Underwriters National Assurance Company v. North Carolina Life & Accident & Health Insurance Guaranty Assn

PETITIONER: Underwriters National Assurance Company
RESPONDENT: North Carolina Life & Accident & Health Insurance Guaranty Assn
LOCATION: Richmond, VA

DOCKET NO.: 80-1496
DECIDED BY: Burger Court (1981-1986)
LOWER COURT: State appellate court

CITATION: 455 US 691 (1982)
ARGUED: Nov 09, 1981
DECIDED: Mar 24, 1982

ADVOCATES:
Theodore R. Boehm - on behalf of the Petitioner
William S. Patterson - on behalf of the Respondents

Facts of the case

Question

Media for Underwriters National Assurance Company v. North Carolina Life & Accident & Health Insurance Guaranty Assn

Audio Transcription for Oral Argument - November 09, 1981 in Underwriters National Assurance Company v. North Carolina Life & Accident & Health Insurance Guaranty Assn

Audio Transcription for Opinion Announcement - March 24, 1982 in Underwriters National Assurance Company v. North Carolina Life & Accident & Health Insurance Guaranty Assn

Warren E. Burger:

The judgments and opinion of the Court in Underwriters National Assurance Company against North Carolina Life will be announced by Justice Marshall.

Thurgood Marshall:

The case is here on writ of certiorari to the North Carolina Court of Appeals.

That Court held that an Indiana court was without jurisdiction to adjudicate the rights of various parties in a $100,000 deposit held in trust by certain North Carolina officials.

Because it found that the Indiana court did not have jurisdiction, the North Carolina court refused to recognize the Indiana court's prior holding that all claims of the deposit were compromised, settled and dismissed by the final order entered by that Court during a rehabilitation proceeding.

We therefore ordered respondent Guaranty Association to liquidate the $100,000 deposit.

Petitioner, an Indiana stock insurance corporation, had deposited the $100,000 as a requirement of continuing to do business in North Carolina.

Petitioner argues that the North Carolina court was obligated to recognize the prior judgment of the Indiana court which compromised, settled and dismissed all rehabilitation claims against the petitioner.

Petitioner contends that since the Guaranty Association was actually a party to the Indiana litigation, it had an opportunity to raise its claims to the $100,000 deposit in that proceeding.

Having failed to do so, petitioner claims that the Guaranty Association is now barred by res judicata from asserting any right to liquidate the deposit.

And the North Carolina court was therefore obligated to get the Indiana court full faith and credit.

In the opinion filed today with the clerk, we accept petitioner's contentions and therefore reverse the judgment of the North Carolina Court of Appeals.

The Guaranty Association was a party to the Indiana rehabilitation proceeding.

The Indiana court clearly stated that all claims against petitioner including any claim to the $100,000 deposit had to be raised during the rehabilitation proceedings.

That Court also made clear that any claim not asserted by the party before it during the rehabilitation proceeding would be compromised and dismissed.

The respondents argue that the Indiana court did not have jurisdiction to adjudicate rights in the North Carolina deposit.

However as our prior decisions made clear, any argument that the Indiana court did not have jurisdiction to adjudicate the rights of the parties before it in the North Carolina deposit had to be raised in the Indiana proceeding.

As a party to that proceeding, the Guaranty Association had ample opportunity to question the jurisdiction of the Indiana court to settle this claim to the deposit.

Having failed to exclusively raise to challenge, it is barred by principle to res judicata from collaterally raising this question in North Carolina.

The judgment of the North Carolina Court of Appeals is therefore reversed.

The case is remanded for further proceedings not in consistent with this proceeding.

Justice White has filed a separate opinion concurring in the judgment in which Justice Powell and Justice Stevens joined.

Warren E. Burger:

Thank you, Justice Marshall.