Download PDF - Goodmans

Mendel v. Garner, 283 Ark. 473, 678 S.W.2d 759 (1984). Policyholders of an
insolvent carrier appealed a provision in the rehabilitation plan that cut off
their rights to surrender their policies for the cash surrender value. In
upholding the plan, the Supreme Court of Arkansas held: "The rehabilitation of
insurance companies pursuant to state insolvency statutes does not impair the
obligation of contracts." 678 S.W.2d at 761.
California W.J. Jones & Son v. Independence Indemnity Company, 52 Cal. App. 2d 374, 126
P.2d 463 (1942). Appellant insurer had a claim against the bank, at the same
time the appellant was in receivership. Appellant attempted to levy on the
attached party but the property had been delivered to the International
Reinsurance Corporation. Thereafter, the appellant obtained a judgment
against the reinsurer and filed a writ of execution on any sums or credits due
from the bank. After the appellant filed its writ, a court appointed the
insurance commissioner liquidator for International, the reinsurer. The
appellate court found that appellant's execution had ceased and that its lien of
attachment had ended by the time of the appeal and therefore, appellant had
no claim of International against the bank. Although the insurer had an
attachment lien on the date of the order of liquidation, the attached lien
expired when insurer failed to act on it.
Florida
Bartholomew v. Glens Falls Ins. Group, 241 So.2d 698 (Fla. App. 1970), cert.
dismissed, 262 So.2d 680 (1972). The Arkansas insurance commissioner's
proceedings declaring insurer insolvent and appointing receiver were not
determinative of date of insolvency for purposes of Florida uninsured motorist
coverage, although the Florida commissioner had recognized the same date in
ancillary proceedings. Plaintiff could present proof that the date of actual
insolvency was earlier.
State Farm Mutual Automobile Ins. Co. v. Fass, 243 So.2d 223 (Fla. App. 1971).
The court held that where the statute regulating uninsured motorist coverage
provides for coverage where the liability insurer "becomes insolvent" within
one year after the accident, the date of actual insolvency could be proved to
be different than the date of adjudication of insolvency.
William v. Gottlieb, 249 So.2d 425 (Fla. 1971). When the Florida insurance
commissioner became receiver of an insolvent Florida insurer on April 2, 1969,
the court issued an injunction prohibiting all garnishments, etc., against the
insolvent insurer. The plaintiff had obtained a judgment against the insolvent
insurer's bank account on March 28, 1969. The court held that the significant
judgment date was date of the original judgment, which was four months prior
to institution of the delinquency proceedings and therefore, garnishment was
not barred.
Georgia
Shaw v. Caldwell, 229 Ga. 87, 198 S.E.2d 684 (1972). The provision in the
insurance code fixing the rights and liabilities of an insolvent insurer as of the
date on which the liquidation order is filed did not bar plaintiff's claim, which
was merely unliquidated, and became liquidated and was presented to the
receiver before the last date for filing of claims. Plaintiff's action was filed
before Georgia ancillary receiver obtained injunction prohibiting filing or
prosecuting claims against the insurer. The plaintiff had no notice of the
ancillary proceeding, and the receiver had no notice of the suit and had denied
the claim. This case was later overturned by statute. See, Short v. State, 235
Ga. 394, 219 S.E.2d 728 (1975).
Wright v. Fuller, 148 Ga. 223, 96 S.E. 433 (1918). The court held that where
insurer had an obligation under a disability policy to pay $5,000 in $25.00
monthly installments, this obligation was fixed upon the date of the insolvency