State ex rel. Atty. Gen. v. Fidelity & Casualty Ins. Co. of New York

• Decision Date: 24 June 1892
• Citation: 49 Ohio St. 440,31 N.E. 658
• Parties: STATE ex rel. ATTORNEY GENERAL v. FIDELITY & CASUALTY INS. CO. OF NEW YORK.
• Court: Ohio Supreme Court

31 N.E. 658

49 Ohio St. 440

STATE ex rel. ATTORNEY GENERAL v. FIDELITY & CASUALTY INS. CO. OF NEW YORK.

Supreme Court of Ohio.

June 24, 1892

Quo warranto proceedings on the relation of the attorney general against the Fidelity & Casualty Insurance Company of New York. On application for leave to reply to a certain defense. Application denied.

Syllabus by the Court

1. A foreign insurance company, exercising in this state franchises and privileges without authority of law, may be ousted therefrom by a proceeding in quo warranto . State v. Insurance Co., 24 N.E. 392, 47 Ohio St. 167.

2. The issuing of a license to a foreign insurance company to do business in this state by the superintendent of insurance is a ministrial, and not a judicial, act, and is therefore not a bar to a proceeding in quo warranto , where it is charged with exercising franchises and privileges without authority of law.

3. The provisions of section 282, Rev. St., imposing on insurance companies of another state or nation, doing business in this state, the same obligations and prohibitions that are imposed in such other state or nation upon Ohio companies doing business therein, are retaliatory in character, and must therefore, be confined to such cases as fairly fall within the letter of the statute.

4. To make a case for the application of the retaliatory provisions of section 282, Rev. St., against an insurance company of another state, doing business in this state, it must be made to appear that an Ohio company has been formed in this state to do substantially the same kind and lines of insurance, and would, by the laws of that state, be precluded from transacting the same therein, or be subjected to burdens not imposed by the laws or this state on such foreign company.

5. The making and filing, for the purpose of profit, of articles of incorporation in the office of the secretary of state, do not make an incorporated company; such articles are simply authority to do so. No company exists, within the meaning of the statute, until the requisite stock has been subscribed and paid in, and the directors chosen.

David K. Watson , Atty. Gen., and Harrison, Olds & Henderson , for plaintiff.

W. J. Gilmore , for defendant.

MINSHALL, J.

1. The defendant is a fidelity and casualty insurance company, organized under the laws of the state of New York, and doing, in this state, what, by the laws of New York, is authorized and known as four lines of such insurance, to wit: First , against injury, disablement, or death of persons resulting from traveling or general accidents by land or water; second , guarantying the fidelity of persons holding places of public or private trust; third , upon plate glass against breakage; fourth , upon steam boilers against explosion, and against loss or damage to life or property resulting therefrom. Its right to do more than one of such lines of business in this state is challenged by the attorney general on the ground that, by the laws of New York, no company incorporated in this state can transact in that state more than one of such lines of insurance; and therefore, under the provisions of section 282, Rev. St., of this state, it has no right to make in this state more than one of the lines of insurance it is doing. That section reads as follows: ‘ When, by the laws of any other state or nation, any taxes, fines, penalties, license fees, deposits of money, or of securities or other obligations or prohibitions are imposed on insurance companies of this state, doing business in such state or nation, or upon their agents therein, so long as such laws continue in force, the same obligations and prohibitions, of whatever kind, shall be imposed upon all insurance companies of such other state or nation doing business within this state, and upon their agents here.’ A demurrer to the petition, objecting to the jurisdiction the court as well as to the sufficiency of the pleading, having been overruled, the defendant, as a third defense to the petition, answered: ‘ That under the laws of New York it is legally authorized and empowered to do, and is now doing, the four lines of insurance in that state, which the petition charges it with illegally doing in Ohio; and that, under the laws of Ohio, a corporation could be legally incorporated and organized with power to do the same four lines of insurance, or any one or more of them, therein, but that no such company has yet been organized to do said four lines of insurance in Ohio, and hence no such company has yet made or could make, application to the proper officers in New York for a license to do said four lines of insurance in the state of New York.’ A demurrer to this defense having been overruled, the plaintiff asked leave to reply in substance as follows: That on January 13, 1887, the requisite number of persons, citizens of Cuyahoga county, ‘ subscribed and acknowledged articles of incorporation,’ stating therein the name, place of business, and capital stock of the proposed corporation, and its object, to wit, under paragraph 2, § 3641, Rev. St., to do the four kinds of insurance now being done by the defendant in this state; and the same, having been approved by the attorney general as in conformity to the laws of the state, were then filed and recorded in the office of the secretary of state of Ohio, ‘ whereby,’ it is averred, ‘ an Ohio corporation was duly and legally formed for the purpose of doing the lines of insurance mentioned in the articles of incorporation.’ As no report has heretofore been made of any of the rulings of the court in the progress of the case, it is proper that two of them should be noticed before passing on the application for leave to reply; that is to say, (1) the jurisdiction of the court, and (2) the sufficiency of the third defense.

1. It is claimed that, as the defendant is a foreign corporation it cannot be affected by a proceeding in quo warranto in the courts of this state. That it cannot be ousted of the right to be a corporation, or of any of the franchises conferred on it by the laws of New York, is not doubted; but as to such franchises and privileges as are derived from the laws of the state of Ohio it is as much...