French v. The Mayor and Common Council of The City of Millville

• Decision Date: 10 June 1901
• Citation: French v. The Mayor and Common Council of The City of Millville, 49 A. 465, 66 N.J.L. 392 (N.J. 1901)
• Court: New Jersey Supreme Court
• Parties: THOMAS E. FRENCH, RECEIVER OF THE MILLVILLE MUTUAL MARINE AND FIRE INSURANCE COMPANY v. THE MAYOR AND COMMON COUNCIL OF THE CITY OF MILLVILLE

49 A. 465

66 N.J.L. 392

FRENCH

v. MAYOR, ETC., OF CITY OF MILLVILLE.

Supreme Court of New Jersey.

June 10, 1901.

(Syllabus by the Court.)

Action by Thomas E. French, receiver of the Millville Mutual Marine & Fire Insurance Company, against the mayor and common council of the city of Millville. Demurrer to declaration overruled.

Argued February term, 1901, before DEPUE, C. J., and COLLINS, HENDRICKSON, and DIXON, JJ.

Samuel H. Richards and Thomas E.

French, for plaintiff. Louis H. Miller, for defendant.

DIXON, J. The declaration in this case consists of three counts, the first and second being special, and the third common. The defendant had filed a single demurrer to the first and second, the validity of which is the question now before us. If either count is sufficient against the causes specified by the defendant, the demurrer fails. The second count sets forth the incorporation of the Millville Mutual Marine & Fire Insurance Company by an act of our legislature approved March 8, 1859, and found in P. L. 1859, p. 144; the provisions of its charter that persons insuring with the corporation should thereby become members thereof during the period they remained insured, and before receiving a policy should deposit their promissory note for such sum of money as should be determined upon by the directors, such note to be paid at such time and in such manner as the by-laws might determine; the provisions of the by-laws that assessments might be made on such notes for losses and money borrowed for the purpose of cashing losses, which assessments should include incidental expenses, expenses of collecting assessment, and uncollectible claims, and that notice of such assessment should be given by publication, etc. (stating the mode); that on a bill filed in chancery for that purpose the said company was proved to be insolvent, and Thomas Whitaker was appointed receiver thereof on September 28, 1885; that before such appointment the defendant was the holder of eight policies of fire insurance in the company, and had given to the company therefor eight premium notes for sums stated, payable to said company in such proportions and at such times as might, agreeably to the charter, be required; that, in accordance with the provisions of the charter and by-laws, the said receiver made an assessment upon each of said premium notes for sums stated, which assessment was entirely for fire losses that occurred during the life of said policies and certain necessary expenses, and was only for their respective proportionate shares thereof; that, in accordance with the by-laws, the said receiver caused notice of the said assessment to be published, etc. (stating the mode, as required by the by-laws); that on July 13, 1899, the present plaintiff was, by the chancellor, appointed receiver instead of said Thomas Whitaker; and that the time for payment of said assessment is passed. Under the decision in Meley v. Whitaker, 61 N. J, Law, 602, 40 Atl. 593, these facts are, in substance, sufficient against every objection specified in the causes of demurrer respecting this count, except the first and last. The first objection is that the making of these promissory notes was ultra vires, the city having no authority to make the same, or to become a member of a private corporation; and under this the defendant urges: (1) That the charter of the insurance company permits only natural persons to become members of it; (2) that municipalities are not...