Foremost Life Ins. Co. v. Langdon
| Decision Date | 09 September 1981 |
| Docket Number | Nos. 5488,5489,s. 5488 |
| Citation | 633 P.2d 938 |
| Parties | FOREMOST LIFE INSURANCE COMPANY, and U.S. Life Credit Life Insurance Company, Appellants (Petitioners), v. John T. LANGDON, as Insurance Commissioner of the State of Wyoming, and The Wyoming Insurance Department, Appellees (Respondents). |
| Court | Wyoming Supreme Court |
George A. Zunker of Urbigkit & Whitehead, P.C., Cheyenne, for appellant, Foremost Life Ins. Co.
John A. Sundahl of Godfrey & Sundahl, Cheyenne, for appellant, U.S. Credit Life Ins. Co.
Steven F. Freudenthal, Atty. Gen., Gerald A. Stack, Deputy Atty. Gen., Criminal Division, and Kelly S. Davis, Sp. Asst. Atty. Gen., on behalf of appellees.
Glenn Parker and W. Douglas Hickey of Hirst & Applegate, Cheyenne, signed the amicus curiae brief on behalf of Consumer Credit Ins. Ass'n, in support of Foremost Life Ins. Co. and U.S. Life Credit Life Ins. Co.
Before ROSE, C. J., and RAPER, THOMAS, ROONEY and BROWN, JJ.
Appellants appeal from the district court's order affirming the Wyoming Insurance Commissioner's disapproval of the rates and forms submitted under Chapter 21 for credit life and disability insurance written for terms of five years or longer. We agree with the district court and will affirm.
The following issues have been raised on appeal: 1
1. Does Chapter 21 of the Wyoming Insurance Code prohibit the sale of credit life and credit disability insurance for terms exceeding five years?
2. If Chapter 21 of the Wyoming Insurance Code does not prohibit the sale of credit life and credit disability insurance for terms exceeding five years, may insurance designated as such be written using rates and forms approved under Chapter 21 of the Wyoming Insurance Code for periods of five years or longer because Article 4 of the Uniform Consumer Credit Code supplements and expands Chapter 21 of the Wyoming Insurance Code?
3. Are the Findings of Fact and Conclusions of Law, Decision and Order issued by the Insurance Commissioner insufficient as a matter of law?
In September of 1978, the Wyoming Insurance Department approved the rates and policy forms submitted by appellant U.S. Life Credit Life Insurance Company for the sale of credit life and disability insurance for terms exceeding 59 months. By letter dated April 9, 1979, the Wyoming Insurance Department withdrew its approval of these rates and policy forms.
Appellant Foremost Life Insurance Company had also been writing credit life insurance policies for terms exceeding 59 months. In April of 1980, Wyoming Insurance Department issued a notice and order to show cause challenging Foremost's sale of credit life insurance for terms exceeding 59 months.
After considerable legal jousting, Foremost, U.S. Life and the Wyoming Insurance Department stipulated to the facts and the issues 2 that were before the Wyoming Insurance Commissioner, thus eliminating the need for a hearing. In his Findings of Fact, Conclusions of Law, Decision and Order, the Insurance Commissioner withdrew the previous approval of appellants' rates and policy forms for credit life and disability insurance issued for terms exceeding 59 months.
The Insurance Commissioner concluded that the use of any rate or form styled to be "credit life insurance" or "credit disability insurance" may no longer be written for a term of five or more years. 3 We interpret the phrase "styled to be" as having a dual meaning: credit insurance that complies with the requirements set forth in Chapter 21 and also credit insurance that is called "credit life insurance" or "credit disability insurance." 4
Appellants then filed a petition for review in the district court. After reviewing the file and the briefs of the parties, the
district court judge entered an order affirming the Wyoming Insurance Commissioner's order. Appellants are appealing from the district court's order.
The first question we must address is whether Chapter 21 prohibits the sale of credit life and disability insurance for terms in excess of 59 months. The pertinent statute, Section 26-21-101, W.S.1977, Chapter 21, Wyoming Insurance Code, provides in part:
"All life insurance and all disability insurance in connection with loans or other credit transactions shall be subject to the provisions of this chapter; except, that insurance in connection with a loan or other credit transaction of five (5) years duration or more shall not be subject to this chapter * * *." (Emphasis added.)
The language of the statute is clear and unambiguous; therefore, "we will not look to statutory rules of construction, nor will we attribute another meaning to the statute." Matter of Estate of Reno, Wyo., 604 P.2d 550, 553 (1979). The statute does not prohibit the sale of credit insurance for terms of five years or longer, but rather provides that such insurance is not subject to Chapter 21 of the Wyoming Insurance Code.
Because Chapter 21 does not prohibit credit insurance written for terms of five years or longer, the next question is whether rates and forms approved under Chapter 21 can be used to write insurance for terms of five years or longer. After reviewing § 26-21-101, W.S.1977, the Insurance Commissioner stated in his conclusions of law:
As a general rule, courts give deference to the interpretation of a statute by the officers or the agency charged with the administration of the statute. Demos v. Board of County Commissioners of Natrona County, Wyo., 571 P.2d 980 (1977); County of Natrona v. Casper Air Service, Wyo., 536 P.2d 142 (1975); Kearney Lake, Land & Reservoir Company v. Lake DeSmet Reservoir Company, Wyo., 487 P.2d 324 (1971); and State ex rel. Goshen Irr. Dist. v. Hunt, 49 Wyo. 497, 57 P.2d 793 (1936). We agree with the Insurance Commissioner's interpretation of § 26-21-101, W.S.1977.
When the word "shall" is used by the legislature in a statute, courts interpret the statute as mandatory unless the context indicates a contrary legislative intent. Mayland v. State, Wyo., 568 P.2d 897, 899 (1977). Because § 26-21-101, W.S.1977, specifically provides that credit life and disability insurance written for terms of five years or longer "shall not be subject to this chapter," it is obvious that the legislature was setting forth a mandatory rule.
was correct. In upholding the Director's position, the court stated "Article 10 neither regulates, permits, nor prohibits such insurance (credit life and disability insurance issued for terms exceeding ten years), and more importantly insofar as concerns the issues involved in this case, it does not create any kind of implied exemption of such insurance from the general statutory and regulatory requirements otherwise imposed by the insurance code and applicable laws of the state of Arizona. * * * " Foremost Life Insurance Company v. Trimble, supra, at 364.
Appellants further contend that Article 4 of the Uniform Consumer Credit Code supplements and expands Chapter 21 of the Insurance Code. According to appellants, because of this supplementation or expansion, insurance written for periods of five years and not exceeding ten years may be written on forms and rates approved under Chapter 21 of the Insurance Code. In support of this contention, appellants state that the distinction between "credit life and disability" insurance as defined in Chapter 21 of the Wyoming Insurance Code and "consumer credit insurance" as defined in Article 4 of the Wyoming Consumer Credit Code "is a distinction without a difference." We cannot agree. We agree instead with the district court judge's finding that while there are similarities between the credit insurance authorized by Chapter 21 and that authorized by Article 4, there are also substantial differences. 6 For purposes of this opinion, we will not attempt to set forth all of the differences between these two sections but will discuss only a few. For example, Chapter 21 does not place a limit upon the amount of the debt that may be insured. However, the definitional sections of Article 4 for the three consumer credit transactions for which credit insurance may be issued, consumer credit sales (§ 40-14-204, W.S.1977), consumer leases (§ 40-14-206, W.S.1977), and consumer loans (§ 40-14-204, supra) limit the amount financed to $25,000. Section 26-21-106(b), W.S.1977, mandates that the creditor is to be the beneficiary for each individual policy or group certificate of insurance. Article 4 does not require that the creditor be listed as the beneficiary. Finally, Chapter 21 does not require that the insurance be decreasing term insurance; Article 4 does. 7
Appellants cannot take favorable provisions out of Article 4 and engraft them into Chapter 21, thus producing a hybrid scheme of insurance. If this were permissible, the result would be a scheme of insurance that allows credit insurance to be written for terms up to ten years without the limitations required by Article 4. This court has long held that it "will not enlarge, stretch, expand or extend a statute to matters not falling within its express provisions." Lo Sasso v. Braun, Wyo., 386 P.2d 630, 632 (1963). Appellants' interpretation of the statutes would result in a partial repeal of Chapter 21,...
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