Court Opinion

ID: 9929998
Source: CourtListenerOpinion
Date Created: 2024-02-05 21:04:38.937766+00
Date Added: 2024-06-11T10:58:27.164186
License: Public Domain

COURT OF CHANCERY
                                          OF THE
                                    STATE OF DELAWARE
LOREN MITCHELL                                                        LEONARD L. WILLIAMS JUSTICE CENTER
MAGISTRATE IN CHANCERY                                                 500 NORTH KING STREET, SUITE 11400
                                                                              WILMINGTON, DE 19801-3734

                                Final Report: February 5, 2024
                                Date Submitted: September 6, 2023

     Robert C. McDonald, Esquire                Brian J. Ferry, Esquire
     Silverman, McDonald & Friedman             Ferry Joseph, P.A.
     1523 Concord Pike, Suite 400               1521 Concord Pike, Suite 202
     Wilmington, DE 19803                       Wilmington, DE 19802

            Re:     Carl Wanamaker v. Sandra Wanamaker,
                    C.A. No. 2019-0920-LM

   Dear Counsel:

            This case arises from a dispute over the administration of the estates of the

   parties’ parents. The Petitioner seeks to have the Respondent removed as the

   personal representative of their father’s estate and wants sanctions imposed against

   the Respondent for her conduct.

            After reviewing the evidence from trial, I find the Respondent should be

   removed as the personal representative of both parents’ estates.                 Although

   Respondent has not neglected all of her duties, she has breached the fiduciary duties

   owed in her role as personal representative.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 2 of 17

I.        Background1

          This case arises from the administration of the estates of Carl E. Wanamaker,

Sr. and Sarah Wanamaker (together, the “Decedents”). On April 26, 2019, Carl

Wanamaker, Sr. died intestate in New Castle County, Delaware. 2 A little over a

month later, his spouse, Sarah Wanamaker also died intestate on May 29, 2019.3

The Decedents left behind two beneficiaries, Carl Wanamaker, Jr. (the “Petitioner”)

and Sandra Wanamaker (the “Respondent”). 4

          On June 27, 2019, the Respondent filed and was appointed as the personal

representative of Carl Wanamaker, Sr.’s estate. 5 On July 29, 2019, the Respondent

was also appointed as the personal representative of the estate of Sarah Wanamaker.6

          Throughout her time as personal representative, issues arose between the

Respondent and the Petitioner. On November 15, 2019, less than five months after

1
  The facts in this report reflect my findings based on the record developed at trial on June
6, 2023. See Docket Item (“D.I.”) 35. I grant the evidence the weight and credibility I find
it deserves. Citations to the trial transcripts are in the form “Tr. #.” The parties’ jointly
submitted exhibits are cited as “JX __.” Citations to the Register of Wills docket are cited
as “ROW” D.I.#.
2
    D.I. 34.
3
    Id.
4
    Id.
5
    Id.
6
    JX G at 1.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 3 of 17

she was appointed personal representative, the Respondent filed this action to

remove her as the personal representative of the Estate of Carl Wanamaker pursuant

to 12. Del. C. § 1541.7

          A.    The Property

          Prior to their deaths, the Decedents owned real property at 5894 Summit

Bridge Road, Townsend, Delaware (the “Property”), property at 645 South Street,

Townsend, Delaware, and property located at 649 South Street in Townsend,

Delaware (collectively the “Townsend lots”). It is undisputed that the Respondent

has resided at the Property since the date of the Decedents’ deaths.8 However, the

Respondent testified that she moved into the Property before the Decedents’ deaths,

around summer 2018,9 while the Petitioner maintains that she moved in after the

Decedents’ deaths. 10 The Respondent also testified that she has lived alone at the

Property since her parents died but has allowed the Property to be listed as the home

address for her grandchildren to allow them to attend school in Appoquinimink

School District, although they don’t reside with her in the home.11

7
    D.I. 1.
8
    D.I. 34.
9
    Tr. 70:11-16.
10
     Tr. 154:20-157:16.
11
     Tr. 17:15-19:13.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 4 of 17

         While the Respondent was living in the Property, some issues arose which

required repairs. At the end of 2019, the Property suffered from a sewer system

backup causing damages to several rooms. 12 This damage required extensive

repairs, including pipe repairs and carpet removal. 13 The well on the Property

needed to be partially replaced. 14 The Respondent also had a new hot water heater

and boiler system installed. 15 All of these repairs and improvements were paid for

from the assets of the Decedents’ estates. 16

         The Petitioner attempted to visit the property after the death of his mother. On

one occasion when the Petitioner visited the Property, the Respondent testified that

he and a friend harassed her. 17 However, the Petitioner indicates he demanded his

sister to stop driving their parent’s vehicle, which was an estate asset. 18 The

Respondent filed for a protection from abuse order (“PFA”) against the Petitioner

due to this incident.19 Although there was a temporary period where the Respondent

12
     Tr. 25:4-14.
13
     Tr. 25:17-20.
14
     Tr. 28:3-15.
15
     Tr. 29:24-30:9.
16
     Tr. 27:19-21; Tr. 30:12-13.
17
     Tr. 67:9-68:2.
18
     Tr. 161:10-162:6.
19
     Tr. 31:19-32:5; JX B.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 5 of 17

could not go on the property due to the PFA 20, the PFA was ultimately dismissed in

December 2019. 21 The Petitioner testified that he knew if he went back to the

property, she would call the cops again and attempt to get another PFA against him.22

         B.    The Vehicles

         The main assets of the Decedents’ estates were a collection of vehicles and

valuable license plates. Among these vehicles, was a 1996 Mercedes Benz (the

“Mercedes”).23 The Decedents used this as their daily car, and the Respondent

continued to use it in that manner after their death. Respondent testified that she

stopped using the Mercedes daily a couple of years ago, but occasionally uses it if

she has maintenance trouble with her vehicle, which occurred as recently as one

week before the trial.24 In order to re-register the Mercedes, the Respondent had it

titled solely in her name, despite acknowledging the Petitioner’s right to a share in

the Mercedes. 25

20
     JX B.
21
     Id.; Tr. 162:12-22; JX B.
22
     Tr. 162:23-163:3.
23
     JX F.
24
     Tr. 20:2-21:11.
25
     Tr. 22:9-23.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 6 of 17

         The Respondent worked to sell some of the Decedents’ other vehicles. The

Respondent had an appraisal of the vehicles performed by Beach Bound Auto.26 The

Respondent sold the Decedents’ 1958 Mercedes Benz 220S cabriolet, 1975

Chevrolet Caprice, 1935 Ford Model 31, and 1926 Ford Model T.27 At trial, the

Respondent testified that she could not recall the values received for these vehicles.28

The Respondent also testified that the Decedents’ 1982 Mercedes Benz 380SL

Roadster, 1993 Chevrolet Caprice, and 1990 Ford F150 remain in the yard at the

Property.29 The Respondent has also retained two low numbered license plates,

numbered 899 and 1251.30 At trial, she testified that the current balance of the

Decedents’ estate account is approximately $45,000.00, 31 which appears to be

significantly lower than the appraised value of the sold vehicles.32

26
     JX I.
27
     Tr. 52:24-54:21.
28
     Tr. 53:3-8.
29
     Tr. 55:2-56:5.
30
     Tr. 56:12-20.
31
     Tr. 57:15-22.
32
     JX J.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 7 of 17

         C.     The Administration

                      1.   Estate of Carl Wanamaker Sr.

         On June 27, 2019, the Respondent filed and was appointed as the personal

representative of Carl Wanamaker, Sr.’s estate.33 In accordance with the letters of

administration, the inventory was due on or before August 31, 2019 with the

accounting due by May 31, 2020.34 The Respondent filed an Inventory for the Estate

of Carl Wanamaker Sr. on December 11, 2019 35 after requesting a 90-day extension

on September 24, 2019.36 On June 26, 2020, approximately one month after the

accounting was due, Respondent requested a 90-day extension to file the

accounting.37 To date, no accounting has been filed for the Estate of Carl

Wannamaker Sr.

33
     D.I. 34.
34
  In the Matter of Carl E. Wanamaker Sr., ROW 172297 D.I. 4; Filings with the Register
of Wills are subject to judicial notice. Arot v. Lardani, 2018 WL 5430297, at *1 n.6 (Del.
Ch. Oct. 29, 2018) (citing 12 Del. C. § 2501; Del. R. Evid. 202(d)(1)(C)).
35
     D.I. 34; JX E.
36
     ROW Folio 172297 AF, D.I. 10.
37
     ROW Folio 172297 AF, D.I.. 15.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 8 of 17

                     2.     Estate of Sarah Wanamaker

           On July 29, 2019, the Respondent was appointed as the personal

representative of the estate of Sarah Wanamaker.38 The letters of administration

required the inventory to be filed by October 29, 2019 and the accounting to be filed

before July 29, 2020.39 On September 24, 2019, Respondent was granted a 90-day

extension to file the inventory.40 With the extension, the inventory was now due on

January 29, 2020. 41 On March 9, 2020, a little over five weeks after the inventory

was due, Respondent filed the inventory with the Register of Wills. 42 She

subsequently filed an amended inventory on September 17, 2020. 43 On June 5, 2020,

The Register of Wills sent a reminder letter to the Respondent that the accounting

was due on July 29, 2020.44 To date, no accounting has been filed, nor has an

extension been requested.

38
     JX G at 1.
39
     In the Matter of Sarah Wanamaker, ROW 172445 AF, D.I. 3.
40
     ROW Folio 172445 AF, D.I. 6.
41
     Id.
42
     ROW Folio 172445 AF, D.I. 8.
43
     JX G.; ROW Folio 172445 AF, D.I. 11.
44
     ROW Folio 172445 AF, D.I. 10.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 9 of 17

II.        Analysis

           A.   Standing

           This Petition seeks to have the Respondent removed as personal

representative of the Estate of Carl Emory Wanamaker Sr.45 When Mr. Wanamaker

passed away intestate, his assets transferred to his surviving spouse under the laws

of intestate succession. However, a little over a month later, Mrs. Sarah Wanamaker

also passed away. By law, those assets would pass to the surviving children, the

Petitioner and Respondent. At trial, the Court inquired about whether this litigation

should have been filed under the estate of Sarah Wanamaker rather than under the

estate of Carl Wanamaker Sr.46 Both parties acknowledged that the assets were

identical.47 In addition, the Respondent is the personal representative under both

estates.

           This action was originally filed on November 15, 2019, with the trial being

held on June 6, 2023. At no point between the filing of this action and the trial, did

the Respondent object to standing or request dismissal for potentially filing under

the wrong case. With more than four years since the petition was filed, it would be

45
     D.I. 1.
46
     Tr. 101:3-103:19.
47
     Id.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 10 of 17

inequitable to require the Petitioner to refile the case under the estate of Sarah

Wanamaker and put on identical evidence. Moreover, because of the obvious

overlap, I am going to consider the personal representative’s actions, which are in

question by the Petitioner, under both estates.

           B.    The Respondent breached her fiduciary duties of care and loyalty
                 to the Decedents’ estates.

           To prevail on a breach-of-fiduciary-duty claim, the Petitioner must

demonstrate two elements: “(1) that a fiduciary duty existed and (2) that

the defendant breached that duty.”48 Personal representatives of an estate owe both

a duty of care and a duty of loyalty to the estate. 49 The personal representative’s

standard of care is judged by the standard of “ordinary care, prudence, skill and

diligence” in carrying out the duties as a personal representative.50 The duty of

loyalty requires the personal representative “to act, at all times, in the best interests

of the estate.”51

           The Respondent breached her duty of care by failing to exercise reasonable

care in the administration of the estate. Respondent indicated she has not yet filed

48
     Heller v. Kiernan, 2002 WL 385545, at *3 (Del. Ch. Feb. 27, 2002).
49
     In re Est. of Newton, 2023 WL 3144700, at *3 (Del. Ch. Apr. 28, 2023).
50
     Est. of Chambers, 2020 WL 3173032, at *2 (Del. Ch. June 12, 2020).
51
     Id.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 11 of 17

accountings because of the pending litigation. Although litigation in these cases

does not preclude the filing of an accounting and it is common practice to request a

stay of the Register of Wills deadlines, such a request was not made.

         Respondent also failed to exercise reasonable care by submitting inaccurate

inventories. The Respondent testified that she took in stock dividend checks owed

to Carl Sr., but these checks were not identified on the inventory, or the amended

inventory for either of the Decedents. 52    Although she testified at trial that she

believed she has the information, the Respondent failed to provide sufficient

evidence that she kept records of expenditures from the estate account, or record

specific amounts expended.

         Notwithstanding the lack of accountings and accuracy of the inventories,

Respondent’s actions show a breach of her fiduciary duties even without the ability

to analyze transactions on an accounting. The Respondent utilized estate assets for

her personal benefit, breaching her duty of loyalty. Although her actions benefited

the estate in that she made repairs to the Property, she sold the most valuable estate

vehicles to fund repairs to maintain the home she lived in and had no intention of

selling. All, but one, of the working vehicles were sold. She chose not to sell the

52
     Tr. 43:21-45:4.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 12 of 17

Mercedes because she hoped to keep it as her second car. So, acting in her best

interest, she decided not to treat it the same as the other valuable vehicles in working

condition. She also continued to occasionally drive the Mercedes whenever it suited

her.

         Additionally, Respondent has turned the Summit Bridge Property, into her

personal asset. She has not converted this into her sole name, but she has moved in,

allowed her grandchildren to use the house as their address for school, and as

previously mentioned, sold estate assets to keep the home habitable for herself and

cover the carrying costs. Further, she testified that she has no intention of selling the

home because she wants it to go to her grandkids.53 Her testimony revealed that she

wants to split the estate assets with her brother 50/50 but wants to “come to an

agreement” on the Summit Bridge Property where she lives. 54 She believes she has

a superior claim to the home because she has children, and grandchildren, while the

Petitioner does not.55 Although the idea of keeping a home in the family because that

is what a parent would want 56, is not lost on me, the role of the fiduciary is to have

53
     Tr. 37:12-24 and Tr. 38:10-18.
54
     Tr. 124:14-22.
55
     Tr. 37:20-38:9.
56
     Tr. 38:16-18.
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 13 of 17

a duty of loyalty to the beneficiaries and not to the decedents undocumented wishes.

Respondent’s actions and feelings towards the Property continue to show the

primary purpose of her actions are for her best interest, with her duties to the

beneficiaries serving as her secondary purpose.

      The Respondent further breach her duty of loyalty by converting an asset of

the estate, the 1996 Mercedes Benz, into a personal asset. Although she explained

her rationale for retitling the Mercedes in only her name, she was aware of her

brother’s interest in the car, but still decided to solely put it in her names. In both

cases of the Property and the Mercedes, she acted in her personal interest, to the

detriment of her fellow beneficiary. This is a clear breach of her duty of loyalty.

      All these failures combine to show that the Respondent did not exercise

sufficient care in her estate administration. The Respondent’s sole priority in

administering the estate, was to maintain the property she lived in, and the one

vehicle she wanted to keep for herself.

      C.     The Respondent should be removed as personal representative of
             the Decedents’ estates under 12 Del. C. § 1541.
      12 Del. C. § 1541 provides “[i]f an executor or administrator neglects official

duties, the Court of Chancery may remove the executor or administrator from

office.” Amongst these official duties are those found in 12 Del.C. § 2301 (a):

“Every executor or administrator shall render an account of their administration to
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 14 of 17

the Court of Chancery, in money, every year from the date of their letters until the

estate is closed and a final account passed by the Court.”

         Here, it is clear and undisputed that the Respondent has failed to comply with

the statutory requirement to carry out her official duties as the personal

representative of the Decedents’ estates. The estates have been open since 2019 and

yet the Respondent has not filed a single accounting, and based on the evidence at

trial, seems woefully unprepared to do so. Respondent asserts she has not filed an

accounting due to the pending Court of Chancery litigation.57 However, even if

Respondent wanted to wait for the outcome of this litigation to file an accounting,

doing so was detrimental to both the estate and her case. Without an accounting, or

even records to present at the trial, I am unable to determine the expenditures and

whether they were justified. Therefore, I recommended the Respondent be removed

as the personal representative of the Decedents’ estates.

         D.    The Petitioner is not entitled to rental payments under 25 Del. C.
               § 702 as part of this estate action.

         The Petition requests the Court to impose sanctions upon Respondent for her

failure to properly administer the estates. Petitioner alludes to sanctions in the form

of the Respondent paying her share of rent due to her possession of the property.

57
     D.I. 34
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 15 of 17

         Delaware law provides that “if a co-tenant has exclusive possession of the

property and ousts other co-tenants, then the rental value (representing the benefit

received by the co-tenant having exclusive possession) may be set off against their

share of the sale proceeds.” 58 However, under Delaware law, the property passed

immediately to both parties in equal shares, so the Petitioner and the Respondent are

co-owners of the Property as joint tenants.59 With the property no longer part of the

estate60, I decline to make a determination on whether the Petitioner is entitled to

the payment of rent for the Respondent’s possession of the property. Such an

analysis is more appropriate for a partition matter, or if the property is to be sold,

and not the current estate dispute.61

58
     Ponder v. Willey, 2020 WL 6735715 at *3 (Del. Ch. Nov. 17, 2020).
59
  See In re Estate of Morrell, 1995 WL 783075, at *4 (Del. Ch. Dec. 26, 1995) (“[R]eal
estate, at the death of a decedent, passes directly to the intestate heirs, if there is no will,
and directly to the persons named in the will as the new owners, if there is a will.”).
60
  In re Harris’ Estate, 44 A.2d 18, 19 (Del. Orph. 1945). (“It is well settled in Delaware
that the title to real estate descends to the heirs or vests in the devisees immediately upon
the death of the testator subject to be divested if it be necessary to sell it for the payment
of debts of the deceased.”).
61
  See Green v. Shockley, 2022 WL 4589217, at *6 (Del. Ch. Sept. 30, 2022) (holding
that the only appropriate method to collect rental income “is a partition action, not the
Estate [matter].”).
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 16 of 17

         E.     The Respondent’s commission should be reduced.

         Commissions represent “compensation to the personal representative for [her]

own services in collecting the assets, checking into and paying bills, and performing

the various duties which may be necessary, and his trouble and [i]ncidental expenses

incurred thereby.”62 Per Court of Chancery Rule 192, “[c]ommissions of personal

representatives, and fees of the attorneys who represent them, shall be allowed in a

reasonable amount.” Under 12 Del. C. § 2305(c), “[t]he Court of Chancery may

reduce commissions and attorneys’ fees if the accounts required to be filed by this

chapter are not filed within the required time period.” As indicated above, the

Respondent failed to file the accountings for the Decedents’ estates with the Register

of Wills and failed to request a stay or an extension of the requirement. I recommend

the Respondent not be permitted to take the full commission for her time as personal

representative of the Decedents’ estates and any commissions be reduced by 50%.

III.     Conclusion

         For the foregoing reasons, I recommend that the Respondent be removed as

the personal representative of the Decedents’ estates. If the Petitioner seeks to be

appointed, he shall apply to through the Register of Wills within thirty days, or a

62
     In re Whiteside, 258 A.2d 279, 282 (Del. 1969).
Carl Wanamaker v. Sandra Wanamaker,
C.A. No. 2019-0920-LM
February 5, 2024
Page 17 of 17

neutral personal representative will be appointed. In addition, the Respondent shall

file an accounting for all estate expenditures within forty-five (45) days of this

order. If she fails to do so, a rule to show cause will be issued to her directing her to

appear at a hearing and show cause why a judgment should not be entered against

her. Furthermore, I recommend that the Respondent be prohibited from taking a full

commission for her time as Personal Representative.

      This is a final report under Court of Chancery Rule 143 and exceptions may

be filed under Court of Chancery Rule 144.

      IT IS SO ORDERED.

                                               /s/ Loren Mitchell

                                               Loren Mitchell

                                               Magistrate in Chancery