Gentile v. Air Line Pilots Mutual Aid Ass'n

Defendant’s motion by special appearance, under section 237-a of the Civil Practice Act to set aside service is granted.

Plaintiff attempted to effect jurisdiction over defendant by service in accordance with section 59-a of the Insurance Law. That section operates to subject certain foreign unauthorized insurers to the jurisdiction of the courts of this State. However, defendant is a mutual aid association formed exclusively of members of the Air Line Pilots Association, and as such is exempted from operation of section 59-a by virtue of section 466 (subd. 1, par. [b]) of the Insurance Law. Accordingly, any attempted service of process under section 59-a must he termed ineffective.

Plaintiff’s contention that the conditions contained in subdivisions 2 and 4 of section 466 have not been complied with, is without merit. The monetary limitations of $350 annual dis*292ability benefits and $500 annual death benefits concern only paragraph (c) of subdivision 1; defendant’s exemption is by virtue of paragraph (b) of that subdivision. In addition, subdivision 1 of section 466 specifically provides that unincorporated associations are included within its exemptions. Moreover, the bold-faced printing requirements of subdivision 4 of section 466 pertain to the written policy, and not to the by-laws of the association.

Finally, plaintiff’s contention that the public policy contained within section 59-a will be frustrated is equally without merit. Section 466 has provided exemptions for certain classes of fraternal benefits societies. The exemptions extend to the requirements of obtaining a license and “ all other requirements of this chapter”. Although section 59-a technically is not a “requirement”, section 59 which should be read in conjunction with section 59-a, is a “requirement”. Section 59 requires foreign insurers to appoint the Superintendent of Insurance as their agent to accept service of process. It is clear from a reading of section 466 that certain classes of fraternal benefits societies were intended to be exempt from the operation of section 59. Therefore it follows that this same exemption would apply to section 59-a as well. Section 59-a is intended to render amenable to process those foreign insurers who have violated section 59 and not those who have received exemptions from it.