Court Opinion

ID: 8210344
Source: CourtListenerOpinion
Date Created: 2022-09-29 17:03:07.71379+00
Date Added: 2024-06-11T16:41:49.668700
License: Public Domain

SUPERIOR COURT
                                 of the
                          STATE OF DELAWARE

Jeffrey J Clark                                               Kent County Courthouse
Resident Judge                                                          38 The Green
                                                                      Dover, DE 19901
                                                               Telephone (302)735-2111

Mr. Aaron Brown                                Mr. Michael K. DeSantis, Esquire
Ms. Nicole Miles-Berry                         Law Office of Dawn L. Becker
119 Davis Circle                               Citizens Bank Center
Dover, DE 19904                                919 Market Street, Suite 550
                                               Wilmington, DE 19801

                            Submitted: August 30, 2022
                       Decision Deferred: September 28, 2022

       RE: Aaron Brown, Nicole Miles-Berry, Z.B., a minor, Z.B., a minor and
           Z.B., a minor v. Geico Choice Insurance Company
           K20C-03-038 JJC

Dear Mr. Brown, Ms. Miles-Berry and Mr. DeSantis:
       This letter explains the Court’s request for additional briefing before it decides
GEICO’s motion for partial summary judgment. At this point in the proceedings,
GEICO’s interpleader claim is reduced to the question of how much uninsured
motorist coverage is available to the Plaintiffs. Supplemental argument from the
parties addressing two issues would be helpful: (1) whether the General Assembly’s
2017 statutory amendment that increased the minimum uninsured/underinsured
limits to $25,000/$50,000 applies to the policy and accident at issue; and if those
higher limits apply, (2) whether the Plaintiffs, who were insureds (but not policy-
holders), have standing to demand such coverage.
       Regarding the first issue, the Delaware Supreme Court has defined what
changes to an insurance policy create a new policy.              In State Farm Mutual Auto
Insurance Company v. Arms1 and Mason v. United Services Automobile
Association,2 the Court explained that the inquiry rests upon whether an
endorsement, amendment, or change to the policy materially changed the policy.3
If the changes were material, then there is a newly issued policy.4 In this case, if
GEICO materially changed the policy before the April 2018 accident, it issued a new
policy before the accident. If a new policy came into being before the accident, then
the 2017 statutory amendment’s higher limits may apply to the Plaintiffs’ claims
because the higher limits are mandatory for all newly issued or renewed policies
“that occur[ed] after [December 13, 2017].5
       Here, Plaintiffs contend that when GEICO issued a new endorsement, before
the accident, it created a new policy of insurance. Accordingly, Plaintiffs believe
the higher minimum limits apply.               In contrast, GEICO did not address this
endorsement in its briefing. As a result, the Court requests supplemental argument
to address what effect, if any, the February 2018 policy change has on this claim.6
       The second issue involves GEICO’s challenge to Plaintiffs’ standing. GEICO
argues that the Plaintiffs, as permissive users and occupants of the GEICO insured
vehicle, are not entitled to the higher limits because they do not have standing to
seek to reform the policy. In support, GEICO cites the Superior Court’s decision in

1
  477 A.2d 1060 (Del. 1984).
2
  697 A.2d 388 (Del. 1997).
3
  Arms, 477 A.2d at 1064-65.
4
  Id.
5
  81 Del. Laws ch. 39 § 2 (2017).
6
  See Pl. Supp. Filing, D.I. 50, Ex. B (attaching what appears to be an endorsement to the policy
and a new declaration page issued prior to the accident).
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Menefee v. State Farm.7 That decision, however, addressed a plaintiff’s standing to
challenge the sufficiency and timing of a meaningful offer to increase UM coverage
under 18 Del. C. § 3902(b). Additional non-mandatory Delaware State and federal
case decisions have also applied that approach.8               This case, however, does not
implicate Section 3902(b).         Rather, it involves the statutory minimum coverage
guaranteed by 18 Del. C. § 3902(a)(2) and 21 Del. C. § 2902(b).
        Accordingly, the Court invites both parties to address Plaintiffs’ standing
more fully. The submissions should address at least two matters. At the outset,
they should address, in a general sense, whether an insured, who is not a policy-
holder, is foreclosed from reforming any portion of an insurance policy based upon
the Section 3902(b) related case law. Apart from that, the parties should also focus
on whether a claim for statutory minimum benefits under Section 3902(a)(2) must
be evaluated differently than the offer-acceptance mechanism examined in the cases
where a plaintiff sought reformation.          In other words, should Section 3902(b) be
treated differently than Section 3902(a)(2) for purposes of determining an insured’s
standing to demand statutorily required minimum coverage?
        Third, and finally, the parties included portions of the relevant policy in the
summary judgment record.           In the absence of a complete policy for the Court to
review, the record is incomplete. To provide additional context for the Court’s
decision, GEICO must provide the Court (1) a certified complete copy of the policy
as it existed prior to February 4, 2018, and (2) a certified declaration page and a
complete copy of any endorsements to the policy that GEICO issued on February 6,
2018.

7
  1986 WL 6590 (Del. Super. May 28, 1996).
8
   See e.g., Starr v. Nationwide Mutual Ins. Co., 548 A.2d 22, 28 (Del. Ch. 1988), aff’d 575 A.2d
1083 (Del. 1990). On appeal, the Delaware Supreme Court affirmed the Court of Chancery’s
decision but did so without addressing the issue of standing of a plaintiff that did not appeal the
issue.
                                                 3
      The parties should provide their supplemental argument and information on
or before November 1, 2022.     They may submit their arguments in letter form in
the length they believe appropriate to address these issues.

      IT IS SO ORDERED.
                                              Very truly yours,

                                              /s/ Jeffrey J Clark
                                                Resident Judge
JJC:klc
Via File & ServeXpress

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