N.Y. Real Property Law § 428: Action against assurance fund

§ 428. Action against assurance fund. Any allowed claim for

indemnity shall be paid in the same manner as other claims against the

county. In the city of New York a claim shall be passed upon and

approved by the city register and by the corporation counsel of the city

before payment is allowed. The rejection of a claim by the proper

county officials (or in the city of New York by the city register and

corporation counsel) shall not preclude the claimant from bringing an

action to recover such claim. No claim or judgment on a claim for

indemnity shall be binding on the county or on the county treasurer (in

New York city the commissioner of finance) for an amount exceeding the

amount credited to the assurance fund. If the amount credited to the

assurance fund is insufficient to pay the claim or judgment in full, the

unpaid balance shall bear interest at the legal rate and shall be paid

out of the first moneys coming into said assurance fund or the county or

city general fund after the assurance fund has been terminated pursuant

to section four hundred twenty-six of this article. If any right of

action against any person for damages for negligence or other cause, or

under any covenant or contract of warranty or guaranty or otherwise,

exists in favor of the person to whom indemnity is paid, the county

treasurer (in New York city the commissioner of finance) shall be deemed

to be subrogated to such right and may bring an action to recover

thereunder. Any amounts recovered by the county treasurer (in New York

city the commissioner of finance) under such an action shall be credited

to the account of the assurance fund. Until the assurance fund provided

as aforesaid shall have been exhausted, payment for any such losses or

damages shall be made out of such fund.