Supreme Court of Connecticut, 1891

American Casualty Insurance & Security Co. v. Fyler

Supreme Court of Connecticut · Decided May 26, 1891 · Andrews, Loomis, Seymour, Torrance, Hall

22 A. 494; 60 Conn. 448

Counsel

W. F. Henney and A. L. Shipman, for the appellants. 1. A corporation organized under the laws of one state may conduct its business in another, subject only to the restrictions of local law. This is the law of comity, and the rights conferred by it are absolute. People v. Fire Asso. of Philadelphia, 92 N. York, 311; Merrick v. Van Santvoord, 34 id., 208; Bard v. Poole, 12 id., 495; Bank of Augusta v. Earle, 13 Pet., 519; Cowell v. Colorado Springs Co., 100 U. S. R., 55 ; State v. Fidelity Casualty Ins. Co., 39 Minn., 538 . 2. The local restrictions upon a foreign corporation seeking to do business in a state must be affirmatively expressed in the local law. "If the policy of the state or territory does not permit the business of the foreign corporation in its limits, it must be expressed in some affirmative way; it cannot be inferred from the fact that its legislature has made no provision for the formation of similar corporations, or allows corporations to be formed only by general law." Cowell v. Col. Springs Co., supra. 3. The policy of the state in this regard must be evidenced by its statutes on that subject. "When the state does not forbid, or its public policy, as evidenced by its statutes, is not infringed, a foreign corporation may transact business within its boundaries, and be entitled to the protection of its laws." People v. Fire Asso. of Philadelphia, supra. 4. There is nothing in the laws of Connecticut, upon the admitted facts set up in the motion for a mandamus, which forbids the applicant company to transact its business here. In Am. Foreign Christian Union v. Yount, 101 U. S. R., 352 , the court said, after citing Cowell v. Colorado Springs Co. with approval: — "In harmony with the general law of comity obtaining among the states composing the Union, the presumption should be indulged that a corporation of one state, not forbidden by the law of its being, may exercise within any other state the general powers conferred by its own charter, unless it is prohibited from so doing, either in the direct enactments of the latter state, or by its public policy to be deduced from the general course of legislation or from the settled adjudications of its highest court." 5. The company's right to admission by the express terms of the statute depends upon the fact of compliance with statutory requirements and laws, and not at all upon a finding by the commissioner to that effect. The commissioner's powers and duties are fully stated and limited in one comprehensive phrase in the statutes: — "The insurance commissioner shall see that all the laws respecting insurance companies are faithfully executed." Gen. Statutes, § 2820. The marginal note entitles this section, "Powers and Duties of Insurance Commissioner." It is clear, therefore, that he is not to make new laws, or establish a new state policy, or set up new standards of solvency, or to do aught else but to see that the laws as he finds them are enforced. People v. Bell, 119 N. York, 175; Daly v. Dimock, 55 Conn., 579 . The powers thus conferred differ radically from the powers given the Kansas insurance commissioner, on which the case of Dwelling House Ins. Co. v. Wilder, 40 Kansas, 561, turns. His function is to find facts, and he has "the sole and exclusive charge and control over said insurance department." There are undoubtedly matters with regard to which the insurance commissioner is vested with discretion by our statutes. He may examine into the methods of insurance companies, and may require them to discontinue illegal and improper methods of doing business. This power is given him over any kind of insurance business, but it must be exercised subsequent to the admission to do business in Connecticut. (§ 2224.) His action in such cases, however, can be reviewed by the Superior Court. (§ 2823.) There are numerous sections in our statute with regard to insurance, but none of the others have any application whatever to the case of a foreign insurance company asking admission into this state. To say that the admission of the applicant company depends upon the finding of the commissioner of the fact of its compliance with the laws, and not upon such compliance, would open the door to the perpetration of the greatest injustice and construe our insurance law into an absurdity. Such a construction would not only violate the plain provisions of the statute, but would be at war with the well-considered decisions of the most intelligent courts of the land. By that construction our courts would be ousted of jurisdiction to construe insurance statutes governing the admission of foreign insurance companies to do business here, and to correct the mistakes of law made by the commissioner. Such a construction would place Connecticut in the singular position of clothing the legal blunders of the commissioner with the dignity of final decisions of our highest court. Every instinct of justice suggests that the question of compliance with our laws in all these particulars should be entertained and determined by courts everywhere charged with the construction of statutes, and that whenever, as in this case, no other remedy is provided, the determination of such questions should be had upon proceedings in mandamus. Daly v. Dimock, 55 Conn., 579 ; Seymour v.. 6. When the commissioner acts under a mistake of law, and so refuses to grant the application and to license the agents of the applicant, mandamus will lie. State ex rel. N. Eng. Mut. Life Ins. Co. v. Reinmund, 45 Ohio St., 214 : Cincinnati c. R. R. Co. v. County Commissioners, 1 id., 77, 105; Citizens' Bank v. Wright, 6 id., 318; Thomas v. Armstrong, 7 Cal., 286 ; Tennessee Coosa R. R. Co. v. Moore, 36 Ala., 371 ; Gilchrist v. Collector of Charleston, 5 Hughes, 1; People ex rel. Kemp v. D' Oench, 111 N. York, 359; Chateaugay Ore Iron Co. v. Petimer, 128 U. S. R., 544 . 7. If the court should be of opinion that it is necessary to state affirmatively in the motion for mandamus that the commissioner finds or is satisfied that the applicant has complied with all statutory requirements and laws, then we submit that that fact is sufficiently set up in the motion, on two grounds: — 1st. Paragraphs three and five of the motion fully cover this point in the statement that the company has complied with all statutory requirements and laws. If this were not enough the pleader would have to state in particular that he had complied with every statutory requirement by setting out the requirement and alleging compliance. 2d. The letter of the commissioner of November 14th. 1890, is made part of the motion, and definitely sets forth the reasons for rejecting the company's application. It contains no hint, even, that he is not satisfied that the company has complied with all statutory requirements and laws, but bases the rejection simply on the ground that our "charter is an extraordinary one. E. D. Robbins, for the appellee.

Opinion of the Court

ANDREWS, C. J.

The plaintiff, a corporation organized under the laws of the state of Maryland, applied to the defendant, who is the insurance commissioner of this state, for permission to ■ transact in this state insurance business “ against loss and damage caused by accident to any person or property, arising from explosions of steam boilers or other causes, employers’ liability insurance, and the insurance of the fidelity of persons employed in positions of trust.” The defendant heard the application, and at the request of the plaintiff gave a second hearing. Then, after consideration, he declined to grant to the plaintiff the permission it had asked for. .The plaintiff thereupon made application to the Superior Court for a writ of peremptory mandamus, commanding the defendant to admit the plaintiff to do in this state the kinds of business above mentioned. The defendant accepted service of the application so made to the Superior Court, and that application, by consent of all the parties, has been treated as the alternative writ.

On the return day the defendant came into court and moved that the alternative writ be quashed. The court heard argument, and indicated that the motion ought to be granted unless the writ • should be amended, and gave the *459 plaintiff time in which to amend. The plaintiff neglected to make any amendment and the motion was granted. The plaintiff now appeals to this court..

In any case of mandamus, as the alternative writ is the foundation of all the subsequent proceedings, it must show upon its face a clear right to the extraordinary relief demanded, and the material facts on which the plaintiff relies must be distinctly set forth, so that they can be admitted or denied. If it does not do this it will be abated or held insufficient on a motion to quash. All formal objection to the writ must be taken by a motion to quash. Fuller v. Plain-field Academic School, 6 Conn., 582. And objections to the substance may be so taken. Moses on Mandamus, 202-206; Shortt on Mandamus, 397 ; High on Extr. Remedies, § 522; Commercial Bank of Albany v. Canal Commissioners, 10 Wend., 26 ; State ex rel. CothrenY. Lean, 9 Wis., 279.

The principle upon which persons holding public office may be compelled by a writ of mandamus to perform duties imposed upon them by law has been pretty clearly defined and strictly adhered to in numerous cases in this court and in courts of other states. Freeman v. Selectmen of Few Haven, 84 Conn., 406 ; Seymour v. Ely, 37 id., ‘103; Batters v. Dunning, 49 id., 479; Atwood v. Partree, 56 id., 80 ; U. States ex rel. Dunlap v. Black, 128 U. S. R., 40 ; U. States ex rel. Redfield v. Windom, 137 id., 636 ; Kendall v. United States, 12 Peters, 524; Decatur v. Paulding, 14 id., 497; United States v. Guthrie, 17 How., 304; Howland v. El-dredge, 43 N. York, 457; The People v. Brennan, 39 Barb., 651; Smith v. Mayor &c. of Boston, 1 Gray, 72.

The principle set forth in these authorities is, that a writ of mandamus may issue where the duty which the court is asked to enforce is the performance of some precise, definite act, or is one of a class of acts purely ministerial and in respect to which the officer has no discretion whatever and the right of the party applying for it is clear and he is without other adequate remedy; and that the writ will not issue in a case where the effect of it is to direct or control an executive officer in the discharge of an executive duty involving

*460 the exercise of discretion or judgment. The rule is stated very clearly by Mr. Justice Bradley in U. States ex rel. Dunlap v. Black, supra. He says: — “ The court will not interfere by mandamus with the executive officers of the government in the exercise of their ordinary official duties, even where those duties require the interpretation of the law, the court having no appellate power for that purpose ; but where they refuse to act in a case at all, or where by a special statute or otherwise a mere ministerial duty is imposed upon them, that is, a service which they are bound to perform without further question, then if they refuse a mandamus may be issued to compel them.” The same rule is given in High on Ext. Remedies, § 42, where that author adds : — “ Indeed, so jealous are the courts of encroaching in any manner upon the discretionary powers of public officers,, that, if any reasonable doubts exist as to the question of discretion or want of discretion, they will hesitate to interfere, preferring rather to extend the benefit of the doubt in favor of the officer.” “ A ministerial act is one which a person performs in a given state of facts, in a prescribed manner, in obedience to the mandate of legal authority, without regard to or the exercise of his own judgment upon the propriety of the act being done.” Flourney v. City of Jeffersonville, 17 Ind., 169.

The subject of insurance engages nearly one hundred and forty sections of the General Statutes and covers more than thirty pages of the statute book. All these sections taken together form a complete and symmetrical branch of the executive government of the state which in common speech is called the insurance department. The defendant is at the head of that department. His duties are, generally, that he “ shall see that all the laws relating to insurance companies are faithfully executed.” This alone vests him with a wide range of discretion and judgment.

But in addition to this general description of his duties there are repeated sections which impose upon him in terms the exercise of discretion. Section 2822 vests him with authority at any time to “ examine into the methods of busi *461 ness of any company, corporation, association, partnership, or combination of persons, doing any kind or form of insurance business in this state.” He may make orders binding upon such companies, and may apply for an injunction to control their business, or for the appointment of a receiver to wind it up. Sections 2829 to 2836 vest him with discretionary powers concerning fire and marine insurance companies. Sections 2857 and 2858 give him like powers concerning life insurance companies. By section 2869 he may apply for a reoeiver for any life insurance company and for the annulment of its charter. By section 2906 he may revoke the certificate he has issued to any insurance company incorporated by any other state, upon proof of its unsoundness. Section 2834 gives him discretion respecting the admission of fire and marine insurance companies into this state to do business. Section 2846 relates to foreign fire insurance companies ; section 2867 to life insurance companies, and section 2893 to assessment insurance companies. Throughout all these sections the authority given to the defendant is administrative, or quasi judicial, rather than-ministerial. Perry v. Reynolds, 53 Conn., 527.

It is admitted that there is no statute or rule of law that in terms makes it the duty of the defendant to admit the plaintiff to do in this state the kinds of business specified in its application. If it is his duty so to admit the plaintiff it is because such duty falls within the ordinary duties of his office; and this must be gathered from the construction of the insurance statutes. The defendant has construed these statutes as requiring, or at least as authorizing, him to refuse the plaintiff’s application. The plaintiff insists that such construction is wrong. The whole contention of the plaintiff’s counsel is that the statutes of this state respecting insurance, if construed in the light of the policy of this state towards the insurance companies of other states and in the light of state comity, would make it the duty of the defendant to grant the plaintiff’s request; and they say that their interpretation of these statutes is too obviously correct to admit of dispute, and that therefore the duty which *462 they ask that the defendant should perform is purely a ministerial one. This contention, however, involves a contradiction. The construction of a statute is not a ministerial act; it is the exercise of judgment. If it is the duty of the defendant to admit or not to admit the plaintiff to do business in this state according to the interpretation to be put on the insurance statutes, then the admitting or refusing to admit involves the exercise of discretion and judgment. It is precisely the same kind of a duty which selectmen perform in respect to the admission of electors; Perry v. Reynolds, 53 Conn., 527; or assessors in respect to the liability of property to taxation; Goddard v. Town of Seymour, 80 Conn., 394. It is not a purely ministerial act and a mandamus ought not to issue.

If the court was of the opinion that the defendant’s construction of the insurance statutes was an incorrect one it could not interfere by way of mandamus. That would be to substitute the judgment of the court for the judgment of the officer appointed by law, and would in effect make the court the insurance commissioner instead of the defendant.

“ If a suit should come before this court which involved the construction of any of these laws, the court certainly would not be bound to adopt the construction given by the head of a department. And if they suppose his decisions to be wrong they would, of course, so pronounce in their judgment. But their judgment upon the construction of a law must be given in a case in which they have jurisdiction and in which it is their duty to interpret the act of Congress in order to ascertain the right of the parties in the cause before them. The court could not entertain an appeal from the decision of one of the secretaries, nor revise his judgment in any case where the law authorized him to exercise discretion or judgment. Nor can it by mandamus act directly upon the officer and guide and control his judgment or discretion in the matter committed to his care, in the ordinary discharge of his official duties.” Decatur v. Paulding, 14 Peters, 497. See also United States v. Guthrie, 17 *463 Howard, 284; Commissioner of Patents v. Whiteley, 4 Wall., 522; Gaines v . Thompson, 7 id., 847; Freeman v. Selectmen of New Haven, 84 Conn., 406.

Tested by the authorities herein brought together it is plain that the alternative writ in this case does not state facts which entitle the plaintiff to a peremptory mandamus, and that the motion to quash was properly granted.

There is no error in the judgment appealed from.

In this opinion the other judges concurred.

Case-law data current through December 31, 2025. Source: CourtListener bulk data.