Michigan Compiled Laws
218-1956-81 - Chapter 81 Supervision, Rehabilitation, and Liquidation (500.8101...500.8160)
Section 500.8140 - Subrogation to Rights of Creditor; Distribution; Excess Received by Creditor.

Sec. 8140.
If a creditor, whose claim against an insurer is secured in whole or in part by the undertaking of another person, fails to prove and file that claim, the other person may do so in the creditor's name and shall be subrogated to the rights of the creditor, whether the claim has been filed by the creditor or by the other person in the creditor's name, to the extent that he or she discharges the undertaking. In the absence of an agreement with the creditor to the contrary, the other person shall not be entitled to any distribution until the amount paid to the creditor on the undertaking plus the distributions paid on the claim from the insurer's estate to the creditor equals the amount of the entire claim of the creditor. Any excess received by the creditor shall be held by him or her in trust for the other person. The term "other person", as used in this section, is not intended to apply to a guaranty association or foreign guaranty association.
History: Add. 1989, Act 302, Imd. Eff. Jan. 3, 1990 Popular Name: Act 218

Structure Michigan Compiled Laws

Michigan Compiled Laws

Chapter 500 - Insurance Code of 1956

Act 218 of 1956 - The Insurance Code of 1956 (500.100 - 500.8302)

218-1956-81 - Chapter 81 Supervision, Rehabilitation, and Liquidation (500.8101...500.8160)

Section 500.8101 - Construction and Purpose of Chapter.

Section 500.8102 - Applicability of Proceedings Authorized by Chapter.

Section 500.8103 - Definitions.

Section 500.8104 - Commencement of Delinquency Proceeding; Jurisdiction; Stay of Proceedings.

Section 500.8105 - Receiver; Application for Relief.

Section 500.8106 - Cooperation With Commissioner; Obstruction or Interference Prohibited; Existing Legal Rights Not Abridged; Penalties; Petition for Relief.

Section 500.8107 - Official Bonds.

Section 500.8108a - Prohibited Conduct by Insurer.

Section 500.8109 - Orders; Determination; Supervision of Insurer; Restrictions; Compliance; Hearings; Notice; Time; Judicial Review; Review of Supervisor's Action; Violation of Supervision Order; Penalty; Enforcement of Supervision Order; Personal Li...

Section 500.8110 - Seizure Order.

Section 500.8111 - Confidentiality; Exception; “Third Parties” Defined.

Section 500.8112 - Rehabilitation of Insurer; Petition; Grounds.

Section 500.8113 - Order to Rehabilitate Insurer; Provisions; Filing as Notice; Title to Assets Vested in Rehabilitator; Accounting.

Section 500.8114 - Commissioner as Rehabilitator; Appointment of Special Deputies; Employment of Counsel, Clerks, and Assistants; Compensation; Terms; Expenses; Powers of Rehabilitator; Criminal or Tortious Conduct; Breach of Contractual or Fiduciary...

Section 500.8115 - Stay of Action or Proceeding; Purpose; Duties of Rehabilitator; Statute of Limitations; Laches; Standing of Guaranty Association.

Section 500.8115a - Netting Agreement or Qualified Financial Contract; Rights; Transfer; Duties of Receiver; Exception; Rights of Counterparties; Definitions.

Section 500.8116 - Order of Liquidation; Petition; Duties of Circuit Court; Order Terminating Rehabilitation; Restoration to Possession of Property and Control of Business.

Section 500.8117 - Liquidation of Domestic or Alien Insurer; Basis.

Section 500.8118 - Order of Liquidation; Provisions; Filing as Notice; Rights and Liabilities; Judicial Declaration of Insolvency; Accounting.

Section 500.8118a - Order Transferring Title to and Possession of Trusteed Assets; Actions of Court; Considerations.

Section 500.8119 - Order of Liquidation; Continuation of Policies in Force; Termination of Coverages.

Section 500.8120 - Dissolution of Corporation.

Section 500.8121 - Powers of Liquidator; Extended Reporting Period; Powers and Authority Not Exclusive; Delaying Sale of Assets.

Section 500.8122 - Notice of Liquidation; Filing Claims; Changes of Address.

Section 500.8123 - Notice by Agent to Policyholder; Report of Compliance; Penalty; Waiver.

Section 500.8124 - Order Appointing Liquidator as Bar to Action at Law or Equity; Full Faith and Credit to Injunctions; Intervention; Expense; Institution of Action or Proceeding on Behalf of Estate of Insurer; Period of Limitation; Statute of Limita...

Section 500.8124a - Guaranty Association or Foreign Guaranty Association; Court Standing; Right to Intervene; Jurisdiction.

Section 500.8125 - List of Insurer's Assets; Amendments and Supplements; Filing; Reduction of Assets to Liquidity; Submission of Assets for Disbursement.

Section 500.8126 - Transfers and Obligations as Fraudulent; Avoidance by Receiver; Retention of Property, Lien, or Obligation as Security for Repayment; Preservation of Transfer or Obligation; Perfection of Transfer; Transfer Creating Equitable Lien;...

Section 500.8127 - Transfer of Insurer's Real Property; Validity; Constructive Notice of Commencement of Proceeding in Rehabilitation or Liquidation; Judicial Sale of Real Property of Insurer; Validity of Transfer Against Receiver; Payment of Indebte...

Section 500.8128 - Preference Generally; Transfers Considered Made or Suffered; Lien Obtainable by Legal or Equitable Proceedings; Dissolution of Voidable Lien; Discharge of Property From Lien; Summary Jurisdiction; Hearing; Notice; Order; Liability...

Section 500.8129 - Claim of Creditor; Allowance; Excused Late Filing.

Section 500.8130 - Setoff or Counterclaim.

Section 500.8130a - Contributions of Parties; Determination by Court; Distribution to Stockholders; Recovery of Distributions; Limitations.

Section 500.8131 - Report of Liquidator to Court; Levy of Assessment; Order to Show Cause; Notice; Hearing; Determination; Enforcement.

Section 500.8132 - Amount Recoverable by Liquidator From Reinsurers; Reduction Prohibited; Reinsurer's Obligation to Insurer's Estate; Assumption of Obligations by Life and Health Insurance Guaranty Association.

Section 500.8133 - Payment of Unpaid Earned Premium; Recovery of Unearned Premium; Prohibited Credits and Setoffs; Violation; Penalty; Notice; Hearing; Appeal.

Section 500.8133a - Deductible Agreement; Collateral as Asset Maintained and Administered by Receiver; Jurisdiction of Circuit Court; Rights of Guaranty Association or Foreign Guaranty Association; Applicability to Delinquency Proceedings; Applicabi...

Section 500.8134 - Proposal to Make Early Access Disbursements; Effect of Insufficient Assets; Report; Provisions of Proposal; Notice of Application; Action on Application; Return of Early Access Funds; Limitation.

Section 500.8135 - Proof of Claims; Filing; Circumstances Permitting Late Filing; Receipt of Distributions by Late Filing Claimants.

Section 500.8136 - Proof of Claim; Statement; Form; Additional Information or Evidence; Judgment or Order Entered by Default or Collusion; Judgment or Order as Evidence of Liability or Quantum of Damages; Claims of Guaranty Association.

Section 500.8137 - Contingent Claims; Discounting Claims at Legal Rate of Interest; Claims Made Under Employment Contracts.

Section 500.8138 - Third Party Claim; Claim by Insured; Insured as Unexcused Late Filer; Recommendations of Liquidator; Withholding Dividends; Hearing; Payment of Insured; Reversions to Undistributed Assets; Delay in Final Payment; Filing of Several...

Section 500.8139 - Denial of Claim; Filing of Objections; Hearing; Notice.

Section 500.8140 - Subrogation to Rights of Creditor; Distribution; Excess Received by Creditor.

Section 500.8141 - Value of Security; Determination; Supervision and Control; Crediting Amount Determined; Deficiency Treated as Unsecured Claim; Surrender of Security to Liquidator.

Section 500.8141a - Payment of Special Deposit Claims; Priority; Transfer of Special Deposits.

Section 500.8142 - Priority of Distribution of Claims From Insurer's Estate; Class of Claims; Subclasses Prohibited; Order of Distribution; Assets in Separate Account; Definitions.

Section 500.8143 - Review of Claims by Liquidator; Investigation; Negotiation; Unresolved Disputes; Report on Claims by Liquidator; Approval, Disapproval, or Modification; Limitation.

Section 500.8144 - Distributions; Manner of Payment; Distribution of Assets in Kind.

Section 500.8145 - Disposition of Unclaimed or Withheld Funds.

Section 500.8146 - Application for Discharge.

Section 500.8147 - Petition to Reopen Proceedings.

Section 500.8148 - Retention or Destruction of Records.

Section 500.8149 - Audits.

Section 500.8150 - Conservator.

Section 500.8151 - Petition for Order Directing Commissioner to Liquidate Assets; Grounds; Notice; Order; Liquidator as Ancillary Receiver; Commissioner as Receiver; Paying Claims of Residents.

Section 500.8152 - Vesting of Title in Domiciliary Liquidator or Commissioner; Filing Claims.

Section 500.8153 - Petition Requesting Appointment of Ancillary Receiver; Order; Notice; Powers and Duties of Ancillary Receiver.

Section 500.8154 - Institution of Proceedings Under MCL 500.8109 to 500.8111.

Section 500.8155 - Filing of Claims; Proof; Conclusiveness of Final Allowance of Claims.

Section 500.8156 - Filing of Claims; Proof; Recommendation; Hearing; Notice; Appearance or Representation; Conclusiveness of Final Allowance of Claim.

Section 500.8157 - Prohibited Action or Proceeding.

Section 500.8158 - Controlling Order of Distribution; Equal Priority of Payment; Priority Against Special Deposits; Deficiency; Deferred Sharing; Surrender of Security and Filing Claim as General Creditor; Discharge of Claim.

Section 500.8159 - Failure to Transfer Assets.

Section 500.8160 - Repealed. 2001, Act 143, Imd. Eff. Oct. 26, 2001.