COURT OF CHANCERY
OF THE
STATE OF DELAWARE
PATRICIA W. GRIFFIN CHANCERY COURTHOUSE
MASTER IN CHANCERY 34 The Circle
GEORGETOWN, DELAWARE 19947
Final Report: February 22, 2018
Draft Report:
Date Submitted: November 30, 2017
Dorey L. Cole, Esquire
Moore & Rutt, P.A.
122 West Market Street
PO Box 554
Georgetown, DE 19947
Dean A. Campbell, Esquire
Law Office of Dean A. Campbell, LLC
20175 Office Circle
PO Box 568
Georgetown, DE 19947
RE: Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and
Charles Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
Dear Counsel:
Daniel F. Morton, Sr. (hereinafter “Daniel”) filed a petition against
Respondents Ernest Rogers, Jr. (hereinafter “Ernest”), Tammie Rogers (hereinafter
“Tammie”), and Charles Douglas Morton, Jr. (hereinafter “Charles), on August 22,
2017 seeking a declaratory judgment confirming the validity of a contract for the
sale of real property, specific performance of the sales contract, alternative relief
and damages, costs and attorney’s fees based upon intentional misrepresentation,
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 2 of 20
equitable fraud, common law fraud and civil conspiracy.1 Pending before me is
Respondents’ October 12, 2017 motion to dismiss the petition under Court of
Chancery Rule 12(b)(6). Respondents argue that Daniel has failed to state a claim
for specific performance because the contract lacks definite essential terms and is
unenforceable, and once specific performance is denied, the other claims should be
dismissed for lack of subject matter jurisdiction because those claims seek
remedies at law. The motion is fully briefed.
I recommend that the Court deny Respondents’ motion to dismiss. This is a
final report.
BACKGROUND
Daniel entered into an alleged contract to purchase approximately two acres
of land from Ernest and Tammie (hereinafter “two-acre property”), which was part
of the 118 acres they owned on the west side of Blacksmith Shop Road in
Greenwood, Delaware, in June 2014. The contract is memorialized in two receipts
dated June 17, 2014 and October 8, 2014 and signed by Daniel and Ernest. The
June 2014 receipt stated:
I DANIEL F. MORTON ON THIS DAY OF JUNE 17, 2014 GIVE
TO ERNIE ROGERS [$]1,000.00 TOWARD THE PURCHASE OF
LAND, SOUTH AND ADJACENT TO CHARLES, CHUCK,
1
I may use first names in pursuit of clarity and intend no familiarity or disrespect.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 3 of 20
MORTON. THIS LAND CONSIST[S] OF PLUS OR MINUS (2)
ACRES, MEASURING 284 ft. BACK FROM ROAD
(BLACKSMITH SHOP ROAD) AND APPROXIMATELY 300’
PLUS ON FRONT DEPENDING WIDTH OF RIGHT OF WAY
[letters scratched out] OR SERVICE LANE REQUESTED BY MR.
ROGERS.
The October 2014 receipt provided:
I DANIEL F. MORTON GIVE TO ERNIE ROGERS THE 2nd
$1,000.00 PAYMENT TOWARD THE PURCHASE OF LAND,
SOUTH AND ADJACENT TO CHARLES MORTON. THIS LAND
CONSIST[S] OF PLUS OR MINUS (2) ACRES, MEASURING 284
FEET BACK FROM BLACKSMITH SHOP ROAD AND
APPROXIMATELY 300’ PLUS ON FRONT DEPENDING ON
WIDTH OF MR. ROGER’S RIGHT OF WAY OR SERVICE LAND
TO THE SOUTH AS REQUESTED BY MR. ROGERS. THIS IS
THE SECOND PAYMENT AND WE ARE CURRENTLY
WAITING FOR AN OFFICAL [sic] SURVEY. THIS PAYMENT IS
TOWARD THE ORIGINAL AGREED PURCHASE PRICE TOTAL
OF [$]29,500.00 (TWENTY NINE THOUSAND, FIVE HUNDRED
DOLLARS), WHICH WASN’T NOTED ON THE FIRST RECEIPT.
Daniel asserts that the parties originally agreed to settle “after completion of the
survey and subdivision,” but “at the Rogers’ request the parties agreed instead for
Daniel to begin making monthly payments toward the purchase price, with
settlement to occur at such a time as the purchase price was paid in full.”2
In addition to the June and October 2014 payments, Daniel made 26
monthly payments towards the purchase of the two-acre property between
2
Verified Pet. ¶ 17 (Aug. 22, 2017).
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 4 of 20
December 2014 and January 2017.3 Daniel provided written receipts for each
payment, with Ernest signing each receipt, sometimes after the notation “payment
received by” or “received by.”4 Ernest and Tammie owned the two-acre property
by joint tenancy with the right of survivorship. Tammie did not sign any of the
receipts. Daniel alleges that Tammie “was present during [the contract’s]
negotiation and execution and [she] provided every indication that she accepted its
terms and Mr. Rogers’ authority to bind her to the same.”5 He also asserts that
Tammie was present “almost every time a monthly payment was delivered and
accepted” by Ernest, and, on occasion, Ernest would hand the funds directly over
to Tammie.6
Daniel contends that he contacted the Rogers about completing the survey
and purchase of the two-acre property in the spring of 2016, but they indicated the
“survey could not be completed until after the first of the year” because of the
terms of an existing farm lease that would expire on December 31, 2016.7 Daniel
3
Daniel presented evidence he has paid a total amount of $16,500 on the $29,500 purchase price,
and made payments in the amount of $1,000 in June, October and December 2014, and May and
June 2015. The remaining 23 monthly payments were for $500. Id. Ex. C, D.
4
Id. ¶ 18, Ex. D.
5
Id. ¶ 14.
6
Id. ¶¶ 19-20.
7
Id. ¶ 23.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 5 of 20
presented evidence that his son, who he intended to live on the property, had house
plans drawn up in July 2016 to build a house on the 2-acre property.
Through a deed dated November 10, 2016, Ernest and Tammie transferred
their entire 118-acre property, without payment of monetary consideration and
without reserving the two-acre property, to Charles. Subsequent to that transfer,
the Rogers continued to accept monthly payments from Daniel on the two-acre
property on November 21, 2016, December 20, 2016, and January 20, 2017.
Daniel claims that, between January 20th and mid-February 2017, he received
permission from the Rogers to survey the two-acre property and, on one occasion,
Charles joined him to assist with the measurements in placing corner markers on
the property but did not inform Daniel that the Rogers had deeded the entire 118-
acre property to him. During the same time, the Rogers began asking to extend the
proposed service lane from 10-15 feet to 40-50 feet. Then in mid-February 2017,
Charles asked Daniel to contact a particular attorney, and the attorney told Daniel
about the transfer between the Rogers and Charles, which the attorney said was a
gifted transaction, and stated his view that the contract was unenforceable and
invalid.
ANALYSIS
A. Standard of review for failure to state a claim under Rule 12(b)(6)
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 6 of 20
The Court may dismiss parties’ claims for failure to state a claim under
Court of Chancery Rule 12(b)(6). The facts for purposes of the motion to dismiss
under Rule 12(b)(6) are drawn from the complaint and all well-pled allegations in
the complaint are assumed to be true and the petitioner receives the benefit of all
reasonable inferences.8 Conclusions in the complaint are not accepted as true
without allegations of facts to support them.9 But vagueness or lack of detail are
not sufficient grounds alone to dismiss for failure to state a claim so long as the
complaint provides the defendant with notice of the claim. 10 Failure to plead an
element of a claim is grounds for dismissal of that claim.11 A broad brush must be
used in determining sufficiency of claims – whether a plaintiff may recover under
any reasonably conceivable set of circumstances susceptible of proof.12 If recovery
on a particular claim is not reasonably conceivable, then the Court grants the
8
See In re Tri-Star Pictures, Inc., Litig., 634 A.2d 319, 326 (Del. 1993) (citation omitted);
Prairie Capital III, L.P. v. Double E Holding Corp., 132 A.3d 35, 49 (Del. Ch. 2015).
9
In re Tri-Star Pictures, Inc., Litig., 634 A.2d at 326.
10
Cent. Mortg. Co. v. Morgan Stanley Mortg. Capital Holdings LLC, 27 A.3d 531, 536 (Del.
2011); Morgan v. Wells, 80 A.2d 504, 505 (Del. Ch. 1951).
11
Cf. Pulieri v. Boardwalk Properties, LLC, 2015 WL 691449, at *5 (Del. Ch. Feb. 18, 2015);
Zebroski v. Progressive Direct Ins. Co., 2014 WL 2156984, at *6 (Del. Ch. Apr. 30, 2014).
12
Cent. Mortg. Co., 27 A.3d at 536, citing Savor, Inc. v. FMR Corp., 812 A.2d 894, 896-97 (Del.
2002).
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 7 of 20
motion and dismisses that claim under Rule 12(b)(6). If recovery is reasonably
conceivable, the motion to dismiss is denied.13
B. Standard of review for specific performance
Daniel seeks specific performance of his contract with the Rogers for the
sale of the two-acre property.14 A party seeking specific performance of an
agreement for the sale of real estate must establish by clear and convincing
evidence that he has a valid contract, he is ready, willing and able to perform his
obligations under the contract, and that the balance of equities tips in his favor.15
He must also show that no adequate legal remedy exists.16 Specific performance is
an “extraordinary remedy” available at the discretion of the court.17 The legal
standard here is whether it is reasonably conceivable that Daniel can establish a
right to specific performance of the real estate contract by clear and convincing
evidence.
13
Cf. Pulieri, 2015 WL 691449, at *5; In re Tri-Star Pictures, Inc., Litig., 634 A.2d at 326;
Spence v. Funk, 396 A.2d 967, 968 (Del. 1978).
14
In their reply, Respondents state they are not claiming there was “no contract between the
parties” but that the contract did not sufficiently identify essential terms necessary for specific
performance. Resp’ts’ Reply Br. 4-5 (Nov. 30, 2017).
15
Cf. Pulieri, 2015 WL 691449, at *5 (citing Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153,
1158 (Del. 2010)); Walton v. Beale, 2006 WL 265489, at *3 (Del. Ch. Jan. 30, 2006).
16
W. Willow-Bay Court, LLC v. Robino-Bay Court Plaza, LLC, 2007 WL 3317551, at *12 (Del.
Ch. Nov. 2, 2007).
17
Pulieri, 2015 WL 691449, at *6.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 8 of 20
C. Is it reasonably conceivable that Daniel can prove a valid contract
exists for specific performance?
The essential terms of a real estate contract are the names of the buyer and
seller, description of the property to be sold, sales price or the means of
determining the price, the terms and conditions of the sale, and the signature of the
party to be charged.18 Specific performance will not be granted if the terms of the
contract are unclear or if the court has to supply the meaning to essential terms of a
contract.19 In determining whether contract terms are sufficiently definite to
support specific performance, the court avails itself of the usual contract
construction aids, including common usage, reasonable implications of fact, and
consideration of the uncertain part of the contract “in its relation to the contract as
a whole.”20 Ambiguity can be explained by oral testimony or other evidence, and
the intention of the parties disclosed by “presumptions arising in the light of the
facts and circumstances and by the use of common sense.”21 An agreement may be
enforceable “even where some of its terms are left to future determination.”22
18
Id.
19
Walton, 2006 WL 265489, at *3.
20
Lee Builders, Inc. v. Wells, 92 A.2d 710, 714 (Del. Ch. 1952), rev’d on other grounds, 99 A.2d
620 (Del. 1953).
21
Id.
22
Estate of Osborn ex rel. Osborn v. Kemp, 2009 WL 2586783, at *8 (Del. Ch. Aug. 20, 2009),
aff'd sub nom. Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153 (Del. 2010).
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 9 of 20
Respondents argue that Daniel’s claim for specific performance fails
because the real estate contract lacks sufficiently definite essential terms to be
enforceable. Respondents claim the missing essential terms are a definite
settlement date, a sufficiently detailed description, and Tammie’s signature. They
also contend that the absence of Tammie’s signature violates the Statute of Frauds
and, without her signature, the contract is unenforceable because Ernest, a joint
owner with the right of survivorship with Tammie, did not have the legal capability
to convey the property since the contract intended the sale of a “fee simple
interest.”23 Further, they assert that the need to obtain third-party approvals prior
to conveyance of the two-acre property – for the subdivision from the county’s
planning and zoning office and for an entrance permit from the Delaware
Department of Transportation (hereinafter “DelDOT”) – precludes specific
performance.
Daniel responds that the two-acre property is uniquely suited to meet
Daniel’s purpose, and that the contract addresses all of the essential terms. He
asserts that the June and October 2014 receipts memorialize contract terms,
including the $29,500 price, sufficiently describe the property, and contain Ernest’s
signature. He further argues that the settlement date was to occur when the price
23
Resp’ts’ Reply Br. 6.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 10 of 20
was paid in full, which the parties could ascertain based upon the payment
arrangement; the survey and subdivision are not material to specific enforcement
of the sales contract; the Rogers are equitably estopped from claiming the lack of a
survey and subdivision as deficiencies invalidating the contract, since they
prevented Daniel from obtaining the survey until the end of 2016; and Tammie,
through her words and acts, evidenced her agreement to the contract and held
Ernest out as having apparent authority to act as her agent. Further, Daniel claims
that partial performance through his payments, and the Rogers’ acceptance of those
payments, at generally monthly intervals from June 2014 through January 2017,
excepts the contract from the Statute of Frauds requirement that contracts for the
sale of lands be signed by the person(s) charged. And, even if it is determined that
only Ernest is bound by the contract, Daniel alleges that Ernest’s share of the joint
tenancy can be severed through his actions and a tenancy in common created
though the sale of Ernest’s one-half interest in the property.
Here, I conclude it is reasonably conceivable Daniel can prove, by clear and
convincing evidence, that a valid contract exists for purposes of awarding specific
performance. First, I do not find Respondents’ argument that the lack of an exact
settlement date invalidates the contract persuasive. Courts have not always
required that a real estate contract contain an exact settlement date, but instead
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 11 of 20
have looked at whether the parties’ intention as to the timing of the settlement can
be determined.24 In Walton v. Beale, a draft written contract between the parties
contained a settlement date; however, that date had long since passed without a
new date being set.25 The Court found that since the parties “either had or planned
to set a settlement date” at all times after the draft contract was prepared and before
the dispute arose, the settlement date was sufficiently definite.26 The Walton Court
looked beyond the expired date in the draft contract to determine the parties’
intentions – or plans – as to the timing of settlement, based upon the circumstances
surrounding their agreement. Here, it is reasonably conceivable that evidence can
be presented to show the parties’ intentions concerning the timing of settlement.
The Court’s holding in Pulieri v. Boardwalk Properties, LCC concerning the
definiteness of the timing of the property transfer is distinguishable from this case.
24
Cf. Estate of Osborn ex rel. Osborn, 2009 WL 2586783, at *8 (the Court held the parties
understood that settlement would occur “sometime after” a particular date assuming that the
party purchasing the property performed his obligations “in the interim”); Walton, 2006 WL
265489, at *5; Heckman v. Nero, 1999 WL 182570, at *4 (Del. Ch. Mar. 26, 1999) (holding the
contract does not fail because “no time was provided for settlement,” because “a reasonable time
will be implied,” if there is no provision as to the time of performance in the contract).
Respondents’ reliance on River Enterprises, LLC v. Tamari Properties, LLC, 2005 WL 356823
(Del. Ch. Feb. 15, 2005), is misplaced. In River Enterprises, LLC, the Court stated that the
contract “reflect[ed] the parties’ agreement on all essential terms: price, date of settlement, and
the property to be sold.” Id. at *2. Since the contract contained a specific settlement date, the
parties’ intention as to the settlement date was not at issue. That Court held that the security for
the deposit was not an essential term. Id.
25
Walton, 2006 WL 265489, at *2-*3.
26
Id. at *5.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 12 of 20
In Pulieri, property was transferred between the parties under an oral agreement
with the obligation that it be transferred back “upon the happening” of certain
conditions (when the financial health of certain entities improved and when a
particular individual’s interests in those entities had been removed).27 The Court
found that the timing of retransfer was not sufficiently definite to prove specific
performance because “upon the happening” was not defined, there was no metric
specified for discerning when the financial health of the entities had improved, and
the exact entities involved were not defined.28
Unlike the Pulieri case, here, the parties’ obligations were not controlled by
vague metrics or factors. It is reasonably conceivable that, as Daniel asserts, the
settlement date was to occur when the price was paid in full, and that the parties
planned to set a date, based upon the payment history and practices associated with
the contract.29 I conclude that it is reasonably conceivable that, in this case, the
parties’ intention as to the timing of settlement could be ascertained once the
evidence is fully developed.
27
Pulieri, 2015 WL 691449, at *7.
28
Id.
29
Respondents rely on the varying amount of the payments ($1,000 or $500) to support the
indefiniteness of the settlement date. The Petition alleges that, although five of the 28 payments
were for $1,000, the remaining 23 monthly payments, and every payment between August 2015
and January 2017 (when this dispute arose), were consistently for $500. See Verified Pet. Ex. C,
D.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 13 of 20
Second, I find that it is reasonably conceivable that Daniel can prove that the
property description in the contract, an essential term, is sufficiently definite. “A
property description is adequate if it renders with sufficient certainty the grantor’s
intention respecting the quantity and location of the land to be conveyed.”30 The
description does not need to “set forth precise dimensions in formal metes and
bounds.”31 Respondents argue that the size of the service lane was a subject of
disagreement between the parties and that the nature of the service lane – whether
a physical lane or easement – was not defined. Daniel responds that the contract
unambiguously depicts the service lane as the southern boundary line of the
property and that the exact acreage and location of lines would be determined
through a survey, which typically occurs after a sales contract is executed. I note
that Daniel alleges that the disagreement about the size of the service lane arose in
January 2017 – long after the parties entered into the contract and after the Rogers
had already transferred the property to Charles. I find the evidence, once fully
developed, could show the Rogers’ intention as to the location and quantity of the
property to be conveyed to Daniel was sufficiently definite to support specific
performance.
30
Walton, 2006 WL 265489, at *5.
31
Heckman, 1999 WL 182570, at *4 (finding the property description sufficiently definite, even
though the parties were unaware of the precise acreage but had walked the property line).
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 14 of 20
Third, Respondents argue that there is no valid contract for specific
performance because Tammie, who was a joint tenant with right of survivorship,
did not sign the receipts memorializing the contract or any of the receipts, and that
Daniel alleged that she was present for the negotiation and execution of the
contract but not that she “joined the contract.”32 Further, if Tammie’s words and
actions are deemed to constitute an oral agreement, Respondents contend that there
is no evidence for the Court to determine if Tammie agreed to the essential terms.33
Respondents argue Daniel’s reliance on Ernest’s apparent authority to act as
Tammie’s agent is not supported by law and that Ernest, as only a joint owner, did
not have the legal capability to convey the full property interest envisioned by the
contract.34
Respondents assert the absence of Tammie’s signature, in itself, voids the
contract for purposes of specific performance pursuant to Pulieri. The Court in
Pulieri did define essential terms for a real property contract to include “the
signature of the party to be charged.”35 And, the signature requirement is
consistent with the Statute of Frauds, which provides that actions cannot be
32
Resp’ts’ Mot. to Dismiss 8 (Oct. 6. 2017).
33
Resp’ts’ Reply Br. 4-5.
34
Id. at 5-6.
35
Pulieri, 2015 WL 691449, at *6.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 15 of 20
brought to enforce the sale of lands “unless the contract is reduced to writing, or
some memorandum, or notes thereof, are signed by the person to be charged
therewith.”36 However, there is a well-established exception to the Statute of
Frauds that partial performance of an oral contract may be enforced by specific
performance.37 The actual part performance must be an act which indicates the
“mutual assent” of the parties to the contract, including “making partial or full
payment for the land.”38 It is evident that, in any oral contract, there would not be
signatures of the parties. Although the Pulieri Court defined essential terms for a
written real estate contract, it analyzed the terms of an oral contract between the
parties in that case, and declined to order specific performance because of
indefinite essential terms and not due to the absence of signatures. In this case,
Daniel alleges he had a contract which was memorialized in writing and signed by
Ernest. Daniel could show that the contract satisfies the Statute of Frauds
requirements for contracts for the sale of land as relates to Ernest. As for Tammie,
Daniel contends there is partial performance of the contract because he remitted,
and Ernest and Tammie accepted, partial payments on the contract. He argues that
Tammie is obligated under the contract through her words and acts because she
36
6 Del. C. § 2714(a).
37
Walton, 2006 WL 265489, at *4; Heckman, 1999 WL 182570, at *3.
38
Walton, 2006 WL 265489, at *4.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 16 of 20
held Ernest out as her apparent agent in this agreement, and she was present when
the monthly payments were delivered and accepted some of those payments
personally from Ernest, among other acts. Further, Daniel asserts that the
Respondents are equitably estopped from claiming that the Statute of Frauds
forecloses the contract, since Daniel took actions detrimental to him in reliance on
the Respondents’ conduct.39 I find that it is reasonably conceivable that Daniel
could prove that there was an oral contract with Tammie, based upon similar terms
as the memorialized contract with Ernest, and that there was partial performance of
the contract sufficient to obligate Tammie. I, therefore, do not need to analyze
Daniel’s apparent agent and equitable estoppel arguments at this time.
Respondents argue that since the property was held jointly, the contract was
unenforceable, regardless of Ernest’s actions, without Tammie’s agreement.40
Although Ernest and Tammie held the two-acre property jointly with the right of
survivorship, at the time the alleged contract was entered into, Ernest’s actions
alone can sever the unities of the title, and he can sell his interest in the property
39
Pet’r’s Answering Br. 21-22 (Nov. 13, 2017).
40
Resp’ts’ Am. Opening Br. on Mot. to Dismiss 14 (Oct. 12, 2017). Respondents claim that the
contract was for a fee simple interest in the property and invalid if only a partial interest is being
conveyed. Resp’ts’ Reply Br. 6-7. The factual record, once developed, will help address this
argument.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 17 of 20
separately from Tammie’s interest. If one of the joint tenants sells their interest in
the property, they break the joint tenancy and create a tenancy in common. 41
Finally, Respondents argue that since the two-acre property has not been
subdivided from the 118-acre parcel, specific performance is inappropriate because
the consent of third parties, such as the Sussex County office of planning and
zoning and DelDOT, is needed for the contract to be enforced. This Court has held
that governmental approvals necessary for the completion of the sale are not a bar
to specific performance.42
Finally, Respondents argue that Daniel has not performed his obligations
under the alleged contract and has not even obtained the survey on the two-acre
41
In re Ellingsworth, 266 A.2d 890, 891 (Del. Ch. 1970); Korn v. Korn, 2015 WL 1862784, at
*7 (Del. Ch. Apr. 22, 2015) (“[t]he common law has long recognized a right to sever the unities
[of a joint tenancy with the right of survivorship] and create a tenancy in common through sale
of one owner's interest”).
42
Heckman v. Nero, 2000 WL 1041226, at *7, n. 2 (Del. Ch. May 31, 2000) (“Impliedly, this
Court found in the Memorandum Opinion that the fact that consummation of the sale would
require the assent of Planning and Zoning was not a bar to specific performance”). The
application of the defense of impossibility of performance would be premature in this case, since
there is no evidence that the necessary governmental approvals have been sought and refused.
See id. at *4. See generally, Grynberg v. Burke, 1981 WL 17034, at *8 (Del. Ch. Aug. 31, 1981)
(“A promisor is bound to perform his contract unless it was unlawful when made, or has since
become impossible of performance through no fault of his. This impossibility may be caused . . .
by governmental act”). Respondents rely on W. Willow-Bay Court, LLC v. Robino-Bay Court
Plaza, LLC, 2007 WL 3317551 (Del. Ch. Nov. 2, 2007), in which the Court found specific
performance to be inappropriate where the contract at issue was contingent upon the seller’s
obtaining a third-party’s consent, and that consent could be withheld regardless of the seller’s
actions. Respondents’ reliance on Willow-Bay Court is misplaced because, unlike the third party
in that case, the governmental entities follow objective criteria in determining whether a minor
subdivision is approved.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 18 of 20
property needed to obtain governmental approvals.43 Daniel responds that
Respondents should be equitably estopped from asserting nonperformance of the
survey because they prevented him from obtaining a survey until 2017, citing the
terms of their agricultural lease.44 Respondents reply that “it is blatantly obvious”
that the existence of an agricultural lease would not preclude the performance of a
simple survey, making Daniel’s reliance on such a statement unreasonable.45
Equitable estoppel may be invoked when a party intentionally or
unintentionally leads another, relying on that conduct, to change his position to his
detriment.46 The party claiming estoppel must show that he lacked knowledge or
the means to obtain knowledge of the truth of the facts in question, relied on the
conduct and suffered a prejudicial change of position as a result.47
The factual record needs to be developed to show whether Daniel performed
his obligations under the contract and, if performance of the survey is an issue,
whether equitable estoppel applies in this case.
D. Is it reasonably conceivable that Daniel can show the other elements
needed for specific performance of the contract?
43
Resp’ts’ Mot. to Dismiss 12.
44
Pet’r’s Answering Br. 18-19.
45
Resp’ts’ Reply Br. 11-12.
46
Heckman, 1999 WL 182570, at *3.
47
Id.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 19 of 20
In addition to showing the existence of a valid contract, the party seeking
specific performance needs to show that he is ready, willing and able to perform on
the contract and that the balance of equities tips in his favor. Daniel argues that he
is ready, willing and able to perform on the contract, has maintained sufficient
assets to pay the entire balance of the purchase price, and in March of 2017,
offered to tender the balance of the purchase price to either the Rogers or Charles.
And Daniel believes the equities tip in his favor because he selected the property
because of its size, location, surrounding, and proximity to family members and the
private school attended by his son’s children, for his son to build a house on the
property; he has searched the nearby area and has been unable to locate a substitute
property; Ernest intentionally misrepresented his authority to convey full title of
the property and Tammie intentionally concealed her ownership interest; the
Rogers intentionally delayed Daniel’s efforts to perform a survey on the property;
and Charles and the Rogers privately negotiated the conveyance of the property,
with full prior knowledge of the sale contract with Daniel; and the Rogers withheld
notice of the transfer to Charles from Daniel and accepted three more payments
under the contract after the transfer.48 Based upon the allegations before me, I
conclude it is reasonably conceivable Daniel can show that he is ready, willing and
48
Verified Pet. ¶ 61.
Daniel F. Morton, Jr. v. Ernest L. Rogers, Jr, Tammie L. Rogers, and Charles
Douglas Morton, Jr.
C.A. No. 2017-0603-PWG
February 22, 2018
Page 20 of 20
able to perform his contractual obligations, and that the balance of equities tips in
favor of specific performance.
CONCLUSION
Viewing the well-pled allegations and all reasonable inferences from those
allegations most favorably to Daniel, I find that it is reasonably conceivable that
Daniel could prove, by clear and convincing evidence, his claim for specific
performance of the contract for the two-acre property. Accordingly, I recommend
that the Court deny the Respondents’ motion to dismiss, and that Daniel be
allowed the opportunity to present his case based upon a fully developed record.
Further, with the Court’s denial of the Respondents’ claim that Daniel failed
to state a claim for relief, I recommend that the Court conclude it is unnecessary to
consider Respondents’ arguments concerning the dismissal of Daniel’s other
claims for lack of subject matter jurisdiction.
This is a final report. Exceptions may be taken pursuant to Court of
Chancery Rule 144.
Sincerely,
/s/ Patricia W. Griffin
Patricia W. Griffin
Master in Chancery
PWG/kekz