Opinion
C.A. No. 99C-06-013.
Date Submitted: October 4, 1999.
Date: Decided: January 28, 2000.
James B. Tyler, III, Esquire, P.O. Box 555, Georgetown, DE 19947, attorney for plaintiffs.
Jackson R. Dunlap, Jr., Esquire, P.O. Box 742, Georgetown, DE 19947, attorney for defendant.
MEMORANDUM OPINION
This is a suit arising from a debt. Pending before the Court is a motion to dismiss, which ultimately is treated as a motion for summary judgment. The parties have submitted briefs on the pending motion, and this constitutes my decision thereon.
FACTS
On June 17, 1999, Pamintuan and Lacdao-Pamintuan, M.D., P.A., a Delaware professional services corporation; Jose C. Pamintuan; and Elvira L. Pamintuan (collectively referred to as "plaintiffs") filed this suit against Estrella Dosado. Plaintiffs allege the following in their complaint.
On May 31, 1978, Elpidio Dosado and Lydia Dosado executed a demand note in favor of Pamintuan and Lacdao-Pamintuan, M.D., P.A. Pursuant to that note, Elpidio Dosado and Lydia Dosado promised to pay, on demand, five thousand dollars ($5,000) with interest at six percent (6%) per annum.
As an aside, I note the following. Elpidio Dosado and Lydia Dosado were jointly and severally liable on this note. In addition, above the signature line is the statement: "Witness our hands and seals the day and year aforesaid." Beside the signatures of Elpidio Dosado and Lydia Dosado are the words "(SEAL)". I will assume, without deciding, that the document is under seal. See First Trust Corp., f/k/a Atlantic Resorts, Inc. v. Byers, Del. Ct. Common Pleas, C.A. No. 95-05-356, DiSabatino, C.J. (February 25, 1997) (Court found promissory note not under seal despite the word "seal" being placed by the signature line).
Elpidio Dosado and Lydia Dosado divorced in 1981. Lydia Dosado died in 1983.
Thereafter, Elpidia Dosado married Estrella Dosado.
On August 11, 1989, Elpidio Dosado executed a will. Therein, it is provided in pertinent part:
FIRST: I hereby direct my executrix hereinafter named, to pay all of my just debts, including the expenses of my last illness, funeral and burial, including a suitable plot and marker, if necessary as soon as practicable following my death, in such amount as my executrix may deem proper. I direct that all taxes due the Federal Government and the State of Delaware, including estate and inheritance taxes, are to be paid by my estate. I also direct my executrix to take special care to insure that my loan of $5,000, plus accrued interest, is repaid to my good friends, Dr. Jose and Elvira Pamintuan. [Emphasis added.]
In subsequent provisions of the, will, Elpidio Dosado explained that he was making no provision for his six (6) children, and that the rest and remainder of his estate was to go to Estrella Dosado. Finally, he appointed Estrella Dosado as the executrix of his will.
Elpidio Dosado died on September 6, 1989. His will was admitted to probate and filed with the Sussex County Register of Wills on September 11, 1989.
Estrella Dosado never filed an inventory pursuant to chapter 19 of 12 Del. C. nor did she ever pay Dr. Jose and Elvira Pamintuan the $5,000 plus accrued interest.
Plaintiffs seek judgment on the amount due on the note as of May 12, 1999, which amount totaled $11,283.56. They also seek interest in the amount of 6% per annum from May 12, 1999 until paid.
In their complaint, plaintiffs further allege that Estrella Dosado has property from which the judgment could be satisfied, that the property was about to be sold, and that Estrella Dosado was about to leave the State. Based on these allegations, plaintiffs obtained a writ of domestic attachment pursuant to 10 Del. C. § 3501.
Plaintiffs did not file a statement of claim in the form prescribed by 12 Del. C. § 2104 for the note within eight (3) months of Elpidio Dosado's death. In fact, Elvira Pamintuan states in her affidavit attached to the complaint:
This fact is established by plaintiffs' failure to respond to Estrella Dosado's request for admission to that fact. Super. Ct. Civ. R. 36. In their answering memorandum, plaintiffs reference this unanswered request for admission and admit that they did not file a proof of claim within eight (8) months of Elpidio Dosado's death. This fact which is outside of the pleadings, causes the motion to dismiss to become a motion for summary judgment. Super. Ct. Civ. R. 12(b).
[W]e had waited to collect the note in order to afford her [Estrella Dosado] a house in which to live with the expectation she would pay us when she sold the house.
Estrella Dosado has filed a motion to dismiss the complaint. She asserts the following grounds for dismissal. Plaintiffs failed to make a claim against Elpidio Dosado's estate within eight (8) months from his death, as 12 Del. C. § 2102 and § 2104 require; plaintiffs failed to produce a statement of claim as 12 Del. C. § 2104 requires, and 12 Del. C. § 3121 requires dismissal of the claim; Estrella Dosado is not an obligor on the note; and the statute of limitations set forth in 10 Del. C. § 8106 bars the claim.
In 12 Del. C. § 2102, it is provided in pertinent part as follows:
(a) All claims against a decedent's estate which arose before the death of the decedent. . . ., whether due or to become due, absolute or contingent, liquidated or unliquidated, founded on contract, tort or other legal basis, except debts of which notice is presumed pursuant to § 2103 of this title, if not barred earlier by other statute of limitations, are barred against the estate, 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 whether or not the notice referred to in § 2101 of this title has been given.
* * *
(c) Any claim not barred under subsections (a) and (b) of this section which has been rejected by an executor or administrator shall be barred forever unless an action or suit be commenced thereon within 3 months after the executor or administrator has notified the claimant of such rejection by writing delivered to the claimant in person or mailed to the claimant's last address known to the executor or administrator. . . .
In 12 Del. C. § 2104, it is provided in pertinent part:
Claims against a decedent's estate may be presented as follows:
(1) The claimant may deliver or mail to the personal representative a written statement of claim indicating its basis, the name and address of the claimant and the amount claimed, or may file a written statement of claim, in the form prescribed by rule of the Court of Chancery, with the Register of Wills. . . .
(2) The claimant may commence a proceeding against the personal representative in any court where the personal representative may be subject to jurisdiction, to obtain payment of the claim against the estate, but the commencement of the proceeding must occur within the time limited for presenting the claim.
In 21 Del. C. § 3121, it is provided:
If in an action against an executor . . . for a debt against the decedent the affidavit required by § 2104 of this title is not produced by the plaintiff, the action shall, upon motion, be dismissed. . . .
In 10 Del. C. § 8106, it is provided in pertinent part:
[N]o action to recover a debt not evidenced by a record or by an instrument under seal . . . shall be brought after the expiration of 3 years from the accruing of the cause of such action. . . .
I quote from plaintiffs' answering memorandum in order to convey their response to the pending motion:
Defendant's Motion to Dismiss seeks a determination that she not pay the Note to Plaintiffs, i.e. a blessing by this Court of her ignoring her deceased husband's formal command in his Will that she take "special care" to pay the debt to Plaintiffs, "his good friends." She also is asking the Court to approve her taking her devise of his interest in the house under the Will, now sold to generate the proceeds paid into Court, while closing her eyes to the direction to pay this debt as specially directed.
Plaintiffs argue that Estrella Dosado should have sold her home in order to pay off the debt owed them. Plaintiffs further argue that they need not have made a claim since the will directed Estrella Dosado to pay the debt owed.
DISCUSSON
Summary judgment may be granted only when no material issues of fact exist, and the moving party bears the burden of establishing the non-existence of material issues of fact. Moore v. Sizemore, Del. Supr., 405 A.2d 679, 630 (1979). Once the moving party meets its burden, then the burden shifts to the non-moving party to establish the existence of material issues of fact. Id. at 681. Where the moving party produces an affidavit or other evidence sufficient under Super. Ct. Civ. R. 56 in support of its motion and the burden shifts, then the non-moving party may not rest on its own pleadings, but must provide evidence showing a genuine issue of material fact for trial. Super. Ct. Civ. R. 56(e);Celotex Corn. v. Catrett, 477 U.S. 317, 322-23 (1986). If, after discovery, the non-moving party cannot make a sufficient showing of the existence of an essential element of his or her case, then summary judgment must be granted. Burkhart v. Davies, Del. Supr., 602 A.2d 56, 59 (1991), cert. den., 112 S.Ct. 1946 (1992);Celotex Corp. v. Catrett, supra. If however, material issues of fact exist or if the Court determines that it does not have sufficient facts to enable it to apply the law to the facts before it, then summary judgment is inappropriate. Ebersole v. Lowengrub, Del. Supr., 180 A.2d 467, 470 (1962).
Plaintiffs have stated a claim for a debt action on the note. A liberal interpretation of the complaint allows for the conclusion that plaintiffs also have attempted to assert a claim for breach of Estrella Dosado's fiduciary duties as executrix.
If the action is one on the note, then the proper plaintiff would be Pamintuan and Lacdao-Pamintuan, M.D., P.A., not Dr. Jose and Elvira Pamintuan since the parties have not presented any facts establishing an assignment of the note. However, since no one has raised this issue and since it is possible an assignment exists, I will decide this matter as if all of the plaintiffs were entitled to collect on the note and receive the repayment of the debt from the estate.
The issue before the Court is whether a suit on the note is barred by the pertinent provisions of Title 12, Del. C. The resolution of this issue is within this Court's jurisdiction. See Dellaversano v. Estate of Michael J. DiSabatino, Del. Super., C.A. No. 98C-10-002, Quillen, J. (December 23, 1998).
Plaintiffs were required, pursuant to 12 Del. C. § 2102 (a), to file a claim against Elpidio Dosado's estate within eight (8) months of Elpidio's death. If the claim was rejected, then plaintiffs were required to file suit in this Court within three months after the notification of the claim's rejection. 12 Del. C. § 2102 (c). Plaintiffs were required to file this claim even though Estrella Dosado had notice of their claim. Calvin v. Calvin, Del. Ch., C.A. No. 7964, Walsh, V.C. (August 19, 1935) at 12; Kuakini Hospital and Home v. Yamanoha, Haw. Supr., 363 P.2d 1006, 1008 (1961); 31 Am.Jur.2d, Executors and Administrators, § 601 (1989).
The statute of limitations on a note is twenty years. DiBiase v. A D, Inc., Del. Super., 351 A.2d 865, 867 (1976). However, the time limitation of 12 Del. C. § 2102 bars the claim even when the twenty year statute of limitations has not run. Brockson v. Richardson Bros., Inc., Del. Super., 24 A.2d 537, 539 (1942) ("[T]he practical effect of the statute is to bar some claims in less time than the general Statute of Limitations. . . ."); Dellaversano v. Estate of Michael J. DiSabatino, supra at 3 n. 4 ("The statute here is a nonclaim statute which bars the claim forever if not filed in a timely manner.")
I will assume, without deciding, that the twenty year statute of limitations has not run in this case.
Plaintiffs failed to file a claim within eight (8) months of Elpidio Dosado's death on September 6, 1939. Thus, their suit on the promissory note is barred. 12 Del. C. § 2102.
In construing the complaint liberally, the Court may conclude that plaintiffs are attempting to make a claim against Estrella Dosado as executor of the estate for breach of a fiduciary duty.See In re Ortiz' Estate, Del. Ch., 27 A.2d 368, 373 (1942) (executor stands in a fiduciary relation with creditors of estate) The Court makes no determination of whether plaintiffs have actually stated such a claim nor does it make a determination on the viability or merits of such a claim. If plaintiffs are making such a claim, this Court has no jurisdiction of it because suits based on fiduciary relations are within the jurisdiction of the Court of Chancery. Clark v. Teeven Holding Co., Inc., Del. Ch., 625 A.2d 869, 875 (1992), as are suits concerning the administration of estates, In re Ortiz' Estate, 27 A.2d at 373. Because Chancery Court, and not this Court, has jurisdiction over such a claim, the Court will dismiss the complaint unless plaintiffs file a motion to transfer pursuant to 10 Del. C. § 1902 within sixty (60) days of this order.
In conclusion, to the extent plaintiffs seek to recover on the note, their claim is barred. Any claim by plaintiffs against Estrella Dosado based upon her alleged failure to execute her duties as an executrix is dismissed unless plaintiffs file a motion pursuant to 10 Del. C. § 1902 to transfer the case to Chancery Court within sixty (60) days.
IT IS SO ORDERED.