Chehalis River Lumber & Shingle Co. v. Empire State Sur. Co.

• Decision Date: 23 July 1913
• Docket Number: 1,320.
• Citation: 206 F. 559
• Court: U.S. District Court — Western District of Washington
• Parties: CHEHALIS RIVER LUMBER & SHINGLE CO. v. EMPIRE STATE SURETY CO.

206 F. 559

CHEHALIS RIVER LUMBER & SHINGLE CO. v. EMPIRE STATE SURETY CO.

No. 1,320.

United States District Court, W.D. Washington, Southern Division.

July 23, 1913

H. G. &amp Dix Rowland, of Tacoma, Wash., for plaintiff.

John P Hartman, of Seattle, Wash., for defendant.

CUSHMAN District Judge.

This matter is for decision upon demurrer of the plaintiff to defendant's plea denying the court's jurisdiction. By the suit plaintiff seeks to recover upon a policy of insurance against loss on account of injuries to plaintiff's workmen. The policy was issued in 1910. In July, 1910, an employe of plaintiff was injured. In March 1911, such employe began suit against plaintiff, which resulted in judgment against it in February, 1912, which judgment was sustained upon appeal to the state Supreme Court, by decision rendered in 1913. Plaintiff is a Washington corporation, while defendant is a New York corporation. on the state insurance commissioner, a statutory agent for service, in 1913.

The defendant's answer, challenging the court's jurisdiction, alleges that more than four years ago the defendant qualified to engage in business in Washington; that it continued transacting business therein until August 22, 1912, when it ceased to do business in the state, canceled its agencies, and reinsured its risks in force in the state; that, theretofore, in August, 1910, it appointed an agent for service in the state; that in June, 1911, it appointed the state insurance commissioner its agent for service; that in November, 1912, after ceasing to do business in the state, it canceled and revoked both of the foregoing appointments; that such revocations were filed with and accepted by the insurance commissioner.

Plaintiff relies upon the following authorities: Section 6235, Rem. & Bal. Code; Laws Wash. 1911, c. 49, Sec. 13, pp. 173, 174; Mutual Reserve Fund Life Ass'n v. Phelps, 190 U.S. 147, 23 Sup.Ct. 707, 47 L.Ed. 987; Hunter v. Mutual Reserve Life Ass'n, 218 U.S. 573, 31 Sup.Ct. 127, 54 L.Ed. 1155, 30 L.R.A. (N.S.) 686; Bedford v. Eastern B. & L. Ass'n, 181 U.S. 227, 21 Sup.Ct. 597, 45 L.Ed. 834; Moore v. Mutual Reserve, 129 N.C. 31, 39 S.E. 637; Groel v. United Elec. Co., 69 N.J.Eq. 397, 60 A. 822; Mutual Reserve Fund Life Ass'n v. Tuchfeld, 159 F. 837, 86 C.C.A. 657; Michael v. Mutual Ins. Co., 10 La.Ann. 737; Pervangher v. U.C. & Surety Co., 81 Miss. 32, 32 So. 909; Gibson v. Mfg. F. & M. Ins. Co., 144 Mass. 81, 10 N.E. 729; Germania Ins. Co. v. Ashby, 112 Ky. 303, 65 S.W. 611, 99 Am.St.Rep. 295; Hill v. Empire State-Idaho Min. & Dev. Co. (C.C.) 156 F. 797; Collier v. Mutual Reserve (C.C.) 119 F. 617.

Defendant relies upon the following authorities: Pierce's Code, Sec. 5631; Swann v. Mut. Reserve Fund Life Ass'n (C.C.) 100 F. 922; Friedman v. Empire Life Ins. Co. (C.C.) 101 F. 535; Millan v. Mut. Reserve Fund Life Ass'n (C.C.) 103 F. 764, at page 769; Lathrop-Shea & Henwood Co. v. Interior Construction & Imp. Co. (C.C.) 150 F. 670, reversed and remanded 215 U.S. 246, 30 Sup.Ct. 76, 54 L.Ed. 177; Home Ins. Co. v. New York, 119 U.S. 129, at page 147, 8 Sup.Ct. 1385, 30 L.Ed. 350.

A Washington statute, applicable to insurance companies of the character of defendant at the time the insurance policy was issued, provided:

'Every such corporation organized outside of this state, shall constitute and appoint an agent who shall reside in this state, to be designated as hereinafter required * * * and shall authorize such agent to accept service of process in any action or suit pertaining to the property, business or transactions of such corporation within this state, in which such corporation may be a party, * * * and such corporation shall have and keep continually some resident agent, empowered as aforesaid, during all the time such corporation shall conduct or carry on any business within this state, and service of any process, pleading, notice or other paper on such agent shall be taken and held as due service on such corporation. If any attorney of any surety corporation, appointed under the provisions of this act, shall remove from the state, or become disqualified in any manner from accepting service, valid service may be made on such corporation by service upon the insurance commissioner. ' Section 6235, Rem. & Bal. Code.

In 1911, the state Legislature by a further act provided:

'The commissioner shall not issue a certificate of authority to transact any business of insurance in this state to any foreign or alien insurance company until it has executed and filed in his office a written appointment of the insurance commissioner to be the true and lawful attorney of such company in and for this state, upon whom all lawful process in any action or proceedings against such company commenced in any county in this state may be served with the same effect as if it were a domestic company having its principal office in such county. The service upon such attorney shall thereafter be deemed service upon the company. ' Session Laws 1911, pp. 173, 174, c. 49, Sec. 13.

As stated, the defendant complied with the latter act, and in 1911 designated by proper appointment the insurance commissioner as its agent for service, and thereafter continued in the transaction of insurance business in the state until August, 1912...