Dolores Pierce died in December 2014. She appointed her son Michael as executor of her estate, and letters testamentary issued on May 20, 2015.

The decedent’s estate included 3 parcels of real property: a farm, a house (the “Pine Tree” property), and a third property where Michael lived and worked (the “Ramshorn” property). The decedent’s will directed that the real property “be sold as soon as practicable.”

On November 16, 2015, Michael’s sister Marilyn filed a complaint seeking Michael’s removal as executor, alleging that he failed to pay estate tax, failed to sell the real property, failed to inventory or distribute the personal property, and refused her access to the property. In response, Michael filed a 13-page certification outlining his efforts to administer the estate. He explained that the estate taxes were not paid because there were no cash assets; he had obtained some appraisals but was not yet required to provide them to Marilyn; and he had attempted to manage the properties. He noted that an underground tank was discovered on the Pine Tree property, but he had located a buyer for the property. He expressed his desire to purchase the Ramshorn property, stated that it had been in foreclosure at the time of the decedent’s death, and that he had personally paid the estate over $20,000 so that real estate taxes could be paid. As to the farm, he attached a letter from a realtor declining to list the property, citing wetlands on the property. On January 29, 2016, his attorney represented that a contract was signed on the Pine Tree property the previous week, and that he would obtain an appraisal for the Ramshorn property in the next few weeks.

The chancery judge stated that Michael had delayed in obtaining appraisals and selling the properties. She denied Marilyn’s application to remove Michael as executor, noting that it is difficult to demonstrate “clear and definite proof of fraud, gross carelessness, or indifference.” Although she found that Michael had acted in good faith, she also commented that he was “hanging on by a thread.” She ordered that, if the Pine Tree sale did not close by March 1, 2016, Michael would be required to sign a multiple listing agreement and take other actions within 10 days. She also ordered him to list the farm property within 10 days “at a price which may be higher than but shall not be less than the appraised value.”

On February 26, 2016, Michael’s attorney asked Marilyn’s attorney for a 1-week extension of the March 1, 2016 Pine Tree closing date, because the storage tank had to be removed. Marilyn’s attorney refused.

The Pine Tree property sale closed on March 2, 2016; that same day, Marilyn filed a motion for reconsideration, arguing that Michael should be removed because of the delay in the Pine Tree sale.

Michael opposed the motion for reconsideration, noting that the closing had occurred on March 2. According to Michael, he had made efforts to comply with the court’s order in other respects. Marilyn never contacted him to arrange a time to inspect the real property; he had given her an itemized list of personal property, and he had moved that personal property to a storage facility. He also advised the court that the farm had been listed for $2.8 million, much higher than the $830,000 appraised value, because the realtor suggested he do so. Marilyn countered that the jewelry appraisal was lower than a previous one he had given her, and that items were missing. She also argued that the $2.8 million listing price was “effectively a decision not to sell” the farm.

At the hearing on Marilyn’s reconsideration motion, the court did not permit Michael to testify regarding the farm listing price. The judge found that Michael had failed to comply with her prior order, and that the farm listing price showed that he did not really want to sell the property. She found that the Pine Tree property closing was delayed, although not by much. She also found that his moving the personal property to a storage facility showed he was not “cooperating.” The judge ordered Michael’s removal as executor.

On appeal, the Appellate Division found that Michael’s conduct “did not fall outside of the obligations imposed by the statute (N.J.S.A. 3B:14-21)” allowing fiduciaries to be removed for cause. It found that almost all of the evidence presented in Marilyn’s reconsideration motion pertained to the Pine Tree sale, which had been sold by the time the chancery court removed Michael as executor. It found that none of Michael’s actions were in actual violation of the court’s prior order, which had not mandated a sale by March 1; and that, even if a March 1 closing date had been ordered, a one-day delay was “inconsequential.” With regard to Michael’s decision to list the farm property well above the appraised price, that decision was not a violation of the judge’s order. It also found that there were disputes of fact that required resolution before Michael could be removed. The Appellate Division remarked,

Courts should be reluctant to remove an executor … without clear and definite proof of fraud, gross carelessness or indifference…. Based on our review of the record, [Michael] did not engage in misconduct that approximated the extremes in the statute.

A copy of In the Matter of the Estate of Pierce can be found here – In the Matter of the Estate of Pierce

For additional information concerning probate litigation and will contests, visit: https://vanarellilaw.com/will-contests-probate-litigation-elder-abuse-actions/#iplwc

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