IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
JAMES ANDERSON, ) ) Plaintiff, ) ) v. ) C.A. No. 2023-0552-LM ) KENNETH ROBINSON, ) ) Defendant. )
MAGISTRATE’S POST-TRIAL FINAL REPORT
Final Report: August 15, 2024 Date Submitted: March 28, 2024
William B. Larson, Jr. and John J. Klusman, III, MANNING GROSS + MASSENBURG LLP, Wilmington DE; Counsel for Plaintiff.
Brian J. Ferry, FERRY JOSEPH, P.A., Wilmington, DE; Counsel for Defendant.
MITCHELL, M. I. INTRODUCTION
Although this case deals with a potential contract dispute, at its heart is a
family relationship that has deteriorated. The parties don’t have a traditional family
relationship in that they were born into the same family. Rather, at one point they
were a family because they chose to be a family and endeavored to create such a
relationship for themselves.
Kim Anderson, not a party to this case, is the link between the parties. Kim
Anderson met the Defendant, Kenneth Robinson, when she was a teenager and
friends with the Defendant’s daughter. Through the years the relationship between
Kim Anderson and the Defendant and his wife, Eileen Robinson, grew into a parent
and child relationship. She treated the Defendant and his wife as her parents and
referred to them as her mom and dad. For a time, the Robinsons treated Kim
Anderson similar to their biological children.
Currently, Kim Anderson lives with her partner, the Plaintiff James Anderson
and their two children. Plaintiff met the Defendant through Kim Anderson. Plaintiff
filed this lawsuit to enforce an alleged promise between the parties. Plaintiff’s
Complaint alleges that he and Defendant Kenneth Robinson, came to an agreement
that Defendant would move into the basement of his home. The basement required
remodeling due to Defendant’s wife’s medical needs and Plaintiff alleges that the
parties mutually agreed that Defendant would reimburse him for those expenses. 1 Defendant denies Plaintiff’s claim and asserts, arguendo, that Plaintiff could
not have reasonably relied on any alleged promise to repay for the renovations
because he was aware the Defendant was having financial trouble. Moreover,
Defendant asserts that Plaintiff has only benefited from these renovations. At the
heart of the issue is whether an actual agreement or promise occurred, and whether
Plaintiff reasonably relied on it. For the reasons explained below, I find that the
Plaintiff failed to prove that the parties entered into an enforceable agreement and
Defendant made any promise to repay him for the construction. Accordingly, I find
that the Plaintiff did not reasonably rely on a promise, and the enforcement of the
alleged promise is not necessary to avoid injustice.
II. BACKGROUND1
Plaintiff James Anderson (hereinafter, the “Plaintiff”) owns the property
located at 12 Barberry Lane, Wilmington, DE, 19807 (the “Property”). 2 Kim
Anderson alleges Kenneth Robinson (the “Defendant”) had a parent-like
relationship with her for twenty-five years before their relationship deteriorated in
the summer of 2022. 3 Although Ms. Anderson and the Robinsons live about 90
1 The facts in this report reflect my findings based on the record developed at trial on February 9, 2024. I grant the evidence the weight and credibility I find it deserves. Citations to the trial transcripts are in the form “Tr. __ ” and citations to the Docket in the form of “D. I.__” for the Docket Item number. 2 Pretrial Stip at 1. 3 D. I. 7 at ¶2. 2 minutes from one another, they spent time together once or twice a month, spent
holidays together, and spoke daily.4 Plaintiff and Defendant were friends for a five-
year period after initially meeting seven years ago.5 Neither Plaintiff nor Defendant
have ever loaned significant amounts of money to the other. 6
In March 2020, Defendant’s wife, Eileen Robinson (“Mrs. Robinson”) was
admitted to the hospital for a few days, so Mr. Robinson stayed with the Plaintiff
and Kim Anderson (together “the Andersons”).7 During this visit, Defendant
testified that Plaintiff brought him to the basement of the Property to “show [him]
what he was thinking.” 8 Defendant asserts that Plaintiff generally wanted to make a
wheelchair-accessible apartment in the basement for Defendant and Mrs. Robinson
(the “Robinsons”) to live in.9 Plaintiff contends that during this conversation, the
parties came to a “handshake agreement” that if Plaintiff remodeled the basement,
then Defendant would pay for the remodeling. 10 Defendant denies that he ever came
4 Tr. 13:14-24; 14:1-24. 5 Tr. 76:9-13; 127:5-8. 6 Tr. 127:10-13. 7 Tr. 15:1-2. Hospital visitation across the country was either prohibited or limited during this time because of COVID-19 restrictions. 8 Tr. 213:17-23. 9 Tr. 213:3-9. 10 Tr. 84:15-23. 3 to the home with the purpose of looking at the basement. 11 Defendant also denies
and Plaintiff agrees, that no conversation with the Andersons ever occurred
regarding specific payment for basement remodeling or promises related to the costs
of remodeling. 12 Further, Defendant testified that even if he had promised Plaintiff
that he would repay him for remodeling expenses, he would have been unable to pay
the renovation expenses. 13 Nonetheless, Defendant also testified that he recently sold
his home and received $158,000 in proceeds from the sale.14
A. Property Renovations
Two years after this purported agreement, Plaintiff entered into a contract (the
“Contract”) with Zane’s Custom Carpentry for $90,070.02 worth of renovations to
create the “in-law suite”. 15 Plaintiff attributes supply chain issues and COVID for
the two-year delay in starting the project. 16 Plaintiff claims that he relied on
Defendant’s promise and spent a considerable amount on renovations because of his
familial-like relationship with Defendant and because “a deal is a deal.”17 Plaintiff
further states that the “minutia of the details” related to the costs and construction
11 Tr. 211:23-24. 12 Tr. 214: 12-24; Tr. 215:1-7. 13 Tr. 215:8-22. 14 Tr. 245:1-6. 15 D. I. 2 (Exhibit A). 16 Tr. 7:14-22. 17 Tr. 124:8-24. 4 were never discussed between the parties because Defendant trusted him to get the
job done as they agreed. 18
Renovations officially began in May 2022. 19 $28,000 became due in May
2022 as an initial deposit with additional payments due upon the completion of
various tasks.20 At trial, Plaintiff admitted that fifteen of sixteen payments made for
the renovations were made regardless of the Robinsons’ plan to move into the
Property.21 Plaintiff even used money from his retirement savings to pay for the
renovations because he felt that he had a contractual obligation to pay the Contract
regardless of his dealings with the Defendant.22
Defendant testified that he was unaware of the Contract or any basement
renovation work being done at the Property until he was served with this lawsuit in
May 2023.23 When the Andersons decided to renovate the basement, one of their
stated goals was to make it compliant with the American Disability Act (“ADA”)
standards for accessibility to fit Mrs. Robinson’s needs. 24 However, Ms. Anderson
18 Tr. 125:1-13. 19 D. I. 7 at ¶10. 20 D. I. 2 (Exhibit A). 21 Tr. 173:7-11; D. I. 2 (Exhibit A). 22 Tr. 173:9-11. Tr. 213:12-14; D. I. 1; Plaintiff never spoke to Defendant again about renovations after 23
March of 2020. 24 Tr. 66:14-16. 5 admitted that the finished bathroom was not designed for Mrs. Robinson’s specific
needs because after the parties' fallout, “it was really clear that at that point my
parents [the Robinsons] weren’t moving in.” 25 Additionally, the placement of the
bed in the bedroom is not currently tailored to allow Mrs. Robinson to navigate the
room in her wheelchair. 26
Moreover, Plaintiff alleges that he has suffered roughly $90,000 in losses for
his liability under the Contract.27 Plaintiff stipulated that these renovations are not
an investment in the Property with a potential return because he personally does not
expect to receive proceeds from the sale of the home because he has no intention to
sell the home during his lifetime. 28 However, Plaintiff did testify that he trusted Mr.
Robinson at his word and that the risk of not collecting from him was not considered
when initially entering the Contract. 29 Plaintiff also stated that in the fall of 2022, it
25 Tr. 67:4-9. 26 Tr. 68:20-24. 27 D. I. 7 at ¶33; Tr. 177:12-15; In the complaint, Plaintiff states that Defendant should be liable for $90,000. At trial, Plaintiff stated that he lost $116,000. The variance between these two numbers is the unexpected costs related to a gas leak and negligent air duct and ceiling installations incurred during the renovations. Plaintiff is not seeking to hold Defendant liable for these costs. 28 Tr. 179:2-11. 29 Tr. 160:11-20. 6 became understood that the Robinsons would not be moving in or paying for the
renovations. 30
B. Fallout Between the Parties
Sometime in June 2022, the relationship between Ms. Anderson and the
Robinsons began to deteriorate.31 It began with the Robinsons uninviting the
Andersons to stay at their home in New Jersey at the request of their daughter Lori,
who planned to stay at their parents’ home that same weekend. 32 Sometime later, the
Andersons were also uninvited to attend the Defendant’s birthday party in
September of 2022. 33 Ms. Anderson was also removed from the Robinsons’ wills
and asked her to remove her name form their deed to their New Jersey home.34 An
attempt to reconcile, made in October of 2022, was unsuccessful. 35 Ms. Anderson
indicated she realized that the Robinsons were not going to move into the basement
after she received an email, later in 2022, from the Robinsons asking her to remove
her kids’ things out of their house. 36 Despite the change in their relationship, Ms.
30 Tr. 159:3-17. 31 Tr. 20:1-3. 32 Tr. 20:8-24 – 21:1-6. 33 Tr. 59:15-19. 34 Tr. 59:20-22; Tr. 60:12-24. 35 Tr. 60:20-24. 36 Tr. 62:7-13: 63:7-14. 7 Anderson testified that the renovations continued with the hope that they would
reconcile in the future. 37
C. Procedural Background
Plaintiff filed an initial complaint on May 22, 2023, claiming negligent
misrepresentation, promissory estoppel, and equitable fraud. 38 Defendant answered
on August 3, 2023, claiming that Plaintiff ordered these repairs on his own volition,
he did not promise to pay for renovations, and that no special relationship ever
existed between the parties.39 On August 30, 2023, Defendant moved for a protective
order alleging Plaintiff’s deposition request presented an undue burden.40
On September 5, 2023, I granted the Defendant’s Motion for Protective Order
and canceled the scheduled deposition. 41 I scheduled a pretrial conference for
February 2, 2024, and the trial for one week following that conference.42 At the
conclusion of a day-long hearing on the merits, I ordered the parties to submit post-
37 Tr. 61:1-8. 38 D. I. 1; D. I. 3; D. I. 7; Complaint was amended to correct the Defendant’s home address. The verified amended complaint was filed on May 25, 2023. 39 D. I. 9. 40 D. I. 12. 41 D. I. 15. 42 D. I. 29; D. I. 30. 8 trial summations three weeks from the date that the hearing transcript became
available.43 The parties submitted timely post-trial summations on March 28, 2024.44
III. ANALYSIS
A. Negligent Misrepresentation
To succeed on a claim for negligent misrepresentation, the Plaintiff must
plead that: “(1) the defendant had a pecuniary duty to provide accurate information,
(2) the defendant supplied false information, (3) the defendant failed to exercise
reasonable care in obtaining or communicating the information, and (4) the plaintiff
suffered a pecuniary loss caused by justifiable reliance upon the false information.”45
To satisfy these requirements, the “plaintiff need not demonstrate that the
misstatement or omission was made knowingly or recklessly.” 46
Further, under Delaware law, a negligent misrepresentation claim is
successful only “if there is either: (i) a special relationship between the parties over
which equity takes jurisdiction (like a fiduciary relationship) or (ii) justification for
43 D. I. 32. 44 D. I. 33; D. I. 34. 45 CFGI, LLC v. Common C Holding LP, 2024 WL 325567, at *11 (Del. Super. Ct. Jan. 29, 2024) (quoting Vichi v. Koninklijke Philips Elecs., N.V., 85 A.3d 725, 822 (Del. Ch. 2014). 46 PR Acquisitions, LLC v. Midland Funding LLC, 2018 WL 2041521, at *13 (Del. Ch. Apr. 30, 2018) (citations omitted). 9 a remedy that only equity can afford. The Court of Chancery has exclusive
jurisdiction over claims of negligent misrepresentation.”47
The particular relationships for negligent misrepresentation claims are
relationships more akin to fiduciary or trustee relationships.48 “Generally, [a]
fiduciary relationship is a situation where one person reposes special trust in another
or where a special duty exists on the part of one person to protect the interests of
another.”49 For example, executors and agents are fiduciaries. 50
However, there can be times where “a relationship predicated on particular
confidence or reliance may give rise to fiduciary obligations.”51 Courts will consider
“whether circumstances make it certain the parties do not deal on equal terms but on
one side there is an overmastering influence or on the other weakness, dependence
or trust, justifiably reposed” to determine whether such a relationship exists. 52 There
47 CFGI, LLC, 2024 WL 325567, at *11. See also, Biegler v. Underwriting Serv. Mgmt. Co., 2022 WL 17820533, at *3 (Del. Ch. Dec. 20, 2022) (citations omitted) (holding Negligent misrepresentation requires the existence of a special relationship “such as that between a director and stockholder or a trustee and cestui que trust… .) “cestui que trust” refers to the relationship between the beneficiary of a trust’s equitable interest and the Trustee’s legal title. 48 See id. 49 Ballantine v. Latham, 2022 WL 15627212, at *6 (Del. Ch. Oct. 28, 2022) (citing Mitchell v. Reynolds, 2009 WL 132881, at *9 (Del. Ch. Jan. 6, 2009) (internal quotation marks omitted)). 50 See Id. 51 Id. 52 Id. 10 needs to be special trust imposed or any special duty to protect the plaintiff's
interests.53 The plaintiff must demonstrate its dependence on the defendant.54
Here, I find that Plaintiff failed to make an adequate claim of negligent
misrepresentation because Plaintiff failed to show that he had a fiduciary or special
relationship with Defendant such that Defendant owed him any duty. Further, even
if Plaintiff believes a parent-like relationship would satisfy the requirement, Plaintiff
fails to establish that this parent-like relationship placed him in a position of
weakness against Defendant or that the Defendant owed him any duties. Evident
here, the parties were on equal terms.
B. Equitable Fraud
“A claim for negligent misrepresentation is often referred to interchangeably
as equitable fraud.”55 However, a claim of equitable fraud can only be adjudicated
in a court of equity.56 To state a claim for equitable fraud, the Plaintiff must prove
by a preponderance of the evidence: (1) the parties were in a fiduciary or confidential
relationship, (2) the defendant made a false representation, (3) the defendant
53 See Blueacorn PPP, LLC v. Pay Nerd LLC, 2024 WL 481053, at *2 (Del. Ch. Jan. 29, 2024). 54 See Id. at *3. 55 Fortis Advisors, LLC v. Dialog Semiconductor, 2015 WL 401371, at *9 (Del. Ch. Jan. 30, 2015). 56 See Zebroski v. Progressive Direct Ins. Co., 2014 WL 2156984, at *6 (Del. Ch. Apr. 30, 2014). 11 intended to induce action by that false representation, (4) there was reasonable
reliance on that false representation, and (5) the plaintiff suffered causally related
damages. 57
Like negligent misrepresentation, to satisfy the special relationship
requirement for equitable fraud, the relationship must be fiduciary or trustee-like.58
That duty cannot be substituted for the duty to cooperate in a contract as the Court
“does not apply fiduciary duty doctrine to ordinary commercial transactions” which
are normally regulated by normal market conditions as opposed to “concerns of
equity for persons in special relationships of trust and confidence.” 59
Plaintiff’s claim for equitable fraud also fails due to the lack of special
relationship between the parties. As stated above, regardless of whether there was a
parent-like relationship, it’s insufficient to satisfy the special relationship
requirement for equitable fraud. Moreover, Plaintiff’s assertion that the parties had
an oral contract and Defendant failed to pay for the basement renovations in
compliance with their alleged oral contract, is not an appropriate basis for relief
under equitable fraud because the duty to cooperate in a contract is merely a
57 Anderson v. Hill, 2024 WL 64774, at *6 (Del. Ch. Jan. 5, 2024). 58 Biegler, 2022 WL 17820533, at *3. 59 Blueacorn PPP, LLC, 310 A.3d at 594. 12 contractual duty rather than one that requires specialized trust akin to a fiduciary
duty.
Further, Plaintiff has also failed to show that Defendant made a false
representation or that he intended to induce Plaintiff to renovate the basement. I find
it credible that Defendant indicated some desire to move into Plaintiff’s basement.
However, Defendant was not involved in any of the contractor negotiations. When
Plaintiff executed the contract with the contractor and determined costs, Plaintiff
admits that he did not inform Defendant before he did so even though a two year
period passed since the initial discussion. Defendant’s role in the specifics of the
design of the renovations were also limited. Except for limited information
regarding the Robinson’s disability needs, Defendant was not in control of the design
of the renovations nor was he aware of the status of the basement project and its
progression like one would expect a financier to be aware of.
Plaintiff also failed to show reasonable reliance. Plaintiff produced no
evidence of any significant discussions with Defendant about the material facts of
the construction. Very little related to needs, timing, cost, or repayment. As such,
Plaintiff had no basis to believe that Defendant had the financial capability or
intention of paying over $90,000 for the basement project. Plaintiff was aware that
Defendant had to sell his house to cure medical costs. That fact alone was cause for
a formal agreement regarding repayment of nearly $100,000.
13 To the extent the July 2022 fall out between the parties evinces some intention
for Defendant to move into Plaintiff’s basement, following the fall out it became
unequivocally clear that Defendant was no longer going to do so while Plaintiff
continued to make modifications and progress on the project.
C. Promissory Estoppel
To state a claim for promissory estoppel, “a plaintiff must prove by clear and
convincing evidence that: ‘(i) a promise was made; (ii) it was the reasonable
expectation of the promisor to induce action or forbearance on the part of the
promisee; (iii) the promisee reasonably relied on the promise and took action to his
detriment; and (iv) such promise is binding because injustice can be avoided only by
enforcement of the promise.’”60
“Promissory estoppel is fundamentally a narrow doctrine, designed to protect
the legitimate expectations of parties rendered vulnerable by the very processing of
attempting to form commercial relationships.” 61 “Promissory estoppel requires a real
promise, not just mere expressions of expectation, opinion, or assumption. Such a
promise must be reasonably definite and certain.”62
Kokorich v. Momentus Inc., 2023 WL 3454190, at *11 (Del. Ch. May 15, 2023) (quoting 60
Windsor I, LLC v. CWCapital Asset Mgmt. LLC, 238 A.3d 863, 876 (Del. 2020). 61 Schaeffer v. Lockwood, 2021 WL 5579050, at *18 (Del. Ch. Nov. 30, 2021). 62 Id. 14 1. Defendant did not promise to pay for the basement renovations.
Plaintiff failed to establish a claim for promissory estoppel. It is unclear
whether Defendant promised to pay for the renovations. It is clear, however, that
Defendant did not promise to pay for a specified amount, a detail that I find material
for a residential renovation totaling almost $100,000. Plaintiff contends that
Defendant promised to pay for the basement renovations while Defendant denied
ever making such a promise. Plaintiff provided no proof to show that Defendant
made a promise other than his testimony. I don’t find Plaintiff’s testimony alone,
enough to show that Defendant made a real, reasonable, and definite promise. At
best, it was a mere “expression of expectation, opinion, or assumption.”63
2. Defendant did not reasonably expect to induce Plaintiff to renovate his basement based on an alleged promise.
Defendant did not have a reasonable expectation to induce Plaintiff to incur
the costs of the basement renovations. The parties were friends for five years through
their mutual relationship with Ms. Anderson. During that time they never loaned
money to each other or executed any form of transaction with one another
whatsoever. Plaintiff had no basis to have a reasonable belief that Defendant had
$100,000 at the time of the alleged oral agreement.
63 Id. 15 3. Plaintiff did not reasonably rely on Defendant’s alleged promise.
Even if Defendant did allegedly promise to pay for the basement renovations,
Plaintiff did not reasonably rely on such a promise. Defendant never saw the contract
from the contractor. He never saw the status of the project. Plaintiff never informed
Defendant about the contract and never sent him any updates on it, even after their
falling out. At most, Plaintiff alleged that the parties had an oral agreement that the
renovation costs would amount to around $100,000, but never settled on a specific
amount, even after Plaintiff signed the contract with the contractor and determined
the prices. Also, Plaintiff admitted that he assumed a risk of not getting reimbursed.
Furthermore, the basement renovations were not being constructed to meet
the Defendant’s needs. The bedroom would not fit Eileen Robinson’s wheelchair.
Plaintiff confirmed that, after the Defendant told him that he was not moving in, that
Plaintiff decided to make changes to the basement project. Plaintiff specifically
discussed how they modified their project to no longer meet the needs of
Defendant’s. Plaintiff issued sixteen checks to Zane to pay for the basement
renovations. Fifteen of them were issued after the falling out between the families,
where it became more clear that the Defendant no longer wished to move into the
Plaintiff’s basement. Plaintiff confirmed that only one of his sixteen payments was
made prior to Defendant informing him that he would not pay. Plaintiff never spoke
to Defendant again about the basement renovation after March 28, 2020. 16 Plaintiff admitted that he assumed the risk that the Defendant would not
reimburse him for the basement. Plaintiff also admitted that he was assuming a risk
by moving forward with the project after knowing the Defendant would not pay.
Plaintiff knew that Defendant was not going to move into the basement by the fall
of 2022 when Defendant told Plaintiff to remove all his property in the house. Yet,
Plaintiff continued to make payments for the renovations with this knowledge.
4. Enforcement of Defendant’s alleged promise is not necessary to avoid injustice.
Defendant’s alleged promise does not need to be enforced to avoid any
injustice to Plaintiff. Plaintiff admitted that when he goes to sell his house, that it
will sell for a higher dollar amount because of the basement renovation. Plaintiff
confirmed that many of the jobs completed by contractors on his house were not
related to Defendant and not requested by Defendant. Plaintiff claimed that the
contractors that he hired were negligent. There was a gas leak, air ducts were
installed incorrectly, a ceiling had to be installed, and more. Defendant should not
be responsible for the increased costs that resulted from the negligence of Plaintiff’s
contractors. Nor should Defendant be required to pay for basement renovation costs
when Plaintiff knew Defendant was not going to move into the basement.
17 IV. CONCLUSION
For reasons further explained above, I find Plaintiff has failed to establish
claims for negligent misrepresentation, equitable fraud, and promissory estoppel.
The parties’ parent-like relationship, to the extent it fully existed, does not arise to
any form of fiduciary relationship. Plaintiff blatantly continued to make payments
on the basement project after he knew Defendant was not going to move into the
basement. Defendant will not be liable for costs on such grounds.
This is my Final Report, and exceptions may be filed under Court of Chancery
Rule 144.