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The Vermont Statutes Online



Title

08

:
Banking and Insurance






Chapter

145

:
SUPERVISION, REHABILITATION, AND LIQUIDATION OF INSURERS






Subchapter

003
:
FORMAL PROCEEDINGS










 

§

7054. Actions by and against rehabilitator

(a) A court in

this State before which an action or proceeding in which the insurer is a

party, or is obligated to defend a party, is pending when a rehabilitation

order against the insurer is entered shall stay the action or proceeding for 90

days and such additional time as is necessary for the rehabilitator to obtain

proper representation and prepare for further proceedings. The rehabilitator

shall take such action respecting the pending litigation as he or she deems

necessary in the interests of justice and for the protection of creditors,

policyholders, and the public. The rehabilitator shall immediately consider all

litigation pending outside this State and shall petition the courts having

jurisdiction over that litigation for stays whenever necessary to protect the

estate of the insurer.

(b) A statute of

limitations or defense of laches shall not run with respect to any action by or

against an insurer between the filing of a petition for appointment of a

rehabilitator for that insurer and the order granting or denying that petition.

An action by or against the insurer that might have been commenced when the

petition was filed may be commenced for at least 60 days after the order of

rehabilitation is entered or the petition is denied. The rehabilitator may,

upon an order for rehabilitation, within one year or such other longer time as

applicable law may permit, institute an action or proceeding on behalf of the

insurer upon any cause of action against which the period of limitation fixed

by applicable law has not expired at the time of the filing of the petition

upon which such order is entered. (Added 1991, No. 45, § 2, eff. May 29, 1991.)