Trust of John S. Middleton, Appeal of: Riley, P.

J-A21034-23

2024 PA Super 53

TRUST OF JOHN S. MIDDLETON : IN THE SUPERIOR COURT OF

: PENNSYLVANIA

:

APPEAL OF: PATRICK J. RILEY :

:

:

:

:

: No. 1843 EDA 2022

Appeal from the Order Entered June 27, 2022

In the Court of Common Pleas of Montgomery County Orphans' Court at

No(s): 2020-X0633

BEFORE: BENDER, P.J.E., LAZARUS, J., and NICHOLS, J.

OPINION BY BENDER, P.J.E.: FILED MARCH 25, 2024

Appellant, Patrick J. Riley (“Riley”), appeals from the order entered on

June 27, 2022, in the Court of Common Pleas of Montgomery County Orphans’

Court, granting an emergency petition to compel the trustee to make

distributions to the sole current beneficiary of the Trust of John S. Middleton.

After careful review, we vacate and remand for further proceedings.

John S. Middleton (“Settlor” or “Grantor”) established an inter vivos,

irrevocable trust under an agreement dated March 3, 2002 (“Trust

Agreement”), and named Larry P. Laubach, Esquire (“Laubach”), as the initial

trustee. Under the Trust Agreement, Settlor retained an annuity interest for

two years. At the conclusion of the two-year period, the trust was divided

into two equal trusts — one for the benefit of Settlor’s son, John P. Middleton

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(“John”), and the other for the benefit of Settlor’s daughter, Frances B.

Middleton.1

On February 5, 2020, in accordance with the terms of the Trust

Agreement, Laubach was removed from his position as trustee. On February

6, 2020, Settlor appointed Riley as the successor trustee. Later that same

day, Riley, acting in his role as trustee, executed a document in which he

purportedly appointed Bridgeford Trust Company, LLC (“Bridgeford”), of

Pierre, South Dakota, as a co-trustee and concurrently changed the situs of

the Trust — jointly with Bridgeford — from Montgomery County, Pennsylvania

to South Dakota. See Appointment of Co-Trustee, Change of Administrative

Situs, and Delegation to Co-Fiduciary as Agent, 2/6/20, at 1-5.

On February 14, 2020, John filed a petition seeking a declaratory

judgment that the attempted trustee appointment and change of situs are

void and invalid ab initio (“Declaratory Petition”), in which he relied heavily on

the following relevant provisions of the Trust Agreement:

TWELFTH -- Administrative Powers: Except as may be

prohibited hereinabove or by the [Internal Revenue Code of 1986,

as amended (“I.R.C.”)] and the Treasury Regulations pertaining

to qualified annuity interests, Trustee or Trustees shall have the

following powers in addition to those otherwise provided herein or

by law, to be exercised in Trustee’s or Trustees’ absolute

discretion:

…

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1 This matter pertains only to the trust created for the benefit of John, which

is referred to herein as “the Trust.”

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15. To change the situs for administrative and accounting

purposes of any trust created hereunder to any jurisdiction,

without the necessity of court approval.

…

FOURTEENTH -- Situs of Trust: The situs of this trust shall

be the Commonwealth of Pennsylvania, and all questions

pertaining to the construction and validity of the provisions of this

Agreement shall be governed by the law of that Commonwealth.

…

SIXTEENTH -- Trustees: In the event Larry P. Laubach (or

any successor to him) becomes unable to serve or continue to

serve, Grantor shall appoint a successor Trustee who is a “non-

family member” as defined below. …

In addition, at such time as a child or grandchild of Grantor

for whom a trust has been established herein reaches thirty

(30) years of age, such child or grandchild shall become a

Co-Trustee of his or her respective trust. Subject to the

foregoing, upon a child or grandchild of Grantor reaching thirty

(30) years of age, the Trustees then serving for the trust of such

child or grandchild shall be limited to a four (4) year term with the

first such four (4) year term beginning upon the child or

grandchild’s reaching thirty (30) years of age. Such four (4) year

term shall be renewable in the absolute discretion of the child or

grandchild for whom a trust is established.

Furthermore, Trustees serving hereunder from time to time

are authorized to appoint at any time, by unanimous action

if more than one Trustee is then serving, additional

Trustees. Each such designation or appointment shall be made

by written instrument other than a will, and may be revoked in

writing at any time prior to its becoming effective.

A “non-family member Trustee” shall refer to a corporation or an

individual who is neither a descendant of Grantor nor married to

such a person, nor any person who is a “related or subordinate

party” to Trustee as defined in I.R.C. Section 672(c). …

Trustees designated or appointed pursuant to this Item

SIXTEENTH shall qualify as such by attaching hereto a

written acceptance of the office and thereupon shall

undertake all of the obligations and powers assigned to

“Trustees” hereunder.

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Trust Agreement, 3/3/03, at 20-21, 23, 26-29 (emphases added).

John averred that, in accordance with Item Sixteenth of the Trust

Agreement, he became a co-trustee in 2014, when he turned 30 years of age,

and that he properly accepted his appointment in writing. Declaratory

Petition, 2/14/20, at ¶¶ 5(d), 5(f), 7. As such, John argued that Riley’s

unilateral appointment of Bridgeford as a co-trustee, as well as the purported

change in situs of the Trust to South Dakota were void and invalid ab initio.

Id. at ¶¶ 36, 44. See also id. at ¶ 34 (noting that “pursuant to Item

SIXTEENTH of the Trust Agreement, in order to appoint additional co-trustees,

if more than one trustee is serving, the appointment of additional trustees

must be ‘by unanimous action’”); id. at ¶ 35 (John’s indicating that he did not

consent to or join in the appointment of Bridgeford as co-trustee); id. at ¶ 37

(stating that Item TWELFTH ¶ 15 of the Trust Agreement grants the trustees

the power to change the situs of the Trust for administrative and accounting

purposes); id. at ¶ 38 (“Pursuant to 20 Pa.C.S. § 7763(a), ‘[c]o[-]trustees

who do not reach a unanimous decision may act by majority decision.’”); id.

at ¶ 42 (“John, as a co-trustee … was not consulted with and did not consent

to or join in the change of situs of the Trust from Pennsylvania to South

Dakota.”); id. at ¶ 43 (asserting that Riley did not have the power to

unilaterally change the situs of the Trust).

Riley filed an answer and new matter to John’s Declaratory Petition,

contesting John’s assertion that he became a co-trustee in 2014. While Riley

consented that John reached the age of 30 in 2014, he averred that at the

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time of Bridgeford’s appointment and the change in situs to South Dakota,

John had not accepted the position of trustee in accordance with the terms of

the Trust Agreement. Answer and New Matter, 10/2/20, at ¶¶ 6-7.2 In fact,

he stated that the only alleged “evidence” provided by John of his supposed

acceptance of the position — namely, a January 11, 2018 redacted letter

addressed to Laubach — merely reflected John’s “‘intent’ at some unspecified

time in the future to so accept such position, but not his then present

acceptance of the duties and responsibilities of a co-trustee.” Id. at ¶ 7.

Hence, Riley argued that he was not obligated to seek John’s joinder or

consent to either appoint Bridgeford as a co-trustee or to change the situs of

the Trust. Id. at ¶ 10. Additionally, Riley asserted that because the situs was

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2 As Riley noted, 20 Pa.C.S. § 7761 provides, in relevant part, that a person

designated as trustee accepts the trusteeship:

(1) By substantially complying with a method of acceptance

provided in the Trust instrument; or

(2) If the Trust instrument does not provide a method or the

method provided in the Trust instrument is expressly made

exclusive, by accepting delivery of the Trust property,

exercising powers or performing duties as a Trustee or by

otherwise indicating acceptance of the Trusteeship….

Answer and New Matter at ¶ 59. See also id. at ¶ 61 (Riley’s stating that

trustees designated under Item Sixteenth of the Trust Agreement “shall

qualify as such by attaching hereto a written acceptance of the office and

thereupon shall undertake all of the obligations and powers assigned to

‘Trustees’ hereunder” (quoting Trust Agreement at 29)); id. at ¶ 60 (Riley’s

advancing that “at no time prior to February 6, 2020[,] did John comply with

either the method of acceptance of the [t]rusteeship provided in the Trust

[Agreement] or otherwise exercising [sic] any powers or perform any duties

as Trustee that would indicate acceptance of the [t]rusteeship…”).

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properly moved to South Dakota, the Court of Common Pleas of Montgomery

County, Pennsylvania, Orphans’ Court Division lacks jurisdiction over the

administration of the Trust. Id. at ¶¶ 25-26.3

Riley subsequently proceeded with filing a request for limited discovery

against John and Laubach regarding John’s purported acceptance of the office

of co-trustee prior to February 2020. A status conference was held on

February 1, 2021; however, no hearing date was scheduled on John’s

Declaratory Petition, nor did the court rule on Riley’s discovery request at that

time.

On May 19, 2022, while the Declaratory Petition was still pending and

the question regarding the orphans’ court’s jurisdiction over the

administration of the Trust remained unresolved, John filed an emergency

petition seeking to compel Riley to make distributions from the Trust “to

preserve seat licenses John owns for seats to the Los Angeles Lakers (the

‘Lakers’), a professional basketball team in the National Basketball Association

(the ‘NBA’).” John’s Brief at 5.4 Riley filed preliminary objections to the

Emergency Petition, arguing that the orphans’ court could not rule on the

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3 We note that Settlor also filed an answer and new matter to John’s

Declaratory Petition, to which John filed preliminary objections. By order of

court dated August 25, 2022, the orphans’ court sustained John’s preliminary

objections on the grounds that “Settlor lacks standing to respond to the

Petition.” Order, 8/22/22, at 1. Settlor’s answer and new matter was thereby

stricken. Id. Settlor filed a timely appeal from that order at docket no. 2449

EDA 2022, which we address in a separate writing.

4 John’s petition seeking distributions from the Trust is referred to herein as

the “Emergency Petition.”

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request for distributions without first deciding if it has jurisdiction. Riley’s

Brief at 10. See also Preliminary Objections, 5/24/22, at ¶¶ 1-7 (reminding

the orphans’ court that John’s Declaratory Petition raises the question of which

court has jurisdiction over administration of the Trust, which must be resolved

before the court can undertake such oversight of the Trust and rule on John’s

request for “emergency” distributions).

While the Emergency Petition was still pending, John was notified by the

Lakers’ business office that his Lakers season seat licenses were “subject to

immediate cancellation,” unless two equal payments of $176,095.06 were

received by the Lakers — the first by June 27, 2022, and the second by August

15, 2022. John’s Brief at 9-10. Thus, on June 24, 2022, John filed a praecipe

with the orphans’ court to amend his proposed preliminary decree to the

Emergency Petition in accordance with the cancellation notice received from

the Lakers. Id. at 10. Without addressing Riley’s preliminary objections or

holding an evidentiary hearing on either the Emergency Petition or the

underlying Declaratory Petition, the orphans’ court entered an order on June

27, 2022, directing Riley to make the two payments necessary to avoid

cancellation of John’s seat licenses. Id. See Order (“Distribution Order”),

6/27/22, at 1-2.

Riley filed a timely notice of appeal, followed by a timely, court-ordered

Pa.R.A.P. 1925(b) concise statement of errors complained of on appeal. The

orphans’ court filed its Rule 1925(a) opinion on August 31, 2022, in which it

opined that its June 27, 2022 order is not immediately appealable. See

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Orphans’ Court Opinion (“OCO”), 8/31/22, at 1 (“This order is neither a final

order under Pa.R.A.P. 341, nor a collateral order under Pa.R.A.P. 313.”); id.

at 2 (opining that the order appealed from is not an appealable orphans’ court

order under Pa.R.A.P. 342). Additionally, on October 7, 2022, John filed a

motion to dismiss this appeal as moot pursuant to Pa.R.A.P. 1972(a)(4),

noting that Riley had already made the distributions in accordance with the

Distribution Order.5

Herein, Riley presents the following issues for our review:

1. Whether the orphans’ court erred in rendering an adjudication

of [John’s] Emergency Petition … by exercising jurisdiction over

the Trust and directing distributions from the Trust without first

ruling on a prior pending petition concerning whether

Pennsylvania has jurisdiction over the administration of the

Trust.

2. Whether the orphans’ court erred in rendering an adjudication

of the Emergency Petition and directing distributions from the

Trust without holding an evidentiary hearing as to the

jurisdictional issue of whether … John … was a co-trustee of the

Trust prior to February 6, 2020[,] whose consent was

necessary to appoint another trustee and change the situs of

the trust.

3. Whether the orphans’ court erred in rendering an adjudication

of the Emergency Petition and mandating distributions from the

Trust without holding an evidentiary hearing to resolve

numerous disputed issues of fact raised by the Emergency

Petition.

4. Whether the orphans’ court erred in rendering an adjudication

of the Emergency Petition when there was a pending Petition

for Leave to Conduct Oral and Written Discovery, seeking

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5 By per curiam order dated October 7, 2022, the disposition of John’s

application to dismiss the appeal was deferred to the merits panel and is

discussed further infra.

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documents and other discovery directly relevant to the issue of

whether the court had jurisdiction.

5. Whether the orphans’ court erred in rendering an adjudication

of the Emergency Petition directing distributions from the Trust

in order “to preserve the status quo” without holding a hearing

to allow the presentation of evidence to establish what the

status quo was.

Riley’s Brief at 6-7 (cleaned up).

Before we reach the merits of the issues raised by the appellant, we

must first determine whether this appeal is properly before us. “The question

of the appealability of an order goes directly to the jurisdiction of the Court

asked to review the order.” Beltran v. Piersody, 748 A.2d 715, 717 (Pa.

Super. 2000). “Jurisdiction is purely a question of law; the appellate standard

of review is de novo, and the scope of review is plenary.” Commonwealth

v. Merced, 265 A.3d 786, 789 (Pa. Super. 2021).

Our “jurisdiction is generally limited to appeals from final orders of

courts of common pleas, unless a statute provides otherwise.” Williams v.

Williams, 385 A.2d 422, 422 (Pa. Super. 1978). As the record reveals that

the issues regarding the validity of Bridgeport’s appointment as a co-trustee

as well as the change in situs of the Trust are still pending below, we agree

with the orphans’ court that its June 27, 2022 order directing Riley to make

distributions from the Trust is not a final order, because it does not dispose of

all claims and all parties. See Pa.R.A.P. 341(b). Nonetheless, we disagree

with the orphans’ court’s position that the order is not appealable under

Pa.R.A.P. 342. Pursuant to Rule 342, “[a]n appeal may be taken as of right

from … [a]n order confirming an account, or authorizing or directing a

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distribution from an estate or trust[.]” Pa.R.A.P. 342(a)(1). See also id. at

Comment (“Orders falling within subdivisions (a)(1)-(7) no longer require the

lower court to make a determination of finality.”). Moreover, the failure to

appeal an order that is immediately appealable under Rule 342(a) “shall

constitute waiver of all objections to such order and such objections may not

be raised in any subsequent appeal.” Pa.R.A.P. 342(c).

Here, the order from which Riley appealed expressly states, in relevant

part:

1. Pursuant to 20 Pa.C.S. § 7711, to preserve the status quo

and to prevent the forfeiture of seat licenses worth in excess

of $3,000,000, Patrick J. Riley is hereby ordered to make

the following distributions to John P. Middleton from the

above-captioned [T]rust[:]

(a) $176,095.06 by 5:30 p.m. PDT on June 27, 2022; and

(b) $176,095.06 by 5:30 p.m. PDT on August 15, 2022.

2. Nothing in this order shall limit Patrick J. Riley’s ability or

duty to exercise his discretion to make additional

distributions to John P. Middleton for his education, medical

care or support in reasonable comfort in addition to the

amount set forth in this order.

Distribution Order at ¶¶ 1-2. There is no question that this is an order

“directing a distribution from [a] … trust[.]” Pa.R.A.P. 342(a)(1).

Consequently, the Distribution Order was immediately appealable as of right

pursuant to Rule 342(a)(1).6

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6 We further observe that the Distribution Order constitutes a mandatory

preliminary injunction. See 15 Standard Pennsylvania Practice 2d § 83:9

(“Mandatory preliminary injunctions command positive acts on part of one

(Footnote Continued Next Page)

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We now turn to John’s motion to dismiss this appeal on the grounds of

mootness. John avers that Riley has fully complied with the Distribution Order

by making both of the payments as directed by the orphans’ court, and that

those distributions “cannot be undone.” Motion to Dismiss, 10/7/22, at ¶¶ 4,

5, 18, 26. He further asserts that “[w]hen a party complies with a decree

from which it has appealed, the party’s appeal from that decree is moot.” Id.

at ¶ 19 (citing Easton Theatres, Inc. v. Wells Fargo Land and Mort. Co.,

Inc., 449 A.2d 1372 (Pa. 1982)). See also id. at ¶ 23 (“When, as here, ‘the

terms of the order … on appeal have been fully executed and there remains

no power to grant the relief sought,’ the appeal should be dismissed as moot.”

(quoting Graziano Constr. Co., Inc. v. Lee, 444 A.2d 1190, 1194 (Pa.

Super. 1982)). As it is well established that this Court “cannot enter

judgments or decrees to which effect cannot be given,” id. at ¶ 25 (quoting

Graziano, 444 A.2d at 1193), John requests that we dismiss the instant

appeal as moot. Id. at 8.

In response, Riley advances that the issue on appeal is not the

distributions made in accordance with the Distribution Order but, rather,

“Riley’s right to an evidentiary hearing on jurisdiction and his right to an

evidentiary hearing [as to the status quo] before a mandatory injunction is

entered.” Response to Motion to Dismiss, 10/12/22, at 1-2. He argues that

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party to maintain the status quo between the parties.”). Thus, we would also

deem the Distribution Order an interlocutory appeal as of right. See Pa.R.A.P.

311(a)(4) (permitting an interlocutory appeal as of right from an order

granting injunctive relief).

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“[t]he order appealed from must be vacated, not to claw back the payments

made to the Lakers, but so as to undo the premature exercise of jurisdiction

by the orphans’ court.” Id. at 2 (unnecessary capitalization omitted).7 See

also id. at 10 ¶ 17 (stating that the orphans’ court’s granting of John’s

Emergency Petition “was an exercise of jurisdiction over the Trust without first

adjudicating the issue of jurisdiction which had been pending before the

[c]ourt since February 14, 2020”). Moreover, Riley asserts that the orphans’

court “granted the Emergency Petition expressly to preserve the status quo

while totally unaware of the actual status quo … because it never held a

hearing on [John’s] Emergency Petition….” Id.

This Court has explained the doctrine of mootness as follows:

As a general rule, an actual case or controversy must exist at all

stages of the judicial process, or a case will be dismissed as moot.

An issue can become moot during the pendency of an appeal due

to an intervening change in the facts of the case or due to an

intervening change in the applicable law. In that case, an opinion

of this Court is rendered advisory in nature. An issue before a

court is moot if in ruling upon the issue the court cannot enter an

order that has any legal force or effect.

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7 While Riley admits that he made both the required distributions, he avers

that he made these payments — not pursuant to the Distribution Order —

but, rather, pursuant to an agreement that he reached with John prior to the

issuance of the court’s order and to fulfill his fiduciary duties to the Trust.

Response to Motion to Dismiss at ¶¶ 3-4. In fact, Riley indicates that the first

payment “had already been made before the [Distribution] Order was issued.”

Id. at ¶ 3. “The making of the first payment gave rise to a fiduciary duty to

make the second[,] because without the second payment, the first payment

would have been an unnecessary waste of Trust resources because the seat

license[s] would have been lost.” Id. at ¶ 4.

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In re D.A., 801 A.2d 614, 616 (Pa. Super. 2002) (en banc) (citations and

quotation marks omitted). “It is impermissible for courts to render purely

advisory opinions. In other words, judgments or decrees to which no effect

can be given will not, in most cases, be entered by this Court.” First Union

Nat. Bank v. F.A. Realty Investors Corp., 812 A.2d 719, 724 (Pa. Super.

2002) (citation omitted).

Nevertheless, this Court will decide questions that otherwise have

been rendered moot when one or more of the following exceptions

to the mootness doctrine apply: 1) the case involves a question of

great public importance, 2) the question presented is capable of

repetition and apt to elude appellate review, or 3) a party to the

controversy will suffer some detriment due to the decision of the

trial court.

In re D.A., 801 A.2d at 616 (citations omitted).

Instantly, John argues that this appeal is moot because “Riley has fully

complied with the [Distribution] Order.” Motion to Dismiss at ¶ 5. See also

id. at ¶ 26 (“Here, Riley made the distributions from the Trust as directed by

the [c]ourt, and those distributions cannot be undone.”). He reasons that, “in

determining whether an appeal is moot, this Court looks to whether the relief

sought by the appellant can be granted[,]” and that we cannot enter a

judgment or decree to which no effect can be given. Id. at ¶ 25 (citing

Graziano, 444 A.2d at 1193).

It is true that where “there remains no power to grant the relief sought,”

an appeal should be dismissed as moot. Graziano, 444 A.2d at 1194.

However, that is not the case here. As Riley points out, he is not asking that

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the payments be “undone.” See Response to Motion to Dismiss at 2, 12. To

the contrary, he seeks the following relief on appeal:

Based upon all of the foregoing, this Court should 1) vacate the

[o]rphans’ court[’s] order dated June 27, 2022[,] so as to avoid

any waivers of Riley’s objections to a) the exercise of jurisdiction

over this Trust in Pennsylvania and b) the entry of injunctive relief

without a hearing; and 2) remand the matter to the [o]rphans’

court with instructions a) to hold an evidentiary hearing on the

[Declaratory] Petition, following discovery, and b) not to issue any

further injunctive relief without: i) expediting [John’s] production

of the documents on which he bases his claims in the

[Declaratory] Petition and which he claims demonstrate that

jurisdiction lies here in Pennsylvania because he was allegedly a

[t]rustee at the time of the change of situs; and ii) holding a

hearing to determine the status quo, the potential of irreparable

harm[,] and the need for emergency relief before a full evidentiary

hearing can be held on the [Declaratory] Petition.

Riley’s Brief at 45-46. Hence, Riley is essentially seeking our review of the

orphans’ court’s exercise of jurisdiction over the Trust without first conducting

an evidentiary hearing to determine whether it had jurisdiction over the

administration of the Trust. Because the issue of the orphans’ court’s

jurisdiction remains unresolved and such a determination is essential for the

resolution of the parties’ rights and the underlying matters, we cannot agree

that this appeal is moot. See F.A. Realty Investors Corp., 812 A.2d at 725

(concluding that despite the entry of a consent order and the appellant’s

payment in full of the judgment amount owed to the appellees, the appeal

was not moot where the question of whether the trial court had jurisdiction to

enter the consent order remained unresolved and could still impact the

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respective legal rights and obligations of the parties).8 Thus, we will address

Riley’s claims.9

We review the merits of Riley’s claims mindful of the following: In an

appeal from an orphans’ court’s decision,

[we] must determine whether the record is free from legal error

and the court’s factual findings are supported by the evidence.

Because the [o]rphans’ [c]ourt sits as the fact-finder, it

determines the credibility of the witnesses and, on review, we will

not reverse its credibility determinations absent an abuse of that

discretion. However, we are not constrained to give the same

deference to any resulting legal conclusions. Where the rules of

law on which the court relied are palpably wrong or clearly

inapplicable, we will reverse the court’s decree.

In re Vincent J. Fumo Irrevocable Children’s Trust ex rel. Fumo, 104

A.3d 535, 539 (Pa. Super. 2014) (citation omitted). Moreover, to the extent

that the appellant’s claims involve statutory interpretation and/or

interpretation of the Trust document, such issues present questions of law

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8 John’s Motion to Dismiss this appeal as moot is hereby DENIED.

9 On January 11, 2024, Riley filed an application under Pa.R.A.P. 2501(a),

requesting that we take judicial notice of a subsequent appeal filed by John at

docket number 3220 EDA 2023. In his application, Riley indicates that John

has purportedly filed numerous emergency requests for distributions from the

Trust since his filing of the Emergency Petition at issue in the matter sub

judice. Application for Judicial Notice, 1/11/24, at ¶¶ 4-5. John’s appeal at

3220 EDA 2023 is allegedly from the orphans’ court’s denial of one of these

additional emergency distribution requests. Id. at ¶ 8. Riley suggests that

this subsequent appeal warrants judicial notice, “as it demonstrates that the

issue on appeal here is ‘likely to repeat itself,’ thereby assuring that the within

appeal is not moot.” Id. at ¶ 9. See also id. at ¶ 3 (noting that a question

which is likely to repeat itself is an exception to the mootness doctrine). Due

to our disposition in this case, it is unnecessary to take judicial notice of this

appeal. Hence, Riley’s Application for Judicial Notice is hereby DENIED.

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over which our standard of review is de novo and our scope of review is

plenary. See In re Jackson, 174 A.3d 14, 29 (Pa. Super. 2017); B.K.M. v.

J.A.M., 50 A.3d 168, 172 (Pa. Super. 2012).

We begin by considering whether the Montgomery County Orphans’

Court had jurisdiction over the Trust at the time it adjudicated John’s

Emergency Petition, as each of the questions before us is dependent on a

determination of this issue. In accordance with the Trust Agreement, “the

situs of this [T]rust shall be the Commonwealth of Pennsylvania, and all

questions pertaining to the construction and validity of the provisions of this

Agreement shall be governed by the law of that Commonwealth.” Trust

Agreement at 26. However, the trustee(s) shall have the power to “change

the situs [of the Trust] for administrative and accounting purposes … to any

jurisdiction, without the necessity of court approval.” Id. at 23 ¶ 15. Thus,

while the terms of the Trust are to be interpreted by Pennsylvania law, the

situs where the Trust is administered can be changed by the trustee(s).

Essentially, Riley argues that the situs of the Trust was transferred from

Pennsylvania to South Dakota on February 6, 2020; hence, the Trust shall

now be administered in accordance with South Dakota law. According to John,

however, he became a co-trustee in 2014. As such, John maintains that the

purported transfer of the Trust situs to South Dakota was void and invalid ab

initio and, therefore, the Trust is still governed by the law of this

Commonwealth. To resolve this conflict of laws issue, we turn to

Pennsylvania’s choice-of-law rules. See Melmark, Inc. v. Schutt By and

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Through Schutt, 206 A.3d 1096, 1104 (Pa. 2019) (“Courts conduct a choice-

of-law analysis under the choice-of-law rules of the forum state.”).

Pennsylvania has adopted the Restatement (Second) of Conflicts of

Laws, which provides in relevant part:

The administration of an inter vivos trust of interests in movables

is governed as to matters which can be controlled by the terms of

the trust

(a) by the local law of the state designated by the settlor

to govern the administration of the trust, or

(b) if there is no such designation, by the local law of the

state to which the administration of the trust is most

substantially related.

Restatement (Second) of Conflict of Laws § 272 (1971). “Matters of

administration” are defined as “those which relate to the management of the

trust[,]” which include “matters relating to the duties owed by the trustee to

the beneficiaries[;] … the powers of a trustee, such as … the exercise of

discretionary powers, the requirement of unanimity of the trustees in the

exercise of powers, and the survival of powers[;] … the removal of the trustee

and the appointment of successor trustee….” Id. at § 272, Comment a; id.

at § 271, Comment a.

The Comments to Section 272 explain that “[t]he settlor of an inter vivos

trust may designate in the trust instrument a state whose local law is to govern

the administration of the trust.” Id. at § 272, Comment c. However, “[w]hen

the settlor does not designate a state whose local law is to govern the

administration of the trust, its administration will be governed by the local law

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of the state to which the administration is most substantially related.” Id. at

§ 272, Comment d. Moreover, Comment e to Section 272 states:

If the actual place of administration is changed … because … in

the exercise of a power of appointment a trustee is appointed

whose place of business or domicil is in another state, the question

arises whether thereafter the administration of the trust is

governed by the local law of the other state. This depends on the

terms of the trust, express or implied. Such a change of the

applicable law may be expressly authorized by the terms of the

trust, or it may be authorized by implication, such as when the

trust instrument contains a power to appoint a trustee in another

named state. A simple power to appoint a successor trustee may

be construed to include a power to appoint a trust company or

individual in another state. In such cases, the law governing the

administration of the trust thereafter is the local law of the other

state and not the local law of the state of original administration.

On the other hand, the terms of the trust may show the [settlor’s]

intention that the trust is always to be administered under the

local law to the original state. In such a case[,] the mere fact that

… by the exercise of a power of appointment a … trustee is

appointed who is domiciled in another state does not result in a

change of the law applicable to the administration of the trust.

Id. at § 272, Comment e.

Here, the terms of the Trust allow for the transfer of the Trust situs “to

any jurisdiction[,]” Trust Agreement at 23 ¶ 15, and contain no language

indicating that the Settlor intended for the Trust to always be administered

under Pennsylvania law. Rather, the Trust Agreement merely states that “all

questions pertaining to the construction and validity of the provisions

of this Agreement shall be governed by the law of [the] Commonwealth[ of

Pennsylvania].” Id. at 26 (emphasis added). The Trust Agreement is silent

as to which state’s law shall govern the administration of the Trust. Thus,

if the situs of the Trust was in fact transferred to South Dakota, we would

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likely determine that the laws of South Dakota would apply. See SDCL § 55-

3-48 (“Unless the governing instrument or a court order expressly prohibits

the change of the law of another jurisdiction to govern the administration of

the trust, the laws of South Dakota shall govern the administration of a trust

while the trust is administered in South Dakota.”). Alternatively, if the

transfer of situs was not valid and the situs remains in Pennsylvania, the laws

of the Commonwealth would apply. See 20 Pa.C.S. § 722 (“When a

Pennsylvania court has jurisdiction of any trust, … except as otherwise

provided by law, the venue for all purposes shall be in the county where at

the time being is the situs of the trust.”); 20 Pa.C.S. § 711 (granting the

orphans’ court exclusive and mandatory jurisdiction over matters regarding

the administration of inter vivos trusts, the distribution of personal property

of inter vivos trusts, and the appointment and removal of a trust fiduciary).

Based on our review, whether the transfer of situs to South Dakota was

valid is dependent on resolution of the question regarding whether John

properly accepted the role as a co-trustee in accordance with the Trust

Agreement. This is a matter of factual dispute between the parties, which

must be resolved in the orphans’ court. Accordingly, we vacate the June 27,

2022 order and remand for the orphans’ court to conduct an evidentiary

hearing and to determine whether it has jurisdiction over this matter.10

____________________________________________

10 Due to our disposition, we need not address Riley’s claim that the orphans’

court erred in directing distributions from the Trust without first holding an

(Footnote Continued Next Page)

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Order vacated. Case remanded for proceedings consistent with this

memorandum. Jurisdiction relinquished.

Date: 3/25/2024

____________________________________________

evidentiary hearing to determine the status quo. However, in the event that

the orphans’ court is deemed to have jurisdiction over the Trust, we note that

“[a] court shall issue a preliminary … injunction only after written notice and

hearing unless it appears to the satisfaction of the court that immediate and

irreparable injury will be sustained before notice can be given or a hearing

held, in which case the court may issue a preliminary … injunction without a

hearing or without notice.” Pa.R.Civ.P. 1531(a). See also Pa.O.C.R. 7.4

(“Upon petition, the court may issue a preliminary, special, or permanent

injunction in accordance with the rules and procedures provided in Pa.R.Civ.P.

1531.”).

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