32-46 Asbestos-Related Liability of Successor
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<![CDATA[CHAPTER 32-46ASBESTOS-RELATED LIABILITY OF SUCCESSOR32-46-01. Definitions. As used in this chapter:1."Asbestos claim" means a claim, wherever or whenever made, for damages, losses,<br>indemnification, contribution, or other relief arising out of, based on, or in any way<br>related to asbestos, including:a.The health effects of exposure to asbestos, including a claim for personal injury<br>or death, mental or emotional injury, risk of disease or other injury, or the costs<br>of medical monitoring or surveillance;b.A claim made by or on behalf of a person exposed to asbestos, or a<br>representative, spouse, parent, child, or other relative of the person; andc.A claim for damage or loss caused by the installation, presence, or removal of<br>asbestos.2."Corporation" means a corporation for profit, including a domestic corporation<br>organized under the laws of this state or a foreign corporation organized under laws<br>other than the laws of this state.3."Innocent successor" means a corporation that assumes or incurs or has assumed<br>or incurred successor asbestos-related liabilities that is a successor and became a<br>successor before January 1, 1972, or is any of that successor corporation's<br>successors.4."Successor asbestos-related liabilities" means a liability, whether known or<br>unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued,<br>liquidated or unliquidated, or due or to become due, which is related to asbestos<br>claims and were assumed or incurred by a corporation as a result of or in connection<br>with a merger or consolidation, or the plan of merger or consolidation related to the<br>merger or consolidation with or into another corporation, or that is related in any way<br>to asbestos claims based on the exercise of control or the ownership of stock of the<br>corporation before the merger or consolidation. The term includes liabilities that,<br>after the time of the merger or consolidation for which the fair market value of total<br>gross assets is determined under section 32-46-04, were or are paid or otherwise<br>discharged, or committed to be paid or otherwise discharged, by or on behalf of the<br>corporation, or by a successor of the corporation, or by or on behalf of a transferor,<br>in connection with settlements, judgments, or other discharges in this state or<br>another jurisdiction.5."Transferor" means a corporation from which successor asbestos-related liabilities<br>are or were assumed or incurred.32-46-02. Applicability.1.The limitations in section 32-46-03 apply to an innocent successor corporation.2.The limitations of section 32-46-03 do not apply to:a.Workers' compensation benefits paid by or on behalf of an employer to an<br>employee under the provisions of title 65, or a comparable workers'<br>compensation law of another jurisdiction;b.A claim against a corporation that does not constitute a successor<br>asbestos-related liability; orPage No. 1c.An obligation under the National Labor Relations Act [29 U.S.C. 151 et seq.], or<br>under a collective bargaining agreement.32-46-03. Measure of liabilities.1.Except as further limited in subsection 2, the cumulative successor asbestos-related<br>liabilities of an innocent successor corporation are limited to the fair market value of<br>the total gross assets of the transferor determined as of the time of the merger or<br>consolidation. The innocent successor corporation does not have responsibility for<br>successor asbestos-related liabilities in excess of this limitation.2.If the transferor had assumed or incurred successor asbestos-related liabilities or<br>liabilities in connection with a prior merger or consolidation with a prior transferor,<br>then the fair market value of the total assets of the prior transferor determined as of<br>the time of the earlier merger or consolidation must be substituted for the limitation<br>set forth in subsection 1 for purposes of determining the limitation of liability of an<br>innocent successor corporation.32-46-04. Establishing fair market value of total gross assets.1.An innocent successor corporation may establish the fair market value of total gross<br>assets for the purpose of the limitations under section 32-46-03 through any method<br>reasonable under the circumstances, including:a.By reference to the going concern value of the assets or to the purchase price<br>attributable to or paid for the assets in an arm's-length transaction; orb.In the absence of other readily available information from which the fair market<br>value may be determined, by reference to the value of the assets recorded on a<br>balance sheet.2.Total gross assets include intangible assets.3.To the extent total gross assets include liability insurance that was issued to the<br>transferor whose assets are being valued for purposes of this section, the<br>applicability, terms, conditions, and limits of the insurance are not affected by this<br>chapter, nor does this chapter otherwise affect the rights and obligations of an<br>insurer, transferor, or successor under an insurance contract or any related<br>agreements,includingpreenactmentsettlementsresolvingcoverage-relateddisputes, and the rights of an insurer to seek payment for applicable deductibles,<br>retrospective premiums, or self-insured retentions or to seek contribution from a<br>successor for uninsured or self-insured periods or periods when insurance is<br>uncollectible or otherwise unavailable. Without limiting the foregoing, to the extent<br>total gross assets include any such liability insurance, a settlement of a dispute<br>concerning the liability insurance coverage entered into by a transferor or successor<br>with the insurers of the transferor before August 1, 2009, are determinative of the<br>total coverage of the liability insurance to be included in the calculation of the<br>transferor's total gross assets.32-46-05. Adjustment.1.Except as provided in subsections 2 through 4, the fair market value of total gross<br>assets at the time of the merger or consolidation increases annually at a rate equal<br>to the sum of:a.The prime rate as listed in the first edition of the Wall Street Journal published<br>for each calendar year since the merger or consolidation, unless the prime rate<br>is not published in that edition of the Wall Street Journal, in which case anyPage No. 2reasonable determination of the prime rate on the first day of the year may be<br>used; andb.One percent.2.The rate found in subsection 1 may not be compounded.3.The adjustment of the fair market value of total gross assets continues as provided<br>in subsection 1 until the date the adjusted value is first exceeded by the cumulative<br>amounts of successor asbestos-related liabilities paid or committed to be paid by or<br>on behalf of the innocent successor corporation or a predecessor or by or on behalf<br>of a transferor after the time of the merger or consolidation for which the fair market<br>value of total gross assets is determined.4.An adjustment of the fair market value of total gross assets may not be applied to<br>any liability insurance that may be included in the definition of total gross assets by<br>subsection 3 of section 32-46-04.32-46-06. Scope of chapter. This chapter applies to all asbestos claims filed against aninnocent successor on or after August 1, 2009.This chapter also applies to any pendingasbestos claims against an innocent successor in which trial has not commenced as of the<br>effective date, except that any provisions of these sections which would be unconstitutional if<br>applied retroactively must be applied prospectively.Page No. 3Document Outlinechapter 32-46 asbestos-related liability of successor]]>