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company. The court also found that the Canadian Winding Up Act does not
offend Illinois public policy, as both seek to conserve the assets of insolvent
insurers and to promote equal treatment of claimants.
Schacht v. Baccala & Shoop Ins. Serv., 1993 U.S. Dist. LEXIS 16093 (N.D. Ill.
Nov. 10, 1991). Where a Rehabilitator asserts civil RICO violations, it is the
injury that the plaintiff sustains, not the racketeering activity, that triggers
the statute of limitations. A determination of when the Rehabilitator or
Centaur sustained its injury, or when it knew or reasonably should have
known of its injury is a question of fact and therefore, is not dispositive at a
motion to dismiss. To invoke the protections of equitable tolling, the
plaintiff must show that it exercised "due diligence" in discovering the
essential information bearing on its claim.
Tribune Co. v. Swiss Reinsurance. Am. Corp., 2003 WL 22282465 (N.D. Ill. Sept.
30, 2003). Company filed breach of contract action against allegedly nominal
reinsurer after insurer entered liquidation. Under a principal‐agent relationship
theory, company claimed that contracts between insurer and reinsurer where
assumption agreements rather than reinsurance. Reinsurer moved to dismiss
action based on insurer’s liquidator’s failure to join under Fed. R. Civ. P. 19.
Under company’s theory, the court found that complete relief could be
according between the parties to the suit because such a principal would be
jointly and severally liable to the third‐party company. Additionally, the court
found that liquidator’s decision to forgo intervention indicated a lack of need
to join the liquidator. The court concluded that if company could show that
reinsurer was the true obligor to it, liquidator will have no reason to bring suit,
precluding risk of reoccurring or inconsistent obligations.
Kentucky Minor v. Stephens, 898 S.W.2d 71 (Ky. 1995). The Supreme Court of
Kentucky concluded that the trial court’s primary role is a supervisory one,
and the standard of review of a rehabilitator’s actions is abuse of discretion.
Missouri Robertson v. Manufacturing Lumberman's Underwriter, 346 Mo. 1103, 145
S.W.2d 134 (1941). In an appeal by attorneys who had been removed as
representatives for the liquidator of a Missouri reciprocal exchange, the
liquidator challenged the appellate rights of the attorneys, who had been
awarded $3,500 in legal fees on a petition requesting $50,000. The court
rejected the liquidator's theory that the attorneys were not permitted to
appeal since the statute provides a right of appeal in liquidation cases, and
further, that the appellate court could review the petition for attorney's fees
de novo.
New Jersey
New York
Chandler v. Omnicare/HMO, Inc., 756 F. Supp. 187 (D.N.J. 1990). The New
Jersey District Court dismissed (1) an action brought by a terminated employee
against the former employer's insolvent health insurer (Omnicare/The HMO,
Inc.) for continuation of health insurance coverage and damages; and (2) a
cross‐claim by the former employer against the insurer in rehabilitation on
Burford abstention grounds. The court found that New Jersey has a complex
and thorough regulatory scheme to rehabilitate insolvent insurers which can
best be accomplished without interference from outside courts that would
simultaneously dissipate the insolvent insurer's assets.
Ario v. U.S. Mgmt., Inc., No. 05CV3486SLT RML, 2007 WL 3047094 (E.D.N.Y.
Oct. 17, 2007), reconsid. denied, 2007 WL 3047094 (E.D.N.Y. Oct. 17, 2007). In
the liquidator’s action to recover insurance premiums allegedly owed to the
insurance companies and after pre‐motion discovery, the court denied the