State v. Loucks

• Citation: 30 Wyo. 485,222 P. 37
• Decision Date: 22 January 1924
• Docket Number: 1211
• Parties: STATE v. LOUCKS
• Court: United States State Supreme Court of Wyoming

222 P. 37

30 Wyo. 485

STATE v. LOUCKS

No. 1211

Supreme Court of Wyoming

January 22, 1924

ORIGINAL proceedings in mandamus by the State on the relation of Horace R. Coddington, against H. A. Loucks, as Insurance Commissioner of the State, to require revocation of an order canceling relator's license as an insurance agent. Heard on demurrer to the petition.

Demurrer Overruled.

David J. Howell, Atty. Gen. for the demurrer.

The statutes relating to the revocation of an insurance agents' license are 5235-37 C. S.: These Sections were originally enacted as Chap. 101, Laws 1890-91. The power to cancel a license was not contained in the original act, but was added by amendment, Chap. 33, Laws 1897, this Section prescribes a double penalty for violation of Sec. 5235 to-wit: conviction for misdemeanor, or cancellation of the agent's license; convincing evidence was adduced in this case, and the Commissioner had power to cancel the license. The same Company has been before the Supreme Court of Utah on a similar charge. Utah Assn. v. Mtn. States L. I Co., 200 P. 673. The statute is an exercise of police power. 22 Cyc. 1394. Power to revoke is a necessary consequence of power to grant. Doyle v. Cont. Co., 94 U.S. 535; Manchester Co. v. Herriott, 91 F. 711, plaintiff's license purports to have been issued under Section 3, Chap. 142, Laws 1921, and if so issued, was unauthorized, (1) Because insurance agents are excepted from its provision, and (2) licenses granted under the section expire on March 31st subsequent to the date of issue. Plaintiff's license should have been issued under 5277 C. S. and made to expire December 31st of each year. The Commissioner had no power to issue a license for a period of fourteen months; mandamus is not the proper remedy; the insurance Commissioner had discretion to act; judicial discretion cannot be controlled by mandamus 6317 C. S., certain discretion must be given to inferior officers; this has been done in the case of the Insurance Commissioner, and the Court should not interfere in the exercise of that discretion, but may require that he follow the proper procedure and keep within the law governing the conduct of his office.

C. L. Rigdon for Plaintiff.

Relator's license was cancelled without notice or hearing; authority for this is claimed under 5237 C. S.; Sec. 5235 provides two distinct offenses, the first deals with rebates, the second with offers to sell stocks, bonds, etc., as an inducement to insure; it is only in case of rebate that the statute authorizes cancellation of the agent's license without a hearing; there is no provision of law for such cancellation on the ground that stock has been sold or offered as an inducement, or in connection with a policy of life insurance not specified in the policy; the word "rebate" has a settled meaning in law; it means to rebate or deduct from, Webster; State v. Swartzchild, 85 Me. 261; State v. Insurance Co., 38 La. 465; Julian v. Life Ins. Co., 49 So. 324. A Commissioner can cancel a license only for statutory cause. Liverpool Co. v. Clunie, 88 F. 160; U. S. v. Daugherty, 27 F. 730; U. S. v. Kirby, 7 Wall. 42; Meacham Pub. Off. Paragraph 511; South St. Const. Law, Para. 392; Ins. Co. v. Prewitt, 127 Ky. 399, 105 S.W. 463; Brown v. Commonwealth, 98 Va. 366, 36 S.E. 485; Kloss v. Commonwealth, 103 Va. 864, 49 So. 655; Ry. Co. v. Clarke, 95 Miss. 689, 49 So. 177. The Commissioner acted without notice or hearing; 5237 C. S., is unconstitutional since it denies due process of law. Art. I, Sec. 6-7; Art. XIV, Sec. 1 Const. U.S. Sterritt v. Young, 14 Wyo. 146, 82 P. 946; there is no provision for appeal. Simon v. Craft, 182 U.S. 436; Ball v. Rutland Ry. Co., 93 F. 517; People v. Kelsey, 113 N.Y.S. 836; Riley v. Wright, (Ga.) 107 S.E. 857; Mott v. State Brd., (Ga.) 95 S.E. 867; Jewell v. McCann, (Ohio) 116 N.E. 42; People v. Flynn, 96 N.Y.S. 655; Stuart v. Palmer, 74 N.Y. 183, 30 Am. Rep. 289; Smith v. State Brd. 140 Ia. 66, 117 N.W. 1116; U. S. v. McFarland, 28 App. D. C. 552; Mercantile Co. v. Craig, 106 Tenn. 621, 62 S.W. 155; People v. Van Cleave, 55 N.E. 698, 183 Ill. 330; People v. McCoy, 125 Ill. 289, 17 N.W. 786; State v. Schultz (Mont.) 28 P. 643; People v. Dept. of Health, 189 N.Y. 187, 82 N.E. 187; People v. Wilson, 166 N.Y.S. 211; Miller v. Johnson, (Kans.) 202 P. 619; Killgore v. Zinkham, 274 F. 141; Abrams v. Daugherty, (Cal.) 212 P. 942; Abrams v. Jones, (Idaho) 207 P. 724; Balling v. Board, 79 N.J.L. 197, 74 A. 277. The validity of the license cannot be raised on demurrer; the petition alleges the ground of cancellation, and the Commissioner cannot assert a different ground; he is estopped from questioning the legality of the license; the Commissioner is without authority to cancel a license irregularly or illegally issued, but the license is legal; it is good, at least to the date fixed by law. Common Council v. State, 59 Wis. 425, 18 N.W. 324; U. S. v. Walker, 148 F. 1022; State v. Taylor, 28 La. Ann. 460; Morrison v. Atkinson, 16 Okla. 571; Ohio Ry. Co. v. McCarthy, 96 U.S. 258; Relator has no plain and adequate remedy, and mandamus is the proper remedy. Lobban v. State, 9 Wyo. 377, 64 P. 82.

David J. Howell, Atty. Gen. & Ray E. Lee, Special Asst. Atty. Gen. in reply.

Plaintiff has no property rights in the subject-matter of the action, 5277 C. S., the license belonged to his company; the company is not made a party; State v. Marston, 6 Kans. 524; Sec. 5237 is constitutional; a license may be revoked without notice or hearing, Wallace v. Reno, 63 L. R. A. 337; Littleton v. Burgess, 14 Wyo. 182. The statute is a police regulation, it should be upheld to effectuate its object. Utah Assn. v. Ins. Co. (Utah.) 200 P. 677. The Commissioner acted in an unadministrative capacity, and no question of process of law is involved. People v. Dept. of Health, 189 N.Y. 187, 82 N.E. 187, 13 L. R. A. (NS) 894. Police power extends to prevention of fraud, Coffman v. Ousterhouse, 40 N.D. 390, 168 N.W. 826, 18 A. L. R. 225. A license may be refused, People v. Grant, 27 N.E. 964, or revoked, Des Moines v. Oil Co., 193 Ia. 1096, 184 N.W. 823, and without notice, Child v. Beemus, (R. I.) 21 A. 539; Hartford Co. v. Raymond, (Mich.) 38 N.W. 447; Com. v. Kinsley, 133 Mass. 578.

Plaintiff is estopped from questioning the validity of the statute, Coffman v. Ousterhouse, supra, Lehman v. Board, 94 So. 94; State v. Collins, (Mo.) 125 S.W. 465; State v. Ry. Co., 75 N.H. 327, 74 A. 542; Ferguson v. Landram, 5 Bush (Ky.) 230, 96 Am. Dec. 350; Hartford Co. v. Perkins, 125 F. 502; Doyle v. Ins. Co., 94 U.S. 535; Gano v. Ry. Co., 114 Ia. 713, 55 L. R. A. 263, Aff'md. 190 U.S. 557; Cram v. Ry. Co., 85 Neb. 586. Mandamus will not compel an officer to perform an illegal act. State ex rel, Schnitger, 16 Wyo. 519; it is not a writ of right, State v. Un. Ex. Co., (Minn.) 104 N.W. 556; State v. Fagan (N. J.) 27 A. 1091; Simmons v. David, (R. I.) 25 A. 691; Von Akin v. Dunn, 75 N.W. 938.

KIMBALL, Justice. POTTER, Ch. J., and BLUME, J., concur.

OPINION

KIMBALL, Justice.

This is an original action in mandamus raising the question of the right of the defendant, the state insurance commissioner, to cancel a certificate of authority or license, which we shall call the license, dated January 30, 1923, issued to the relator as agent of the Mountain States Life Insurance Company.

On its face the license in question authorizes the relator to act under it until March 31, 1924.

The petition alleges that the license was cancelled by defendant September 25, 1923 on the pretended ground that relator had sold or offered to sell as an inducement to insurance or in connection therewith the stocks of said company in violation of section 5235, Wyo. C. S. 1920. The petition alleges further that the relator has ever complied with the laws and regulations in force in the state governing such agents; that the cancellation of the license was made without notice to relator and without any hearing or trial, and without giving him an opportunity to be heard; that it was made irregularly, hastily and arbitrarily, contrary to law and in disregard of the rights of relator; that the defendant was without power or authority under the law to cancel the license, and has denied relator's request that the order of cancellation be revoked.

The attorney general demurs to the petition on the ground that it does not state facts sufficient to constitute a cause of action.

The statute providing for licenses like the one in question is as follows (Sec. 5277 Wyo. C. S. 1920):

"Before transacting any fire, life or other indemnity or insurance business, each and every agent, firm or corporation acting as agent, solicitor or representative of such corporations or associations, shall procure annually from the state auditor a certificate of authority or license as an agent, solicitor or representative of each corporation or association represented by him or them, and which certificate shall terminate or expire on the 31st day of December of each year unless sooner revoked or terminated as otherwise provided, for which a fee of two dollars for each certificate shall be paid to the state auditor. Certificates of authority or license issued under this section shall be considered the license of the company, corporation, association or society applying for the same, and shall not be transferable from the agent, firm or corporation for which the license was originally issued to another agent, firm or corporation."

By later laws the insurance commissioner has succeeded to the duties formerly performed by the state auditor as ex-officio insurance commissioner.

Because the relator's license does not by its terms expire December 31, 1923, as would seem to have been required by this section, but purports to grant...