STATE ex. rel. CRAWFORD v. AMERICAN STANDARD LIFE INS. GUARANTY ASSN.

STATE ex. rel. CRAWFORD v. AMERICAN STANDARD LIFE INS. GUARANTY ASSN.
2001 OK CIV APP 152
37 P.3d 971
73 OBJ 192
Case Number: 94318
Decided: 11/09/2001
Mandate Issued: 12/14/2001
DIVISION III
THE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION III

STATE OF OKLAHOMA, ex rel. JOHN P. CRAWFORD, Insurance Commissioner, Petitioner/Appellee
and
OKLAHOMA LIFE & HEALTH INSURANCE GUARANTY ASSOCIATION, Intervening Petitioner
v.
AMERICAN STANDARD LIFE AND ACCIDENT INSURANCE COMPANY, a domestic insurer in the State of Oklahoma, Respondent
and
DAVID J. NICHOLAS INSURANCE COMPANY, INC.; DAVID J. NICHOLAS; and THE NICHOLAS EQUITY HOLDERS OF AMERICAN STANDARD LIFE INSURANCE CO., Intervenors/Appellants

APPEAL FROM THE DISTRICT COURT OF OKLAHOMA COUNTY, OKLAHOMA

HONORABLE NANCY L. COATS, TRIAL JUDGE

AFFIRMED

Chris L. Rhodes, III, Robert P. Redemann, Andrew D. Downing, Rhodes, Hieronymous, Jones, Tucker & Gable, P.L.L.C., Tulsa, Oklahoma, for Petitioner/Appellee
David J. Nicholas, Edmond, Oklahoma, Pro Se.

OPINION

BUETTNER, Presiding Judge

¶1 In 1991, American Standard Life and Accident Insurance Company (ASL) was placed in receivership. Efforts to rehabilitate ASL were not successful. In 1997, the trial court ordered it liquidated. Intervenors/Appellants, David J. Nicholas Insurance Company, Inc., David J. Nicholas, and The Nicholas Equity Holders of American Standard life Insurance Co. (collectively, Appellants)1, seek review and reversal of the order of the liquidation court denying them the right to intervene in the liquidation proceedings in order to pursue a claim owned by the Receiver.2, 3

The Court, having heard and considered the arguments of Counsel and being fully advised via memorandums of law, finds that the Nicholas Equity Holders' Amended Motion and Petition to Intervene should be denied in all respects for the following reasons:

IT IS THEREFORE ORDERED that the Nicholas Equity Holders' Amended Motion and Petition to Intervene is denied.

¶3 In their brief, Appellants assert four propositions of error:

Proposition I: The District Court erred in determining that the Nicholas Equity Group has no right to intervene.

Proposition II: The District Court erred in determining that the Nicholas Equity Group lacked standing to intervene.

Proposition III: The District Court erred in determining that the issues and claims set forth by the Nicholas Equity Group are settled law and barred by the doctrine of res judicata or claim preclusion.

Proposition IV: The District Court erred in determining that the issues and claims set forth by the Nicholas Equity Group are settled law and barred by the doctrine of collateral estoppel or issue preclusion.

¶4 Appellants contend the trial court erred in holding they were not entitled to intervene as a matter of right. In addition, they argue the court should have permitted them to intervene as a matter of permissive intervention. Appellants argue that

A. INTERVENTION OF RIGHT. Upon timely application anyone shall be permitted to intervene in an action:

1. When a statute confers an unconditional right to intervene; or

2. When the applicant claims an interest relating to the property or transaction which is the subject of the action and he is so situated that the disposition of the action may as a practical matter impair or impede his ability to protect that interest.

B. PERMISSIVE INTERVENTION. Upon timely application anyone may be permitted to intervene in an action:

1. When a statute confers a conditional right to intervene; or

2. When an applicant's claim or defense and the main action have a question of law or fact in common.

. . .

¶5 Appellee cites the Oklahoma Uniform Insurers Liquidation Act (OUILA,

A. Whenever under this article a receiver is to be appointed in delinquency proceedings for a domestic or alien insurer, the court shall appoint the Insurance Commissioner as such receiver. The court shall order the Insurance Commissioner forthwith to take possession of the assets of the insurer and to administer the same under the orders of the court.

B. As domiciliary receiver, the Insurance Commissioner shall be vested by operation of law with the title to all of the property, contracts, and rights of action and all of the books and records of the insurer, wherever located, as of the date of entry of the order directing him to rehabilitate or liquidate a domestic insurer or to liquidate the United States branch of an alien insurer domiciled in this state, and he shall have the right to recover the same and reduce the same to possession; except that ancillary receivers in reciprocal states shall have, as to assets located in their respective states, the rights and powers which are herein prescribed for ancillary receivers appointed in this state as to assets located in this state.

¶6 Oklahoma has long followed the rule that where a matter is addressed by two statutes, one specific and the other general, the specific statute prevails over the general one. Hall v. Globe Life and Accident Insurance Company of Oklahoma,

¶7 Appellants opposed the liquidation order, but that order is final. As to the right of stockholders in a corporate insurance company to intervene in a delinquency proceeding, at the liquidation stage, in any manner other than to file claim as Class 10 creditors, this may be a matter of first impression. None of the parties cite any Oklahoma court decision answering the question, and we are not familiar with such a decision. Appellee points out that numerous other states have statutes which are the same as or substantially similar to the OUILA. Other states have held that shareholders do not have standing to redress an injury to their insolvent insurer. See Franchise Tax Board of California v. Alcan Aluminum, Ltd.,

¶8 It becomes unnecessary to decide any other issue presented by the parties.

¶9 AFFIRMED.

¶10 HANSEN, C.J., concurs; JONES, J., sitting by designation, concurs.

FOOTNOTES

1 In the instant appeal, Appellants were represented by attorneys who filed a brief in chief. These attorneys filed a Motion to Withdraw which was granted. There has been no appearance or filings by any new counsel for Appellants or by any Appellant, Pro se. The individual Appellant is now deemed to be appearing pro se. The corporate Appellants are now unrepresented parties. The brief filed by Appellants' previous attorneys will be considered.

2 The current Insurance Commissioner and Receiver is Carroll Fisher.

3 Appellants previously appealed the order of liquidation. Before a decision on the merits was entered, they dismissed the appeal. The order of liquidation therefore stands as a final order. On April 15, 1999, Appellants filed a Petition to Vacate the Order of Liquidation pursuant to 12 O.S. 1991 §1031 et seq. They alleged irregularity, unavoidable casualty or misfortune, and fraud. The trial court denied the petition and they appealed. That appeal was dismissed for failure to prosecute. See No. 93,372. The order denying the petition to vacate stands as a final order. According to the brief of Petitioner/Appellee, the State of Oklahoma, ex rel. John P. Crawford, Insurance Commissioner (Appellee) and not denied by Appellants, prior appellate proceedings, other than the one being considered in this opinion include the following: Case No. 82,049 - voluntary dismissal of appeal by Nicholas; Case No. 82,692 - order appealed by Nicholas affirmed by memorandum opinion; Case No. 84,800 - order appealed by Nicholas affirmed by memorandum opinion; Case No. 84,863 - order appealed by Nicholas affirmed by memorandum opinion; Case No. 90,558 - voluntary dismissal of appeal by Nicholas; Case No. 91,701 - order appealed by Nicholas affirmed by memorandum opinion; Case No. 93,372 - Nicholas' appeal dismissed by the court for failure to prosecute; and, Case No. 93, 476 - Nicholas' appeal dismissed by the court for failure to prosecute. The list includes the two cases mentioned above.

4 As stockholders, equity holders, and creditors of ASL.

5 Appellee refers to the Order of Liquidation dated November 21, 1997, wherein the court found ASL to be $37 million insolvent. Nicholas appealed that order, but the appeal was dismissed.

6 This statute was amended in 2000, but the amendments did not change its meaning and are not material to the issue being considered.