STEPHENS V AMERICAN HOME ASSURANCE CO ET AL STEPHENS V AMERICAN RISK MANAGEMENT INC ET AL STEPHENS V NATIONAL DISTILLERS AND CHEMICAL CORPORATION ET AL STEPHENS V AMERICAN INTERNATIONAL INSURANCE COMPANY ET AL

(1993) 2 Re LR 165

United States District Court Southern District of New York

Before District Judge John S Martin Jr

Insolvency - Action by liquidator of insolvent reinsurance company, former captive, against former owners, retrocessionaires, cedants and managers - Whether defence of fraud and remedy of rescission for fraudulent inducement available - Whether retrocessionaires of insolvent reinsurer could avoid contractual obligations - Whether corporate veil should be pierced - Alleged question of fact as to whether reinsurance company was undercapitalized - Whether former owner’s dominance of captive resulted in fundamental unfairness to retrocessionaires - Whether fact that reinsurance company was insolvent rendered dividends paid by it illegal - Whether state insurance officials could be liable for failure to perform duties properly.