Opinion
No. 270, 2000.
Decided: June 9, 2000.
Appeal refused.
Unpublished Opinion is below.
CONTOUR ENERGY CO., Defendant-Below, Appellant v. WESTERN FINANCIAL CO., Plaintiff-Below, Appellee. No. 270, 2000. In the Supreme Court of the State of Delaware. Submitted: June 7, 2000. Decided: June 9, 2000.
Court of Chancery of the State of Delaware, in and for New Castle County, C.A. No. 17879.
Before VEASEY, Chief Justice, WALSH and BERGER, Justices.
ORDER
This 9th day of June 2000, it appears to the Court that:
(1) Contour Energy Co., defendant-below, appellant ("Contour") has petitioned this Court under Supreme Court Rule 42 to accept an interlocutory appeal of an order entered on June 2, 2000, by the Court of Chancery.
(2) The Court of Chancery, with reservations, certified to this Court the interlocutory appeal of its order.
(3) Western Financial Co., plaintiff-below, appellee ("Western") opposes the acceptance by this Court of the interlocutory appeal.
(4) The interlocutory order provided equitable relief to Western in the implementation of the rights of the preferred stockholders of Contour to elect two directors as provided in the Certificate of Designation of Contour.
(5) Interlocutory appeals are accepted only in exceptional circumstances and when the criteria of Supreme Court Rule 42 are satisfied.
(6) The certification of the interlocutory appeal by the Court of Chancery finds that its order determines substantial issues and establishes legal visits and, further, that review of its interlocutory order "will serve considerations of justice."
(7) This Court finds that the interlocutory order determined substantial issues and established legal rights of the preferred stockholders in that they have the right clearly guaranteed by the Certificate of Designation to elect two directors. This right arises out of the uncontested fact that, as of the triggering date of May 1, 1999, Contour had not paid six quarterly dividends on the preferred stock. This determination alone does not support the acceptance of the interlocutory appeal.
(8) Contour argues, however, that the implementation details of the interlocutory order are "unprecedented" and not expressly provided in the Certificate of Designation of the preferred stock. Therefore, it is argued, the order gives rise to the need for urgent review by this Court in order to serve considerations of justice.
(9) We find, however, that nothing in the interlocutory order implies rights in the preferred stock itself beyond those expressly stated in the Certificate of Designation. See Elliott Assocs. L.P. v. Avatex Corp., Del. Supr., en Banc, 715 A.2d 843 (1998). The interlocutory order merely fashions a remedy within the discretion of a court of equity to implement the rights of the preferred stockholders that are clearly set forth in the Certificate of Designation. We do not find that Kaiser Aluminum Corp. v. Matheson, Del. Supr., 681 A.2d 392 (1996), has any application to the narrow issue presented here of the discretionary power of a court of equity to fashion equitable relief to implement the established rights of the preferred stockholders.
(10) Review of such an interlocutory order does not meet the criteria of Supreme Court Rule 42 under the circumstances of this case.
NOW, THEREFORE, IT IS ORDERED that the within interlocutory appeal is REFUSED.