People Ex Rel. Schacht v. Prestige Casualty Co.

We review a constitutional challenge to that part of the Insurance Code (Code) which governs the way assets of an insurance company are distributed after liquidation. Section 205(1) of the Code (215 ILCS 5/205(1) (West 1994)) sets out seven claim categories in the order they are to be paid. They begin with the costs and expenses of administration and descend to the proprietary claims of shareholders or other owners. General creditors are listed fifth and include claims for attorney fees incurred by the company in a liquidation action brought by the Director of Insurance. The trial court found…