Case ID: ad2d_171/html/0431-01.html
Source: Caselaw Access Project
Author: {"author": "", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

In the Matter of James P. Corcoran, as Superintendent of Insurance of the State of New York, Appellant. First New York Syndicate Corporation, Respondent.
   Order, Supreme Court, New York County (Irving Kirschenbaum, J.) entered December 29, 1988, which dismissed the petition, unanimously affirmed, without costs.

This is a special proceeding pursuant to article 74 of the Insurance Law to liquidate respondent on the ground of financial insolvency and/or impairment. Respondent admits insolvency. Respondent, as a member of the New York Insurance Exchange ("the Exchange”), was required, inter alia, to maintain a minimum policyholder surplus of $2.2 million (Insurance Law § 6203; 11 NYCRR 18-1.3; Exchange Constitution and Bylaws, art VII, § 6). After conferences with the court, an interim order was issued on May 17, 1988, which, inter alia, adjourned the return date of the petition to December 1988 and permitted respondent to execute certain commutation agreements which would restore it to a positive net worth position with a surplus of not less than $1,134,000, and be capable of continuing as an on-going company to do insurance and/or reinsurance business, which business would not be the self-liquidation of respondent. Petitioner did not consent to the interim order.

On December 19, 1988, in conference, respondent made an application for an order dismissing the petition on the ground that it had complied with the requirements of the interim order. Petitioner opposed on the ground that respondent could not satisfy the $2.2 million minimum surplus requirement of the Exchange. Respondent stated that it was withdrawing from the Exchange and will be doing a different kind of insurance business.

Although there is no doubt that the $2.2 million requirement is applicable to members of the Exchange, as respondent is withdrawing from the Exchange, such minimum is no longer required. As respondent had complied with the requirements of the interim order, the court properly dismissed the petition. Concur — Kupferman, J. P., Carro, Kassal, Ellerin and Smith, JJ.