Attorney general wants trustee removed now in estate of Erie’s Hirt: AG seeks removal of Hirt daughter from estate role [Erie Times-News, Pa.]

Mar. 23--The Pennsylvania Attorney General's Office has toughened its stance in the estate case of Erie resident Audrey Hirt, who left a fortune in Erie Indemnity Co. stock to 40 charities when she died in March 2009.

To force the distribution of the money, the Attorney General's Office wants Erie County Judge Stephanie Domitrovich to immediately remove one of two trustees of Hirt's $60 million trust, Laurel A. Hirt, Audrey Hirt's younger daughter.

The Attorney General's Office in October asked Domitrovich to permanently remove Laurel Hirt, but only after a lengthy process, including a court hearing to start April 14. Domitrovich set an April 9 deadline for the parties to settle through mediation.

Attorney General Tom Corbett on Friday sought to quicken the pace. His office asked Domitrovich to temporarily remove Laurel Hirt as a trustee summarily, with no hearing, to "expeditiously address" the circumstances of the case.

Laurel Hirt, the Attorney General's Office said, has unfairly stalled the trust's distributions to the charities, most of which are in Erie. The office also questioned whether Laurel Hirt would cooperate so the trust could file its federal tax return by a June deadline.

"Ms. Hirt," Senior Deputy Attorney General Gene Herne said in the filing, "lacks the objectivity to effectively perform those duties, to the detriment of the charitable beneficiaries."

Domitrovich has yet to rule. Laurel Hirt has said she is properly safeguarding the trust's assets.

Audrey Hirt, 81, was the daughter-in-law of H.O. Hirt, who cofounded Erie Insurance Group in 1925, and the wife of the late F.W. Hirt, an Erie Insurance chief executive and board chairman. The $60 million trust's main asset is stock in Erie Indemnity Co., the management arm of Erie Insurance.

As the Erie Times-News reported on Sunday, Laurel Hirt, 51, of Millcreek Township, and her only sibling, Elizabeth A. Vorsheck, 54, of Florida, are feuding over the estate, one of the largest in recent Erie County history.

Vorsheck is arguing that her sister, as a trustee, has prevented the trust from selling the stock and raising cash to give the charities and other beneficiaries. The role of the Attorney General's Office is to protect the public's interest in the charitable donations.

Vorsheck, the Attorney General's Office and the second trustee, National City Bank, now part of PNC Bank, in October jointly asked Domitrovich to remove Laurel Hirt. They said PNC then would sell the stock and distribute the assets.

Audrey Hirt bequeathed 28 percent of the trust -- after taxes and other expenses -- to Laurel Hirt, 28 percent to Vorsheck, 30 percent to the 40 charities and the rest to friends and relatives.

The dispute centers on the sale of the trust's primary asset: 1.9 million shares of Erie Indemnity Co. stock, which Audrey Hirt gave her daughters the right of first refusal to buy. Vorsheck nearly a year ago bought half the shares for more than $27 million. That gave the trust liquidity to pay its main expense -- more than $20 million in federal estate taxes.

Laurel Hirt in May said she would buy the other half of the shares but has not closed the deal over a disagreement about the stock price. With no sale, the trust has no liquid assets.

The Attorney General's Office is claiming Laurel Hirt has a conflict of interest, and Domitrovich can remove her immediately as a trustee.

The office said Laurel Hirt, as a trustee, is a seller of the stock and should sell at the highest price to get the most money for the trust's beneficiaries. But the Attorney General's Office said Laurel Hirt, as a buyer of the stock, also would want to buy at the lowest price.

"This conflict of interest," the Attorney General's Office said in the filing, "directly impacts her duty, as a fiduciary, to maximize the value of the trust estate for the beneficiaries, which include 40 charities."

Also on Friday, PNC Bank, the other trustee, asked Domitrovich to let it bypass Laurel Hirt and sell the stock to other Hirt family members or on the open market. PNC said it wants the charities and others to get their money.

"PNC Bank does not claim that Laurel Hirt has engaged in fraud," the bank's lawyers said in a filing, "but rather she is engaged in a course of conduct that places her interests ahead of the interests of the beneficiaries of the trust."

Domitrovich set a hearing on that request for June.

ED PALATTELLA can be reached at 870-1813 or by e-mail.

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