## Facts

- In 1964, Karl Franz executed a will that left his residuary estate to his parents, and if they predeceased him, to Michael A. Prade.
- In 1985, Franz completed beneficiary designation forms for two non-probate assets connected to his employment at E.I. du Pont de Nemours and Company (DuPont): (1) a DuPont pension/savings plan and (2) a DuPont group life-insurance policy.
- The 1985 designation forms expressly named Prade as the sole beneficiary of both the pension plan benefits and the life-insurance proceeds.
- No allegation was made that Franz lacked capacity, was pressured, or was deceived when he executed the 1985 beneficiary designations, and no claim was made that the forms were ambiguous or improperly executed.
- In 1993, Franz decided he wanted to remove Prade from his estate plan. He consulted an estate-planning attorney and executed a new will that disinherited Prade and left the estate to other relatives.
- Franz did not execute new beneficiary designation forms for the pension plan or life-insurance policy before his death.
- After Franz died, the plan and policy documents directed payment to the beneficiary shown on the last executed designation forms—Prade.
- Mack Emmert, the executor of Franz’s estate and a residuary beneficiary under the 1993 will, filed a verified petition in the Delaware Court of Chancery seeking equitable reformation of the beneficiary designations so that the estate, rather than Prade, would receive the pension and life-insurance benefits.
- Emmert’s theory was that Franz’s failure to change the beneficiary forms after executing the 1993 will was a “mistake,” and equity should correct it.
- Prade moved for summary judgment. DuPont was named as a defendant largely as a stakeholder/administrator required to pay benefits according to the governing documents.

## Issues

1. Whether the Court of Chancery may reform clear, unambiguous pension and life-insurance beneficiary designation forms based only on allegations that the decedent later intended to disinherit the named beneficiary and mistakenly failed to change the forms, absent ambiguity, mutual mistake, fraud, or other inequitable conduct.
2. Whether a later will that removes a person as a beneficiary can change, or justify rewriting, non-probate beneficiary designations that remain in force under separate plan and insurance contracts.

## Decision

- The Court of Chancery granted Prade’s motion for summary judgment.
- The court denied Emmert’s request to reform the pension and life-insurance beneficiary designations.
- Even assuming the petition’s factual allegations were true, the court held Emmert had not stated a legally sufficient ground for reformation, and the unambiguous designation forms controlled payment of the benefits.

## Legal Principles

- Reformation is an equitable remedy used to correct a written instrument when it fails to reflect the parties’ actual agreement because of mutual mistake, or unilateral mistake combined with fraud or comparable inequitable conduct by the other party.
- A later change in the decedent’s wishes, coupled with a failure to complete the required beneficiary-change paperwork, is not the type of mistake that supports reformation of an otherwise valid, clear beneficiary designation.
- Pension plan and life-insurance beneficiary designations operate as contractual, non-probate directions for payment and are generally independent of the testator’s will.
- A will governs probate property, but it does not revoke or revise non-probate beneficiary designations unless the governing contract or applicable law provides a mechanism for doing so.
- Courts give effect to unambiguous beneficiary designation forms to preserve certainty in administration and to protect the rights created by the contract in favor of the named beneficiary.

## Conclusion

Because Franz’s 1985 beneficiary designation forms plainly named Prade as sole beneficiary and the petition alleged no ambiguity, defective execution, mutual mistake, fraud, or inequitable conduct, the Court of Chancery refused to rewrite the pension and life-insurance designations to match Franz’s later 1993 will; Prade remained entitled to the non-probate benefits, and summary judgment was entered in his favor.


Emmert v. Prade, 711 A.2d 1217 (1997)