40-3639. Same; denial of claims; objections to denial; claims secured by the undertaking of another, rights to prove and file.
40-3639
40-3639. Same; denial of claims; objections to denial; claims secured bythe undertaking of another, rights to prove and file.(a) When a claim is denied in whole or in part by theliquidator,written notice of the determination shall be given to the claimant or theclaimant's attorneyby first-class mail at the address shown in the proof of claim. Within 60 daysfrom the mailing of the notice, the claimant may file objections with theliquidator. If no such filing is made, the claimant may not further object tothe determination.
(b) Whenever objections are filed with the liquidator and the liquidatordoes not alter denial of the claim as a result of the objections, theliquidator shall ask the court for a hearing as soon as practicable and givenotice as set by the court of the hearing to the claimant or the claimant'sattorney and toany other persons directly affected. The matter may be heard by the court or bya court-appointed referee who shall submit findings of fact along withrecommendation.
(c) Whenever a creditor whose claim against an insurer is secured, in wholeor in part, by the undertaking of another person, fails to prove and file thatclaim the other person may do so in the creditor's name, and shall besubrogated to the rights of the creditor, whether the claim has been filed bythe creditor or by the person in the creditor's name, to the extent that theperson discharges the undertaking. In the absence of an agreement with thecreditor to the contrary, the other person shall not be entitled to anydistribution; however, until the amount paid to the credit on the undertakingplus the distributions paid on the claim from the insurer's estate to thecreditor equals the amount of the entire claim of the creditor. Any excessreceived by the creditor shall be held by such creditor in trust for such otherperson, the term"other person," as used in this section is not intended to apply to a guarantyassociation or foreign guaranty association.
History: L. 1991, ch. 125, § 35; July 1.