Estate of Burke v. Burke, 48, 2017

Edward J. Burke (decedent) executed a Will leaving his home (the Property) to a trust for his wife Mildred (trustee), with net sale proceeds ultimately to be distributed to his children after specified liferent and uses.
Burke sold the Property in July 2012 and deposited the sale proceeds into a bank account titled in his name.
Burke executed a durable power of attorney naming Mildred as attorney-in-fact in 1998; after his health declined, Mildred used the POA to retitle accounts to include her name, including the account holding the sale proceeds.
Burke died in October 2013; Mildred was the residuary beneficiary and sole beneficiary of the estate.
Kevin Burke (son) sued, alleging Mildred breached fiduciary duties under the POA, sought invalidation of account transfers, an accounting, and imposition of a constructive trust; the Court of Chancery granted summary judgment to Mildred, finding the devise adeemed and a trial would be futile.
The Delaware Supreme Court affirmed: it agreed the specific devise was adeemed by the predeath sale and that any recovery would flow to Mildred as residuary beneficiary, making trial relief futile.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the specific devise of the Property adeemed when Burke sold it before death	Kevin: Will contemplates sale proceeds to beneficiaries; proceeds should be treated as subject matter of the devise	Mildred: Sale prior to death ademes the specific devise; proceeds are not substituted for the real property	Held: Sale adeemed the specific devise; ademption applies and the devise fails
Whether Kevin has standing to challenge Mildred’s conduct with respect to the account holding sale proceeds	Kevin: He and siblings have an interest because the Will contemplates distribution of sale proceeds to them	Mildred: If devise adeemed, Kevin has no interest in those proceeds and thus lacks standing	Held: Court did not decide standing because ademption and futility made trial unnecessary; affirmed result without reaching Master’s standing conclusion
Whether equity can impose a constructive or resulting trust to benefit the children despite ademption and residuary beneficiary being Mildred	Kevin: A constructive trust or other equitable remedies could return funds to estate or children	Mildred: Imposing such a remedy would conflict with testamentary scheme and be improper where recovery would flow to residuary beneficiary (her)	Held: Trial would be futile—any recovery for the estate would flow to Mildred as residuary beneficiary; court declined to impose a trust in favor of the children

In re Hobson’s Estate, 456 A.2d 800 (Del. Ch. 1982) (defines and applies the rule of ademption when a testator disposes of specifically devised real estate before death)
Lingo v. Lingo, 3 A.3d 241 (Del. 2010) (refuses to reallocate inheritance to third parties despite fiduciary misconduct where doing so would conflict with the testator’s testamentary scheme)
Law v. Law, 753 A.2d 443 (Del. 2000) (states standard of review for grants of summary judgment)