State ex rel. Kahn v. Tazwell

• Decision Date: 27 March 1928
• Parties: STATE EX REL. KAHN v. TAZWELL, JUDGE OF CIRCUIT COURT. [*]
• Court: Oregon Supreme Court

266 P. 238

125 Or. 528

STATE EX REL. KAHN v. TAZWELL, JUDGE OF CIRCUIT COURT. ^[*]

Supreme Court of Oregon, En Banc.

March 27, 1928

Original mandamus by the State, on the relation of Adolf Kahn, against George Tazwell, as Judge of the Circuit Court for Multnomah County, to compel defendant to entertain jurisdiction in an action by relator against the New York Life Insurance Company. Writ granted.

Coshow J., dissenting.

C. T. Haas, of Portland (Peter A. Schwabe, of Portland, on the brief), for relator.

B. S Huntington and W. M. Huntington, both of Portland (Huntington, Wilson & Huntington, of Portland, on the brief), for defendant.

McCamant & Thompson, of Portland, amici curiæ, for Mutual Life Ins. Co.

BEAN J.

This is an original proceeding in mandamus, to require the defendant, Hon. George Tazwell, judge of the circuit court for Multnomah county, to entertain jurisdiction of an action commenced by the relator, Adolf Kahn, against the New York Life Insurance Company, a New York corporation, on an insurance policy, and to try the action. The application for the policy was made by the plaintiff in Germany, signed by the president and secretary of the New York Life Insurance Company at its main office, New York City, and was signed by the general secretary of the company for Europe at the New York Life Insurance Company's office in Paris, France.

The New York Life Insurance Company is authorized to conduct life insurance business anywhere. Prior to the declaration by the United States of war against Germany, this corporation was transacting life insurance business in Germany. This company, as one of the requirements essential to the right to transact its business in the state of Oregon, on February 16, 1923, executed and filed with the insurance commission, as required by section 6327, Or. L., a power of attorney appointing R. A. Durham, a citizen of Oregon, residing at Portland, its attorney in fact, upon whom "lawful and valid service may be made of all writs, processes and summons in any case, suit or proceeding commenced by or against any such company or association in any court mentioned in this section and necessary to give such court complete jurisdiction thereof."

The action mentioned was commenced October 3, 1927, and summons and complaint was served by delivery to the said R. A. Durham, as such attorney in fact. The defendant appeared specially and filed a motion to quash the service of the summons, for the reason that the service was not authorized by law; and that the court could not obtain jurisdiction over the person of the defendant New York Life Insurance Company in that plaintiff was and is a resident and citizen of the republic, formerly empire, of Germany, and has not been a resident, inhabitant, or citizen of the state of Oregon, and was not at the time of the commencement of the action, and is not now, within the state of Oregon, as shown by affidavit.

The defendants filed a demurrer to the writ. The questions thereby raised are, as stated in defendant's brief, Does the limitation expressed in the title to insurance law, "Insurance in the State of Oregon," apply to section 3a, requiring of every foreign corporation, as a requisite to doing business in this state, the appointment of an attorney in fact upon whom service of summons may be made? Did our Legislature intend that section 3a should be construed so as to permit service of process in this state upon a foreign insurance company qualified to do business here, of summons in any action brought by any person upon any kind of cause of action arising outside of the state? Second, is the stipulation contained in the policy in question valid and controlling:

"For the fulfillment of this contract only the courts of Karlsruhe are competent; as the legal domicile of the company is agreed upon its office at Karlsruhe and for the insured or his legal successor the place mentioned in the application of insurance. * * *"

The circuit court at first denied the motion to quash the service. A motion for rehearing was then filed by the defendant New York Life Insurance Company, and a rehearing was granted. At the rehearing, Judge Tazwell, Judges J. W. Knowles and Fred W. Wilson, together heard the motion, and thereafter Judge Tazwell granted the same and declined to take jurisdiction of the law action mentioned.

Plaintiff contends that, under the Oregon statute (section 6327), the court can obtain proper jurisdiction of the person of the defendant company by due service made upon its attorney in fact.

The title of the Insurance Act (chapter 203, General Laws 1917, p. 312) is "to provide for the regulation and supervision of insurance in the state of Oregon, other than state industrial accident insurance, and repealing, * * *" (several sections of the code mentioned).

Article 4, § 20, of the Constitution, ordains in part as follows:

"Every act shall embrace but one subject, and matters properly connected therewith, which subject shall be expressed in the title."

Section 3a, of chapter 203, Or. L. § 6327, provides:

"Every foreign or alien insurance company shall, before transacting business within this state, duly execute and acknowledge a power of attorney, and cause the same to be filed in the office of the insurance commissioner, which power of attorney shall be irrevocable except by the substitution of another qualified person for the one mentioned therein as attorney in fact, and such power of attorney shall appoint some person who is a citizen of the United States, and a citizen and resident of this state, as attorney in fact for such foreign or alien company or association, and such appointment shall authorize and empower such attorney to receive and accept service of all writs, processes and summons requisite or necessary to give complete jurisdiction of any such company or association to any of the courts of this state, or the United States courts therein, and shall be deemed to constitute such attorney the authorized agent of such company or association upon whom lawful and valid service may be made of all writs, processes and summons in any case, suit or proceeding commenced by or against any such company or association in any court mentioned in this section and necessary to give such court complete jurisdiction thereof. * * *"

As the language of article 4, § 20, of the organic act indicates, the Insurance Act should embrace but one subject, "and matters properly connected therewith." Are the matters embraced in section 6327, Or. L., properly connected with the regulation and supervision of insurance in the state of Oregon?

It is not essential that all the matters or items embraced in an act should be mentioned in the title. If the provisions of the act are reasonably connected with and germane to the subject expressed in the title, there would be no repugnancy to article 4, § 20, of the Constitution. 1 Lewis Sutherland Stat. Const. (2d Ed.) § 18; P. Elevator Co. v. Portland, 65 Or. 349, 384, 133 P. 72, 46 L. R. A. (N. S.) 363.

The Insurance Act provides for the appointment of an insurance commissioner, and prescribes his powers and duties. It prescribes the conditions and requirements in detail, with which every insurance company, domestic, foreign, or alien, must comply in order to be entitled to do business in this state. It directs the proceedings for the liquidation of insolvent insurance companies, and provides for the certain deposits of securities with the commissioner, or the establishment of a financial status of the company, and makes various provisions for the regulation of insurance business in order for the proper conduct of such business and the issuing of insurance policies and the fulfillment thereof.

It seems appropriate and reasonable that, with the other provision of the law, and as connected with the regulation and supervision of insurance, the provision of section 3a of the act (section 6327, Or. L.) should be included, so that, as a condition precedent to a foreign or alien insurance company doing business in this state, it shall execute a power of attorney and file same with the insurance commissioner, which power of attorney shall appoint a citizen, and resident of the state, as attorney in fact for such foreign or alien company, and authorize and empower such attorney to receive and accept service of all writs, processes, and summons, requisites to give complete jurisdiction of any such company to any of the courts of the state, or the United States courts therein, so as to constitute such attorney the authorized agent of such company upon whom lawful and valid service may be made of all such writs and processes in any case, suit, or proceeding commenced "by or against any such company or association in any court mentioned in this section and necessary to give such court complete jurisdiction thereof." Otherwise the business of issuing insurance policies and making insurance contracts could not be carried to a successful completion, and such contracts enforced in all cases, in a practical and convenient manner.

When the New York Life Insurance Company complied with this section, it consented to all the terms thereof, and assumed the duties and liabilities thereby imposed, as well as accepting the privileges and benefits thereof. Ramaswamy v. Hammond Lbr. Co., 78 Or. 407, 152 P. 223. Such company, upon complying with the state law, has the right to institute and prosecute any action or suit against any person in any of the courts of this state, whether the cause of action or suit is based upon a contract made in the state or elsewhere.

Oregon Laws, § 6908, contains a like provision for the appointment of an attorney in fact by other foreign corporations before doing business in this...