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Branson v. Branson

Supreme Court of Delaware

January 14, 2019

VINCENT BRANSON and LEE MESTRE, Defendants Below, Appellants,
v.
DAVID BRANSON, ALBERT BRANSON, and ROBERT BRANSON, Plaintiffs Below, Appellees.

          Submitted: November 16, 2018

          Court Below-Court of Chancery of the State of Delaware C.A. No. 11504-VCG

          Before VALIHURA, SEITZ, and TRAYNOR, Justices.

          ORDER

          Gary F. Traynor, Justice.

         After consideration of the parties' briefs and the record on appeal, it appears to the Court that:

         (1) The pro se appellants, Vincent Branson and Lee Mestre, challenge a decision of the Court of Chancery quieting title to certain real property that includes a cottage, which is located in South Bethany Beach, Delaware. After careful review of the parties' briefs and the record on appeal, we affirm.

         (2) The appellant Vincent Branson and the appellees (collectively, the "Brothers" and, with their sister, who is not a party to this action, the "Siblings") are four of the five children of Dorothea Branson, who died in 2001. The appellant Lee Mestre is Vincent's[1] daughter. Ownership of the property at issue has been the subject of several protracted litigations between the parties in Delaware and Maryland. There have been allegations of bad faith and misconduct by both sides. Ultimately, though, the present appeal arises from an in rem action brought by the appellees to quiet title to the cottage.[2]

         Factual Background and the Prior Delaware Litigation

         (3) The factual background of this matter has been set forth more fully in decisions of the Court of Chancery in the prior litigations.[3] In brief, Dorothea and the Siblings' father divorced in 1969. The Siblings' father acquired the cottage in 1974 and later transferred ownership to the Siblings.[4] A series of transfers among the Siblings and Dorothea later occurred, but no deeds were executed or recorded; as a result of those transfers, by 1990, Dorothea owned 75% of the cottage and Albert owned 25%.[5]

         (4) Dorothea died in 2001. Her will left all of her estate, in equal shares, to the Siblings.[6] The Brothers' sister disclaimed her interest in the estate, and the estate was divided in equal shares among the four Brothers. Vincent took his share entirely in cash or stock; Albert, David, and Robert each received at least part of his share in the form of an ownership interest in the cottage. In September 2004, Vincent initiated an action in the Court of Chancery alleging that (i) Robert, Albert, and David had agreed to sell him the cottage and seeking specific performance of that agreement or, alternatively, damages for breach of contract, and (ii) he did not receive his full and final share of Dorothea's estate in cash or stock and he therefore inherited an interest in the cottage. After trial, the Court of Chancery found that there was no enforceable oral agreement for the sale of the cottage and that Vincent had received his full share of the estate in cash or stock and had no ownership interest in the cottage.[7] This Court affirmed on appeal.[8]

         (5) The property records continued to suggest that Vincent had an ownership interest in the cottage despite the Court of Chancery's 2010 ruling that he did not. Thus, in 2012, Albert, David, and Robert filed a separate action seeking to quiet title. They did not proceed in rem, however. For that reason, the Court of Chancery held that the title would be quieted only in personam with respect to Vincent.[9] On September 19, 2013, the Court of Chancery entered an order incorporating the 2010 ruling that Vincent had no interest in the cottage, granting summary judgment to quiet title against Vincent in personam, and ordering cancellation of a lis pendens filed by Vincent in January 2012. This Court affirmed on appeal.[10]

         The Maryland Litigation

         (6) In February 2014, Mestre brought an action against her uncle, David, and her father, Vincent, in the Circuit Court for Montgomery County, Maryland. In that action, Mestre alleged that she was a third-party beneficiary of a 1992 oral agreement between Dorothea and Albert, under which Albert would live in the cottage rent-free for his life and would maintain the cottage as a family vacation home, and the cottage would then pass to Dorothea's grandchildren upon Albert's death. On August 28, 2014, when David had not yet been served, the Maryland Court entered an order approving a partial settlement of the case, which dismissed one of the two counts of the complaint, as to Vincent only. The August 2014 Maryland Order incorporated a settlement agreement that created a Maryland trust, the 10 North Fourth Street Trust (the "Trust"), which purportedly was funded with Vincent's interest in the cottage. The Order further provided that Vincent would execute a quitclaim deed to Mestre as trustee of the Trust. Vincent executed a quitclaim deed that was dated October 8, 2014 and recorded with the Sussex County Recorder of Deeds on October 24, 2014. That deed from Vincent to Mestre clouded title to the property yet again, despite the Court of Chancery's rulings in 2010 and 2013 that Vincent had no interest in the property.

         (7) On December 4, 2014, the Maryland Court entered an order dismissing the action with prejudice with respect to Vincent (but not David). The December 2014 Maryland Order incorporated a settlement agreement that Mestre and Vincent had signed on or about November 13, 2014. That settlement agreement recited various "facts," including that Mestre was a third-party beneficiary of a 1992 agreement between Dorothea and Albert under which "Albert in exchange for rent-free use for life agreed to maintain the family vacation home for as long as he could for the benefit of the family and that at his death the home would pass to the grandchildren of Dorothea." In January 2015, Mestre voluntarily dismissed the action she had filed in 2014, in which David remained as the sole defendant; a few days later, Mestre filed a new, similar action in the same Court, with David as the sole defendant. Like the 2014 action, Mestre's 2015 complaint alleged that Mestre and Dorothea's other grandchildren were third-party beneficiaries of the purported 1992 agreement between Dorothea and Albert.

         (8) The Maryland Court held a three-day bench trial in June 2016. At the close of Mestre's case, David moved for judgment under Maryland Rule of Civil Procedure 2-519. The Court granted that motion, applying Delaware law and holding that Mestre had failed to prove the existence of the alleged 1992 agreement, and entered judgment for David.

         The Present Action

         (9) Because of clouds that remained on the title, including the 2014 quitclaim deed from Vincent to Mestre, on September 15, 2015, Albert, David, and Robert initiated this case in the Court of Chancery against Mestre and Vincent. The complaint asserted, among other causes of action, a claim for a declaratory judgment that there was no binding 1992 agreement between Dorothea and Albert and that neither Mestre nor Vincent nor the Trust had any interest in the cottage. In May 2016, the plaintiffs filed an amended complaint asserting an in rem quiet title action.

         (10) On or about September 7, 2017, following significant motion practice, the Court of Chancery issued a rule to show cause why the appellees' petition for quiet title should not be granted and set a hearing on the petition for October 13, 2017. The rule to show cause was issued to Mestre and Vincent, who had objected to the petition, and also provided for notice to any unknown defendants by publication and a posting on the property. Following the hearing on October 13, 2017, the Court issued a briefing schedule for all objections. After the scheduled briefing was complete, the Court scheduled a final hearing on the petition to quiet title for March 7, 2018; that hearing was later continued at Mestre's request because of inclement weather.

         (11) The Court of Chancery held the final hearing on the petition to quiet title on April 4, 2018. The Court found the ownership of the property to be as follows: Albert Branson, 46.40% tenant-in-common interest; Robert Branson, 31.87% tenant-in-common interest; and David Branson, 21.73% tenant-in-common interest. The Court found that Vincent, Mestre, and the Trust "hold no interest in the subject property as of the date of this Order." The Court ordered that the Sussex County Recorder of Deeds (i) record a copy of the Court's order in the Office of the Recorder of Deeds, "as conclusive evidence of said ownership," and (ii) remove from its records all documents recorded by "Vincent Branson, Lee Mestre, the 10 North Fourth Street Trust, and/or their representatives, creating an encumbrance on the title." Mestre and Vincent appeal from the Court's order.

         Issues Raised on Appeal

         The Characterization of the 2014 Maryland Litigation as ...


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