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[U] In re Ahnert

Superior Court of Pennsylvania

March 3, 2014

IN RE: HENRY A. AHNERT, III, IRREVOCABLE LIFE INSURANCE TRUST, DATED 12/31/1995, APPEAL OF: RHETA KILLIAN, Appellant

NON-PRECEDENTIAL DECISION

Appeal from the Decree entered on March 11, 2013 in the Court of Common Pleas of Monroe County, Orphans' Court Division, No. 119 of 2008

BEFORE: FORD ELLIOTT, P.J.E., WECHT and MUSMANNO, JJ.

MEMORANDUM

MUSMANNO, J.

Rheta Killian ("Killian") appeals from the Decree that dismissed her Exceptions and Request for Post-Trial Relief regarding an award of attorneys' fees against her.[1] Additionally, Helen Roberta Ahnert ("Trustee"), as Trustee of the Henry A. Ahnert, III, Irrevocable Life Insurance Trust, dated 12/31/1995 (hereinafter "the Trust"), has filed a Motion requesting that we quash and/or dismiss Killian's appeal (hereinafter "Motion to Quash"). We affirm the Decree and deny Trustee's Motion to Quash.

The Orphans' Court summarized the relevant history underlying this protracted and contentious litigation as follows:

On July 15, 2006, Henry A. Ahnert, III ["Decedent"], a resident of Vermont, died of an allergic reaction to a bee sting.
[The Trust[2] became payable to [Decedent's] children upon his death.
[Decedent] had been previously married and divorced. That union produced two children: Henry [Ahnert, ] IV[, ] and Anna Marie [Ahnert], both now adults.
[Decedent] then had a relationship with[, ] but did not marry[, ] [] Killian. That relationship produced a son, Connor [Ahnert ("Connor")], age 15.
[Decedent] later married Lisa Smith-Ahnert ["Smith-Ahnert", ] and together they had one child, Thatcher [Ahnert], age 13, and adopted Taylor [Ahnert], age 8, Bill [Ahnert], age 12, and Tete [Ahnert], age 8.
Ten days before [Decedent] died, on July 5, 2006, the Monthly and Probate Court, Montserrado County, Liberia[, ] issued a Decree of Adoption for Bill and Tete Ahnert to [Decedent] and [Decedent's] wife, [] Smith-Ahnert []. [These proceedings are collectively hereinafter referred to as "the Liberian adoptions."]
On March 18, 2008, the Hartford[, Vermont] Probate Court entered a Decree of Re-Adoption for Bill and Tete Ahnert. [Killian], Connor['s] mother, petitioned the Hartford Probate Court to reconsider its Decree of Re-Adoption, and argued that the Liberian adoptions were invalid and should be vacated. When that Court declined to overturn its Decree, Killian then filed a Motion for Relief from Judgment, to Re-open the Proceeding, and for Standing in the Windsor[, Vermont] Superior Court. Killian hoped to establish that [Decedent] died with only five children and, therefore, her son Connor was entitled to a larger share of the Trust.[FN]
[FN] Killian has also made this same challenge in Florida[, ] where [Decedent's] children are per stirpes beneficiaries of a [separate] trust created by [Decedent's] father because of [Decedent's] death.
On July 10, 2008, [Trustee] filed a First and Partial Account and a Petition for Adjudication/Statement of Proposed Distribution of the Trust in [the Monroe County, Pennsylvania Orphans' Court (hereinafter "the Orphans' Court")]. Trustee's First and Partial Account asserted that the Trust should be divided into seven equal shares, with two shares (for Bill and Tete [Ahnert]) held in escrow pending the resolution of Killian's challenge to the Liberian adoptions in the Vermont court system. Shortly thereafter, Smith[-Ahnert] filed an Objection to Trustee's Petition for Adjudication/Statement of Proposed Distribution on behalf of Thatcher, Taylor, Bill, and Tete Ahnert. Specifically, Smith[-Ahnert] objected to Trustee's proposal to distribute only five shares of the Trust and argued that all seven shares should be administered at that time.
On April 16, 2009, the Windsor, Vermont Superior Court dismissed Killian's Motions for Relief from Judgment and to Re-open the Proceeding for lack of standing, and affirmed the Hartford[, Vermont] Probate Court's decision to give the Liberian adoptions full faith and credit. Killian did not appeal this decision. Trustee then filed, [with the Orphans' Court of this Commonwealth, ] a Supplemental First and Partial Account and an Amended Petition for Distribution on November 6, 2009, which incorporated the Vermont Court's Order affirming the validity of the Liberian adoptions and reaffirming the Re-Adoption Decree. Killian thereafter filed objections to Trustee's Supplemental Account and Amended Petition for Distribution, and asserted in New Matter that Trustee should be removed as administrator of the Trust. Killian also filed Motions to Compel Discovery of information regarding the Liberian adoptions and to Compel Smith[-Ahnert's] Deposition. [The Orphans'] Court denied both [M]otions on March 15, 2010, and scheduled an evidentiary hearing for June 23, 2010, to address objections to the First and Partial Account (and as Supplemented) and Petition for Adjudication/Statement of Proposed Distribution (and as Amended).
On June 22, 2010, on the eve of the scheduled hearing, Killian filed a Motion for Continuance of the hearing. In her [M]otion, Killian argued that the [Orphans'] Court should grant a continuance to allow her to conduct an in-depth investigation of the Liberian adoptions. That same day, Smith[-Ahnert] filed a Motion in Limine to preclude any testimony in reference to the Liberian adoptions at the hearing. The [Orphans'] Court granted Smith[-Ahnert's] Motion in Limine on the basis that the Full Faith and Credit Clause of the United States Constitution, Art. IV, § 1[, ] requires states to respect the judicial proceedings of another state, and Vermont had previously issued a Re-Adoption Decree for Bill and Tete Ahnert. The next day, on June 23[, 2010], the [Orphans'] Court denied Killian's Motion for Continuance and granted Trustee's Motion for Nonsuit. With respect to Trustee's Motion for Nonsuit, the [Orphans'] Court found that Killian had not satisfied her burden of proving that Trustee's commissions were unreasonable. The [Orphans'] Court also denied Killian's request to remove Helen Roberta Ahnert as Trustee of the Trust instrument.
Killian then filed a Motion for Post-Trial Relief and Exceptions to Adjudication on July 2, 2010, in which she alleged that the [Orphans'] Court erred by denying her Motion to Compel Discovery in March, and by denying her Motion for Continuance and granting Trustee's Motion for Nonsuit [on] June [23, 2010]. On July 12, 2010, Trustee filed a Motion for Clarification and requested that the [Orphans'] Court specifically find that seven beneficiaries existed according to the Trust's terms, and that [] Trustee should make distributions in accordance with that finding. Killian, Smith[-Ahnert], and Trustee filed briefs in support of their positions, and [the Orphans'] Court heard oral arguments regarding Killian's Motion for Post-Trial Relief and Exceptions to Adjudication and Trustee's Motion for Clarification ….

Orphans' Court Opinion, 9/15/10, at 1-4 (footnote added; some footnotes in original omitted).

On July 30, 2010, Trustee and Smith-Ahnert filed separate Petitions for Attorneys' Fees (collectively "the Attorneys' Fees Petitions"), asserting that Killian's actions in filing and continuing her litigation of this case were arbitrary, vexatious, obdurate, dilatory, and/or made in bad faith.[3]

On September 15, 2010, after conducting a hearing, the Orphans' Court entered an Order denying Killian's Motion for Post-Trial Relief and Exceptions. In this Order, the Orphans' Court clarified that the effect of its June 23, 2010 Order, wherein the Orphans' Court granted a nonsuit against Killian, was a determination that Bill and Tete Ahnert were, in fact, beneficiaries under the terms of the Trust. Accordingly, the Orphans' Court ordered the Trustee to distribute the Trust proceeds to all seven of Decedent's children, including Bill and Tete Ahnert. Importantly, however, the September 15, 2010 Order did not address the Attorneys' Fees Petitions. Killian filed an appeal from the September 15, 2010 Order (hereinafter "the 2010 Appeal"). This Court quashed the appeal as interlocutory, concluding that the September 15, 2010 Order was not final for purposes of appeal because the Orphans' Court had not ruled on the pending Attorneys' Fees Petitions. See In Re: Henry A. Ahnert, III, Irrevocable Life Ins. Trust, 2830 EDA 2010 (Pa.Super. filed July 20, 2011) (unpublished memorandum at 6) (citing Miller Elec. Co. v. DeWeese, 907 A.2d 1051, 1054-55 (Pa. 2006) (holding that "requests for counsel fees under 42 Pa.C.S.A. § 2503 are part of the principal claim and must be determined as part of that claim.")). Accordingly, the case was remanded to the Orphans' Court for it to rule on the Attorneys' Fees Petitions.

After conducting evidentiary hearings on the Attorneys' Fees Petitions, on October 15, 2012, the Orphans' Court issued a Decree Nisi, awarding attorneys' fees to Trustee and Smith-Ahnert.[4] In response, Killian filed Exceptions and a Request for Post-Trial Relief, contending that no award of attorneys' fees was warranted under the circumstances. By a "Final Decree" entered on March 11, 2013, the Orphans' Court denied Killian's Exceptions and Request for Post-Trial Relief, and confirmed the award of attorneys' fees entered in its October 15, 2012 Decree Nisi.

On April 10, 2013, Killian filed a Notice of Appeal from the March 11, 2013 Decree. Additionally, the Notice of Appeal reflected that Killian was appealing the Orphan's Court's Order entered on September 15, 2010, wherein the Court denied Killian's Motion for Post-Trial Relief and Exceptions filed with regard to the entry of a nonsuit against her. Although this Court previously determined, in the 2010 Appeal, that the September 15, 2010 Order was interlocutory, the Order is now properly before us. See Quinn v. Bupp, 955 A.2d 1014, 1020 (Pa.Super. 2008) (holding that "[i]nterlocutory orders that are not subject to immediate appeal as of right may be reviewed in a subsequent timely appeal of a final appealable order or judgment.") (citation omitted); see also Bird Hill Farms, Inc. v. U.S. Cargo & Courier Serv., Inc., 845 A.2d 900, 903 (Pa.Super. 2004) (stating that "once an appeal is filed from a final order, all prior interlocutory orders are subject to review.").

On May 9, 2013, Trustee filed a Motion to Quash with this Court, asserting that Killian's appeal was untimely filed. We must first rule on this Motion before addressing Killian's issues on appeal. Trustee points out that, on October 25, 2012, Killian filed Exceptions (hereinafter "Killian's 2012 Exceptions") to the Orphans' Court's Decree Nisi that awarded attorneys' fees to Trustee and Smith-Ahnert. Motion to Quash, 5/9/13, at ¶ 1. Trustee further points out that our Pennsylvania Supreme Court promulgated a Rule setting a time limit for an Orphans' Court to issue a ruling on exceptions, which provides as follows:

(f) Time Limits for Decision on Exceptions. The Orphans' Court shall decide exceptions[, ] including supplemental exceptions and cross exceptions[, ] within one hundred and twenty (120) days of the filing of the initial exceptions. If the Orphans' Court fails to decide the exceptions within one hundred and twenty (120) days, the exceptions shall be deemed denied by operation of law on the one hundred and twenty first (121st) day and the clerk is directed to enter the deemed denial on the docket as of that date. The appeal period shall begin to run as of the one hundred and twenty first (121st) day.

Pa.O.C. 7.1(f) (emphasis added); see also Motion to Quash, 5/9/13, at ¶ 2. In the instant case, the Orphans' Court did not issue a ruling on Killian's 2012 Exceptions prior to the expiration of 120 days after the date they were filed.[5] Trustee contends that, therefore, under Rule 7.1(f), Killian's 2012 Exceptions were "deemed denied" by operation of law on the 121st day after they were filed, which was February 25, 2013. Motion to Quash, 5/9/13, at

¶ 4. According to Trustee, Killian's appeal was untimely pursuant to Rule 7.1(f) because the Notice of Appeal, filed on April 10, 2013, was not filed within 30 days of the "deemed denial" date of February 25, 2013. Id. at

¶¶ 4-5. We disagree.

A review of the Orphans' Court's docket reveals that the clerk never entered a notation on the docket that Killian's 2012 Exceptions were deemed denied by operation of law, in violation of Rule 7.1(f). Rather, the first notation in the docket pertaining to a ruling on Killian's 2012 Exceptions was the Orphans' Court's March 11, 2013 Order. Killian timely filed a Notice of Appeal from this Order. Accordingly, Trustee's reliance upon Rule 7.1(f) is misplaced, and we thus deny Trustee's Motion to Quash.

On appeal, Killian presents the following issues for our review:
A. Whether Smith-Ahnert failed to prove the purported adoptions of [Bill and Tete Ahnert] as of [] Decedent's date of death, and [] Trustee failed to document such purported adoptions to the [Orphans' Court], before the [Orphans' Court's] grant of non-suit against Killian, which failures could not be cured by [] Trustee's post-trial[] "Motion for Clarification, " thereby prohibiting [(sic)?]
B. Whether the judicial doctrine of comity and the common law principle of "full faith and credit" do not resolve the effects of the original adoptions, because Killian alleged fraud, illegality, and inconsistency of the Liberian [adoption] proceeding with this Commonwealth's judicial sensibilities, and such exceptions were never refuted by Smith-Ahnert or [] Trustee by evidence in the record, so that comity cannot be invoked[?]
C. Whether the assessment of counsel fees and costs of [preparing] the fee hearing transcript against Killian[, and] in favor of Smith-Ahnert and [] Trustee[, ] were unwarranted and an abuse of discretion, since the distribution of trust shares to [Bill and Tete Ahnert] was improper, and since Killian acted in good faith, with a reasonable basis in law, and with due diligence throughout the proceedings[?]

Brief for Appellant at 18 (capitalization omitted).

Our standard of review of the findings of an [O]rphans' [C]ourt is deferential. When reviewing a decree entered by the Orphans' Court, this Court must determine whether the record is free from legal error and the court's factual findings are supported by the evidence. Because the Orphans' Court sits as the fact-finder, it determines the credibility of the witnesses and, on review, we will not reverse its credibility determinations absent an abuse of that discretion.
As an appellate court[, ] we can modify an Orphans' Court decree only if the findings upon which the decree rests are unsupported by competent or adequate evidence or if there has been an error of law, an abuse of discretion or a capricious disbelief of competent evidence. The test to be applied is not whether we, the reviewing court, would have reached the same result, but whether a judicial mind, after considering the evidence as a whole, could reasonably have reached the same conclusion.

In re Estate of Devoe, 74 A.3d 264, 267 (Pa.Super. 2013) (citations and quotation marks omitted).

We will address Killian's first two issues simultaneously because they are related. In challenging the entry of a nonsuit against her, Killian maintains that neither Trustee nor Smith-Ahnert ever rebutted Killian's assertion that the original Liberian adoption Decrees pertaining to Bill and Tete Ahnert were invalid because such adoptions were (1) "uncertified and unauthenticated[;]" and (2) fraudulent, illegal, and/or "inconsisten[t] with this Commonwealth's judicial sensibilities." Brief for Appellant at 33-34, 36. Killian further asserts that the Orphans' Court improperly failed to permit her to conduct adequate discovery regarding the issue of the legality and enforceability of the Liberian adoption Decrees. Id. at 35, 39. Additionally, Killian argues that the Orphans' Court improperly recognized the adoptions of Bill and Tete Ahnert as being lawful, valid adoptions in this Commonwealth under the Full Faith and Credit Clause of the United States Constitution. Id. at 36. According to Killian, a court may not apply full faith and credit where, as here, an opposing party "objected on grounds of fraud, illegality, and inconsistency with Pennsylvania's judicial sensibilities, and where such allegations were never refuted …." Id.

Our standard of review pertaining to a challenge to the entry of a nonsuit is as follows:

The trial court, on the oral motion of a party, may enter a nonsuit if the plaintiff has failed to establish a right to relief. Pa.R.C.P., Rule 230.1, 42 Pa.C.S.A. In evaluating the trial court's grant of a nonsuit, we must view the evidence adduced on behalf of the plaintiff as true, reading it in the light most favorable to her; giving her the benefit of every reasonable inference that a jury might derive from the evidence and resolving all doubts, if any, in her favor. Additionally, a compulsory nonsuit may be entered only in cases where it is clear that the plaintiff has not established a cause of action. When so viewed, a nonsuit is properly entered if the plaintiff has not introduced sufficient evidence to establish the necessary elements to maintain a cause of action.

In re Estate of Boardman, 80 A.3d 820, 822 (Pa.Super. 2013) (quotation marks, brackets, ellipses and citations to case law omitted).

Here, the Orphans' Court concisely addressed Killian's above- mentioned claims as follows:

Killian's requests for discovery concerning the validity and enforceability of the Liberian adoptions clearly fall outside the proper scope of discoverable evidence and, if granted, would subject Smith[-Ahnert] to "unreasonable annoyance and burden[, ]" as contemplated by [Pennsylvania Rule of Civil Procedure] 4011 [(providing, in relevant part, that "[n]o discovery … shall be permitted which … would cause unreasonable annoyance, embarrassment, oppression, burden or expense …." Pa.R.C.P. 4011(b)).] Before the June 23, 2010 hearing, [the Orphans' Court] denied Killian's request to introduce evidence of the Liberian adoptions and barred any testimony about those adoptions at the hearing as irrelevant under the Full Faith and Credit Clause of the United States Constitution, Art. IV, § 1. [The Orphans'] Court must give the Vermont Re-Adoption Decree full faith and credit as a judicial proclamation from another state. See In re Christoff's Estate, 411 Pa. 419[, 422], 192 A.2d 737[, 738] (Pa. 1963) [(holding that the Full Faith and Credit Clause requires state courts to recognize and enforce the judgments/decrees of sister states, so long as such court had jurisdiction over the parties and the subject matter)]; In re Crossley's Estate, 7 A.2d 539[, 540] (Pa.Super. 1939) [(same)]. Killian erroneously relies on the [Pennsylvania] Supreme Court's reasoning in Hilkmann [v. Hilkmann, 858 A.2d 58 (Pa. 2004), ] where the [C]ourt declined to recognize an Israeli judgment under the principle of comity. Hilkmann only applies, however, when Pennsylvania courts consider whether a foreign judgment should be recognized in the Commonwealth. [See id. at 65 (stating that the Full Faith and Credit Clause requires state courts to recognize and enforce the judgments of sister states, but "does not extend to judgments of foreign nations.")] Here, [the] Vermont courts have recognized the validity of the Liberian adoption [D]ecrees, and [the Orphans' Court] must give these judicial proclamations full faith and credit. Furthermore, Killian did not object to the authenticity of the Vermont Re-Adoption Decree attached to numerous filings in the case[, ] and there was therefore no need to enter the [Re-Adoption] Decree into evidence.

Orphans' Court Opinion, 9/15/10, at 8 (emphasis added). Our review reveals that the Orphans' Court's rationale is supported by the record and the law. Accordingly, because the Orphans' Court was required by law to give full faith and credit to the Vermont Re-Adoption Decree, Killian's first two issues on appeal do not entitle her to relief, and the Orphans' Court properly granted Trustee's Motion for Nonsuit.

Next, Killian contends that the Orphans' Court abused its discretion by ordering her to pay over $110, 000 to reimburse Trustee and Smith-Ahnert for their attorneys' fees incurred in defending against Killian's action, and by surcharging these fees against Connor's Trust proceeds. See Brief for Appellant at 44-64. Initially, we observe that Killian presents twenty pages of argument in connection with this claim, most of which is in narrative form and contains scant citation to the record and relevant law. In sum, however, Killian argues that the award of attorneys' fees was improper because (1) "Killian acted in good faith, with a reasonable basis in law, and with due diligence throughout the proceedings, " id. at 44 (capitalization omitted); (2) Trustee and Smith-Ahnert failed to give Killian proper notice of their intent to seek attorneys' fees, id. at 62-63; (3) the Orphans' Court failed to provide Killian an adequate opportunity to conduct discovery pertaining to the Attorneys' Fees Petitions and related issues, id. at 49; (4) "Killian [] had a right … to inquire about the underlying purported adoptions [of Bill and Tete Ahnert] in Liberia and also the re-adoptions conducted in 2008 in Vermont, since she had pled fraud, illegality, and inconsistency with [this Commonwealth's] judicial sensibilities[, ]" id. at 48; and (5) the Orphans' Court failed to consider Killian's state of mind and her good faith belief that the Liberian adoptions were invalid, based upon the evidence uncovered by her private investigator, Alan Chertok, id. at 44-45.

Our review of a trial court's award of attorneys' fees is limited. We may only consider whether the court palpably abused its discretion in making a fee award. We may not disturb the award if the record supports the trial court's finding that [the offending party] violated the relevant conduct provision of the Judicial Code. The Judicial Code permits an award of reasonable counsel fees "as a sanction against another participant for dilatory, obdurate or vexatious conduct during the pendency of a matter." 42 Pa.C.S. § 2503(7). Moreover, the court may award counsel fees "because the conduct of another party in commencing the matter or otherwise was arbitrary, vexatious or in bad faith." 42 Pa.C.S. § 2503(9). Such awards represent an attempt to curtail the filing of lawsuits [that] are frivolous or otherwise improper.

In re Barnes Found., 74 A.3d 129, 135 (Pa.Super. 2013) (citations to case law and quotation marks omitted). This Court has held that "[t]he relentless pursuit of a claim which plainly lacks legal merit warrants an award of counsel fees." Id. at 136 (citation omitted). An award of attorneys' fees is also proper where a party's sole purpose of filing suit was to harass and/or annoy the opposing party, with no good faith basis to initiate or maintain the suit. Berg v. Georgetown Builders, Inc., 822 A.2d 810, 816 (Pa.Super. 2003).

In its Opinion, the Orphans' Court thoroughly addressed Killian's claims and correctly determined that the Court properly exercised its discretion in awarding Trustee and Smith-Ahnert reasonable attorneys' fees under 42 Pa.C.S.A. § 2503(7) and (9). See Orphans' Court Opinion, 3/11/13, at 3-7. Our review discloses that the Orphans' Court's well-reasoned analysis is supported by the record and the law, and we may not disturb the Court's credibility determinations. Accordingly, we adopt the Orphans' Court's analysis herein by reference, and we affirm on this basis in rejecting Killian's challenge to the award of attorneys' fees. See id.; see also Orphans' Court Opinion, 10/17/12, at 8-14 (thoroughly setting forth the Orphans' Court's findings in support of its determination that Killian's vexatious and bad faith conduct entitled Trustee and Smith-Ahnert to an award of attorneys' fees, and that the amount of fees claimed by Trustee and Smith-Ahnert was reasonable and supported by competent evidence).[6]

Based upon the foregoing, we affirm the Orphans' Court's March 11, 2013 Decree, which dismissed Killian's Exceptions to the Orphans' Court's grant of the Attorneys' Fees Petitions. In doing so, we discern no error in the Order entered on September 15, 2010, wherein the Orphans' Court denied Killian's Motion for Post-Trial Relief and Exceptions, challenging the grant of nonsuit against her. Finally, we deny Trustee's Motion to Quash.

Decree entered on March 11, 2013 affirmed. Motion to Quash denied. Superior Court jurisdiction relinquished.

Judgment Entered.

(IMAGE OMITTED)


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