State v. Towle

The state sues to recover a penalty of the defendant for acting as a soliciting agent for the Single Men’s Endowment Association, a company having its home in the state of Minnesota, and doing business in this state without a license from the insurance commissioner. The question is whether or not this association is an insurance company, under the provisions of the R. S., c. 49 § 73.

The contract between the company and its patrons declares the duties which must be assumed by the single man who becomes privileged to an endowment in the association. He pays ten *289dollars as an initiation fee ; two dollars as annual dues each year for nine years, and as much longer as he remains single ; one dollar and a.quarter on the marriage of any associate; and he promises on the pain of forfeiture of all rights accruing to him, that he will not himself marry within two years from the date of his admission to the association. For the performance by him of these undertakings, the company promises to pay to his wife, if married to him after the expiration of the two years, the sum of as many dollars as there are associates in the order, not exceeding one thousand dollars, provided that there be that amount of money in the treasury at the time, or it can be collected by an assessment upon the associates. No word is spoken of insurance. That it is a wagering or gambling contract, and void upon grounds of public policy, because in restraint of marriage, there is no room for doubt. The same or a similar contract has been held to be void in White v. Equitable Nuptial Benefit Union, 7 Ala. 251; and in Chalfant v. Payton, 96 Ind. 202.

The counsel for both parties agree that the contract, for one reason or another, is illegal, but the counsel for the state contends that, whether the contract be legal or illegal, it is a contract of insurance, and that, as such, it falls under the supervision of the commissioner.

It is not to be conceded, wc think, that this contract, in the sense of any modern use of the term, is an insurance policy. No loss or casualty or peril is named for which any indemnity is promised. It is more of a betting contract on a future event. It is true that there was formerly a class of betting contracts styled insurances, and that a narrow line once existed between gambling and betting contracts and those then denominated contracts of insurance. And the case of Patterson v. Powell, 9 Bing. 320, relied on by the state, shows how far a court was induced to go to determine that a contract, similar in principle to the present, ivas an insurance policy, in order to declare it void. The statute, 4 Geo. 3, c. 48, rendered certain speculative insurance contracts void, and, strange to say, allowed all *290contracts founded on mere bettings and gamblings to be valid. At this day, the contract in that case, with all its imitations of the thing, would, hardly receive the appellation of an insurance policy.

It does not seem probable that the legislature intended to commit to the care of the commissioner the business of illegal or illegitmate insurance companies. It would be tolerating instead' of condemning them. He has the power to issue and suspend licenses. But there must be cause for either act. R. S., c. 49, § § 73, 75. His business is to deal with such companies as can, when licensed, issue legal policies. His act cannot confer legality upon companies doing illegal business. The state seeks to recover a penalty of fifty dollars, because the defendant acted without an official license, while the policy, if to be called such, issued by him, would be unlavvful and void, whether he was acting with or without a license. It would be inconsistent to collect a penalty of an agent for not doing business under a void license. Plaintiff nonsuit.