Appeal from decree of Orphans' Court of Montgomery County, No. 62-556, in re estate of John H. McClatchy, deceased.
Desmond J. McTighe, with him Philip D. Weiss, and McTighe, Koch, Brown & Weiss, for appellant.
J. Brooke Aker, with him Frank I. Ginsburg, F. Martin Duus, and Chadwick, Petrikin, Ginsburg & Wellman, and Smith, Aker, Grossman & Hollinger, for appellees.
Bell, C. J., Musmanno, Jones, Cohen, Eagen, O'Brien and Roberts, JJ. Opinion by Mr. Justice Cohen. Mr. Justice Musmanno did not participate in the decision of this case.
This is an appeal from a decree of the Orphans' Court of Montgomery County dismissing objections to the account of John B. McClatchy and Richard A. McClatchy, executors of the estate of John H. McClatchy, deceased.
John H. McClatchy died testate on March 12, 1960. Two of his sons, John B. and Richard A. McClatchy qualified as executors under the will. The first and final account of the executors was filed on April 2, 1962. Objections were filed to that account by appellants, heirs under the will of decedent. The objections which appellants pursue on appeal are as follows:
1. The executors should be surcharged for failing to include in the estate stock of the 69th Street Community House Corporation, the 69th and Ludlow Streets Building Corporation and the 69th and Sansom Streets Building Corporation.
2. The executors should be surcharged for the repayment, from the probate estate of life insurance premiums paid on the life of decedent by the 69th Street Community House Corporation.
3. Certain counsel fees and executors' commissions claimed or paid in the account should be denied.
4. Certain conveyances of real estate by decedent to executor John B. McClatchy during his life were invalid, and consequently such real estate should be included in the estate.
. The executors should be surcharged for refunding from the estate to the 69th Street Community House Corporation and the 69th and Ludlow Streets Building Corporation certain monies allegedly drawn in advance by decedent as salary for services to be rendered after the date of his death.
We will dispose of these objections in the above order.
I. Stock of the 69th Street Community House Corporation, 69th and Ludlow Streets Building Corporation, and 69th and Sansom Streets Building Corporation
Appellants contend that shares in the aforementioned corporations were owned by decedent at the time of his death and hence should have been included in decedent's estate.
The facts pertinent to this issue are as follows: Decedent and one Samuel Clevenger were business associates in the 1920's. Decedent gave Clevenger and his wife ground rents on properties owned by decedent. In 1939 two notes payable to the Clevengers were given in lieu of the payment of the ground rent liability. When the two notes were signed, decedent pledged all of his stock in the said corporations as collateral for their payment. On December 1, 1939, Rosemary D. McClatchy, wife of executor John B. McClatchy, purchased the notes from the Clevengers and acquired decedent's stock as collateral. On May 1, 1940, the parties who are now executors wrote letters to the corporations calling attention to the fact that the notes were in default because of nonpayment of interest and because the corporations were insolvent. The letters ...