Matter of Rehabilitation of Financial Guaranty Ins.

NEW YORK COUNTY
Insurance Law

New York Law Journal

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Justice Doris Ling-Cohan

In this rehabilitation suit, brought under Insurance Law Article 74, a rehabilitator of Financial Guaranty Insurance was appointed without objection. The court found that no affirmations or affidavits were submitted raising any material issues of fact that required an evidentiary hearing as to the proposed plan. It further found that none of the objectors were able to articulate a material issue of fact on prior oral arguments, concluding an evidentiary hearing was unnecessary. The court also noted there were no objections to the appointment of the rehabilitator from any interested party, stating the objectors simply objected to the approval of the plan of rehabilitation, as proposed by the rehabilitator. Jefferson County Warrantholders argued §7403(d) was applicable and a full hearing was required. The court stated the plain language of §7403(d) specifically stated it applied only to terminations of rehabilitation suits. It noted while Jefferson also argued that given the consequences and amount of money at stake, it was entitled to an evidentiary hearing, such argument was misplaced as legislature did not provide for such a hearing based on the stakes or consequences.

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