Cummings v. Estate of Lewis

• Decision Date: 14 March 2013
• Docket Number: C.A. No. 6948-VCP
• Parties: LOUISE CUMMINGS, individually and on behalf of her minor child, Plaintiff, v. THE ESTATE OF RONALD E. LEWIS, ROBERT L. JOHNSON, co-executor of the Estate of Ronald E. Lewis, LEONARD L. WILLIAMS, co-executor of the Estate of Ronald E. Lewis, MARGARET LEWIS, RONALD E. LEWIS, JR., BRANDON LEWIS, and KEVIN MOSLEY, Defendants.
• Court: Court of Chancery of Delaware

LOUISE CUMMINGS, individually and on behalf of her minor child, Plaintiff,

v. THE ESTATE OF RONALD E. LEWIS,ROBERT L. JOHNSON, co-executor of the Estate of Ronald E. Lewis,LEONARD L. WILLIAMS, co-executor of the Estate of Ronald E. Lewis, MARGARET LEWIS,RONALD E. LEWIS, JR., BRANDON LEWIS, and KEVIN MOSLEY, Defendants.

C.A. No. 6948-VCP

COURT OF CHANCERY OF THE STATE OF DELAWARE

Submitted: November 1, 2012

Decided: March 14, 2013

MEMORANDUM OPINION

Michael A. Weidinger, Esq., Joanne P. Pinckney, Esq., Kevin M. Capuzzi, Esq., PINCKNEY, HARRIS & WEIDINGER, LLC, Wilmington, Delaware; Attorneys for Plaintiff Louise Cummings, individually and on behalf of her minor child.

C. Malcolm Cochran, IV, Esq., W. Donald Sparks, II, Esq., Todd Coomes, Esq., Travis S. Hunter, Esq., RICHARDS, LAYTON & FINGER P.A., Wilmington, Delaware; Attorneys for Defendants The Estate of Ronald E. Lewis and Robert L. Johnson.

PARSONS, Vice Chancellor.

The plaintiff in this case seeks an award against the estate of her daughter's father under Delaware's after-born child statute, 12 Del. C. § 301. The plaintiff also seeks enforcement of a severance agreement. After bringing this suit against the estate, the plaintiff also commenced litigation in a New Jersey court and the Delaware Family Court seeking, in both cases, an award of child support against the estate. After learning of the child support claims, the defendants in this case, including the estate, moved for leave to amend their answer to include a request for several instructions on the relationship between the plaintiff's child support claims and her claim to recover an intestate share under Delaware's after-born statute. In addition, the defendants seek to add an affirmative defense to the plaintiff's claim for enforcement of the severance agreement. The plaintiff opposes the defendants' motion for leave to amend.

After considering the parties' briefing on the defendants' motion, I grant the motion in part and deny it in part.

I. BACKGROUND

A. The Parties

Ronald E. "Butch" Lewis died testate on July 23, 2011.¹ Lewis was the founder, president, and CEO of Butch Lewis Productions, Inc. ("BLP"), a New York corporation.Lewis was a well-known boxing promoter and manager, film and music producer, and philanthropist.

Plaintiff, Louise Cummings, was involved romantically with Lewis between October 2006 and Lewis's death on July 23, 2011. Cummings worked for BLP. A.L. is the daughter of Cummings and Lewis, but neither Cummings nor Lewis knew Cummings was pregnant before Lewis died.² A.L. was born on April 15, 2012.

Defendant Estate of Ronald E. Lewis (the "Estate") was created as a result of Lewis's death. Defendants Robert L. Johnson and Leonard L. Williams³ are co-executors of the Estate pursuant to Article III of the Last Will and Testament of Ronald E. Lewis dated April 26, 1999 (the "Will"). Defendants Margaret Lewis, Ronald E. Lewis, Jr., Brandon Lewis, and Kevin Mosley are Lewis's adult children.

B. Facts

1. The after-born and child support claims

At the time of his death, Lewis resided in Delaware.⁴ Lewis recognized four children in the Will: Margaret, Ronald, Jr., Brandon, and Kevin.⁵ On October 19, 2011, Cummings instituted this action seeking to establish Lewis as A.L.'s father and to recoverthe equivalent of an intestate share of the Estate under 12 Del. C. §§ 301 and 310 ("Section 301" or the "After-Born Statute"). On June 26, 2012, to ascertain whether Lewis is A.L.'s father, I ordered genetic testing according to a proper testing protocol.⁶ On September 17, 2012, after DNA tests had proved that Lewis is A.L.'s father, I entered an Order to that effect.⁷

On August 23, three days after receiving the DNA results, Cummings filed a statement of claim for child support with the New Castle County Registry of Wills (the "Statement of Claim") to preserve that claim against the Estate.⁸ Five days later, on August 28, 2012, the Estate filed a Motion for Leave to File an Amended Answer and Verified Counterclaim for Instructions (the "Motion to Amend").⁹ On August 29, 2012, Cummings brought suit in the New Jersey Superior Court seeking child support for A.L.¹⁰ On October 4, 2012, pursuant to her Statement of Claim, Cummings also filed a Petition for Support in the Delaware Family Court.¹¹ Both child support claims are pending.

2. The Severance Agreement

Before his death, Lewis owned BLP. Cummings alleges that she was the Vice-President of Operations for BLP until its business activities were wound up following Lewis's death.¹² Approximately two months after Lewis died, Cummings and Defendant Johnson, as co-executor of the Estate, entered a Severance Agreement (the "Severance Agreement" or the "Agreement") wherein BLP agreed to pay Cummings two weeks of severance pay for each year she worked for BLP.¹³ According to the Agreement, Cummings worked for BLP for five years, and therefore was entitled to receive $16,161.25 in severance pay after taxes.¹⁴ As part of the Agreement, Cummings released any claims she had against BLP.¹⁵

On May 9, 2012, Cummings amended her Complaint to add claims against the Estate for breach of the Agreement and fraudulent transfer.¹⁶ It is undisputed that Cummings has not received the money allegedly owed to her under the Agreement. The Estate claims, however, that Cummings was employed by BLP for less than one yearbefore Lewis's death, and that she materially misrepresented her length of employment at BLP in order to receive more severance pay.¹⁷ On that basis, the Estate maintains that the Severance Agreement is void or voidable.¹⁸

C. Procedural History

Although Cummings commenced this action on October 19, 2011, she filed an Amended Complaint on May 8, 2012 (the "Complaint"). Defendants filed their Answer to the Complaint on July 3, 2012. On August 23, 2012, Cummings filed her Statement of Claim for child support against the Estate. In response, Defendants filed their Motion to Amend on August 28, 2012 to request instructions regarding the relationship between Cummings's claim under the After-Born Statute and her claim for child support, and to assert certain defenses against Cummings's claims for child support and for enforcement of the Severance Agreement. Defendants also have filed a cross motion for partial summary judgment (the "Motion for Summary Judgment"), seeking summary judgment on the instructions requested in their Motion to Amend.¹⁹ This Memorandum Opinion constitutes my rulings on Defendants' Motion to Amend.

D. Parties' Contentions

In the proposed amendment to the Answer, Defendants seek instructions from this Court as to eight questions (the "Requested Instructions" or "Instructions"): (1) whether Cummings's claims for child support were filed timely under 12 Del. C. § 2102; (2) whether Delaware or New Jersey law governs the child support claims; (3) whether the claims for child support are valid under the facts and circumstances of this case; (4) whether, if Cummings prevails on a claim for child support, she also can recover under 12 Del. C. § 301; (5) whether, if Cummings prevails on a claim for child support, that claim would offset, or be offset by, a valid claim under Section 301; (6) whether Cummings must elect one remedy, either child support or Section 301 recovery; (7) whether any amount recovered by Cummings, either as child support or under Section 301, should be classified as payments to creditors or beneficial interests of the Estate; and (8) whether the Severance Agreement is enforceable.²⁰ Defendants contend that expeditious resolution of these questions is necessary to the prompt and correct distribution of the Estate's assets. Finally, Defendants seek to add an affirmative defense that Cummings's claims for damages based on the Estate's alleged breach of the Severance Agreement is time-barred under 12 Del. C. § 2102(b) (the "Affirmative Defense").²¹

Cummings opposes Defendants' Motion to Amend. Cummings argues first that this Court lacks subject matter jurisdiction to give the Requested Instructions. In addition, Cummings contends that the Requested Instructions seek advisory opinions, which this Court cannot give. Finally, Cummings seeks denial of Defendants' motion to add the Affirmative Defense to Cummings's claim for breach of the Agreement on the ground that Defendants unduly delayed in asserting that defense. In the Analysis below, I address each of those arguments in turn.

II. ANALYSIS

A. Standard for Motion for Leave to Amend

Court of Chancery Rule 15 governs motions for leave to amend. Rule 15(a) permits a party to amend its pleading "once as a matter of course at any time before a responsive pleading is served or, if the pleading is one to which no responsive pleading is permitted and the action has not been set for trial, the party may so amend it any time within 20 days after it is served."²² After this period, a party may amend its pleading "only by leave of Court or by written consent of the adverse party; and leave shall be freely given when justice so requires."²³ Courts generally allow for liberal amendment in the interest of resolving cases on the merits.²⁴ "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."²⁵ That is, the motion should be denied if the proposed amendment would immediately fall to a motion to dismiss.²⁶ Moreover, leave to amend should be denied if there is a showing of substantial prejudice, bad faith, dilatory motive, or repeated failures to cure by prior amendment.²⁷ Ultimately, the decision to grant or deny a motion for leave to amend is left to the sound discretion of the trial court.²⁸

B. Does this Court Have Subject Matter Jurisdiction over the RequestedInstructions?

The Court of Chancery is a court of limited jurisdiction. It can acquire subject matter jurisdiction over a case in three ways: "(1) the invocation of an equitable right; (2) a request for an equitable...