IN THE MATTER OF THE ESTATE OF RICHARD L. DEGROAT, deceased.
Submitted: September 18, 2017
J. Ferry, Esquire and Brian J. Ferry, Esquire, of FERRY
JOSEPH, P.A., Wilmington, Delaware; Attorneys for Plaintiff.
C. Powell, Esquire, of THE POWELL FIRM, LLC, Wilmington,
Delaware; Attorney for Defendant.
T. ZURN MASTER IN CHANCERY
estate matter, a child of the decedent's first marriage
questions the extent to which the decedent intended to
benefit the decedent's second ex-wife. The petitioner
alleges that in the decedent's final years, the second
ex-wife utilized a power of attorney to name herself
beneficiary of several of the decedent's accounts,
influenced the decedent to execute a deed to convert
co-ownership of real property with the decedent from tenants
in common to joint tenants with the right of survivorship,
and sold the property and retained all the proceeds while the
decedent was still alive.
in this case are the plaintiff's July 3, 2017, motion to
compel; the plaintiff's July 5, 2017, motion to amend the
complaint; the defendant's August 2, 2017, motion to
dismiss; and the plaintiff's August 15, 2017, motion to
strike portions of the defendant's deposition errata
sheet. Each motion has been fully briefed. This is my final
report pursuant to Court of Chancery Rule 144. I recommend
the Court grant the motion to amend in part and deny it in
part, grant the motion to compel, and deny the motion to
strike. I view the motion to dismiss as a motion for summary
judgment and defer decision until all parties have presented
material pertinent to a dispositive motion.
L. DeGroat ("Decedent") and Jan DeGroat married in
or around 1954 and had five children: Plaintiff R. Michael
DeGroat ("Michael"), Thomas S. DeGroat, Carroll L.
Iacovetti, Brian C. DeGroat, and Andrew J. DeGroat.
and Decedent divorced, and Decedent married Defendant Lucinda
Papa in 1977. Decedent and Lucinda divorced in 2008. Lucinda
is currently married to Michael Ziatyk ("Ziatyk").
2001, seven years before Lucinda and Decedent divorced,
Lucinda and Decedent purchased a home at 3 Somerset Lane,
Newark, DE 19711 ("the Property") for $350, 000.00,
which they owned as tenants by the entirety. Lucinda and
Decedent's 2008 divorce converted that ownership into
tenancy in common. They divorced without any written divorce
decree or agreement addressing their property.
January 11, 2012, Decedent executed a will that gave a
specific gift of personal property to Decedent's
granddaughter, and divided the remaining estate among
Decedent's five children. The will states:
I direct the executor to sell my real estate for such price
and upon such terms and credits as my Executor deems proper.
I further authorize and direct the Executor to institute any
partition action necessary to sever any interests I have with
my ex-wife Lucinda P. DeGroat.
will names Michael as Decedent's executor.
alleges that Lucinda learned about this will and induced
Decedent to execute a power of attorney naming Lucinda as
agent on December 2, 2013. Michael alleges Lucinda improperly
used this power of attorney to designate herself as
beneficiary of several of Decedent's investment accounts
and life insurance policies. Michael contends Decedent
intended for those assets to pass to his children,
grandchild, and first wife Jan. Michael also alleges that
Lucinda moved Decedent out of the Property to an assisted
living facility and renovated the Property using
Decedent's funds, without his consent or authorization.
On October 1, 2014, the Property sold for $445, 640.00.
Michael alleges Lucinda kept all of the $402, 361.72 in
proceeds from the sale.
contends that when she and Decedent divorced, they agreed
that Lucinda should receive many of Decedent's assets,
including investment accounts and life insurance policies,
and that Lucinda (who was substantially younger than
Decedent) would assist Decedent as he aged. Lucinda also
contends that she and Decedent agreed she should renovate the
Property and keep the proceeds from its sale.
passed away, unmarried, on June 14, 2016. Under the terms of
Decedent's will, Michael was appointed executor of
Decedent's estate. Michael approached Lucinda regarding
Decedent's assets, and Lucinda provided an extensive
response stating she and Decedent had agreed Decedent would
give Lucinda his retirement accounts and funds from the sale
of the house, and Lucinda would care for Decedent as
needed. Lucinda's response did not satisfy
Michael, and Michael filed a complaint on September 9, 2016.
of Michael's complaint asserts Lucinda breached her
fiduciary duties as Decedent's agent and asks the Court
to invalidate Lucinda's transfers or retitling of assets.
Count II seeks an accounting of Lucinda's actions under
the power of attorney. Count III seeks a constructive trust
over assets Lucinda allegedly improperly obtained, and Count
IV seeks return of those assets under a theory of unjust
enrichment. Michael initiated this action in his personal
capacity and as executor of Decedent's estate. On
November 11, 2016, Lucinda answered and counterclaimed for
the costs she expended in assisting Decedent. Michael
answered the counterclaim on November 18, 2016. The parties
engaged in discovery.
in July 2017, the parties filed and briefed the pending
motion to compel, motion to amend the complaint, motion to
dismiss, and motion to strike. This is my final report.
I recommend the Court grant Plaintiff's motion to amend
the allegations and to add Ziatyk as a defendant,
but deny it as to adding Jan and Carroll as plaintiffs.
the benefit of discovery, Michael seeks to amend his
complaint to specify bank accounts and transactions
underlying Lucinda's alleged wrongful acts; to add Jan
and Carroll as plaintiffs because they were beneficiaries of
certain of Decedent's accounts and policies before
Lucinda named herself as beneficiary; and to add Ziatyk as a
defendant because he allegedly benefitted from Lucinda's
misappropriation of Decedent's funds.
requested amendment also alters Michael's allegations
regarding the retitling of the Property. The redline
comparing Michael's proposed amended complaint to the
original complaint highlights this change:
5. In spite of the fact that they had been divorced for many
years and that Mr. DeGroat specifically excluded Lucinda from
any inheritance, upon information and belief, Lucinda
influenced Mr. DeGroat into executing a new deed to his
home on January 29, 2013 and also executing a Power of
Attorney naming Lucinda as Agent on December 2,
2013. … .
11. Mr. DeGroat refused to voluntarily retitle or transfer
any of his assets to Lucinda. He did not voluntarily
allow her to change his accounts and policies to name herself
as the primary beneficiary. He did
allow her to retitle the ownership of the Property as a joint
tenancy, but He did not allow her to take 100% of the
proceeds when the home the
Property at 3 Somerset Lane was sold.
opposing Michael's motion to amend, Lucinda contends
Michael's attempt to add Jan and Carroll as plaintiffs is
designed to rescue his case from dismissal due to lack of
standing, under the theory that none of the disputed assets
ever belonged to Michael or the estate. Lucinda asserts
neither Jan nor Carroll has any knowledge of the allegations
in the proposed amended complaint. Lucinda also claims the
proposed amendments are futile, on two grounds: the
amendments do not repair Michael's lack of standing, and
the allegations of undue influence are insufficient to state
a claim and are disproven by the evidence. Lucinda also
argues the proposed amendments are prejudicial because they
withdraw Michael's concession in the original complaint
that Decedent allowed Lucinda to retitle the Property as a
joint tenancy. Finally, Lucinda claims the proposed
amendments are untimely. Lucinda does not explicitly oppose
adding Ziatyk as a defendant.
of Chancery Rule 15(a) provides that leave to amend a
pleading shall be freely given when justice so requires.
This determination is a matter of the court's discretion.
Rule 15(a) reflects the modern philosophy that cases are to
be tried on their merits, not on the pleadings. Therefore,
courts generally will not test the sufficiency of the
pleadings in ruling on a motion to amend. A motion to amend
may be denied, however, if the amendment would be futile, in
the sense that the legal insufficiency of the amendment is
obvious on its face. In exercising its discretion, the court
also considers factors such as bad faith, undue delay,
dilatory motive, repeated failures to cure by prior
amendment, undue prejudice, and futility of
instructs me to evaluate pleadings on their face: a motion to
amend is not the time to test pleadings against evidence that
may have been collected during discovery. I therefore do not
consider Lucinda's arguments that she can disprove the
allegations of undue influence and incapacity, without
prejudice to Lucinda's ability to renew these arguments
in a dispositive motion or at trial.
question remains whether the proposed amended complaint is
futile because of obvious legal insufficiency. The proposed
amended complaint alleges that in 2013, Lucinda influenced
Decedent into executing a new deed to the Property naming
Lucinda and Decedent as joint tenants with right of
survivorship, and also a power of attorney naming Lucinda as
agent. It also alleges Lucinda moved Decedent out of the
Property, sold it in 2014 by signing Decedent's name, and
kept all of the ...