Delaware Bills

The Division of Forensic Science (“Division”) produces numerous postmortem examination reports, autopsy reports, and laboratory reports annually. Given the high volume, and consistent with National Association of Medical Examiners accreditation standards, this Act expands the period of time within which the Medical Examiner must complete a written report from 30 to 90 days. In addition, while “next of kin” is defined for purposes of the authority to provide corneas to eye banks, other references to “next of kin” in Chapter 47 of Title 29 (regarding the Division’s authority) are undefined. This Act provides a clear definition for Division employees and the public regarding who qualifies as “next of kin” and is intended to ensure that the confidential reports prepared by the Division are released only to the appropriate individual.

This Act includes Probation and Parole Officers in the Department of Services for Children, Youth and their Families under the definitions of Law-Enforcement Officer under the Law-Enforcement Officer’s Bill of Rights.

Section 1 of this Act increases the aggregate amount of Neighborhood Assistance Tax Credits that can be approved in any 1 fiscal year from $500,000 to $1 million. Section 1 of this Act also makes a technical correction to use “persons,” which is a defined term for purposes of the Neighborhood Assistance Tax Credit, instead of “firms,” which is not defined, and to conform existing law to the standards of the Delaware Legislative Drafting Manual. Section 2 of this Act provides the Delaware State Housing Authority with funds to administer the Neighborhood Assistance Tax Credit program.

Section 1. Section 1 of this Act amends Section 102(a)(1) to provide that the name of a corporation must be such as to distinguish it from the name of any registered series of a limited liability company. Section 2. Sections 2 and 3 of this Act amend Section 114. Section 114 translates the provisions of Title 8, to determine which provisions apply to nonstock corporations. As amended, Section 114 allows nonstock corporations to use the provisions of Sections 204 and 205 to ratify defective corporate acts. Section 3. Sections 4 through 8 of this Act amend Section 204. The addition of new Section 204(c)(2) confirms that Section 204 remains available for use in ratifying defective corporate acts in circumstances where no valid stock is outstanding, consistent with the existing provisions of Section 204 specifying that only valid stock is entitled to vote on the ratification of a defective corporate act that requires or required a vote of stockholders. The changes to Section 204(d) clarify that, in cases where a vote of stockholders is being sought for the ratification of a defective corporate act at a meeting of stockholders, the notice that is required to be given to holders of valid stock or putative stock as of the time of the defective corporate act may be given to the holders of valid stock or putative stock as of the record date for the defective corporate act if such defective corporate act involved the establishment of a record date. Section 204(g) is also being amended to provide that public companies may give such notice through disclosure in a document publicly filed with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Securities Exchange Act of 1934. Section 204(h)(1) is being amended to clarify and confirm that any act or transaction that a corporation takes that is within its power under subchapter II of the Delaware General Corporation Law (i.e., any act or transaction other than those that are expressly denied, such as the power of issuing bills, notes, or other evidences of debt for circulation as money, or carrying on the business of receiving deposits of money) may be subject to ratification under Section 204 if such act or transaction was void or voidable due to a "failure of authorization." The amendments to Section 204(h)(1) are intended to eliminate any implication from Nguyen v. View, Inc., C.A. No. 11138-VCS (Del. Ch. June 6, 2017), suggesting that an act or transaction may not be within the power of a corporation—and therefore may not constitute a "defective corporate act" susceptible to cure by ratification—solely on the basis that it was not approved in accordance with the provisions of the Delaware General Corporation Law or the corporation's certificate of incorporation or bylaws. The amendments would not, however, disturb the power of the Court of Chancery to decline to validate a defective corporate act that had been ratified under Section 204, or to declare invalid any defective corporate act, on the basis that the failure of authorization that rendered such act void or voidable involved a deliberate withholding of any consent or approval required under the Delaware General Corporation Law, the certificate of incorporation or bylaws, nor would it limit, eliminate, modify or qualify any other power expressly granted to the Court of Chancery under Section 205 of the Delaware General Corporation Law. Section 204(h)(2) is being amended to make clear that the failure of an act or transaction to be approved in compliance with the disclosure set forth in any proxy or consent solicitation statement may constitute a failure of authorization. Section 4. Sections 9 and 10 of this Act amend Section 262. The amendments to Section 262(b) will apply the "market out" exception to the availability of statutory appraisal rights to "intermediate form" mergers effected pursuant to Section 251(h). As currently drafted, Section 262(b)(3) provides that, if all of the stock of a subsidiary Delaware corporation party to a merger effected pursuant to Section 251(h) are not owned by the parent immediately prior to the merger, appraisal rights will be available for the shares of the subsidiary Delaware corporation, whether or not the market out exception would otherwise apply to an analogous "long form" merger, effectively ensuring that the market out exception will not be available to any exchange offer effected pursuant to Section 251(h). As amended, Section 262(b) will provide that, in the case of a merger pursuant to Section 251(h), appraisal rights will not be available for the shares of any class or series of stock of a target corporation that were listed on a national securities exchange or held of record by more than 2,000 holders as of immediately prior to the execution of the agreement of merger, so long as such holders are not required to accept for their shares anything except (i) stock of the surviving corporation (or depository receipts in respect thereof), (ii) stock of any other corporation (or depository receipts in respect thereof) that at the effective time of the merger will be listed on a national securities exchange or held of record by more than 2,000 holders, (iii) cash in lieu of fractional shares or fractional depository receipts in respect of the foregoing, or (iv) any combination of the foregoing shares of stock, depository receipts and cash in lieu of fractional shares or fractional depository receipts. The changes to Section 262(e) effect a technical clarifying change with respect to the statement required to be furnished by the surviving corporation thereunder. Currently, Section 262(e) requires the surviving corporation to provide, upon request and subject to specified conditions, a statement to dissenting stockholders setting forth the aggregate number of shares that were not voted in favor of the merger or consolidation and as to which demands for appraisal have been received, and the aggregate number of holders of such shares. The changes to Section 262(e) give recognition to the fact that, in the case of a merger effected pursuant to Section 251(h), no shares are "voted" for the adoption of the agreement of merger. Instead, if a requisite number of shares of a target corporation are tendered for purchase or exchange in a tender offer satisfying the requirements of Section 251(h), the merger of the target corporation may be effected without a vote of its stockholders. The amendment to Section 262(e) thus clarifies that the statement provided pursuant thereto in connection with a merger effected under Section 251(h) must set forth the relevant shares not tendered for exchange or purchase rather than the shares not voted for the merger. Section 5. Section 11 of this Act amends Section 284 to clarify that the Attorney General has the exclusive authority to move for the revocation or forfeiture of a charter of a corporation pursuant to Section 284. As amended, Section 284 also clarifies that, in light of electronic filing, the Attorney General may file a complaint seeking revocation or forfeiture in the Court of Chancery without regard to county. Section 284 is also amended to provide expressly that the Court of Chancery has the power to appoint a trustee to administer and wind up the affairs of a corporation whose charter has been revoked or forfeited pursuant to Section 284. Section 6. Section 12 of this Act amends Section 313(b) to reflect the current practice of the Office of the Secretary of State relating to the filing of certificates of revival for exempt corporations. Section 13 of this Act amends Section 502(a) to reflect the current practice of the Office of the Secretary of State relating to the filing of annual reports for exempt corporations. Section 7. Sections 14 through 17 of this Act relate to the effectiveness of the amendments to Title 8. Section 14 of this Act provides that Section 1 of this Act (relating to the amendments to Section 102(a)(1)) are effective on August 1, 2019. Section 15 of this Act provides that Sections 2 and 3 and Sections 11 through 13 of this Act (relating to the amendments to Sections 114, 284, 313(b) and 502(a)) are effective on August 1, 2018. Section 16 of this Act provides that Sections 4 through 8 of this Act (relating to the amendments to Section 204) are effective only with respect to defective corporate acts ratified or to be ratified pursuant to resolutions adopted by a board of directors on or after August 1, 2018. Section 17 of this Act provides that Sections 9 and 10 of this Act (relating to the amendments to Section 262) are effective only with respect to a merger or consolidation consummated pursuant to an agreement entered into on or after August 1, 2018.

This Act updates the Delaware Insurance Guaranty Association (DIGA) Act to more closely align it with the National Association of Insurance Commissioners (NAIC) and National Conference of Insurance Guaranty Funds (NCIGF) Model Acts. DIGA in a non-profit association, established under Chapter 42, Title 18 of the Delaware Code as a safety net to protect residents of this state when a covered property and casualty claim arises from an insolvency of a member insurance company. DIGA is fully funded by assessments levied on member insurance companies and remaining assets from insolvent insurance companies. Section 1 clarifies the types of insurance that do not fall under this chapter. Section 2 clarifies the definition of what is excluded from the definition of a “covered claim” and adds “ocean maritime insurance” to this chapter. Section 3 provides for an increase in the maximum amount of covered claims from $300,000 to $500,000 (workers compensation coverage remains unlimited) and specifies when the Association would be relieved of any obligation to defend an insured on a covered claim. Section 3 permits procedures to be established for DIGA to retrieve net worth information from an insured, with consequences if the information is not provided in a timely basis. Section 3 also provides DIGA with the ability to bring an action against any third-party administrator or other party who refuses to release information related to an insolvent company interfering with DIGA’s ability to carry out its duties. Section 3 also provides DIGA with the authority, subject to approval by the Commissioner, to provide claims-handling services to any “run-off insurer” provided the Association expenses related thereto are fully reimbursed. Section 4 renames § 4212 (formerly non-duplication of recovery) and clarifies that all other insurance coverage (excluding Medicare) is primary to DIGA coverage. Section 5 removes unecessary language regarding the Board of Director’s functions in relation to making recommendations on the status of member insurers. Section 6 provides the Board of Directors the right to request financial and other information from the liquidator, receiver, or statutory successor of an insolvent insurer covered by this chapter.

Currently, the age for wait staff to serve alcohol to a patron is 19 years old. This Act lowers the age of persons permitted to serve alcohol from 19 to 18 years of age for all establishments licensed for the on-premises sale and consumption of alcoholic liquor except taverns and taprooms.

The purpose of this Act is to clarify that registered agents in Delaware are obligated to comply with requirements, standards, guidelines, rules, regulations, and procedures as issued by the Secretary of State on matters involving filings submitted to the Secretary on behalf of corporations, partnerships, limited partnerships, and limited liability companies. This Act will enable the Secretary of State to adopt requirements, standards, guidelines, rules, regulations, and procedures for commercial registered agents regarding verification of customer entities. This Act also clarifies that such requirements, standards, guidelines, rules, regulations, and procedures which the Secretary issues are exempt from Chapter 101, Title 29 of the Delaware Code.

This Act amends the Workers’ Compensation Act to include a provision permitting Industrial Accident Board hearing notices and decisions to be sent by secure email with an electronic receipt in lieu of certified mail. This will save money for the State and time for the parties and their attorneys.

In December 2016, the federal Office of Child Support Enforcement issued final regulations titled "Flexibility, Efficiency, and Modernization in Child Support Enforcement Programs," 81 Fed. Reg. 93,492 (Dec. 20, 2016) (codified at 42 C.F.R Pt. 433). This Act updates to whom Delaware's Division of Child Support Services can send child support payments, in compliance with the federal regulations.

Section 1 of this Act transfers from the Department of Safety and Homeland Security to the Department of Health and Social Services the responsibility for establishing, administering, adopting rules and regulations, and setting fees for courses of instruction and programs of rehabilitation for those whose licenses have been revoked for driving a vehicle under the influence of alcohol or any drug, or both. The Department of Health and Social Services’ Division of Substance Abuse and Mental Health is better positioned to establish and operate programs aimed at treating substance abuse issues. Section 1 of this Act also makes technical corrections to conform existing law to the standards of the Delaware Legislative Drafting Manual and to update language in this Act that is no longer consistent with language in § 4177 of Title 21. Section 2 of this Act delays the Act’s effective date for 6 months.

This Act restores the Delaware Prescription Drug Payment Assistance Program (“Program”), which was eliminated in the Fiscal Year 2018 Annual Appropriations Act. This Act replaces Senate Bill 148 and makes the following additional changes: (1) Delays implementation of the Act until January 1, 2019, to coordinate with the Medicare Part D benefit year to enable the Department of Health and Social Services (“Department”) to make necessary system changes. (2) Makes changes to the defined term “prescription drugs.” (3) Removes provisions required to be included in rules and regulations promulgated by the Department. (4) Adds provisions that may be included in rules and regulations promulgated by the Department. (5) Makes technical corrections to conform the provisions of the restored Program to the standards of the Delaware Legislative Drafting Manual.

This Act creates a special license plate to honor Delaware women’s military service and commemorate the unveiling of the Delaware Women’s Military Service Monument.