IN RE: ESTATE OF PETER J. CARUSO, III, DECEASED APPEAL OF: GERALDINE CARUSO
from the Order Entered October 18, 2016 In the Court of
Common Pleas of Allegheny County Orphans' Court at No(s):
3623 of 2015
BEFORE: BOWES, LAZARUS, AND OTT, JJ.
Caruso appeals from the October 18, 2016 order granting
summary judgment in favor of Sandra A. Caruso, the Executrix
of the Estate of Peter J. Caruso, III,
("Executrix") in this equity action. After thorough
review, we reverse the grant of summary judgment and remand
for further proceedings consistent with this opinion.
commenced this action against Executrix in the Court of
Common Pleas of Allegheny County. In her complaint, she
alleged the following. Hays Land Company ("HLC")
was a general partnership formed on or before December 12,
1983. The original partners were Mary Ann Caruso and her
sons, Peter J. Caruso, III, and John D. Caruso,
Geraldine's deceased husband. On December 31, 1997, Mary
Ann sold her interest in the Partnership to the remaining
partners in equal shares, and Peter and John operated it
until John's death in 2003. Geraldine pled that,
thereafter, she and Peter were general partners each owning a
fifty percent interest in HLC.
died on May 18, 2015. Geraldine averred that at the time of
Peter's death, the 1983 Partnership Agreement was in full
force and effect. In accordance with the Agreement's
buy-sell provision governing dissolution upon the death of a
partner, Geraldine notified Executrix that she intended to
purchase Peter's partnership interest. That provision
stated that, upon dissolution due to the death of a partner,
the "remaining Partner shall have the obligation within
ninety (90) days from the date of death of the deceased
Partner to purchase the interest of the deceased Partner in
the Partnership and to pay to the personal representative of
such deceased Partner the value thereof . . ."
Complaint, at ¶20.
calculated that the sum of $117, 762.50 was due for
Peter's interest, and she tendered the first of nine
payments towards the purchase on August 12, 2015. On that
same date, counsel for Executrix advised Geraldine's
counsel that the 1983 Partnership Agreement was not in effect
at Peter's death, and returned the check. Geraldine pled
that she was "ready, willing, and able to purchase the
partnership interest of Peter, " as required under the
terms of the Partnership Agreement, but that Executrix
"has refused, and continues to refuse to honor" the
duty to sell. Id. at ¶¶ 34, 35. Geraldine
asked the court to order Executrix "to perform
specifically the provisions of the Partnership Agreement as
they relate to the sale and purchase of the deceased
Partner's interest." Id. at ¶ 36.
count II, Geraldine pled that Peter formed a limited
liability company known as Hays Land Company-Pittsburgh, LLC.
Id. at ¶40. On or about April 30, 2015, without
her knowledge, he executed a Joint Written Consent of Partner
and Member in Lieu of Meeting on behalf of the Partnership,
purporting to merge the Partnership with the newly-formed
LLC. She alleged that Peter did not have the authority under
the law or the Partnership Agreement to cause the merger, and
she asked the court to declare the merger null and void.
Id. at ¶¶49, 50, 51.
filed an answer and new matter in which she averred that the
original partnership was dissolved upon the death of John D.
Caruso, and that Geraldine and Peter formed a new partnership
that was not governed by any agreement. Answer, ¶ 7. She
alleged that the Partnership Agreement and, specifically, the
buy-sell provision, had no application to the second
partnership formed by Peter and Geraldine. Moreover, she pled
that when Peter merged the HLC partnership into the LLC on or
about April 30, 2015, Geraldine's fifty percent interest
in the partnership was exchanged for a fifty percent interest
in the LLC. As a result of the merger, all assets of the
Partnership were held by the LLC as of Peter's death.
Finally, Executrix pled that Peter was within his rights to
execute the Joint Consent and to merge the Partnership into
filed a motion for summary judgment on September 1, 2016, in
which she asserted the Dead Man's Act prevented Geraldine
from offering oral testimony regarding the nature of her
agreement with Peter, and thus effectively precluded
Geraldine from proving her case. Geraldine opposed the
motion, but the court granted summary judgment on October 17,
2016, without a hearing. Geraldine timely appealed and raises
two questions for our review:
I. Did the trial court abuse its discretion and commit an
error of law in granting the Estate's motion for summary
judgment when there was substantial evidence, including
admissions by the Decedent, that the partnership agreement
remained in full force and effect?
II. Did the trial court abuse its discretion and commit an
error of law in deciding that one partner, having 50%
ownership interest in the partnership, could make fundamental
changes to the partnership unilaterally, without the other
50% partner's knowledge or consent?
Appellant's brief at 4 (unnecessary capitalization
judgment can be entered "only in those cases where the
record clearly demonstrates that there is no genuine issue of
material fact and that the moving party is entitled to
judgment as a matter of law." Summers v. Certainteed
Corp., 997 A.2d 1152, 1159 (Pa. 2010) (quoting
Atcovitz v. Gulph Mills Tennis Club, Inc., 812 A.2d
1218, 1221 (Pa. 2002). When the trial court considers such a
motion, it must view "all facts of record and all
reasonable inferences therefrom in a light most favorable to
the non-moving party[, ]" and "resolve all doubts
as to the existence of a genuine issue of material fact
against the moving party." Id. Summary judgment
is properly granted only "where the right to such
judgment is clear and free from all doubt." Id.
scope of review of an order "granting or denying summary
judgment is plenary, and our standard of review is clear: the
trial court's order will be reversed only where it is
established that the court committed an error of law or
abused its discretion." Universal Health Services,
Inc. v. Pennsylvania Property and Casualty Insurance Guaranty
Assoc., 884 A.2d 889, 892 (Pa.Super. 2005) (citation
omitted). "We examine the record, which consists of all
pleadings, as well as any depositions, answers to
interrogatories, admissions, affidavits, and expert reports,
in a light most favorable to the non-moving party, and we
resolve all doubts as to the existence of a genuine issue of
material fact against the moving party." LJL
Transp., Inc. v. Pilot Air Freight Corp., 962 A.2d 639,
647 (Pa. 2009) (citations omitted).
the issue of whether there are genuine issues of material
fact is a question of law, our standard of review on that
issue is de novo, and we need not defer to the
determination of the trial court in this regard. Id.
Furthermore, in resolving a question of law, we review the
issue in the context of the entire record. Weaver v.
Lancaster Newspapers, Inc., 926 A.2d 899, 903 (Pa.
principles regarding general partnerships inform our review.
Under the Uniform Partnership Act ("UPA"), whether
a partnership exists depends upon whether the parties
intended to be parties. No formal or written agreement is
required. Murphy v. Burke, 311 A.2d 904 (Pa. 1973).
A partnership may be found to exist by implication from the
circumstances and manner in which the business was conducted.
DeMarchis v. D'Amico, 637 A.2d 1029 (Pa.Super.
1994). Furthermore, under Pennsylvania's UPA, a
partnership was not a legal entity separate from its partners
and had no residence or domicile distinct from that of its
partners. "It is rather a relation or status
between two or more persons who unite their labor or property
to carry on a business for profit." Svetik v.
Svetik, 547 A.2d 794, 797-798, (Pa.Super. 1988) (quoting
Tax Review Board of the City of Philadelphia v. D.H.
Shapiro Co., 185 A.2d 529, 533 (Pa. 1962)).
we note the following. There is no dispute that Geraldine and
Peter were partners in HLC at the time of the purported
merger on or about April 30, 2015. Geraldine maintained that
neither the UPA nor the Partnership Agreement authorized
Peter's unilateral merger of the Partnership into the
LLC, and hence, the merger was null and void. The trial court
concluded that, since partners "have equal rights in the
management and conduct of the partnership business[, ]"
the Dead Man's Act would bar Geraldine from producing any
evidence that Peter could not have legally merged the
partnership into the LLC unilaterally, and thus, summary
judgment was ...