In the Matter of the Liquidation of United Contractors Insurance Company, Inc., a Risk Retention Group

COURT OF CHANCERY
OF THE
STATE OF DELAWARE
DAVID HUME, IV COURT OF CHANCERY COURTHOUSE
MAGISTRATE IN CHANCERY 34 THE CIRCLE
GEORGETOWN, DE 19947

Report: March 20, 2026
Date Submitted: March 12, 2026

Diane J. Bartels, Esquire Rejeanne M. Bernier
Brandywine Village 6792 Maury Drive
1807 N. Market St. San Diego, CA 92119
Wilmington, DE 19802

James J. Black, Esquire
Black & Gerngross PC
1617 John F. Kennedy Blvd., St. 1575
Philadelphia, PA 19103

RE: In the Matter of the Liquidation of United Contractors Insurance
Company, Inc., a Risk Retention Group
C.A. No. 8802-DH

Dear Ms. Bernier and Counsel:

This is a Report regarding Claimant Rejeanne Bernier’s Claim No. 964.02

after an Objection Hearing held on March 12, 2026. For the reasons below, I agree

with the Receiver’s assessment that Claim 964.02 should be valued at $0. 1 Bernier’s

Objection to the Claim is denied.

1
The parties submitted exhibit lists that I will refer to as Receiver’s Exhibits (RX _) and
Claimant’s Exhibits (CX_). References to the Draft Transcript shall be designated as Tr.
_.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 2 of 10

I. BACKGROUND

A. Rain damages Bernier’s home after a construction mishap and
litigation ensues
The facts are well-known to the parties. The circumstances that follow are

taken from Bernier’s Complaints in California Superior Court against her son, Jessie

Croteau (Croteau), Croteau’s company, ICS Professional Services (ICS), American

Contractors Indemnity Company, and later, Travelers Property Casualty Insurance

Company (Travelers). 2 United Contractors Insurance Company, Inc. (UCIC)

insured ICS. 3

Bernier claimed that she and Croteau orally agreed to construction work on

her home with a maximum cost of $300,000.4 Croteau agreed to do the construction

work personally because if ICS performed the construction, Croteau would have to

charge more than $300,000.5 Bernier also alleged that if a factfinder determined that

there was an oral contract between she and ICS, then she would claim breach of

contract.6 Croteau performed construction work on Bernier’s residence, but left the

2
RX 2, RX 10.
3
RX 1.
4
RX 2 at ¶¶ 8–9.
5
Id. ¶ 9.
6
Id. ¶¶ 14–15.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 3 of 10

job without reinstalling the roof.7 With the roof open, it rained and the home was

damaged. 8 After an eight-day trial, the California Superior Court found that Bernier

had not established a cause of action against Croteau and ICS. 9 The California

Superior Court found that although there was an “arrangement” to remodel Bernier’s

home, “neither side established what that arrangement was.”10 Bernier received

nothing from her complaint. 11 A decade of litigation followed across numerous

cases and courts between Bernier, Croteau, ICS, UCIC, and Travelers.12 The

litigation history is prolific. 13

B. PROCEDURAL HISTORY
This Court entered an order appointing the Delaware Insurance Commissioner

(“the Receiver”) as Receiver of an impaired and insolvent UCIC on August 21,

2013.14 The Commissioner’s appointment was required by law. See 18 Del. C. ch.

7
RX 10 at ¶ ¶20–23.
8
Id.
9
RX 6 at 3.
10
Id.
11
RX 7 at 2.
12
RX 18.
13
Id.
14
Receivership Order, D.I. 4.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 4 of 10

59. Bernier filed a proof of claim with the Receiver on March 12, 2014.15 The

Receiver filed its Twelfth Claim Recommendation Report on November 26, 2024.16

The Receiver’s Claim Recommendation contained two subparts related to Bernier.

In subpart 964.01, the Commissioner recommended full payment of Bernier’s claim

for $49,560 for property damage related to a sewer/water line installation.17 There

is no dispute for subpart 964.01. In subpart 964.02, the Receiver recommended a

payment of $0 for the portion of the claim related to Remodeling Litigation and

alleged concealment of the UCIC policy of ICS/Croteau.18 Bernier filed a timely

Objection to that Report on October 2, 2025.19 She argued that the “Receiver’s

concession, that Bernier’s sewer damages were never adjudicated, undermines its

position that Claim No. 964.02 was adjudicated.” 20 Bernier also bases her objection

in subpart 964.02 on the 2007 California lawsuit “tainted by a vexatious litigant

prefiling order entered in clear absence of all jurisdiction.”21 Bernier points to her

15
RX 10.
16
D.I. 153.
17
Id., Ex. 4 at 2.
18
Id., Ex. 4 at 3.
19
D.I. 177.
20
Id. at 2.
21
Id. at 1.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 5 of 10

collateral attacks on the California claim, including a federal lawsuit in Connecticut

that she contends requires this Court to hold a decision in abeyance.22 She also

attempts to inject a 2010 settlement between Croteau and UCIC into this legal

morass by suggesting that it was a fraud on the California court.23

II. ANALYSIS

When the Insurance Commissioner is appointed Receiver, the Court of

Chancery reviews the Insurance Commissioner’s claim recommendations under an

abuse of discretion standard. Matter of Scottish RE (U.S.), Inc., 2025 WL 3438318,

at *20 (Del. Ch. Nov. 28, 2025). The Commissioner has an initial burden to make

out a prima facie case. Id. at *10. To do so, “the Commissioner must identify a

source of authority, articulate a rationale for the requested relief, and create a factual

record that supports the proffered rationale.” Id. If the Commissioner establishes a

prima facie case, the burden shifts to the objector to “show that (i) the Commissioner

lacked authority to make the decision or that the decision does not otherwise comply

with applicable law, (ii) the Commissioner’s rationale does not have substantial

22
Id. at 2–3.
23
Id. at 2.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 6 of 10

evidentiary support, or (iii) the decision is an abuse of discretion.” Id. (internal

citations omitted).

The Receiver’s Notice of Determination of Claim (“the Notice”) identified

sources of authority including the UCIC insurance policy, documentation from

Travelers indicating payment to Bernier, and Judge Nevitt’s decision in the 2007

California case.24 The Notice also gave a detailed analysis of the Receiver’s

determination.25 The Receiver included the UCIC insurance policy, Travelers

documentation related to insurance payments to Bernier, and Judge Nevitt’s decision

in its Exhibits.26 The Receiver’s Exhibits provide a factual record supporting the

rationale for the $0 claim.

Bernier bears the burden of showing that the Receiver lacked authority to

make the decision, that the rationale does not have substantial evidentiary support,

or that the decision constitutes an abuse of discretion. See Scottish RE, 2025 WL

3438318, at *12.

24
RX 13 at 4–9.
25
Id.
26
RX 1, 3, and 6, respectively.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 7 of 10

Bernier’s Proof of Claim to the Receiver alleged that Jessie Croteau and ICS

concealed the existence of UCIC Contractors Insurance Company from Bernier.27

But Bernier does not explain how, even if true, concealment would permit a proper

claim against UCIC for her property damage. Bernier admits in her California filings

that she agreed to the construction work with Croteau individually, and not UCIC’s

insured, ICS.

Even if UCIC had sufficient connection with Bernier where liability could be

considered, UCIC’s contract with ICS contains an exclusion that precludes liability

for property damage arising out of breach of contract 28—Bernier’s exact legal theory

in the 2007 California case. Bernier has failed to prove that she had a viable claim

to UCIC’s coverage.

Bernier claims that the Receiver’s decision to pay the full claim subpart

964.01 undermines its decision determining that subpart 964.02 is valued at $0. But

she does not explain her argument. The Receiver arrived at different valuations for

each subpart. Subpart 964.01 related to sewer/water line damage. Subpart 964.02

was for other remodeling and alleged concealment. Bernier has presented no

27
RX 10 at 7.
28
RX 1 at 19.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 8 of 10

evidence that the determination in subpart 964.01 affects the recommendation in

subpart 964.02. Bernier does not meet her burden for this argument.

Bernier is preoccupied with UCIC’s lack of attentiveness to the plight of her

home. In the Claim Hearing, she told the Court that UCIC failed to send anyone to

inspect her property.29 This nonperformance was a focus for Bernier but bears no

relevance to the viability of her claim or any failure by the Receiver. She has failed

to prove concealment. Even if she could prove concealment, she has not proven how

UCIC, the insurer for ICS, would be responsible for compensating her for any

damages.

Bernier contends that Judge Nevitt’s decision in the 2007 California Superior

Court case does not preclude her from establishing a claim against UCIC because

Judge Nevitt determined that there was an “arrangement” between Bernier and

Croteau without finding what the arrangement was. Bernier argues that she should

be able to present evidence of that arrangement now.

Bernier is wrong. An “arrangement” is not a contract and not one that binds

UCIC. Under California law, contract terms must be certain and definite. Colo.

Corp. v. Smith, 263 P.2d 79, 81 (Cal. Ct. App. 1953). Judge Nevitt determined that

29
Tr. 20:3–15.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 9 of 10

neither side established a cause of action.30 He also held that neither Bernier nor

Croteau proved what their “arrangement” was. The bar to prove a contract is even

higher than for an arrangement, and Bernier failed. Such scarce details do not create

liability for UCIC.

Bernier had a full eight-day trial to prove an arrangement and contract that

would implicate UCIC. She had her day in court and failed to prove her case. As

Judge Nevitt wrote, “The stories told by Ms. Bernier and Mr. Croteau were both

false. Mother and son each seemed to be trying to tell a more convincing set of lies

than the other one.” 31 This is underscored by Bernier’s own pleadings where she

alleged an oral agreement with Croteau but specifically not ICS because Croteau

offered her a better price if he did the work personally. 32 As she alleged, she would

seek a breach of contract claim if a factfinder determined ICS was in breach.33 Judge

Nevitt did not so find.

As the Receiver suggests, the evidence also shows that Travelers compensated

Bernier for damages. A letter dated October 10, 2007, addressed to Croteau, sought

30
RX 6 at 2.
31
Id.
32
RX 2 at ¶¶ 8–9.
33
Id. at ¶¶ 14–15.
In the Matter of UCIC,
C.A. No. 8802-DH
March 20, 2026
Page 10 of 10

reimbursement of $8,709.83 paid to Bernier for property damage to her home caused

by a rainstorm on August 26, 2007.34 Bernier has presented no evidence to

contradict that Travelers compensated her for damages to her home.

III. CONCLUSION

This matter is the latest in a long-running series of frequently frivolous

lawsuits and filings disreputably linked to the California rainstorm incident in 2007.

Sadly, the inability to let go has led to a fracture of the Bernier/Croteau family unit.

The time has come to move on. For the reasons explained above, I recommend that

the Commissioner’s Claim Recommendation be accepted, and Bernier’s objection

be denied. This is a Final Report under Court of Chancery Rule 144.

Sincerely,

/s/ David Hume, IV

David Hume, IV
Magistrate in Chancery

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

34
RX 3.