§ 44-4821 — Powers of liquidator

Nebraska § 44-4821

• Jurisdiction: Nebraska
• Ch. 44: Insurance

Text

(1) The liquidator shall have the power:
(a) To appoint a special deputy to act for him or her under
the Nebraska Insurers Supervision, Rehabilitation, and Liquidation Act and
to determine his or her reasonable compensation. The special deputy shall
have all powers of the liquidator granted by this section. The special deputy
shall serve at the pleasure of the liquidator;
(b) To employ employees, agents, legal counsel, actuaries,
accountants, appraisers, consultants, and such other personnel as he or she
may deem necessary to assist in the liquidation;
(c) To appoint, with the approval of the court, an advisory
committee of policyholders, claimants, or other creditors, including guaranty
associations, should such a committee be deemed necessary. Such committee
shall serve without compensation other than reimbursement for reasonable travel
and per diem living expenses. No other committee of any nature shall be appointed
by the director or the court in liquidation proceedings conducted under the
act;
(d) To fix the reasonable compensation of employees, agents,
legal counsel, actuaries, accountants, appraisers, and consultants with the
approval of the court;
(e) To pay reasonable compensation to persons appointed and
to defray from the funds or assets of the insurer all expenses of taking possession
of, conserving, conducting, liquidating, disposing of, or otherwise dealing
with the business and property of the insurer;
(f) To hold hearings, to subpoena witnesses, to compel their
attendance, to administer oaths and affirmations, to examine any person under
oath or affirmation, and to compel any person to subscribe to his or her testimony
after it has been correctly reduced to writing and, in connection therewith,
to require the production of any books, papers, records, or other documents
which he or she deems relevant to the inquiry;
(g) To audit the books and records of all agents of the insurer
insofar as those records relate to the business activities of the insurer;
(h) To collect all debts and money due and claims belonging
to the insurer, wherever located, and for this purpose:
(i) To institute timely action in other jurisdictions, in
order to forestall garnishment and attachment proceedings against such debts;
(ii) To do such other acts as are necessary or expedient to
collect, conserve, or protect its assets or property, including the power
to sell, compound, compromise, or assign debts for purposes of collection
upon such terms and conditions as he or she deems best; and
(iii) To pursue any creditor's remedies available to enforce
his or her claims;
(i) To conduct public and private sales of the property of
the insurer;
(j) To use assets of the estate of an insurer under a liquidation
order to transfer policy obligations to a solvent assuming insurer if the
transfer can be arranged without prejudice to applicable priorities under
section 44-4842 ;
(k) To acquire, hypothecate, encumber, lease, improve, sell,
transfer, abandon, or otherwise dispose of or deal with any property of the
insurer at its market value or upon such terms and conditions as are fair
and reasonable. He or she shall also have power to execute, acknowledge, and
deliver any and all deeds, assignments, releases, and other instruments necessary
or proper to effectuate any sale of property or other transaction in connection
with the liquidation;
(l) To borrow money on the security of the insurer's assets
or without security and to execute and deliver all documents necessary to
that transaction for the purpose of facilitating the liquidation. Any such
funds borrowed may be repaid as an administrative expense and shall have priority
over any other claims under subdivision (1) of section 44-4842 ;
(m) To enter into such contracts as are necessary to carry
out the order to liquidate and to affirm or disavow any contracts to which
the insurer is a party, except
that a liquidator shall not have power to disavow, reject, or repudiate any
Federal Home Loan Bank security agreement, or any pledge, security, collateral
or guarantee agreement or any other similar arrangement or credit enhancement
relating to such Federal Home Loan Bank security agreement;
(n) To continue to prosecute and to institute in the name
of the insurer or in his or her own name any and all suits and other legal
proceedings in this state or elsewhere and to abandon the prosecution of claims
he or she deems unprofitable to pursue further. If the insurer is dissolved
under section 44-4820 , the liquidator shall have the power to apply to any
court in this state or elsewhere for leave to substitute himself or herself
for the insurer as plaintiff;
(o) To prosecute any action which may exist on behalf of the
insureds, creditors, members, or shareholders of the insurer against any officer
of the insurer or any other person;
(p) To remove any or all records and property of the insurer
to the offices of the director or to such other place as may be convenient
for the purposes of efficient and orderly execution of the liquidation. Guaranty
associations and foreign guaranty associations shall have such reasonable
access to the records of the insurer as is necessary for them to carry out
their statutory obligations;
(q) To deposit in one or more banks in this state such sums
as are required for meeting current administration expenses and dividend distributions;
(r) To invest all sums not currently needed unless the court
orders otherwise;
(s) To file any necessary documents for record in the office
of any register of deeds or record office in this state or elsewhere where
property of the insurer is located;
(t) To assert all defenses available to the insurer as against
third persons, including statutes of limitations, statutes of frauds, and
the defense of usury. A waiver of any defense by the insurer after a petition
in liquidation has been filed shall not bind the liquidator. Whenever a guaranty
association or foreign guaranty association has an obligation to defend any
suit, the liquidator shall give precedence to such obligation and may defend
only in the absence of a defense by such guaranty associations;
(u) To exercise and enforce all the rights, remedies, and
powers of any insured, creditor, shareholder, or member, including any power
to avoid any transfer or lien that may be given by the general law and that
is not included with sections 44-4826 to 44-4828 , except that a liquidator shall not have power to disavow,
reject, or repudiate any Federal Home Loan Bank security agreement, or any
pledge, security, collateral or guarantee agreement or any other similar arrangement
or credit enhancement relating to such Federal Home Loan Bank security agreement;
(v) To intervene in any proceeding wherever instituted that
might lead to the appointment of a receiver or trustee and to act as the receiver
or trustee whenever the appointment is offered;
(w) To enter into agreements with any receiver or the director,
commissioner, or equivalent official of any other state relating to the rehabilitation,
liquidation, conservation, or dissolution of an insurer doing business in
both states; and
(x) To exercise all powers now held or hereafter conferred
upon receivers by the laws of this state not inconsistent with the provisions
of the act.
(2)(a) If a company placed in liquidation has issued liability
policies on a claims-made basis, which policies provided an option to purchase
an extended period to report claims, then the liquidator may make available
to holders of such policies, for a charge, an extended period to report claims
as stated in this subsection. The extended reporting period shall be made
available only to those insureds who have not secured substitute coverage.
The extended period made available by the liquidator shall begin upon termination
of any extended period to report claims in the basic policy and shall end
at the earlier of the final date for filing of claims in the liquidation proceeding
or eighteen months from the order of liquidation.
(b) The extended period to report claims made available by
the liquidator shall be subject to the terms of the policy to which it relates.
The liquidator shall make available such extended period within sixty days
after the order of liquidation at a charge to be determined by the liquidator
subject to approval of the court. Such offer shall be deemed rejected unless
the offer is accepted in writing and the charge is paid within ninety days
after the order of liquidation. No commissions, premium taxes, assessments,
or other fees shall be due on the charge pertaining to the extended period
to report claims.
(3) The enumeration in this section of the powers and authority
of the liquidator shall not be construed as a limitation upon him or her nor
shall it exclude in any manner his or her right to do such other acts not
in this section specifically enumerated or otherwise provided for as may be
necessary or appropriate for the accomplishment of or in aid of the purpose
of liquidation.
(4) Notwithstanding the powers of the liquidator as stated
in subsections (1) and (2) of this section, the liquidator shall have no obligation
to defend claims or to continue to defend claims subsequent to the entry of
a liquidation order.

Legislative History

Source: Laws 1989, LB 319, § 21; Laws 1991, LB 236, § 75; Laws 2013, LB337, § 3. Annotations: The liquidator did not seek to enforce the arbitration agreements in question but disavowed them according to the express powers granted under subsection (1)(m) of this section. State ex rel. Wagner v. Kay, 15 Neb. App. 85, 722 N.W.2d 348 (2006).