Oklahoma Benefit Life Ass'n v. Bird
| Decision Date | 16 March 1943 |
| Docket Number | 31240. |
| Citation | 135 P.2d 994,192 Okla. 288,1943 OK 103 |
| Parties | OKLAHOMA BENEFIT LIFE ASS'N et al. v. BIRD et al. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
1. As a general rule, where the Legislature has declared that certain classes of cases shall be prosecuted in the name of the state by certain persons or officers, such cases may not be maintained by any one other than the persons or officers so designated.
2. The Insurance Commissioner has been designated by the Legislature as the officer to maintain actions for the appointment of receivers of insurance companies, and policyholders may not maintain such actions. Secs. 22, 23, art. 6, Const.; 36 O.S.1941, § 76.
3. Prior to the action of the Insurance Commissioner in approving or disapproving a reinsurance contract pursuant to 36 O.S.1941 § 696, entered into between a mutual benefit association and another insurance company, the members of said association may not maintain an action against the association and its officers to restrain the consummation of said contract, and to remove said officers for alleged illegal acts committed in the execution of the contract.
Original action by Oklahoma Benefit Life Association and others against J. W. Bird, as judge of the District Court of Garfield County, and the District Court of Garfield County for prohibition against respondent judge commanding him to renounce jurisdiction in an action filed in respondent court.
Writ granted.
Cheek Gibson & Savage, of Oklahoma City, for petitioners.
Harry C. Kirkendall, of Enid, for respondent.
Mac Q Williamson, Atty. Gen., and Fred Hansen, Asst. Atty. Gen amicus curiae.
This is an original proceeding wherein the petitioners seek a writ of prohibition against the respondent J. W. Bird as judge of the district court of Garfield county commanding him to renounce jurisdiction and to take no further proceedings in a certain action filed in said court.
The action in the lower court was instituted by one Rumsey and certain other parties against the petitioners Oklahoma Benefit Life Association, a corporation, and J. T. Tresner and M. J. Tresner, president and secretary, respectively, of said corporation. The corporation is a mutual benefit association organized and operating pursuant to 36 O.S.1941 §§ 691-707, and the plaintiffs are holders of benefit certificates therein. Their action against the association and its officers is somewhat similar to the ordinary class suit in equity by stockholders against the directors and officers of a corporation to restrain a breach of trust involving the corporate assets. A mutual benefit association is carried on for the benefit of its members, and they have a voice in its affairs similar to the stockholders in the ordinary commercial corporation. 36 O.S.1941 §§ 693, 694.
The petitioners herein say that the relief sought by the plaintiffs in the court below is of the character which under the existing laws may be adjusted only through the offices of the Insurance Commissioner, or may be adjudicated in the courts only at the suit of the Commissioner in his official capacity.
The main purpose of the action in district court was to restrain the present petitioners from consummating a reinsurance contract with Oklahoma Life Insurance Company. The petition charged that the said J. T. Tresner owned the majority stock in said life insurance company; that he was president thereof, and M. J. Tresner was vice president; that the proposed insurance contract would transfer to the insurance company all the assets of the association, and convert the benefit certificates into policies in a company operating on a legal reserve basis, all to the alleged disadvantage and loss of the complainants and others similarly situated. It was further charged that by reason of certain illegal acts on the part of the officers aforesaid the reinsurance contract was authorized without the consent of a majority of the certificate holders. The officers were charged with certain ulterior motives and ultra vires acts in connection with the reinsurance contract designed to injure the certificate holders to the benefit of the officers. The complainants also sought the removal of said officers and the appointment of a trustee or receiver for an audit of the books of the association, and that the certificate holders be given an opportunity to vote their will in all matters pertaining to association and the election of officers thereof.
Had the case in district court been an ordinary action by stockholders against the officers of the corporation the petition may have stated a cause for equitable relief. But, unlike the ordinary business corporation, insurance companies have been placed under the general supervisory control of the Insurance Department of the State, and that department is charged with the execution of all laws in relation to insurance and to insurance companies doing business in the State. Sec. 22, art. 6, Const. And the Insurance Commissioner is the executive head of the Insurance Department. Sec. 23, art. 6, Const.
Said section 22 in charging the Insurance Department with the execution of all laws, present and future, relating to insurance companies, contemplates, at least, those laws having for their purpose the regulation of such companies in all matters pertaining to the...
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