Atlas Mutual Ins., Co. v. Fisheries Co.
| Decision Date | 05 April 1907 |
| Citation | 22 Del. 256,68 A. 4 |
| Court | Delaware Superior Court |
| Parties | ATLAS MUTUAL INSURANCE COMPANY, a corporation existing under the laws of the Commonwealth of Massachusetts, by FRANKLIN T. HAMMOND, Receiver, v. THE FISHERIES COMPANY, a corporation existing under the laws of the State of New Jersey |
Superior Court, New Castle County, February Term, 1907.
ACTION OF ASSUMSIT (No. 23, September Term, 1906), to recover assessments paid on certain fire insurance policies held by the defendant.
Demurrer to plea in abatement.
The demurrer is sustained.
Caleb E. Burchenal and William S. Hilles for plaintiff.
Robert Penington and William G. Jones for defendant.
OPINION
:--In the year 1903, the defendant, a corporation of the State of New Jersey, entered into four contracts of insurance with the plaintiff, a corporation of the Commonwealth of Massachusetts. Policy No. 3210 was on the property of the defendant located at Promise Land, Long Island, State of New York, and covered the period from June 8, 1903, until June 8 1904. Policies Nos. 3383 and 3384 were on two separate properties designated as the James Lennon and Company plant and the Luce Brothers plant, respectively, and owned or controlled by the defendant situate at Lewes, Delaware. The insurance on each of these properties ran from August 3, 1903, until October 3, 1904. Policy No. 3464 was on the dried fish scrap in, and on the premises of the Delaware Fertilizer Company plant, owned or controlled by the defendant, situate at Lewes, Delaware. This insurance ran from September 10, 1903, until September 10, 1904.
At the time of entering into these contracts of insurance, the plaintiff had not complied with the insurance laws of the State of Delaware, and had no agent in this State and had solicited no business in this State. The defendant applied to the plaintiff at its office in Boston, Massachusetts, for the insurance, and it was there that the contracts for insurance were signed and delivered.
In 1904 the plaintiff became embarrassed for funds, and was duly enjoined from further proceeding with its business. On March 11, 1904, Franklin T. Hammond was duly appointed receiver of the company by the Supreme Judicial Court of Massachusetts, a court of full and competent jurisdiction in the premises. February 13, 1905, an assessment was duly made upon the members of the company for losses sustained, and notice of the defendant's share of said assessment was sent to him about March 1, 1905. The assessments on the above mentioned policies were as follows:
For the recovery of the foregoing assessments this suit was instituted.
The defendant pleads in abatement, that the plaintiff company being a foreign insurance company, had no right to make, write, place, or cause to be made, written or placed, any policy of fire insurance upon any property, situated or located in the State of Delaware until it had complied with the insurance laws of the State.
The plea sets out such failure to comply with the laws, as follows: in this, that the said policies of insurance mentioned in the declaration, had not been approved in writing by an agent of the said fire insurance company who is a resident of the State of Delaware regularly commissioned and licensed to transact insurance business herein; and in that the said policies of fire insurance had not been countersigned by such agent; and in that the State of Delaware had not received the taxes required by the laws of the said State to be paid on premiums collected for insurance on all property located in the said State of Delaware, as required by Section 11, Chapter 99, Volume 20 of the Laws of Delaware; and also in that the said corporation had not delivered to the Insurance Commissioner of the State of Delaware a certified copy of its charter; and also in that the said corporation had not filed with the Insurance Commissioner of the State of Delaware a certificate of the name and residence of some person or agent within this State upon whom service of process could be made, as required by Section 7 of said Chapter 99.
To this plea in abatement the plaintiff demurs generally.
It is conceded by the defendant that the contracts of insurance in this case were made out of the State of Delaware, in good faith and with no intent to evade the insurance laws of this State.
The defendant insists, however, that the insurance laws of Delaware apply to the contracts because the property insured was situated within the State.
Under this contention, the plea in abatement is bad as to the claim under policy No. 3210 as set out in the first count of the declaration of the plaintiff, because it appears that the contract of insurance was made out of the State, and that the insured property was located at Promise Land, Long Island, State of New York.
The property insured in policies Nos. 3383, 3384, and 3464, designated in counts Nos. 2, 3, and 4, respectively, of the declaration of plaintiff, was all located at Lewes in the State of Delaware.
As to the claims under these three last-named policies, the plaintiff contends, that as the contracts of insurance were made and completed in Massachusetts, their validity is to be ascertained under the laws of Massachusetts, and not those of the State of Delaware.
It seems to be settled law, that where a foreign contract of insurance which has been made and completed in one State is sued upon in another, the laws of the State where the contract was made, govern, and that the contract will be enforced by comity in the State where the action is instituted.
In Western Mass. Fire Ins. Co. vs. Hilton, 42 A.D. 52, 58 N.Y.S. 996, the plaintiff, a corporation of Massachusetts, insured the property of the defendant which was located in New York. The contract was made at the company's office at Springfield, Massachusetts.
The New York statute provided that "All fire insurance policies issued to residents of this State on property located herein, by companies that have not complied with the requirements of the general insurance laws of the State shall be void," etc. The plaintiff had not complied with this law.
The Court held that the contract was a Massachusetts contract, that the parties were legally liable there, and that such liability would be enforced in New York.
It further held that to extend the New York law to contracts made out of the State, would be a violation of the Fourteenth Amendment to the Federal Constitution.
Col. Fire Ins. Co. vs. Kinyon, 8 Broom, N. J. 33; Ins. Co. vs. Way, 62 N.H. 622; Swing vs. Hill, 165 Ind. 411, 75 N.E. 658; Swing vs. Brinton, 87 Miss. 516, 40 So. 146.
The plaintiff further contends, that if the laws of Delaware apply to this case, that so much of the said law as prohibits its citizens from entering into contracts outside of the State insuring property located within the State, is unconstitutional.
In Allgeyer vs....
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