O'Deane v. C & S Wholesale Grocers, Inc.

584 A.2d 423, 155 Vt. 651, 1990 Vt. LEXIS 244

Opinion

Following the appointment of the Massachusetts insurance commissioner as permanent receiver of defendant American Mutual, an insolvent Massachusetts insurance company, the company, pursuant to 8 V.S.A. § 3596, moved to dismiss the action brought against it by plaintiff. The court denied the motion.

Section 3596 states in relevant part: “[N]o action . . . against such insurer [in receivership in a reciprocal state], shall be . . . continued in the courts of this state . . . .” Under the circumstances of this case, the plain meaning of this statute does not give a Vermont court any discretion to deny a motion to dismiss when an insurer such as American Mutual is undergoing a proceeding for rehabilitation, reorganization or liquidation in a qualifying foreign jurisdiction.

Massachusetts is a “reciprocal state” insofar as relevant to this case if § 3596 is “in substance and effect... in force” in Massachusetts. 8 V.S.A. § 3591. We hold that Massachusetts Insurers Liquidation Law, 175 M.G.L. §§ 180A-L, is sufficiently similar to Vermont’s counterpart, 8 V.S.A. chapter 101, subchapter 8, in relevant respects to qualify Massachusetts as a “reciprocal state.” Section 180F of the Massachusetts law provides for the appointment of an ancillary receiver in Vermont to process Vermont claims in similar fashion as 8 V.S.A. § 3592 makes provision for appointment of a referee to process Massachusetts claims in Massachusetts.

Reversed.