Opinion
C.A. No. 286-S.
December 19, 2005.
Date Submitted: August 1, 2005
Joseph A. Vansant, Esquire Tunnell Raysor, P.A. Georgetown, DE.
James C. Reed, Esquire Millsboro, DE.
Dear Counsel:
A father executes a will devising his home to one of his three sons. Soon thereafter, the father offers to change his will to devise the home to his three sons in equal shares if they make certain improvements to the home. The sons begin the requested performance, but the father dies before performance is completed; the will is left unmodified. The inheriting son, who also serves as executor under the will, asserts that he will honor the father's promise regardless. The other two brothers complete performance of the improvements, but the inheriting son then refuses to deviate from the express terms of the will. May the two brothers recover their claimed shares in their father's home? Is their claim barred by the non-claim statute because they filed their statement of claim with the Register of Wills more than six months after their father's death (but less than six months after they completed the work)? These questions are answered in this post-trial letter opinion.
I.
Andre Eaton and Kelly Eaton (the "Plaintiffs"), two brothers, seek specific performance of an alleged oral contract to make a will entered into with their brother, Rex Eaton (the "Defendant"), and their now-deceased father, Joseph Eaton.
On August 7, 2002, the father duly executed a handwritten will (the "Will") devising his home (the "Property") solely to the Defendant. During the middle of August 2002, the father orally offered to modify the terms of his Will to devise the Property to the three brothers, in equal shares, if the brothers made certain improvements to their father's home. The father's offer was never reduced to writing. The Defendant has conceded, however, that the father stated, "Fix the place up and I'll give ya's the place." Further discussions took place shortly thereafter among the brothers and their father to determine the scope of improvements requested. It was ultimately decided that substantial improvements to the exterior of the home would be made. The primary purpose was the installation of a new roof over the father's home, but new windows, a door, soffit, siding, and a wall were to be added as well. The father wanted his home to be improved to a level commensurate with neighboring homes.
Pls.' Ex. 1. The decedent's home is located at 203 Longleaf Road, Dagsboro, Delaware 19939.
Pls.' Ex. 4 ("Letter of Rejection to Statement of Claim B-6"). This letter was mailed to the Plaintiffs by the Defendant in his capacity as executor of the estate.
At trial, the parties demonstrated a belief that ownership of a portion of the decedent's structure may have remained in Plaintiff Kelly Eaton, who had owned the trailer that comprised one-half of the decedent's home (the other half having been built as an addition to the trailer). The evidence indicated that, as part of the agreement reached among the brothers and the father, Kelly Eaton was to give any interest that he held to his father. The trailer, however, having already become a fixture to the land, passed with the devise of the lot.
Application for a building permit for construction of a new roof for the father's home, signed by the father, was submitted shortly after the offer was made, and the permit was issued on August 30, 2002. Work on the Property commenced in early September 2002. Construction of the new roof took place over a period of roughly two-and-one-half weeks that September. All three brothers contributed significant time and labor to the effort. The expenses of the roof project were shared equally among the three brothers and their father and totaled approximately $4,000.00. Improvements continued to be made to the Property, but at a slower pace. The Defendant installed new windows for which the Plaintiffs contributed part of the cost.
See Pls.' Ex. 5.
The father died on March 27, 2003, before the agreed upon work was completed and less than a year after making the offer to his sons. The August 2002 Will was admitted to probate, and the Defendant was appointed executor and granted Letters Testamentary on April 14, 2003. The father had left unchanged the terms of his Will, which, thus, failed to reflect the offer that he made. Instead, the Will, as probated, retained its original provision devising the Property, in its entirety, to the Defendant.
See Pls.' Ex. 2 (Register's Order).
There remains some question as to when the Defendant learned that the Will had not been revised.
The Plaintiffs continued with the improvements to the Property after their father's death, replacing a door, wall, and additional windows and adding soffit and siding to the home. The Defendant was fully aware that these improvements were ongoing and made a key to the premises for each of the Plaintiffs after the father's death so they could have access to the home. In his trial testimony, the Defendant acknowledged that he had observed the improvements personally, having stopped by the Property on his way to go fishing. He spoke with the Plaintiffs at this time and understood that they were attempting to satisfy the terms of their father's offer with respect to the Property.
At no time during the course of these improvements after the father's death did the Defendant indicate that he would deviate from the terms of the father's offer — nor did he help with the improvements. Indeed, to the contrary, the Defendant made affirmative statements to the Plaintiffs that he would honor the terms of their father's offer.
Approximately two to three months after their father's death, the Plaintiffs completed the improvements. At that time, however, the Defendant indicated that he would no longer adhere to the terms of the father's offer; instead, the Defendant stated that, as executor of the estate, he would only recognize the express terms of their father's Will, which made no mention of the offer to divide the Property equally in return for the improvements.
The Plaintiffs filed statements of claim to assert their interest in the Property on November 12, 2003 — roughly seven-and-one-half months after their father's death. The Defendant, in his capacity as Executor of his father's estate, then rejected the Plaintiffs' claims.
See 12 Del.C. § 2104.
See Def.'s 1 (Plaintiffs' Statements of Claim).
See Pls.' 4 ("Letter of Rejection to Statement of Claim B-6," dated December 3, 2003). The Defendant rejected the claim in part because "it was a verbal agreement, there is no written document. . . ." Id.
II.
The Plaintiffs rely on four alternate grounds: (1) specific performance of the contract to make a will, (2) imposition of a constructive trust on the Property, (3) imposition of a resulting trust on the Property, and (4) damages resulting from breach of the contract to make a will. Because I find the Plaintiffs' claim for specific performance succeeds on the merits, I address only their first claim: analysis of the remainder of the Plaintiffs' claims thus is unnecessary.III.
The Plaintiffs contend that, by failing to alter his Will to devise the Property in equal shares to each of the three brothers, their father breached a contract to make a will — one arising from their father's offer for a unilateral contract to be accepted through performance of the requested work. The Plaintiffs seek specific performance of the contract, as remedy for its breach, in order to confer upon the Plaintiffs each a one-third share in the Property.Delaware case law recognizes the validity of contracts to make a will. Moreover, other than the heightened elements of scrutiny described below, general principles of contract law are applied in determining the enforceability of such agreements. The traditional requirements of offer, acceptance, and consideration, therefore, must be satisfied. A party attempting to enforce a contract to make a will must always appreciate, however, that the law looks askance at such contracts, with probate law serving as the preferred means of devising property. As a consequence, the party seeking enforcement of the alleged contract "must show clear and convincing evidence the parties entered into a legally binding agreement." Thus, it is the "clear and convincing" standard that applies in determining both the existence and the terms of an alleged contract to make a will.
See In re Sparks, 1981 WL 88261, at *3 (Del.Ch. Sept. 1, 1981) ("There is no dispute that contracts to make a will are recognized under Delaware law. . . .").
See Hughes, 1995 WL 632018, at *3; 1 Page on Wills, §§ 10.1, 10.4-10.9 ("[S]uch a contract is held to be valid and enforceable, if it possesses the other elements of a valid contract." (footnotes omitted)).
See Hughes, 1995 WL 632018, at *3 ("The essential elements to a contract are all present: (1) a promise on the part of one party to act or refrain from acting in a given way; (2) offered to another, in a manner in which a reasonable observer would conclude the first party intended to be bound by acceptance, in exchange for; (3) some consideration flowing to the first party or to another; (4) which is unconditionally accepted by the second party in the terms of the offer, which may include (a) a verbal act of acceptance; and (b) performance of the sought-after act.").
In re Sparks, 1981 WL 88261, at *2 (explaining that contracts to make a will are "viewed . . . with suspicion and misgivings" given that "these cases arise after death has silenced the only person who actually knows the decedent's true intent"); In re Estate of Smith, 1986 WL 4873, at *4; Rash v. Equitable Trust Co., 159 A. 839, 840 (Del.Super. 1931) (explaining that "claims of this nature against dead men's estates, resting entirely in parol, based largely upon loose declarations . . . and when the lips of the party principally interested are closed in death, require the closest and most careful scrutiny to prevent injustice being done").
Hughes, 1995 WL 632018, at *3 (citing Hunter v. Diocese of Wilmington, 1987 WL 15555 (Del.Ch. Aug. 4, 1987) (defining "promise" as "a manifestation of intention to act . . . in a specific way so made as to justify . . . [an] understanding that a commitment has been made.")).
See In re Maull, 1994 WL 374302, at *3 (Del.Ch. June 9, 1994) ("A court of equity will enforce a contract to make a will as long as the contract is clearly proved and there is sufficient consideration."); Mazzetti v. Shepherd, 1986 WL 9199, at *4 (Del.Ch. Aug. 26, 1986) (holding that plaintiff must "clearly prove the existence of the promise and he must also establish that the terms of the agreement are both certain and unambiguous"); Equitable Trust Co., 49 A.2d at 327 (Del. 1946) ("[I]n order to be [enforceable], the contract must be clearly proved and must be certain and unambiguous in all its terms. . . .").
The Plaintiffs also face the added burden of attempting to prove the existence and terms of an oral contract, because specific performance of oral contracts carries attendant policy concerns. Indeed, "a written will executed with the formalities [required under statute] is a document of great dignity and not to be deviated from lightly." Therefore, "[g]enerally, under . . . Delaware's Statute of Frauds, oral promises to make a will are unenforceable." Yet, courts have not been entirely unwilling to employ principles of equity in recognizing an exception to the Statute of Frauds in this context. It is now well-settled that "[a] court may enforce a partly performed oral contract [to make a will] upon proof of clear and convincing evidence of actual part performance," where the elements described above are also met. In addition, it must be established that such performance "occurred in reliance on the oral agreement, suggesting a quid pro quo arrangement."
Shepherd v. Mazzetti, 545 A.2d 621, 623 (Del. 1988).
Boush v. Hodges, 1996 WL 652762, at *6 (Del.Ch. Nov. 6, 1996), aff'd 705 A.2d 243 (Del. 1998); see also Quillen v. Sayers, 482 A.2d 744, 747 (Del. 1984). The statute of frauds appears at 6 Del. C. § 2714(a) 2715.
See Shepherd, 545 A.2d at 623 ("However, in law there are few absolutes without exceptions, and the statute of frauds is but one example.").
Hughes, 1995 WL 632018, at *2; see also Shepherd, 545 A.2d at 623; Boush, 1996 WL 652762, at *6.
Boush, 1996 WL 652762, at *6. In Boush, the court also noted that "the plaintiff must show that such an agreement or exchange of promises was made prior to the rendering of services." Id. This appears directed at the question of whether consideration exists, or whether the performance was performed under a pre-existing duty or otherwise gratuitous — certainly a concern in the familial context.
IV.
With the above concepts in mind, I now address whether the Plaintiffs have, in fact, satisfied their "heavy burden" of proof in order to obtain their requested remedy — a difficult but not insurmountable obstacle.In this case, there exists no doubt that an agreement was reached by the deceased father and his three sons. The parties' conduct both before and after the father's death is entirely consistent with the understanding that if they made improvements to the roof, as well as the windows, door, siding, soffit, and wall, the "place" would be divided equally among the brothers at their father's death. Normally, conduct in a familial context raises questions as to whether work was performed gratuitously. Without question, the brothers were partially motivated by a desire to see their elderly father well-housed; however, the improvements, involving substantial contributions of money and labor, were clearly conducted pursuant to an agreement regarding equal distribution of the Property. This is consistent with the testimony of both the Plaintiffs and the Defendant. Furthermore, the father was involved in the project, as indicated not only by trial testimony and his contributions of money, but also by his signature on the application for the building permit. Moreover, the Defendant has conceded, in both his testimony and his letter rejecting the Plaintiffs' Statements of Claim, that an offer was made by the father to his sons with respect to the division of the Property. Further evidence is the post-death conduct of the Plaintiffs. Indeed, the continued performance of improvements, with the knowledge and acquiescence of the Defendant, is strongly persuasive that an offer for unilateral contract, capable of acceptance by performance of the requested improvements, existed, and that the Plaintiffs' work was performed pursuant to it.
See, e.g., Restatement (Second) of Contracts, § 19, comment (a) (describing concerns arising from claims against decedent's estate for services rendered). Comment (a) provides that "[i]n such cases the line between a contractual claim based on agreement and a quasi-contractual claim based on unjust enrichment is often indistinct; on either basis a major question may be whether the services were rendered gratuitously, and the circumstances are often critical." Id.
Cf. Industrial America, Inc. v. Fulton Indus., Inc., 285 A.2d 412, 415 (Del. 1971) ("There may be primary and secondary reasons or motives for a performance constituting manifestation of assent to an offer inviting acceptance by performance; and the `chief reason' or the prevailing motive need not necessarily be the offer itself.").
Payments by the father, as well as his signature on the building permit application, demonstrate a "joint act" sufficient to relieve concerns that the work was merely gratuitous. See Shepherd v. Niles, 125 A. 669 (Del.Ch. 1924) (addressing requirements of joint act and evidence of mutual assent as proof that part performance is not gratuitous); see also Equitable Trust, 49 A.2d at 328 (holding that acts by plaintiff "suggest[ed] something more than mere gifts").
In his testimony, the Defendant indicated that the reasoning underlying his rejection, as executor, of the Plaintiffs' claims was that no agreement had been entered into because it was merely verbal and the parties had not shaken hands on it. Indeed, the Defendant, conceded that the offer had been made by their father — he merely disputes its characterization as an agreement on the grounds that it was oral and the parties had not shaken hands on it. See also Pls.' Ex. 4 (Def.'s Letter of Rejection of Claims: "Furthermore [the existence of the offer is] totally irrelevant because it was a verbal agreement, there is no written document stating this said proposition. . . ."). Of course, merely because the agreement was in part oral does not necessarily preclude its enforcement.
Because I therefore am persuaded that clear and convincing evidence demonstrates that an offer for unilateral contract was made to the sons by their father, I must now determine the terms of that offer. Testimony at trial indicated that, although a new roof was the primary concern of the father, discussions between the brothers and their father at the outset of construction eventually culminated in an agreement to install not only the roof but also siding, windows, soffit, a wall, and door. The father wanted to bring his home up to a standard consistent with neighboring properties. While the Defendant testified that the scope of improvements also included repairs to the inside of the father's home, no corroboration was offered for such an expansion of the scope of the agreed-upon work. To the contrary, the behavior of the parties, continuing improvements until the exterior of the home was modernized, is fully consistent with the testimony of both the Plaintiffs and the Defendants. While I also acknowledge that the Plaintiffs testified that their father had requested only installation of a roof in return for his devise of the Property to the brothers in equal shares, the totality of the evidence presented indicates that, during the course of discussions prior to the commencement of work, the scope of requested work ultimately included the other improvements to the exterior mentioned above. Indeed, the Defendant's behavior after the father's death, permitting Plaintiffs to continue work on the house, corroborates not only the existence of an oral agreement, but also the terms set out above.
Also at trial, the Defendant unpersuasively testified to his belief that his father was only referring to his trailer, and not the land on which it stands, when he said "the place." It was the Defendant's contention that, when the father said, "fix the place up and I'll give ya's the place," he meant only the home (i.e., the improvements). In fact, later testimony by the Defendant regarding whom he believed owned the trailer contradicted these statements. I find "the place," therefore, to have referred to the entire Property.
The only remaining element that must be found to exist is actual part performance of the requested work. At trial, the Plaintiffs presented clear and convincing evidence establishing that they had completed the improvements requested by their father. Installation of the new roof took place in the month following the initial discussions of the arrangement in August 2002. Work continued during the remaining few months of the father's life, with the installation of replacement windows, and was completed approximately two to three months following his death in late March 2003. By the time work was completed, siding, additional windows, a door, wall, and soffit had also been installed on the home, as agreed upon. This work, in addition, satisfies the legal requirement of consideration; and its scope, timing, and expense indicates it was performed according to a quid pro quo arrangement (thereby mitigating any concern the work may have been gratuitous).
See Pls.' Ex. 9. Cf. Quillen, 482 A.2d at 747 ("Part performance may be deemed to take a contract out of the provision of the statute of frauds on the theory that acts of performance, even if incomplete, constitute substantial evidence that a contract actually exists.").
While the value of the Plaintiffs' work is not commensurate with the value of the interests in the Property they will receive if they succeed in their claims, the relative amount of consideration tendered is of no concern here — only its legal adequacy.
Therefore, I find the Plaintiffs to have met their burden of showing an enforceable oral contract to make a Will, the terms of which were that if the brothers performed the improvements to the exterior of their father's house described above, he would change his Will to devise the Property in equal shares to each of them. As I explained above, an oral contract to make a will necessarily involves several elements of proof with which the law displays understandable discomfort. As a result, the evidentiary requirements are substantially heightened in order to avoid the potential for fraud on the court, as well as frustration of testator intent. Nevertheless, contracts to make a will are a valid (though disfavored) means of transferring a decedent's property. As a consequence, where the contract has been proved to the extent sufficient to relieve the court of its policy concerns, its enforcement must follow, provided no other legal impediments exist.
V.
I note that contracts, such as the one presented here, implicate special concerns for the court in addition to those listed above. Foremost among them is the potential to obstruct the prompt settlement of decedents' estates — a clear policy goal of our statutory law. Nevertheless, where such contracts survive intense scrutiny by the court and are otherwise enforceable, it becomes incumbent on the court to give effect to the terms of contract — a remedy foreseeable at the time of contract. While such concerns might alter the balance of the equities under different facts, they constitute no impediment here.
This concern is substantially alleviated, however, by the implicit requirement that performance occur within a reasonable time, if not otherwise stated. See Part VI, below.
It is reassuring that the testimony of the parties, as well as the exhibits submitted, not only corroborates, but virtually mandates the finding of the existence and terms of the contract. That the Defendant, in both his testimony and an exhibit he authored, did not deny the existence of the offer — and quibbled only slightly over its terms, but to the Plaintiffs' advantage — engenders confidence in this result. The parties' conduct during their father's life is consistent with the finding; and, most importantly, the parties' conduct in the months following their father's death is consistent with the terms of the offer. The Defendant acknowledges that he observed the Plaintiffs continuing their work while he was on his way to go fishing and was aware they were performing under their view of their father's offer. Significantly, the Defendant did nothing at that time to disabuse the Plaintiffs of their belief that, as executor, he would honor the contract, too; indeed, credible testimony was presented that the parties had even discussed the project among themselves following their father's death, agreeing that it would continue in accordance with the terms of the offer. Taken together, these facts clearly satisfy the requirements for demonstrating an enforceable oral contract to make a will.
VI.
The Plaintiffs, therefore, have satisfied their burden with respect to the preliminary questions permitting enforcement of this oral contract to make a will. In order to recover under specific performance, however, the Plaintiffs must have complied with the requirements for filing of claims (or must demonstrate applicability of an exception to such requirements). The primary question to be answered, then, is whether the Plaintiffs' claim is barred under the Non-Claim Statute. Resolution of this issue will ultimately depend on when the Plaintiffs' claim arose.
In his defense, the Defendant contends that the Plaintiffs ran afoul of Delaware's Non-Claim Statute. The Defendant relies on the fact that the Plaintiffs filed their statements of claim on November 12, 2003 — roughly seven-and-one-half months after their father's death. Under 12 Del. C. § 2102, claimants must file a statement of claim within certain statutorily provided time limits. If the claim arose before death, the claim is barred if the statement of claim is not filed within eight months of death; if the claim arose at or after death, the claim is barred if proof is not filed within six months after the claim arose.
12 Del. C. § 2102(a) ("All claims against a decedent's estate which arose before the death of the decedent . . ., if not barred earlier by other statute of limitations, are barred against the estate, the personal representative and the heirs and devisees of the decedent unless presented as provided in § 2104 of this title within 8 months of the decedent's death . . .").
12 Del.C. § 2102(b) ("All claims against a decedent's estate which arise at or after the death of the decedent . . ., unless presented in accordance with § 2104 of this title, are barred against the estate, the personal representatives and the heirs and devisees of the decedent, as follows: (a) A claim based on a contract with the personal representative, within 6 months after performance by the personal representative is due; (b) Any other claim, within 6 months after it arises.").
This statute is intended to effectuate public policy favoring prompt settlement of estates. See, e.g., Estate of Stetter, 1996 WL 162256, at *3 (Del.Ch. Mar. 1, 1996) ("There is a strong public policy interest in settling estates in a timely fashion. That is why there is a definite time period during which challenges may be filed and also why there are definite limitations on the period during which claims may be made against an estate.").
Typically, a claim for breach of a contract to make a will arises at the death of the party offering to make the will. The reasoning underlying this rule is persuasive. A testator may, at least theoretically, amend his will at any time prior to his death. Therefore, even though the other party may have fully performed, breach is generally deemed not to occur until the will takes legal effect on the testor's death, at which point it is certain that further modification of the will cannot occur. Indeed, this was the conclusion of Justice Holmes, who, while serving as Chief Justice of the Supreme Court of Massachusetts, wrote that generally in actions for breach of a contract to make a will, the "cause of action [does] not arise until the death of the [testator] without having [complied with the terms of the contract], because only then was there a breach of contract. . . ."
This letter opinion does not address the potential for anticipatory breach by the testator.
Morrissey v. Morrissey, 62 N.E. 972, 973 (Mass. 1902) (Holmes, C.J.); see also Estate of Stetter, 1996 WL 162256.
In the instance of a unilateral contract, the general rule described above applies with equal force where performance is complete by, or at the time of, death of the testator. The general rule, however, does not apply without exception. Were the general rule applicable to the present facts, the Plaintiffs' cause of action for breach would have arisen at the death of their father, and the Plaintiffs' date of filing of the proof of claim would thereby have exceeded the six-month time limit established by 12 Del. C. § 2102(b).
See, e.g., Estate of Stetter, 1996 WL 162256. In Estate of Stetter, the court apparently viewed the plaintiff's contract to make a will in exchange for lifetime personal services under the lens of bilateral contract principles. Only a slight variation in the facts alleged, however, could have easily re-characterized the agreement as one in the unilateral mode — though the distinction would not have affected the outcome of the case ( i.e., the claim under contract for personal services necessarily arose at the testator's death). Therein lies the distinction between the facts of the present case and the more typical case of a contract to make a will involving performance of lifetime services for the testator.
Although the father was ill before his death, the evidence is insufficient to determine that this absolutely precluded the father from revising his Will. Therefore, any theoretical potential argument that the claim arose prior to the father death, which would implicate 12 Del.C. § 2102(a)'s eight-month period of limitations, is unavailing.
I also note the analysis employed in Tunnell v. Kreer, 1978 WL 22458 (Del.Ch. June 15, 1978). In Tunnell, the Court ruled that a claim for quantum meruit did not arise until "the date letters testamentary were granted and the will admitted to probate." Id. at *2. On similar facts as these, the plaintiff in that case had brought her claim after it was discovered that the decedent had failed to amend her will to provide for the plaintiff, as promised, in return for certain services rendered to the decedent. The Court ruled that the six months for filing of a statement of claim did not begin to run at the date of death, because "it was not the death of the testatrix which revealed the breach of the alleged understanding. Rather, it was the revelation derived from the formal probate of [the will] which made no provision for plaintiff." Id. Thus, the Court applied a type of "discovery rule" for the running of the non-claim statute. That, however, may not be a favored approach. See, e.g., Estate of Stetter, 1996 WL 162256; Shuttleworth v. Abramo, 1991 WL 160260, at *6 (Del.Ch. Aug. 15, 1991). In any event, the Plaintiffs tendered their statements of claim more than six months after the Will was probated.
At trial, the Plaintiffs pressed their theory that a unilateral contract arose by the Plaintiffs' successful completion of the work requested by their father. Therefore, I employ the principles of unilateral contract to frame my analysis of their claim. Under the Restatement (Second) of Contracts, an offer may be accepted, unless the offeror provides otherwise, by performance of the act requested. In such an instance, beginning the requested performance is deemed acceptance of the offer and, provided consideration exists, a contract is formed. Where an offer may only be accepted through performance (the terms or circumstances indicating a return promise would be insufficient), then only completed performance of the requested act will be deemed acceptance such that a contract arises. In the latter instance, however, commencement of performance under the offer by the offeree creates an "option contract" binding the offeror such that the offer must remain available for a reasonable period, unless otherwise specified, for the offeree to accept through performance of the requested act. Significantly, in that case, the offeror has no duty to perform under his offer until completion of the requested act — acceptance and full performance thereby occurring simultaneously. In other words, the offeror has no reciprocal, binding duty to perform until the requested work is finished.
I acknowledge the reluctance of the drafters of the Restatement (Second) of Contracts to employ the term "unilateral" (contrary to the drafters' method in the Restatement (First)), but use of the term remains recognized and is efficient for my analysis here. See 2 Samuel Williston Richard A. Lord, A Treatise on the Law of Contracts § 6:2 (4th ed. 1991) [hereinafter Williston on Contracts]; In re Estate of Hunter, 1994 WL 273947, at *5 (Del.Ch. June 10, 1994) (analyzing claim "in terms of bilateral and unilateral contracts").
See Restatement (Second) of Contracts, §§ 30 ("Form of Acceptance Invited"), 62 ("Effect of Performance by Offeree Where Offer Invites Either Performance or Promise"), 50 ("Acceptance of Offer Defined, Acceptance by Performance . . .").
This is referred to as an "offer for a unilateral contract." See id. § 45, comment (a). The Restatement (Second) contains the presumption that an offer may be accepted through either a return promise or performance. See id. at § 32 ("Invitation of Promise or Performance"). This is contrary to the presumption of the Restatement (First), which provided that an invitation of acceptance by return promise was to be the default presumption. See 2 Williston on Contracts, § 6:26.
Nevertheless, the offeror is the "master of his offer" and may specify that acceptance may only occur through performance. See Restatement (Second) § 60 ("Acceptance of Offer Which States . . . Manner of Acceptance"), 58 ("Necessity of Acceptance Complying with Terms of Offer"). Moreover, the language and circumstances of the offer are to be considered in determining the manner of acceptance required. See id. at § 30(2). The facts of this case, set forth above, in addition to the Plaintiffs' reliance on a theory of unilateral contract, are at odds with the normal assumption that offers not providing otherwise may be accepted either by return promise or by the commencement of performance, at the offeree's election. See id. at § 32. The language of, and circumstances surrounding, the offer clearly required performance in order for acceptance to occur, and thereby create a binding contract. This conclusion is supported by comment (b) to § 32, which provides that "[l]anguage or circumstances sometimes make it clear" that performance is the required means of acceptance. Indeed, the comment lists "[n]oncommercial arrangements among relatives and friends" as an example of circumstances in which such a presumption may arise. See also id. at § 45, comment (a). The father's offer for unilateral contract therefore invited acceptance only through completed performance of the requested work, and it was understood that the father's duty to change his will would not arise until completion of such work.
See 2 Williston on Contracts, § 6:31 ("[I]f the offeror clearly seeks . . . a performance, the offeree may accept only by complying with the terms of the offer."). This creation of contract, of course, assumes that consideration exists — normally, the performance constitutes consideration, as well.
I note that a much earlier Delaware decision, Abbott v. Stephany Poultry Co., 62 A.2d 243 (Del.Super. 1948), arguably does not recognize the exception to the general rule regarding the time of acceptance and contract explained in the text above. The court in Stephany Poultry held that the plaintiff, "by partly performing [the defendant's] open offer . . . converted it from a unilateral into a binding bilateral agreement under which [the defendant] is liable . . ." Id. at 248. This result was reached in derogation of, and as a reaction to, strict application of the then-traditional "principal of law peculiar to unilateral contracts — that is, to treat them as offers calling for completed acts and, so long as the required act remains but partially performed, then subject to the right of cancellation by the offeror . . .," application of which the court believed would cause an inequitable result. Id. at 246; see also 1 Williston on Contracts, § 5:13. This is not the modern view, however, since finding the beginning of performance to create an "option contract," as described in the text above, alleviates the concerns over potential injustice referenced by the court in Stephany Poultry without attendant doctrinal complications. See id. Cf. Marvel v. Dannemann, 490 F.Supp. 170, 175 (D. Del. 1980) (acknowledging rule of Restatement (Second), but not resolving precisely this issue).
Restatement (Second) of Contracts at § 45 ("Option Contract Created By Part Performance Or Tender"). Section 45 provides:
(1) Where an offer invites an offeree to accept by rendering a performance and does not invite a promissory acceptance, an option contract is created when the offeree tenders or begins the invited performance or tenders a beginning of it.
(2) The offeror's duty of performance under any option contract so created is conditional on completion or tender of the invited performance in accordance with the terms of the offer.See also id. at § 41 ("Lapse of Time").
Restatement (Second) of Contracts at § 45. Comment (e) states that "[t]he offeror alone is bound [by part performance or tender by the offeree], but his duty of performance is conditional on completion of the offeree's performance." Id.
But see id. at § 45, comment (e) ("The offeror alone is bound, but his duty of performance is conditional on completion of the offeree's performance. . . . But the condition may be excused, for example, if the offeror prevents performance, waives it, or repudiates."). The Defendant offered testimony of Joan Clark that the father had changed his mind about modifying his Will. The testimony, however, was uncorroborated. Furthermore, even if accepted as true, it fails to demonstrate an intent to repudiate the oral agreement (assuming, for these purposes, repudiation was a possibility).
Furthermore, this case presents the unusual circumstance of when power of acceptance in the offeree is not terminated as a necessary consequence of the death of the offeror, as would be the case otherwise. The Restatement (Second) provides that where an offeree has begun performance of the requested act prior to the death of the offeror, power of acceptance will not terminate in the offeree. On the contrary, he may continue to perform even after the death of the offeror, with (post-death) completion of the requested act constituting valid acceptance of the offer — thereby causing, for the offeree, an enforceable claim in contract to arise. This rule is not without exceptions, however: work performed prior to the death of the offeror must amount to more than "mere preparations" to perform, and the requested act(s) must ultimately be completed within a reasonable time. Nevertheless, in sum, performance begun during the lifetime of the offeror — being more than "mere preparations" to perform — and completed within a reasonable time will create a valid claim on completion of the requested work. Such is the case here.
See id. at § 48 ("Death Or Incapacity Of Offeror Or Offeree"). Were the exception described in the text that follows not available, then, since acceptance of the father's offer for unilateral contract could occur only on completion of the work requested, the Plaintiffs' power to accept their father's offer would have terminated with his death and no contract would have been formed.
See id. at § 37 ("Termination Of Power Of Acceptance Under Option Contract").
See id. at § 45, comment (f) ("What is begun or tendered must be part of the actual performance invited in order to preclude revocation under this Section. Beginning preparations, though they may be essential to carrying out the contract or to accepting the offer, is not enough.").
See id. at § 41. It should be noted that the "mere preparations" and "reasonable time" exceptions described here apply not just to the narrow case of death of the offeror, but to the more general case of the special "option contract" described in the previous passages, as well.
The father requested that his sons make certain improvements to his home and, if such work was completed, he promised to modify his Will to devise the Property to each of the sons in equal shares. The sons did, in fact, perform a significant portion of the requested work within a month of the initial offer. Improvements to the home continued until roughly three months after the father's death, at which time the work was completed according to the terms of the agreement. Furthermore, performance of the requested act was accomplished within a reasonable time — testimony at trial made it clear that the father's death coming so soon on the heels of the August 2002 offer was unexpected, at least as of that date. Indeed, were it not for the father's untimely death soon after commencement of the work, the doctrinal implications of this case would be far less difficult to parse — either the duties arising under the contract would presumably have been performed by both the sons and their father, or, in the alternative, the case would involve the typical analysis of a claim arising at death.
I stress that the circumstances of this case compel an equitable result that might not frequently obtain otherwise. The existence of an option in the offeree, described above, to complete the requested performance, though overriding termination of the offeree's power of acceptance that would otherwise occur on the death of the offeror, does not override such termination for the failure of any "condition of acceptance" under the terms of such offer.
Compare id. at § 36 with id. at § 37; see also § 48, comment (d). Comment (b) to § 36 provides that "[a] condition of acceptance, like a condition, may be express or implied in fact or constructive."
In the mill run of cases, prevailing on an option to perform surviving death of the offeror, in the context of contracts to make a will, would likely not be an easy challenge for a plaintiff. On the contrary, it may be that courts, finding themselves confronted with contracts to make a will arising out of the familial, non-commercial setting, would find, as an implied condition of acceptance, that performance must be completed during the life of the offeror in order that the offeror may enjoy the fruits of the bargain. Indeed, the rationale underlying the option to accept an offer for unilateral contract may be more apparent when applied in a commercial context. Yet, evidence at trial indicated that the father's intent in making his offer was not merely to obtain certain improvements to his home. For example, the family had experienced strained relations, and it was apparently the father's hope that this family project would heal wounds between not only father and son, but among the brothers, as well. Although this litigation is not indicative of success in that regard, such an intent in the father at the time of offer makes implication of a condition of acceptance that performance be complete by the father's death inappropriate.
Equally significant, however, is the father's passing soon after the making of the offer for unilateral contract. Had his death in so short a span been foreseen, then implication of the additional condition of acceptance would perhaps have been warranted. Because the brothers performed with reasonable diligence under the circumstances, however, it would be inequitable to deny them the option where a significant portion of the requested work, involving substantial outlays of time and money, had been accomplished before their father's death and the remainder of the work was completed shortly thereafter. Therefore, under these facts, the Plaintiffs may take advantage of an option arising to complete performance under the offer for unilateral contract, thereby permitting them to impose a duty on the Defendant to perform, even and necessarily after the father's death.
This obligation reaches the Defendant in both his individual capacity and as Executor. As successor to his father's interest in the Property, he acquired it, burdened as it was, by the commitments of his father. Although one can conceive of instances where the separate capacities might give rise to conceptual difficulties, those possibilities are not present here because the Defendant was party to the agreement under which the work was to be performed and because his post-death conduct recognized and may fairly be deemed to have ratified the agreement, one that he may not now disclaim.
Therefore, only on completion of the work did the obligation of the individual "standing in the father's shoes" arise to perform according to the terms of the contract — i.e., only at that time could the Plaintiffs' claim be fairly said to have arisen, thus commencing the running of the six month time limit under the Non-Claim Statute. In this case, the father died on March 27, 2003. The work was finished two or three months after their father's death. The Plaintiffs filed statements of claim on November 12, 2003, which, under even the most conservative calculation, was within the six-month window allowed by 12 Del.C. § 2102(b)(2). Therefore, the Plaintiffs' claim for breach of contract is not time barred.
Though the non-claim statute is a statute of repose intended to provide certainty in the administration of estates, its terms dictate this result.
VII.
Accordingly, the Plaintiffs have prevailed on Count I of their Complaint. The Plaintiffs are entitled to specific performance of the terms of the contract, as outlined above. The Defendant is directed to convey title to the Property in fee simple to each of the Plaintiffs and the Defendant in equal shares as tenants in common.