Ins. Co. of N. Am. v. Welch, Case Number: 7581

CourtSupreme Court of Oklahoma
Writing for the CourtHARDY, J.
Citation49 Okla. 620,154 P. 48,1915 OK 914
Decision Date09 November 1915
Docket NumberCase Number: 7581
PartiesINSURANCE CO. OF NORTH AMERICA et al. v. WELCH, Ins. Com'r, et al.

1915 OK 914
154 P. 48
49 Okla. 620

INSURANCE CO. OF NORTH AMERICA et al.
v.
WELCH, Ins.
Com'r, et al.

Case Number: 7581

Supreme Court of Oklahoma

Decided: November 9, 1915


Syllabus

¶0 1. CONSTITUTIONAL LAW -- Due Process -- Equal Protection--Power to Contract--Statutory Regulations--State Insurance Board. Chapter 174, Sess. Laws 1915. p. 340, creating a State Insurance Board and providing for the regulation and control of rates of premiums on insurance, and for other purposes therein specified, is not in violation of any rights of the companies affected thereby doing business in this state secured to them by the Fourteenth Amendment to the Constitution of the United States, and is within the legitimate police power of the state.

2. INSURANCE--Power to Regulate--State Insurance Board. The business of insurance affected by the provisions of said act is of such nature and affected with such a public interest as to justify legislative regulation thereof and of the rates charged by the companies engaged in such business.

3. CONSTITUTIONAL LAW -- Legislative Power -- Delegation--State Insurance Board. It is within the power of the Legislature to create a State Insurance Board, and to require every fire, tornado, and plate glass insurance company and every insurance company granting insurance against the liability of employers to file with said board a schedule of rates charged by it for such risks, and to prohibit a change in such rates except after ten days' notice to said board of such contemplated change, and authorizing said board, when it shall determine that any rate is excessive or unreasonably high, or that said rate is inadequate to the safety or soundness of the company granting the same, to direct said company to file a higher or lower rate, commensurate with the risk, and further requiring that in every case the rate shall be reasonable, when provision is made for a review of the orders of said board by the courts.

4. INSURANCE--Statute Creating State Insurance Board--Validity. Section 174, Sess. Laws 1915, p. 340, is not violative of the provisions of sections 22, 23, and 24 of article 6 of the Constitution, creating the Insurance Department and the office of Insurance Commissioner, nor does such act deprive the Insurance Commissioner of any powers or duties conferred upon him by the Constitution.

5. CONSTITUTIONAL LAW--Construction--Grant of Powers--Constitutionality of State Insurance Board. The grant to the Legislature of specific authority by section 19, art. 9, of the Constitution to vest in the Corporation Commission additional powers and duties in connection with the visitation, regulation, or control of corporations, or with prescribing and enforcing rates and charges to be observed in the conduct of any business, where the state has the right to prescribe the rates and charges in connection therewith, does not deprive the Legislature of its power to regulate and control such matters or to create the State Insurance Board and vest it with the powers enumerated in said chapter 174, Sess. Laws 1915.

6. CONSTITUTIONAL LAW--Constitutionality--Determination by Courts. This court will not pass upon the constitutionality of an act of the Legislature or of any of its provisions until there is presented a proper case in which it is made to appear that the person complaining is entitled to the benefits of said act or about to be subjected to some of its burdens or penalties.

7. CONSTITUTIONAL LAW--Equal Protection--Insurance--Statutory Regulations--State Insurance Board. Exempting domestic mutual fire insurance companies and reciprocal associations and mutual insurance companies and reciprocal associations doing business in this state from the provisions of said act does not render such legislation invalid as to other insurance companies, as denying them the equal protection of the laws.

8. STATUTES--Title and Subject-Matter--State Insurance Board. The title of the act is sufficiently comprehensive to embrace the various provisions thereof.

9. INJUNCTION--Adequate Remedy at Law--Right of Appeal--Order of State Insurance Board. Provision having been made for an appeal to this court from any regulation, order, or rate adopted by said board, said provision gives a speedy and adequate remedy, and an injunction will not lie to restrain said board from proceeding in a matter within its lawful jurisdiction.

Error from District Court, Oklahoma County; Edward Dewes Oldfield, Judge.

Action by the Insurance Company of North America and others against A. L. Welch, Insurance Commissioner, and others. Judgment for defendants, and plaintiffs bring error. Affirmed.

Burwell, Crockett & Johnson, for plaintiffs in error

S. P. Freeling, Atty. Gen., and J. H. Miley and Smith C. Matson, Asst. Attys. Gen., for defendant in error

HARDY, J.

¶1 Plaintiffs in error brought suit in the district court of Oklahoma county, on behalf of themselves and others similarly situated, against defendants in error, seeking to enjoin defendants in error, as the State Insurance Board, from enforcing the provisions of an act of the Legislature, referred to as House Bill No. 70, being chapter 174, Sess. Laws 1915, p. 340, which created a State Insurance Board, prescribed the powers and duties thereof, and prescribed certain regulations in reference to the conduct of insurance within this state. The parties will be referred to as they appeared in the trial court.

¶2 Plaintiffs alleged that the Insurance Company of North America was an insurance company duly incorporated under the laws of the State of Pennsylvania, and that it had complied with all the laws of this state, and was licensed to do business within the state during the year 1915; that plaintiff Ludlow was its general agent, having charge of its business within this state, and that plaintiff McDaniels was the local agent of said company in the city of Norman, Okla. The petition then alleged the passage of House Bill No. 70, creating the State Insurance Board, to be composed of the Insurance Commissioner, Fire Marshal, and a third member to be appointed by the Governor, and that in pursuance thereof the Governor had appointed Hon. W. R. Samuels as secretary of said insurance board, which board had thereafter organized and promulgated certain rules and regulations for the government of said board and the insurance companies and their agents doing business within this state. The case came on for hearing on the application of plaintiffs for a temporary injunction, on the 7th day of August, 1915, at which time evidence was introduced, when the court denied the temporary injunction, and plaintiffs bring error.

¶3 The petition attacks the validity of said House Bill No. 70 on the ground that it is in violation of the Constitution of the United States and the Constitution of this state, an unwarranted interference with the power of plaintiffs to contract, a deprivation of property without due process of law, and a denial of the equal protection of the laws. Counsel in their brief and oral argument concede the right of the state to regulate the rates charged by insurance companies, but do not concede the validity of other regulations prescribed by the act.

¶4 The power of the state to regulate the business of insurance has frequently been before the courts in recent years. This question was presented to the Circuit Court of the United States for the District of Kansas in the case of German Alliance Ins. Co. v. Barnes (C. C.) 189 F. 769. The Legislature of Kansas had passed a law conferring upon the Superintendent of Insurance of that state authority very similar to the authority conferred upon the State Insurance Board by House Bill No. 70. The Kansas act was in many respects similar to House Bill No. 70, and some of its sections were identical with those of the latter act. The plaintiff in that case sought to enjoin the Superintendent of Insurance from proceeding in or enforcing the provisions of said act, and urged as a reason therefor that said act was an interference with the right of plaintiff to contract, and that it was an appropriation by the state of private property within the prohibition of the Fourteenth Amendment, and that it was beyond the police power of the state to regulate the rates charged by insurance companies doing business in that state. This contention was denied by the court, and the injunction refused; the court being of the opinion that said act was not subject to the objections enumerated. The case was appealed to the Supreme Court of the United States, and in German Alliance Ins. Co. v. Lewis, 233 U.S. 389, 34 S. Ct. 612, 58 L. Ed. 1011, L. R. A. 1915C, 1189, the judgment of the Circuit Court was affirmed, and Mr. Justice McKenna, in a very learned opinion, set at rest the authority of the state in the exercise of its police power to regulate the business of insurance and the rates and charges exacted by insurance companies in the conduct of their business.

¶5 In Citizens' Insurance Co. v. Clay (D. C.) 197 F. 435, in the United States District Court for the Eastern District of Kentucky, an act of the Legislature of that state was under review which created a State Insurance Board empowered to require certain data to be furnished by companies doing business in the state, and therefrom to establish rates for such companies. The court there stated the principle that the business of insurance was one which from its character was of a quasi public nature and subject to reasonable state regulations, and that said act was not violative of the federal Constitution as depriving plaintiff of its property without due process of law, or denying it the equal protection of the laws.

¶6 The Supreme Court of Nebraska, in State ex rel. Martin v. Howard, 96 Neb. 278, 147 N.W. 689, following the opinion of the Circuit Court for the Eastern District of Kansas and the Supreme Court of the United States in German Alliance Ins. Co. v. Lewis, supra, held that an act of the...

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15 practice notes
  • Idaho Gold Dredging Company v. Balderston, 6470
    • United States
    • United States State Supreme Court of Idaho
    • 25 Enero 1938
    ...Coal Co. et al. v. Trapp, supra, Ex parte Ambler, 11 Okla. Crim. 449, 148 P. 1061, Insurance Co. of North America v. Welch, 49 Okla. 620, 154 P. 48, Ann. Cas. 1918E, 471, Missouri K. & T. Ry. Co. v. Meyer, 204 F. 140, and Geren v. Courts Trading Co., 99 Okla. 170, 226 P. 369. That the exige......
  • Siloam Springs Hotel, LLC v. Century Sur. Co., No. 114,872
    • United States
    • Supreme Court of Oklahoma
    • 22 Febrero 2017
    ...1072, 1076 (7th Cir. 1970), cert. denied, 402 U.S. 983, 91 S.Ct. 1658, 29 L.Ed.2d 148 (1971).3 Insurance Co . of North America v. Welch , 1915 OK 914, ¶ 8, 49 Okla. 620, 154 P. 48.4 United States Department of the Treasury v. Fabe , 508 U.S. 491, 113 S.Ct. 2202, 124 L.Ed.2d 449 (1993).5 Sun......
  • C. C. Julian Oil & Royalties Co. v. Capshaw, Case Number: 21640
    • United States
    • Supreme Court of Oklahoma
    • 14 Octubre 1930
    ...confers non-delegable powers on the Corporation Commission. See Ex parte Tindall, 102 Okla. 192, 229 P. 125: Insurance Company v. Welch, 49 Okla. 620, 154 P. 48; Quinton Relief Oil & Gas Co. v. Corporation Commission, 101 Okla. 164, 224 P. 156: Plymouth Coal Co. v. Commonwealth of Penn., 23......
  • Bond v. Phelps, Case Number: 33240
    • United States
    • Supreme Court of Oklahoma
    • 30 Marzo 1948
    ...unconnected, or incongruous as to relate to more than one subject within the meaning of the Constitution. Insurance Co., etc., v. Welch (49 Okla. 620) 154 P. 48; Noble State Bank v. Haskell, 22 Okla. 48, 97 P. 590; State ex rel. Caldwell v. Hooker, 22 Okla. 712, 98 P. 964; City of Pond Cree......
  • Request a trial to view additional results
15 cases
  • Idaho Gold Dredging Company v. Balderston, 6470
    • United States
    • United States State Supreme Court of Idaho
    • 25 Enero 1938
    ...Coal Co. et al. v. Trapp, supra, Ex parte Ambler, 11 Okla. Crim. 449, 148 P. 1061, Insurance Co. of North America v. Welch, 49 Okla. 620, 154 P. 48, Ann. Cas. 1918E, 471, Missouri K. & T. Ry. Co. v. Meyer, 204 F. 140, and Geren v. Courts Trading Co., 99 Okla. 170, 226 P. 369. That the exige......
  • Siloam Springs Hotel, LLC v. Century Sur. Co., No. 114,872
    • United States
    • Supreme Court of Oklahoma
    • 22 Febrero 2017
    ...1072, 1076 (7th Cir. 1970), cert. denied, 402 U.S. 983, 91 S.Ct. 1658, 29 L.Ed.2d 148 (1971).3 Insurance Co . of North America v. Welch , 1915 OK 914, ¶ 8, 49 Okla. 620, 154 P. 48.4 United States Department of the Treasury v. Fabe , 508 U.S. 491, 113 S.Ct. 2202, 124 L.Ed.2d 449 (1993).5 Sun......
  • C. C. Julian Oil & Royalties Co. v. Capshaw, Case Number: 21640
    • United States
    • Supreme Court of Oklahoma
    • 14 Octubre 1930
    ...confers non-delegable powers on the Corporation Commission. See Ex parte Tindall, 102 Okla. 192, 229 P. 125: Insurance Company v. Welch, 49 Okla. 620, 154 P. 48; Quinton Relief Oil & Gas Co. v. Corporation Commission, 101 Okla. 164, 224 P. 156: Plymouth Coal Co. v. Commonwealth of Penn., 23......
  • Bond v. Phelps, Case Number: 33240
    • United States
    • Supreme Court of Oklahoma
    • 30 Marzo 1948
    ...unconnected, or incongruous as to relate to more than one subject within the meaning of the Constitution. Insurance Co., etc., v. Welch (49 Okla. 620) 154 P. 48; Noble State Bank v. Haskell, 22 Okla. 48, 97 P. 590; State ex rel. Caldwell v. Hooker, 22 Okla. 712, 98 P. 964; City of Pond Cree......
  • Request a trial to view additional results

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