MISSOURI COURT OF APPEALS WESTERN DISTRICT FINANCIAL CREDIT ) INVESTMENTS II, TRUST E, ) ) Appellant, ) ) v. ) WD87569 ) ESTATE OF GEORGIA TOWERS, ) Filed: June 17, 2025 et al., ) ) Respondents. )
Appeal from the Circuit Court of Jackson County The Honorable James F. Kanatzar, Judge
Before Division Three: Edward R. Ardini, P.J., and Alok Ahuja and Thomas N. Chapman, JJ. Financial Credit Investments II, Trust E, filed this action in the Circuit
Court of Jackson County against the Estate of Georgia Towers, and against Edwin Towers, Georgia Towers’ husband. (Georgia Towers died in 2021.) The lawsuit
concerns the parties’ respective rights to a policy insuring Georgia Towers’ life.
Financial Credit contends that it is entitled to the $5 million death benefit on the
life insurance policy, because the Towerses lawfully sold their rights in the policy
in the secondary market, and Financial Credit purchased the policy rights before
Georgia Towers’ death. The Estate and Edwin Towers contend that the policy was an unlawful “stranger originated life insurance” (or “STOLI”) policy, and that the proceeds of the policy rightfully belong to the Estate.
The circuit court dismissed Financial Credit’s action, due to the pendency
of other litigation initiated by the Estate in Minnesota and Delaware, which raises the same issues. Financial Credit appeals. We affirm.
Factual Background We refer to the Estate and Edwin Towers collectively as “the Estate,” except
where the context requires otherwise. As explained in the “Standard of Review”
section which follows, we recite the facts in the light most favorable to the circuit
court’s judgment, considering not only the allegations of Financial Credit’s amended petition, but also the exhibits which both parties submitted to the
circuit court in connection with the Estate’s motion to dismiss.
The Estate alleges that, beginning in 2001, Coventry, U.S. Bank, Wells
Fargo, Financial Credit, and others entered into a series of contracts through
which Coventry and others agreed to originate life insurance policies that would
then be sold to investors after the policies’ contestability periods expired. (The
“contestability period” is the time during which an insurance company can
challenge the validity of a newly issued policy. See PHL Variable Ins. Co. v. Price
Dawe 2006 Ins. Tr., 28 A.3d 1059, 1065 (Del. 2011)). U.S. Bank and Wells Fargo served as “securities intermediaries” for the bulk of the policies, meaning that
they were named as the record owners of the insurance policies, and acted as
agents for the policies’ beneficial owner-investors. Ultimately, when the insured died, the securities intermediary would obtain a death certificate and claim the
2 benefits under the policy. The securities intermediary would then transfer the policy proceeds to the policy’s beneficial owner(s).
In 2006, while residing in California, Georgia and Edwin Towers obtained
a policy on Georgia’s life, with a death benefit of $5 million. The Policy was issued to the Georgia R. Towers Family Trust 2006, which was created as a
Delaware inter vivos trust, administered by a Delaware trustee (Wilmington
Trust Company). The Estate alleges that Coventry created the Trust, and
orchestrated the entire transaction whereby the Policy was originated. Sometime
in 2008, after the contestability period for the Policy expired, the Towerses sold
their individual and collective rights to the Policy to a third party who used Wells Fargo as securities intermediary. Financial Credit alleges that Georgia and Edwin
Towers “collected a substantial payout through the sale of the Policy, and did not
pay any premiums on the Policy after its sale.”
The Estate alleges that, prior to the sale of the Policy to the third-party
investor, premiums for the Policy were paid using the proceeds of a non-recourse
loan issued by Coventry to the Trust; the loan was secured solely by the Policy
and the Trust. The Estate alleges that the loan was a sham, and was designed so
that, at the end of the Policy’s contestability period, all rights to the Policy and the
Trust would be relinquished to Coventry in satisfaction of the loan. Once the Policy was sold to a third-party investor, that investor (acting through Coventry
and Wells Fargo), paid the premiums on the Policy until Georgia Towers’ death.
Georgia and Edwin Towers moved to Missouri sometime in 2008.
3 In 2015, the Policy was sold to Financial Credit, although Wells Fargo continued as the Policy’s ostensible owner and beneficiary in its role as securities
intermediary.
After Georgia Towers’ death in 2021, the $5 million death benefit under the policy was paid to Wells Fargo. Wells Fargo then transferred the death benefit to
Financial Credit.
The Estate alleges that the Policy was an illegal “stranger-originated life
insurance” (or “STOLI”) policy. In Warnock v. Davis, 104 U.S. 775 (1881), the
Supreme Court of the United States gave an early explanation why most
jurisdictions prohibit such STOLI policies. The Court explained that, for a life insurance policy to be valid,
there must be a reasonable ground, founded upon the relations of the parties to each other, either pecuniary or of blood or affinity, to expect some benefit or advantage from the continuance of the life of the assured. Otherwise the contract is a mere wager, by which the party taking the policy is directly interested in the early death of the assured. Id. at 779.1
In January 2023, the Towers Estate and eight other estates filed suit
against U.S. Bank and Wells Fargo in the United States District Court for the District of Minnesota. Estate of Ann Boggess, et al. v. U.S. Bank, N.A. and Wells
1 See also, e.g., Geronta Funding v. Brighthouse Life Ins. Co., 284 A.3d 47, 60 (Del. 2022) (“[f]or hundreds of years, the law has prohibited wagering on human life through the use of life insurance that was not linked to a demonstrated economic risk”); Estate of Bean v. Hazel, 972 S.W.2d 290, 291 (Mo. 1998) (“The longstanding rule in Missouri is that one must have an insurable interest in a person's life in order to take out a valid policy of insurance on that person's life. . . . If a beneficiary insures the life of a person when the beneficiary has no insurable interest, the policy is referred to as a wager life insurance policy.” (citations omitted)); Jimenez v. Protective Life Ins. Co., 10 Cal. Rptr.2d 326, 330 (App. 1992) (same); Cal. Ins. Code § 10110.1(a).
4 Fargo Bank, N.A., Case No. 0:23-cv-00045 (D. Minn.). The estates alleged that the policies insuring the lives of each of their decedents were STOLI policies
which were void ab initio under Delaware law. See, e.g., Wells Fargo Bank, N.A.
v. Estate of Malkin, 278 A.3d 53, 56 (Del. 2022) (“STOLI policies are void ab initio, never come into legal existence, represent a ‘fraud on the court,’ and can
never be enforced”). The Minnesota Action named Wells Fargo and U.S. Bank as
defendants in their capacities as securities intermediaries, and based on their
status as record owners of the challenged policies, and the immediate recipients
of the death benefits paid under the policies. The estates claimed that, under 18
Del. C. § 2704(b), the estates were entitled to recover from Wells Fargo and U.S. Bank the life insurance benefits which had been paid to them.
The deadline to amend the complaint in the Minnesota Action to add
additional defendants was April 12, 2023; that deadline passed without the
estates amending their complaint to name any of the policies’ beneficial owners.
In early May 2023, the previously unknown beneficial owners of two of the
policies at issue in the Minnesota Action filed suit in Pennsylvania against the
estates of the decedents named in those two policies. Viva Capital 3 LP v. Bolle,
Civ. No. 2023-09333 (Court of Common Pleas, Montgomery County, Pa.); VC 3
LS 2021 LP v. Howey, Civ. No. 2023-09337 (Court of Common Pleas, Montgomery County, Pa.). Neither of the Pennsylvania lawsuits involved the
Policy insuring Georgia Towers’ life.
In response to the Pennsylvania actions, on May 12, 2023, all of the original plaintiffs in the Minnesota Action, including the Towers Estate, filed suit
in Delaware. Estate of Ann Boggess, et al. v. Viva Capital 3 L.P., et al., No.
5 N23C-05-130 EMD CCLD (Del. Super. Ct.). The Delaware complaint named the newly discovered beneficial owners as defendants.
Like the Minnesota Action, the Delaware Action sought to recover the life
insurance benefits paid out to the securities intermediaries, and ultimately paid to the beneficial owners. The original complaint in the Delaware Action alleged
that, “[w]hen they brought the Minnesota action, Plaintiffs did not know the
identity of the Policies’ beneficial owners.” The Delaware complaint alleged that,
in the Minnesota Action, Wells Fargo and U.S. Bank had “conceal[ed] the
identities of the Policies’ beneficial owners,” and that the estates had only learned
the names of certain of the beneficial owners when the investor-owners filed “two surprise lawsuits” in Pennsylvania. Besides naming the beneficial owners whose
identities had been revealed in the Pennsylvania litigation, the Delaware
complaint stated that “Plaintiffs reserve their right to amend this Complaint to
add any other beneficial owners that come to light.”
Ten days after the filing of the Delaware Action, Financial Credit filed the
present lawsuit in the Circuit Court of Jackson County on May 22, 2023.
Financial Credit named as defendants the Estate and Edwin Towers (in his
personal capacity, and in his capacities as executor of the Estate, and co-trustee
of the Trust). Financial Credit claimed that it was rightfully entitled to the benefits payable under the Policy because it had lawfully purchased the Policy,
and had paid the premiums on the Policy for several years before Georgia Towers’
death. Financial Credit’s original petition sought a declaratory judgment establishing its right to the Policy’s proceeds. Financial Credit’s original petition
also sought contractual and common-law indemnification from the Estate and
6 from Edwin Towers for the costs and attorneys’ fees which Wells Fargo had incurred defending the “baseless lawsuit” filed by the Estate in Minnesota.
Financial Credit alleged that it was entitled to indemnity for defense costs
incurred by Wells Fargo, because Financial Credit “likely will be responsible for such attorneys’ fees and costs per its securities account agreement with Wells
Fargo.” Financial Credit also sought indemnification for the costs and attorney’s
fees it incurred in the Jackson County case itself.
On May 24, 2023, the Towers Estate removed the case to the United States
District Court for the Western District of Missouri. The federal court remanded
the case to the circuit court on October 16, 2023, based on the fact that both the Estate and Edwin Towers were residents of the forum state in which the suit had
been filed.
Once Financial Credit revealed its identity by filing suit in Jackson County,
the estates amended their complaint in the Delaware Action on June 1, 2023, to
add Financial Credit as a defendant. Not to be outdone, on December 18, 2023,
Financial Credit amended its Jackson County petition to assert claims for fraud
and unjust enrichment against Edwin Towers personally, and in his capacity as
the Estate’s executor.
The Estate moved to dismiss or stay Financial Credit’s Missouri lawsuit on the basis of comity, forum non conveniens, the compulsory counterclaim rule,
and for failure to adequately plead the elements of fraud and unjust enrichment.
The circuit court granted the Estate’s motion to dismiss “for the reasons set forth in Defendant[s’] pleadings.”
Financial Credit appeals.
7 Jurisdiction The circuit court’s judgment did not specify whether the court dismissed
Financial Credit’s petition with or without prejudice. Because the judgment does not otherwise specify, the dismissal is deemed to be without prejudice. Supreme
Court Rule 67.03.
Before addressing the merits of Financial Credit’s appeal, we must decide whether we have appellate jurisdiction. See, e.g., Matthews v. Harley-Davidson,
685 S.W.3d 360, 365 (Mo. 2024) (citing Wilson v. City of St. Louis, 600 S.W.3d
763, 765 (Mo. 2020)). The fact that the judgment dismissed Financial Credit’s petition without prejudice “raises a question of whether the judgment is final and
appealable,” because the Missouri Supreme Court “occasionally has referred to a
‘general rule that a dismissal without prejudice is not a final judgment and, therefore, is not appealable.’” Naylor Senior Citizens Hous., LP v. Sides Constr.
Co., 423 S.W.3d 238, 242 (Mo. 2014) (citation omitted). The Court also
observed, however, that “[i]t is unclear to what extent, if any, this ‘general rule’
ever was followed,” and that, “[o]ver time, . . . exceptions seemed to have
swallowed all or nearly all of whatever rule once might have existed.” Id. at 243;
see also State ex rel. Henderson v. Asel, 566 S.W.3d 596, 599 n.6 (Mo. 2019) (quoting Naylor).
Although the circuit court’s judgment may permit Financial Credit to
reassert its claims in another lawsuit, the judgment prevents Financial Credit from litigating its claims in Jackson County, where it chose to file suit. “‘[A]n
appeal from a dismissal without prejudice can be taken where the dismissal has
the practical effect of terminating the litigation in the form cast or in the plaintiff's chosen forum.’” Konopasek v. Konopasek, 683 S.W.3d 250, 254 (Mo.
8 2023) (emphasis added; quoting Avery Contracting, LLC v. Niehaus, 492 S.W.3d 159, 162 (Mo. 2016)). The circuit court’s dismissal, albeit without prejudice,
prevents Financial Credit from litigating in its forum of choice; the judgment is
accordingly final and appealable.
Standard of Review As described above, the Estate moved to dismiss Financial Credit’s petition
on multiple grounds, and the circuit court’s judgment does not specify the basis
for dismissal on which it relied. Where, as here, a circuit court “did not specify
the basis for its decision to grant the Motion to Dismiss, we presume the
dismissal was on a basis set forth in the motion to dismiss, and we will affirm the dismissal if it can be supported on any basis set forth in the motion to dismiss.”
Hartman v. Logan, 602 S.W.3d 827, 835 (Mo. App. W.D. 2020). “Only if the
motion to dismiss cannot be sustained on any ground alleged in the motion will
the trial court’s ruling be reversed.” Rene v. Royal City Bell, LLC, 686 S.W.3d
262, 264-65 (Mo. App. W.D. 2024) (cleaned up; quoting Estate of Barros, 659
S.W.3d 624, 628 (Mo. App. W.D. 2022)).
As explained in the Discussion which follows, the circuit court’s judgment
can be sustained on the basis of the comity doctrine, due to the pendency of
litigation in other States raising the same issues which Financial Credit sought to raise here. In Estate of Barros, 659 S.W.3d 624 (Mo. App. W.D. 2022), we
summarily held that a similar dismissal based on the comity doctrine would be
reviewed under the general principle that “[w]e review the trial court’s decision to grant a motion to dismiss de novo.” Id. at 627.
9 Unlike in Estate of Barros (where the standard of review was not seriously contested or addressed by the parties), Financial Credit and the Estate argue at
length in their briefing over the standard of review properly applicable to a circuit
court ruling based on the comity doctrine. Based on the parties’ briefing, and our own research, we conclude that circuit court decisions invoking the comity
doctrine should be reviewed for an abuse of discretion.
In a number of cases, this Court has held that circuit courts have discretion
whether or not to rely on the comity doctrine to suspend litigation in Missouri
due to the pendency of similar litigation in another State, and that such rulings
are reviewed solely for abuse of that discretion. Most notably, in State ex rel. Miller v. Jones, 349 S.W.2d 534 (Mo. App. 1961), this Court held that a circuit
court’s refusal to stay a Missouri divorce proceeding, in deference to an earlier-
filed Colorado divorce case, was not subject to a writ of prohibition, because the
decision whether to invoke comity principles was discretionary. Miller explicitly
distinguished the comity doctrine, which involves suits pending in different
states, from the abatement doctrine applicable to parallel Missouri cases:
Abatement is a matter of right and the general rule is that, the pendency of a prior suit in one state cannot be pleaded in abatement or in bar to a subsequent suit in another state, even though both suits are between the same parties and upon the same cause of action. However, the court in which the second action is brought may in its discretion stay or suspend that suit, awaiting decision in the first one, or, influenced by a spirit of comity, may refuse to entertain it, if the same relief may be awarded in the prior suit. . . . [I]t is clear from the authorities quoted above that the question of granting a stay in the proceedings is a matter for the respondent's discretion, and of course, the manner in which the respondent should exercise his discretion is not a proper subject for prohibition.
10 Id. at 538-39 (cleaned up); see also Brooks Erection & Constr. Co. v. William R. Montgomery & Assocs., Inc., 613 S.W.2d 859, 863 (Mo. App. E.D. 1981) (finding
“no abuse of discretion” where trial court dissolved orders and stayed further
proceedings pending conclusion of out-of-state litigation); Jewell v. Jewell, 484 S.W.2d 668, 674 (Mo. App. 1972) (“The trial judge is vested with a broad
discretion in the matter under consideration and there being no manifest abuse,
that discretion as exercised should not be disturbed.”).
The factors guiding a comity decision support the conclusion that this is a
discretionary determination. The Missouri Supreme Court has explained that the
comity rule is not a “matter . . . of right” or “a rule of law,” but is instead based on considerations of “courtesy,” “respect,” “convenience and expediency”; the
doctrine “does not of its own force compel a particular course of action,” but is
instead “an expression of one State's entirely voluntary decision to defer to the
policy of another.” Ramsden v. State of Illinois, 695 S.W.2d 457, 459-60 (Mo.
1985) (cleaned up).
Notably, the considerations governing the application of the comity
doctrine are similar to those considered in the application of forum non
conveniens. Compare Loew v. Heartland Trophy Props., Inc., 665 S.W.3d 339,
346 (Mo. App. W.D. 2023) (describing factors to be considered in determining whether to apply forum non conveniens doctrine) with Brooks Erection, 613
S.W.2d at 863 & n.4 (discussing factors relevant to comity determination).
“Because the application of the doctrine of forum non conveniens is fact intensive and the weight to be accorded any factor is dependent on the circumstances,”
dismissals based on forum non conveniens are reviewed for an abuse of
11 discretion. Anglim v. Mo. Pac. R.R. Co., 832 S.W.2d 298, 303 (Mo. 1992); accord Chandler v. Multidata Sys. Int’l Corp., 163 S.W.3d 537, 546 (Mo. App.
E.D. 2005). Similar considerations apply to a circuit court’s application of the
comity doctrine. We will accordingly review the circuit court’s judgment under the abuse of discretion standard.2
In connection with the Estate’s motion to dismiss or stay the case, both
parties submitted materials for the court’s consideration beyond Financial
Credit’s amended petition. Neither party objected to the consideration of those
additional materials. A circuit court may be limited to the allegations of the
petition when deciding a motion to dismiss for failure to state a claim under Rule 55.27(a)(6). The court is not similarly constrained, however, when a motion to
dismiss is based on issues which are independent of the merits of the plaintiff’s
claims. Thus, in Andra v. Left Gate Property Holding, Inc., 453 S.W.3d 216 (Mo.
2015), the Missouri Supreme Court held that a circuit court may consider matters
beyond the petition, and may resolve factual disputes, when deciding a motion to
dismiss for lack of personal jurisdiction. The Court explained:
When the motion to dismiss for lack of personal jurisdiction is based on facts not appearing in the record, a court may also consider affidavits and depositions properly filed in support of the motion to dismiss. Such consideration does not serve to convert the motion to dismiss into a motion for summary judgment as the trial court's inquiry is limited to an examination of the petition on its face and the supporting affidavits to determine the limited question of personal jurisdiction. The merits of the underlying case are not considered. The circuit court can believe or disbelieve any statement
2 Because this opinion does not follow Estate of Barros’ statement concerning the applicable standard of review, the opinion has been reviewed and approved by order of the Court en banc. See S. Ct. Operating Rule 22.01; W.D. Special Rule 31.
12 in such affidavits, and factual determinations are within the sole discretion of the circuit court. Id. at 224 (cleaned up; citing and quoting Chromalloy Am. Corp. v. Elyria
Foundry Co., 955 S.W.2d 1, 3 n.3 (Mo. 1997)); see also Smith v. City of St. Louis,
573 S.W.3d 705, 712 (Mo. App. E.D. 2019). Similarly, the Supreme Court has recognized that, “[i]n deciding whether to dismiss [on the basis of forum non
conveniens], a trial court necessarily must determine facts and, in doing so,
weighs evidence and assesses the credibility of witnesses as to the reasons given
for selecting or opposing a particular forum.” Anglim, 832 S.W.2d at 303.
Accordingly, in reviewing the circuit court’s judgment, we will consider all
of the materials which the parties put before the circuit court, and “the evidence will be viewed in a light favorable to the result of the trial court.” Id.
Discussion In Estate of Barros, 659 S.W.3d 624 (Mo. App. W.D. 2022), this Court
recently summarized Missouri’s comity doctrine as it applies to the situation
where similar litigation is pending in Missouri and in another State:
Comity is a voluntary decision of one state to defer to the policy of another in an effort to promote uniformity of laws, harmony in their application, and other related principles. Comity and the duty to recognize the validity and effect of court proceedings in a foreign jurisdiction are not regarded as absolute rights, but are rather self-imposed restraints. The rule of comity is a matter of courtesy, complaisance, respect – not of right but of deference and good will. The doctrine of comity is not a rule of law, but one of practice, convenience and expediency. ....
Under the principle of comity, when two state courts have jurisdiction to determine an issue between the same parties, the court whose jurisdiction attached first should proceed to render a
13 final judgment. There are numerous Missouri cases which indicate a strong policy bent against duplicative actions and forum-shifting. When duplicative actions have been filed in separate states, the decision on whether to defer to one action is not intransigently governed by the “first to file” rule. Rather, the decision ultimately reflects considerations of comity and the orderly administration of justice. Id. at 628-29 (cleaned up); see also Brooks Erection, 613 S.W.2d at 863 & n.4 (in
affirming circuit court’s application of comity doctrine, referencing convenience
of the parties; location of witnesses; the litigation’s connection to the competing
states; the progress of the litigation in different forums; and the parties’ attempt
to evade important forum-state policies). The circuit court did not abuse its discretion in dismissing Financial
Credit’s petition in the circumstances existing here. The Minnesota, Delaware
and Missouri actions all involved the same fundamental, underlying issue: whether the policy insuring Georgia Towers’ life was an unlawful STOLI policy.
That fundamental question merits a single, uniform answer.
In addition, Delaware has an equal, if not greater, interest in the litigation
than Missouri. Although the Towerses lived in Missouri when Georgia Towers
died, they lived in California – not Missouri – when the Trust was established
and the Policy first purchased. Moreover, the Policy was actually purchased by a Delaware trust, which had a Delaware Trustee. The parties chose to arrange the
procurement of the Policy by a Delaware trust, with a Delaware trustee, at a time
when 18 Del. C. § 2704(g) provided that Delaware’s insurable interest statute would apply to any “trust-owned life insurance policy . . . without regard to an
insured's state of residency or location.” The statute also provided that “a trust-
owned life insurance policy, if delivered to the place of business in Delaware of
14 the trustee of said trust[,] . . . shall be deemed to have been delivered in this State.” Id. Thus, the choice to structure the purchase of the Policy through a
Delaware trust, with a Delaware trustee, had potential legal significance of which
the parties were, or should have been, aware.3 The application of comity principles is also justified by the fact that the
Delaware action was filed prior to Financial Credit’s initiation of this lawsuit.
The original Delaware complaint alleged that the securities intermediaries had
concealed the identity of the policies’ beneficial owners in the Minnesota
litigation, and that the plaintiff-estates did not know the identity of any of the
beneficial owners until two of them filed “surprise lawsuits” in Pennsylvania. The Delaware complaint also alleged that the securities intermediaries had concealed
the beneficial owners’ identities to permit the beneficial owners to gain a tactical
advantage by filing preemptive lawsuits in jurisdictions of their choosing. The
original Delaware complaint also advised that “Plaintiffs reserve their right to
amend this Complaint to add any other beneficial owners that come to light.”
Thus, Financial Credit should have anticipated that the Estate intended to name
it as a defendant in the Delaware Action, as soon as the Estate could learn
Financial Credit’s identity. The fact that Financial Credit filed its Missouri
lawsuit in the face of threatened litigation by the Estate favors deference to the Delaware action. See Anheuser-Busch, Inc. Supreme Int’l Corp., 167 F.3d 417,
419 (8th Cir. 1999) (affirming dismissal of federal lawsuit in Missouri where the
3 This opinion should not be read to decide any choice-of-law issue; we refer to 18 Del. C. § 2704(g) only to identify the relative weight of Delaware’s connection to the litigation, and the possible tactical reasons for Financial Credit’s filing of this action in Missouri.
15 plaintiff filed its declaratory judgment action after receiving notice that adverse party intended to file its own lawsuit).
It is also significant that Financial Credit’s initial petition primarily sought
a declaratory judgment that the Policy was lawfully issued (and secondarily, indemnification for the costs it had incurred in defense of the Estate’s lawsuits
which claimed the contrary). The fact that Financial Credit primarily sought
declaratory relief “merits a closer look, as such an action may be more indicative
of a preemptive strike than a suit for damages or equitable relief.” Nw. Airlines,
Inc. v. Am. Airlines, Inc., 989 F.2d 1001, 1007 (8th Cir. 1993) (citation omitted).
Financial Credit had received the death benefit under the Policy; it was seeking to retain those monies. The Estate, on the other hand, was seeking to upset the
status quo; the Estate was seeking affirmative relief in the form of payment to it
of the Policy’s proceeds. Thus, the circuit court could justifiably conclude that the
Estate was the “true plaintiff” in this scenario, and that Financial Credit had filed
a defensive action in an attempt to preempt the Estate’s choice of forum. Given
18 Del. C. § 2704(g), which would appear to require the application of Delaware’s
insurable-interest law to the Policy, the circuit court could also properly
determine that Financial Credit had filed its Missouri action in an exercise of
forum-shopping, to evade the potential application of Delaware law in the Delaware Action. See footnote 3, above.
Delaware law appears to be well-developed with respect to the legal issues
underlying this dispute. In the last several years, Delaware courts have issued multiple decisions addressing the legality of policies like the one insuring Georgia
Towers’ life, and the remedies in the event such a policy is found to be unlawful.
16 See Wilmington Tr. v. Sun Life Assur. Co. of Canada, 294 A.3d 1062 (Del. 2023); Geronta Funding v. Brighthouse Life Ins. Co., 284 A.3d 47 (Del. 2022); Wells
Fargo Bank, N.A. v. Estate of Malkin, 278 A.3d 53 (Del. 2022); Lavastone
Capital LLC v. Estate of Berland, 266 A.3d 964 (Del. 2021); PHL Variable Ins. Co. v. Price Dawe 2006 Ins. Tr., 28 A.3d 1059 (Del. 2011); Lincoln Nat’l Life Ins.
Co. v. Joseph Schlanger 2006 Ins. Tr., 28 A.3d 436 (Del. 2011). Delaware
apparently has a strong public policy interest in addressing issues involving
STOLI policies; the Delaware Supreme Court has observed that “STOLI
arrangements are unique in that they are not simply void ab initio, anathema to
hundreds of years of public policy, or violative of the Delaware Constitution, but they boast all three of these unenviable qualities.” Estate of Malkin, 278 A.3d at
65 n.48.
Financial Credit argues that comity is inapplicable because the parties and
issues are not perfectly aligned between the Jackson County lawsuit, and the
Minnesota and Delaware Actions. Comity is “not intended to be rigid,
mechanical, or inflexible, but should be applied in a manner serving sound
judicial administration.” Orthmann v. Apple River Campground, 765 F.2d 119,
121 (8th Cir. 1985). Federal caselaw holds that comity principles may be applied
“when the parties in the two actions ‘substantial[ly] overlap,’ even if they are not perfectly identical.” Baatz v. Columbia Gas Transmission, LLC, 814 F.3d 785,
790 (6th Cir. 2016) (quoting Save Power Ltd. v. Syntek Fin. Corp., 121 F.3d 947,
950–51 (5th Cir.1997)). Moreover, application of comity principles is appropriate even when the issues are not identical, so long as the issues are “materially on all
fours” and “have such an identity that a determination in one action leaves little
17 or nothing to be determined in the other.” Baatz, 814 F.3d at 791 (cleaned up; affirming application of federal comity even when one party later added
additional claims of conversion and unjust enrichment). For reasons we have
explained, the issues and parties between the Minnesota, Delaware, and Jackson County were sufficiently similar to support the circuit court’s exercise of its
discretion to dismiss Financial Credit’s case.
On appeal, Financial Credit complains that the Estate’s motion to dismiss
or stay raised disputed factual issues, and that it should have been given the
opportunity to conduct discovery and present live testimony before the court
dismissed the petition. But Financial Credit never argued in the circuit court that the court should delay ruling on the Estate’s motion to permit further factual
development to occur. Generally, “[a]rguments not raised before the trial court
are not preserved for review on appeal because we will not convict a trial court of
error on an issue that was not put before the trial court to decide.” Irving v.
Angstrom, 702 S.W.3d 248, 258 (Mo. App. W.D. 2024) (cleaned up).
In its briefing, Financial Credit emphasizes the fraud and unjust
enrichment claims which it asserted in the amended petition it filed on December
18, 2023. But Financial Credit only asserted those claims after the plaintiff-
estates had amended their complaint in the Delaware Action to specifically name Financial Credit as a defendant. The circuit court could properly give diminished
weight to claims Financial belatedly added to its petition, in an apparent effort to
bolster its claim that the dispute should be adjudicated in Missouri rather than in Minnesota or Delaware.
18 Given the circumstances in this case, the circuit court did not abuse its discretion in deciding, in the interest of interstate comity, to dismiss Financial
Credit’s Jackson County lawsuit, in deference to the earlier-filed suits pending in
Minnesota and Delaware. We offer one final caveat: the Estate moved to dismiss Financial Credit’s
petition, or in the alternative for a stay pending resolution of the Minnesota and
Delaware Actions. Financial Credit does not challenge the circuit court’s decision
to dismiss the case without prejudice, rather than to stay the action. We
accordingly do not address whether a dismissal without prejudice, or instead a
stay, was the appropriate remedy once the circuit court concluded that considerations of comity justified deference to the Minnesota and Delaware
Actions.
Conclusion The circuit court’s judgment is affirmed.
_______________________ Alok Ahuja, Judge All concur.