The State ex inf. Crow v. Aetna Insurance Co.

• Decision Date: 30 May 1899
• Parties: The State ex inf. Crow, Attorney-General, v. Aetna Insurance Company et al.; and the State ex inf. Crow, Attorney-General, v. American Central Insurance Company
• Court: Missouri Supreme Court

51 S.W. 413

150 Mo. 113

The State ex inf. Crow, Attorney-General, v. Aetna Insurance Company et al.; and the State ex inf. Crow, Attorney-General, v. American Central Insurance Company

Supreme Court of Missouri

May 30, 1899 ^[*]

Writs of ouster denied.

Edward C. Crow, Attorney-General, and Sam B. Jeffries, Assistant Attorney-General, for relator.

(1) The act divides a natural class, to wit, fire insurance companies, into two portions, making two classes out of one and thus, in effect, arbitrarily enacts different rules for the government of each. This is contrary to the Constitution and laws of the State of Missouri. State v. Julow, 129 Mo. 163; State v. Walsh, 136 Mo. 400; Art. IV sec. 53, Constitution. (2) This statute is class legislation. A statute which relates to persons or things as a class is a general law, while a statute which relates to particular persons or things of a class is special legislation. State ex rel. v. Tolle, 71 Mo. 650; State v Julow, 129 Mo. 163. (3) If a statute attempts to accomplish two or more objects and is void as to one, it may still be in every respect complete and valid as to the other. Cooley's Const. Lim. (6 Ed.), p. 211; State ex rel v. Field, 119 Mo. 593; State ex rel. v. Higgins, 125 Mo. 364; State v. Bockstruck, 136 Mo. 335. It is no objection to sustaining a portion of the law and holding a part invalid that the valid and invalid parts are in the same section. State v. Bockstruck, 136 Mo. 335. (4) Fire insurance combines in cities of one hundred thousand inhabitants or over would have been illegal at common law in Missouri. R. S. 1889, sec. 6561; 10 Am. Ry. & Corp. Cases, 108; U. S. v. Addyston Pipe & Steel Co., 85 F. 287; Greenhood on Public Policy, p. 696; Telegraph Co. v. Crane, 160 Mass. 50; 78 Mo. 584. (5) Insurance is a commodity within the meaning of the statute against trusts and combinations. Beechley v. Mulvihill, 70 N.W. 107; U. S. v. Addyston Pipe & Steel Co., 85 F. 271; Metzger v. Cleveland, 13 Ins. L. J. 855; American Fire Ins. Co. v. State, 26 Ins. L. J. 861.

Campbell & Ryan and Waddill & Hereford for respondents.

(1) The rule established in this State is "that a statute which relates to persons or things as a class, is a general law, while a statute which relates to particular persons or things of a class, is special." State ex rel. v. Bronson, 115 Mo. 271; State ex rel. v. Bell, 119 Mo. 70; Dunne v. Street Ry., 131 Mo. 1. (2) Law applicable to cities having at the time of the passage of the law, a designated number of inhabitants, or which may thereafter acquire such number, have repeatedly been held by this court to be general not special. Ewing v. Hoblitzelle, 85 Mo. 64; Rutherford v. Heddens, 82 Mo. 388; State v. Herman, 75 Mo. 340; Kelly v. Meeks, 87 Mo. 396; Rutherford v. Hamilton, 97 Mo. 543; State v. Miller, 100 Mo. 439. (3) The proviso in the act is general, not special. The only test as to whether a law is general or special is the possibility of its future application, no matter with what particularity the classification is made. A classification by population is legitimate. State v. Jennings, 98 Mo. 493; State v. Hathaway, 115 Mo. 36; Lynch v. Murphy, 119 Mo. 163; State v. Arnold, 136 Mo. 446; Philips v. Railroad, 86 Mo. 540. (4) It is only when it relates to particular persons or things of a class that it is special. All that can be required is that it shall be general in its application to the class and locality to which it applies. Ewing v. Hoblitzelle, 85 Mo. 64; Lynch v. Murphy, 119 Mo. 163; State v. Burgdoerfer, 107 Mo. 34; State v. Lewis, 101 U.S. 22; Cooley's Const. Lim. 481. (5) The court, with a view to deciding whether a law is a special law or not, will look into the rationale of the matter to determine whether it has a reasonable basis on which to stand. State v. Miller, 100 Mo. 439; State v. Loomis, 115 Mo. 307; State ex rel. v. Bell, 119 Mo. 70; Dunn v. Street Ry. Co., 131 Mo. 5; Railroad v. Ellis, 165 U.S. 155; Cooley's Con. Lim. 480; Beach on Modern Law of Contracts, sec. 1569.

OPINION

In Banc.

Quo Warranto.

BURGESS J.

These are quo warranto proceedings by the relator, as Attorney-General, against respondents, nonresident insurance companies doing business in this State, to oust them, upon the ground as alleged in the petition that they are members of a trust and pool at Kansas City, Mo., to regulate and fix the price or premium to be paid for insuring property in said city, against loss or damage by fire, lightning or storm, and to maintain and control the price when so regulated and fixed.

The petition alleges that each of the defendants is a nonresident corporation duly organized and carrying on the business of fire insurance in this State, they having been licensed by the Insurance Commissioner of the State so to do.

The petition then proceeds as follows: "That afterwards, to wit, on the -- day of July, A. D. 1897, each and all of said defendant corporations, unlawfully misused and abused their said franchises, rights and privileges as fire insurance companies, authorized to do business under the laws of the State of Missouri, by, within the city of Kansas City, Jackson County, Missouri, creating, entering into, becoming a member of, and a party to a certain pool, trust, agreement, combination, confederation, and understanding with each other, and other fire insurance corporations, and associations of persons, to regulate and fix the prices and premiums to be paid for insuring property in said Kansas City, Jackson County, Missouri, against loss or damage by fire, lightning and storm, and to maintain and control said price when so regulated and fixed.

"That each and everyone of said defendant corporations is represented in said Kansas City, Jackson County, Missouri, by a local resident fire insurance agent, legally and fully authorized by each of said several corporations to act for their respective corporations in all matters relating to the insuring of property against loss or damage by fire, lightning and storm, in said city, and that heretofore, to wit, on the -- day of July, A. D. 1897, each of said defendant corporations, by their respective agents (each of which said several agents are duly and legally licensed and authorized to write said insurance under the laws of the State of Missouri), entered into and were members of, and are now members of, a certain association and organization composed of said fire insurance agents and the agents of other fire insurance companies known as the Board of Underwriters, the exact name of which said Board of Underwriters is to this relator unknown. The general nature and object of said Board of Underwriters is, first, to fix and regulate a certain price or premium to be paid for insuring property against loss or damage by fire, lightning and storm in the said city of Kansas City, and second, to maintain the said prices or premium, when so regulated or fixed, for insuring property against loss or damage by fire, lightning and storm in said city.

"And that the said defendant corporations, through said Board of Underwriters aforesaid, and in pursuance of the object, purpose and intention of said defendant corporations, have unlawfully agreed, combined and confederated with each other, and with other fire insurance corporations (doing business under the insurance laws of the State of Missouri), to form an insurance trust in Kansas City, Missouri, to regulate, fix and maintain the price or premium to be charged by each of said corporations for insuring the different designated classes of risks on property against loss or damage by fire, lightning and storm in Kansas City, Missouri.

"And the said defendant corporations, and other insurance companies, acting with them, in pursuance of the said agreement, combination, confederation and trust, are each of them, through their respective agents, unlawfully maintaining said agreed price or premium upon the respective classes of risks on property against loss by fire, lightning and storm in Kansas City, Missouri, and which said rate so fixed by said agreement aforesaid, is the minimum rate charged in Kansas City, Missouri, by all said defendant corporations. And that said rate aforesaid, so fixed as aforesaid, is the minimum rate agents of said insurance companies are allowed to charge by said defendant corporations within the city of Kansas City, Missouri.

"And relator charges and avers that since the -- day of July, A. D. 1897, said defendant corporations in the city of Kansas City, Jackson County, Missouri, have offended against the laws of this State, and have greatly abused and misused their corporate authority, franchises and privileges, and unlawfully assumed and usurped franchises and privileges not granted to said corporations by the laws of the State of Missouri, by entering into, becoming a member of and a party to said pool, trust, combination and confederation, as aforesaid, to regulate, fix and maintain the price and premiums to be paid for insuring property against loss or damage by fire, lightning and storm in Kansas City, Missouri.

"And relator further charges that the action of the defendant corporations hereinbefore set out, is a gross perversion of the franchise granted to them by the State of Missouri, and an illegal usurpation of privileges not granted to them, and which said usurpation of privileges and franchises not granted them is of great injury to the public."

Respondents answered jointly, admitting that they are foreign corporations duly organized and respectively engaged in the business of fire insurance; and allege that they have complied with the laws of the State of Missouri with respect to foreign insurance companies desiring to do a fire business therein, they having been duly licensed by the...