intention to argue the exceptions filed on behalf of the estate. I have no qualms with Judge Saylor's recent adjudication. All that my client asks is that one point that has previously been decided by this court be taken to the Supreme Court.

'That is whether or not Sophie Zeitchick is in fact a creditor, one; and two, if she is in fact a creditor, were not the premises isolated from any claim on her behalf.'

The court en banc, accordingly, at the request of appellant, dismissed all of the exceptions except the one relative to the finding of the auditing judge that appellee had a valid claim for $10,000. This exception, in turn, was dismissed by the court en banc for the reasons set forth in Judge Lefever's opinion of March 26, 1965. The court en banc confirmed absolutely the adjudication and supplemental adjudication Estate, 422 Pa. 446, 450, 221 A.2d 117, 119

The decision reached by the court below was proper. As we recently said in Pratt Estate, 42i Pa. 446, 450, 221 A.2d 117, 119 (1966):

'The law is well settled that where a testator in his will gives specified property or a share of his estate in exact or substantial compliance with the terms of his obligations under an inter vivos property settlement (or separation) agreement made with his wife, That wife is a creditor of his estate and not a legatee under his will. Mills Estate, 367 Pa. 504, 80 A.2d 809. Cf. also, Neller Estate, 356 Pa. 628, 53 A.2d 122; Brown's Estate, 340 Pa. 350, 17 A.2d 331; Mahoney Estate, 356 Pa. 358, 52 A.2d 328; Coane's Estate, 310 Pa. 138, 165 A. 2; Bowman v. Knorr (No. 1), 206 Pa. 270, 55 A. 976.' (Emphasis in original)

The same principles which apply to property settlements made in contemplation of separation or divorce apply with equal force to antenuptial agreements made in contemplation of marriage. Moreover, in Wilson Estate, 346 Pa....