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IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

Margaret C. Ughetta, )

Petitioner ) C.A. No. 7885-MA

)

v. )

)

Mary Harding Cist, individually, as )

Executrix of the Estate of John David )

Cist, and as Trustee of the Supplemental )

Trust Agreement of John David Cist, )

Respondent )

MASTER’S REPORT

Date Submitted: January 7, 2015

Draft Report: 

Final Report: May 29, 2015

One of four beneficiaries of a now-irrevocable trust contends that the 

successor trustee should be removed for alleged breaches of fiduciary duty. The 

successor trustee denies these claims and, in turn, seeks to forfeit 50 percent of this

beneficiary’s trust share under the no-contest provision of the trust agreement.

The four beneficiaries, one of whom is the successor trustee, are the 

surviving children of a married couple, each of whom settled a trust for the benefit 

of themselves and their children. The beneficiaries’ mother predeceased their 

father, and upon the father’s death two years later, his successor trustee was 

directed by the provisions of the father’s trust agreement to equalize the couple’s

lifetime and post-mortem gifts to their four children. Petitioner has questioned the 
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successor trustee’s administration of the father’s trust. In 2011, after the 

beneficiaries all participated in a distribution the trust’s tangible personal property 

(hereinafter “TPP”), petitioner refused to sign a receipt and release agreement. As 

a result, her TPP remains in storage controlled by the father’s trust while her three 

siblings have taken possession of their TPP. Likewise, petitioner is dissatisfied 

with the process undertaken to equalize the beneficiaries’ shares of their parents’ 

lifetime and post-mortem gifts. Petitioner now contends that the equalization 

process was inconsistent with the terms of the father’s trust agreement. 

For the reasons that follow, I conclude that the successor trustee properly 

exercised her discretion in distributing the TPP and in following the equalization 

process established originally by the trustor during his lifetime. However, I also 

conclude that the beneficiary has not challenged the disposition or validity of the 

trust, but instead sought only to ensure its proper administration. As a result, she 

has not triggered the no-contest provision of the trust agreement. In order not to 

prolong this litigation, I am waiving a draft report and issuing this as my final 

report. 

I. FACTUAL BACKGROUND

The trustor, John David Cist (hereinafter “Mr. Cist”) and his wife Mary S. 

Cist (hereinafter “Mrs. Cist”) were the parents of four children: Dorothea Cist, 

Margaret C. Ughetta, David Cist, and Mary Harding Cist. During their lifetimes, 
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Mr. and Mrs. Cist were financially comfortable as a result of their own investments 

and family inheritances.1 They accumulated possessions, including family 

heirlooms, and were reluctant to dispose of anything. At the same time, however, 

Mr. and Mrs. Cist were generous parents. They provided each of their children

with a private college education and a credit card on the parents’ account, and also 

paid some of the private school tuition of their grandchildren, among other gifts. 

Dorothea and Mary Harding apparently never married and have no children.

2

 

Margaret and her husband have four children who were in high school and college 

when Margaret filed her petition for an accounting and to remove Mary Harding as 

successor trustee. David and his wife have two younger children. 

On May 21, 1991, Mr. and Mrs. Cist executed wills3and entered into trust 

agreements in their respective capacities as trustor of his and her own trust and as 

co-trustees of both trusts.

4

 The provisions of Mr. Cist’s trust agreement included 

the division of the trust fund upon his death, if his wife survived him, into a 

Unified Credit Generation Skipping Transfer (“GST”) Trust, a Marital GST Trust, 

a Marital Trust and, possibly, a Resulting Trust. On June 30, 1993, Mr. Cist 

 

1 Respondent Mary Harding Cist’s Single Compilation of Appendices (hereinafter 

“Mary Harding Compilation”) at 2 (Affidavit of Mary Harding Cist).

2

I use first names here for the sake of clarity, and intend no disrespect.

3 Mary Harding Compilation at 130-156 (Wills of John David Cist and Mary S. 

Cist).

4

Id. at 10-54 (Trust Agreement between John David Cist, Trustor and John David 

Cist and Mary S. Cist, Trustees). 
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executed a Supplemental Trust Agreement, in which he modified two sections that 

are not relevant here.

5

 Mrs. Cist’s trust agreement and supplemental trust 

agreement contained reciprocal provisions for the benefit of her husband, and 

identical provisions for her children.

6

 

A. Fairness Concerns

In 2006, David became aware that Margaret was receiving from her parents

more gifts of family heirlooms than her siblings.7 In a letter to his parents, David 

expressed his concern that jewelry, silverware, china, paintings, and furnishings 

“were leaking away” “by gift or eminent domain,” giving rise to the appearance of 

favoritism.8 In his letter, David stated that he was not concerned about monetary 

matters because he predicted that his parents’ assets after taxes could be equalized 

without much difficulty despite the large sums of money or assets that already had 

been given to their four children.9 However, David implored his parents to be fair 

 

5

Id. at 55-62 (Supplemental Trust Agreement between John David Cist, Trustor 

and John David Cist and Mary S. Cist, Trustee). 

6

Id. at 175 (Supplemental Trust Agreement between Mary S. Cist, Trustor, and 

Mary S. Cist and John David Cist, Trustees Dated December 20, 2006). Although 

the record does not include Mrs. Cist’s pre-2006 trust documents, the similarity of 

the couple’s 2006 Supplemental Trust Agreements and the coordinated history of 

their estate planning leads me to believe this was the case. 

7

Id. at 425 (Deposition of David B. Cist). 

8

Id. at 502-503 (letter from David dated about October 2008).

9

Id. at 502. The large blocks to which David was referring in his letter were gifts 

of a house to David, a house to Mary Harding, financial assistance to Dorothea, 

and tuition payments for Margaret’s children. 
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to the rest of their children when it came to the distribution of “historically 

important family artifacts.”10

David’s letter may have prompted Mr. and Mrs. Cist to reconsider their 

estate plans because on December 20, 2006, Mr. Cist executed another 

Supplemental Trust Agreement, in which he modified his previous trust agreement 

by restating it completely.11 Mr. Cist’s 2006 Supplemental Trust Agreement 

provided for the distribution of the trust fund, upon Mr. Cist’s death, into: (1) a 

Generation-Skipping Transfer Tax Exemption Trust (hereinafter “GST”); (2) a 

Marital Trust in the event that Mrs. Cist survived her husband; and (3) a Residuary 

Trust. The provisions of the Marital Trust were complex and allowed Mrs. Cist to 

occupy the family residence in Wilmington, Delaware, for the rest of her life and, 

upon Mrs. Cist’s death, provided for the transfer of this residence to Mary Harding, 

outright and free from trust.12 The remaining Marital Trust was to be divided in 

equal shares for his children, with the following provisos: (1) the amount of 

 

10 Id. at 503. 

11 Id. at 63-116 (Supplemental Trust Agreement between John David Cist, Trustor, 

and John David Cist and Mary S. Cist, Trustees dated December 20, 2006). Mr. 

Cist also executed a new will on December 20, 2006, a first codicil to that will on 

July 17, 2009, and a second codicil to that will on January 6, 2010. Id. at 157-161. 

The codicil provisions are similar to the amendments to the Supplemental Trust

Agreement, i.e., Mary Harding was named executor of Mr. Cist’s estate, a nocontest provision was added to the will, and a provision concerning the TPP was 

added to the will. Since most of Mr. Cist’s property was held by the Trust, 

including the TPP, id. at 129 (Transfer of Tangible Personal Property, dated 

January 6, 2010), I will refer solely to the Trust throughout this discussion. 
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$250,000 was to be treated as an advancement to Dorothea to reduce the value of 

the share set aside for her and to increase correspondingly the shares set aside for 

the other children of Mr. Cist; (2) the amount of $1,250,000 was to be treated as an 

advancement to David as above; and (3) if Mary Harding received the Wilmington

residence, then the amount of $900,000 was to be treated as an advancement to 

Mary Harding as above.13 On December 20, 2006, Mrs. Cist executed a reciprocal

2006 Supplemental Trust Agreement, giving her husband the right to occupy the 

Wilmington residence for the rest of his life, and upon his death, for that residence

to be transferred to Mary Harding outright and free of trust, with the same

provisions regarding monetary reductions for advancements made to Dorothea, 

David, and Mary Harding.14 Only Margaret’s shares of Mr. and Mrs. Cist’s trusts 

were not subject to any reduction. 

Mrs. Cist passed away on February 10, 2008.15 In August 2008, while Mrs. 

Cist’s estate and trust were being administered, Mr. Cist sought the assistance of a 

different law firm to help him address the issue of prior gifts that had been made to 

 

12 Id. at 79, 83.

13 Id. at 83-85. Section II, Paragraph B (2)(m)(4) of Mr. Cist’s 2006 Supplemental 

Trust Agreement directed the Trustee to reduce these amounts to take into account 

any other amounts to be treated as advancements for each child in his wife’s trust. 

Id. at 85. 

14 Id. at 172-226. 

15 Id. at 1 (Affidavit of Mary Harding Cist).. 
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his children, and achieve his goal of treating his children equally and fairly.16 

Mary Harding made the initial phone call,17 and Dorothea accompanied her father 

to the office of Joanna Reiver, Esquire. During the course of this representation, 

Mr. Cist authorized Reiver and her associate, P. Kristen Bennett, Esquire, to speak 

with Mary Harding, Dorothea, or David at different times, but never with 

Margaret.18 In January 2009, after reviewing: (1) the most recent numbers for

cumulative transfers/gifts made prior to Mrs. Cist’s death, which had been 

prepared by Mr. Cist, Mary Harding and David; (2) Mr. Cist’s December 2008

transfers for tuition and equalizing gifts totaling more than $900,000; and (3) draft 

Form 706 for Mrs. Cist’s trust, Reiver recommended that Mr. Cist make equalizing 

distributions to his children “via lifetimes gifts to trusts” that Mr. Cist would 

establish for each of his children.19 At this time, some of Mr. Cist’s children and 

his attorneys were concerned that Mr. Cist’s continued gift-giving and transfers

were depleting his estate and would make equalization impossible unless Mr. Cist 

made a complete distribution of his estate during his lifetime.20 In July 2009, Mr. 

Cist authorized Reiver to prepare an irrevocable GST trust for each of his children. 

However, the issue of funding these trusts was very complex, given the character

 

16 Id. at 472 (Deposition of Joanna Reiver, Esq.). 

17 Id. at 471-472. 

18 Id. at 473. 

19 Id. at 440-442 (Letter dated January 21, 2009, from Reiver to Mr. Cist). 

20 Id. at 443 (email from P. Kristen Bennett, Esq. to Reiver dated July 20, 2009).
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of some of the assets and in light of expected changes in the federal transfer tax 

regime.

21 Because of the uncertainty of the tax law and the exact amount of assets 

needed for each trust, Reiver recommended that Mr. Cist wait until September 

2010 to proceed with the funding.

22

 Although the four documents were signed by 

Mr. Cist,23 the irrevocable GST trusts were never funded because Mr. Cist 

unexpectedly died on June 24, 2010, at the age of 90 years.

24

B. Amendments to Mr. Cist’s Trust

On July 19, 2009, Mr. Cist executed a First Amendment to 2006 

Supplemental Trust Agreement of John David Cist,

25 which was intended by 

 

21 Id. at 443-444. 

22 Id. at 488 (Reiver Deposition).

23 Mr. Cist, accompanied by one or more children, was expected to sign documents 

drafted by his attorney on January 4, 2010, but the family questioned whether the 

gifts should be made in 2009 or 2010. Anticipating a lower gift tax rate in 2010, 

the attorneys were inclined for the GST transfers to occur in 2010. Moreover, they 

had just received revised figures from David reflecting what he described as “the 

tally of cash and liquid assets transferred to each child as far back as we have 

records.” The “big change,” as David put it, was due to his “request to Dad that he 

allow the Cape Cod property to be assessed at its present value, rather than at its 

date of gift value.” Id. at 483-484. (Exhibit Reiver 10 – E-mail correspondence

beginning December 29, 2009 from David to Reiver and ending December 30, 

2009 from Reiver to Bennett). 

24 Id. at 465 (Deposition of P. Kristen Bennett, Esq.).

25 Id. at 117-124. (First Amendment to Supplemental Trust Agreement of John 

David Cist).
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Reiver as a “stopgap” measure pending an entire trust restatement.26 The 

background for this instrument was stated in Paragraph D of the First Amendment:

D. This amendment is intended to express my goal that, insofar 

as possible, the combined estates of my late wife, Mary S. Cist, and me 

shall be divided into equal shares – one share for each child of ours 

living at the time of my death, and one share for each child of ours 

deceased at such time but with issue then surviving. For the purposes 

of this division:

1. The trustee shall add to the value of my wife’s and 

my combined estates the cumulative value of transfers to our children 

(including transfers to, or for the benefit of, issue of a child as transfers 

to that child, and including payments made on behalf of a child or issue 

even if such payments were not deemed transfers under IRC Section 

2503(e) for gift tax purposes) made by my wife and/or made by me 

during our lifetimes, as well as made upon death pursuant to my wife’s 

will and/or trust and/or pursuant to my will and/or trust, as well as by 

beneficiary designation. These gifts shall be included at their date-ofgift (i.e., transfer) values.

2. After calculating the aggregate amount to which each 

child (or issue of a child) has received and is entitled to receive from all 

sources as provided above, the trustee shall modify (i.e., reduce or 

increase) the shares for my children (or issue of a child) under this 

Agreement as necessary so that the aggregate amount received by such 

child (or issue of a child) from all such sources is equal to the 

aggregate amounts received by each other child (or issue of a child) of 

mine from all such sources.

 3. Such equal shares shall be further modified (i.e., 

reduced or increased) if required pursuant to the No-Contest Provision 

included below.

4. Although I intend to amend this Agreement by 

complete restatement to provide detailed instructions for such 

equalizing distributions, I execute this interim amendment to my 

Agreement to express my intent, and I direct that my trustee take all 

 

26 Id. at 438-439 (email from Reiver to Reiver dated November 18, 2008); Id. at 

443-444 (email from Bennett to Reiver dated July 20, 2009); Id. at 464 (Bennett 

Deposition).
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necessary steps upon my death to distribute my estate and trust to 

achieve my intent as nearly as possible.27 

 Mr. Cist then modified his 2006 Supplemental Trust Agreement, first by 

modifying Section II, Paragraph B by deleting it in its entirety and substituting a 

new Paragraph B-3, as follows in pertinent part:

3. Residuary Trust.

Trustee shall hold and administer all of the remainder of the trust 

fund that is not disposed of by the previous provisions of this 

Agreement (hereinafter referred to as the “Residuary Trust”) in 

accordance with the provisions of this Paragraph 3 of this 

Subsection B.

(a) The trustee shall distribute the trust’s entire interest in [the 

Wilmington residence] to Trustor’s daughter, Mary Harding 

Cist .... Such distribution shall be added to such child’s trust 

share as provided in subparagraph (b) and described in 

subparagraph (c) below, as an addition to such child’s trust 

share.

(b) After the distribution provided in the preceding 

subparagraph, the trustee shall then divided the thenremaining amount of principal into shares for the benefit of 

each child of mine who survives me, ..., to effectuate my 

intent as described in Paragraph D of this First Amendment to 

Supplemental Trust Agreement, above. .....

28

Mr. Cist’s second modification was to add a new Paragraph C to Section II, 

as follows:

C- No-Contest Provision

 

27 Id. at 117-118.

28 Id. at 118.
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If any beneficiary under this instrument files an action in any 

court seeking to set aside any aspect of the document, or to 

challenge any aspect of the disposition provided herein, the 

bequest to such beneficiary shall be partially ineffective and void, 

and the bequest such beneficiary would have received, but for such 

challenge, shall be reduced by one-half (i.e., fifty percent). The 

contestant’s share shall also bear the costs of attorneys’ fees and 

costs incurred by the contestant as well as attorneys’ fees and costs 

incurred by my fiduciaries in defending the action. The portion by 

which such contesting beneficiary’s bequest is reduced shall be 

distributed in equal shares to the non-contesting beneficiaries. The 

provisions of this provision shall also apply to specific takers in 

default, if any provided in such bequest hereunder. This provision 

shall apply in the case of challenges based on fraud, mistake, 

undue influence, or incapacity, or upon any other basis.29

A third modification, not relevant here, was followed by a fourth modification 

appointing Mary Harding as successor trustee in the event of Mr. Cist’s incapacity 

or death and, if Mary Harding was unable to serve, then David was to be appointed 

in her stead.

On January 6, 2010, Mr. Cist modified his 2006 Supplement Trust 

Agreement a second time. The Second Amendment to Supplement Trust 

Agreement of John David Cist included Paragraph D, subsections 1 through 3 as 

recited above, but changed subsection 4 to state:

 4. I intend to make substantial equalizing transfers during my 

lifetime after the execution of this supplemental trust agreement. 

Such lifetime equalizing transfers reflect my intent to devise my 

one-half interest in the [Wilmington residence] to my daughter 

Mary Harding Cist upon my death, by reducing my lifetime 

transfers to such daughter. The trustee shall take such transfers 

 

29 Id. at 121.
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into account in making distribution hereunder to achieve my intent 

as nearly as possible, so that if such equalizing transfers were 

completed during my lifetime, upon my death my one-half interest 

in the [Wilmington residence] will be distributed to Mary Harding 

Cist, and the balance of my remaining estate and trust assets shall 

be divided equally among my children, .... 30

Mr. Cist further modified his trust by adding a new Paragraph B-1 as follows:

B-1: Tangible Personal Property:

After my death, tangible personal property coming into the 

hands of the trustee shall be distributed as follows:

A. I anticipate that I may leave with my personal papers a 

memorandum expressing my desires concerning the 

disposition of certain items of tangible personal property. 

To the extent such memoranda are inconsistent, the last 

dated such memorandum shall control.

B. To the extent not disposed of by memorandum, I give all of 

my tangible personal property, together with all policies of 

insurance on that property, to those of my children who 

survive me, in equal (or as nearly equal as possible) shares. 

If my children are unable to agree upon a method of 

distribution among themselves, distribution will be by 

alternating selection in an order to be determined by the 

drawing of lots.

C. If the provisions regarding disposition of such property 

under this trust conflict with the disposition of such property 

under my will, the provisions of this trust shall determine the 

disposition of such property.

D. The cost of delivering tangible personal property to the 

residences of the beneficiaries shall be paid from my estate 

or trust as my executor determines to be appropriate in the 

circumstances, as an expense of administration.31

 

30 Id. at 126. (Second Amendment to Supplemental Trust Agreement of John David 

Cist).

31 Id. 
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During the process of revising his own estate and trust plans, Mr. Cist was 

assisted primarily by David, whom Mr. Cist had asked to help calculate the gifts 

that had been given to each child over the years.32 David also worked with his 

father’s attorneys and Victor Pelillo,33a certified public accountant who had been 

hired by Mr. Cist and David in October 2009 to review the list of gifts to the 

various children and grandchildren that they had compiled in connection with 

establishing irrevocable GST trusts for Mr. Cist’s children.

34

 When Pelillo 

questioned whether certain of the reported items should be counted as gifts, David 

responded directly to Pelillo after consulting with Mr. Cist.35 David gave a 

preliminary report of the allocations to Mary Harding.36 He gave Margaret and 

Dorothea copies of their preliminary tallies, and discussed Margaret’s tally with 

her in person.37 

C. Trust Administration

Shortly after Mr. Cist passed away, Margaret, who had retained her own 

attorney, received copies of Mr. Cist’s recent supplemental trust agreements and 

 

32 Id. at 426-428 (Deposition of David B. Cist). 

33 Id. at 426.

34 Appendix to Petitioner Margaret C. Ughetta’s Answering Brief in Response to 

Respondent’s Motion for Summary Judgment (hereinafter “Ughetta’s Appendix”) 

at 136-137. Mary Harding Compilation at 288 (Affidavit of Victor Pelillo).

35 Mary Harding Compilation at 429 (David’s Deposition), 454-457 (letter dated 

October 22, 2009 from Pelillo to Mr. Cist and David); at 460 (email dated October 

25, 2009 from David to Pelillo).

36 Id. at 6 (Mary Harding Affidavit).
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codicils to his will.38 Margaret was surprised by the changes that had been made, 

and by the fact that Mary Harding was the sole executrix.39 In early August 2010, 

Margaret attended a meeting of the beneficiaries and was informed, among other 

things, that movers were waiting at the Wilmington residence for her to remove her 

personal items from this residence.

40

 Thereafter, during a conference call on 

August 24, 2010, the beneficiaries were invited to suggest ways of distributing the 

TPP.41 Margaret asked for an inventory of the TPP to be prepared, but Mary 

Harding decided against doing an inventory in light of the numerous items of 

TPP.42 During the summer of 2010 there was some discussion about setting a date 

for distributing the TPP, but Margaret’s attorney objected to setting an artificial 

deadline, and requested instead that any agreement on a method of distribution 

await the preparation of an appraisal of the TPP.43 It had been Mary Harding’s 

hope that the TPP selection would take place with all beneficiaries being present, 

but she abandoned this idea after she received a letter in March 2011 from another 

 

37 Id.

38 Id. at 422 (Deposition of Margaret C. Ughetta). 

39 Id. at 422-423. 

40 Id. at 423.

41 Ughetta’s Appendix at 105 (Mary Harding Deposition). 

42 Id. at 107-108 (Mary Harding Deposition).

43 Mary Harding Compilation at 546-548 (letter dated September 24, 2010, from 

Richard A. Popper, Esq. to Reiver).
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attorney recently retained by Margaret, who appeared to be threatening litigation.44 

Mary Harding subsequently hired Jeffrey Gibson, a paralegal for 30 years, who 

had experience in the distribution of several large estates with numerous items of 

TPP among multiple heirs,

45 as an independent overseer of the TPP distribution 

process. 

 D. TPP Distribution

Gibson suggested a process for selecting and distributing the TPP in the J. 

David Cist Estate and Trust, and worked collaboratively with Mary Harding to 

finalize the process.

46

 In a letter to the beneficiaries dated April 14, 2011, Gibson 

outlined the process whereby a week before the TPP division, the beneficiaries 

would have opportunities to visit the Wilmington residence and a few nearby 

storage facilities to view the TPP and add items to their selection list.47 Each 

viewing would be by appointment, each appointment would consist of a three-hour 

block of time, and each beneficiary could have a total of three appointments during

the six-day “viewing week.”48 After the viewing, each beneficiary was to create a 

list of items of TPP he or she wished to receive, and to rank these items in order of 

 

44 Ughetta Appendix at 108-109 (Mary Harding Deposition); at 260-261 (Letter 

dated March 15, 2011 from David J. Ferry, Jr., Esquire to Reiver).

45 Mary Harding Compilation at 272-273 (Affidavit of Jeffrey S. Gibson).

46 Ughetta Appendix at 127-128 (Deposition of Jeffrey S. Gibson).

47 Mary Harding Compilation at 277-281 (Letter dated April 14, 2011, from 

Gibson to four beneficiaries).
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preference. Each beneficiary was to submit his or her priority order list to Gibson 

by a certain date, and the lists would remain completely confidential.49 A selection

order was to be determined at random by picking the names of the four 

beneficiaries out of a hat. Then Gibson was to follow the selection rotation

(1,2,3,4/4,3,2,1/1,2,3,4) agreed upon by the beneficiaries in awarding items from 

their lists. If the item in that rank on a beneficiary’s list had been taken by a prior 

bidder, the next ranking item would be advanced to that round. This process 

would be repeated until all lists had been completely exhausted, and then the 

beneficiaries would be notified of the items they had won. Since everything had 

already been appraised, the dollar sum of all items of TPP selected by each 

beneficiary would be totaled for equalization in the future. Movers were reserved 

to move the TPP to the out-of-state homes of Dorothea, Margaret, and David by 

the end of business on May 5, 2011,50 and the beneficiaries were required to sign a 

release documenting that they had received all of their items. Any TPP remaining 

would belong to the Estate, to be disposed of in a manner determined by the Estate

 

48 Id.

49 Not all of the TPP was available for selection; thousands of unsorted textiles, 

family papers, unframed family photos, negatives, and home movies were among 

the sentimental items not to be divided during this process. Gibson’s letter stated: 

“[these] categories of items should most logically be divided with the four of you 

sitting together and going through ....” Id.

50 During this time period, Dorothea resided in California, David resided in 

Massachusetts, Margaret resided in New York, and Mary Harding resided in 

Delaware.. 
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Although Margaret had suggested the selection rotation order that ultimately 

was used,51 she was unhappy with other aspects of the TPP viewing and division 

process. Margaret complained about many aspects of the process, including: (1) 

not having received an inventory and photographs of the TPP52; (2) not having 

enough time to view the TPP;53 (3) not being allowed to bring her attorney and 

mother-in-law with her to view the TPP; (4) not having additional time to prepare 

and submit her priority order list; and (5) the process was more elaborate than the 

“drawing of lots” dictated in the second codicil of Mr. Cist’s will.

54

 Nevertheless, 

she participated in the process, and even attended the two auctions that took place 

during October 2011, where some of the remaining TPP was sold.55

E. Equalization Process

In November 2011, Mary Harding, in her capacity as executrix of the Estate 

of J. David Cist and successor trustee of the J. David Cist Supplemental Trust 

Agreement,

56 retained Pelillo to collect information and compute “the total for 

 

51 Ughetta Appendix at 289-290 (email from Bennett to Ferry sent April 30, 2011).

52 Id. at 107-108 (Mary Harding Deposition); Mary Harding Compilation at 534 

(Margaret deposition).

53 Ughetta Appendix at 125.1-125.3 (Margaret Deposition)

54 Id. at 280-282 (letter dated April 22, 2011, from Ferry to Reiver); at 287-288 

(letter dated April 29, 2011, from Ferry to Reiver); at 290.1-290.3 (letter dated July 

7, 2011, from Ferry to Reiver). 

55 Mary Harding Compilation at 286-287 (letter dated August 15, 2011, from 

Gibson to beneficiaries).

56 Mary Harding Compilation at 301-302 (November 1, 2011 engagement letter).
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lifetime transfers made by J. David Cist and Mary S. Cist [including] lifetime 

transfers made to each of their four children including transfers to or for the benefit 

of the child’s issue.”57 Mary Harding sought to continue the equalization process 

her father had begun.

58

 Her attorney described the scope of the project to Pelillo 

as follows:

For purposes of your calculations, please list transfers 

made by either or both parents beginning on July 1 of the year 

of each child’s college graduation until the death of J. David 

Cist on June 24, 2010. (The years of graduation will be 

provided by Mary Harding Cist.) Transfers to a child include 

transfers to or for the benefit of the child’s issue. Tuition 

payments directly to a school are to be considered transfers to a 

child, even though not considered transfers for gift tax 

purposes. Likewise, payments clearly made for the benefit of a 

specific child should be included even if the payments might be 

deemed support in some other context, because all the children 

were emancipated after college graduation. Include all 

transfers, no matter how small. My understanding is that many 

of the checks and other contemporaneous records have 

notations made by J. David Cist and/or Mary S. Cist identifying 

the child who received the benefit. In addition, we have all gift 

tax returns filed by Mary S. Cist and J. David Cist, and will add 

those gifts to your calculations. Transfers are included at their 

date-of-transfer values.59

By letter dated November 16, 2011, Pelillo informed the four beneficiaries 

that he had been retained to review their parents’ financial records and “to compute 

the lifetime gifts and other transfers your parents made to you and/or your children, 

 

57 Id. at 301. 

58 Ughetta Appendix at 120 (Mary Harding deposition).
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in accordance with your father’s trust terms.”60 Pelillo outlined the records he had 

reviewed, the procedures he had followed, and provided the preliminary tallies of 

the lifetime gifts/transfers he had prepared for each beneficiary. He then described 

the inspection process whereby each beneficiary could make an appointment to

inspect the records that he had reviewed in preparing the tallies, and the procedure 

the beneficiaries must follow to request changes or corrections to their tallies. 

Finally, Pelillo set forth a timetable for the inspection and review process,

transmission of completed tallies, and last day (January 12, 2012) for additional 

corrections, warning the beneficiaries that no extensions would be permitted 

because January 17, 2012 was the deadline for the Estate to file IRS Form 8939 

(“Allocation of Increase in Basis of Property Acquired From a Decedent”).

Margaret objected to the “unreasonable deadlines” of the equalization 

process,

61 but ultimately cooperated with Pelillo’s deadlines.62

 Nevertheless, 

Margaret reserved her right to challenge her tally and the distribution process.63 

The beneficiaries were informed of the outcome of the equalization process by 

 

59 Mary Harding Compilation at 298-299 (letter dated October 28, 2011, from 

Reiver to Pelillo).

60 Id. at 304-309 (letter dated November 16, 2011, from Pelillo to beneficiaries).

61 Ughetta Appendix at 305 (letter dated December 2, 2011, from Ferry to Reiver). 

62 Id. at 307-308 (letter dated January 10, 2012, from Thomas R. Riggs, Esq. to 

Reiver and Bennett). 

63 Id.
Page 20 of 46

letter dated April 13, 2012,64 which set forth the amounts each beneficiary had 

received in “lifetime gifts” and from Mrs. Cist’s trust, the amount of Mary 

Harding’s half-interest in the Wilmington residence, the total values of the TPP

items each beneficiary had been awarded, and the amount of cash that was to be 

distributed to equalize each beneficiary’s share of their parents’ lifetime and postmortem gifts. David, who had received the smallest distribution from Mrs. Cist’s 

trust, was allocated nearly two-thirds of the equalizing cash that was to be 

distributed by Mr. Cist’s trust. Mary Harding and Dorothea were to receive 

unequal shares of the remaining cash to be distributed by Mr. Cist’s trust. 

Margaret, who had received the largest amount (in monetary terms) of lifetime 

gifts from her parents and the largest distribution from Mrs. Cist’s trust, was to 

receive no cash at all from Mr. Cist’s trust.

65

 

II. PROCEDURAL BACKGROUND 

On September 21, 2012, Margaret filed a petition in this Court to compel an 

accounting, remove the trustee, and for other similar relief. In her petition, 

Margaret alleges that Mary Harding breached her fiduciary duties to the 

beneficiaries by violating the provisions of the second amendment of the trust 

regarding alternating selections of TPP to be determined by the drawing of lots, 

 

64 Mary Harding Compilation at 555-557 (letter dated April 13, 2012, from Bennett 

to beneficiaries). 
Page 21 of 46

and by refusing to answer Margaret’s numerous requests for (a) information 

regarding the administration of the decedent’s estate; (b) reconsideration of the 

onerous TPP distribution process; (c) modification or elimination of the release 

requirement to obtain her personal property; (d) information regarding the location 

and valuation of family history items and precious metals, and (e) reconsideration 

of the unreasonable and burdensome equalization procedure. The petition also 

alleges that Mary Harding has shown palpable hostility toward Margaret, which 

casts grave doubts on Mary Harding’s ability to equitably administer the estate and 

trust and impairs the administration of the trust. On October 22, 2012, Mary 

Harding responded to the petition, denying the allegations, and counterclaiming

that Margaret’s petition violated the no-contest provision of the Trust. 

Accordingly, Mary Harding seeks an order reducing Margaret’s bequest by half

and holding Margaret’s reduced bequest responsible for paying attorney’s fees and 

costs incurred by both parties. 

On July 16, 2013, Margaret moved to compel responses to discovery from 

Mary Harding; in particular, Margaret sought to compel the production of the TPP 

lists of the four beneficiaries, which she alleged were “relevant in determining 

whether the Equalization Process was carried out fairly and properly, and whether 

 

65 Margaret and her siblings also received equal in-kind distributions of shares of 

stock and precious metals from Mr. Cist’s trust. Id.
Page 22 of 46

each beneficiary’s distributions were truly equal.”66 Six days later, on July 22, 

2013, Mary Harding filed a Motion for Summary Judgment and opening brief in 

support of her motion.

67

 In response, Margaret filed a Motion to Allow Discovery 

under Court of Chancery Rule 56(f) on July 31, 2013.68 While briefing was being 

completed on the above three motions, Margaret filed a Motion for Interim Relief 

on September 6, 2013, seeking an order directing the trustee not to sell or distribute 

some newly-discovered items of TPP and allowing Margaret unrestricted rights to 

view the property for as long as necessary, accompanied by experts and other 

agents in order to view, photograph and appraise the items.69 Oral argument on the 

pending motions was scheduled for September 30, 2013, but shortly before it could 

take place, the judicial officer assigned to this case discovered that she had a 

conflict that prevented her from hearing the matter.70 The case was reassigned to 

me on October 1, 2013.71 Following oral argument on the pending motions on 

November 12, 2013,72 I issued a draft report on November 25, 2013, in which I 

recommended that the three motions be granted.73 The successor trustee took 

 

66 Ughetta’s Motion to Compel, at ¶ 29. Docket Item (hereinafter “DI”) 16.

67 DI 17 & 18. 

68 DI 22.

69 DI31. 

70 DI 38. 

71 DI 39.

72 DI 45.

73 Ughetta v. Cist, Del. Ch., C.A. No. 7885-MA (Nov. 25, 2013 (Master’s Draft 

Report). DI 48.
Page 23 of 46

exception to the draft report.

74

 After briefing, I slightly modified my draft report to 

reflect that the issue of whether the trust required equal (or as nearly equal as 

possible) appraised values of TPP to be received by each beneficiary had not yet 

been determined.75

On March 1, 2014, Margaret filed a second Motion for Interim Relief to 

prevent her videotaped deposition from being circulated publicly, which was 

granted,76 and a Motion to Compel the production of a letter from the successor 

trustee documenting Mr. and Mrs. Cist’s gift of a valuable autograph collection to 

David when he was eight years old.77 During a teleconference on Jun 13, 2014,78 I 

asked the parties to submit legal memoranda on the issue of whether certain 

language in the trust was ambiguous, requiring the Court to consider extrinsic 

evidence to determine the trustor’s intent.79 While the parties were submitting 

their legal memoranda, Margaret moved to compel the deposition testimony of W. 

Donald Sparks, II, Esquire, who had drafted Mr. and Mrs. Cist’s wills and original 

supplemental trust agreements,

80 because David, in his capacity as co-personal 

representative of Mrs. Cist’s estate, had asserted the attorney-client privilege for all 

 

74 DI 49.

75 Ughetta v. Cist, Del. Ch., C.A. No. 7885-MA (April 30, 2014) (Master’s Final 

Report). DI 81. 

76 DI 61 & 72.

77 DI 62.

78 DI 93.

79 DI 96. 
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communications between and among Sparks and Mr. and Mrs. Cist.81 On October 

23, 2014, following oral argument on the pending motions, I issued an oral draft 

report in which I found that the phrase “during our lifetimes” was unambiguous, 

but that the phrase “the value of [our] ... transfers to our children (including 

transfers to, or for the benefit of, issue of a child as transfers to that child ...” was 

capable of having more than one meaning and was ambiguous. I recommended 

that extrinsic evidence should be examined to determine the trustor’s intent as to 

the latter phrase, but not as to the former one.

82

 I also recommended that Sparks’ 

deposition go forward provided the questions were limited to the subject of 

trustor’s intent as to the meaning of the transfer phrase.

83

 Since more than four 

years had elapsed since the death of Mr. Cist, the parties were anxious to move this 

matter along and agreed to a stay of the period of time of taking exceptions to my 

oral draft report.

84

 On December 15, 2014, Margaret filed her Answering Brief in 

 

80 DI 100.

81 In a related matter, Margaret’s husband, William C. Ughetta, Jr., as co-trustee of 

the Mary S. Cist GST Trust, is seeking a declaratory judgment against David, in 

his capacity as the other co-trustee of the Mary S. Cist GST Trust. Ughetta v. Cist, 

C.A. No. 9416-MA. 

82 Transcript of Oral Argument on October 23, 2014, at 39-41. DI 121.

83 Id. at 41-42. 

84 Id. at 76. 
Page 25 of 46

response to Mary Harding’s Motion for Summary Judgment,

85 and Mary Harding’s 

Reply Brief was filed on January 7, 2015.86 

III. ANALYSIS

A motion for summary judgment may be granted if no genuine issue of 

material fact is in dispute and the moving party is entitled to judgment as a matter 

of law.87 The burden is on the moving party to establish that there are no issues of 

material fact,88 and the court must review all evidence in the light most favorable 

to the non-moving party.89 Once the moving party has met its burden to show no 

material facts exist, the nonmoving party must submit “specific facts showing that 

there is a genuine issue for trial to survive a motion for summary judgment.”90

Mary Harding claims that she is entitled to summary judgment because 

Margaret has failed demonstrate that the successor trustee breached her fiduciary 

duty to any beneficiary in distributing the TPP or in calculating the equalization 

tallies. Mary Harding argues that since Margaret actively participated in the TPP 

distribution process, Margaret cannot now object to the process after the TPP has 

been packaged and shipped to Dorothea and David. Similarly, Mary Harding 

 

85 DI 125.

86 DI 127.

87 Ct. Ch. R. 56.

88 Scureman v. Judge, 626 A.2d 5, 10 (Del.Ch. 1992).

89 Id. at 10-11. 
Page 26 of 46

argues that since she merely followed the equalization process established by Mr. 

Cist before his death, there can be no dispute that Margaret was treated fairly. 

Finally, Mary Harding claims that because Margaret has challenged the TPP 

distribution and equalization processes, her share of the trust should be reduced by 

50 percent under the terms of the no-contest provision of the trust.

In response, Margaret argues that there is a factual dispute regarding what 

Mr. Cist intended to include as a “transfer” during his and Mrs. Cist’s lifetimes, 

which presents a genuine issue of material fact. Margaret also argues that there are 

other material facts at issue, i.e., whether Mary Harding adhered to the language of 

the trust in allowing the beneficiaries to determine a method of distributing the 

TPP, whether Gibson’s complex process of distributing the TPP was in keeping 

with the language of the trust, and whether Mary Harding’s decision to start the 

equalization process calculation one month after each beneficiary graduated 

college was not only arbitrary, but also in direct conflict with the express language 

of the trust. Finally, Margaret responds that she has not triggered the no-contest 

provision because she has not challenged the validity of the trust or any of its 

dispositions. Instead, Margaret claims that she is challenging whether the 

successor trustee breached her fiduciary duty by failing to carry out the terms of 

 

90 In re Novell, Inc. S’holder Litig., 2014 WL 6686785, at *6 (Del.Ch. Nov. 25, 

2014) (quoting Goodwin Live Entm’t, Inc., 1999 WL 642565, at *5 (Del.Ch. Jan. 

25, 1999), aff’d, 741 A.2d 16 (Del. 1999)). 
Page 27 of 46

the trust document and by acting hostilely toward one beneficiary. According to 

Margaret, summary judgment would be inappropriate because the Court should 

hear testimony to judge the demeanor and credibility of the parties and witnesses. 

A. The TPP Distribution Was Consistent with the Language of Mr. 

Cist’s Trust.

While represented by counsel and aware of the terms of Mr. Cist’s estate 

planning documents, Margaret participated in the TPP distribution. Mary Harding 

now argues that because Margaret actively joined in the process, she should be 

required to accept it and the results of the process. According to Mary Harding, 

Margaret stood by while the TPP items selected by Dorothea and David were 

transported to their respective residences at trust expense.

91 Nor did Margaret 

object to the use of the TPP values in the equalization process. Therefore, 

according to Mary Harding, it is too late for Margaret to object. Margaret argues 

that her participation in the TPP distribution was not an indication of consent or 

acquiescence because she had no other option but to participate in the process or 

else risk receiving nothing. She also argues that the process used to divide the TPP 

 

91 The petition was filed on September 21. 2012, DI 1, more than a year after the 

TPP had been shipped to David and Dorothea’s respective residences in 

Massachusetts and California in May 2011. Mary Harding Compilation at 280 

(Gibson letter to beneficiaries dated April 14, 2011). Under the trust agreement, 

the successor trustee was directed to pay the cost of shipping the TPP as an 

administration expense. Id. at 126 (Section II, Paragraph B-1(c), Second 

Amendment to Supplemental Trust Agreement of John David Cist).
Page 28 of 46

was not consistent with the express terms of her father’s trust. As a result,

Margaret argues that she is not estopped from challenging the trustee’s actions by 

virtue of having participated in the TPP distribution, citing 76 Am.Jur.2d, Trusts § 

327. 

The general rule is that she “who participates in or acquiesces in an action 

has no standing in a court of equity to complain against it.”92 For the defense of 

acquiescence to apply, the claimant must have had full knowledge of her rights and 

the material facts and (1) remained inactive for a considerable time or (2) freely 

did what amounts to recognition of the complained of act, or (3) acted in a manner 

inconsistent with the subsequent repudiation, which led the other party to believe 

that the act had been approved.93 Margaret appears to be suggesting that she was 

coerced into participating or else she might not have received any items of TPP. 

That the TPP is important to Margaret is evidenced by the fact that she filed this 

action in part to compel the successor trustee to release and ship to Margaret the 

items of TPP she had selected.94 

The undisputed record shows that on numerous occasions before, during, 

and after the TPP distribution, Margaret voiced objections to and frustrated the 

 

92 Gottlieb v. McKee, 107 A.2d 240, 244 (Del.Ch. 1954); Trounstine v. Remington 

Rand, Inc. 194 A. 95, 99 (Del.Ch. 1937). 

93 Klaasen v. Allegro Development Corp., 106 A.3d 1035, 1047 (Del. 2014) (citing 

Cantor Fitzgerald, L.P. v. Cantor, 724 A.2d 571, 582 (Del.Ch. 1998)). 

94 Petition to Compel Accounting, DI 1. 
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successor trustee’s efforts to distribute the TPP. Discussions among the 

beneficiaries about the method of TPP distribution began on August 6, 2010. 

Margaret refused to agree to the standard selection rotation (1,2,3,4,/1,2,3,4/etc.)

that the family had used in three previous TPP distributions, and she also refused to 

agree to a selection ordered to be determined by lots.95 She would not agree with 

the other beneficiaries on a date for the distribution and, since Margaret’s attorney 

wanted to wait until the creditor claims period ended, the TPP distribution was 

postponed until after February 24, 2011.96 Meanwhile, Margaret objected to the 

appraiser Mary Harding had retained, so Mary Harding hired another appraiser to 

start the appraisal process anew.97 A proposed distribution date of March 15, 2011, 

was changed, upon Margaret’s request for a later date, to April 30, 2011.98 By 

letter dated March 15, 2011, Margaret’s new co-counsel contacted the trust’s 

attorney with questions about several aspects of the estate and trust, including the 

 

95 Mary Harding Compilation at 2-3 (Mary Harding Affidavit).

96 Id. at 3 (Mary Harding Affidavit). 

97 The successor trustee sent each beneficiary a copy of the complete appraisal 

report as soon as it was received. Id. at 3-4 (Mary Harding Affidavit). According 

to a letter from her counsel, partial appraisals were sent to the beneficiaries on 

March 22nd, April 14th, and April 22nd). Id. at 164-165. (letter dated April 22, 

2011 from Reiver to Ferry). Margaret’s counsel, however, claimed that the first 

time that he received any appraisal was April 14th. Ughetta Appendix at 280 (letter 

dated April 22, 2011 from Ferry to Reiver). 

98 In a letter to the trust’s attorney, however, Margaret’s co-counsel stated: “It is 

my understanding that your client Mary Harding Cist, has established a deadline 

date of April 9, 2011, to address the disposition of the tangible personal property.” 

Ughetta Appendix at 260 (Letter dated March 15, 2011, from Ferry to Reiver). 
Page 30 of 46

TPP and the equalization tallies. Co-counsel wanted to see the TPP appraisal, and 

demanded “clear photos of every item and, for the rare books, a clear photo of each 

frontis page.”

99

 The March 15th letter concluded as follows:

The above are just some of the initial things that require answers before we 

proceed. There may be additional questions later. I hope you are able to 

convince your client that she must provide this information and do so 

promptly. My client does want to bring this matter to closure promptly and 

hopes that information she has requested can be provided promptly in order 

to do so. However, if your client is unwilling to allow you to answer these 

questions and provide this information, I have told my client that litigation 

may be the only way to resolve this matter and, if necessary, that litigation 

will be filed.100 

As a result of this letter, the successor trustee hired Gibson to oversee the 

TPP process. Gibson participated in a conference call with the successor trustee, 

her counsel, and Margaret’s new co-counsel so that Gibson could explain his 

background and experience in TPP distribution, describe the upcoming process for 

this TPP distribution, and answer the questions of Margaret’s attorney.101 

Nevertheless, Margaret continued to complain about the process. By letter dated 

April 22, 2011, Margaret complained that she: (1) had insufficient time to review 

the appraisals; (2) had not been provided photographs of the TPP, especially the 

frontis pages of the books; (3) had been denied prior access to the house to view 

the items; (4) had been denied the opportunity to have legal counsel and her 

 

99 Id. at 261.

100 Id.

101 Mary Harding Compilation at 273 (Gibson’s Affidavit). 
Page 31 of 46

mother-in-law during the viewing periods; (5) had been denied a meeting with the 

successor trustee and her counsel; (6) had not been allowed to see the TPP lists of 

the other beneficiaries; (7) had been denied the opportunity to select items that 

might be left over after the other beneficiaries had made their selections; and (8) 

been refused a copy of the letter allegedly signed by Mr. and Mrs. Cist gifting the 

autograph collection to David in 1970.

102

 In response to Margaret’s complaints, 

Mary Harding and David changed their schedules to accommodate Margaret, and 

David even offered Margaret one of his TPP viewing time slots, which she 

declined.103 Margaret also wanted to submit her priority selection list two days 

after the deadline of April 30th,

104 and on May 3rd

, Margaret e-mailed Gibson to ask 

if she could add more items to her TPP list.105 None of her requests was granted by 

Gibson because it would have given Margaret preferential treatment over the other 

beneficiaries. After the TPP was selected, all the beneficiaries except Margaret 

signed the receipt and release agreement drafted by the trust’s attorney. Gibson 

therefore arranged for the storage of Margaret’s items until such time as Margaret 

 

102 Ughetta Appendix at 280-282 (letter dated April 22, 2011 from Ferry to 

Reiver).

103 Mary Harding Compilation at 273 (Gibson’s Affidavit); Id. at 167 (email dated 

April 30, 2011 from Bennett to Ferry). 

104 Id. at 273 (Gibson’s Affidavit). 

105 Id. at 274.
Page 32 of 46

signed the agreement.106 Negotiations to resolve this particular dispute failed after 

Margaret refused to sign a revised form of receipt and release agreement.107 

It is not necessary for me to reach the issue of acquiescence. Regardless of 

whether Margaret freely participated in the TPP process or not, she has failed to 

demonstrate the existence of a genuine issue of material fact regarding the 

successor trustee’s impartiality in distributing the TPP. Mr. Cist’s trust stated: “If 

my children are unable to agree upon a method of distribution among themselves, 

distributions will be by alternating selection in order to be determined by the 

drawing of lots.”108 That is what occurred here. On August 6, 2010, when the 

beneficiaries first met to discuss the TPP distribution, the successor trustee tried to 

get the beneficiaries to agree upon a method of distribution. Margaret refused to 

agree with the other beneficiaries on a selection order to be determined by lots 

during this meeting and on a subsequent conference call.109 Since Mr. Cist’s 

children were unable to agree upon a method of distribution, the successor trustee 

turned to the default provision above – “distributions will be by alternating 

selection in order to be determined by the drawing of lots.” Moreover, the 

successor trustee did not breach her fiduciary obligations to the beneficiaries when 

 

106 Id.

107 Id. at 5 (Mary Harding Affidavit); id. at 169-171 (email dated May 26, 2011 

from Reiver to Ferry). 

108 Id. at 126. (Second Amendment to Supplement Trust Agreement of John David 

Cist).
Page 33 of 46

she retained an experienced estate administrator who used a process of alternating 

selections of items of TPP in an order that was determined by the random drawing 

of the beneficiaries’ names out of a hat. Each beneficiary was treated impartially 

by the administrator. Each beneficiary was given the same opportunity to view the 

TPP and make a priority selection list, and each beneficiary had the same chance of 

being awarded his or her selected items through a selection order that had been 

previously determined at random. 

After the TPP distribution took place, Margaret sought and obtained a court 

order compelling the production of the other beneficiaries’ TPP selection lists. 

Despite having obtained this information concerning her siblings’ priority 

selections, Margaret has been unable to point to any specific evidence of unfairness 

or lack of impartiality during the TPP distribution process. Since Margaret has 

failed to demonstrate the existence of a genuine issue of material fact, the Court 

should grant summary judgment in favor of Mary Harding regarding her 

administration of the TPP distribution. 

B. The Successor Trustee Did Not Act in Bad Faith or Exceed her 

Discretion in Following the Equalization Process Established Mr. 

Cist During His Lifetime.

 

109 Id. at 3 (Mary Harding Affidavit). 
Page 34 of 46

Mary Harding argues that there is no dispute that Mr. Cist intended to make 

equalizing transfers, that he told his lawyers, his son, and his accountant what he 

intended, and there can be no doubt as to what he tried to achieve in the months

before he passed away. According to Mary Harding, the language of Mr. Cist’s 

trust requires the successor trustee to take into account Mr. Cist’s pre-death 

decisions on what lifetime transfers to include in the equalization process. 

Margaret, on the other hand, argues that the phrase “during our lifetimes” is 

unambiguous, and that the successor trustee failed to follow the express provisions 

of the trust agreement. By recreating Mr. Cist’s course of conduct before his 

death, her argument goes, the successor trustee exceeded the bounds of her 

discretion.

Delaware law is clear that when construing a trust instrument, “the Court 

attempts to discern the settlor’s intent as expressed by the instrument, read as a 

whole, in light of the circumstances surrounding its creation.”110 The words used 

in the instrument will be “given their ordinary meaning and the Court will not 

consider extrinsic evidence to vary or contradict express provisions of a trust 

instrument that are clear, unambiguous and susceptible of only one 

 

110 Wilm. Trust Co. v. Annan, 531 A.2d 1209, 1211 (Del.Ch. 1987) (citing Dutra de 

Amorim v. Norment, 460 A.2d 511, 514 (Del. 1983)), aff’d Annan v. Wilm. Trust. 

Co., 559 A.2d 1289, 12982 (Del. 1989)). See also In re Pierls Family Inter Vivos 

Trusts, 77 A.3d 249, 263 (Del. 2013). 
Page 35 of 46

interpretation.”111 An ambiguity may exist if the terms are reasonably or fairly 

susceptible to different interpretations or may have two or more different 

meanings.112

I previously issued a draft bench report finding that the phrase “during our 

lifetimes” found in Paragraph D(1) of both the First Amendment and the Second 

Amendment of the Supplemental Trust Agreement of John David Cist was 

unambiguous.113 Upon further review of the trust instruments, I have decided sua 

sponte to modify my draft report after concluding that the phrase “during our 

lifetimes” is ambiguous when read in conjunction with Paragraph D(4) of the 

Second Amendment of the Supplemental Trust Agreement of John David Cist. 

Paragraph D(4) states:

4. I intend to make substantial equalizing transfers during my 

lifetime after the execution of this supplemental trust agreement. 

Such lifetime equalizing transfers reflect my intent to devise my onehalf interest in [the Wilmington residence] to my daughter Mary 

Harding Cist upon my death, by reducing my lifetime transfers to such 

daughter. The trustee shall take such transfers into account in making 

distribution hereunder to achieve my intent as nearly as possible, so 

that if such equalizing transfers were completed during my lifetime, 

upon my death my one-half interest in the [Wilmington residence] 

will be distributed to Mary Harding Cist, and the balance of my 

 

111 DiSabatino v. DiFerdinando, 2002 WL 2005743, at *2 (Del. Ch. Aug. 13, 

2002) (quoting Wilm. Trust Co. v. Annan, 531 A.2d 1209, 1211 (Del. Ch. 1987)). 

112 Id. at *2 n. 8 (citing ABB Flakt, Inc. v. Nat’l Union Fire Ins. Co., 731 A.2d 811, 

816 (Del. 1999)). 

113 Ughetta Appendix at 205 (Transcript of Oral Argument on October 23, 2014, at 

40). 
Page 36 of 46

remaining estate and trust assets shall be divided equally among my 

children, ... .114

The third sentence of Paragraph (D)(4), which requires the trustee to “take such 

transfers into account in making distribution hereunder to achieve my intent as 

nearly as possible, so that if such equalizing transfers were completed during my 

lifetime ...,” is ambiguous. It is unclear whether the phrase “such transfers” refers

to Mr. Cist’s intended lifetime transfers to Mary Harding in the second sentence or 

to his intended “substantial equalizing transfers” in the first sentence of Paragraph 

D(4). In either case, it is unclear why the direction to the successor trustee is not 

predicated on the actual completion of his lifetime equalizing transfers.

When I issued my draft report on the parties’ legal memoranda, I 

disregarded the language in Paragraph D(4) altogether because Mr. Cist had died 

prior to making the lifetime equalizing transfers.115 In doing so, I ignored a basic 

rule of construction that a court will prefer an interpretation that gives effect to 

each term of an agreement and avoids rendering language superfluous or uselessly 

repetitive.116 Upon closer reading, the third sentence of Paragraph (D)(4) only 

makes sense as providing direction to the successor trustee -- in the event that Mr. 

 

114 Mary Harding Compilation at 126. 

115 Ughetta Appendix at 205. 

116 Peierls Family Inter Vivos Trusts, 77 A.2d at 265 (citing O’Brien v. Progressive 

N. Ins. Co. 785 A.2d 281, 287 (Del. 2001).
Page 37 of 46

Cist died before he completed the substantial equalizing transfers117-- in order to 

achieve his goal of having each child receive an equal share of Mr. and Mrs. Cist’s 

combined estates and lifetime gifts. If Mr. Cist had made the “substantial

equalizing transfers” during his lifetime, his trust agreement would have been 

completely restated since there would have been no need for the successor trustee 

to have undertaken the equalization process set forth in Paragraphs D(1) and 

(D)(2). All that would have remained in Mr. Cist’s estate and trust, after his onehalf interest in the Wilmington residence had been distributed to Mary Harding,

would have been divided into four equal shares. If Paragraph D(4) is not to be 

treated as superfluous, it must be read together with Paragraphs (D)(1) and (D)(2), 

and the resulting ambiguity warrants an examination of the extrinsic evidence 

concerning Mr. Cist’s intent in making those lifetime transfers. 

The record shows that in preparing to fund the four irrevocable GST trusts,

Mr. Cist did not calculate the lifetime gifts to his children in a literal sense, i.e., he 

did not attempt to add up all the gifts and transfers to his children made over the

course of his and Mrs. Cist’s lives. Instead, he wanted to include only those gifts 

and transfers that had been made in the years following the children’s graduation 

from college.118 According to his attorney, Mr. Cist considered starting the

 

117 The Second Amendment was executed on January 6, 2010, and Mr. Cist died a 

few months later on June 24, 2010.

118 Mary Harding Compilation at 474 (Reiver Deposition).
Page 38 of 46

calculations after the youngest child, Mary Harding, had graduated from college, 

but he concluded that it would be unfair to the three youngest children. Instead, he 

opted for a staggered beginning point, i.e., the calculation was to begin after each 

child graduated from college.119 Many of the earlier records dating back to 1980 

when Dorothea graduated from college were unavailable to Mr. Cist,

120 so he 

began with records from 1985.121 Pelillo subsequently reviewed the lists of gifts 

and transfers that Mr. Cist and David had compiled.122 Included on these lists was 

a large monetary gift to Margaret’s husband on December 1, 2007,

123 which was

allocated to Margaret, and a large monetary gift to David’s wife on December 31, 

2007, which was allocated to David.124 After Pelillo was hired by Mr. Cist’s 

estate and trust to prepare the equalization tallies, Reiver instructed Pelillo to 

attribute any gifts to Margaret’s husband to Margaret’s tally.

125

 However, this 

instruction was not exclusively directed at Margaret. The tallies Pelillo

 

119 Id. at 463 (Bennett Deposition).

120 Id. at 463; id at 310-311 (“Overview” of Mr. Cist’s Estate prepared by Mary 

Harding).

121 Id. at 464 (Bennett Deposition). 

122 Id. at 137 (Deposition of Victor Pelillo).

123 Id. at 148. In his deposition, Pelillo stated that the amount of this gift was 

$20,000. Exhibit A attached to Pelillo’s letter dated October 29, 2009, to Mr. Cist 

and David, id. at 291-294, is the list that had been prepared by Mr. Cist and David. 

Id. at 295-296. It includes a gift of $20,000 to “William” and a gift of $24,000 to 

“Bill” on December 1, 2007; both gifts were included in Margaret’s tally and, 

presumably, represent separate gifts to Margaret’s husband and son, both of whom 

are named William. Id. at 296. 

124 Id. at 295.
Page 39 of 46

subsequently prepared for Margaret and David included gifts and transfers to and 

for the benefit of both Margaret’s and David’s respective spouses and children.

126

 

Margaret argues that the express trust provisions do not include transfers to 

spouses and the successor trustee’s decision to start the equalization process one 

month after each beneficiary graduated college was not only arbitrary, but also 

directly and unfairly benefited David by shielding his autograph collections from 

being included in the process. The extrinsic evidence reveals, however, that the 

decisions to include gifts to spouses and to begin the calculation after each of Mr. 

Cist’s children graduated from college had been made by Mr. Cist himself. The

successor trustee’s instructions to Pelillo were based on the information and 

records that Mr. Cist previously had provided to Pelillo. The successor trustee, 

therefore, was merely following the parameters that had been established by the 

trustor,

127 and did not breach her fiduciary duty when she completed the 

equalization process that had been started by Mr. Cist. 

The record shows that Mr. Cist did not intend to include any gifts or 

transfers to his children before they graduated college, but he did intend to include 

gifts and transfers to his children after they had graduated from college, in addition 

to gifts and transfers to and for the benefit of his children’s spouses and his 

 

125 Id. at 150, 154 (Pelillo Deposition). 

126 Id. at 327-339 (Margaret Final Tally); id. at 494-501 (David Tally). 

127 Id. at 120 (Mary Harding Deposition).
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grandchildren. Margaret has pointed to no specific evidence of Mr. Cist having 

had a contrary intent that would create a genuine issue of material fact in dispute. 

Therefore, I recommend that summary judgment be granted in Mary Harding’s 

favor regarding her administration of the equalization process. 

C. There Is No Cause for Removal or for Compelling the Successor 

Trustee to Provide an Accounting.

Margaret argues that there are genuine issues of material whether she is 

entitled to an accounting and the removal of the successor trustee, and she 

buttresses hers argument by recapitulating all of her previous complaints against 

the successor trustee. Margaret accuses the successor trustee of being hostile 

towards her, and contends that there are legitimate questions whether the successor 

trustee acted with impartiality toward all the beneficiaries and whether or not she 

should be removed as trustee. Finally, Margaret claims that she is entitled to a 

complete accounting of all assets, receipts, income, expenses and debts of the 

estate and trust because her repeated requests for an accounting have been denied.

The record shows that the successor trustee put in place TPP distribution and 

equalization processes that were applied equally to the four beneficiaries. Each 

beneficiary was given the same amount of time to: (1) view the TPP and (2) 

prepare and submit a priority selection list. The selection process itself was done 

by rotation (as agreed upon by the four beneficiaries) in an order determined by the 
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random drawing of names out a hat. Similarly, each beneficiary was given the 

same amount of time to: (1) review the documents that provided the basis for 

Pelillo’s initial equalization tally and (2) make revisions or corrections to his or her 

own tally provided there was supporting documentation for such revisions or 

corrections. The record shows that of the four beneficiaries, only Margaret 

objected to these processes and only Margaret demanded that exceptions be made 

for her. The failure to accord special treatment for Margaret does not demonstrate

hostility or lack of impartiality on the part of the successor trustee. 

Throughout the administration of this trust and estate, Margaret repeatedly 

requested information, photographs, appraisals and other documents from the 

successor trustee, and Margaret was provided with most, but not everything that 

she had requested.

128

 Aside from Margaret’s own subjective dissatisfaction with 

the successor trustee’s responses, Margaret points to no evidence that the successor 

trustee acted hostilely or lacked impartiality when dealing with Margaret.129

 

128 Id. at 231-263 (History of Questions & Responses). Ughetta Appendix at 260-

323 (correspondence between Margaret’s counsel and successor trustee’s counsel 

between March 15, 2011 and July 11, 2012). 

129 One example Margaret gave to demonstrate the successor trustee’s alleged 

failure to provide her with information is somewhat disingenuous. The requested 

information was described as letter requesting documentation that the beneficiaries 

had agreed to the TPP distribution process. Petitioner Margaret C. Ughetta’s 

Answering Brief in Response to Respondent’s Motion for Summary Judgment at 

37. The actual letter instead requested documentation that Margaret had agreed to 

the TPP distribution process. Given Margaret’s record of complaints about the 

TPP process, it is unlikely that such a document existed so the successor trustee 
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Similarly, Margaret has not shown cause for an accounting.130 The fact that her 

repeated requests for an accounting have been denied in and of itself does not 

amount to cause for the Court to compel the successor trustee provide an 

accounting when the trust and estate are still in the process of being administered, 

there is a significant amount of TPP yet to be distributed, and fees and costs 

associated with this litigation and the storage of TPP continue to accrue. 

Therefore, I recommend that summary judgment be granted in favor the successor 

trustee on the issue of the trustee’s removal and the requirement of an accounting. 

D. The No Contest Provision Has Not Been Violated by Margaret’s 

Petition.

In her counterclaim, Mary Harding alleges that Margaret’s petition violates 

the no contest provision of Mr. Cist’s trust and, as a result, her bequests must be 

reduced by half and must bear the cost of attorneys’ fees and costs incurred by 

Margaret as well as by the trustee. According to Mary Harding, the no contest 

provision is very broad, and Margaret’s challenges to the TPP distribution and 

equalization processes fall within its scope. In addition, Mary Harding describes 

as “simply false” Margaret’s contentions that information was withheld from her, 

and that Margaret has unjustly burdened the trust administration with her 

 

can hardly be faulted for failing to provide it. Ughetta Appendix at 299 (Letter 

dated August 3, 2011 from Ferry to Reiver). 

130 See 12 Del. C. § 3522(2). See also 1A C.J.S. Accounting § 44. 
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objections and numerous questions, despite all the information that had been 

provided to her.131 Margaret denies that she has challenged any disposition 

provided for in the trust, which would have constituted a violation of the no contest 

provision. Instead, Margaret claims that she is challenging the administration of 

the trust in an effort to enforce the express language of the trust, i.e., the 

calculation of lifetime gifts to Mr. and Mrs. Cist’s children and grandchildren in 

the equalization process, and the drawing of lots for the TPP distribution. 

Paragraph C of Section II of the 2006 Supplemental Trust Agreement of 

John David Cist, as modified by the First Amendment, provides:

If any beneficiary under this instrument files an action in any 

court seeking to set aside any aspect of the document, or to challenge 

any aspect of the disposition provided herein, the bequest to such 

beneficiary shall be partially ineffective and void, and the bequest 

such beneficiary would have received, but for such challenge, shall be 

reduced by one-half (i.e., fifty percent). The contestant’s share shall 

also bear the costs of attorneys’ fees and costs incurred by the 

contestant as well as attorneys’ fees and costs incurred by my 

fiduciaries in defending the action. The portion by which such 

contesting beneficiary’s bequest is reduced shall be distributed in 

equal shares to the non-contesting beneficiaries. The provisions of 

this provision shall also apply to specific takers in default, if any, 

provided in such bequest hereunder. This provision shall apply in the 

case of challenges based on fraud, mistake, undue influence, or 

incapacity, or upon any other basis.132

 

131 Respondent Mary Harding Cist’s Opening Brief in Support of Her Motion for 

Summary Judgment, at 42. 

132 Mary Harding Compilation at 121. 
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I do not include challenges to the administration of a trust within the scope 

of the catchall phrase, i.e., “upon any other basis[,]” of this provision because there 

is a distinction between a challenge to the propriety of a trustee’s actions and an 

attack on the provisions of the trust itself.133 Margaret is not seeking to alter or 

change any of the provisions of Mr. Cist’s trust.134 Instead, she is attempting to 

enforce the provisions regarding the TPP distribution and the equalization process 

according to their terms, as she has interpreted them. Mary Harding herself has 

argued that certain terms in Mr. Cist’s trust are ambiguous. It is, therefore, 

reasonable for the parties to have advocated for different interpretations of the

language of Mr. Cist’s trust pertaining to the TPP distribution and the equalization 

process. While Mary Harding views this as an indirect challenge to the trust that 

has frustrated Mr. Cist’s intent and prolonged the administration of the trust, courts 

do not view disputes over the interpretation of instruments as violating a no contest 

 

133 See In re Vogel Sr. Living Trust, 2010 WL 2136643, at * 7 (Mich. App. May 

27, 2010); Labantschnig v. Bohlmann, 439 S.W.3d 269, 274 (Mo. App. E.D. 

2014). . 

134 In her Reply Brief, Mary Harding argues that Margaret is trying to set aside 

specific trust provisions, pointing to Margaret’s Answers to Interrogatories where 

she “objects’ to being charged for her children’s tuition in the equalization process. 

Respondent Mary Harding Cist’s Reply Brief in Support of Her Motion for 

Summary Judgment at 23. Since Margaret has not challenged the inclusion of her 

children’s tuition payments in the equalization process in either her Petition or her 

Answering Brief, I need not address this argument. Similarly, a removal petition 

does not challenge the trustor’s selection of a successor trustee, only the selected 

trustee’s performance of her fiduciary duties. McCaslin v. England, 2013 WL 

127787, at *4 (Cal.App. 4 Dist. Mar. 29, 2013). 
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clause.135 Even though I now disagree with Margaret’s interpretations of the 

trust’s terms, I do not find that Margaret has violated the no contest provision of 

Mr. Cist’s trust. 

Finally, I decline to recommend the award of costs and expenses to Mary 

Harding as a matter of justice and equity.136 Other than claiming that Margaret has 

unfairly prolonged this litigation and made unsupportable allegations, Mary 

Harding has shown no evidence of bad faith on Margaret’s part. Given that 

Margaret does not appear to have been included in the numerous meetings, 

discussions, and correspondence concerning Mr. Cist’s estate planning that 

occurred between and among her siblings, her father, her father’s attorneys, and 

Pelillo beginning in August 2008 until Mr. Cist’s death in June 2010, I do not find 

it surprising that Margaret has repeatedly sought information about and questioned 

the administration of her father’s trust. 137

 

135 See Donkin v. Donkin, 58 Cal.4th 412, 433-436 (Cal. 2013) (citing statutory and 

common law). 

136 12 Del. C. § 3585 provides: “In a judicial proceeding involving a trust, the 

court, as justice and equity may require, may award costs and expenses, including 

reasonable attorneys’ fees, to any party, to be paid by another party or from the 

trust that is the subject of the controversy.” 

137 The record suggests Margaret may have been purposely excluded from these 

discussions. Mary Harding Compilation at 460 (e-mail dated Oct. 25, 2009, from 

David to Pelillo: “By the way, since my sister Margie is going to be with Dad this 

week, I’d prefer to keep the communications only by email, or my cell .......”); id.

at 505 (e-mail dated Feb. 19, 2010, from Reiver to David: “I received a call last 

week from Richard J.A. Popper, Esq. and I spoke to Richard yesterday. He is 

representing your sister Margie and her husband, and wanted to talk to me about ... 
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CONCLUSION

For the foregoing reasons, I recommend that the Court grant Mary Harding’s 

Motion for Summary Judgment in part as to Margaret’s Petition to Compel 

Accounting and Remove Trustee, and deny in part as to Mary Harding’s 

counterclaim for forfeiture under the no contest provision of Mr. Cist’s trust. 

Instead, I recommend that the Court grant summary judgment in favor of Margaret 

as a matter of law on the counterclaim. This is my final report and exceptions 

may be taken in accordance with Rule 144.

Respectfully,

/s/ Kim E. Ayvazian

Kim E. Ayvazian

Master in Chancery

KEA/kekz

cc: David F. Ferry, Jr, Esquire

Edward M. McNally, Esquire

 

your father’s planning. I told him I would discuss his phone call with my client, J. 

David Cist, to determine what, if anything, I am authorized to disclose and 

discuss.”); id. at 452-453 (e-mail dated Feb. 26, 2010, from Reiver to Bennett: 

“Speaking of perfect storms, note that Richard Popper is representing Margaret and 

William Ughetta, and will be scrutinizing our actions to the extent he knows what 

we’re doing. I haven’t yet asked J. David Cist what, if anything, we are authorized 

to discuss or provided Richard.”)