Independence Ins. Co. v. Independent Life & Acc. Ins. Co.
| Decision Date | 27 September 1950 |
| Docket Number | 16414. |
| Parties | INDEPENDENCE INS. CO. v. INDEPENDENT LIFE & ACC. INS. CO., a Florida Corporation. |
| Court | South Carolina Supreme Court |
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Lee Guest, Jacksonville, Fla., Mozingo & Watts Darlington, McKay & McKay, and C. B. Elliott, all of Columbia, for appellant.
Brown & Jefferies, Barnwell, and Williams & Henry Greenville, John M. Daniel, Atty. Gen., T. C. Callison, Asst. Atty. Gen., for respondent.
Independence Insurance Company was incorporated in this state in 1930 and has been regularly licensed each subsequent year by the State Insurance Commissioner. Originally it issued life, health and accident policies, but in December 1938 it reinsured its life insurance business with another company and thereafter confined its activity to the other lines. That transaction is referred to in the record as a sale of its life business. Prior to that the annual premium income was nearly a half million dollars but currently it has been less than $5000 and declining each year; only two persons are licensed as its agents and in recent years the company has issued no new policies. However, it continues to operate and an official testified that the company plans to expand in the accident and health field.
Prior to July 30 1947, The Independent Life and Accident Insurance Company, a Florida corporation also about twenty years old, applied to the commissioner for admission to do business in this state and was duly licensed on that date since which it has made substantial progress here and at the time of the complaint which gave rise to this proceeding had 34 agents, which had risen to 158 by March 1948. In the half year of 1947 the premium income in this state was $30,325.45. The record for appeal does not include later figures or for any full year but they are publicly available in the annual reports of the commissioner.
On September 24, 1947 the president of Independence Insurance Company addressed a letter to the commissioner complaining at the former licensing of the Florida company because of alleged confusion which had resulted from the similarity of names. The commissioner gave notice to both companies of a hearing which he held on March 8, 1948. He was attended by officials and counsel for both companies but the representatives of the Florida company appeared specially to object to the jurisdiction of the commissioner, the grounds of which were filed in writing, and upon decision to go forward with the hearing, they withdrew. One of the grounds was as follows: 'Applicant (appellant) is a foreign insurance company now licensed to do business in the State of South Carolina, therefore comes within the provisions of Section 108 of Act No. 232 of the Acts of 1947 reading: 'nothing herein contained shall apply to foreign insurance companies now domesticated and licensed in this State.' (It was preserved in the court on review by proper exception.) The commissioner took the testimony of the vice-president and treasurer (one person) of Independence Insurance Company, which supported the claim of confusion, mix-up in the mails, etc.
Thereafter, on March 24, 1948, the commissioner issued his order whereby he refused to renew the license of the Florida company for the license year commencing April 1, 1948, unless it should change its name so that it should not be nearly similar to that of the objecting company or other companies licensed in the state. The matter was presented to the Court of Common Pleas for Darlington County which, upon the record and upon the affidavit of counsel, stayed the enforcement of the commissioner's order and preserved the prior status pending final adjudication. The proceedings were transferred by consent and for convenience to the Court of Common Pleas for Richland County. Evidence was there adduced in behalf of the appellant which consisted mainly of the records in the office of the commissioner which related to the activities and extent of business of the contending companies which, as already mentioned, are available in the published reports of the department. Court review of orders of the commissioner is provided in 1948 Code Supp. p. 376, sec. 7952. Part (3) of the cited section is as follows: 'The Court shall have jurisdiction to review the facts and the law and to affirm, modify or to set aside the order or decision of the commissioner and to restrain the enforcement thereof.' There was controversy in the court with reference to the admissibility of evidence which, in our view, is of no moment.
The court upheld the action of the commissioner, whence this appeal in which we find it necessary to consider only the second exception, as follows: 'The Court erred in holding that the Insurance Commissioner, after licensing the Appellant, a foreign insurance company, had the right to refuse to relicense it under the very law whose proviso clearly denied the exercise of such right in the circumstances existing herein.' It is a repetition of appellant's timely objection to the asserted power of the commissioner, which is quoted ante. Application of the governing statute requires sustention of the stated exception, as will be seen and this will dispose of the matter. Authority need not be cited for the observation that the power of the Commissioner is derived solely from the statutes. To them alone we look for his authority and jurisdiction. However, see People ex rel. Traders Fire Insurance Company v. Van Cleave, 183 Ill. 330, 55 N.E. 698, 47 L.R.A. 795, which exemplifies the necessity of plain statutory authority for action of the nature of that here under review. Examination of our law discloses not only lack of authority in the commissioner but an express bar to the action which he attempted to take.
There was approved on Feb. 25, 1944, No. 385, 43 Stat. 1191, the following act of the legislature: 'no foreign insurance corporation shall be domesticated or licensed to do business in South Carolina when the name thereof is identical with that of any active insurance corporation previously domesticated, licensed or chartered to do business in the State and which has engaged in business therein for one year or more, nor shall any such insurance corporation be domesticated or licensed to do business in said State when the name thereof is so nearly similar to any such said corporation as to lead to confusion and uncertainty; Provided however that nothing herein contained shall apply to foreign insurance corporations now domesticated and licensed in this State.'
In 1947 the legislature enacted an extensive Insurance Code which is published in the 1948 Supplement to the Code of 1942 and is there contained in sections 7936-8111, inclusive, pages 371-491, inclusive. The original act was No. 232 of 1947, 45 Stat. 322. Section 108 of Art. 1, of the original act, now code section 8043, 1948 Supplement, p. 408, is as follows:
It is noted that the foregoing lack identity because of the material addition in this section of the act of 1947, now Code, sec. 8043, which is enclosed in the added parentheses in our quotation of it. This is of interest in connection with the determination hereinafter of whether the 1947 legislative action was but a re-enactment of the act of 1944. It was not, as is seen.
In sections 1 and 3 of Article 13 of the act of 1947, approved May 12, 1947, 4k Stat. 472, 473, are provisions expressly repealing certain former codifications of the insurance law of the state, a general repeal of inconsistent laws, and an effective date of the act as October 1, 1947.
The lower court disposed of this important point, upon which we find that the case properly turns, quite briefly, as follows: The text quotation is applicable to a simple re-enactment which is not what took place in this instance. Indeed, it is offset by the following from 50 Am.Jur. 483: 'The inclusion of a statute in a code has been held not to operate as a re-enactment thereof.' It is manifest that by the Act of 1947 the legislature intended to wipe the slate clean of insurance laws and enact a complete code upon the subject. The title begins, 45 Stat. 322: 'An Act To Provide An Insurance Code For The...
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