Montana Land Title Ass'n v. First Am. Title

• Decision Date: 25 August 1975
• Docket Number: No. 12942,12942
• Citation: 539 P.2d 711,167 Mont. 471,32 St.Rep. 874
• Parties: MONTANA LAND TITLE ASSOCIATION, a Montana Nonprofit Corporation, Plaintiff and Respondent, v. FIRST AMERICAN TITLE and Escrow of Billings et al., Defendants and Appellants.
• Court: Montana Supreme Court

Page 711

539 P.2d 711

167 Mont. 471

MONTANA LAND TITLE ASSOCIATION, a Montana Nonprofit Corporation, Plaintiff and Respondent, v. FIRST AMERICAN TITLE and Escrow of Billings et al Defendants and Appellants.

No. 12942.

Supreme Court of Montana.

Submitted June 18, 1975.

Decided Aug. 25, 1975.

Rehearing Denied Sept. 12, 1975.

Anderson, Symmes, Forbes, Peete & Brown, Billings, Benjamin N. Forbes argued, Billings, for appellants.

Crowley, Kilbourne, Haughey, Hanson & Gallagher, Billings, Stephen H. Foster argued, Billings, for respondent.

JAMES T. HARRISON, Chief Justice.

This is an appeal by defendants from a judgment entered in the district court, Yellowstone County, on December 16, 1974; which permanently enjoined defendants from issuing title insurance policies as to property in this state, subject to certain exceptions. The injunction was suspended during the pendency of this appeal.

The facts were stipulated and in brief are: (1) Plaintiff Montana Land Title Association is a nonprofit Montana corporation. (2) Defendant First American Title and Escrow of Billings is a limited partnership. (3) Defendant First America Title Insurance is a California corporation doing business in the state of Montana. (4) That defendants are issuing and underwriting title insurance policies without written evidence of the condition of title certified by one holding a certificate of authority issued under section 66-2111, R.C.M.1947. (5) Such policies are not issued through a licensed title insurance agent as required by section 40-4601, R.C.M.1947.

Section 40-4601 provides, so far as pertinent here:

'No title insurance policy as to property in this state shall be issued by any insurer unless based upon evidence of the condition of title certified in writing as of the date of the policy by some person, firm, or corporation holding a certificate of authority issued under section 66-2111, to engage in the title abstracting business in the county in which the property is located; except, that this provision shall not apply as to title insurance policies issued upon the basis of an opinion of an attorney, duly authorized to practice law in this state, as to the condition of the title following a review by such attorney of pertinent title records or abstracts, and issued through a licensed title insurance agent who was so licensed and was regularly procuring title insurance policies issued upon such basis up to the effective date of this code.'

Only two issues are raised on appeal. First, defendants contend the district court did not have jurisdiction by reason of the failure of plaintiff to exhaust or pursue the administrative remedies provided by sections 40-2720 through 2725, R.C.M.1947. It will not be necessary to discuss this issue in view of our holding on the second issue.

That issue is, whether section 40-4601, R.C.M.1947, is constitutional under the Montana Constitution or the Fourteenth Amendment of the United States Constitution.

Section 40-4601 in essence states that title insurance companies may issue title insurance policies on the basis of a legal opinion of a duly licensed Montana attorney if they were doing so regularly on July 1, 1961, the effective date of the Act, but title insurance companies who were not doing so regularly on said date cannot issue title insurance policies based upon the opinion of a duly licensed attorney in the state of Montana. In other words, some licensed title insurance agents may issue title insurance based upon the opinion of a duly authorized Montana attorney, but others may not. It is defendants' contention that such discrimination violates the Fourteenth Amendment to the Constitution of the United States which states that no state shall 'deny to any person within its jurisdiction the equal protection of the laws.'

Article II, Section 17, 1972 Montana Constitution, is the counterpart of the Fourteenth Amendment to the United States Constitution, and states that 'No person shall be deprived of life, liberty or property without due process of law.'

The constitutional guarantee of equal protection of the laws requires that all persons shall be treated alike under like circumstances and conditions, both in the privileges conferred and in the liabilities imposed.

This Court early adhered to this guarantee, as expressed in State v. Cudahy Packing Co., 33 Mont. 179, 186, 82 P. 833, 835, in these words:

'* * * 'the equal protection of the laws is a pledge of the protection of equal laws,' herein declaring, in substance, that not only must the law as enacted furnish equal protection to all, but also that the Legislature, in enacting any law, must so adjust its provision that it will operate equally upon the individuals constituting the class of citizens whose conduct it is intended to control.'

Plaintiff relies heavily on State ex rel. Freeman v. Abstracters Board of Examiners, 99 Mont. 564, 580, 45 P.2d 668, 672 (1935) which upheld section 66-2112, R.C.M.1947, requiring abstracters to have abstract books or indices, but permitted the issuance of a temporary license for a period of one year only to abstracters who, on the effective date of the Act, were in the process of preparing abstract books or indices. The Court rejected the contention that the statute was arbitrary and discriminatory, and in its opinion...