Consumers United Insurance Company (Del.)
D.C. Judge Rules Against Receiver in
In October 2003, a District of Columbia Superior Court judge dismissed the case filed by the CUIC receiver against the District of Columbia over an undeveloped tract of real estate in Washington, D.C., known as "Parkside." The receiver charged the D.C. government with breach of contract for its failure to honor a "put" option on the property at the request of the CUIC estate. In the course of discovery, the receiver added fraud allegations to the complaint. The parties completed discovery in the spring of 2003 and filed motions for summary judgment during the summer.
At the summary judgment hearing, the judge ruled from the bench, citing Anti-Deficiency Act violations and public policy considerations as the basis for dismissing the case. The Anti-Deficiency Act is a federal law disallowing D.C. government agents to contract for or commit to expenditures for which funds have not been allocated. Although the judge read his opinion into the court transcript, no written opinion was issued.
The special deputy receiver handling the Parkside case has consulted with representatives of NOLHGA's CUIC Task Force and kept them apprised on a regular basis during the case. Currently, the special deputy receiver is considering options for appeal. The Parkside litigation is one of the primary matters left for resolution before estate closure.
Task Force Chair - Peggy Parker; Staff Contact - Executive Life Insurance Company (Calif.)PGAs Receive Additional FEC Litigation Trust Funds
In follow up to the FEC distributions of $27.7 million in November 2002 and $237,347.47 in August 2003, four participating guaranty associations (Illinois, New Jersey, Ohio, and Texas) received a share of $164,558.54 in FEC funds this week based upon subrogation rights to funds held for certain pension GICs whose contract holders were either fully or partially covered.
The FEC Litigation Trust was originally established in 1992 to receive the proceeds from pending claims and litigation belonging to ELIC's parent company, First Executive Corporation, at the time of its bankruptcy. The corpus of the trust was held for beneficiaries of the ELIC estate and has been substantially distributed.
Task Force Chair - Art Dummer; Staff Contact -Insurance Reform Considered by Congressional Subcommittee
On November 5, 2003, the House Financial Services Subcommittee on Capital Markets, chaired by Rep. Richard Baker (R-La.), held a hearing entitled, "Reforming Insurance Regulation--Making the Marketplace More Competitive for Consumers." Chairman Baker asked industry witnesses for their ideas on how existing initiatives from the National Conference of Insurance Legislators (NCOIL), National Conference of State Legislators (NCSL), and National Association of Insurance Commissioners (NAIC) might be fashioned into a legislative proposal and whether the goal of insurance uniformity could be met without creating a federal regulator. Industry comments are due to the subcommittee by mid-December.
Staff Contact -Work Begins on 2003 Year-End Report to the Membership
Preparations have begun for the publication of the NOLHGA 2003 Year-End Report to the Membership. NOLHGA staff will be working with task force chairs to update the insolvency reports, which are due in late December 2003. Guaranty association administrators with any information, updates, or suggestions regarding a particular insolvency should contact the task force's NOLHGA staff contact.
The Year-End Report to the Membership is typically published every March so that year-end financials can be included. If you have any questions about the Report, please contact Sean McKenna at [email protected] or 703.787.4106.
Staff Contact - Sean McKennaAnnual Meeting Presentations Available Online
A number of the speaker presentations from NOLHGA's 20th Annual Meeting in Dallas have been posted on the meeting Web page. Access to the presentations (which are in PDF format) is restricted, so users must log in once they reach the Web page to access the PDF files. Also, please note that some presentations will not be posted. If you have any problems accessing the presentations, please contact Sean McKenna at [email protected] or 703.787.4106.
Staff Contact - Sean McKenna