(a) Section 111(a) of the Retirement and Social Security Law, as added by chapter 947 of the Laws of 1956, and section 412 of the Retirement and Social Security Law, as added by chapter 1000 of the Laws of 1966, provide that in any case where the Retirement System is required by order of a court of competent jurisdiction to pay over a benefit which is payable in installments, and which is predicated upon the life of a beneficiary to a payee other than the recipient who ordinarily would have taken the benefit pursuant to the provisions of this Article, such payee must file a bond indemnifying the Comptroller against loss by reason of excess payments to such payee. Experience has shown that it is virtually impossible for the payee to secure such bonds from surety companies.

(b) Section 14 of the General Construction Law provides that whenever a provision of law requires the filing of a bond, the execution of an undertaking to the same effect should be deemed compliance (Burns v. Watertown, 213 N.Y.S. 90; Tully v. Lewitz, 198 N.Y.S. 829). The term undertaking is defined in section 2501 of the Civil Practice Law and Rules to be any instrument which evidences an agreement by any person to be bound in a stated amount upon the failure of the condition of the instrument. To lessen the burden of securing a surety bond, compliance with the mandates of sections 111-a and 412 of the Retirement and Social Security Law may be had by the filing of an indemnification agreement prepared by the Comptroller.