IN THE MATTER OF THE ESTATE OF MARY JANE LYNCH (P-07-788, GLOUCESTER COUNTY AND STATEWIDE)
A-5617-14T2
| N.J. Super. Ct. App. Div. | Nov 8, 2017Background
- Decedent Mary Jane Lynch died in 2007; her will/trust divided assets between her two children, Deborah Williams and John Lynch, who were co-trustees and co-executors (Williams renounced executorship early). The estate included a house, personalty, bank accounts, and stock held in a family trust.
- Disputes emerged over the house value, distribution of personalty, transfers from bank and margin accounts, and checks written by John while handling Mary Jane’s finances; Williams sought accounting, removal of John as executor, and recovery of alleged misappropriations.
- Lynch filed for approval of a final accounting in 2011; the court approved a revised accounting in June 2012 disallowing certain items and imposing surcharges against both siblings for inter vivos transfers, and reserved other issues for further submissions and mediation.
- Williams later sought removal of Lynch (first for health reasons, later for fiduciary breaches), forensic accounting fees, and further discovery; mediation failed and motions were decided in a June 2, 2015 opinion and a June 30, 2015 final order closing the estate.
- The trial court awarded attorney fees to the estate’s counsel, an executor’s commission to Lynch, approved payment for a forensic accountant to Williams, and assessed and offset surcharges between the parties; both parties appealed limited aspects.
- The Appellate Division affirmed the orders except it modified the monetary amounts of the surcharges: reducing Williams’ surcharge to $8,400 (admitted withdrawal) and reducing Lynch’s surcharge by excluding $22,500 in checks signed by Mary Jane, resulting in a modified Lynch surcharge of $110,000.
Issues
| Issue | Plaintiff's Argument (Williams) | Defendant's Argument (Lynch / Estate) | Held |
|---|---|---|---|
| Whether an evidentiary hearing/removal hearing was required on alleged malfeasance and for removal of executor | Williams: factual disputes and allegations of fiduciary breaches required a plenary evidentiary hearing and removal | Lynch/Estate: issues were either not pled in a complaint, were outside the probate accounting, or were too late; summary resolution appropriate | Court: no abuse of discretion; no evidentiary hearing required on unpled/non-probate claims; allowed Williams to file separate suit for pre-death/trust claims |
| Validity and amount of surcharges for inter vivos transfers from decedent’s accounts | Williams: court erred in surcharging her $47,000; accounting unsupported | Lynch: both admitted taking funds; funds were Mary Jane’s so transfers required repayment | Court: surcharge concept valid; modified amounts—Williams surcharged $8,400 (admitted); Lynch surcharge reduced by excluding $22,500 in checks actually signed by Mary Jane; remainder affirmed |
| Approval of estate attorney’s fees and apportionment between estate and Lynch personally | Williams: fees should be apportioned; she objected later on appeal | Lynch/Estate: counsel retained for estate; no personal claims against Lynch in probate so fees properly charged to estate | Court: no abuse of discretion; fees to Puff & Cockerill allowed for the estate; issue waived where not timely objected to |
| Award of executor’s commission to Lynch | Williams: commission should be denied due to alleged misconduct | Lynch/Estate: entitled to statutory commission; no direct claims reducing commission | Court: awarding commission was within discretion; no abuse absent direct claims against Lynch in this proceeding |
Key Cases Cited
- Donnelly v. Ritzendollar, 14 N.J. 96 (1953) (laches does not necessarily bar claims against fiduciaries for breach predating probate)
- In re Estate of Perrone, 5 N.J. 514 (1950) (burden on exceptant to prove assets omitted from accounting with reasonable certainty; donative intent must be proved)
- In re Estate of Folcher, 224 N.J. 496 (2016) (discussion of Rule 4:42-9 fee-shifting principles in probate context)
- Mears v. Addonizio, 336 N.J. Super. 474 (App. Div. 2001) (standards for appellate review of attorney-fee awards; abuse of discretion review)
- In re Estate of Moore, 50 N.J. 131 (1967) (executor’s commission review under abuse of discretion)
- Nieder v. Royal Indem. Ins. Co., Inc., 62 N.J. 229 (1973) (appellate courts generally decline issues not raised below)
- Higgins v. Thurber, 205 N.J. 227 (2011) (describing the formalistic, summary nature of probate accounting proceedings)