Henderson v. McMaster

• Decision Date: 27 April 1916
• Docket Number: 9388.
• Citation: 88 S.E. 645,104 S.C. 268
• Parties: HENDERSON v. MCMASTER, INS. COM'R, ET AL.
• Court: South Carolina Supreme Court

88 S.E. 645

104 S.C. 268

HENDERSON v. MCMASTER, INS. COM'R, ET AL.

No. 9388.

Supreme Court of South Carolina

April 27, 1916

Original application for an injunction by David B. Henderson against Fitz H. McMaster, Insurance Commissioner, and another. Petition dismissed, and injunction refused.

T Moultrie Mordecai and A. T. Smythe, both of Charleston, for petitioner.

Thos H. Peeples, Atty. Gen., and W. H. Townsend, of Columbia, for respondents.

FRASER J.

This is a case of very great importance. It is also a case in which there is great popular interest. The case demands prompt decision. It should not be decided hastily, but without unnecessary delay. In view of the fact that there is such popular interest, the decision should be couched in such terms that the people who are not trained lawyers can understand the reason of the decision, without unnecessary citation of authority. Fundamental principles are sufficient. The Legislature of this state, at its recent session (1916) passed an act, entitled

"An act to prevent fire insurance companies or associations or partnerships doing a fire insurance business in this state to enter into any compact or combination with any other fire insurance companies, associations or partnerships."

This act gives the insurance commissioner of this state power to "review" rates of insurance, and provides punishment for false affidavits therein required. The petitioner comes into this court in its original jurisdiction, and alleges that he is a citizen of this state; that prior to the enactment of this statute he was doing an insurance business in this state, as the agent of the Liverpool & London & Globe Insurance Company of Liverpool, England, and that by reason of the passage of this statute, the said insurance company was compelled, by reason of the provisions of said act, to cease to do business in this state; that the petitioner has, by reason thereof, been deprived of his business; that he knows no other business. He asks that the insurance commissioner be enjoined from proceeding to carry out the provisions of the act. The petitioner alleges that the act is unconstitutional in certain particulars. The insurance commissioner and Attorney General, who also has some duties to perform under the act and is a party hereto, demur to the petition. That is to say, these state officers come into this court and allege that, even admitting all the facts pleaded in the petition, still the petitioner has not shown that he is entitled to the injunction asked for. A copy of the act is set out in the case. It is not certified to, but is assumed to be a true copy of the act. The statute is alleged to be unconstitutional:

I. In that "the state warehouse commissioner is authorized to take any and all kinds of insurance on all classes of property, at any rates he may see fit, while the petitioner cannot accept any risk, and therefore is deprived of his property without due process of law, and is denied the equal protection of the law." A demurrer admits facts, but not constructions of statutes or conclusions of law or fact.

No such power is given to the state warehouse commissioner. The rule (no citation is necessary) in the construction of a statute is that general words--and it makes no difference how general--will be confined to the subject treated of. So here, the language, however general, would confine the insurance procured by or through the warehouse commissioner, to insurance procured by or through him in his business as warehouse commissioner.

It is also objected that the mill mutuals and factory insurance associations are exempted and this is said to be an unjust discrimination. It is not unlawful to classify business and provide different rules for the different classes. That insurance in which one party is insurer and the other the insured is not in the same class with mutual insurance, in which a person is both insurer and insured.

If, however, these two provisions should be held to be unconstitutional, it would not affect this case, because the provisions are separable, and the rule is that the unconstitutional exception to a general provision fails, and the body of the act stands. In other words, if it is unconstitutional to exempt the state warehouse commissioner and the mill mutuals, then the business by and through the warehouse commissioner and the mill mutuals are not exempt from the provisions of the act.

II. It is next objected that the act is unconstitutional, in that it confers both legislative and judicial powers on the insurance commissioner, and the Constitution provides that these powers shall be kept separate. This act does not confer either power. The duties of the insurance commissioner are not legislative or judicial, but merely ministerial. Carolina Glass Co. v. State, 87 S.C. 270, 69 S.E. 391. The right of the state to review insurance rates is not in issue.

III. The next objection is to the title of the act,...