162 N.W. 373 | S.D. | 1917
The following facts appearing- in the record are material to a question of jurisdiction which is presented on this appeal:
Appellant, defendant in the action, is a corporation existing under the laws of Indiana, with authority to issue contracts of life insurance, and was duly authorized to do business in this state at the date of' the transactions hereinafter referred to. On April 19, 1912, the plaintiff and her husband, Charles Bradley Thomson, were residents of the state of Texas. The defendant corporation having complied with, statutory requirements, was duly authorized to transact the business of life insurance in Texas. On that date the 'defendant company issued in that state its insurance policy in- the sum of $5,000 insuring- the life of Charles Bradley Thomson, and naming plaintiff as 'beneficiary. On August 12, 1912, and while said policy was in force, Charles Bradley Thomson died in the state of Texas. After her husband’s death, .plaintiff -became a resident of the state of Nebraska, and was a resident of that state at the commencement and trial of this action. On February 7, 1911, the defendant company, in compliance with section 13; c. 210, Laws 1909, appointed the insurance commissioner of South Dakota its authorized attorney to accept service of any lawful process against said company with the same legal force and validity as if served on the company; and stipulated that such authority should continue in force “so long as any liability remains outstanding against the company in this state.” Summons and complaint in this action were served' upon the insurance commissioner, in the city of Pierre, on N01-vember t, 1912. On the 22nd of November, defendant served notice on plaintiff’s attorneys, of a special appearance, stating that defendant appeared only for the purpose of objecting to the jurisdiction of' the court. The objection,_ as stated in the notice of appearance. specified: First, that the summons and complaint were served on the insurance commissioner of the state of South Dakota ; second, that the defendant, Meridian Life Insurance Company, was a foreign corporation organized under the laws of the state of Indiana: third, that the plaintiff is not a resident of this
The foregoing facts were made to appear to the trial court by affidavits and the records and files in the action, and are undisputed. An order overruling and denying the objection to jurisdiction was entered' on December 6th, to which order defendant duly excepted, and this ruling is assigned as error. Defendant thereupon answered, alleging: First, false and fraudulent representations and warranties in procuring the policy; second, an accord and satisfaction of plaintiff’s claim in the state of Texas; third, a plea by way of a denial of jurisdiction, in which the facts above stated are set forth.
The question of jurisdiction, as affected by the power of the Legislature to bring foreign corporations within the state for all purposes of jurisdiction, must be determined. It is appellant’s contention that an insurance corporation organized and existing under the laws of ’the state of Indiana, having entered into a contract of insurance in the state of Texas, with a resident of that state, the death of the insured having occurred and the cause of action having arisen in that state, and the plaintiff not being a resident of the state of South Dakota, cannot be brought within the jurisdiction of the courts of this state by service of process upon its duly authorized statutory agent.
The precise question is whether the -statutory consent of a corporation to> be sued in -this state extends to and includes causes of action upon a contract where the contract was entered into in, the cause of action arose in, and the plaintiff is a resident of, a foreign state. This question has not been presented or considered in this jurisdiction. It is conceded that the defendant corporation has, in all things,' complied with the statute, and is transacting business in this state. It is conceded that process was duly sérv’ed upon the insurance commissioner, and we must ássume that he forwarded a copy of such process to the defendant corporation in compliance 'with his duty, under the statute. It is conceded that the defendant, as a foreign corporation, has given the statutory consent to be sued in, and, so far as the statute requires, has
Section 13, c. 210, Laws 1909, relates expressly feo insurance companies, and provides that:
“No foreign insurance company shall, directly 'or indirectly, issue policies, take risks or transact business in this state, until it shall have first appointed, in writing, the commissioner of insurance to be the true and lawful attorney of such company in and for this state, upon whom all lawful processes in any action*576 or proceeding against the company may 'be 'served with the same effect as if the company existed in this state. Said power of attorney shall stipulate and agree, upon the part of the company, that any lawful process against the company which is served on said attorney shall be of the same legal force and validity as if served on the company, and that the authority shall continue in force so long as any liability remains outstanding against the company in this state. A certificate of such appointment, duly certified1 and authenticated, shall be filed in the office of the commissioner, and copies certified by him shall be deemed sufficient evidence, and service upon such attorney shall be deemed sufficient service upon the principal. Whenever any lawful process against any insurance company shall be served upon the commissioner, he shall forthwith forward a copy of the process served on him, by mail, post-paid, and' directed to the secretary of the company; or, in case of companies in foreign countries, to the resident manager in this country; and shall also forward a cop}' thereof to the general agent of said company in this state.”
While this statute does not require that a foreign corporation as a condition, to transacting business in this state shall become a resident of the state, it does require that every foreign insurance company shall stipulate and agree that all lawful process in any action or proceeding against the company in this state may be served upon the commissioner of insurance, “with the same effect as' if the company existed1 in this state,” and that such service “shall be of the same legal force and validity as if served on the company.” It is probably true that the interpretation of such statutes, since the Fourteenth Amendment to the federal Constitution, may be subject to review by the federal courts, and in view of utterances of the Supreme Court of the United States may not be free from doubt. In Simon v. South. R. Co. 236 U. S. 116, 35 Sup. Ct. 255, 59 L. Ed. 492, deckled in January, 1913, Justice Lamar says:
“But this power to designate by statute the officer upon whom service in suits against foreign corporations may be made relates to business and transactions within the juris fiction of the state enacting the law. Otherwise, claims on contracts wherever made and suits-for torts wherever committed might by virtue of such compulsory statute be drawn to the jurisdiction of any*577 state in which the foreign corporation might at any time be carrying on business. The manifest inconvenience and' hardship arising from such extra territorial extension of jurisdiction, by virtue of the power to make such compulsory appointments, could not defeat the power if in law it could be rightfully exerted. But these possible inconveniences serve to emphasize the importance of the principle laid down in Old Wayne Mutual Life Ins. Co. v. McDonough, 204 U. S. 22, 27 Sup. Ct. 236, 51 L. Ed. 351, that the statutory consent of' a foreign corporation to be sued does not extend to causes of action arising in other states.”
It is suggested that the language of Justice Lamar was ob-iter dictum, but it can hardly be doubted that it expresses the views of that eminent jurist, and it apparently stands without dissent or criticism by 'his associates. It may also be noted that this is the most recent utterance of that court and subsequent to the decision in Barrow S. S. Co. v. Kane, 170 U. S. 100, 18 Sup. Ct. 526, 42 L. Ed. 964, which appears to be the case relied upon by the learned annotater of the case of Pinney v. Providence Loan & Investment Co. as authority for the proposition that where the jurisdiction is not limited to business done within the state, either by the statutory provision relating to the mode of service of process, or those relating to the jurisdiction of the subject-matter, an action may be maintained against the corporation, either in the federal or state courts, on a cause of action not arising out of the busines transacted within the state. The views of Justice Lamar appear to have been adopted in Fry v. Denver & R. G. Ry. Co. (D. C.) 226 Fed. 893. But it seems to be the general policy of our law to place individuals and foreign corporations -coming into this state upon the same basis, so far as the right to sue them is concerned, and it is our ditty to give effect to that intent until the federal courts shall affirm or deny the constitutionality of such legislation.
Section 885 of the Civil Code, the general law with reference to foreign corporations, provides that service of process may be made upon the duly authorized agent in any action in which said corporation may be a party. Subdivision 2, § no, Code Civ. Proc., in relation to the service of summons, provides:
“But such service can be made in respect to a foreign corporation only when it has property in this state, or the cause of*578 action arose therein, or when such service shall be made within this state personally upon the * * * duly authorized agent thereof.”
And that:
“Service made in any of the modes provided in this section shall be taken and held to be personal service.”
We are 'also inclined to. the view that the Legislature intended (section 13, c. 210, Laws 1909) to cover transitory actions accruing in another jurisdiction in favor of nonresidents, and that service may be made upon foreign, insurance corporations, under that section, with the same effect as if the company existed in this state, and that:
“The weight of modern authority * * * seems to support the proposition that a modern corporation may be sued on a transitory cause- of action in any jurisdiction where it can be found in the sense that service may be perfected upon an agent or officer transacting business for the corporation within that jurisdiction, and that in the absence of statutory provisions to the contrary, the residence of the plaintiff and the place at which the cause of action arose are not material questions to be determined to maintain jurisdiction if the corporation can be found and served.” 12 R. C. L. § 91; Abbeville, etc., v. Western, etc., Co., 61 S. C. 361, 39 S. E. 559, 55 L. R. A. 146, 85 Am. St Rep. 890, note IV, p. 921.
The defendant alleges as an affirmative defense, in paragraphs 5, 6, and 7 of the answer, that the insured in his application falsely and fraudulently represented to the defendant that he had never used spirituous or malt liquors freely or to excess, and that he did not use to exceed two glasés of malt liquors daily, and that he did not use any spirituous liquors; that said representations were false and fraudulent, and were made with intent to induce defendant to accept such application and issue said policy of insurance; and that he did use spirituous and malt liquors freely and to excess, up to the time of his death, and that the use of such liquors contributed to and was miore or less the cause of his death.
At the close of plaintiff's evidence, and again at the close of all the evidence, defendant moved for a directed verdict specifying the particulars in which the evidence is alleged to be insufficient. We find it unnecessary to recapitulate or determine the sufficiency of the evidence to sustain the first defense pleaded. But we have examined1 with much care the entire evidence in the record relating to that defense, viz. fraud in the inception of the policy, and are convinced that the defense was meritorious, and such as appellant might properly, and in good faith interpose. It is, however, unnecessary to make further reference to that portion of the evidence, though we deem it proper to recapitulate briefly portions of the evidence which have a direct bearing upon the defense of accord and satisfaction, a consideration of which is decisive of this appeal. As to this defense it is necessary to consider the evidence in its bearing upon the bona fides of the accord and satisfaction in view of plaintiff’s claim that she was induced to make settlement by means of false, fraudulent, and coercive representations by the agent of the' defendant company. The evidence discloses that subsequent to the death of Thomson the company received information as to his habits and the probable cause of his death, which caused it to direct its attorney,' Mr.Weaver, to see the plaintiff, and' to make certain investigations as, to false and fraudulent representations by' deceased in procuring the policy- Mr. Weaver had an interview with the plaintiff at her home on the igth of September. With reference to this interview, the plaintiff herself testified as follows:
*579 “Q. You may tell what was said by him [Weaver], if anything, with reference to the-claim that the company had a defensé, or that the company was not liable, if he said anything. A. Yes.' Q. Tell, as particularly as you can, what he said. If you cannot
“If that is all you have to offer, I will have nothing to do with the settlement. She can do as she likes.”
That Mr. Weaver said he had been around to see a number of people in Houston, and -had' learned from them that Mr. Thomson had drank to excess. That this was about 2 o’clock in the afternoon; and after making this offer, Mr. Bigger and Mr. Weaver went away and left -her in Mr. Fuqua’s office. That Mr. Bigger went back and forth from where-Mr. Weaver was to Mr. Fuqua’s office, and through him the offer of settlement was raised from' time to time, during the afternoon up- to $1,500, then finally to $2,000, and then that evening about dark Mr. Weaver finally agreed to give the $2,500. That Mr. Weaver told her, in substance, that the company wanted to- be absolutely fair to its policy holders, and was willing to make that settlement, although they were not liable, and that Fuqua said to Weaver that even though he had evidence to prove that her husband drank to excess, still he ought to waive that aside and agree to pay half. That when evening came and1 Mr. Weaver met her again at Mr. Fuqua’s
“Houston, Texas, September 20, 1912.
“Received of the Meridian Rife Insurance Company, Indianapolis, Indiana, nine hundred fifty and no-ioo dollars ($950.00) in partial payment of the sum of twenty-five hundred dollars, in consideration of which and the payment of the remainder of said last named sum, I hereby agree shall be and hereby is -in full payment of all claims due me as beneficiary under life insurance policy number J18398 of said insurance company issued on the life of Charles Bradley Thomson, dated April 12, 1912.
(Mrs.) Clara Belle Thomson.”
Witness further testified: That she had the insurance policy with her at the -time of this settlement, and receipted and surrendered the policy. That she - was paid $950 cash. That Mr. Wreaver drew a -draft for $1,550, and she s-igned it, and that next day she and Mr. Fuqua took the draft to the bank with the receipted policy attached, and instructed the bank to deliver the policy to the company when the draft was paid, and that the company paid the draft, and the policy was surrendered.
Mr. Weaver testified, in substance: That when the company received the proof of death, it showed- that the insured had died of paralysis. That he was 40 or 41 years of age. That the policy was issued in April, 1912, and he was dead in August, after paying one premium. That these facts led the company to believe there was something wrong with the insured when he took out the insurance that' he had not mentioned in his application, and that the company began an investigation. That on his way he stopped at Houston, and found where Mr: Thomson lived, and whére- he had lived at various times. That he went to- some people who knew him- -during his lifetime. That he talked with a woman in whose house Mr. and Mrs. Thomson had lived for some time, and was informed that Thomson was in the hábit of getting, intoxicated, and had been during the year he took out the insurance. That he talked with various people, and heard, that
A full and careful examination of the entire record and the evidence convinces us that the evidence is not sufficient to sustain respondent's contention that the written accord and satisfaction of 'her claim against the ’defendant company was obtained by fraud, misrepresentation, or coercion, and that the trial court erred in not sustaining appellant's motion for a -directed verdict at the close of all the evidence.
The order and judgment of the trial court are therefore reversed.