Fire Department v. Noble

3 E.D. Smith 440 | New York Court of Common Pleas | 1854

By the Court. Ingraham, First J.

This action is brought against the defendants upon a bond given under the statute in relation to insurances made by individuals and associations unauthorized by law, conditioned that Noble would render a true account of the premiums received for such insurances, and pay two per cent, on such premiums to the treasurer of the plaintiffs.

The defendants demur to the complaint upon the ground that the complaint does not state a sufficient cause of action, that the act of the legislature under which the bond was given is unconstitutional, in violation of the constitution of the United States and of the state of New York.

The demurrer was overruled at special term, and judgment entered for the plaintiffs, from which the defendants appeal.

The objections to the validity of the act are founded on the constitution of the United States and of the state of New York.

It is contended, first, that the act is unconstitutional, because it makes a discrimination between the citizens of this state and those of other states, and is in contravention of that provision which secures to the citizens of each state the rights and immunities of those of other states. (Constitution of the United States, art. 4, § 2, subd. 1.)

An examination of the statute under which the bond was given will at once show that this objection is without foundation. The operation of the article is not confined to foreign corporations or individuals of other states.

The several statutes may be found at 1 R. S. 714. (Sess. Laws of 1837, p. 21, and Sess. Laws of 1849, p. 239). These statutes apply equally to the citizens of this state as of others, to insurers in this state as well as in others, in fact to everybody who acts as agent, for any individual or corporation in effecting insurance, except for corporations organized under the laws of this state.

The effect of these statutes is to prohibit the agency of citizens of this state, as well as of other states; and it operates more upon citizens of this state if, as is generally the case, the agent is a citizen of the state where he resides.

It was conceded on the argument that the state might prohibit foreign corporations from bringing actions in our courts. That concession yields the whole point in this objection. If a distinction can- be made between foreign corporations and those of this state as to bringing actions, surely a like distinction may be made as to their doing business in the state, and as to the appointment of agents in the state. A contrary rule would deprive the state of the power to prohibit the circulation of bills of foreign banks, while they permit banks created by their laws to pass their bills, and would interfere with many important powers now exercised by the state legislatures.

It is euough, however, to say that there is nothing local in these acts. They apply to agents, whether citizens of this state or others, and they relate to insurances, whether made by citizens of New York or citizens of other states, and to corporations created by other states, whether the stockholders were citizens of this state or other states.

The second ground of demurrer arises under the constitution of the United States and under the constitution of the state of New York. The statute of 1849 gives the premium so to be paid by agents of insurers, to the Eire Department of the city of New York.

This is said to be a violation of the provision which regulates the taking of private property, and it is urged that the law is void because it makes the tax payable to the plaintiffs.

The laying of a tax or requiring a license fee to be paid can never be considered as taking private property in the sense used in the constitution. It is a charge for the privilege of doing an act which the party assessed is not under any obligation to do, and the omission to do which will relieve him from the obligation to pay the charge.

This is no compulsory taking of private property.

The same might be said of all local taxes which are collected and paid to the counties or towns, and not to the state at large, and might with much more propriety be applied to taxes raised for special purposes of charity under local acts and confined to specified districts.

It has always been conceded that the legislature has the power to apply moneys raised, either by tax or otherwise, to purposes of charity. There can be no doubt that the plaintiffs are the representatives of a public charity well worthy of support, and entitled to the favor of the public, even if it cannot be said of it that such an appropriation is the applying of moneys to the public use.

If the tax may be imposed for the benefit of the department, I see no reason why it may not be payable at once to them instead of passing through the state treasury for that purpose.

The passenger act furnishes an illustration of similar legislation, and there are on the statute books many acts in which a fee for license or a penalty for a violation of law is made payable directly to the body to which it is to be applied, and they are authorized to maintain an action therefor.

That the legislature may regulate insurance in this state; that they may designate who may make insurance; that they may prohibit agencies except upon certain conditions; that they may impose as such condition the payment of an annual tax to a charitable department of the city government, and authorize such- department to collect the same,- appear to me powers within the authority of the legislature, and the exercise of such power in nowise interferes with the provisions either of the United States or state constitution.

Neither of the grounds of the demurrer are well taken. The judgment of special term should be affirmed.

Judgment affirmed.