204 N.E.2d 550 | Ohio Ct. App. | 1965
Appellee, William R. Morris as the Superintendent of Insurance of Ohio, has filed a motion to reduce the above appeal from one on law and fact to one on law only.
On March 31, 1964, appellee filed a petition in the Common Pleas Court asking for an order to rehabilitate or liquidate the Investment Life Insurance Company of America, an Ohio corporation, and for authority to take over the affairs of the company pursuant to Section
On July 2, 1964, Joseph L. Osberger was made a party defendant, and the other appellants were made parties at later dates. Various other proceedings occurred. Involved in this appeal is the motion of the appellants on December 5, 1964, to vacate the order of April 8, 1964. The ground stated is that the order of April 8, 1964, was not based on any statutory ground — specifically that neither a majority of the directors nor of the shareholders had consented to the order of April 8, 1964, and no *332 other statutory ground for such an order has yet been found to exist. The motion was overruled, and appellants filed a notice of appeal on law and fact.
Appellee contends that this is not a "chancery" case and, therefore, is not appealable on questions of law and fact. That proposition of law was eradicated some 20 years ago by amendment to Article
However, after careful consideration of this appeal, it is our conclusion that the order appealed from is not a final order, and the appeal must be dismissed, sua sponte, in its entirety.
Proceedings in relation to the appointment or removal of receivers are special proceedings, and an order affecting a substantial right made in such a proceeding is a final order. See Cincinnati, Sandusky Cleveland Rd. Co. v. Sloan (1876),
"Under general appeal statutes limited to allowing appeals from final, as distinguished from interlocutory, decisions, and in the absence of additional statutory authority, it has been generally held that an order refusing to discharge, or vacate the appointment of, a receiver is ordinarily not subject to direct appeal."
It is true, as the quotation indicates, that several cases have held such an order is appealable under exceptional circumstances. We have found no authority in Ohio for such an "exceptional circumstances" qualification, although a remark in one case might be so interpreted. See Cincinnati, Sandusky Cleveland Rd. Co. v. Sloan (1876),
It is true that on the record there appears to be a strong basis to believe that the order of April 8, 1964, was made without any showing of a ground required by Section
A receivership is not an end in itself. It is simply a remedy or means of accomplishing a result. The fundamental purpose of this proceeding under Chapter 3903, Revised Code, is the rehabilitation or liquidation of the company. Under Section
The first paragraph of Section
"Upon the entry of a court order directing rehabilitation, the Superintendent of Insurance shall immediately proceed to conduct the business of the company affected and shall take such steps as are expedient toward removal of the causes and conditions which have made such proceedings necessary."
The second paragraph of Section
Under the third paragraph, if it later appears that rehabilitation is not feasible, he "may apply to the court in the same proceeding for an order directing the liquidation * * *."
Further, under the last paragraph, "If at any time" it appears that the causes for the proceedings have been removed (and implicitly if it is found that no sufficient cause ever existed), he may apply for the termination of the proceeding and a hearing must be held.
On the other hand, if the superintendent finds that rehabilitation is not feasible, he must apply for an order directing liquidation and a hearing must be set and, in our opinion, notice given as provided in Section
The first paragraph of Section
"Upon the entry of a court order directing liquidation, the Superintendent of Insurance shall immediately proceed to liquidate the property, business, and affairs of the company."
It is true that that section does not explicitly require an application, notice and hearing on the order to liquidate. However, that is implicit from the provisions of Section
Succinctly put, the statutes contemplate that the superintendent, upon appointment, is to examine the affairs of the company, and then recommend to the court either termination of the proceeding, a rehabilitation plan or liquidation. Notice and a hearing must be given on the recommendation. This hearing and determination is the essential nub and decisive action in the whole proceeding. It is, in effect, analogous to a *335 judgment in a foreclosure proceeding, and all subsequent proceedings are the execution and carrying out of that fundamental determination. Of course, there are provisions for reappraisal and modification of the determination as circumstances may warrant. In our opinion, the determination on that hearing is a final order affecting a substantial right and appealable. Accordingly, the appellants here have adequate protection in the form of the hearing on the recommendation. They may contest there the necessity for the continuance of the receivership or the feasibility and desirability of the specific recommendation. They may obtain a review of any adverse decision by appeal.
It should be noted that the superintendent has applied for authority to sell a major asset of the corporation, although he has not yet applied for and obtained authority to liquidate or rehabilitate this corporation. Incidental sales of minor assets such as may be required in the normal operations of the business are undoubtedly authorized in the interim between the appointment of the superintendent and the court approval of a plan of action. A sale which has substantially the effect of liquidation without a prior determination that liquidation should be undertaken would be improper.
Since the order appealed from is not a final order, this court has no jurisdiction, and the appeal will be dismissed.
Appeal dismissed.
DUFFY, P. J., and TROOP, J., concur. *336