Original Jurisdiction in case of William R. Muir, Jr., Acting Insurance Commissioner of the Commonwealth of Pennsylvania v. Transportation Mutual Insurance Company.
Regina L. Matz, Assistant Counsel, with her, Hannah Leavitt, Chief of Litigation, Albert J. Strohecker, III, Deputy Chief Counsel, and Paul Laskow, Chief Counsel, for plaintiff.
Hugh J. Hutchison, Sprecher, Felix, Visco, Hutchison & Young, for defendant.
Michael A. Dillon, with him, William R. Balaban, Balaban and Balaban, for intervenor, Skandia American Group.
Leroy E. Perper, White and Williams, for intervenor, Meridian Bank.
Donald A. Emeigh, Jr., for intervenor, Christiana General Insurance Corp. of New York.
Senior Judge Barbieri. Opinion by Senior Judge Barbieri.
[ 105 Pa. Commw. Page 157]
In this case, the Acting Insurance Commissioner of Pennsylvania (Commissioner), William R. Muir, Jr.,*fn1 in his capacity as Rehabilitator*fn2 of the Transportation
[ 105 Pa. Commw. Page 158]
Mutual Insurance Company, has petitioned this Court, pursuant to Section 16(d) of The Insurance Department Act of 1921 (Act), Act of May 17, 1921, P.L. 789, added by the Act of December 14, 1977, P.L. 280, 40 P.S. § 221.16(d), to approve a plan of rehabilitation of Transportation Mutual. Two minority creditors of Transportation Mutual have objected to the plan of rehabilitation. Having given careful consideration to the arguments of the objecting creditors, this Court shall approve the Commissioner's plan of rehabilitation.
Transportation Mutual is a domestic mutual fire and casualty insurance company organized under the laws of Pennsylvania. After it suffered a series of financial setbacks, the Insurance Department (Department) concluded its financial position was hazardous to the policy or certificate holders, its creditors, and the public. The Department filed and served a suspension order on Transportation Mutual on February 25, 1985, and a Petition for Liquidation, pursuant to Section 520 of the Act, 40 P.S. § 221.20, was filed with this Court on June 20, 1985. Thereafter, the Department and Transportation Mutual entered into a stipulation to seek the rehabilitation, rather than liquidation, of Transportation Mutual. On November 4, 1985, President Judge Crumlish of this Court entered an order pursuant to Section 515 of the Act, 40 P.S. § 221.15, appointing the Commissioner as the Rehabilitator of Transportation Mutual and continued the liquidation proceedings. The Commissioner, acting through a deputy rehabilitator, formulated a plan of rehabilitation. That plan was mailed to the known creditors of Transportation ...