Master in Chancery Dismissive of Fiduciary Seeking Dismissal, Applies Familiar 12(b)(6) Standard
By: Rich Minice and Annette Becker
In Hill et al. v. Myers et al., C.A. No. 2018-0160 (Del. Ch. June 15, 2020), Master in Chancery Selena Molina (“Master”) issued a final report, recommending the Court of Chancery deny defendant’s (decedent’s close friend and confident, and attorney-in-fact during his final years) motion to dismiss claims of undue influence and breach of fiduciary duty. The Master determined that the motion to dismiss brought by family members of the late G. Robert Dickerson, should be denied because the family members provided sufficient factual allegations to support their claims and establish standing.
In 2018, following G. Robert Dickerson’s death (“Decedent”), Jerita Hill, Tammera Ward and other family members (“Plaintiffs”) alleged that Judy Myers, attorney-in-fact for Decedent (“Defendant”), along with two other defendants, breached their fiduciary duty of loyalty to the Decedent to acquire the family farm (the “Property”), which was intended to be bequeathed to the Plaintiffs. Plaintiffs specifically alleged that before Decedent’s hospitalization, the non-moving defendant attempted to buy the property many times to no avail. After Decedent’s hospitalization, the Property was sold to the Defendant at a “fire sale price.” In response to Plaintiffs’ claims of breach of fiduciary duty and undue influence, Myers brought a motion to dismiss for failure to state a claim and lack of standing (the “Motion”). The other defendants are not party to the Motion.
Plaintiffs’ allegation that Defendant bought the Property at an unfair price, contrary to Decedent’s wishes, was sufficient to state a claim for breach of fiduciary duty because the sale allegedly benefitted Defendant against the Decedent’s interest and prior wishes. Since Plaintiffs were the intestate heirs of the Decedent’s estate and were the intended beneficiaries of the Property in the will, and because the Decedent had previously refused to sell the Property to the Defendant, the Master determined Plaintiffs had standing to pursue a claim.
In opposition to the Motion, Defendant conceded that she owed fiduciary duties to the Decedent but that she did not breach those duties. She contended that the sale of the Property was not the result of undue influence because there were a variety of reasons to sell the Property that would benefit the Decedent, including that the Defendant was no longer living there. The Master recommended that full discovery was necessary to resolve these factual disputes, and granting of the Motion at the pleading stage would be inappropriate.
Additionally, the Motion sought dismissal of Plaintiffs’ declaratory judgment claim seeking intestate succession for bequests not specifically called out in the will due to lack a residuary clause. However, the Master determined there was an ambiguous clause in the will that could have been intended to be a residuary clause and dismissal would be inappropriate at this time.
Finally, the Master recommended against Plaintiffs’ request for attorney’s fees related to responding the Motion, which Plaintiffs argued was “frivolous, ” because the Motion was “narrowly tailored” to only three of eight counts and presented arguments the Master determined to be in good faith.