Beneficiary Waits too Long to File Claim Against Estate

In re Estate of Tuzzolo, P-104-19, slip op. (N.J. Super. Ct. Ch. Div. June 5, 2019).

Plaintiff Susan Bechaw (“Bechaw”) and defendant Francine Cenicola (“Cenicola”) were daughters of the decedent, Philomena Tuzzolo.  When the decedent passed away in December 2008, Cenicola was appointed executrix of the decedent’s estate.

Two and a half years after the decedent’s death, after the administration of the estate was completed, an attorney for the executrix forwarded Bechaw a copy of an informal accounting and a refunding bond and release. Bechaw signed the release one day after receiving it.

In June 2011, Cenicola informed Bechaw that she planned to shred paperwork related to the estate since the matter had been settled. Around this time, Bechaw sought legal advice regarding the shredding of documents.  However, she chose not to retain an attorney at that point.

Later, in 2015, Bechaw retained an attorney. In February 2016, Bechaw’s attorney exchanged correspondence with Cenicola’s counsel and threatened to initiate litigation.  However, litigation never commenced at that point.

Bechaw finally commenced litigation in March 2019, which was 10 years after decedent’s death and eight years after the estate had been settled.

In her complaint, Bechaw requested that the court vacate the refunding bond and release and re-open the estate administration, and compel a formal accounting. She also sought injunctive relief regarding the destruction and preservation of any estate documents.  In lieu of an answer, Cenicola filed a motion to dismiss for failure to state a claim.  The court granted Cenicola’s motion to dismiss.

First, the court explained that the release signed by both parties barred the relief Bechaw was seeking in her complaint. When all interested parties agree to an informal accounting, none of them can later compel a formal accounting, absent a showing of show fraud, misrepresentation, mismanagement, undue influence or substantial misunderstanding by the beneficiary.  The court explained that the facts Bechaw alleged showed that the suspicions behind the current action were present eight years ago.  The timeline she alleged established that she had had the opportunity to ask for more information before signing the release.  Furthermore, Bechaw’s previous interactions with attorneys and her college education invalidated her assertion that she failed to appreciate the finality of signing the release.

Second, the court explained that the relief Bechaw sought was barred by the doctrine of laches. The court outlined the factors of the doctrine of laches, namely: “(1) the length of the delay; (2) the reasons for the delay; (3) how the circumstances of the parties have changed over the course of the delay.” Id. at *4.  Not only was the complaint filed eight years after the estate was settled, Bechaw had considered retaining or actually retained an attorney on two separate occasions.  Despite this, she voluntarily chose not to file an action both times.  The delay in filing the action would prejudice Cenicola since she had destroyed the estate documents under the impression that the estate had been settled.  Since Bechaw failed to assert a legitimate reason for her failure to file suit earlier, the court held that her complaint was precluded by the doctrine of laches.

Finally, the court held that Bechaw’s claims for fraud and conversion were barred by the statute of limitations. Bechaw alleged that the estate administration needed to be opened due to fraudulent activity that occurred during decedent’s lifetime.  The court explained that even if the claims were specifically asserted, they were time-barred.  Under New Jersey law, the statute of limitations for a fraud claim in connection with estate administration is two years.  The statute of limitations for conversion is six years.  By waiting eight years to file her suit, Bechaw’s claims were time-barred.  For those reasons, the court granted Cenicola’s motion to dismiss.