154 N.Y.S. 472 | N.Y. App. Div. | 1915

Hotchkiss, J.:

Plaintiff sues to recover commissions alleged to have been earned by him in placing insurance with the defendant company. The defense demurred to alleges that the plaintiff had no license, as prescribed by section 91 of the Insurance Law, to act as agent. This section provides that no life insurance company doing business in this State shall pay to any person any commission for services in obtaining new insurance unless such person has procured a certificate of authority to act as agent of such company as in the section provided, and that no person shall act as agent or receive any commission for services in obtaining new insurance for such life insurance company without procuring such a certificate. The section further provides in part as follows: Such certificate shall be issued by the Superintendent of Insurance only upon the written application of persons desiring such authority, such application being approved and countersigned by the company such person desires to represent, and shall be upon a form approved by the Superintendent of Insurance, giving such information as he may require. The Superintendent of Insurance shall have the right to refuse to issue or renew any such certificate in his discretion.” (Consol. Laws, chap. 28 [Laws of 1909, chap. 33], § 91, as amd. by Laws of 1909, chap. 301.) The section was held unconstitutional by the court below (90 Misc. Rep. 129) on the ground that it vests in the Superintendent an unrestricted discretion to grant or withhold a license at his pleasure, unregulated by any common standards of qualification or conditions whatsoever, and thus vests arbitrary power in the Superintendent to prevent any person from pursuing a *219lawful calling. The right of every person to pursue any lawful business or calling is, of course, subject to the paramount right of the State to impose such restrictions and regula-tions as the protection of the public may require. (People ex rel. Armstrong v. Warden, etc., 183 N. Y. 223.) This power must be exercised, however, in conformity with the constitutional requirement that the restrictions imposed must operate equally upon all persons pursuing or seeking to pursue such calling or occupation, under the same circumstances. In Hauser v. North British & Mercantile Ins. Co. (152 App. Div. 91; affd., 206 N. Y. 455) it was held that the Legislature has the right to regulate the business of soliciting fire insurance and to require that those seeking to engage therein shall first secure a license from the State authorities, although it was held in the same case that the section of the statute then under consideration was void in that it undertook to limit the right to engage in the business of fire insurance agent or broker to such persons as intended to carry on such business as their principal occupation or in connection with a real estate business. It is not contended that the business of soliciting life insurance is, inherently, to be distinguished from that of soliciting fire insurance, and the two businesses were classed together by Mr. Justice Miller, who wrote for this court in the Hauser Case (152 App. Div. 93). I think the vice of the respondent’s position lies in the assumption that the statute is not susceptible of any construction save one which would make it unconstitutional. It is well settled that if a statute is susceptible of two constructions, by one of which it would be unconstitutional and by the other valid, the latter construction should be adopted rather than the former. (People ex rel. Nechamcus v. Warden, etc., 144 N. Y. 529; People ex rel. Lieberman v. Van De Carr, 199 U. S. 552.) We may not presume, therefore, in the absence of language indicating a contrary intent, that the Legislature intended to grant to the Superintendent of Insurance unrestricted power or unregulated discretion, or that in refusing a certificate he will act arbitrarily or oppressively.

I think the principles announced in many cases, but nowhere more decisively than in People ex rel. Lieberman v. Van De *220Carr (supra), are controlling. That case involved section 66 of the Sanitary Code of the city of New York, as it then existed, which provided that “no milk shall be received, held, kept, offered for sale, or delivered in the City of New York without a permit in writing from the Board of Health and subject to the conditions thereof. ” The section was attacked on substantially the same grounds as are urged to defeat the section of the Insurance Law now under consideration. The decision of this court (81 App. Div. 128) holding the act to be constitutional was affirmed by the Court of Appeals (175 N. Y. 440), and by the Supreme Court of the United States, where the opinion of Mr. Justice Day cited with approval a portion of the opinion of this court, the gist of which was that in cases where the State has the power to regulate a business or occupation it may confer discretionary power upon administrative boards to grant or to withhold permission to carry on such business or occupation, and that there is no presumption that a power so granted will be arbitrarily or improperly exercised. (See, also, Village of Saratoga Springs v. Saratoga Gas, etc., Co., 191 N. Y. 123.) In case it should be, the law will afford relief to the injured person. (People ex rel. Lodes v. Dept. of Health, 189 N. Y. 187.) Furthermore, the express terms of the section in question leave no basis for the claim that the Superintendent is given arbitrary or capricious power, or that he should not act under regulations and conditions applicable to all alike. The language used is: “ Such certificate shall be issued by the Superintendent of Insurance only upon the written application of persons desiring such authority, such application being approved and countersigned by the company * * * and shall be upon a form approved by the Superintendent of Insurance, giving such information as he may require.” Then follows the clause: “ The Superintendent * * * shall have the right to refuse to issue or renew any such certificate in his discretion. ” The requirement that the applicant shall have first secured the approval of the company he seeks to represent is manifestly proper and is one step toward the adoption of a uniform system. The further provision that the application shall be “upon a form ” approved by the Superintendent, which form shall give him “ such information as he may require ” clearly contem*221plates the adoption of a common standard for all applicants, but retaining in the Superintendent, according to the provision last quoted, authority to determine whether the applicant conforms thereto.

The order sustaining the demurrer should be reversed, with ten dollars costs and disbursements, and the motion denied, with ten dollars costs, with leave to plaintiff to withdraw demurrer on payment of costs.

Ingraham, P. J., Clarice, Scott and Dowling, JJ., concurred.

Order reversed, with ten dollars costs and disbursements, and motion denied, with ten dollars costs, with leave to plaintiff to withdraw demurrer on payment of costs in this court and in the court below.

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