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MULHOLLAND v. PITTSBURGH NATIONAL BANK (03/16/65)

decided: March 16, 1965.

MULHOLLAND
v.
PITTSBURGH NATIONAL BANK, APPELLANT



Appeals from decree and order of Court of Common Pleas of Allegheny County, Oct. T., 1960, No. 1343, in case of Laura E. Mulholland v. Pittsburgh National Bank, successor to Peoples First National Bank and Trust Company, Richard Eastell Hoover, Michael Hoover et al.

COUNSEL

Frank E. Coho, with him Johnston & Coho, for plaintiff.

Donald C. Bush, with him Richard B. Tucker, Jr., and Griggs, Moreland, Blair & Douglass, and Patterson, Crawford, Arensberg & Dunn, for defendant.

Walter A. Koegler, guardian ad litem, in propria persona.

Bell, C. J., Musmanno, Jones, Cohen, Eagen and Roberts, JJ. Opinion by Mr. Justice Jones.

Author: Jones

[ 418 Pa. Page 98]

Laura E. Mulholland (appellee),*fn1 in 1940 married Richard Hoover. Of that marriage, dissolved by divorce in 1951, three children were born. Sometime prior to January 1953 she married Joseph Millar and of that marriage, dissolved by divorce in 1953, no children were born. Thereafter, she married Harold Mulholland and of that marriage one child has been born.

On many occasions in the period 1943-1950, by reason of appellee's excessive drinking, Richard Hoover, then appellee's husband, was compelled to hospitalize her in an attempt to cure her. On March 30, 1950, the Court of Common Pleas of Allegheny County declared appellee an "inebriate" and committed her to a Pennsylvania hospital where she remained until October 3, 1950, at which time the court provisionally released her. Thereafter, appellee went to Clearwater, Florida.

[ 418 Pa. Page 99]

While there she resumed her drinking to the extent that Richard Hoover removed the children, who had gone to Florida on a visit in January 1951 from her custody.*fn2

On February 4, 1953, on petition of her father, appellee was adjudged by the Court of the County of Pinellas in Florida an "incompetent by reason of drunkenness, excessive use of drugs, chronic inebriacy, impulsive drinking, orgies, and occasional violence constituting anti-social pyschopathy". That court appointed appellee's father as guardian of appellee's person and he placed her in a Louisiana Sanitarium. In February 1954, upon application of her father, appellee was adjudged by the Court of Common Pleas of Allegheny County an inebriate, and appellee, having been returned to Pittsburgh, was committed to a Pennsylvania institution. Less than four months later, appellee was released by the court and placed in the custody of a Mrs. Lemmon.

On March 18, 1955, the Court of Common Pleas of Allegheny County found that appellee was "able to handle all her personal affairs", cancelled her probation and released her from custody. Since that time appellee has used neither alcohol nor drugs and has been in all respects a normal person.

On April 30, 1951, while in Florida, appellee executed two trust agreements and an assignment.*fn3 Under the first trust agreement, appellee transferred to the Pittsburgh National Bank, as trustee (Bank), certain securities and United States government bonds and, under the provisions of that trust, appellee is to

[ 418 Pa. Page 100]

    receive the net income for life and so much of the principal as the Bank, in its sole discretion, may deem necessary to maintain and support her and, upon appellee's death, separate trusts, to terminate under certain conditions, such as attainment of a certain age, etc., were set up for "each of the issue of the [appellee] living at the [appellee's] death per stirpes." Under the second trust agreement, appellee transferred to the Bank, in trust, 2055 shares of Washington Oil Company common stock and created therewith three separate trusts for appellee's three children born of her marriage to Richard Hoover; under this trust appellee reserved no interest in either the income or the corpus for herself. Both trusts are irrevocable in nature. Under the assignment, appellee transferred to the Bank her interest in certain oil and gas leaseholds in Elk County, Pennsylvania, to become part of the principal of the first trust.

On August 1, 1960, appellee instituted an equity action in the Court of Common Pleas of Allegheny County against the Bank to set aside both the trust agreements and the assignment upon the grounds that at the time of execution of these instruments she was incompetent and unduly influenced and coerced both by her father, Richard Eastall, and her then husband, Richard Hoover. In this action, appellee's four children, then all minors, were joined and a guardian ad litem appointed for them. The court sustained preliminary objections to appellee's complaint on the grounds (1) of laches and (2) that the complaint insufficiently averred fraud, duress, coercion or undue influence. On appeal to this Court we reversed the order of the court below: Mulholland v. Pittsburgh National Bank, 405 Pa. 268, 174 A.2d 861.

The matter was then heard in the Court of Common Pleas of Allegheny County and that court, after hearing, ultimately ...


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