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without the insured’s consent. The Minnesota Court of Appeals held that MIGA
had authority under Minnesota Guaranty Association Act to settle and seek
reimbursement of the employee’s claim without the insured’s consent.
Illinois
Gines v. Ivy, 358 Ill. App. 3d 6007, 832 N.E.2d 937 (2005). Passenger in singleautomobile
accident sued driver. After driver’s automobile liability insurer
became insolvent and insurer‐provided attorneys were permitted to withdraw,
the circuit court entered a default judgment against driver. Subsequently, the
Insurance Guaranty Fund appointed driver’s former attorneys to represent
driver again and driver then successfully moved to vacate the default judgment.
Passenger appealed. The court found that the default judgment was either
barred by 215 Ill. Comp. Stat. 5/551’s 120‐day stay or required to be set aside by
215 Ill Comp. Stat. 5/537.7(b)’s 12‐month rule. Additionally, the court found the
Fund had standing under the express language of 215 Ill Comp. Stat. 5.537.7(b)
to move to vacate the default judgment on driver’s behalf.
IPF Recovery Co. v. Illinois Ins. Guar. Fund, 356 Ill. App. 3d 658, 826 N.E.2d 943
(2005). Where policy or contact of insurance does not contain a limitations
period regarding the time in which an insured may bring suit neither the tolling
provision of 215 Ill. Comp. Stat. 5/143.1, which tolls such periods from the date of
proof of loss until the date the claim is denied in whole or in part, nor the policy
behind it apply to the policy or contract.
Thomas v. Centeon Bio‐Services, Inc., 2003 WL 827408 (N.D. Ill. Mar. 3, 2003).
Based on the rule in Kotecki v. Cyclops Welding Corp., 136 Ill.2d 155 (1992), an
employer’s liability in a third‐party contribution claim is limited to the amount it
pays out in workers’ compensation benefits. Accordingly, where employer’s
insurer is insolvent and the Insurance Guaranty Fund has assumed its
obligations, a payment from employer to tortfeasor, who is covered by an
existing policy, is not in effect a payment from the Fund to a solvent insurer in
violation of 215 Ill. Comp. Stat. 5/534‐3(b)(v).
People ex rel. Shapo v. Agora Syndicate, Inc., 323 Ill. App. 3d 543, 752 N.E.2d 1186
(2001). Director of Insurance brought liquidation action against insurance
syndicate. Based on custodial accounts held in compliance with 215 Ill. Comp.
Stat. 5/107.27 and 107.26(b), syndicate was insolvent on a cash flow basis.
Syndicate argued that adherence to the sections’ requirements precluding a
finding of insolvency. Because funds in custodial accounts that were not readily
accessible to syndicate, syndicate was insolvent. Where Director finds that
insurer is insolvent, the Director has the discretion under the express language
of § 192(4) to request an order of liquidation, rather than seek rehabilitation.