(a)  Any rehabilitation, liquidation, administrative supervision, or conservation of a nonprofit legal service corporation organized under this chapter shall be conducted under the supervision of the director of business regulation pursuant to chapters 14.1, 14.2, and 14.3 of this title. The director of business regulation may apply for an order from the superior court directing the director of business regulation to rehabilitate, liquidate, or conserve a nonprofit legal service corporation upon any one or more of the following grounds:

(1)  That the nonprofit legal service corporation is insolvent; for the purposes of this section, the term “insolvent” means the inability of the nonprofit legal service corporation to meet its debts and financial obligations as they become due;

(2)  That the nonprofit legal service corporation fails or refuses to comply with a lawful order of the director of business regulation reasonably designed to correct unsound business policies or practices which, if uncorrected, could reasonably lead to insolvency as defined in subdivision (1) of this subsection; or

(3)  That the nonprofit legal service corporation’s financial condition is such as to render its further transaction of business hazardous to the public or its subscribers or members.

Terms Used In Rhode Island General Laws 27-20.3-11

  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Legal service: means the professional services rendered by persons duly licensed under the laws of this state to engage in the practice of law who have agreed to perform services as may be specified under any nonprofit prepaid legal service plan, and to accept payment for the services on the basis provided in the plan. See Rhode Island General Laws 27-20.3-1

(b)  A claim by a health care provider shall not be asserted against any subscriber or member of the nonprofit legal service corporation in the event of the rehabilitation, liquidation, conservation, or administrative supervision of the nonprofit legal service corporation.

History of Section.
P.L. 1993, ch. 180, § 23.