*2 NIX, C.J., LARSEN, Before FLAHERTY, zappala jj. McDermott, papadakos,
OPINION OF THE COURT PAPADAKOS, Justice.*
Mary Evasew died September 28, 1985, testate on desig- nating her seven children as residuary beneficiaries includ- ing children, her Holeva, Helen Alexander Evasew and Robert Evasew. Helen appointed Holeva was Executrix of the estate and was authorized by decedent’s will to sell any estate property “for such price prices and upon such she, terms discretion, and conditions as in her sole may (Record deem Oa). best.” death, At the time of her estate, decedent owned parcels two of real property situate on Church Street and a farm Charleston Township, County. Chester In an effort to settle the promptly, estate the Executrix decided to sell properties. her, both To assist the Executrix hired J. Puleo appraise and Sons to both properties for estate tax purposes engaged them to sell the Church time, Street At this property. the Executrix was already undertaking negotiations prospective with a buyer for the purchase Appellant, of the farm. acting on Sons, behalf J. Puleo and appraised the farm at between * reassigned This case was to this writer. Negotiations for the sale of the farm $80,000.1
$65,000 during process Appellant It was this protracted. were conversation between the Executrix telephone overheard buyer in which the offered buyer and a prospective $75,000 Thereafter, purchase Appellant for farm. offered requested for which the Executrix be property $81,000 to the the es- writing attorney representing submitted tate. tendered, offer a second Appellant’s appraisal
After from a different was received. This appraiser for the farm list for the suggested price farm between appraisal $145,- trial later on the court concluded $160,000. appraisals that the independent basis of worth Appellant. spite far than the offered more $81,000 the Executrix entered appraisals, the disparity between Appellant for the agreement into an sale with the $81,000.2 *3 then this liti- and Alexander Evasew commenced
Robert
Real
filing
“Petition to Restrain Sale of
Estate
gation by
In
Code,
under PEF
Sec.
P.C.S.
(20
3360).”
3353
3360
alleged,
this
Robert
Alexander Evasew
inter
petition,
alia,
acceptance
the
of his sales
Appellant procured
that
fraud,
through
by
the farm
agreement
purchase
the
of
his
the Executrix of the fair market value
failure
advise
himself;
the
property
the
that
by Appellant buying
mistake;
the
procured through
was
decedent’s
property
of
tainted as a result of
conflict
the transaction was
agent
as
for the estate with
Appellant,
interest between
one
regard
buyer
the
Street
and as
of
property,
Church
assets.
principal
its two
granted
petition,
the
court
the
Following hearings,
trial
Pa.Superior
in
relying
part upon
Hughes,
the Estate of
357
part upon
in
the trial
Ct.
A.2d
(1986),
581
relationship existed be-
finding
court’s
that a confidential
eventually
and is
the
1.
sold
not
The Church Street
was
subject
appeal.
of this
Triple
Appellant
the
Farms of which
was
2. The actual sale
with
T
was
principal owner.
Appellant
Appellant
the
and the Executrix and that
tween
that confidence. The
affirmed
Superior
breached
Court
on the
the
summarily
opinion.
basis of
trial court’s
addition,
Pa.Superior Ct.
Although
upon
the estate and the lower court relied
Code, 20
Fiduciary
Section 3355 of the Probate and
P.C.S.
3360(a)
3355,
held that
of the
Section
we
Section
Code was
3360(a)
controlling.
“clearly
unambiguously
Section
fraud,
may
states that
accident or mistake a court
absent
to sell
The
agreement
not set aside an
estate
...
in
legislature
enacting
this statute was to
intent
being put
being super
from
in the
of
prevent
position
courts
executors/administrators,
essentially private
to leave
in the hands of the
transactions
individuals involved.”
415,
There Appellant and the relationship between confidential of a confidential fiduciary, a Executrix, Evasew. Where Mary exists, following apply. rules the unequal or presumed, fraud is not rule Although general as a party on the who establishing it rests the burden relaxed cases where it, rule is somewhat alleges that to a'transac- parties the relation between fiduciary exists contract, has a dominant and and where one or tion influence In such over the other. force or controlling benefit, possible cases, party if obtains superior the of the against validity the presumption raises a equity contract, the upon party casts such transaction fairness, honesty, integrity proving burden that there was no contract. He must show transaction or faith, confidence, good he has acted that abuse free, the act which he benefited and that party, of the other done independent act voluntary, Moreover, and effect. knowledge purpose of its with full con- the relations held that where it has been of such a character as appear to be tracting parties on terms of do not deal they render it certain that knowledge of superior party’s that from one equality, but relationship, or from fiduciary from a the matter derived influence, weakness, or trust dependence, overmastering in the transaction is advantage unfair reposed, justifiably void, presumed transaction probable, made stronger to, upon, incument and it is is shifted burden deception prac- no that party affirmatively to show fair, and well open, voluntary, ticed and that all was seeking profit fiduciary said that a understood. It is in him has the confided the one who by a transaction with other, to the he communicated showing burden transaction, interest in the all the fact of his but only not it important he had which was other information him judge to enable of the value of to know order *6 Thus, par- if a transaction between the property. his confidence, in a of trust and stand ties who the confidence is an reposed obtains party the whom other, he advantage presumed over is apparent if advantage fraudulently; and he obtained have transaction, he must assume the support seeks to advantage that he has taken no of his proof burden fair knowledge arrangement and that is influence conscientious. and also, 2d, Deceit, 441. Am Fraud and Section See
37
Jur
(1878);
Ap
Audenreid’s
Pa. 512
Darlington Appeal,
86
Welsh, 295 Pa.
501, 145
Harrison v.
(1879);
Court
is one of trust
persons
the relationship
When
confidence,
the trust and confi-
party
whom
fairness and
reposed
scrupulous
are
must act with
dence
refrain from
dealings
in his
the other and
good faith
with
detriment and his own
his
to the other’s
using
position
Fraser,
561,
105
Fraser,
McCown v.
(1922).
also
supra,
See
327 Pa. at
A. at 676.
192
impossible
“It is
define
what constitutes a
precisely
Fraser,
relation.”
supra,
McCown v.
confidential
327 Pa.
A.
at
at 676.
It is not restricted to any specific
persons
association of
nor confined to technical cases of
fiduciary
but
deemed to exist whenever the
position
parties
relative
power
such that one has
and means to take
advantage
or exercise undue influ-
Fraser,
ence over the other. McCown v.
supra; Longe-
Church,
necker v. Zion
Evangelical Lutheran
Pa.
[50]
A.
(1901).
Accordingly, a confidential rela-
tionship
exists
generally
que
“between trustee and cestui
trust,
ward,
client,
guardian
attorney and
and princi-
Palmer,
agent.” Leedom v.
supra,
pal
[at]
25,
Breach of the confidential amounting fraud, law to or implied constructive inferred properly merely inadequacy Appellant’s from the of offer on the in comparison higher farm with the appraisal inexplicably ignored comparison the Executrix and in by with what higher trial court found to be the substantially value property. The rule is as follows:
The fact one in confidence reposed by that whom another apparent advantage obtains an over the latter in a transaction them is a vital factor in raising of fraud on
presumption part or one in fiduciary relationship. Moreover, confidential the unfairness of a transaction or the inadequacy consideration is itself factor from inferred, a which fraud can be and such inference operate along will with other to sup- evidence port finding of fraud. Gross inadequacy of considera- tion has been declared to constitute a badge of fraud. The inadequacy of may consideration be so as of flagrant itself to afford presumption fraud, as where a contract is such as no man in his senses and not under hand, delusion would make on the one and no honest or other____ fair accept man would on the 2d, Deceit, Am also, Jur Fraud and Section 440. See Little, (1853). Davidson v. Pa. 245 short, that, record, find on we this of a confi- breach dential relationship amounting occurred implied con- fraud; structive said breach was not rebutted evidence by Appellant; consequence submitted and that in implied fraud, existence of or constructive the trial court fully 3360(a) authorized under Section to restrain the sale to Appellant as that court did.
Affirmed.
ZAPPALA, J., dissenting NIX, files a opinion which C.J., joins.
ZAPPALA, Justice, dissenting.
I must take issue the majority’s with underlying premise that a confidential existed between these par- *8 ties. that conclusion is unsupported by Since the credible evidence, then the remainder of the majority’s analysis must also fall. Blank, 137, 412, 493 425 Frowen v. Pa. A.2d 416-417
(1981), this Court defined a confidential as relationship follows: test for general determining the existence of such
a is whether it is clear that the did not relationship parties Estate, deal on equal supra terms. Pa. McClatchy’s [433
107
311,
Estate, 431 Pa.
Carson
(1969)
232,
];
We follows: ship as associ any specific relation is not confined to
Confidential bound to party it is one wherein is parties; ation another, advantage and can take no act benefit for It make it himself. when circumstances appears to terms, but, deal on on parties equal do not certain the influence, or, on overmastering one side there is an other, weakness, trust, re dependence justifiably Leedom advantage in both an is posed; possible. unfair Palmer, 25, 117 411. also v. supra, 274 Pa. at A. at See Estate, 429, (1974)]; Pa. A.2d 883 Scott supra 316 [455 First Trust Co. 399 Pa. Peoples Ratajski, Nat’l Bk. & v. Green, 365 Pa. Kees v. 419, 423, 160 451, (1960); A.2d 552 Hamberg Barsky, v. 368, 374, (1950); A.2d 355 Pa. 75 602 462, (1947). A.2d 345 50 described Brooks relationship again
A confidential Conston, (1947): 69, 76-77, 356 51 v. Pa. A.2d 684 existing relation any
Confidential relation
parties
to a transaction wherein one of the
parties
to act
good
bound
with the utmost
faith
benefit
no
himself
party
the other
advantage
can take
party:
acts
to the interest of the other
relating
from his
Palmer,
Harrison v.
22,
410;
Leedom v.
Pa.
117 A.
274
Estate, 302
Welsh,
Null’s
[1929];
Pa.
A. 507
295
145
defined
recently
The record also that the executrix had re- establishes experience selling ceived some in the of real estate when Prior to property. accepting she sold the Church Street the executrix property, sale of the Church Street twice Likewise, initially as she also rejected inadequate. offers offer for the farm. At the time she did rejected appellant’s offer, in her appellant’s possession she had accept the farm appraisal indicating another was appellant’s as much as offer. worth twice executrix, according testimony Finally, appellant fraud consisted of allegedly perpetrated by counseling obtaining higher price not her into appellant not to do. As appellee required for the This property. noted, not to list obligation appraise property, his it. or sell support
The record does not the trial court’s conclusion that a confidential relationship existed. Here we have an *10 executrix, represented by legal counsel who is a licensed broker, real estate who consults that attorney prior entering agreement into an for the sale of estate property. appellant’s was to duty give opinion his as to the value tax purposes. estate This he did. It was not his responsibility to counsel the executrix so as to maximize the estate return on the sale of proper- the farm such, As he had no ty. duty to assist the executrix in obtaining higher price for the property. Under these facts, the trial court abused its discretion in concluding a confidential relationship existed between the parties. I agree with
Although majority’s interpretation of 20 3360(a) Pa.C.S. application of Estate Hughes, § I find that supra, upon 3360(a) its reliance Section is mis- placed because no confidential relationship executed be- the parties. tween As stated previously, 3360(a) Section requires a finding of fraud an agreement before will be declared upon inadequate unenforceable based considera- tion. Applying 3360(a) Section without the appropriate fac- tual predicate will neutralize effectively that section. instance, this the beneficiaries should sought have relief through a surcharge facts, action. Under these I would hold that the trial granting court erred in the petition to restrain the sale of property.
NIX, C.J., joins in this dissenting opinion.