State ex rel. Sorensen v. Lincoln Hail Ins. Co., 30043.
| Citation | 276 N.W. 169,133 Neb. 496 |
| Decision Date | 12 November 1937 |
| Docket Number | No. 30043.,30043. |
| Parties | STATE EX REL. SORENSEN, ATTY. GEN., v. LINCOLN HAIL INS. CO. ET AL. (BONNEMEIER ET AL., INTERVENERS). |
| Court | Supreme Court of Nebraska |
STATE EX REL. SORENSEN, ATTY. GEN.,
v.
LINCOLN HAIL INS. CO. ET AL. (BONNEMEIER ET AL., INTERVENERS).
No. 30043.
Supreme Court of Nebraska.
Nov. 12, 1937.
[276 N.W. 170]
1. “An action does not abate * * * by the transfer of any interest therein during its pendency, if the cause of action survive or continue. * * * In case of any other transfer of interest, the action may be continued in the name of the original party; or the court may allow the person to whom the transfer is made to be substituted in the action.” Comp.St.1929, § 20-322.
2. The order for the sale or disposition of the assets of a trust being one within the discretion of the district court to make and enter, a receiver, appointive or statutory, has no right to appeal therefrom, for he is neither the censor of the court nor interested in the event.
3. The statutory provision applicable to the Lincoln Hail Insurance Company, and constituting a controlling element in all its contracts of insurance, recites: “All such associations shall deposit in some bank or banks fifty per cent. of all the assessments or premiums received from its members or policyholders which deposit shall be drawn from said bank for the payment of losses only, and by check or order issued by the treasurer of such association. Each check or order shall designate the name of the policyholder for whose benefit the money is drawn,” etc. Comp.St.1929, § 44-912 and as amended (Comp.St.Supp.1933, § 44-912).
4. It appearing that appellants as special agents were at all times in possession of their trust under an order of a court of competent jurisdiction directing them to continue to administer it “as a going concern,” such order amounted to an express direction to conduct its affairs in the usual, ordinary way for which it was organized, with a full compliance with the public policy of the state as expressed in the applicable statutes, and the performance of the company's contracts with its membership as an existing solvent institution.
5. The “loss fund” created by statutory mandate, usable exclusively for payment of losses arising from the insurance risks lawfully undertaken, to which fund 50 per cent. of all premiums received were incorporated, and a like per cent. of all premiums to be received were to be added, in view of the purpose of its creation, constituted a trust fund. The use of this fund by the special agents, now appellants herein, and its application by them to purposes other than those contemplated by the law of its creation, particularly while such special agents were judicially limited in their authority to conduct the business as a going concern, constituted, to the extent of the amounts so used and diverted, a misapplication thereof and rendered them personally liable therefor.
6. Record examined, and held that the denial of the claims of the special agents for further compensation amounted to the exercise of a sound discretion by the trial court, and the same is approved.
Appeal from District Court, Lancaster County; Broady, Judge.
Proceeding by the State of Nebraska, on the relation of C. A. Sorensen, Attorney General, against the Lincoln Hail Insurance Company and others, impleaded with F. A. Wood and M. Witzenburg, wherein Ludwig Bonnemeier and others intervened, and wherein Charles Smrha, Director of the Department of Insurance, was appointed receiver of the Lincoln Hail Insurance Company. From the judgments and decrees rendered, defendants F. A. Wood and M. Witzenburg appeal.
Affirmed.
[276 N.W. 171]
Albert S. Johnston, of Lincoln, for appellants.
Loren H. Laughlin, E. B. Perry, and John Logan, all of Lincoln, for appellee Lincoln Hail Ins. Co.
Richard F. Stout and J. O. Rodgers, both of Lincoln, for appellees Bonnemeier et al.
Clinton J. Campbell, of Lincoln, for appellee Chas. Carr.
Heard before GOSS, C. J., and ROSE, GOOD, EBERLY, DAY, and CARTER, JJ.
PER CURIAM.
This is an appeal from the decree and judgment of the district court for Lancaster county entered on August 10, 1936, denying claims for compensation in favor of F. A. Wood and M. Witzenburg, as special agents of the department of insurance of the state of Nebraska, and a judgment entered against such special agents in favor of Charles Smrha, receiver, in the sum of $12,633.56. Included herein is an appeal of F. A. Wood and M. Witzenburg from an order of the district court for Lancaster county, entered on August 12, 1936, approving and confirming the sale and disposition of the assets of the Lincoln Hail Insurance Company to Charles Carr.
These proceedings are the culmination of a course of events which had their inception in the fact that the Lincoln Hail Insurance Company, a corporation organized and existing under the laws of the state of Nebraska relating to assessment hail insurance companies was, on May 7, 1932, pursuant to the provisions of section 44-204, Comp. St. 1929, by order of the district court for Lancaster county, given into the possession of the department of trade and commerce, and that department was directed and authorized to take possession of all of its property, records, and effects, and for and in the name of the defendant insurance company to conduct the business of said company as a going concern, and as expeditiously as possible to make a complete examination of the affairs of that company.
This order further directed: “It is further ordered and decreed that, upon the completion of the examination aforesaid and as soon as said department may be advised in the premises, the department make its report herein to this court setting out its acts and doings under the provisions of this decree, and its advice, recommendation and application to this court as to the resumption by the defendant company of the possession of its assets, affairs and business or the liquidation of the business, as provided in said section 44-204, Compiled Statutes of Nebraska, 1929.”
In obedience to the decree last referred to, the examination of this company was completed, a report thereof was duly filed and, by order of the district court for Lancaster county entered on July 27, 1932, was approved, and it was further...
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