Blankenship v. Alpha Appalachia Holdings, Inc., C.A. No. 10610-CB (Del. Ch., May 28, 2015). This is the latest Chancery decision in a long series of recent Delaware decisions (and one of two opinions handed down today), rejecting defenses to advancement claims by former directors and officers. At least one member of the Court of Chancery regards advancement claims as the bane of his docket. This 66-page opinion might reveal hints about why. One might paraphrase the introduction to this opinion with the following colloquial expression of exasperation: Here we go again–another company trying to evade its advancement obligations.

The facts of the case involve the former CEO of a coal mining company defending a criminal indictment related to the death of 29 minors in a coal mining accident in West Virginia. The court granted advancement in the amount of nearly $6 million (for the last few months of legal fees) as well as fees on fees for the current proceeding. The company stopped making advancement payments a few months ago based in part on the argument that the former CEO did not fulfill a condition in an agreement providing the terms of advancement.

Executive summary of takeaway from this and other recent Chancery opinions: If a company hopes to defend an advancement claim based on a condition precedent in an agreement, or a “carve-out” from coverage, the terms of that condition must be beyond unambiguous, because all doubts will be resolved in favor of the claimant. Although prerequisites to advancement are not per se prohibited, see, e.g., older case highlighted here, some restrictions on advancement are considered void as being contrary to the mandatory nature of DGCL Section 145. See, e.g., recent decision highlighted here on these pages.

Aside: Another indication of the judicial frustration that might be gleaned from this Chancery decision (and others) regarding a company’s challenge to a claim for advancement, is the court’s choice of words to describe the company’s arguments made by one of the most respected and most able Chancery practitioners: nonsensical, absurd, unreasonable, not logical. One message that might deduced: Proceed with caution when challenging an advancement demand if you would prefer not to have those words (or worse) associated with your arguments.

Supplement: For further treatment of this decision, Kevin LaCroix provides characteristically insightful commentary on his highly regarded blog at this link.