Veney v. United Bank ( 2017 )

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE
WARREN VENEY,
Plaintiff,
v. C.A. No. Nl7C-04-04l VLM
UNITED BANK;
ANDREW MCCULLEY;
JANE SARGENTS,
Defendants.
Submitted: August 29, 2017
Decided: August 31, 2017
ORDER
AND NOW TO WIT, this 31St day of August, 2017, upon consideration of
Defendants United Bank, Andrew McCulley, and Jane Sargents (collectively
“Defendants”)’S Motion to Dismiss, Plaintiff’s response thereto, and the parties’
positions at oral argument, IT IS HEREBY ORDERED that Defendants’ Motion
to Dismiss is GRANTED for the following reasons:
F actual and Procedural Background
l. Plaintiff Warren L. Veney, Sr., is the Settlor of the Warren L. Veney
Trust (“the trust”), a revocable inter vivos trust.l The sole beneficiaries of the trust
1 The Court Was never provided With the trust agreement in this case. The facts in this Order
derive from the Complaint and the judicially-noticed court documents from Virginia state court
that Defendants submitted in conjunction With their Motion to Dismiss.
are Plaintiff and his adult son. The trust’s corpus is substantially comprised of real
and personal property in the Commonwealth of Virginia. The trust was established
by written agreement on September 30, 1983, and has been amended on several
occasions since that time. The trust agreement contains references to Delaware
law in a manner consistent with a choice-of-law provision.2
2. Defendant United Bank (“the Bank”) administers the Trust in
Virginia. The Bank is the third successor trustee of the trust.3 Defendants
McCulley and Sargents are employees of the Bank: McCulley is a Trust Officer in
the Bank’s Virginia branch; Sargents is a Senior Vice President and Director of
Fiduciary Services for the Bank in West Virginia. The Bank, McCulley, and
Sargents have no legal presence in Delaware. Further, their alleged conduct in
connection with the trust occurred in Virginia.
3. On March 17, 2017, on motion by the Bank, the Circuit Court of
Fairfax County, Virginia, appointed Margaret A. O’Reilly, Esquire, as guardian ad
litem to represent the interests of Plaintiff under VA. CODE ANN. § 8.01-9.4 The
Virginia court found that Plaintiff is a “person under disability” as defined under
2 DRE Rule 202 Request for Judicial Notice at Ex. 2, 11 l, Veney v. United Bank, C.A. No. N17C-
04-041 (Del. Super. Aug. 10, 2017) [hereinafter Request for Judicial Notice] (“The Agreement
was executed in the State of Delaware and is subject to the laws of the State of Delaware.”).
3 The Bank has since resigned as trustee of the trust and a new, fourth trustee has been appointed
as of August 2017. The Court will refer to the Bank as trustee for the sake of clarity.
4 Request for Judicial Notice at Ex. 1, 1 2.
VA. CODE ANN. § 8.01-2(6)(e).5 According to Virginia law, this determination
means that Plaintiff is unable to defend his property or legal rights in a matter
where the Bank sought leave to resign as trustee and request the appointment of a
new trustee in its stead.6
4. Plaintiff filed his pro se Complaint in this Court on April 28, 2017.
The guardian ad litem is not listed as a representative or attorney of record. The
two-page, handwritten Complaint generally alleges claims sounding in conversion,
fraud, and accounting. He seeks the “restoration” of $2.6 million to the corpus of
the trust. He also seeks ten times that value for “mental anguish,” “theft by
deception,” “fraud,” “embezzlement,” and “conspiracy to defraud.” Further, he
seeks to have a Virginia property, presumably held in the trust, titled in his name
and the deed physically “retumed to him by parcel courier.”
5 . Defendants jointly filed this Motion to Dismiss in lieu of an Answer
on May 26, 2017. Defendants supplemented their filing with an opening brief on
June 8, 2017. Plaintiff filed a two-page response to the Motion to Dismiss on June
23, 2017. Defendants filed their reply brief on June 29, 2017. Additionally,
5 Id. See VA. CODE ANN. § 8.01-2(6)(e) (West 2017) (defining “person under disability” as
including “any [] person who, upon motion to the court by any party to an action or suit or by
any person in interest, is determined to be (i) incapable of taking proper care of his person, or (ii)
incapable of properly handling and managing his estate, or (iii) otherwise unable to defend his
property or legal rights either because of age or temporary or permanent impairment, whether
physical, mental, or both. . . .”).
6 See VA. CODE ANN. § 64.2-713 (West 2017) (describing trust proceedings under Virginia law).
3 .
Defendants filed a Request for Judicial Notice on August 10, 2017. A hearing was
held on August 29, 2017. This is the Court’s decision on Defendants’ Motion to
Dismiss.
Contentions of the Parties
6. Defendants move to dismiss the Complaint under Rule 12(b)(1)-(7).
They contend that Plaintiff is estopped from filing the present claim because he has
been adjudicated a “person with disability” in Virginia as discussed above.
Further, they argue that the Complaint fails to state a claim upon which relief can
be granted, even affording Plaintiff deference as a pro se litigant. Moreover, they
contend that: there is insufficient service of process; the Complaint fails to state
claims of fraud and civil conspiracy with particularity; the Complaint fails to plead
relevant times and places for the alleged torts; the Complaint seeks injunctive relief
outside the subject matter jurisdiction of this Court; the Complaint is time barred;
and this Court does not have personal jurisdiction over Defendants. Defendants
seek the dismissal of the Complaint with prejudice.
7. Plaintiff s two-page response to the Motion contends that dismissal is
inappropriate “[g]iven the following reason[s] indicated in my complaint.” He
proceeds to cite extraneous information outside the allegations listed in his
Complaint. Further, he maintains that he has not received any accounting of the
trust corpus and the trustee has refused his requests for an accounting of the trust.7
Standard of Review
8. On a motion to dismiss for failure to state a claim under Rule
12(b)(6), all well-pleaded allegations in the complaint must be accepted as true.8
Even vague allegations are considered well-pleaded if they give the opposing party
notice of a claim.9 The Court must draw all reasonable inferences in favor of the
non-moving party;10 however, it will not “accept conclusory allegations
unsupported by specific facts,” nor will it “draw unreasonable inferences in favor
of the non-moving party.”ll Dismissal of a complaint under Rule l2(b)(6) must be
7 The guardian acl litem’s report directly contradicts this contention: “I initially spoke to Mr.
Veney by telephone He raised numerous issues about the management of the trust assets, and
about communication between himself and the Trustee. In response to that conversation, l
requested and obtained from the Petitioner’s attorney additional financial statements including
itemized statements of expenditures and tax reporting information for the years 2001 through
April 2017. I provided all of these documents to Mr. Veney, together with the documents
[regarding the current status of the trust assets, “including a statement of assets on hand, tax
information for 2016, and a report of income and expenditures for the past year”].” Request for
Judicial Notice at Ex. 2,11 11-12.
8 Spence v. Funk, 396 A.2d 967, 968 (Del. 1978). See also DEL. SUPER. CT. CIV. R. 12(b)(6).
9 In re Gen. Motors (Hughes) S’holder Litig., 897 A.2d 162, 168 (Del. 2006) (quoting Savor, Inc.
v. FMR Corp., 812 A.2d 894, 896-97 (Del. 2002)).
10 Id.ll Price v. E.I. DuPoni de Nemours & CO., 26 A.3d 162, 166 (Del. 2011) (internal citation
omitted).
denied if the non-moving party could recover under “any reasonably conceivable
set of circumstances Susceptible of proof under the complaint.”12
Discussion
9. Because of the Complaint’s brusqueness, this Court will first address
Defendants’ Request for Judicial Notice as it supplements the limited factual
background available to the Court on Defendants’ Motion to Dismiss.
Request for J udicial Notice
10. Where extrinsic evidence is considered on a motion to dismiss, the
Court usually converts the motion to a motion for summary judgment.13 Before the
Court converts the motion, however, it must notify the parties and give them a
reasonable opportunity to present extrinsic evidence according to Rule 56.14 But, it
does not follow that the “floodgates to discovery” are open simply because an
extrinsic document is presented on a motion to dismiss15 In addition to two
12 Spence, 396 A.2d at 968 (citing Klein v. Sunbeam Corp., 94 A.2d 385 (Del. 1952)).
13 See In re Gen. Motors, 897 A.2d at 168 (citing Malpiecle v. Townson, 780 A.2d 1075, 1090
(Del. 2001)).
14 See id. at 168-69 (citations omitted).
15 Maq»iede, 780 A.2d at 1091.
recognized exceptions to the general rule,16 the Court may also take judicial notice
of “matters that are not subject to reasonable dispute.”17
11. D.R.E. 202 allows a party to request that the Court take judicial notice
of court records if the party furnishes the Court with the records and provides
sufficient notice to the other party.18 To wit, Defendants have produced three court
records from the trust litigation in Fairfax County Circuit Court in Virginia: (1) an
August 2, 2017 document entitled, “Recommendations of Guardian ad litem;” (2)
an August 3, 2017 “Report of Guardian ad litem;” and (3) an August 3, 2017
“Final Order.”19 The Court takes judicial notice, under D.R.E. 202(d)(2), of the
three documents produced. As such, they have been incorporated into this Order to
supplement the limited factual background provided in the Complaint itself.
16 Furman v. Del. Dep’t of Transp., 30 A.3d 771, 774 (Del. 2011) (citing Vanderbilt lncome &
Growih Assocs. v. Arvida/JMB Managers, 691 A.2d 609, 613 (Del. 1996)). The two exceptions
to the general rule, both inapplicable to the present Motion, are: (1) “where an extrinsic
document is integral to a plaintiffs claim and is incorporated into the complaint by reference;”
and (2) “where the document is not being relied upon to prove the truth of its contents.” Id.17 In re Gen. Motors, 897 A.2d at 169 (citing D.R.E. 201(b)).
18 D.R.E. 202(d)(2) (“Judicial notice shall be taken of each matter specified in this rule if a party
requests it, and (A) furnishes the judge sufficient information to enable him properly to comply
with the request, and (B) has given each adverse party notice thereof in the pleadings or at least
20 days before the trial. The judge, however, may permit such notice to be given at any time in
the interest of justice.”).
19 See generally Request for Judicial Notice.
Defendants’ Motion to Dismiss
12. Defendants move to dismiss the Complaint on numerous grounds
Among the myriad meritorious bases for dismissal, the Court finds that Plaintiff
fails to show Defendants are amenable to the personal jurisdiction of this Court in
accordance with 10 Del C. § 3104 and that Plaintiff has failed to plead any facts
and dates to support his vague and conclusory allegations that Defendants breached
any legal duty owed to him in accordance with Rules 8 and 9.20
13. Even under a less stringent standard afforded to pro se litigants,
Plaintiff here fails to meet the pleading requirements necessary under Delaware
law to place Defendants on notice of the alleged claims. This Court further finds
that where even the basics are lacking from this Complaint, so too does Plaintiff
fail to state claims for fraud, conspiracy, theft by deception or embezzlement
20 Plaintiff’ s guardian ad litem explained the forum issues in her report to the Virginia court1
“Mr. Veney indicated to me that he was not going to participate in the Virginia proceeding, and
had filed a separate action in Delaware which he believed to be the appropriate jurisdiction I
advised him that I believe the Virginia Court has jurisdiction to hear the Trustee’s request to
resign, although the terms of the trust would need to be interpreted in accordance with Delaware
law. The Virginia action would therefore proceed, whether he participated in it or not, and I
advised him that it was in his interest to participate.” Request for Judicial Notice at Ex. 2, 11 17.
8
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Conclusion
For the above stated reasons, Defendants’ Motion to Dismiss is GRANTED.
/
/ 111ng vivian L. wiede
IT IS SO ORDERED.
Prothonotary
All Counsel of Record (via e-filing)