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entities were in fact a "single business enterprise," the liquidator was vested
with the defendants' assets by operation of law, and no further actions, such
as writs of seizure, were necessary to bring those assets into the liquidation
proceeding. The court rejected the claim that the liquidator was thereby
regulating non‐insurer corporations, finding the order was simply in
furtherance of the liquidator's duty to marshal the assets that are properly
included in the liquidation. The court squarely held that the insurance code
which authorizes the issuance of an injunction restraining, inter alia, "all other
persons from transacting any insurance business or disposing of its property,"
is intentionally broad to ensure that the jurisdiction of the liquidation court
extends to persons or entities such as defendants, who may have access,
control, or possession of the insurer's assets. Finally, the court held that it was
not required to stay the civil action pending the outcome of the criminal
proceedings filed against various individuals, because to do so would prejudice
the liquidator's civil remedy against those persons.
Green v. Louisiana Underwriters Insurance Company, 571 So.2d 610 (La. 1990).
Attorney General claimed that the statute authorizing his office to appoint
private attorneys in state matters was applicable in those instances in which
the Insurance Commissioner was acting in his capacity as liquidator,
conservator or rehabilitator of an insolvent insurance company. The
Commissioner claimed that the statute which authorized the employment of
attorneys by him in matters of insurer insolvency controlled. The court held
that the more specific insurance statute, although adopted prior to the
attorney general statute, controlled.
LeBlanc v. Bernard, 554 So.2d 1378 (La. App. 1st Cir. 1989), writ den'd, 559 So.2d
1357 (La. 1990). Plaintiff sold immovable property to an individual who
immediately transferred the property to Commonwealth Securities
Corporation ("Commonwealth"), which was wholly owned by the purchaser.
The Act of Sale recited that the purchase price had been paid in full.
Thereafter, Commonwealth was placed in liquidation. Plaintiff sued for
dissolution of the sale for the failure of purchaser to pay the purchase price, a
fact which was not disputed by the liquidator at trial. Plaintiff claimed that the
liquidator stood in the shoes of the buyer/transferee and was therefore
charged with knowledge that the purchase price had not been paid. The Court
relied upon the comprehensive and exclusive statutory scheme developed for
insurer insolvencies and held that the liquidator did not stand in the shoes of
the insurer for all purposes. Accordingly, in furtherance of his statutory duty to
marshal all assets of the insolvent's estate for the benefit of the public, the
liquidator was entitled to rely upon the public records which recited that the
purchase price had been paid.
Maryland
Massachusetts
Joyce v. Abrams, 178 Md. 535, 16 A.2d 296 (1940). In the liquidation of a mutual
casualty company, the court held that following the appointment of a receiver
to liquidate and wind up the affairs of the insolvent company, the directors of
the company were powerless to make valid assessments against members of
the company. Upon appointment, the receiver is vested with all corporate
powers. The court also held that the equity court having jurisdiction over the
insolvent company also had the power to make necessary assessments against
the members. The court further held that the assessment is a decree which
sets the rate of liability, but that the liability of each member assessed would
have to be established by the receiver before collecting the assessments.
Commissioner of Insurance v. Broad Street Mutual Casualty Ins. Co., 312 Mass.
261, 44 N.E.2d 683 (1945). The receiver of an insurance company is not subject