State Codes and Statutes
Statutes > Utah > Title-31a > Chapter-27a > 31a-27a-60331A-27a-603. Allowance of claims.
(1) (a) Except as provided in Subsections (11) and (12), the liquidator shall:
(i) review all claims filed in the liquidation proceeding in accordance with this chapter;and
(ii) further investigate a claim, as the liquidator considers necessary.
(b) Consistent with this chapter, the liquidator may allow, disallow, or compromise aclaim that will be recommended to the receivership court unless the liquidator is required by lawto accept the claim as settled by a person, including an affected guaranty association, subject to astatutory or contractual right of the affected reinsurers to participate in the claims allowanceprocess.
(c) Notwithstanding any other provision of this chapter, a claim under a policy ofinsurance may not be allowed for an amount in excess of the applicable policy limits.
(2) (a) Pursuant to the review required by Subsection (1), the liquidator shall providenotice of the claim determination to the claimant or the claimant's attorney.
(b) The notice required by this Subsection (2) shall set forth:
(i) the amount of the claim allowed by the liquidator, if any;
(ii) the priority class of the claim as established in Section 31A-27a-701; and
(iii) if the claim is denied, the reason for the denial.
(c) In regard to a claim to be allowed pursuant to Section 31A-27a-605, preliminarynotice of the amount of the claim determination shall be provided to any reinsurer that is or maybe liable in respect to the claim at least 45 days before the day on which notice is provided to theclaimant pursuant to this Subsection (2).
(d) In regard to a claim being allowed other than pursuant to Section 31A-27a-605, thenotice sent to the claimant may be provided to any reinsurer that is or may be liable in respect tothe claim.
(e) If no timely objection is submitted, the claim determination is binding on thereinsurer upon allowance.
(3) (a) Within 45 days after the day on which the notice described in Subsection (2) ismailed, the claimant noticed may submit a written objection to the liquidator.
(b) An objection provided for under this Subsection (3) shall clearly set out:
(i) all facts and the legal basis, if any, for the objection; and
(ii) the reasons why the claim should be allowed at a different amount or in a differentpriority class.
(c) If no timely objection is submitted, the claimant may not further object, and thedetermination is final.
(d) The liquidator may accelerate the allowance of a claim by obtaining a waiver of anobjection.
(4) (a) A claim that is not mature as of the coverage termination date established underSection 31A-27a-402 may be allowed as if it were mature, except the claim shall be discountedto present value.
(b) A claim is not mature if payment on the claim is not yet due.
(5) The following is not required to be considered as evidence of liability or of theamount of damages:
(a) a judgment or order against an insured or the insurer entered:
(i) after the day on which a successful petition for receivership is initially filed; or
(ii) within 120 days before the day on which the petition is initially filed; or
(b) a judgment or order against an insured or the insurer entered at any time by default orby collusion.
(6) A claim under an employment contract by a director, officer, or person in factperforming similar functions or having similar powers is limited to payment for services renderedbefore an order of receivership, unless explicitly approved in writing by:
(a) the commissioner before an order of receivership;
(b) the rehabilitator before the day on which the order of liquidation is entered; or
(c) the liquidator after the day on which the order of liquidation is entered.
(7) The total liability of the liquidator to all claimants arising out of the same act orpolicy shall be no greater than the insurer's total liability would have been were the insurer not inliquidation.
(8) (a) The liquidator shall disallow a claim that is for or determined to be for a deminimis amount.
(b) A de minimis amount is an amount equal to or less than a maximum de minimisamount approved by the receivership court as being reasonable and necessary for administrativeconvenience.
(9) A claim that does not contain all the applicable information required by Section31A-27a-602:
(a) does not need to be further reviewed or adjudicated; and
(b) may be denied or disallowed by the liquidator subject to the notice and objectionprocedures in this section.
(10) (a) The liquidator may reconsider a claim on the basis of additional information andamend the recommendation to the receivership court.
(b) The claimant shall be afforded the same notice and opportunity to be heard on allchanges in the recommendation as in the claim's initial determination.
(c) The receivership court may amend the receivership court's allowance or disallowanceas appropriate.
(11) (a) The liquidator is not required to process claims for any class until it appearsreasonably likely that property will be available for a distribution to that class.
(b) If there are insufficient assets to justify processing all claims for a class listed inSection 31A-27a-701, the liquidator shall:
(i) report the facts to the receivership court; and
(ii) make appropriate recommendations for handling the remainder of the claims.
(12) A claim of a lessor for damages resulting from the termination of a lease of realproperty shall be disallowed to the extent that the claim exceeds the sum of:
(a) the rent reserved by the lease, without acceleration, for the greater of one year, or15%, not to exceed three years, of the remaining term of the lease, following the earlier of:
(i) the day on which the petition is filed; and
(ii) the day on which the lessor repossessed, or the lessee surrendered, the leasedproperty; and
(b) any unpaid rent due under the lease, without acceleration, on the earlier of the datesspecified in Subsection (12)(a).
Enacted by Chapter 309, 2007 General Session
