Little River Landing LLC v. Allstate Vehicle and Property Insurance Co.

• Court: Court of Chancery of Delaware
• Decided: May 5, 2022
• Docket: CA No. 2021-0012-SEM
• Status: Published

Opinion

COURT OF CHANCERY OF THE SAM GLASSCOCK III VICE CHANCELLOR STATE OF DELAWARE COURT OF CHANCERY COURTHOUSE 34 THE CIRCLE GEORGETOWN, DELAWARE 19947

May 5, 2022

Richard E. Berl, Jr., Esquire Arthur D. Kuhl, Esquire Hudson, Jones, Jaywork & Fisher, LLC Reger Rizzo and Darnall LLP 34382 Carpenter’s Way, Suite 3 1521 Concord Pike, Suite 305 Lewes, DE 19958 Wilmington, DE 19803

RE: Little River Landing LLC v. Allstate Vehicle and Property Insurance Co., C.A. No. 2021-0012

Dear Counsel:

This matter involves a Defendant insurer (the “Insurer”) which issued a policy

of insurance for a dwelling on real property in Kent County, owned by the Plaintiff

LLC (the “LLC”). Unfortunately, and presumably mistakenly, the Insurer issued the

insurance in the name of the sole member of the LLC, and her husband, who do not

own the property. The member paid premiums on the policy monthly. The structure

burned; the LLC sought its benefits, and the Insurer denied coverage. This action,

in part, seeks an equitable reformation of the policy, which, again, purports to

provide coverage to non-owners, rather than the owner, the LLC. According to the

complaint, the Insurer knew or had reason to know the identity of the true owner of

the property. The Complaint seek relief on a variety of grounds, but a reformation

of the contract is, presumably, a predicate for each. The Insurer moved for dismissal

under Rule 12(b)(6), on the ground that the Complaint did not state a cognizable claim for reformation. The Master recommended denial of the motion in a final

report dated August 31, 2021; the Insurer has taken exceptions, which I address in

this Letter Opinion.

I have reviewed the Master’s well-reasoned final report, together with the

briefing of the parties. The issues are legal ones, not factual, and I may do a review

on the record—which at this pleading stage is not in dispute—to fulfill my duty to

consider these issues on exception, under DiGiaccobe v. Sestak. 1

Upon review, the Master’s conclusion that the Motion to Dismiss should be

denied is manifestly correct as a matter of law. Accordingly, the Insurer’s

Exceptions are DENIED. It is so ordered. Additionally, in the interest of litigants’

and judicial economy, any future exceptions to interlocutory Master’s Reports or

orders in this matter, if timely filed by a party, are stayed pending a final

recommendation by the Master.

To the extent to forgoing requires an order to take effect, IT IS SO

ORDERED.

Sincerely,

/s/ Sam Glasscock III

Sam Glasscock III

cc: All counsel of record (by File & ServeXpress)

1 743 A.2d 180 (Del. 1999). 2