Plaintiff, Carol Kostick, commenced this action on September 10, 1982, seeking to recover damages for personal injuries suffered as the result of an auto accident which occurred on December 15, 1981. She was a passenger in a car driven by her husband which was struck by a vehicle driven by defendant Wesley K. Janke, Jr. Plaintiff commenced this action against her husband, John P. Kostick, his employer, J.C. & Associates, and Janke.
By order dated October 27, 1983, Selected Risks Insurance Company deposited $15,000, the full policy limits, into court on behalf of defendant Janke. Transit Casualty Insurance Company (Transit) by order dated September 7, 1984, deposited its full policy limits of $100,000 into court on behalf of defendants Kostick and J.C. & Associates.
On September 17, 1984, defendant John Kostick commenced an action for declaratory judgment against his excess insurance carriers, State Farm Mutual Automobile Insurance Company and Allstate Insurance Company, seeking to enforce excess liability coverage. The Law Division granted summary judgment to the excess carriers denying coverage on August 1, 1986. The Appellate Division unanimously affirmed the trial court on March 17, 1987. On March 30, 1987, plaintiff executed a general release which was forwarded together with a stipulation of dismissal to defendants Kostick, Janke and J.C. & Associates.
Transit is a Missouri based multi-state insurance carrier. On December 3, 1985, subsequent to the deposit of the insurance proceeds with the court and the final determination by the Appellate Division, an amended order of liquidation and the appointment of a receiver was entered by the Circuit Court of Cole County, State of Missouri, declaring Transit insolvent and appointing Lewis R. Crist as receiver.
Plaintiff has filed a motion to withdraw all funds on deposit with the court and the receiver has filed a motion and cross-motion to intervene and to withdraw the funds on behalf of the insolvent estate. The New Jersey Property-Liability Insurance Guaranty Association has filed a motion to intervene and in support of plaintiff's motion for withdrawal of the funds. Both motions for intervention are granted. The withdrawal of the $15,000 on deposit is not contested, therefore, the only issue remaining is whether plaintiff should be permitted to withdraw the $100,000 previously deposited into court by Transit, which funds were deposited some 15 months prior to Transit's being declared insolvent. The threshold question is whether funds, once deposited into court pursuant to R. 4:57-1, remain an asset of the insolvent estate.
Transit is a Missouri based multi-state insurance company and as such its liquidation proceeding is governed by the Uniform Insurance Liquidation Act (the act). New Jersey
adopted the act in 1975, N.J.S.A. 17:30C-1 et seq. and Missouri did so in 1976, Mo.Ann.Stat. § 375.950 et seq. (Vernon 1976). New Jersey and Missouri therefore are "reciprocal states." See N.J.S.A. 17:30C-1(f). The act provides that the domiciliary receiver for the purposes of liquidating an insurer domiciled in a reciprocal state shall be vested by operation of law with title to all of the property, contracts and rights of action and all of the books and records of the insurer located in this State. See N.J.S.A. 17:30C-16.
In accordance with the aforementioned act, Lewis R. Crist meets the requirements of a "domiciliary receiver." He argues that the property rights to estate assets cannot be adjudicated or otherwise affected in proceedings outside of the receivership process set forth in the act. Accordingly, he states that this court may not order the withdrawal of the funds deposited by Transit as the receiver is endowed with the exclusive authority to marshal the estate. The linchpin of the receiver's argument is that the $100,000 deposited into court by Transit is an asset of the estate of the insolvent. I disagree.
Transit deposited its full policy limit into court pursuant to R. 4:57-1 which provides:
In an action in which any part of the relief sought is a judgment for a sum of money, or the disposition of a sum of money, a party, upon notice to every other party, and by leave of court, may ...