Employers Cas. Co. v. Hobbs
| Decision Date | 06 May 1939 |
| Docket Number | 34233. |
| Citation | 149 Kan. 774,89 P.2d 923 |
| Parties | EMPLOYERS CASUALTY CO. v. HOBBS, Commissioner of Insurance, et al. |
| Court | Kansas Supreme Court |
Syllabus by the Court.
Under the retaliatory provisions of the statutes pertaining to foreign insurance companies authorized to do business in Kansas, the retaliatory exaction to be made by the commissioner of insurance is to be determined by comparing the aggregate amount of the taxes, fees, and charges calculated according to the statutory requirements, with the aggregate amount of the taxes, fines, penalties, certificates of authority, licenses, fees, compensation for examination or otherwise, which the foreign state, territory, or country would require from an insurance company of like size organized under the laws of Kansas applying to do business there, and if the amount so exacted should exceed the amount due the state of Kansas. the excess may be exacted in retaliation. Gen.St.1935, 40-253.
Under G.S.1935, 40-253, the retaliatory exaction to be made by the commissioner of insurance from an insurance company organized under the laws of any other state, territory or country, is to be determined by comparing the aggregate amount of the taxes, fees and charges, calculated according to our statutory requirements, with the aggregate amount of the taxes, fines, penalties, certificates of authority, licenses fees, compensation for examination, or otherwise, which such other state, territory or country would require from an insurance company of like size organized under the laws of Kansas applying to do business there, and if the amount which would be due the other state, territory or country exceeds the amount due the state of Kansas from the foreign insurance company, the excess may be exacted in retaliation.
Original proceeding in mandamus by the Employers Casualty Company against Charles F. Hobbs, as Commissioner of Insurance of the State of Kansas, and others to compel repayment to plaintiff of an alleged excess of taxes, fees, and charges paid by the plaintiff under protest in 1938 for the preceding year's business, and as a result of an exaction under the retaliatory provisions of statutes pertaining to foreign insurance companies.
Limited writ of mandamus issued.
Thomas F. Doran, Clayton E. Kline, M. F. Cosgrove, Balfour Jeffrey and Robert E. Russell, all of Topeka, for plaintiff.
Jay S. Parker, Atty. Gen., and C. Glenn Morris, Asst. Atty. Gen., for defendants.
This is an original proceeding in mandamus to compel repayment to the plaintiff of a claimed excess of taxes, fees and charges paid by the plaintiff under protest in 1938 for the preceding year's business, and as a result of an exaction by the commissioner of insurance under the retaliatory provisions of our statutes pertaining to foreign insurance companies authorized to do business in this state.
There is no dispute of fact, and the legal question pertains to the proper method to be applied in fixing the amount to be exacted, if any, under the retaliatory statute.
It may be observed the general purpose of retaliatory statutes is to compel equality of treatment of foreign and domestic corporations as between state and state or state and another country. Although some of the legislation is directed at corporations generally, most of the statutes are directed at insurance corporations. Discussion of the general question may be found in Fletcher on Corporations, Perm. Ed., Vol. 17, p. 456, § 8461; Thompson on Corporations, 3rd Ed., Vol. 8, p. 819, § 6598; Couch, Cyclopedia of Insurance, Vol. 1, p. 580, § 246; 12 R.C.L. 66; 14 R.C. L. 863; 14a C.J. 1268; and 32 C.J. 991.
Our first comprehensive act regulating insurance companies was Laws 1871, ch. 93. Section 17 of that act contained not only the schedule of fees to be exacted from every insurance corporation doing business in the state, but also a provision for retaliation as that word is used herein. This above section has been frequently amended, but essentially the retaliatory provisions have been little changed. The constitutionality of the section was challenged in Phoenix Ins. Co. v. Welch, 29 Kan. 672, and the section was declared valid. In discussing the nature of the retaliatory clause, this court, in an opinion by Brewer, J., said: '
Original section 17, referred to in the above opinion, has, by amendment, been subdivided, and now appears as follows: G.S.1935, 40-252, requires that every insurance company organized under the laws of this state or doing business in this state shall pay annually to the commissioner of insurance the fees and taxes specified. Reference to that section will disclose the variance made between corporations organized under the laws of this state, and those organized under the laws of another state. The retaliatory portion of the original section now appears as G.S.1935, 40-253, and reads as follows: "Whenever the existing or future laws of any other state or country shall require from insurance companies or fraternal benefit societies organized under the laws of this state, or of the agents thereof, applying to do business in such other state or country, any deposit of securities in such state or country for the protection of policyholders therein, or otherwise, or any payment for taxes, fines, penalties, certificates of authority, licenses, fees, compensation for examination, or otherwise, greater than the amount required for such purpose from insurance companies of other states by the then existing laws of this state, then, and in every case, all companies of any such state or country, doing business in this state shall make the same deposit, for a like purpose, with the commissioner of insurance of this state, and pay to the commissioner of insurance for taxes, fines, penalties, certificates of authority, licenses, fees, compensation for examination, or otherwise, an amount equal to the amount of such charges and payments imposed by the laws of such other state or country upon the companies of this state and the agents thereof."
It may here be stated that plaintiff presents two alternative theories as to the method for determining the amount of fees, taxes or other exactions to be paid this state by a corporation organized under the laws of another state or country. The first is that the specified items of fees, of taxes and of other exactions of this state as set forth in our statutes are to be compared with the like specified items set forth in the statutes of the incorporating state. The corporation is to pay to this state the amount of each specified item as set forth in our statute, but if on a like item the statute of the corporate domicile requires a higher rate or amount, then that higher rate or amount shall control, but if the statute of the corporate domicile shall provide for any particular fee or other exaction tax not specified in the Kansas statute, there may be no exaction on account thereof. In the alternative, it contends that if the above method be not proper, then there should be no comparison of any particular items either of fees or taxes, etc., or of totals of fees, of taxes, etc., but that comparison be made of grand totals of both fees, taxes, etc., calculated under the laws of this state and under the laws of the corporate domicile, and if the grand total under the laws of the foreign state exceeds that under the laws of this state, the retaliatory tax should be limited to that excess.
The defendant's theory is that he may compare specific items of fees, of taxes, and of other exactions as set forth in our statutes with the same specific items as set forth in the statutes of the corporate domicile, and take the higher amount of fees or the higher rate of tax, etc.; that if our statutes provide...
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In re Insurance Tax Cases
... 161 P.2d 726 160 Kan. 300 In re INSURANCE TAX CASES. AETNA INS. CO. v. HOBBS, Com'r of Insurance, and fifteen other cases. Nos. 36418, 36421-36429, 36445, 36448, 36449, 36466, ... Jeffrey, and Robert E ... Russell, all of Topeka, on the brief for plaintiff Employers ... Casualty Co ... A. B ... Mitchell, Atty. Gen., and Harry W. Colmery, of Topeka ... Shepard), ... 230 U.S. 352, 33 S.Ct. 729, 739, 57 L.Ed. 1511, 48 ... L.R.A.,N.S., 1151, Ann.Cas.1916A, 18. It was there said: ... 'If a state enactment imposes a direct burden upon ... ...
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