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was overbroad in delaying indefinitely actions against tortfeasors to which
the insurer was not a party. The Court distinguished Ex Parte United
Equitable Life Ins. Co., 595 So. 2d 1373 (1992), which entered an indefinite
stay issued by an Illinois insolvency court and prohibited the contravention
of an action against the insurer itself, on the ground that the insolvent
insurer was not a party in Noble Trucking.
In re United Equitable Life Insurance Company, 595 So.2d 1373 (Ala. 1992). The
state supreme court held that the rehabilitation order entered in Illinois
restricting an insolvent insurance company from paying any claims to
policyholders entered in Illinois stayed litigation over entitlement to policy
proceeds in the Alabama court. The appellate court took the unusual step of
issuing a writ of mandamus to preclude the state court judge from entering a
judgment against the insolvent insurer while it was under a rehabilitation
order.
Moody v. State ex rel. Payne, 295 Ala. 299, 329 So.2d 73 (1976). When the
insurance commissioner, as receiver of an insolvent company, obtained an
injunction restraining the president of the insolvent insurer and others from
filing any lawsuits or claims relating to the affairs of the insolvent insurer, the
court held that receivership court may require that any party seeking to bring
action against receiver first obtain permission of receivership court, and that
state court could restrain proceeding in federal court where action was not
truly in personam, but was an attempt to remove assets from the estate of the
insolvent insurer.
Arkansas
Baldwin‐United Corp. v. Garner, 283 Ark. 385, 678 S.W.2d 754 (1984). The
insurance commissioner, as receiver of three insolvent insurance companies
owned by one corporation, proposed a rehabilitation plan which was approved
by the court. The parent corporation appealed the plan's provisions that: (i)
the rehabilitation court had exclusive jurisdiction over the assets of the
companies, and (ii) the rehabilitation court would refuse to honor a judgment
obtained in any other forum. In affirming the lower court's decision, the
Supreme Court of Arkansas announced that nothing contained in the
McCarran‐Ferguson Act or the Bankruptcy Act prohibits a state from
determining the rights of an insurance company's creditors. Furthermore, the
appellate court added, the lower court properly ordered that all claims to the
companies' assets be adjudicated in the rehabilitation court.
California W. J. Jones & Son v. Independence Indemnity Company, 52 Cal. App. 2d 374,
126 P.2d 463 (1942). In dicta, the appeals court stated that the court which
granted the liquidation order was authorized to issue such other injunctions or
orders as may be deemed necessary to prevent the obtaining of preferences,
judgments, attachments, or other liens against such person or its assets.
Colorado Herstam v. Bd. of Dir. of Silvercreek Water Sanitation Dist., 895 P.2d 1131
(Colo. App. 1995). Since the grant or denial of a preliminary injunction is a
decision that lies within the sound discretion of the trial court, an appellate
court reviewing the issuance of the injunction will substitute its judgment for
that of the trial court only if the trial court’s ruling was manifestly
unreasonable, arbitrary, or unfair. The trial court did not exceed its authority
in granting the receiver’s motion for preliminary injunction, since C.R.S. § 10‐
3‐505(1) grants the court broad authority to enjoin numerous acts, including
interference with the receiver and the institution or further prosecution of
any actions or proceedings.