Summary
In Sylvander v Stewart (36 A.D.2d 567) it was found that the use of an affidavit against the Superintendent of Insurance of the State of New York, which contained a prayer for relief instead of a petition constituted a mere technical irregularity which resulted in no prejudice to the superintendent and was disregarded.
Summary of this case from Matter of JohnsonOpinion
January 14, 1971
Appeal from the Onondaga Special Term.
Present — Goldman, P.J., Del Vecchio, Witmer, Gabrielli and Henry, JJ.
Order unanimously reversed, without costs, and proceeding remitted to Onondaga Special Term for further proceedings in accordance with the following memorandum: Petitioners, who own shares of stock in Farmers and Traders Life Insurance Company to be acquired by the company in fulfillment of its plan to become a mutual life insurance company, appeal from an order of Onondaga Special Term which dismissed their motion for an order implementing appraisal proceedings pursuant to section 199 (subd. 4, par. [f]) of the Insurance Law. On August 10, 1967 the company, pursuant to the plan of mutualization, offered to purchase outstanding shares of the stock at $2,500 per share. Thereafter petitioners herein, being owners of 189 of the company's 3,000 shares, applied to the Supreme Court at Special Term for appointment of three appraisers to value their shares. While that proceeding and two other actions were pending, petitioners and the company entered into a settlement contract on May 21, 1970, for the company to purchase petitioners' stock at $10,000 per share. Petitioners agreed to dismissal of the pending actions and proceedings and to release the company, its officers and directors from all liability to them. The agreement further provided: "In no event shall this agreement become effective * * * until * * * the Company has received from the Superintendent of Insurance a statement in writing that he has no objection thereto." On June 16, 1970 the company sent the Superintendent a copy of the agreement with a letter of explanation. The Superintendent did not respond with the requested statement but stated that the contemplated settlement must be treated as a new offer and that an independent appraisal of the value of the capital stock should be obtained. Petitioners thereupon obtained an order which was served on the Superintendent requiring him to show cause why petitioners should not have the relief prayed for by them in their annexed affidavit which alleged that the failure of the Superintendent to specify his objections or register his consent to the agreement was arbitrary and illegal and not in accordance with the provisions of subdivision 4 of section 199 Ins. of the Insurance Law. Paragraph (f) of the subdivision of that section provides that the Supreme Court at Special Term may make any order appropriate to implement the provisions of the law. The action of the Superintendent in refusing to give any approval required by the law is subject to judicial review (Insurance Law, § 199, subd. 2, par. [f], cl. [a]). Special Term dismissed the application without prejudice to a proceeding under CPLR article 78. In our opinion Special Term should not have dismissed the proceeding as being improper in form but should have treated it as an article 78 proceeding and rendered a determination on the merits (CPLR 103, subd. [c]). The proceeding was properly commenced and jurisdiction of the Superintendent was acquired by service of the order to show cause (CPLR 304; 403, subd. [d]; 7804, subd. [c]). The use of an affidavit which contains a prayer for relief in place of a petition constitutes a mere technical irregularity which resulted in no prejudice to the Superintendent ( Matter of Sardino v. Finch, 35 A.D.2d 686) and it should be disregarded (CPLR 2001). The proceeding should be remitted to Special Term for a determination thereof on the merits.