Kafka v. Wilkinson

• Decision Date: 23 March 1904
• Citation: 57 A. 617,99 Md. 238
• Parties: KAFKA v. WILKINSON, Insurance Com'r, et al.
• Court: Maryland Court of Appeals

57 A. 617

99 Md. 238

KAFKA v. WILKINSON, Insurance Com'r, et al.

Court of Appeals of Maryland

March 23, 1904

Appeal from Circuit Court of Baltimore City; John J. Dobler, Judge.

Suit by Joseph Kafka and others against Lloyd Wilkinson, Insurance Commissioner of Maryland, and others. From a decree dismissing the bill, plaintiffs appeal. Reversed.

Argued before McSHERRY, C.J., and FOWLER, BRISCOE, BOYD, PAGE PEARCE, SCHMUCKER, and JONES, JJ.

Wm. S Bansemer, for appellants.

Foster & Foster, for appellees.

JONES J.

This is an appeal from a decree of the circuit court of Baltimore City. The appellants, as plaintiffs below, filed in that court, on the 8th of October, 1903, their bill of complaint making defendants thereto the Monumental Mutual Life Insurance Company of Baltimore City, a corporation existing under the laws of the state of Maryland, the I.O.O.F. Mutual Life Insurance Society of Pennsylvania, a corporation under the laws of Pennsylvania, Murray Vandiver, Treasurer of the state of Maryland, and Lloyd Wilkinson, Insurance Commissioner of the state of Maryland. It will not be necessary here to set out in detail the allegations of the bill. The plaintiffs, after showing their interest in the suit they were inaugurating by reason of having contracts of insurance with the Maryland corporation named as defendant therein, charged that in the month of March, 1903, the attention of the Insurance Commissioner of the state was called to the fact that said corporation was not conducting business in compliance with the laws of the state, and "had rendered itself liable to the inquisitorial powers of said commissioner"; that, against the strenuous protest of said corporation, the commissioner made an investigation as to the financial condition of said corporation, with the result of finding a large deficiency in its assets; that about the time of this discovery the corporation, with a view to prevent or evade proceedings to wind it up and enforce a forfeiture of its charter, filed a bill in equity to enjoin the Insurance Commissioner from proceedings against it, to which bill the Commissioner demurred, that a hearing in the case so instituted has been delayed; and in the meantime the Maryland corporation, defendant, with the object of escaping the effect of a legal investigation of its business methods, has, "without the consent or participation of policy holders," entered into a contract with the Pennsylvania company, defendant, whereby, among other things that the plaintiffs complained of as affecting their interests, all the funds and assets of the said Maryland corporation will be transferred to the Pennsylvania corporation, defendant, and the same will be thus removed from this state and beyond the jurisdiction of its courts. These assets consist chiefly, it is alleged, of $100,000 deposited, in the way of securities, with the Treasurer of Maryland. It is further alleged that the said Maryland corporation is wholly insolvent; and the prayer of the bill is that it may be enjoined from carrying out the contract referred to herein, and from making any transfer of the funds belonging to the same, and that a receiver be appointed to take charge of the funds and assets to be distributed under the authority of the court, and that the corporation may be dissolved. The Insurance Commissioner was made a party to the bill in accordance with Acts 1902, p. 453, c. 338. He demurred to the bill, and, as the grounds of the demurrer, alleged that the said act provided, by section 122b, that "no order, judgment or decree providing for an accounting or enjoining, restraining or interfering with the prosecution of the business of any domestic insurance corporation, or appointing a temporary or permanent receiver thereof, shall be made or granted otherwise than upon complaint or other proceedings instituted by the Insurance Commissioner in accordance with the provisions of sub-section 7th of section 122, of this article, except in an action by judgment creditor, or in proceedings supplementary to execution." The demurrer thus went to the denial of the right of the plaintiffs to bring their bill; and, having been sustained by the court below, they submitted to a decree dismissing their bill, from which the present appeal was taken.

The contention of the appellants is that this section 122b is not a part of Acts 1902, p. 453, c. 338, but is void under that clause of section 29, art. 3, of the Constitution which provides that "every law enacted by the General Assembly shall embrace but one subject, and that shall be described in its title," in that the matter of legislation embraced in this section is not sufficiently described or indicated by the title of the said act. The title of the act in question reads as follows: "An act to repeal sections 122 and 128 of article 23 of the Code of Public General Laws, title 'Corporations,' sub-title 'Insurance,' and to re-enact the same with amendments; and to add an additional section to said article, to be known as section 122A; and to repeal section 143EI of said article." The body of the act repeals sections 122 and 128 of article 23, and re-enacts them both as they are to read in the Code, and then following these is the enactment of the new section 122a, in these words: "And be it further enacted, that an additional section be added to said article 23 of the Code of Public General Laws, title 'Corporations,' sub-title 'Insurance,' to be known and designated as section 122A, the same to read as follows:" (Then follows the section thus enacted, as it is to read in the Code.) Following this, not preceded by an enacting clause, but simply by the word, figures, and letter "Section 122B," is the section which has been set out as the ground of the demurrer to the bill of the appellants. And then follows: "And be it further enacted that section 143EJ be and the same is hereby repealed."

The provision of the Constitution with which it is here claimed the foregoing legislation, as respects section 122b, is in conflict, has been the subject of consideration in its application to acts of the Legislature in a number of cases by this court. It has received a liberal...