99 Tenn. 322 | Tenn. | 1897
The complainant is a corporation organized under the laws of the State of Connecticut to carry on a life insurance business, and has its principal situs in Hartford, in that State. For many years prior, to the year 1894, it actively prosecuted its work in the State of Tennessee, soliciting applications for life insurance and issuing policies upon such applications as were approved by its officers. In the year 1889, and afterwards in 1893, an agent of this company was in the State of Tennessee, and, by his solicitations, induced one B. R. Spratley, a citizen of this State, to apply for insurance on his own life, and upon these applications the complainant
In the year 1896, B. B. Spratley died, and proof of his death was forwarded to the company. Very soon thereafter complainant sent O. N. Chaffee, one of its employes, into the State to investigate this claim, and the conditions under which this 'death occurred. He came, and had interviews with the beneficiary, Mrs. Spratley, her brother, and other parties, of all of which he made report to his home company. Upon receiving this report, the complainant, through its vice president, wired the agent as follows: “We think case” (referring to Spratley’s death claim), ‘'should be settled for reserves or thereabouts.” After receiving this telegram, Chaffee visited Mrs. Spratley, and submitted an offer to settle on the terms indicated in it; this offer, however, was rejected. While in this State on the business and occasion referred to, suit was instituted by the beneficiary against the insurance company for the amount alleged to be due' on these policies, in the Circuit Court of Shelby County, and process was served on Chaffee, as the agent of the company. At the same time all the requirements of Chapter 226 of the Session Acts of 1887, with regard to the giving other and further notice of the bringing and pendency of this suit, were complied with.
Sections 2831-2834 of the Code (M. & V.), corresponding with §§ 4539-4542 of Shannon’s new code,
In Telephone Co. v. Turner, 4 Pickle, 265, it is held that this Act did not apply to any foreign corporation having resident agents in the county where the suit is brought, but that the case presented in this record is one within its provisions, we think is clear. The question is, is it constitutional ?
It may be said that in this legislation Tennessee is only following in the footsteps of many other States of the Union. So diversified and widespread have been the operations of corporations, that possibly every State has, for the protection of its own citizens, found it necessary to adopt similar laws. In Lafayette Ins. Co. v. French, 18 Howard, 404, with regard to a judgment obtained in a Court of Ohio against an Indiana corporation, in a suit where service was had on a resident agent in Ohio, the Supreme Court of the United States said: “It cannot be deemed unreasonable that the State of Ohio should endeavor to secure to its citizens a remedy in their domestic forum upon this important class of contracts, made and to be performed within that State, and fully subject to its laws; nor that proper means should be used to compel foreign corporations transacting their business of insurance within the
For a long period it has been settled that a corporation created in one State has no right, under the Constitution of the United States, to transact business in another State, save by the consent, express or implied, of that State, and this consent may be given on such terms as the State may see proper to impose, and the terms so imposed are binding on the corporation. Paul v. Virginia, 8 Wall., 168. The only limitation upon this right is that the conditions imposed must not be repugnant to the Constitution or laws of the United States, or to “that principle of natural justice which forbids condemnation without opportunity for defense.” Lafayette Ins. Co. v. French, supra. So that if “a State permits a foreign corporation to do business within her limits, and at the same time provides that in suits against it for business there done, process shall be served upon its agent, the provision is to be deemed a condition of the permission; and corporations that subsequently do business in the State are to be deemed to assent to such condition, as fully as though they had specially authorized their agent to waive service of process.” St. Clair v. Cox, 106 U. S., 350. Continuing in that case, the Court said: “Such condition must not, however, encroach upon that principle of natural justice which requires notice of a
As illustrating the length to which the Courts have gone in subjecting foreign corporations to actions or demands which arise in the State of the forum, by service of process on some representative within its territorial limits, the cases of Coleman Iron Works v. Mining Co., 15 Col., 433, Sheckle v. Construction Co., 61 Mich., 226, and Pope v. Terre Haute Car Mfg. Co., 87 N. Y., 137, may be referred to. These cases carry the doctrine of representation far beyond the case presented in this record, and much beyond what is required of us in order to sustain the judgment here complained of. In Pope v. Terre Haute Car Mfg. Co., supra, the foreign corporation, in a suit by a citizen of New York, on a demand growing out of a transaction in that State, was brought into Court by service on its president, who was passing through to a seaside resort, and was in no sense there in his official capacity, or upon any business connected with his corporation, and yet it was held that this .service would sustain a judgment against the corporation. While not feeling it necessary to agree to the conclusion reached, yet, the following paragraph, taken from the opinion in that case, does meet with our approval: “The object of all service of process for the commencement of a suit, or any other legal proceeding, is to
Mr. Murfree, in his recent work on Corporations, in Sec. 215, after speaking of the great variety among the statutory provisions for bringing foreign corporations into the home forum, says: “The purpose of such provisions being to insure the giving of due notice to the corporation, that idea is given prominence in all the decisions interpreting them. Consequently, the general rule ... is that if the person served sustain sufficient character and rank to render it reasonably certain that the corporation would be apprised of the service, the requirement of the statute is answered;” and it may be added that the demand of natural justice will be thereby satisfied. Perhaps no better statement of the doc
It will not be assumed by this Court that in the
But it is argued that the Act of 1887 did not apply to this corporation, because it had filed, under the requirements of Ch. 66 of the Acts of 1875, Sec. 12, an irrevocable power of attorney authorizing the Secretary of Slate to accept service. To this it may be said (1) that this agreement is in the teeth of complainant’s bill, in which it alleges that it was a nonresident of this State and had no office or agent in Tennessee, or had not had for some years preceding the institution of the suit on the policies, thus, by implication at least, negativing its present proposition. (2) But, as a mattter of law, is the contention sound? The legislation on this subject is as follows: Chapter 23 of the Acts of 1873, Sec. 2, required foreign fire insurance companies to file with the Treasurer of the State a written instrument authorizing any agent of such company in the State to acknowledge service of process; and Ch. 66 of the Acts of 1875, Sec. 12, required foreign life insurance companies to file with the Insurance Commissioner a power of attorney authorizing the Secretary of State to accept service. Chapter 23 of the Acts of 1873 was repealed by Ch. 47 of the Acts
The suit brought by Mrs. Lynda Y. Spratley in the Circuit Court was instituted on the fifteenth day of April, 1896. Chapter 160 of the Acts of 1895, repealing Ch. 66 of the Acts of 1875, in Sec. 9, contains a provision requiring every foreign insurance company, fire or life, as a prerequisite to admission into the State for the transaction of business, to constitute the Insurance Commissioner its attorney to accept service. It is not claimed that the complainant company had acted in accordance with this provision.
From July 1, 1894, down .to the time the suit in the Circuit Court was brought, complainant company was doing a limited business .in Tennessee. It had a large number of policies in the State, from which it collected its premiums at stated periods; and when a death occurred, it sent its agent into the State to make the necessary investigation and report upon the circumstances under which the injured party died, as was done in this particular case. Ordinarily, the rule is that where civil proceedings, or jurisdiction in civil cases, depend upon a statute, they fall with the repeal of that statute. Endlich on lnt. of Stats., Sec. 479. Many illustrations of this rule will be found in the cases, among which are State v. Brookam, 22 W. Va., 214; Stephenson
But we cannot accede to the proposition that, by complying with the Act of 1875, by the execution of its power of attorney to the Secretary of State, that complainant thereby made a contract with the State of Tennessee, which is protected by the contract provision of the Constitution of the United States, and that no subsequent legislation can make this corporation amenable to action in the Courts of the State by service of process on any other agent. We are unable to discover any element of a contract which precluded the State thereafter from adopting legislation which contemplated bringing this corporation into our Courts by service on such other agents as reasonably represented it and were found carrying on its business within our territorial limits. If the argument of complainant’s counsel on this point is sound, then, if the office of Secretary of State should be abolished, this result being the act of the State, for which complainant would in nowise be responsible, then our citizens could obtain no redress for their grievances sustained- at the hand of this company, in their domestic Courts, even if there was an agent with full power of representation residing in each county of the State. A position from which such a conclusion may be deduced, we think necessarily unsound.
We deem the Act of 1875, in this regard, as
The decree of the Chancellor is reversed, and a decree will be entered against complainant and the surety on its injunction bond for the amount of the judgment of the Circuit Court and interest upon it and all cost of the two Courts.