IN RE:TRUST CREATED UNDER THE WILL OF WILLIAM J. COHEN DATED OCTOBER 18, 1946 IN RE:TRUST UNDER AGREEMENT OF WILLIAM J. COHEN DATED FEBRUARY 24, 1947 APPEAL OF: BIBLE PRESBYTERIAN CHURCH OF CHESTER
from the Order Entered August 9, 2017 In the Court of Common
Pleas of Delaware County Orphans' Court at No(s):
BEFORE: SHOGAN, J., NICHOLS, J., and STEVENS, [*] P.J.E.
Presbyterian Church of Chester ("Bible Church")
appeals from the order entered August 9, 2017, in the Court
of Common Pleas of Delaware County, overruling its objections
to the cy pres petition of Crozer-Chester Medical
Center, Inc. ("CCMC, Inc."). We affirm.
orphans' court provided the following summary of this
On August 7, 2017, this court convened a hearing to dispose
of a cy pres petition arising from a Trust created
under the residuary clause of the Will of William J. Cohen
dated October 18, 1946 and of the Trust Agreement of February
24, 1947 ["Cohen Trust"]. The designated Trust
beneficiaries (Third Presbyterian Church of Chester, [Bible
Church] (also located in Chester), Church of the Open Door
(located on York Road in Philadelphia) and Chester Hospital)
were to split equally the net income derived from the residue
of the decedent's estate.
The matter came before this court based upon a Petition of
CCMC, Inc. formerly known as Crozer-Chester Medical Center
[s]eeking [r]elief [p]ursuant to the Doctrine of Cy
Pres. By way of background, CCMC, Inc. was the late
operator of Crozer-Chester Medical Center which, in turn,
based upon an adjudication of the court back in 1964,
succeeded to the interests of Chester Hospital. Over the
intervening years, CCMC, Inc., acquired interests in other
medical facilities around Delaware County. Most recently,
effective on or about July 1, 2016, a sale of the assets of
CCMC, Inc., to a for-profit entity, Prospect Health, resulted
in a reincarnation of a non-profit, Crozer Chester Foundation
into Crozer Keystone Community Foundation ("CKCF")
which is now using the former's tax identification
number. At the same time, CKCF absorbed Delaware County
Memorial Hospital Foundation. CKCF was identified as the
principal recipient of the proceeds from the asset sale.
* * *
The issue presented for disposition derives from the changed
circumstances. Chester Hospital, one of this trust's
original beneficiaries has long been in the rearview mirror.
But the vision of the deceased was carried forward through
CCMC, Inc. The cy pres petition seeks to allow CKCF
to continue the legacy of Chester Hospital and CCMC, Inc.
* * *
However, while two of the three other beneficiaries of the
Cohen Trust posed no objection to the cy pres
petition, one of the other Trust beneficiaries, [Bible
Church], contested the proposed application of the cy
pres doctrine which would permit the change of
beneficiary to the newly created entity, CKCF. Instead,
[Bible Church] asserted that the termination of the
eligibility of CCMC, Inc. to receive the largesse from the
Trust constituted a lapse thereby requiring the Trust to
divide the one-quarter share originally allocable to Chester
Hospital, among the other three entities.
Court Opinion, 11/20/17, at unnumbered 1, 2. The orphans'
court overruled Bible Church's objections and granted the
cy pres petition, thereby allowing CKCF to receive
the one-quarter share of net income originally allocated to
Chester Hospital in 1946 and 1947 and distributed to CCMC,
Inc. since 1964. Bible Church appealed. The orphans'
court and Bible Church complied with Pa.R.A.P. 1925.
Church states the questions involved as follows:
1) May the court award a residuary share in trusts to an
independent charitable corporation with different functions
rather than to the remaining residuary beneficiaries when the
charity originally named as one of four residuary
beneficiaries no longer qualifies to receive such funds?
2) Did the Trial Court err in granting the Petition Seeking
Relief Under the Doctrine of Cy Pres and modifying the Trust
to provide that the bequest to Chester Hospital now may go to
[CKCF] rather than the remaining beneficiaries[?]
Church's Brief at 8.
standards guide our review. "When reviewing a decree
entered by the [o]rphans' [c]ourt, this Court must
determine whether the record is free from legal error and the
court's factual findings are supported by the
evidence." In re Shoemaker, 115 A.3d 347, 354
(Pa. Super. 2015) (quoting In re Estate of Whitley,
50 A.3d 203, 206 (Pa. Super. 2012) (citation omitted)).
Because the orphans' court sits as the fact-finder, it
determines the credibility of the witnesses, and on review,
we will not reverse the orphans' court's credibility
determinations absent an abuse of discretion. Id. at
354-355 (citation omitted). "However, we are not
constrained to give the same deference to any resulting legal
conclusions." Id. at 355 (quoting
Whitley, 50 A.3d at 207 (citations omitted)).
"The [o]rphans' [c]ourt decision will not be
reversed unless there has been an abuse of discretion or a
fundamental error in applying the correct principles of
law." Id. (quoting Whitley, 50 A.3d at
207 (citation omitted)).
Church first argues that the orphans' court abused its
discretion by awarding Chester Hospital's residuary share
of the Cohen Trust to an independent charitable corporation
with non-hospital functions. Bible Church's Brief at 13.
Specifically, Bible Church contends that, because Chester
Hospital no longer exists and CCMC, Inc. is an ineligible
beneficiary, the residual one-quarter share of the Cohen
Trust should have been distributed equally to the three
remaining beneficiaries. Id. at 15. In support of
its position, Bible Church relies on Pennsylvania's
Decedents, Estates and Fiduciaries ("DEF") Code, 20
Pa.C.S. §§ 101-8815, specifically, Section 2514(9),
(10), and (11). Bible Church further argues that Mr.
Cohen's purposes are not frustrated by the fact that
Chester Hospital no longer exists. Bible Church's Brief
at 16. According to Bible Church:
what is clear from the Will and Trust under Agreement is that
Cohen intended the gift to go to four specific beneficiaries.
It is logical, therefore, and required by Section 2514, that
if one of the beneficiaries is no longer able to accept the
gift the gift should be distributed to the remaining
Id. at 17.
response, CCMC, Inc. contends that Section 2514:
could not be clearer in its mandate that none of the three
[sub]sections applies to the Cohen [Trust]. 20
[Pa.C.S.] §2514(9) applies only to individuals;
§2514(10) applies to bequests which are not part of the
residuary estate; and §2514(11) applies where the
disposition in question shall not be otherwise expressly
provided for by law. In the Cohen [Trust], the
relevant beneficiaries are charitable institutions, not
individuals, and therefore the distribution scheme described
in §2514(9) does not apply. Likewise, the Cohen
[Trust] bequests are residuary, and therefore are not subject
to §2514(10). Finally, the requirements of
§2514(11) are also not applicable here, because the
Cohen Trust bequests are already otherwise expressly
provided for by law, namely 20 [Pa.C.S.] § 7740.3, which
articulates the doctrine of cy pres.
Inc.'s Brief at 10.
with CCMC, Inc., the orphans' court rejected Bible