12 Or. 40 | Or. | 1885
Lead Opinion
This was an action upon a promissory note made at Seattle, Washington Territory, to one A. B. Covalt, and assigned after due to tbe plaintiff.
Tbe defense set lip is that the note was made in payment of a premium on a life insurance held by tbe defendant Tesler in a Kansas life insurance company; that tbe company bad an agent at Seattle, Washington Territory, who solicited tbe insurance in January, 1876, and tbe note in question was given in August, 1876, at Seattle, in payment of tbe second semi-annual premium on tbe policy, and that the note was void, for tbe reason that tbe said insurance company was a foreign insurance company, and bad not complied with tbe laws of Washington Territory in regard to foreign insurance companies doing business in tbe Territory.
It appears by tbe bill of exceptions that tbe said Covalt, mentioned in tbe note, and one Guión, were agents of Alliance Mutual Life Assurance Society, a corporation organized and existing under tbe laws of tbe State of Kansas, and were engaged in soliciting life insurance for said company at Seattle, Washington Territory, and in making and taking applications therefor, and in 'collecting and receipting for premiums thereon. That in January, 1876, at Seattle, in said Territory, tbe said Guión, as agent of said company, received tbe application of the defend
Upon this state of facts the court below instructed the jury that the taking of this note was doing insurance business within the Territory, and the result was a verdict and judgment for the defendant.
The contention of the plaintiff is that the taking of a promissory note in payment of a premium on an insurance policy is not “ doing insurance business.^ Upon tké facts as presented by this record, it would seem tjhat the agent was not authorized to make a binding contract of insurance. As between him and the company, he was empowered to solicit and receive applications for insurance, and receipt for the premium money therefor, and to-forward them to the company for their approval or rejection.
In Armstrong v. State Ins. Co. 61 Iowa, 215, it was held that the agent of an insurance company, who was authorized to take applications for insurance, and receive and receipt for premiums, and forward applications and premiums, and receive from the company policies of insurance when issued, and deliver them to
When the defendant Yesler presented and delivered his application, and the premium money therefor, to the agent, to be by him forwarded to the company for its acceptance or rejection, he knew and understood no policy of insurance would be issued unless the company accepted his application. Nor was any contract consummated until the application was accepted, and the policy duly issued.
The final act which made the transaction a binding contract upon the parties was the acceptance of the application. Until this took place it was a mere proposition tendered, to be accepted or rejected. The contract was consummated when the company acted upon the proposal and issued the policy, for then the minds of the parties had met and agreed. “What was before,” says Harris, J., “a mere proposition, then became invested with the attributes of a contract, and from that time each party became bound for its performance. If this be so, the contracts are to be regarded as having been made when the company received and accepted the defendant’s application, and issued and transmitted to him their policies.” (Hyde v. Goodnow, 3 N. Y. 270.) It was, therefore, a contract of insurance made and executed in Kansas. (Lamb v. Bowser, 7 Biss. 373; Lamb v. Bowser, 7 Biss. 315; Western v. Genesee M. Ins. Co. 12 N. Y. 261; Tayloe v. Merchants’ F. Ins. Co. 9 How. 400.)
Thus far the case stands clear. When the second annual premium became due on the policy of insurance, the agent called upon the defendant Yesler for its payment, and in lieu thereof, and under the circumstances already indicated, accepted the note in question. And the inquiry now arises whether the taking of the note was doing business in the Territory. To undertake to give an exact definition to the word “ business,” which could be applied as a test or criterion in every case, would
The company was prohibited from doing business ip the Territory without compliance with its laws. This it had not done. It had effected an insurance, issued its policy, and the semiannual premium was due. Was the taking of the note in question by the agent in payment of this premium the doing business in the Territory? Was it a transaction which signifies the doing of business? Tested by the judicial interpretation applied to these statutes, the taking of the note was the making of a contract, which signifies the doing of business, and is within the prohibition of the law.
“When the legislature prohibits an act/’ says Mr. Justice "Walker, “ or declares that it shall be unlawful to perform it, every rule of interpretation must say that the legislature intended to interpose its power to prevent the act, and as one of the means of prevention that the courts shall hold it void. This is as manifest as if the statute had declared that it should be void. To hold otherwise would be to give to the person or corporation or individual the same right in enforcing prohibited.
As the note was transferred after it was due, it was open to the defense alleged, which in our judgment is well sustained. There was no error, and the judgment must be affirmed.
Dissenting Opinion
dissenting.—- When this case was argued I was very much inclined to the opinion that soliciting and receiving applications for insurance in Washington Territory by an agent of a foreign insurance company, and forwarding them from there to the company, although the agent had no authority beyond the right to forward such applications to be examined and passed upon at the home office, would constitute the doing an insurance business within said Territory, and be in violation of its statutes, unless complied with by the company; but the-authorities collected by his honor, Judge Lord, and referred to in the opinion prepared by him in this ease, have changed my preconceived notions upon the subject, and I concur in that opinion to the extent that the insurance upon the life of Yesler by the Alliance Mutual Life Assurance Society was, as a matter of law, effected at the home office of said company, in the State of Kansas, notwithstanding the application therefor was solicited by the agent Covalt, in Washington Territory, was made there, and forwarded by said agent from there. But I am not able to concur in the opinion that the taking the note sued on for a premium, when the insurance was lawfully effected, was doing business within the meaning of the law of Washington Territory. Nor, under the circumstances suggested, do I believe that the legislature of that Territory intended, or could rightfully pass a statute that would render such an act unlawful. If the insurance was lawful, and the premium notes executed by Yesler
If Yesler had been residing in Kansas when the insurance was effected upon his life, and had personally made the application therefor at the home office of the company, had executed the premium notes there, received the policy there, and then emigrated from that State to "Washington Territory, it could not be doubted but that the company, as a matter of course, would have had the right to forward those notes, and collect them of him at their maturity. And the right of the company stands upon the same footing in this case as it would have stood in the case supposed,, and it would no more be doing business, within the meaning of the laws of Washington Territory, in the one case than in the other.
Yesler owed the company a lawful debt, and how could a territorial or State law be construed consistently so as to prevent its collection? If Yesler had been in possession of the tangible property of the company, and it had attempted to recover it from him in Washington Territory, would not that have been doing business there, just as much as its attempt to recover from him its chose in action would have been? In either case, it would have been an effort to obtain from him that which belonged to it legally, and I do not see how such an endeavor could be adjudged a violation of law.
The Washington Territory law certainly only intends that a foreign life insurance company shall not, except under the conditions it imposes, do its insurance business there. It would, to my mind, be unreasonable to suppose that any company of that character could not enforce a payment of lawful obligations due to it without any compliance with such conditions, and an action instituted in its courts would be doing business as much as receiving a promissory note from a debtor.
If an officer intrusted with the funds of the Alliance Company, .at its home office in Kansas City, should run off with them, in violation of his trust, to Washington Territory, could not the company cause his arrest upon civil process, or receive
“That all corporations now existing or hereafter formed under the laAvs of the States, etc., shall have full power and authority to sue and be sued, hold, purchase, and acquire, sell, lease,, and dispose of, real and personal property, and generally to do and perform any and every act, and transact business within this-Territory in the same manner and to the same extent as though said corporation had been organized under the laws of this Territory; provided, that any such corporation hereafter acquiring property or commencing to transact business in this Territory shall first comply with the provisions of section 2 of this act.”
The proviso, it will be seen, only extends to “acquiring property,” and “commencing to transact business.” Taking the note was not “ acquiring property,” as it was but a novation of a debt; nor was it the “commencing to transact business” Avithin the meaning of the statute.
If the act had provided that no foreign lawyer should practice his profession in that Territory without having first been admitted to its courts, it would not extend to the collection of a fee there, earned somewhere else; or that no foreign merchant should carry on business there without a license, surely a merchant at Portland could sell a bill of goods to a Washington Territory citizen at Portland and send over his claim for collection without such a license. The territorial statute may be a wholesome provision of law, but I am at loss to understand why it should have such a latitudinarian construction as is attempted to be given it. The construction, doubtless, will
In my opinion, if such a law existed, it would be “more honored in its breach than in its observance.” I am in favor of a reversal of the judgment. «