Paloskey, E.P. v. Hagerman, J.A., 732 MDA 2016

Edward and Donna Paloskey executed general powers of attorney naming family members, including appellee Jennifer Hagerman, as attorneys-in-fact; the POA executed June 9, 2011 was revoked July 30, 2012.
Appellant E. Paul Paloskey (their son) petitioned for an accounting alleging improper charges by Jennifer while she acted as POA; Jennifer filed an initial incomplete accounting and, after the court appointed counsel, a second accounting.
The Orphans’ Court held a hearing, found numerous personal and questionable charges on the principals’ accounts (e.g., veterinary bills, personal subscriptions, pharmacy charges, retail purchases) and numerous instances where Jennifer signed checks as “POA.”
The court found Jennifer breached fiduciary duties (failed to keep assets separate, maintain records, and act solely for principals’ benefit) but credited her testimony and documentation on many disputed items.
The court surcharged Jennifer $1,214.43, ordered reimbursement to Clinton County for attorney fees (with a credit for amounts already paid), and vacated the appointment of her counsel; appellant sought reconsideration and appealed.

Issue	Paloskey's Argument	Hagerman's Argument	Held
Whether appellee should be surcharged for all undocumented expenditures (~$53,173.80)	All undocumented withdrawals/charges should be charged to Hagerman; documented expenditures only ~$7,348.52, leaving large balance	Trial court-recorded testimony and limited documentation justified many items; appellant failed to rebut credibility findings	Court affirmed: appellant failed to show trial court abused discretion; surcharge limited to items supported by findings ($1,214.43)
Burden of proof re: fiduciary disbursements (whether burden shifted to appellee to justify expenditures)	Once prima facie wrongful conduct shown, burden shifts to Hagerman to justify expenditures; she failed for many items	Hagerman provided explanations/documentation for many disbursements and was found credible by trial court	Court applied settled law (burden shifts after prima facie showing) and held trial court permissibly credited appellee where evidence supported her explanations

In re Estate of Miller, 18 A.3d 1163 (Pa. Super. 2011) (standard of review for Orphans’ Court factual findings and legal conclusions)
In re Wade’s Estate, 343 Pa. 520 (Pa. 1942) (trial court’s surcharge amount evaluated for abuse of discretion)
In re Estate of Brown, 30 A.3d 1200 (Pa. Super. 2011) (affirming standard for surcharge review)
Estate of Lohm, 269 A.2d 451 (Pa. 1970) (fiduciary negligent losses may be surcharged)
In re Estate of Schultheis, 747 A.2d 918 (Pa. Super. 2000) (surcharge compensates beneficiaries for fiduciary’s lack of due care)
Strickler Estate, 47 A.2d 134 (Pa. 1946) (fiduciary bears burden to justify disbursements; unsupported testimony generally insufficient)