Attorney-General v. North America Life Insurance

Andrews, J. By an order of the Special Term of April 24, 1877, liberty was given to Barnes & Hanover, to appear in behalf of Violetta A. Bedell, a policy-holder in the North America Insurance Company, and any person similarly situated, in all motions and proceedings in this action, and the order provided that notices of all motions and proceedings in this action in court on the part of the attorney-general or of the receiver of the corporation, be served upon said firm. Prior to the making of this order, and on the. 8th of March, 1877, a receiver of the company had been appointed upon the application of the attorney-general, pursuant to the provisions of chapter 902, of the Laws of 1869, and the company enjoined from the further prosecution of its .business. There was no appeal from the order of April 24. The receiver as the officer of the court, represented the policyholders and other creditors of the company. But it was competent for the court in the exercise of its equitable jurisdiction to permit parties interested in the administration of the property and assets of the corporation to appear and be made parties to proceedings taken by or against the receiver, by which their rights might be affected. It was in *300 the discretion of the court to allow the policy-holders who stood in the position of cestuis que trust, to appear and represent their own interests. There is in strictness no suit to which the policy-holders can be made parties. The proceeding for the appointment of a receiver under the act of 1869, is summary and special. The object of the order of April 24th, as is apparent upon its face was to give the policy-holders represented,by Barnes & Hanover, a standing in court, to enable them to appear and be heard upon applications made by the attorney-general, or the receiver, in resptect to the affairs of the 'company, and the right to appear, and thereby become parties to such proceedings, included the right to appeal from orders made affecting their interests. The order of the General Term dismissing the appeal of the policy-holders from the order confirming the actuary’s report, was erroneous. The order of confirmation was made upon the application of the receiver, for instructions upon the matters embraced in the report, which application was made on notice to Barnes & Hanover, as attorneys for policy-holders given pursuant to the order of April 24th. They appeared and filed exceptions to the report, and were heard before the Special Term on the application for the order for confirmation. The policy-holders in whose behalf the exceptions were filed, then appealed to the General Term, and their appeal was dismissed on the ground that they were not parties to the proceeding, and had no right to appeal. They were, we think, made parties by the notice served on them, pursuant to the order of April 24th, and their appearance in pursuance thereof, on the hearing at the Special Term, and were parties aggrieved, within the meaning of section 1294 of the Code. The order of the General Term is therefore reversed, and the case remitted to that court for hearing and decision on the merits. All concur. Order reversed.