Matter of Estate of Albert, F., Appeal of Pezulla
Matter of Estate of Albert, F., Appeal of Pezulla No. 1550 WDA 2015
| Pa. Super. Ct. | Feb 22, 2017Background
- Testator Frank W. Albert died in 1972, leaving a will (11/23/68) that devised the residuary estate one-third to his wife and two-thirds to be split among his three daughters, and contained a clause: if his "farms" could be profitably operated, his wife and daughters should operate them; if not, sell and divide proceeds per the will.
- Estate inventory listed 14 parcels (three townships), totaling varied acreage: some active farms, some rented buildings (including an airstrip/hangar), and some wooded/untillable land.
- Appellant Anna Mae Pezzulla (executrix and daughter) managed and controlled all 14 parcels from 1972–2012, selling farm equipment in 1972 and operating primarily by leasing, collecting rents, royalties, timber/coal proceeds; she conceded she did not personally farm.
- One residuary beneficiary, Stanley Myers (heir of deceased daughter Doris), filed exceptions to the executrix’s third partial account (1975–2012), arguing the farms clause was exhausted and estate assets should be distributed.
- The orphans’ court found the will’s term "farms" unambiguous (limited to actual farms), required operation as farms (not merely leasing), and concluded the properties were not being profitably farmed; it ordered termination of administration and distribution to residuary beneficiaries.
- Superior Court affirmed: the will unambiguously limited the clause to actual farms, rejected extrinsic evidence to expand the term, and held the land was not being profitably operated as required.
Issues
| Issue | Plaintiff's Argument (Pezzulla) | Defendant's Argument (Myers) | Held |
|---|---|---|---|
| Scope of "farms": whether clause covers all real estate or only actual farms | "Farm" meant all of decedent's realty; clause authorizes her to manage all parcels | Clause refers only to decedent's farms (ordinary meaning) and does not cover non-farm realty | Term "farms" is unambiguous and limited to actual farms; clause does not cover all real estate |
| Required manner of operation: must the property be operated as farms (by them) vs. leased or managed for income | Managing, leasing, and generating income satisfies clause; no requirement to personally engage in farming | Clause requires operating the farms as farms (i.e., the daughters/wife themselves engage in farming), not merely renting or passive management | The will requires operation as farms; leasing out parcels does not satisfy the testator's instruction |
| Profitability standard: was Appellant profitably operating the farms so as to continue administration | Appellant managed properties profitably overall for upkeep and taxes over decades | Several years showed no distributions; one year required sale of land to cover expenses—thus not profitably operated | Not profitably operated: multiple years without distributions and a sale to cover expenses justify ending administration |
| Authority to control assets alone after co-beneficiaries died or interests passed | As executrix she had authority to continue sole stewardship and manage estate assets | The will contemplated joint operation by wife and three daughters; sole long-term control to exclusion of beneficiaries is improper | Executors cannot indefinitely retain control to the exclusion of residuary beneficiaries; sole long-term control contrary to will and equities supports distribution |
Key Cases Cited
- In re Fiedler, 132 A.3d 1010 (Pa. Super. 2016) (standard of review for orphans' court factual findings and credibility)
- Estate of Smertz, 701 A.2d 268 (Pa. Super. 1997) (testator's intent is the polestar in will construction; start with will's language)
- Estate of Getz, 618 A.2d 456 (Pa. Super. 1992) (distinguishing clauses that allow continuation of "farming operation, business or other enterprises")
Order affirmed.