§ 574. Insolvency or bankruptcy. 1. Priority of contributions. In the
event of the dissolution, insolvency, composition, or assignment for
benefit of creditors of any employer, contributions then and thereafter
due from such employer under this article, together with any interest
and penalties thereon, shall (1) be on a parity with taxes (other than
real property taxes), together with any interest and penalties thereon,
due the state of New York or any city thereof and (2) have priority over
all other claims, except taxes due the United States and wages due for
employment performed within the three months preceding such event. In
the event of an employer's adjudication in bankruptcy, judicially
confirmed extension proposal, composition, or reorganization under the
federal bankruptcy act, contributions then and thereafter due under this
article, together with any interest and penalties thereon, shall be
entitled to such priority as is provided in such act.

2. Discharge in bankruptcy. If the commissioner was given due notice
or had knowledge of the bankruptcy proceedings, the payment of
contributions due, together with interest and penalties thereon, which
accrued on or before the date of the petition for bankruptcy and which
remain unpaid upon the discharge of the employer in bankruptcy by a
court of competent jurisdiction, shall not be enforced unless civil
action or warrant proceedings are begun not later than two years after
the date of such discharge and their total amount is two thousand
dollars or more.