Griffin v. Implement Dealers' Mut. Fire Ins. Co.

• Decision Date: 25 February 1932
• Docket Number: No. 5956.,5956.
• Citation: 241 N.W. 75,62 N.D. 21
• Parties: GRIFFIN v. IMPLEMENT DEALERS' MUT. FIRE INS. CO.
• Court: North Dakota Supreme Court

62 N.D. 21

241 N.W. 75

GRIFFIN

v.IMPLEMENT DEALERS' MUT. FIRE INS. CO.

No. 5956.

Supreme Court of North Dakota.

Jan. 22, 1932.

Rehearing Denied Feb. 25, 1932.

Syllabus by the Court.

A mutual fire insurance company, a domestic corporation, having no established place of business in the county in which the action is brought, no resident agent nor representative therein, sending no authorized agent there for the purpose of securing business, transacting business therefrom in the main by having applications for policies mailed to its headquarters in another county, examined therein and policies issued therefrom, is not transacting business in such county within the purview of subdivision 6 of section 7415 of the Supp., even though policies may be issued to residents therein, premiums thereon sent to the headquarters, and losses thereunder adjusted, particularly when the cause of action did not originate in such county.

Appeal from District Court, Hettinger County; Thomas H. Pugh, Judge.

Action by F. R. Griffin against the Implement Dealers' Mutual Fire Insurance Company. From an order denying its motion for a change of the place of trial, defendant appeals.

Order reversed.

Geo. A. Bangs, of Grand Forks, for appellant.

Jacobsen & Murray, of Mott, for respondent.

BURR, J.

The defendant, a domestic corporation with office and place of business in Grand Forks county, issued to the plaintiff a policy of insurance against fire on a stock of goods in Redelm, S. D. The goods were burned and the plaintiff brought action in Hettinger county to recover on the policy, alleging that the defendant, “at all times herein named, transacted and is still transacting business in the county of Hettinger.” The defendant moved for a change of venue to the county of its residence. The court denied the motion, and the defendant appeals.

Even if the action be not brought in the proper county, “the action may, notwithstanding, be tried therein, unless the defendant before the time for answering expires demands in writing that the trial be had in the proper county. * * *” Section 7418 of the Compiled Laws. Hence it was proper for the plaintiff to bring his action in Hettinger county and the same is triable therein, subject to the right of the defendant to a change of venue.

The issue involves the construction of section 7415 of the Supplement 1925 and section 7417 of the Compiled Laws. Section 7416 requires certain actions to be brought “where the cause arose,” but this section is not involved here. With this section eliminated, section 7417 requires an action to “be tried in the county in which the defendant or some of the defendants reside at the time of the commencement of the action,” except in the cases specified in section 7415 of the Supplement and section 7416 of the Compiled Laws.

Section 7415 specifies what cases shall “be tried in the county in which the subject of the action or some part thereof is situated,” and in subdivision 5 says: “All actions brought on a policy of insurance to recover for loss or damage to the property insured shall be tried in the county or judicial subdivision where such property is situated at the time of its loss or damage.” As the property was situated in South Dakota at the time of the loss, this subdivision does not apply. Thus the “proper county” in which the plaintiff should bring his action is Grand Forks county, unless the amendment to section 7415, set forth in chapter 3 of the Laws of 1919, applies.

This amendment added subdivision 6 to section 7415, and the amended section is known as section 7415 of the supplement. This subdivision says: “All actions against any domestic corporation shall be tried in any county or judicial subdivision designated in the complaint and in which the defendant corporation transacts business.”

Plaintiff says: “Domestic corporations cannot insist upon a change of venue to the county of its residence if the plaintiff designates as a place of trial some county in which the defendant ‘transacts business.”’

Defendant says this subdivision 6 is not germane to the law sought to be amended; that the amendment violates section 61 of the Constitution of this state; that to permit suits against domestic corporations in any county of the state in which it transacts business discriminates against domestic corporations in favor of foreign corporations, and thus such discrimination infringes the Fourteenth Amendment to the Constitution of the United States; and that the record shows clearly the defendant does not transact business in Hettinger county, and in particular that this action does not arise out of any business transacted in Hettinger county.

It is not necessary for us to pass upon the constitutionality of this subdivision. Unless the domestic corporation “transacts business” in Hettinger county, a change of venue to Grand Forks county must be granted.

Defendant's application for change shows that it is a mutual association organized under the provisions of section 4870 et seq., Compiled Laws 1913; that the corporation has no office or place of business either local or general except in Grand Forks and “never has had an office or place of business of any kind in the county of Hettinger and that it has not now and never has had an agent, representative, servant or employee located or stationed, either with or without an office, in the county of Hettinger for the purpose of transacting or carrying on any business for or on behalf of said defendant or otherwise,” except that it accepts applications for insurance from residents of Hettinger county, has members residing therein, has in force a number of insurance policies covering property situated in Hettinger county which are renewed from year to year, and whatever losses occur in Hettinger county are adjusted there by some representative of the company.

Plaintiff furnished affidavits to the effect that the general manager had been in Hettinger county and personally solicited insurance and received therein premiums on policies; that “a soliciting agent” solicited written applications in Hettinger county, which applications were made and delivered in Hettinger county, and thereafter the applicants received through the mail the policies of insurance issued upon the applications.

The general manager denies that he had ever been in Hettinger county at any time, says he never solicited any policies from any one therein, and that if any one did solicit insurance he did so because of his interest in the company.

The application for change of venue shows clearly that the defendant is a domestic corporation having membership scattered throughout the state. Applications for insurance, however secured, are mailed to the home office, are examined there, and if found satisfactory are accepted, thereupon policies of insurance are prepared in Grand Forks county and mailed to the successful applicants upon payment of the premiums which generally are sent by mail to the home office. Being a mutual company, all members have more or less interest in extending business, and a large portion of the business is received through the voluntary action of the members. When a loss occurs, some one representing the company visits the scene of the fire, the loss is adjusted, and if the adjustment is satisfactory to the company in Grand Forks the loss is paid therefrom; most of the business being transacted by mail. There are no resident agents in any county of the state except that at “Beach, Devils Lake, Hope, Pembina, LaMoure and Fargo there is a part time representative of the defendant with authority and duties local thereto to advertise the company and to promote and encourage good will toward it.”

“Transaction of business” and “doing business” are to be considered as synonymous terms. Hart-Parr Co. v. Robb-Lawrence Co. et al., 15 N. D. 55, 106 N. W. 406. But “transaction of business” does not mean a single isolated action. See Potter v. Bank, 5 Hill (N. Y.) 490;Suydam et al. v. Morris Canal & Banking Co., 6 Hill (N. Y.) 217;Goode et al. v. Colo. Inv. Co., 16 N. M. 461, 117 P. 856;People v. Whiting, 68 Misc. Rep. 306, 123 N. Y. S. 769;Alpena Portland Cement Co. v. Jenkins & Reynolds Co., 244 Ill. 354, 91 N. E. 480;Finch & Co. v. Zenith Furnace Co., 245 Ill. 586, 92 N. E. 521;Padrick v. Kiser Co., 33 Ga. App. 15, 124 S. E. 901;Parker v. Wear et al. (Mo. Sup.) 230 S. W. 75;General Conf., etc. v. Berkey et al., 156 Cal. 466, 105 P. 411;Vermont Farm Mach. Co. v. Ash, 23 N. M. 647, 170 P. 741;Hildreth Granite Co. v. Freeholders, etc., 87 N. J. Eq. 316, 100 A. 158;Syndicate Clothing Co. v. Garfield, etc., 204 Iowa, 159, 166, 214 N. W. 598, 601. The term implies continuity of business dealings, and such arrangements whereby this continuous carrying on of business may be fostered. It contemplates a series...