IN THE COURT OF CHANCERY FOR THE STATE OF DELAWARE
)
KEITH WEBB, )
)
Plaintiff, )
) C.A. No. 2021-1070-MTZ
v. )
)
KEVIN WEBB, )
)
Defendant. )
ORDER DENYING MOTION TO DISMISS
WHEREAS, having considered the defendant’s motion to dismiss and
briefing,1 it appears:
A. In 1995, plaintiff Keith Webb (“Plaintiff”) purchased 4 Knickerbocker
Drive, Newark, Delaware (the “Property”), and has lived there since. Because
Plaintiff lacked sufficient credit to obtain the mortgage, Plaintiff’s parents, Harvey
Jay Webb (“Father”) and Hilda J. Webb (“Mother”, and together with Father,
“Parents”) cosigned a mortgage with Plaintiff (the “1995 Mortgage”). The recorded
1
All facts are drawn from the complaint, the documents integral to it, and those that are
incorporated by reference. See Wal-Mart Stores, Inc. v. AIG Life Ins. Co., 860 A.2d 312,
320 (Del. 2004). I also take judicial notice of certain filings with the Register of Wills.
Arot v. Lardani, 2018 WL 5430297, at *1 n.6 (Del. Ch. Oct. 29, 2018).
deed to the Property is in the name of Parents as husband and wife and Plaintiff, as
tenants in common.2
B. Simultaneously with that deed, Parents and Plaintiff executed an
agreement dated October 27, 1995 (the “Agreement”), in which Parents made two
promises:
[1] H. Jay Webb and Hilda J. Webb hereby contract to amend their
respective wills to reflect that their interest in 4 Knickerbocker Drive
shall be devised to Keith J. Webb should he survive them, and to Brenda
D. Cameron, should Keith J. Webb not survive them.
[2] H. Jay Webb and Hilda J. Webb hereby agree that at such time as
the [1995 M]ortgage . . . to which they are co-signers should be paid
off, they will convey their interest in [the Property] to Keith J. Webb.3
C. Additionally, the Agreement provided:
This agreement reflects the parties[’] intent that Hilda J. and H. Jay
Webb are co-signers only on the Note and the Mortgage
aforementioned; That [sic] Keith J. Webb and Brenda D. Cameron will
supply the funds to purchase [the Property], have the right to live there
and the duty to maintain the premises and to pay the monthly mortgage
payments.4
Plaintiff pleads that Parents “never wanted to own the Property and merely viewed
the fact that they were on the title as an accommodation to Plaintiff, their son, in
order to enable him to obtain a mortgage on the Property.”5
2
Docket Item (“D.I.”) 1 [hereinafter “Compl.”], Ex. A.
3
Compl. Ex. B.
4
Id.
5
Compl. ¶ 5.
2
D. Father passed away on August 28, 2000. Father’s interest in the
Property passed to Mother, without apparent complaint by Plaintiff.6
E. Plaintiff refinanced the Property “on more than one occasion.”7 The
most recent loan, and the only existing loan secured by the Property, was initiated in
2008, and the signatories are Plaintiff and Mother. Neither Parent conveyed their
interest in the Property to Plaintiff following a refinancing.
F. Mother passed away on August 11, 2018.8 Contrary to the Agreement,
Mother did not amend her will to devise her interest in the Property to Plaintiff: she
devised all her property, including real property, in equal shares unto Plaintiff and
his brother, defendant Kevin Webb (“Defendant”).9 In accordance with Mother’s
will, Plaintiff, represented by counsel, was the executor of Mother’s estate. 10 On
September 19, 2019, Plaintiff’s counsel submitted a Real Estate Memo indicating
Plaintiff and Defendant were each entitled to half of Mother’s 50% share of the
Property.11 That same day, Plaintiff’s counsel also filed a letter stating:
6
New Castle County Register of Wills [“ROW”], Folio No. 123148, D.I. 1.
7
Compl. ¶ 6.
8
ROW Folio No. 170501 AF, D.I. 1 at Death Certificate (Certified).
9
ROW Folio No. 170501 AF, D.I. 4 at THIRD.
10
ROW Folio No. 170501 AF, D.I. 1 at Letter; ROW Folio No. 170501 AF, D.I. 3.
11
ROW Folio No. 170501 AF, D.I. 12 at 2.
3
Please be advised that we have stated the ownership interests on the
[P]roperty . . . for convenience only on the inventory list and that there
is a dispute over the actual percentage ownership of that property. I am
hopeful that the parties in interest can reach an agreement but, if not,
we do intend to assert our client[’]s rights to the [P]roperty.12
The estate was closed on September 28, 2021.13
G. Plaintiff and Defendant did not reach an agreement concerning the
Property, and Plaintiff filed this action on December 9, 2021. In his complaint (the
“Complaint”), Plaintiff pleads that “[b]ecause the Property was never deeded by his
parents to Plaintiff and because his parents failed to revise their wills as promised,
Defendant is now claiming an interest in the Property which he contends was
received by him through the estate of [Mother].”14 Plaintiff presses one count titled
“Quiet Title and Specific Performance,” by which he seeks a declaration that
Defendant has no right to the Property and an order compelling Defendant to transfer
title to Plaintiff.15
H. On February 23, 2022, Defendant moved to dismiss under Court of
Chancery Rule 12(b)(6) (the “Motion”), arguing both 12 Del. C. § 2102 and the
12
ROW Folio No. 170501 AF, D.I. 11.
13
ROW Folio No. 170501 AF, D.I. 25.
14
Compl. ¶ 9.
15
Id. ¶¶ 10–13; id. at Wherefore ¶¶ 1–2.
4
doctrine of laches bar Plaintiff’s claim.16 The parties briefed the Motion,17 but were
quiet thereafter, failing to request oral argument or consideration on the papers; the
Court took the Motion under advisement on the papers on March 15, 2023.18
I. The standard governing a motion to dismiss under Court of
Chancery Rule 12(b)(6) is familiar:
(i) [A]ll well-pleaded factual allegations are accepted as true; (ii) even
vague allegations are “well-pleaded” if they give the opposing party
notice of the claim; (iii) the Court must draw all reasonable inferences
in favor of the non-moving party; and [(iv)] dismissal is inappropriate
unless the “plaintiff would not be entitled to recover under any
reasonably conceivable set of circumstances susceptible of proof.”19
The touchstone “to survive a motion to dismiss is reasonable ‘conceivability.’”20
This standard is “minimal”21 and plaintiff-friendly.22 “Indeed, it may, as a factual
matter, ultimately prove impossible for the plaintiff to prove [its] claims at a later
stage of a proceeding, but that is not the test to survive a motion to dismiss.”23
16
D.I. 6 at Mot. to Dismiss; D.I. 6 at Op. Br.
17
D.I. 6 at Op. Br.; D.I. 10 at Ans. Br.; D.I. 11 at Reply Br.
18
D.I. 13.
19
Savor, Inc. v. FMR Corp., 812 A.2d 894, 896–97 (Del. 2002) (footnotes omitted)
(quoting Kofron v. Amoco Chems. Corp., 441 A.2d 226, 227 (Del. 1982)).
20
Cent. Mortg. Co. v. Morgan Stanley Mortg. Cap. Hldgs. LLC, 27 A.3d 531, 537 (Del.
2011).
21
Id. at 536.
22
E.g., Clouser v. Doherty, 175 A.3d 86, 2017 WL 3947404, at *9 (Del. 2017) (TABLE);
In re USG Corp. S’holder Litig., 2021 WL 930620, at *3–4 (Del. Ch. Mar. 11, 2021); In
re Trados Inc. S’holder Litig., 2009 WL 2225958, at *8 (Del. Ch. July 24, 2009).
23
Cent. Mortg. Co., 27 A.3d at 536.
5
Despite this forgiving standard, the Court need not accept conclusory allegations
unsupported by specific facts or draw unreasonable inferences in favor of the
nonmoving party.24 “Moreover, ‘the court is not required to accept every strained
interpretation of the allegations proposed by the plaintiff.’”25
J. Section 2102, in relevant part, reads:
(a) All claims against a decedent’s estate which arose before or at the
death of the decedent, including claims of the State and any subdivision
thereof, whether due or to become due, absolute or contingent,
liquidated or unliquidated, founded on contract, tort or other legal basis,
except debts of which notice is presumed pursuant to § 2103 of this
title, if not barred earlier by other statute of limitations, are barred
against the estate, the personal representative and the heirs and devisees
of the decedent unless presented as provided in § 2104 of this title
within 8 months of the decedent’s death whether or not the notice
referred to in § 2101 of this title has been given.
(b) All claims against a decedent’s estate which arise after the death of
the decedent, including claims of the State or any subdivision thereof,
whether due or to become due, absolute or contingent, liquidated or
unliquidated, founded on contract, tort or other legal basis, unless
presented in accordance with § 2104 of this title, are barred against the
estate, the personal representatives and the heirs and devisees of the
decedent, as follows:
(1) A claim based on a contract with the personal representative,
within 6 months after performance by the personal representative
is due;
(2) Any other claim, within 6 months after it arises.26
24
E.g., Clinton v. Enter. Rent-A-Car Co., 977 A.2d 892, 895 (Del. 2009).
25
Trados, 2009 WL 2225958, at *4 (quoting In re Gen. Motors (Hughes) S’holder Litig.,
897 A.2d 162, 168 (Del. 2006)).
26
12 Del. C. § 2102(a)–(b).
6
Section 2102 is a non-claim statute, and therefore terminates an estate’s capacity to
be sued after the stated period.27 Claims that are not timely presented are forever
barred against the estate.28
IT IS ORDERED this 10th day of July, 2023, that:
1. I read Plaintiff’s claim to be sourced in three theories: two breaches
of the Agreement, and an equitable theory. The first breach of contract theory is
based on the failure to convey Parents’ interest in the Property to Plaintiff when the
1995 Mortgage enumerated in the Agreement was paid off. Any claim brought
under this theory arose at some time before Mother’s death, and is therefore
governed by Section 2102(a).29 Because Plaintiff filed this action more than eight
months after Mother’s death, a claim based on that theory is untimely.30
27
Sherman v. State, 133 A.3d 971, 979–81 (Del. 2016).
28
Id. at 980 (citing Cummings v. Estate of Lewis, 2013 WL 2987903 (Del. Ch. June 17,
2013)).
29
The Complaint is not clear as to when this claim arose, and the parties do not expressly
address the issue. The Complaint states that the mortgage on the Property was refinanced
in 2008, but neither party addresses whether that refinancing satisfied the condition of
paying off the specified 1995 Mortgage, thus triggering Mother’s obligation to convey her
interest in the Property to Plaintiff.
30
At times, Plaintiff’s answering brief in opposition to the Motion appears to argue that
there was a breach of the Agreement, but that Plaintiff has not yet completed performance
under the Agreement. To the extent this is Plaintiff’s theory, it is unripe, and dismissed on
those grounds. See Envo, Inc. v. Walters, 2009 WL 5173807, at *4 n.10 (Del. Ch. Dec.
30, 2009) (“The issue of subject matter jurisdiction is so crucial that it may be raised at any
time before final judgment and by the court sua sponte.”).
7
2. The second contractual theory is based on Mother’s failure to amend
her will to devise her interest in the Property to Plaintiff. There is no dispute that
the Agreement is, in part, a contract to amend a will. Such contracts “implicate
special concerns for the court . . . . Foremost among them is the potential to obstruct
the prompt settlement of decedents’ estates—a clear policy goal of our statutory
law.”31 A claim for a breach of a contract to amend a will typically, except in
circumstances not present here, arises upon the death of the decedent.32 Such a
claim is therefore governed by Section 2102(b). Plaintiff did not submit a claim
against Mother’s estate within six months of her death; indeed, his counsel’s letter
of September 29, 2019, invoking Plaintiff’s purported “rights to the [P]roperty,”
was filed over twelve months after Mother’s death.33 A claim based on that theory
is untimely as well.
3. Plaintiff attempts to save these breach of contract theories by arguing
they are not governed by Section 2102 because Mother’s interest in the Property
passed directly to the heirs, not to the estate. It is true that under Delaware law,
property passes directly to the heirs.34 But Plaintiff is seeking to enforce a contract
31
Eaton v. Eaton, 2005 WL 3529110, at *5 (Del. Ch. Dec. 19, 2005).
32
Id. at *6.
33
Instead, over twelve months after Mother’s death, Plaintiff’s counsel submitted the Real
Estate Memo to the Register of Wills attesting that Plaintiff and the decedent were each
entitled to a 50% share of the Property. ROW Folio No. 170501 AF, D.I. 12, sch. A.
34
See Moore v. Davis, 2011 WL 3890534, at *2 (Del. Ch. Aug. 29, 2021).
8
he had with Parents, and he has made no showing that the promise is enforceable
against any successors or heirs.
4. Plaintiff also contends that Section 2102 does not apply because the
purpose of Section 2102 is to direct the presentation of claims to the personal
representative, and that because he was the personal representative, he was duly
aware of his claim against Mother’s estate. Not so: the purpose of Section 2102 is
the prompt administration of estates.35 Plaintiff is not excused from that statutory
directive because he was personal representative: it is his responsibility to
administer the estate promptly. Nothing in t plain language of Section 2102 excuses
personal representatives.
5. Plaintiff’s third theory appeals to this Court’s equitable powers. I read
the Complaint to be asserting an equitable claim seeking the imposition of a
resulting trust based on an understanding between Plaintiff and Parents. “A
resulting trust arises from the presumed intentions of the parties and upon the
circumstances surrounding the particular transaction,”36 and the Court will impose
such a trust to give effect to those presumed intentions.37 Resulting trusts are
intended to address situations where “legal title to property is transferred, conveyed,
35
See Sherman, 133 A.3d at 980.
36
Adams v. Jankouskas, 452 A.2d 148, 152 (Del. 1982).
37
Wagner, 2000 WL 238009, at *6 (quoting Hudak v. Procek, 727 A.2d 841, 843 (Del.
1999)).
9
or otherwise disposed of and it appears from the attendant circumstances or the
terms of the conveyance that the parties intended that the beneficial interest in the
subject property would not be enjoyed by the holder of legal title—or, in other
words, that legal title and beneficial ownership would not be in the same hands.”38
6. A resulting trust may “arise when one party provides money to
purchase property, the title to which is in the name of another.”39 Under such
circumstances, the Court may impose a resulting trust where: (1) the person seeking
to establish the trust paid the consideration for the property at issue; (2) the parties
intended for the payor to be the equitable owner; and (3) “the payment made or
liability incurred [is] . . . part of the original transaction of purchase and [was not
made] pursuant to any subsequent agreement between the parties.”40 “Equity
presumes, ‘absent contrary evidence, that the person supplying the purchase money
for property intends that its purchase will inure to his benefit, and the fact that title
is in the name of another is for some incidental reason.’”41
38
2 Donald J. Wolfe, Jr. & Michael A. Pittenger, Corporate and Commercial Practice in
the Delaware Court of Chancery § 16.07[c][1], at 16-106.
39
Id. at 16-107.
40
Wagner, 2000 WL 238009, at *6 (internal quotation marks omitted) (citing Greenly v.
Greenly, 49 A.2d 126, 129 (Del. Ch. 1946); and then quoting Wells v. Boardley, 1983 WL
21370, at *2 (Del. Ch. Sept. 12, 1983)).
41
Hudak v. Procek, 727 A.2d 841, 843 (Del. 1999) (quoting Adams, 452 A.2d at 152).
10
7. The Complaint pleads that Plaintiff paid the purchase price for the
Property,42 and so he is entitled to a presumption that he and Parents intended the
Property for his benefit, and that Parents were on the deed for an incidental reason.43
The Complaint also pleads facts consistent with the view that Parents intended for
Plaintiff to have equitable ownership of the property, including the fact Plaintiff was
the sole occupant for over twenty-seven years and that he paid all expenses relating
to the Property. Defendant has not argued that these facts are insufficient for
Plaintiff’s equitable claim to survive a motion to dismiss.
8. The imposition of a resulting trust would preclude the application of
Section 2102, and therefore Section 2102 does not warrant dismissal at this stage.44
But a claim seeking the imposition of a resulting trust can be subject to a laches
defense.45 Plaintiff’s claim seeking an equitable trust is an equitable claim seeking
an equitable remedy that has no legal analog.46 Thus, there is no analogous statute
of limitations for the Court to look to, and a traditional laches analysis is
42
The Agreement states that Plaintiff and his then-spouse Brenda Cameron supplied the
funds to purchase the Property. They have since divorced, and the Complaint does not
expressly address Cameron’s rights in the Property, if any. At this stage, I do not view the
possibility that Cameron paid part of the purchase price as affecting the analysis.
43
Hudak, 727 A.2d at 843.
44
Adams, 452 A.2d at 154.
45
See, e.g., id. at 157–58.
46
Quill v. Malizia, 2005 WL 578975, at *15 n.49 (Del. Ch. Mar. 4, 2005).
11
applicable.47 That analysis is fact-intensive, and is more appropriate at a later stage
of the proceedings, when the record is further developed.48
9. Defendant’s Motion is DENIED. The parties should submit a
stipulated case scheduling order.
/s/ Morgan T. Zurn
Vice Chancellor
47
See id.; Hudak, 727 A.2d at 843.
48
See, e.g., Calesa Assocs., L.P. v. Am. Cap., Ltd., 2016 WL 770251, at *15 (Del. Ch. Feb.
29, 2016) (“I consider the fact-intensive laches analysis—in light of the fact that that the
analogous statute of limitations had not run at the filing of the Complaint—to be better
deferred to a time when the record is more developed.”).
12