Master in Chancery Finds That as Long as There is a Will Contest in Texas, the Delaware Trustee May Not Distribute the Assets

Delaware Fiduciary Litigation Blog

Posted May 13, 2013

In the matter of Trust Under the Will of Elizabeth Williams Vale for the Benefit of Frederic B. Asche, Jr., C.A. No. 7662-ML (April 29, 2013)

PNC Delaware Trust Company amended its petition for instructions in the face of an executrix of a Texas estate contending that the Trustee should distribute the Trust immediately pursuant to a Texas Probate Court Order and under the terms of a disputed power of appointment that is the subject in an ongoing will contest in a Texas court.  The contestants in that Texas action asked that the Trustee continue to hold and manage the assets until the will contest was decided.

The executrix relied upon the Probate Order which provided that the decedent’s will had been valid and executed while he was of sound mind.  Master LeGrow pointed out that this quasi-administrative proceeding was uncontested and convened without notice to the will contestants.  Because the contestants had challenged the will directly, objecting to an immediate distribution in this matter was not a direct challenge to the Texas Probate Order.  To view it otherwise, would “mean that if an independent executor attempts to gather an asset, the ownership of which is disputed, no court in the land can enter an order respecting that asset, other than the court that appointed the executor.”

Likewise, Master LeGrow determined that although the Probate Order was final for the purposes of taking an appeal, because the issue of the decedent’s testamentary capacity had not been made final by the probate order, entry of an order instructing the Trustee to hold and manage the trust assets through the pendency of the Texas will contest would not be in violation of the Full Faith and Credit Act.

This is a draft report, and exceptions have been taken.

Author(s)

Neil R. Lapinski
Director
Gordon, Fournaris & Mammarella, P.A.
Phillip Giordano
Associate
Gordon, Fournaris & Mammarella, P.A.