Court Opinion

ID: 3624657
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:05:33.779036+00
Date Added: 2024-06-11T12:03:39.169125
License: Public Domain

The plaintiffs began their action against the Second Russian Insurance Company before the order was made authorizing the Superintendent of Insurance to take possession of the property of the insurance company and conserve its assets. Actions pending against the insurance company might doubtless be stayed for the purpose of preventing interference with the Superintendent of Insurance in the proper exercise of his duties under the order so that the purpose of such order might be effectuated. Discretion doubtless exists in the Supreme Court to refuse to modify a stay so granted where the effect of permitting the continuance of pending actions might perhaps have such result. In the present case there is no proof of insolvency on the part of the insurance company and it has not been placed in the hands of a receiver or had its property sequestrated in its domiciliary State or country or in any other State or country. In no forum here or elsewhere can the plaintiffs in these two actions prove their claim and secure satisfaction, if their claims are valid, except by action. So long as the Superintendent of Insurance holds these assets, the plaintiffs cannot share in them even when the classes of creditors described in section 27 have been paid. Until further direction or judgment of the court taken in some other proceeding or action, these assets in the hands of the Superintendent *Page 609 
of Insurance could not be reached or used for payment of any judgments which the plaintiffs might obtain if the stay were modified. So long as no forum exists for proof of claims except by action, I do not believe that the court has discretion to continue a stay which prevents proof of claim by the prosecution of the pending actions, so that at the appropriate time the plaintiffs, if they establish their claims, may take proceedings to secure payment out of assets still remaining in the hands of the Superintendent of Insurance. Equality between creditors is not equity unless the debtor is insolvent and its assets are made applicable to the payment of the claims of creditors according to the priority fixed by law.
The orders should be reversed and motion granted.
CARDOZO, Ch. J., POUND, CRANE, ANDREWS and O'BRIEN, JJ., concur; LEHMAN, J., dissents in opinion, in which KELLOGG, J., concurs.
Appeal dismissed.