Illinois Code § 179E-75

§ 179E-75.

Sec. 179E-75. Conservation, rehabilitation, or liquidation. (a) The provisions of Articles XIII and XIII 1/2 apply to an SPRV, except to the extent modified in this Section. (b) Notwithstanding the provisions of Section 188 of this Code, the Director may apply by petition to the Circuit Court of Cook County, the Circuit Court of Sangamon County, or the circuit court of the county in which an SPRV has or last had its principal office for an order authorizing the Director to conserve, rehabilitate or liquidate an SPRV domiciled in this State solely on one or more of the following grounds: (1) there has been embezzlement, wrongful sequestration, dissipation, or diversion of the assets of the SPRV intended to be used to pay amounts owed to the ceding insurer or the holders of SPRV securities; or (2) the SPRV is insolvent and the holders of a majority in outstanding principal amount of each class of SPRV securities request or consent to conservation, rehabilitation, or liquidation under this Article. The court shall not grant relief under item (1) of this subsection unless, after notice and a hearing, the Director, who has the burden of proof, establishes by clear and convincing evidence that the relief should be granted. (c) Notwithstanding any contrary provision in this Code, the rules promulgated under this Code, or any other applicable law or rule, upon any order of conservation, rehabilitation, or liquidation of the SPRV, the receiver shall be bound to deal with the SPRV's assets and liabilities, in accordance with the requirements set forth in this Article. (d) With respect to amounts recoverable under an SPRV contract, the amount recoverable by the receiver may not be reduced or diminished as a result of the entry of an order of conservation, rehabilitation, or liquidation with respect to the ceding insurer notwithstanding any provisions to the contrary in the contracts or other documentation governing the SPRV insurance securitization. (e) Notwithstanding the provisions of Article XIII and XIII 1/2 of this Code, any application, petition, or temporary restraining order or injunction issued under those Articles, with respect to a ceding insurer shall not prohibit the transaction of any business by an SPRV, including any payment by an SPRV made pursuant to an SPRV security, or any action or proceeding against an SPRV or its assets. (f) Notwithstanding the provisions of Articles XIII and XIII 1/2 of this Code, the commencement of a summary proceeding or other interim proceeding commenced before a formal delinquency proceeding with respect to an SPRV, and any order issued by the court thereunder, shall not prohibit: (1) the payment by an SPRV made pursuant to an SPRV security or SPRV contract; or (2) the SPRV from taking any action required to make the payment. (g) Notwithstanding any other provision of Articles XIII and XIII 1/2 of this Code or other State law: (1) a receiver of a ceding insurer may not avoid a non-fraudulent transfer by a ceding insurer to an SPRV of money or other property made pursuant to an SPRV contract; and (2) a receiver of an SPRV may not void a non-fraudulent transfer by the SPRV of money or other property made to a ceding insurer pursuant to an SPRV contract or made to or for the benefit of any holder of an SPRV security on account of the SPRV security. (h) With the exception of the fulfillment of the obligations under an SPRV contract, and notwithstanding any other provisions of this Article or other law of this State to the contrary, the assets of an SPRV, including assets held in trust, may not be consolidated with or included in the estate of a ceding insurer in any delinquency proceeding against the ceding insurer under this Article for any purpose, including, without limitation, distribution to creditors of the ceding insurer. (i) Notwithstanding any other provision of this Article: (1) A domiciliary receiver of an SPRV domiciled in another state shall be vested by operation of law with the title to all of the assets, property, contracts, and rights of action, and all of the books, accounts, and other records of the SPRV located in this State. The domiciliary receiver shall have the immediate right to recover all of the vested property, assets, and causes of action of the SPRV located in this State. (2) An ancillary proceeding may not be commenced or prosecuted in this State against an SPRV domiciled in another state. (Source: P.A. 92-124, eff. 7-20-01.)