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Maroney O’Connor LLP 11 BROADWAY
‘SUITE 831
NEW YORK, NEWYORK 10004
pbutler@maroneyoconnorlip.com
212.509.2009 (x110)
FAX: 212.504.2754
May 10, 2017
VIA NYSCEF
Salvatore J. Sciangula, Esq.
138 Compass Place
Arverne, New York 11692
Re: Kimberly D. Suarez v. Jose J. Leon
Index No.: 156120/2016
Dear Counselors:
Please be advised that pursuant to the attached Order to Show Cause, signed by the
Honorable Leslie J. Purificacion, this matter has been stayed pending the return date
of May 2, 2017, as the State of New York seeks the liquidation of Fiduciary Insurance
Company of America. Please note that at the Court appearance on May 2, 2017, the
Order to Show Cause was adjourned to June 7, 2017.
Please further note that we will advise as soon as the stay has either been lifted or
extended based upon Court action.
Should you have any questions, please do not hesitate to contact me.
Your cooperation in this matter is greatly appreciated.
Very trulyyours,
Patrick M. Butler, Esq.
Our File No.: 20167910
cc:
VIA NYSCEF
Supreme Court, New York County
Attn: County Clerk
60 Centre Street
New York, New York 10007A- At IAS Pato of the Supreme
Court of the State of New York,
County of Queens, at the acer
“ye located at 8&-H-Sutphin-Botlevar
were oot the ew York, onthe "2 -
Ll
PRESENT: Gebers Ke
iy
HON. s ESIC, \ (t ° \
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF QUEENS
oan 3904
In the Matter of Index No. O
the Application of * ORDER TO SHOW CAUSE
Maria T. Vullo, Superintendent of Financial
Services of the State of New York, for an order to take
possession and liquidate the business and affairs of
FIDUCIARY INSURANCE COMPANY OF AMERICA.
eee
Based on the verified petition (“Verified Petition”) of Maria T. Vullo, Superintendent of
Financial Services of the State of New York (“Superintendent”), duly verified on February 24,
2017, the supporting Affidavit of Mare Allen, dated February 16, 2017, and the exhibits and
schedules attached thereto, and it appearing that the relief sought should be granted;
NOW, on motion of Eric T. Schneiderman, Attomey General of the State of New York,
attorney for the Superintendent, and after due deliberation having been had thereon;
LET Fiduciary Insurance Company of America (“Fiduciary”) show cause before this
Court at Ore a Beccol at the Courthouse located at 88-11 Sutphin Boulevard,
Jamaica, New York in the County of Queens, State of New York, on the, day of
Y pe2017, al o'clock pm, or as soon thereafter as counsel can be heard (“Return Date”), why
an order in the form of Exhibit 1 to the Verified Petition should not be made, pursuant to Article
74 of the New York Insurance Law (“Insurance Law”), inter alia: (1) appointing the
Superintendent, and her successors in office, as liquidator of Fiduciary (the “Liquidator”); (2)
directing the Liquidator to take possession of Fiduciary’s property and to liquidate Fiduciary’s
business and affairs; (3) vesting title to all of Fiduciary’s property, contracts, and rights of action
and all of its books and records, wherever located, in the Liquidator and her successors; (4)
permitting the Liquidator to deal with the property and business of Fiduciary in Fiduciary’s name
or in the name of the Liquidator; (5) granting the injunctions provided for in Insurance Law
§7419(a), permanently enjoining and restraining all persons, except as authorized by the
Liquidator, from transacting Fiduciary’s business (including the issuance of insurance policies)
or the waste or disposition of Fiduciary’s property; (6) granting the injunctions provided for in
Insurance Law § 7419(b), permanently enjoining and restraining all parties from interfering with
the Liquidator or this proceeding, or wasting assets of Fiduciary or obtaining any preferences,
judgments, attachments or other liens, or making any levy against Fiduciary, its assets or any part
thereof, and commencing or prosecuting any actions or proceedings against the Superintendent
as Liquidator of Fiduciary, the New York Liquidation Bureau, or their present or former
employees, attorneys or agents, relating to this proceeding or the discharge of their duties under
Insurance Law Articles 74 and 76 in relation thereto; (7) enjoining and restraining all parties to
actions, lawsuits, and special or other proceedings in which Fiduciary’s policyholders or insureds
are a party or are obligated to defend a party pursuant to an insurance policy, bond, contract or
otherwise, from proceeding with any discovery, court proceedings or other litigation tasks or
procedures, including, but not limited to, conferences, trials, applications for judgment orproceedings on settlement or judgment, for a period of 180 days from the date of emry of an
order of liquidation; (8) enjoining and restraining all persons who have first party policyholder
loss claims, from presenting and filing claims with the Liquidator or with the Administrator for a
period of 90 days from the date of entry of an order of liquidation; (9) vesting all rights in
Fiduciary’s contracts and agreements, however described, with the Liquidator and permitting the
Liquidator, in her discretion, to reject any executory contracts to which Fiduciary is a party, in
which case all liability under such contracts or agreements shall cease and be fixed as of the date
of rejection; (10) requiring that any bank, savings and loan association, other financial institution
or any other entity or person, that has on deposit or in its possession, custody or control any of
Fiduciary’s funds, accounts (including escrow accounts) or assets shal} immediately, upon the
Liquidator’s request and direction: (a) turn over custody and control of such funds, accounts or
assets to the Liquidator; (b) transfer title of such funds, accounts or assets to the Liquidator; (©)
change the name of such accounts to the name of the Liquidator; (d) transfer funds from such
bank, savings and loan association or other financial institution; and (e) take any other action
reasonably necessary for the proper conduct of the liquidation. proceeding: (11) requiring that all
persons or entities having property, papers (including attorney work product and documents held
by attorneys) and/or information, including, but not limited to, insurance policies, underwriting
data, reinsurance policies, claims files (electronic or paper), software programs and/or bank
records owned by, belonging to or relating to Fiduciary shall preserve such property and/or
information and immediately, upon the Liquidator’s request and direction, assign, transfer, turn
over and deliver such property and/or information to the Liquidator; (12) authorizing, permitting
and allowing the Liquidator to sell, assign or transfer any and all stocks, bonds, or other
securities at the best price reasonably obtainable at such times and upon such terms andconditions as, in her discretion, she deems to be in the best interest of the creditors of Fiduciary,
and further authorizing the Liquidator to take such steps and to make and execute such
agreements and other papers as may be necessary to effect and carry out such sales, transfers and
assignments, without the further approval of this Court; (13) cancelling all existing insurance
policies of Fiduciary at 12:01 A.M. local time on the date that is 60 days from the entry of an
order of liquidation of Fiduciary (the “Cancellation Date”); (14) providing that all claims against
Fiduciary, including all evidence to establish the existence of an actual loss under a policy, must
be presented to the Liquidator by the date that is one year after the Cancellation Date (the “Bar
Date”), except that the Bar Date shall not apply to the Liquidator’s claims for administrative
expenses or to claims for reimbursement submitted by the New York Property/Casualty
Insurance Security Fund and the New York Public Motor Vehicle Liability Security Fund; (15)
authorizing the Liquidator, in her discretion, to refrain from adjudicating some or all claims
falling into Classes three through nine (Insurance Law § 7434(a)(1)(iii)-(ix)) unless and until she
reasonably believes that adjudication of such claims would be in the best interests of the estate;
(16) extending immunity to the Superintendent in her capacity as Liquidator of Fiduciary, her
successors in office, the New York Liquidation Bureau and their agents and employees, for any
cause of action of any nature against them, individually or jointly, for any act or omission when
acting in good faith, in accordance with the orders of this Court, or in the performance of their
duties pursuant to Insurance Law Article 74; (17) declaring Fiduciary insolvent within the
meaning of Insurance Law § 1309(a); and (18) granting such other and further relief as the Court
may deem proper and just.
AND, sufficient cause having been shown therefor, pursuant to Insurance Law §
7418(a)(1), let service of a copy of this order to show cause and the papers upon which it isgry peccwrch Aol (
gafited be made: (i) by ail upon John J. Hession, Ex utive Vice President and
————
General Counsel, Fiduciary Insurance Company ear As" Davis Street, 3° Floor, Long
Island City, New York 11101; (ii) hy first-class mail upon the 69 policyholders holding
—
Fiduciary mien that remain in force as of March 1, 2017; ;' (iii) by publishing a notice thereof,
iene ni ce
substantially in mn the form attached as Exhibit 3 to the Verified Petition (“Notice”), in the New
York Post not less than 30 days after the issuance of the order to show cause; and (iv) by posting
ae
on the internet web page 0 maintained by the New York Liquidation Bureau at
capt LE TEL NEE INH, 8 AST SS TE ARCA OI
and let such service be made at least 15, days pri rior to the Returp,Date, and
nel
such service shall be deemed good and sufficient service; and it is hereby
. ae A Reece ea
carrier at the following addresses:
Officy'of the Attorney General
12@ Broadway
‘Néw York, NY 10271
Attention: Rosalie
New York, Ney’ York 10038
Attention: Ggheral Counsel
Answering Papeps shall be submitted to this Cgofrt at IAS Part __at the Courthouse located
it 88-11 Sutphin Boulevard, Jamaica, New Yor} on or before the Return Date; and it is further
' The names and addresses of these policyholders are being withheld from this order to show cause in order to
maintain their privacy, but cach policyholder will be served with a copy of this order to show cause and its
supporting papers at their last-known address as shown on Fiduciary’s books and records. Fiduciary had 5,476
policies which expired, by their own terms, on or before March 1, 2017.ORDERED, that pursuant to Insurance Law § 7419, which provides that injunctions may
be issued, without notice, pending the determination of this application, Fiduciary, its officers,
DF directors, shareholders, members, trustees, agents, servants, employees, policyholders, attomeys,
and managers, and all other persons, are hereby restrained, except as authorized by the
i Superintendent, from transacting Fiduciary’s business (including the issuance of new insurance
policies) or disposing of Fiduciary's property, and all persons are restrained from wasting any of
Fiduciary’s property; and it is further
& of tt ORDERED, that pursuant to Insurance Law § 7419 pending the determination of this
(> ‘ motion, all actions or proceedings against Fiduciary and all actions or proceedings in which
Fiduciary is obligated to defend a party are stayed; and it is further
i ORDERED, that pending the determination of this motion, all persons are restrained from
« obtaining preferences, judgments, attachments or other liens, or making any levy or commencing
or prosecuting any actions or proceedings against Fiduciary or its assets.
ENTER
ILS.C,
Preview
Maroney O’Connor LLP 11 BROADWAY ‘SUITE 831 NEW YORK, NEWYORK 10004 pbutler@maroneyoconnorlip.com 212.509.2009 (x110) FAX: 212.504.2754 May 10, 2017 VIA NYSCEF Salvatore J. Sciangula, Esq. 138 Compass Place Arverne, New York 11692 Re: Kimberly D. Suarez v. Jose J. Leon Index No.: 156120/2016 Dear Counselors: Please be advised that pursuant to the attached Order to Show Cause, signed by the Honorable Leslie J. Purificacion, this matter has been stayed pending the return date of May 2, 2017, as the State of New York seeks the liquidation of Fiduciary Insurance Company of America. Please note that at the Court appearance on May 2, 2017, the Order to Show Cause was adjourned to June 7, 2017. Please further note that we will advise as soon as the stay has either been lifted or extended based upon Court action. Should you have any questions, please do not hesitate to contact me. Your cooperation in this matter is greatly appreciated. Very trulyyours, Patrick M. Butler, Esq. Our File No.: 20167910 cc: VIA NYSCEF Supreme Court, New York County Attn: County Clerk 60 Centre Street New York, New York 10007A- At IAS Pato of the Supreme Court of the State of New York, County of Queens, at the acer “ye located at 8&-H-Sutphin-Botlevar were oot the ew York, onthe "2 - Ll PRESENT: Gebers Ke iy HON. s ESIC, \ (t ° \ SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF QUEENS oan 3904 In the Matter of Index No. O the Application of * ORDER TO SHOW CAUSE Maria T. Vullo, Superintendent of Financial Services of the State of New York, for an order to take possession and liquidate the business and affairs of FIDUCIARY INSURANCE COMPANY OF AMERICA. eee Based on the verified petition (“Verified Petition”) of Maria T. Vullo, Superintendent of Financial Services of the State of New York (“Superintendent”), duly verified on February 24, 2017, the supporting Affidavit of Mare Allen, dated February 16, 2017, and the exhibits and schedules attached thereto, and it appearing that the relief sought should be granted; NOW, on motion of Eric T. Schneiderman, Attomey General of the State of New York, attorney for the Superintendent, and after due deliberation having been had thereon; LET Fiduciary Insurance Company of America (“Fiduciary”) show cause before this Court at Ore a Beccol at the Courthouse located at 88-11 Sutphin Boulevard, Jamaica, New York in the County of Queens, State of New York, on the, day of Y pe2017, al o'clock pm, or as soon thereafter as counsel can be heard (“Return Date”), why an order in the form of Exhibit 1 to the Verified Petition should not be made, pursuant to Article 74 of the New York Insurance Law (“Insurance Law”), inter alia: (1) appointing the Superintendent, and her successors in office, as liquidator of Fiduciary (the “Liquidator”); (2) directing the Liquidator to take possession of Fiduciary’s property and to liquidate Fiduciary’s business and affairs; (3) vesting title to all of Fiduciary’s property, contracts, and rights of action and all of its books and records, wherever located, in the Liquidator and her successors; (4) permitting the Liquidator to deal with the property and business of Fiduciary in Fiduciary’s name or in the name of the Liquidator; (5) granting the injunctions provided for in Insurance Law §7419(a), permanently enjoining and restraining all persons, except as authorized by the Liquidator, from transacting Fiduciary’s business (including the issuance of insurance policies) or the waste or disposition of Fiduciary’s property; (6) granting the injunctions provided for in Insurance Law § 7419(b), permanently enjoining and restraining all parties from interfering with the Liquidator or this proceeding, or wasting assets of Fiduciary or obtaining any preferences, judgments, attachments or other liens, or making any levy against Fiduciary, its assets or any part thereof, and commencing or prosecuting any actions or proceedings against the Superintendent as Liquidator of Fiduciary, the New York Liquidation Bureau, or their present or former employees, attorneys or agents, relating to this proceeding or the discharge of their duties under Insurance Law Articles 74 and 76 in relation thereto; (7) enjoining and restraining all parties to actions, lawsuits, and special or other proceedings in which Fiduciary’s policyholders or insureds are a party or are obligated to defend a party pursuant to an insurance policy, bond, contract or otherwise, from proceeding with any discovery, court proceedings or other litigation tasks or procedures, including, but not limited to, conferences, trials, applications for judgment orproceedings on settlement or judgment, for a period of 180 days from the date of emry of an order of liquidation; (8) enjoining and restraining all persons who have first party policyholder loss claims, from presenting and filing claims with the Liquidator or with the Administrator for a period of 90 days from the date of entry of an order of liquidation; (9) vesting all rights in Fiduciary’s contracts and agreements, however described, with the Liquidator and permitting the Liquidator, in her discretion, to reject any executory contracts to which Fiduciary is a party, in which case all liability under such contracts or agreements shall cease and be fixed as of the date of rejection; (10) requiring that any bank, savings and loan association, other financial institution or any other entity or person, that has on deposit or in its possession, custody or control any of Fiduciary’s funds, accounts (including escrow accounts) or assets shal} immediately, upon the Liquidator’s request and direction: (a) turn over custody and control of such funds, accounts or assets to the Liquidator; (b) transfer title of such funds, accounts or assets to the Liquidator; (©) change the name of such accounts to the name of the Liquidator; (d) transfer funds from such bank, savings and loan association or other financial institution; and (e) take any other action reasonably necessary for the proper conduct of the liquidation. proceeding: (11) requiring that all persons or entities having property, papers (including attorney work product and documents held by attorneys) and/or information, including, but not limited to, insurance policies, underwriting data, reinsurance policies, claims files (electronic or paper), software programs and/or bank records owned by, belonging to or relating to Fiduciary shall preserve such property and/or information and immediately, upon the Liquidator’s request and direction, assign, transfer, turn over and deliver such property and/or information to the Liquidator; (12) authorizing, permitting and allowing the Liquidator to sell, assign or transfer any and all stocks, bonds, or other securities at the best price reasonably obtainable at such times and upon such terms andconditions as, in her discretion, she deems to be in the best interest of the creditors of Fiduciary, and further authorizing the Liquidator to take such steps and to make and execute such agreements and other papers as may be necessary to effect and carry out such sales, transfers and assignments, without the further approval of this Court; (13) cancelling all existing insurance policies of Fiduciary at 12:01 A.M. local time on the date that is 60 days from the entry of an order of liquidation of Fiduciary (the “Cancellation Date”); (14) providing that all claims against Fiduciary, including all evidence to establish the existence of an actual loss under a policy, must be presented to the Liquidator by the date that is one year after the Cancellation Date (the “Bar Date”), except that the Bar Date shall not apply to the Liquidator’s claims for administrative expenses or to claims for reimbursement submitted by the New York Property/Casualty Insurance Security Fund and the New York Public Motor Vehicle Liability Security Fund; (15) authorizing the Liquidator, in her discretion, to refrain from adjudicating some or all claims falling into Classes three through nine (Insurance Law § 7434(a)(1)(iii)-(ix)) unless and until she reasonably believes that adjudication of such claims would be in the best interests of the estate; (16) extending immunity to the Superintendent in her capacity as Liquidator of Fiduciary, her successors in office, the New York Liquidation Bureau and their agents and employees, for any cause of action of any nature against them, individually or jointly, for any act or omission when acting in good faith, in accordance with the orders of this Court, or in the performance of their duties pursuant to Insurance Law Article 74; (17) declaring Fiduciary insolvent within the meaning of Insurance Law § 1309(a); and (18) granting such other and further relief as the Court may deem proper and just. AND, sufficient cause having been shown therefor, pursuant to Insurance Law § 7418(a)(1), let service of a copy of this order to show cause and the papers upon which it isgry peccwrch Aol ( gafited be made: (i) by ail upon John J. Hession, Ex utive Vice President and ———— General Counsel, Fiduciary Insurance Company ear As" Davis Street, 3° Floor, Long Island City, New York 11101; (ii) hy first-class mail upon the 69 policyholders holding — Fiduciary mien that remain in force as of March 1, 2017; ;' (iii) by publishing a notice thereof, iene ni ce substantially in mn the form attached as Exhibit 3 to the Verified Petition (“Notice”), in the New York Post not less than 30 days after the issuance of the order to show cause; and (iv) by posting ae on the internet web page 0 maintained by the New York Liquidation Bureau at capt LE TEL NEE INH, 8 AST SS TE ARCA OI and let such service be made at least 15, days pri rior to the Returp,Date, and nel such service shall be deemed good and sufficient service; and it is hereby . ae A Reece ea carrier at the following addresses: Officy'of the Attorney General 12@ Broadway ‘Néw York, NY 10271 Attention: Rosalie New York, Ney’ York 10038 Attention: Ggheral Counsel Answering Papeps shall be submitted to this Cgofrt at IAS Part __at the Courthouse located it 88-11 Sutphin Boulevard, Jamaica, New Yor} on or before the Return Date; and it is further ' The names and addresses of these policyholders are being withheld from this order to show cause in order to maintain their privacy, but cach policyholder will be served with a copy of this order to show cause and its supporting papers at their last-known address as shown on Fiduciary’s books and records. Fiduciary had 5,476 policies which expired, by their own terms, on or before March 1, 2017.ORDERED, that pursuant to Insurance Law § 7419, which provides that injunctions may be issued, without notice, pending the determination of this application, Fiduciary, its officers, DF directors, shareholders, members, trustees, agents, servants, employees, policyholders, attomeys, and managers, and all other persons, are hereby restrained, except as authorized by the i Superintendent, from transacting Fiduciary’s business (including the issuance of new insurance policies) or disposing of Fiduciary's property, and all persons are restrained from wasting any of Fiduciary’s property; and it is further & of tt ORDERED, that pursuant to Insurance Law § 7419 pending the determination of this (> ‘ motion, all actions or proceedings against Fiduciary and all actions or proceedings in which Fiduciary is obligated to defend a party are stayed; and it is further i ORDERED, that pending the determination of this motion, all persons are restrained from « obtaining preferences, judgments, attachments or other liens, or making any levy or commencing or prosecuting any actions or proceedings against Fiduciary or its assets. ENTER ILS.C,