*1 Company Cosmopolitan Life Insurance Insurance and Arch E. Commissioner Northington, Banking of the State of Tennessee and Attorney F. George General McCanless, State of Tennessee.
(Nashville, 1956) Term, December
Opinion February 8, filed 1957.
Rehearing April 1, Denied 1957. *3 Denny Memphis, Leet- & Taylor, & Taylor, Costen appellant. for Nashville, wich, ap- Attorney General, Wilson, Assistant Jack pellees. opinion
Mr. delivered the Justice Burnett Court. brought suit Company
This was the Insurance un- Declaratory Judgments der the 23- Sec. statutes, seq., Chap- 1101 et declaring. for the T.C.A., ter 195 of the Acts of Public 1955 unconstitutional. *4 original
The Chancellor, after the bill had been amend- supplemented, ed and sustained demurrers and held that appeal Act was constitutional. This resulted. We argument, have heard had briefs tiled, read authori- given thought ties and considerable to the matter and are ready questions now for a determination of the involved.
545 Chapter 1955 is entitled Acts of Public of the regulate captioned, insurance and bnrial Act “An ’’ orig- penalties provide thereof. This Act for violation The Bill 336. Senate No. in Senate Senate inated steps that various were for 1955 taken shows the Journal page among on into others to enact hill law and appears: Journal this 597 of the Senate Banking “Insurance and Speaker: Insurance Your Committee on “Mr. carefully report Banking begs con- we leave to passage. 336, for Bill No. sidered recommend Senate Chairman.” “Eslick, separate attempts life Act manner the In concise requir- undertaking business from insurance business companies pay ing beneficiaries under insurance life money policies merchandise in funeral instead of their pro- prohibitory in that services. Act thus contracting with life hibits bury undertaking in- particular establishments to company. sureds’ analysis alleges final bill in case
In Article of our in violation Section this Act is provisions of “the Section Constitution; violation Amendment the Constitution of the Fourteenth provisions “the of Article violates States;” United Tennes- 8 of the Constitution of the State of Section provisions “the that the violation of see;” 8, of' the Constitution of the State Article Section ques- We will consider each of these Tennessee.” attempt separately arrive what con- tions at thereto. sider answer a correct
546 alleges among finally other bill as us reaches perfectly
things awas business that the burial insurance pub- great benefit lawful in a to the business and resulted public general; lic the was inoffensive that business safety, State; of morals of the citizens the health and to- and associations are that burial ques- day prior the were the enactment of Act in literally respectable providing burial for funds tion for century nearly people half thousands of who for a a community upon charges the would have been Fields, it not buried in Potter’s had would been companies; been that citi- for burial insurance the advantageous placed of the zens State have been an position being of able contract for their funeral and disposition of bodies at a fraction cost the their alleged that otherwise. It further services the cost year purchased by payment if 20 funeral, $800 an a policy, per age at burial insurance 37c week the policy 35. It is that under form issued also shown by company, hereto, which is that attached as exhibit year period if the insured dies within a service weekly paid premiums. him It costs the amount his year past payment is also shown if he that lives period maximum that the cost of this funeral $800 for only him is also shown survivors that the $384.80. option taking insured have either fu- policy payment as neral contracted for in the or a cash policy. provided in alleges prior The bill also to the burial insurance wealthy people get business that no but one a re- could spectable general burial and that the attitude of most get every penny undertakers was “to the traffic brought fact bear”; would that this was about many fact unable were to collect their undertakers burying person bills and that the services a dead person lot of times a number could not buried for days among because relatives had scatter about money bury person; raise themselves and *6 by by of reason taken small out a weekly premium they would have decent burial' upon their death.
By companies of the Section 1 life insurance Act similarly prohibited issuing others situated con- are from they designate any particular person in tracts which or company the conduct the to funeral insured, of prohibited entering any type are from into of contract arrangement which otherwise restricts freedom of for funeral services. companies prohibited 2,
Under Section the are from issuing any legal payable thing than contracts other tender of the United States. Contracts' effect at the passage by time of the of Act the not affected provision. questioned companies 3,
In of Section the Act such prohibited entering it affects are contracts into providing with funeral directors that such funeral direc- persons tors shall the funeral conduct of insured companies. permits section, This benefi- the however, ciary policy assign policy under .the the an under- liabilty taker death after the of insured and the has after accrued.
By companies the 4, Section covered this Act are any forbidden to into enter contract to furnish funeral upon any person the merchandise or services death of By insured. the Section Commissioner of Insurance agents of and. license revoke the is directed makes the vio- the Act and Section violation the lation misdemeanor. the insisted that
As was first indicated above Consti our is in of Article Section 17 of Act violation caption indicates that because tution regulate pro is to bill insurance whereas burial indicated) pro (as body visions in the the Act above paid hibit burial insurance in merchandise and thus body it is that the the bill broader said than purposes caption. One of Con Section against surprise protect people legis is to stitution caption title lation. It is said that-under this prohi nothing indicate Act there in the world body bitions which are contained and it inconsistency there thus said that is this between since *7 caption body the of the it the unconstituional Act is inconsistency. argument and void for on this length feature is are satisfied extended to some but we that this contention is erroneous here we because do not any provi of this believe that there has been violation the of sion Constitution. two-subject
“The the clause of Constitution in- was prevent to tended a in the combination same act of laws upon subjects; wholly the to avoid union of different incongruous unity one matters in secure statute; to purposé legislative of Bell Hart, in enactments.” 143 Tenn. 996. 587, 223 S.W. speaking the
The late Chief
Green in
Justice
on
sub
ject
Hailey,
in
247, 252,
Davis v.
Tenn.
“So far as section 17, a provisions toward act directed various of an expressed purpose in the purpose, is common provi- the several make no if would difference title, legislature. powers the of all of sions the act involved syntax regulates the section This Constitution imposes pow- upon It no the statutes. restriction upon commingling powers, ers nor the exerted, provisions long incon- the statute are not so as the subject expressed gruous germane in and are caption.” again 140 Tenn. in Kizer v. State, And Court said S.W. that: 582, 589, ' unity subject “The to be looked for object of with reason statute; ultimate cannot accomplishment step held that each towards object separate he act, an end or should embodied in steps general long same so are of the na- system, legitimately parts ob- end, of one ture and ject, constitutional.” act is Act that as stated
The obvious
regulate
insurance.
we read the
the title
burial
When
regulated
ex
burial insurance
find that
writing
keeping
in
tent
furnishing
bury people
em
funeral to
surance in
burying.
ploy
seems
us
do
undertakers
regu
nothing incongruous or out of line
thus
there is
*8
recently
comparatively
lating
this business. We
questions in
similar
the case of Elliott
Fu
discussed
v.
qua,
Rule
185 Tenn.
S.W.2d
Town
and
195 Tenn.
The Act is not is because it noticed that under of2, Section the Act that contracts in passage force at the time of of the Act are not affected. permits people Likewise Section 3, who have insur- money payable assign ance which is this insurance. assignment For these reasons this of error must be overruled.
Next it is said that broader than caption. excerpts A number of the from cases Tennessee quoted proposition above are somewhat in answer logical and we think are answers. It is obvious from reading caption attempt that the was ing regulate Clearly provisions burial insurance. germane subject of the Act are to this our and meet requirements subject. constitutional gather on the We reading many authorities under this Section subject properly Constitution that if the set caption necessary give out in the is not details. deals, body If the of the Act with the matter which germane subject expressed caption in the then the Act is many, many There have constitutional. been subject cases on in Volume 185 Tennessee, some
551 atnong are that two or cases will others found, three be 1019, Harris, of Tenn. S.W.2d Caldwell question. which cites other cases on the pro- reading A of casual of its the Act shows that all pro- these visions relate bnrial Some of insurance. prohibitory visions it is course it true but of necessary everything caption to set out is to in the body long doings done in so the Act germane Act are title. We thus for these reasons think that is not. broader its Act than caption. is next that the Act is in violation contended
Article 1, Section Fourteenth Amendment of the As we know, United States Constitution. all Arti cle Section 8 of our Constitution the Fourteenth Amendment of the United Constitution are so States closely aligned ques are almost identical. Legislature, tion under contention is whether the police may power, constitutionally regulate under its life companies by requiring pay them to benefits policy money their under instead of in funeral mer by prohibiting designating chandise, them from their certain contract undertakers to conduct funerals by prohibiting insureds, of their contracting provide from with undertakers funeral for their insureds. services
We first notice Act does that the not interfere with right the, disposition citizen to contract of a for the his body apparently afer death. This was his admitted in the says: appellant’s brief he when Complainant’s provi-
“It contention that these against sions discriminate burial insurance companies by prohibiting State the citizens disposition contracting their with them for the permits bodies after but same time death, at undertaking estab- contract with an same citizens to (Italics thing.” ours.) the same lishment do *10 pro- closely the we the Act When refer and examine to hibitory prohibition is in the show that the clauses Act against companies, benefit life insurance fraternal so- issuing or from cieties, or similar associations policies certificates, and etc., life insurance and contracts anything people this but State in United States to money. in individual is not his The citizen restricted disposition body right to for the to contract his dispose usually body. who of the contract with those certainly the It this in all is law in State and company, as others far as know that an writing having right granted the franchise of been subject con State, contracts insurance in to the only State, trol of not as to the nature the business may may they but the form of it do, also to contract Appleman, Practice, make. Insurance Law Vol. And statements as above Sec. makes similar that many made and cites from in the authorities States regulations long As as the .rea Union that effect. are upheld.’ same will and should sonable To the p. effect see 44 secs. 55 C.J.S. 518. Insurance, company that thus when the insurance would seem to us accepts by granted Legislature it benefits it very position challenge good be in should then put privilege it for the burdens on it which enjoys Legislature. subject By will to the nothing retroactively nothing away is done is taken — except right company write its the insurance prohibited - the future the kind of insurance this Act. fit Legislature wisdom its has seen
When type consis legislation the courts of this to enact tently was a that this constitution felt that under our not, Legislature that we should one matter upon. Here violated, encroach Constitution unless the things known has before facts apparently Legislation- which' is when'- enacts thenrand public - safety, public protection for" public in its wisdom morals. court health or- the' Legis right upon this act or should not encroach ago Court'long reiterated Chief This said as lature. Tenn. 677, Carter, Petition Justice Neil in 13: S.W.2d 11, determining we are not concerned
“Furthermore *11 constitutionality it dictated ‘whether was the of an policy, by it ulti a whether will or a wise foolish mately public good, it or whether is the redound to equity. contrary justice These con to natural and solely Legislature.’ Motlow v. for the siderations 177, L.R.A. State, 188, Tenn. 145 547, 589, 125 S.W. 7 1 1916F, 7.” ' only purpose is to determiné such matters Our under plausible reason for enact- whether or not'there legislation. all time's is true court' at ment such constitutionality- pass right reserves- the on inquire policy doing so not into we do but statutes why background Legislature, is, the factual that they plausible reason is a back did i-f there many legislation. ex cited in State rel. Loser v. See cases Optical pages Stores, 446 and National 189 Tenn. at ns 263. at unreasonable for S.W.2d It is not all Legislature had the mind believe that protection public legislation enacting safety, people. public public health and/or morals of its legislation Having thus determined that the reasonable certainly under these sections of and of Constitution o.ur United Constitution .the Act is States not unconstit utiona l. by
We held in this'State contracts issued burial life insurance associations are con by may regulated tracts be the State. State Attorney Mortuary ex rel. District v. Mutual General Inc., 166 Tenn. Ass’n., S.W.2d ex 664, State rel. Attorney-General Services, Funeral Smith 177 Tenn. 41, 145S.W.2d 1021.The could have in enact ing legislation entirely believed—it is reasonable— that burial associations and which had been societies many fraternal societies, sanctioned as benefit were, in organized sponsored instances not the members be benefited but funeral directors who used such procuring as means associations business their They undertaking establishments. could have likewise entirely believed reasonable that assessments upon according were made the members wishes of benefiting the funeral director in manner society. membership many Thus these and other in say entirely stances could where we cited it is legislation passed reasonable that this was for the bene people fit of the of the State and it is not unreasonable *12 legislation. Jurisprudence
Thus is that the writers American page said Volume of that work at 1027,that: power police limited of the state “The preservation good necessary regulations for the prevention safety. public health The or the and order imposition, cheating and deceit, of fraud and and may pre- power. equally a state Therefore, within the judgment, regulations will as, in its scribe all people against conse- secure secure tend any may quences institute reasonable and of fraud remedy frequency required by preventive fraud, difficulty experienced by in circum- individuals or the especially venting have not when other means it, proved efficacious.” to be Michigan Supreme before in 1951 had Court
The which was the State of 1949 an Act of purposes with the Act here identical all intents Metropolitan in the case of Funeral That Court attacked. System 331 Mich. N.W.2d v. Forbes, Ass’n. constitutionality Among the Act. 133, sustained things court other said: plaintiff policy by issued forth in detail
“The sets to be furnished items services various complete plaintiff funeral burial, without policy quality. designating is an ‘industrial’ their weekly premium provided for, with a and un- one, people doubtedly incomes who inex- of low reaches beneficiary, surviving perienced in business. The with very caused emotions recent death strained family, is unable to tell whether the funeral ser- easily imposed upon he are worth can vices $250 large pay additional amounts for more elaborate provided policy. for in the funeral Suffice it to than legislature say its discretion in the power police has its condemned exercise of and for- *13 556 by supra. practice
bidden was said No. 257, As Act Family Security 336 Co., in Daniel Insurance v. Life 10 A.L.R.2d 550; U.S. 69 93 L.Ed. 553, 632, S.Ct. 220, say en 945: tbat Carolina ‘We cannot South titled to call insurance evil. the funeral business an say Nor to the we that statute has relation can no inquiry those There our must elimination of evils. p.”' sto Supreme
It seem would thus States that United Supreme quotation Michigan Court Court of. prohibiting’ from that have sanctioned Court statutes payment providing for insurance contracts in funeral gone merchandise likewise service's. further It'has approved prohibiting á state statute com insurance panies agents operating and their in the undertak ing serving agents business and undertakers from companies. supports insurance This in line’and "the conclusions hereinabove reached stated. Kenton & Campbell Goodpaster, Ky. Burial Benev. Ass’n. v. 304 opinion (the 233, 200 120, S.W.2d in this case refers Kentucky question) earlier cases on the and State Gateway Mortuaries, 87 Mont. 225, 156, P. by appellants. A.L.R. relied on As see it we clearly these cases' have marked distinctions from now before will be reading. seen us as a careful Be prefer may, Michigan as. it to follow the case. appears assignment It second thus must- overruled.
n (9) question contended that is next Act in violates Article Section of our Constitution. Under assignment question isit insisted Act that the n legislation arbitrary class -an nature. The burden of against discriminates Act insistence is that prohibiting companies by from contract- them bury while citizens ing snch the State to with citizens of bnry permits snch undertakers contract citizens. undertaking everyone knows that
Of course *14 burying purpose of dead the exist establishments companies people or insurance life insurance that issuing organized for the are of kinds, ordi contracts and not of insurance various existing purpose of narily thought as for the of ever people. burying thus that the classification It seems dead given perfectly logical they reason is here that does not 8 Article 11 of our Constitution of able. Section only prohibition prohibit of this Sec classifications, that these classifications will is of Constitution tion arbitrary. question On not be unreasonable Bridge long ago 143 Nashville Co., in Scott v. Court said: 223 S.W. 86, 108, Tenn. when has been held this court
“It that classi- challenged, if a statute is made stated in fication any reasonably be facts can conceived that state of the existence facts it, sustain of state of would law be was enacted must assumed. It at the time that one who assails classification also rule showing a statute has contained in the burden any reasonable basis, rest on but essen- it does not * * * tially arbitrary. general publie rule statutes is the their “If unobjectionable, may extend and otherwise character, * particular-classes* *.” to all or confined citizens 558 applies companies or to all
This statute par- single any burial associations alike—it does not out discrimina- one takes them There no ticular but all. particular company suffer The fact tion. that this would pecuniary injury some write loss or because cannot not establish this kind insurance in future does Mayor invalidity. Spoone & its or unreasonableness Aldermen 185 Morristown, Town Tenn. 454, 422. S.W.2d passed
It is Act was likewise contended that this private for the benefit of interests. We of course cannot go question, question into this into motive legislation. enacting is to function Our particular law, declare to determine whether the legislation policy. wise is dictated foolish See quoted heretofore authorities referred to from, Royal well as Jewelers Hake, Co. v. Tenn. 254, . supra 963; S.W.2d Petition Carter, *15 assignment, This think, we likewise merit. without really gotten great haveWe a deal interest out of reading studying this case, the various authorities and the matter and from the excellent briefs filed both days spending doing herein. After sides several we have concluded as hereinbefore stated and for the reasons thus stated decree of the the must Chancellor be affirmed.
On to Rehear Petition appellant, company, The insurance has filed herein a dignified petition courteous, and rather caustic to rehear. They supplemental petition have filed likewise a herein reply and have answered brief of the State. haveWe after times, and several these documents read eacli of hereinafter to doing onr conclusion reached have so stated. praying place filed documents these various the first
In argument no cite and petition new rehear make no to a argument made one The authorities. additional new or legislation enacted that to be made to the Apparently it has complained of Court. not to the and upon existing legis- forgotten attack been that this an opinion again as heretofore re-read our We lation. feel that prepared and down in this case handed and inescapable under therein stated conclusions by this heretofore decided opinions authorities opinion in this as basis cited and which are Court our conclusion. primary ques- petition states that rehear is:
tion Legislature constitutional where acts of “Are regula- unnecessary unreasonable constitute no prohibitions upon with lawful business tions or safety tendency protect public or health, real ’’ ? morals opinion original answer in the It was our Legis- question. think did think We we duty right was their determine lature had the expressed original in our matter for reasons opinion. seem to us it did not In other words unnecessary regulation unreasonable an Act was an attempted prohibition upon which business *16 regulate. stating we as in what did what
Our arguendo Legislature have found was done could they enacting this what show have in mind in could had legislation things they before them and if did have these legislation perfectly it and did then reasonable. was respectfully disagree peti- We with statements of why tioner there was should a no court reas.on speculate Legislature might why as enacted Clearly an act. under the various attacks constitutional legislation duty made on was it our so consider When, Legislature the matter. look an act at under attack made act on this Article 1, Sec- under duty tion 8, it to hold the our act constitutional if it purely arbitrary. is not If the classification some has merely reasonable basis it is because not made with nicety, practice mathematical or because in it results inequality some is not unconstitutional. Motlow v. State, 125 Tenn. 145 S.W. 177, L.R.A., 1916F, 177. Legislature
With the rests determination of the regulations police power reasonableness of under the question court will examine de novo and over judgment by substituting rule such its own, unless it clearly appears regulations “beyond that those are so subject reasonable they all relation to the to which are applied merely arbitrary usurpation to amount to ’ power they unmistakably palpably ’, or are excess legislative power they arbitrary “beyond pos justice” sible if are so of course the de court duty clares them void, otherwise is the of the court to declare the act McKay, constitutional. State v. 137 Tenn. S.W. 99.
Any state reasonably of facts that can be con ceived that would sustain the enacting an act bewill assumed to have existed when the law was en classification, .assailing acted; and one *17 showing rest not does must bear burden law arbitrary. essentially any upon basis, but reasonable State, Motlow v. sufra. paragraph again repeat one must
In conclusion absolutely sound, as original opinion from our which herein. We our conclusion basis for and the it, we see said: only is to deter- matters under such
“Our plausible reason for there is or not mine whether legislation. at is true court enactment of such right pass constitu- on the all times reserves doing in- tionality but so we do statutes Legislature, policy quire is, into the background why if there is did it factual ’’ n Citing legislation. plausible au- of such reason back thorities. petition fully having rehear considered
After may deny A decree it. we must overrule herein accordingly. entered