Krueger v. Foskey

• Decision Date: 26 September 2022
• Docket Number: C. A. 2021-0374-PWG
• Parties: Kelli Krueger, Plaintiff v. Roxanne C. T. Foskey and Edward J. Boiser a/k/a John Edward Banks, and The Estate of John S. Banks by and through its Administrator, Jacqueline Bartlebaugh, Defendants
• Court: Court of Chancery of Delaware

Kelli Krueger, Plaintiff v. Roxanne C. T. Foskey and Edward J. Boiser a/k/a John Edward Banks, and The Estate of John S. Banks by and through its Administrator, Jacqueline Bartlebaugh, Defendants

C. A. No. 2021-0374-PWG

Court of Chancery of Delaware

September 26, 2022

Submitted: June 6, 2022

Dean A. Campbell, Esquire

Paul G. Enterline, Esquire

David N. Rutt, Esquire

Moore & Rutt, P.A.

Harold W. T. Purnell, Esquire

Sergovic Carmean Weidman

Dear Counsel:

Pending before me is a motion to dismiss plaintiff's claim seeking to enforce her alleged oral agreement with her deceased stepfather that she would inherit half of his estate if she made mortgage payments to him and her mother on real property she purchased from them. I also consider plaintiff's motion to amend her complaint to add an additional claim of promissory/equitable estoppel. I recommend that the Court deny the decedent's son's motion to partially dismiss the complaint and grant plaintiff's motion to amend the complaint. This is a final report.

I. Background

Plaintiff Kelli Krueger ("Krueger") alleges that, in 2002 she entered into an oral agreement ("2002 Transaction") with her mother, Sibyl Banks ("Banks"), and her stepfather, John S. Banks ("Decedent"), in which she agreed to purchase real property in Pennsville, New Jersey ("Property") from them and make monthly payments on the $90,000.00 purchase money mortgage they held on the Property, and, in return, Banks and Decedent agreed to reimburse Krueger for the purchase price through his estate plan, which provided that Decedent would devise his estate equally to Krueger and Jacqueline Bartlebaugh ("Bartlebaugh"), Krueger's halfsister and the administrator of the Estate of John S. Banks ("Estate").^[1]

Krueger asserts that Decedent served as her "de facto father from 1981 until his death in 2020."^[2] She contends that, after Banks' death in July 2010, she saw Decedent's "multiple Wills," and had discussions with Decedent, to the effect that Decedent's estate would pass to Krueger and Bartlebaugh at his death.^[3] She also asserts that she and Decedent agreed that Decedent would continue to hold the mortgage on the Property, the mortgage would be fully satisfied at his death, and Decedent would not revoke his will devising one-half of his estate to Krueger.^[4] At some point following Banks' death, Decedent became romantically involved with Defendant Roxanne C.T. Foskey ("Foskey").^[5] Decedent died on November 3, 2020.^[6]

Bartlebaugh petitioned the Sussex County Register of Wills ("ROW") for letters of administration on January 4, 2021, and filed an affidavit stating that a diligent search had been made for a will from Decedent but that no will could be found on January 8, 2021.^[7] On January 11, 2021, the ROW granted letters of administration to Bartlebaugh.^[8]

On April 29, 2021, Kreuger filed the Complaint for Specific Performance of a Contract to Make a Will and Other Equitable Relief ("Complaint") against Defendants Foskey, Edward J. Boiser ("Boiser"),^[9] and the Estate, through Bartlebaugh, claiming breach of a contract to make a will ("Count I"), breach of fiduciary duty against Foskey ("Count II"), and replevin against Foskey to recover guns that allegedly belonged to Decedent ("Count III").^[10] Boiser filed his answer to the Complaint on June 11, 2021, seeking dismissal of Count I.^[11] On September 24, 2021, the Estate, through Bartlebaugh, filed an answer, taking no position on Count I, joining in Krueger's claims against Foskey in Counts II and III but seeking dismissal of those Counts against it, and a cross-claim ("Cross-claim") against Foskey asking the Court to void the transfer of the title of Decedent's pickup truck to Foskey in September 2020.^[12] On February 21, 2022, Foskey answered the Complaint and the Cross-claim, and filed a counterclaim ("Counterclaim") claiming trespass and conversion of Decedent's personal property against Krueger.^[13] Boiser responded to the Counterclaim seeking its dismissal,^[14] and Krueger answered the Counterclaim, denying its claims.^[15]

On March 21, 2022, Boiser filed a Motion to Partially Dismiss Pursuant to Rule 12(b)(6) ("MTPD"), arguing that Count I should be dismissed because the Complaint did not allege consideration to support a contract to make a will.^[16] In response, on May 2, 2022, Krueger filed a Motion to Amend Complaint ("MTA") and a proposed amended Complaint, which would add factual allegations about the 2002 Transaction and an alternative claim of promissory/equitable estoppel ("Count IV").^[17] Boiser responded on May 4, 2022, arguing that the MTPD should be granted and the MTA denied because Krueger had no right to inherit from Decedent, she has not shown consideration or detrimental reliance to support the alleged oral agreement to make a will, and this Court lacks subject matter jurisdiction over Krueger's claims.^[18] In her June 6, 2022 reply, Krueger argues that the factual allegations in the proposed amended Complaint are sufficient to create a pleadings- stage inference of an enforceable contract and, alternatively, detrimental reliance and estoppel, and that this Court has subject matter jurisdiction over this matter.^[19]

II. Analysis

A. Krueger has adequately pled a contract claim.

Under Count I, Krueger seeks specific performance of the 2002 Transaction in which Decedent agreed to make a will (or establish an estate plan) devising one-half of his estate to Krueger, in return for her making monthly mortgage payments on the Property.^[20] Boiser moves to dismiss Count I for failure to state a claim upon which relief can be granted, arguing that the Complaint does not allege separate consideration for the promise to reimburse Krueger for the purchase price or to devise one-half of his estate to her, which was only a promise to make a gift.^[21]

"Delaware has a strong public policy that favors permitting a litigant a right to a day in court."^[22] On a motion to dismiss under Rule 12(b)(6) for failure to state claim upon which relief can be granted, the Court accepts all well pleaded factual allegations as true, with even vague allegations considered as "well pleaded" if they give the opposing party notice of the claim.^[23] All reasonable inferences are drawn in favor of the non-moving party, and the Court should "deny the motion unless the plaintiff could not recover under any reasonably conceivable set of circumstances susceptible of proof."^[24] Even though "it may, as a factual matter, ultimately prove impossible for the plaintiff to prove his claims at a later stage of a proceeding, ... that is not the test to survive a motion to dismiss."^[25]

The issue is whether Krueger has pled any reasonably conceivable set of circumstances through which it can be proven that she had an oral contract with Decedent to make a will bequeathing her one-half of his estate. "Delaware case law recognizes the validity of contracts to make a will."^[26] Although "[g]enerally, under . . . Delaware's Statute of Frauds, oral promises to make a will are unenforceable,"^[27] it is "well-settled that [a] court may enforce a partly performed oral contract [to make a will] upon proof of clear and convincing evidence of actual part performance."^[28]"Delaware recognizes the validity and enforceability of an oral contract to make a will, [but] the law views those agreements with skepticism."^[29] The party alleging the oral contract to make a will must "prove that it actually performed under the contract in reliance on a quid pro quo arrangement and that not enforcing the arrangement would be inequitable."^[30] "At the pleading stage, the party seeking enforcement of an oral agreement to make a will must plead sufficient facts supporting a reasonably conceivable claim that (1) the oral agreement existed (there was an offer, acceptance, and consideration), (2) the material terms are definite and certain, (3) the Plaintiff partially performed in reliance on the agreement, and (4) that it would be inequitable not to enforce the agreement."^[31] I find that Krueger has pled facts supporting each element. She pled that she contracted with Decedent and Banks in 2002 to purchase the Property and make mortgage payments on it if she would be reimbursed for the purchase price through Decedent's devising one-half of his estate to her.^[32] She claims that the transaction was established to provide income to Banks and Decedent.^[33] She performed by making mortgage payments to Decedent and Banks.^[34] She further alleges that the Decedent failed to maintain his part of the agreement.^[35]

Applying Delaware's notice pleading standard and drawing all reasonable inferences in favor of Krueger, I find the terms of the 2002 Transaction, although not pled with particularity, are sufficient to give adequate notice to state a claim for an alleged oral agreement.^[36] Boiser argues that the consideration given by Krueger - the mortgage payments - was not sufficient since it equals the value of the Property Krueger purchased and separate consideration is needed for the provision that Decedent make a will benefiting Krueger.^[37] "To make a contract, some consideration must flow to the offeror."^[38]

Consideration requires that each party to a contract convey a benefit or incur a legal detriment, such that the exchange is bargained for. If this requirement is met, there is no additional requirement of equivalence in the values exchanged because we limit our inquiry into consideration to its existence and not whether it is fair or adequate.^[39]

Boiser's argument focuses on the fact that Krueger received the Property in exchange for the mortgage payments so the consideration she gave was not sufficient to encompass the alleged oral contract for Decedent...