Swing v. Hill

• Decision Date: 27 October 1905
• Docket Number: 20,628
• Citation: 75 N.E. 658,165 Ind. 411
• Parties: Swing, Trustee, v. Hill et al
• Court: Indiana Supreme Court

75 N.E. 658

165 Ind. 411

Swing, Trustee, v. Hill et al

No. 20,628

Supreme Court of Indiana

October 27, 1905

From Monroe Circuit Court; James B. Wilson, Judge.

Action by James B. Swing as trustee for the creditors of the Union Mutual Fire Insurance Company against Nathaniel U. Hill and another. From a judgment for defendants, plaintiff appeals. Transferred from Appellate Court under § 1337u Burns 1901, Acts 1901, p. 590.

Reversed.

Miers Corr & Miers and P. A. Reece, for appellant.

Duncan & Batman, for appellees.

OPINION

Gillett, J.

James B. Swing, as trustee for the creditors of the Union Mutual Fire Insurance Company, of Cincinnati, Ohio, brought this action against appellees to recover on account of a statutory liability alleged to exist against the latter as policy holders in said company. Appellees filed a plea in abatement, alleging, in substance, that their contracts of insurance with said company were made in the State of Indiana, and that said company had not complied with the insurance laws of this State. Appellant, by way of reply admitted that said company had not taken the steps required by statute as a prerequisite to doing business in Indiana, and denied each and every one of its allegations as to all other matters set up in said answer. A demurrer was sustained to this reply, and appellant excepted. He afterwards filed a general denial to said answer, but as he subsequently withdrew the latter reply, and refused to plead further, the court rendered judgment that the action abate.

It is evident that it was the theory of said answer, that as said insurance company had entered into the contracts of insurance with appellees in the State of Indiana without complying with the insurance laws thereof, the action ought to abate, and the question arises whether upon a denial of the allegation that the contracts were made in this State, there appeared upon the record admitted allegations which justified the abating of the action. Although it is competent for the State by legislation to prevent foreign corporations from entering into insurance contracts in this State concerning property therein without complying with the statutes, and while it is also competent for the State to prohibit the agents of such companies from soliciting insurance in this State, yet the legislature is not empowered to enact a statute whereby it prohibits citizens from entering into contracts outside of this State insuring property within its boundaries. Allgeyer v. Louisiana (1897), 165 U.S. 578 17 S.Ct. 427, 41 L.Ed. 832; Nutting v. Massachusetts (1902), 183 U.S. 553, 22 S.Ct. 238, 46 L.Ed. 324. In Allgeyer v. Louisiana, supra, the Federal Supreme Court used the following language: "Has not a citizen of a state, under the provisions of the federal Constitution above mentioned, a right to contract outside of the state for insurance on his property--a right of which state legislation can not deprive him? We are not alluding to acts done within the state by an insurance company or its agents doing business therein, which are in violation of the state statutes. * * * When we speak of the liberty to contract for insurance or to do an act to effectuate such a contract already existing, we refer to and have in...