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In re Estate of Krasinski

Supreme Court of Pennsylvania

October 31, 2019


          ARGUED: April 9, 2019

          Appeal from the Order of the Superior Court entered May 15, 2018 at Nos. 1289 WDA 2015, 1265 WDA 2015, affirming in part, reversing in part and vacating in part the Order of the Court of Common Pleas of Clearfield County entered July 16, 2015 at No. 1707-0003, and remanding.




         This discretionary appeal presents the Court with an opportunity to clarify the proper scope of Rule 342(a)(6) of the Pennsylvania Rules of Appellate Procedure, which provides for an appeal as of right from an order of the Orphans' Court Division that "determin[es] an interest in real or personal property." Pa.R.A.P. 342(a)(6). Pa.R.A.P. 342(c) further provides that the failure of a party to immediately appeal an order appealable under, inter alia, Rule 342(a)(6), constitutes a waiver of all objections to the order. Pa.R.A.P. 342(c).[1] Applying these rules to the case at bar, we conclude that Appellant Patricia Krasinski-Dunzik ("Dunzik") waived all objections to the orphans' court's order dated April 30, 2013 approving a private sale of land. Accordingly, we affirm the Superior Court's decision.

         Sophia M. Krasinski (the "Decedent") died testate on November 4, 2006. Her will named Edward Krasinski (the "Executor")[2] as the executor of her estate. The Executor is one of the Decedent's four children, who also include Eleanor Krasinski ("Eleanor"), James Krasinski ("James"), and Dunzik. Decedent's will directed that each of her four children were equal beneficiaries of the residue of the estate after debts and funeral expenses were paid. Eleanor relinquished her twenty-five percent interest to Dunzik on January 9, 2013. The primary assets of the estate included three parcels of real estate: (1) twenty acres of property with an appraised value of $55, 000 ("Johnny Hoover Place"); (2) a barn and ninety-five acres of property, including sixty-eight acres of coal rights, with an appraised value of $230, 000 ("Wicks' Place"); and (3) a house, buildings, and approximately ninety-nine acres with an appraised value of $200, 000 ("Homestead Place"). Dunzik and her husband constructed a residence, a barn, and appurtenances on Homestead Place and had lived there for many years at the time of Decedent's death.

         On July 7, 2010, the Executor filed a petition to permit the private sale of real estate to heirs. In that petition, the Executor averred that Dunzik was objecting to the distribution of all three properties because it was her position she already owned them based on a prior oral agreement between herself and the Decedent. After argument and briefing, on March 22, 2011 the orphans' court granted the Executor's petition to permit the private sale of all of the real estate. Specifically, the orphans' court concluded, inter alia, that Dunzik had not produced a writing that satisfied the statute of frauds and thus lacked the legally required proof to support her claim that she owned the properties.

         Dunzik and her husband then filed a civil complaint against the estate based upon the alleged oral contract with the Decedent. On December 24, 2012, after a nonjury trial, the trial court ruled that there was no enforceable oral contract between Dunzik and Decedent and dismissed the case. This trial court's order also lifted a stay on the orphans' court's prior order approving the private sale of the Decedent's lands. Dunzik did not appeal the trial court's rulings.

         On February 8, 2013, the estate's attorney sent a letter to the four heirs explaining the process by which the private sale would occur. With respect to the Homestead Place property, the letter stated that if Dunzik and her husband did not purchase all of the property of Homestead Place, steps would be taken to ensure they could maintain ownership of the home and barn on the property. Specifically, the letter provided that "[t]his sale does not include the home and barn … and if [Dunzik] does not purchase [Homestead Place] an adjustment in real estate will have to be made to allow for the ground under those two buildings to be separately owned and assessed to [Dunzik and her husband]." Orphans' Court Opinion, 4/22/2015, at 9. The bidding took place one week later, on February 15, 2013. The Executor, James and his wife, and Dunzik attended, at which time Dunzik stated that she would not be bidding because she believed that she already owned the properties. She then left the meeting. In her absence, James and his wife bid $230, 000 for Wicks' Place. Edward bid $55, 000 for Johnny Hoover Place. Edward, James and his wife jointly bid $120, 000 for Homestead Place.

         On March 7, 2013, the Executor petitioned the orphans' court to approve the sale of these properties to the residuary heirs for these amounts, attaching the proposed deeds to the three properties as exhibits. Contrary to the representation in the February 8, 2013 letter from the estate's attorney, the deed for Homestead Place did not include any provision permitting Dunzik and her husband to retain ownership of the house and barn. On March 14, 2013, Dunzik filed pro se objections to the petition, which did not include any objection relating to the sale of the properties. On April 30, 2013, the orphans' court, after argument, entered an order approving the sales of the three properties and authorizing the estate to issue the three deeds to the purchasers at the private sale.[3]

         On May 30, 2014, the Executor filed a first and final accounting. Dunzik, through counsel, filed six objections, four of which related to the sales of real property approved pursuant to the April 30, 2013 order. Dunzik first objected to the manner in which the private sale was conducted, including a claim that the Executor and his brother James conspired to purchase the properties for themselves without competitive bidding, thus suppressing the sales prices. Dunzik requested the filing of an amended final accounting that set forth the true value of the real estate. Second, Dunzik objected to the failure to include a limiting condition regarding Petitioner's home, barn, and underlying land in the Homestead Place deed, as promised in the February 8, 2013 letter from the estate's attorney, and that the Executor and James had changed the terms of the sale without proper notice. Dunzik demanded that the estate provide her and her husband with a deed securing their ownership of the lands underneath their house and barn and all surrounding lands appurtenance to the same. Third, Dunzik objected to the placement of a right of way easement over the Homestead Place tract in favor of the Johnny Hoover Place tract, which she claimed increased the value of the Johnny Hoover property (purchased by the Executor). Dunzik insisted that a revised final accounting be prepared that included the correct values for the two properties. Fourth, Dunzik claimed that the Executor had sold lands to himself at artificially reduced prices, which were based upon faulty appraisals that, inter alia, did not include the value of the timber, subsurface rights and Marcellus Shale gas. As with the first and third claims, Dunzik requested that a revised final accounting include the true values of the properties for distribution purposes. Id. at 5-7.

         By order and opinion dated April 22, 2015, the orphans' court denied these four objections, [4] concluding that pursuant to Pa.R.A.P. 342, Dunzik had waived them because she had not filed an appeal in the Superior Court from the April 30, 2013 order (approving the completion of the proposed sales) within thirty days of its entry.

Pennsylvania Rule of Appellate Procedure 342, entitled Appealable Orphans' Court Orders, clearly states that an order from a decree of the [o]rphans' [c]ourt determining an interest in real property is immediately appealable. Failure to appeal such an order constitutes a waiver of all objections to such order and any objections may not be raised in a subsequent procedure. See Rule of Appellate Procedure 342(a)(6) and (c). Therefore, the claims set forth in the first four objections have been waived by [Dunzik] through her failure to file an appeal of this [c]ourt's [o]rder of April 30, 2013.

Id. at 8.

         The orphans' court so ruled despite its acknowledgement that the estate had not followed "acceptable and legal process in conducting the sales" with respect to the Dunzik's house and barn. Orphans' Court Opinion, 4/22/2015, at 8. The court indicated that the excuses given by the Executor and the estate's attorney for not including language in the Homestead Place deed providing for the Dunziks' continued ownership of the land under their house and barn were "woefully inadequate."[5] The court insisted that the Executor had acted in his own interests as co-purchaser of Homestead Place, an act that "some may construe … to be fraud." Id. at 10. Nevertheless, although the orphans' court was of the view that "fundamental fairness dictates a different result," it held that Pa.R.A.P. 342 compelled it to conclude that Dunzik's four objections to the private sale had been waived for her failure to timely appeal.[6]

         By fiduciary deed executed, acknowledged and recorded on May 31, 2013, the Executor conveyed the Homestead tract to himself, James and his wife. In August, 2013, these three individuals joined in the filing of an action in ejectment against Dunzik, her husband and Eleanor (who has resided on Decedent's property her entire life). This action, seeking the removal of the two sisters from their residences, remains pending.

         On appeal, the Superior Court issued an en banc decision on May 15, 2018 in which it, inter alia, affirmed the orphans' court's ruling that Dunzik had waived all objections to the estate's private sale of real estate by failing to appeal from the April 30, 2013 order. In re Estate of Krasinski, 188 A.3d 461, 469-70 (Pa. Super. 2018) (en banc). The Superior Court ruled that the orphans' court's April 30, 2013 order "finalized the sale of real estate by the Executor" and thus clearly "determine[d] an interest in real ... property." Id. at 469. Consequently, the Superior Court held that the orphans' court's April 30, 2013 order was appealable as of right pursuant to Pa.R.A.P. 342(a)(6) and Dunzik's failure to appeal within thirty days of its entry resulted in a waiver of all claims related to the sale pursuant to Pa.R.A.P. 342(c).[7] Id. at 469-70. Judge Shogan issued a dissenting opinion.

         This Court granted allowance of appeal to consider the following issues:

(1) Does Pa.R.A.P. [...] 342(a)(6), which provides for an immediate appeal as of right from Orphans' Court orders "... determining an interest in real or personal property[, "] also allow or require an immediate appeal from an order of the Orphans' Court permitting or denying the personal representative the authority to sell real or personal property, such that filing the appeal from the Order confirming the [f]irst [and] [f]inal account was deemed to be a waiver of those issues?
(2) Did the Superior Court commit an error of law, and misconstrue Pa.R.A.P. [...] 342(a)(6) in its holding that an order confirming the sale of real property of a decedent's estate was an order determining an interest in real property, and that an appeal from such an order was waived if not filed within thirty [...] days of said order?
(3) Did the Superior Court commit an error of law by misconstruing Pa.R.A.P. [...] 342(a)(6), and ignoring, or otherwise failing to address controlling authority encompassed by the Superior Court decisions and holdings in In re Estate of Ash, 73 A.3d 1287 (Pa. Super. 2013), and In re Estate of Cherry, 111 A.3d 1204 (Pa. Super. 2015)?

In re Estate of Krasinski, 198 A.3d 1045 (Pa. 2018). While set forth in three distinct formulations, at bottom these issues present a single question for this Court's consideration: did the orphans' court's April, 30, 2013 order determine an interest in real property in accordance with Pa.R.A.P. 342(a)(6), and, if so, did Dunzik's failure to appeal within thirty days result in a waiver of all claims related to the sale of real property pursuant to Rule 342(c). The proper interpretation of a rule presents a question of law and our standard of review is de novo. Touloumes v. E.S.C. Inc., 899 A.2d 343, 346 n.4 (Pa. 2006). Our scope of review, to the extent necessary to resolve the legal question before us, is the entire record and is thus plenary. Id.

         Prior to 1992, a "final order" for purposes of appeal was not precisely defined in the Pennsylvania Rules of Civil Procedure. Rather, the finality of an order was generally governed by appellate court decisions holding that the order had a "final aspect" to it.[8]The "final aspect" approach was useful for parties in orphans' court proceedings, as a large number of orders issue by these courts resolved specific issues, like the rights of beneficiaries and the disposition of real or personal property, but did not terminate the entire administrative proceeding. In 1992, however, this Court adopted Pa.R.A.P. 341, which defines a "final order" as one that disposes of all claims and of all parties. Pa.R.A.P. 341(b)(1). As a result of this change, many orphans' court orders that would have been appealable under the "final aspect" doctrine were no longer appealable, as only the order approving the final accounting disposes of "all claims and all parties." This new definition of "final order" proved to be problematic to orphans' court practice, including for example with respect to the disposition of real estate. Personal representatives (including executors), guardians and trustees had typically sought the finality of orphans' court approval of real estate transactions pursuant to section 548 of the Fiduciaries Act of 1949 (now section 3353 of the Probate, Estates and Fiduciaries Code, 20 Pa.C.S. § 3353[9]). Because after 1992 orders approving dispositions of real estate were no longer immediately appealable, the finality of such transactions remained uncertain until after the orphans' court had approved a final accounting for the entire estate. It was often difficult for a personal representative, given the uncertainties associated with potential future appeals, to obtain results consistent with the interests of the estate's beneficiaries.

         As of 1992, Pa.R.A.P. 342 permitted interlocutory appeals as of right from orphans' court orders in only one circumstance: non-final orders of distribution. The rule further required that such an order was appealable only if "the lower court shall certify that the order is sufficiently definite to determine the substantive issues between the parties." See In re Estate of Habazin, 679 A.2d 1293, 1295 (Pa. Super. 1996), abrogated by amendments to Pa.R.A.P 342. In 2000, in part to address the difficulties just discussed, the Court amended Pa.R.A.P. 342 to include two additional types of orphans' court interlocutory orders appealable as of right: (1) orders "determining an interest in realty, personalty," and (2) an order determining the status of individuals or entities. In re Estate of Sorber, 803 A.2d 767, 769 (Pa. Super. 2002), abrogated by amendments to Pa.R.A.P 342. The revised rule continued to retain the requirement that the orphans' court certify the ruling as final before an appeal could be filed, modifying the language slightly to require that the order "shall constitute a final order upon a determination of finality by the Orphans' Court Division." Id. In 2005, the rule was amended again as follows:

         Rule 342. Orphans' Court Orders Appealable. Orders Determining Realty, Personalty and Status of Individuals or Entities. Orders Making Distribution.

An order of the Orphans' Court Division making a distribution, or determining an interest in realty or personalty or the status of individuals or entities, shall be immediately appealable:
(1) upon a determination of finality by the Orphans' Court Division, or
(2) as otherwise provided by Chapter 3 of these rules.[10]

Pa.R.C.P. 342 (footnote added).

         This Court addressed the application of this rule in In re Estate of Stricker, 977 A.2d 1115 (Pa. 2009). In Stricker, two tracts of land constituted the bulk of the decedent's estate and the will provided that they be sold for the benefit of ten beneficiaries. There were two co-executors, one of whom was the appellant. One tract was subject to a third party's option to repurchase the property, which the third party had exercised. The remaining tract was put up for auction. The appellant co-executor participated in the auction, but another bidder (John Fulton) entered a considerably higher bid. The orphans' court directed the estate to deliver that tract to Fulton, but the appellant refused to cooperate in transferring either tract. The orphans' court entered an order to compel the appellant to sign the agreement of sale transferring the tract purchased by Fulton, and did not certify any of its orders as final. The Superior Court ...

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