Geronta Funding v. Brighthouse Life Insurance Co.

• Court: Supreme Court of Delaware
• Decided: March 28, 2019
• Docket: 103, 2019
• Status: Published

Opinion

IN THE SUPREME COURT OF THE STATE OF DELAWARE

§ GERONTA FUNDING, a Delaware § statutory trust, § No. 103, 2019 § Defendant-Counterclaim § Court Below—Superior Court Plaintiff Below, § of the State of Delaware Appellant, § § C.A. No. N18C-04-028 v. § § BRIGHTHOUSE LIFE § INSURANCE COMPANY, § § Plaintiff-Counterclaim § Defendant Below, § Appellee. §

Submitted: March 15, 2019 Decided: March 28, 2019

Before VAUGHN, SEITZ, and TRAYNOR, Justices.

ORDER

After considering the notice of appeal and supplemental notice of appeal from

an interlocutory order under Supreme Court Rule 42, it appears to the Court that:

(1) This interlocutory appeal arises from a Superior Court bench ruling and

opinion granting in part and denying in part cross-motions for judgment on the

pleadings. As requested by both parties, the Superior Court held that a life insurance

policy issued by the appellee, Brighthouse Life Insurance Company, to a fictitious

individual and later purchased by Geronta Funding on the secondary market was void ab initio. The Superior Court denied Geronta Funding’s request for rescission

of the insurance policy and a full refund of all paid premiums, finding that rescission

of a void contract is not available under Delaware law. The Superior Court denied

Brighthouse’s request to leave the parties as they were, finding that Brighthouse

might be unjustly enriched if it could keep all of the paid premiums and therefore

restitution might be an appropriate remedy. The Superior Court also found that

further development of the record was necessary to determine if Brighthouse had an

offset claim.

(2) On February 22, 2019, Geronta filed an application for certification of

an interlocutory appeal. Geronta argued that certification was appropriate because,

among other things, the opinion resolved a question of law decided for the first time

in Delaware, the opinion conflicted with decisions of the United States District Court

for the District of Delaware, and interlocutory review could terminate the litigation.

Brighthouse opposed the application. On March 19, 2019, the Superior Court denied

the application for certification. The Superior Court found that its decision followed

Delaware law, there was no conflict in the decisions of the state courts, the decisions

of the Delaware District Court were distinguishable, and interlocutory review would

not terminate the litigation because even if the insurance policy was rescinded,

Brighthouse’s offset claim had to be resolved.

2 (3) We agree that interlocutory review is not warranted in this case.

Applications for interlocutory review are addressed to the sound discretion of the

Court.1 In the exercise of its discretion, this Court has concluded that the application

for interlocutory review does not meet the strict standards for certification under

Supreme Court Rule 42(b). The case is not exceptional,2 and the potential benefits

of interlocutory review do not outweigh the inefficiency, disruption, and probable

costs caused by an interlocutory appeal.3

NOW, THEREFORE, IT IS HEREBY ORDERED that the interlocutory

appeal is REFUSED.

BY THE COURT:

/s/ Collins J. Seitz, Jr. Justice

1 Supr. Ct. R. 42(d)(v). 2 Supr. Ct. R. 42(b)(ii). 3 Supr. Ct. R. 42(b)(iii). 3