Woodmen Acc. Co. v. District Court in and for Marshall County

• Decision Date: 14 May 1935
• Docket Number: 42865.
• Citation: 260 N.W. 713,219 Iowa 1326
• Parties: WOODMEN ACCIDENT CO. v. DISTRICT COURT IN AND FOR MARSHALL COUNTY et al. MUTUAL BENEFIT HEALTH & ACCIDENT ASS'N v. SAME.
• Court: Iowa Supreme Court

260 N.W. 713

219 Iowa 1326

WOODMEN ACCIDENT CO. v. DISTRICT COURT IN AND FOR MARSHALL COUNTY et al.

MUTUAL BENEFIT HEALTH & ACCIDENT ASS'N v. SAME.

No. 42865.

Supreme Court of Iowa.

May 14, 1935

Certiorari to District Court, Marshall County; Carl B. Stiger, Judge.

Action in certiorari to test the jurisdiction of the Marshall county district court in two similar actions. Defendants filed a special appearance denying jurisdiction for lack of service. The lower court sustained the service and held the court had jurisdiction. This action is to test the legality of that ruling.

Writ annulled.

Hatter & Harned, of Marengo, for petitioners.

F. E Northup and H. Druker, both of Marshalltown, for defendants.

KINTZINGER, Justice.

Two petitions based upon similar claims against the Woodmen Accident Company, and the Mutual Benefit Health & Accident Association were filed in the district court of Marshall county on November 5, 1934. The same questions being involved in both cases, they were combined and tried together. The only service of the original notices was by an acceptance of service by the " deputy" insurance commissioner. The defendants filed a special appearance in both actions questioning the jurisdiction of the court for lack of proper service. The lower court sustained the service and denied the special appearance; hence this action.

The only question raised here is whether or not an acceptance of service by the deputy insurance commissioner is sufficient to give the court jurisdiction. It is admitted that original notices in both actions were sent to the commissioner of insurance by registered mail on February 21, 1934. The record shows that the only return of service made thereon was by the deputy insurance commissioner, as follows:

" Return of Service.

Service of the within notice is hereby accepted as is provided by law for the Woodmen Accident Company, defendant named in the within entitled cause, this 23d day of February, 1934.

(Rubber stamp) E. W. Clark,

Commissioner of Insurance.

By Leon M. Penquite, Deputy Comm."

The return is identical in both actions. The name of " E. W Clark, Commissioner of Insurance" was placed thereon by a rubber stamp, and the return was signed by " Leon M Penquite, Deputy Comm." The return of service in both actions was duly sent to, and received and filed by, the clerk of the district court on February 24, 1934. Copies thereof were duly sent to the defendants by registered mail.

Appellants contend that the acceptance of service by the deputy insurance commissioner does not constitute service upon the defendant companies. If such acceptance does not constitute service upon the defendants, then, of course, there was no notice upon them, and the court had no jurisdiction. It is the universally accepted rule of law that a judgment cannot be rendered against a defendant who has not been served with an original notice of the action; and that a judgment rendered against such a person is not only voidable, but absolutely void. This rule is so elementary that a citation of authorities is unnecessary. See, however, Simon v. Southern Railway Company, 236 U.S. 115, 35 S.Ct. 255, 59 L.Ed. 492; Blain v. Dean, 160 Iowa, 708, 142 N.W. 418.

It is conceded that the defendants are nonresident insurance corporations. One method of obtaining service upon such corporations is that provided by sections 8952 and 8953 of the Code of 1931, and service in this action was attempted by that method. Section 8952 provides: " Any foreign company desiring to transact the business of insurance * * * in the state, shall file with the commissioner of insurance a written instrument, duly signed and sealed, authorizing such commissioner to acknowledge service of notice or process for and in behalf of such company in this state, and consenting that service of notice or process may be made upon the said commissioner, and when so made shall be taken and held * * * valid. * * *" (Italics ours.)

Section 8953 provides that: " Such notice or process with a copy thereof may be mailed to the commissioner of insurance at Des Moines, Iowa, in a registered letter addressed to him by his official title, and he shall immediately upon its receipt acknowledge service thereon on behalf of the defendant foreign insurance company by writing thereon, giving the date thereof, and shall immediately return such notice or process in a registered letter to the clerk of the court in which the suit is pending, * * * and shall also forthwith mail such copy, with a copy of his acknowledgment of service written thereon, in a registered letter" to the defendant named in the notice. (Italics ours.)

It is conceded that the original notice in this action was sent to the insurance commissioner at Des Moines by registered mail. It is also conceded that an acknowledgment of service by the deputy, as hereinabove set out, was returned to the clerk of the district court, and a copy thereof forwarded by registered mail to the defendants.

The question for consideration, therefore, is, Was the acceptance of service made by the deputy insurance commissioner, as thus made, sufficient to give the court jurisdiction of the defendants? Appellants contend that the only person authorized to accept service for them, or upon whom service could be made, as their agent, was the insurance commissioner of Iowa, who was the particular person appointed by them as their agent for that purpose, under the written instrument required by section 8952. Appellants also contend that unless service is made upon the insurance commissioner himself, or unless he personally accepts service of the notice, the court has no jurisdiction.

An analysis of section 8952 clearly shows that the person authorized to accept service for the defendant company or the person upon whom notice of the action can be served is the insurance commissioner of the state. We assume from the argument that the defendant insurance company filed the written instrument in the office of the insurance commissioner consenting that service of the original notice could be made upon him as provided by section 8952. By the filing of this instrument the insurance commissioner became their agent for the purpose of having service made upon him. Greaves & Co. v. Posner, 111 Iowa, 651, 82 N.W. 1022; New Hampshire Fire Insurance Company v. Utterback, 184 Iowa, 661, 169 N.W. 46.

Although the statutes require the appointment of such an agent by foreign insurance companies, the agency itself is created by the written instrument filed, authorizing the insurance commissioner to act as their agent in accepting service, or of having the original notices served upon him. Such agency, therefore, although given by statutory requirement, arises by virtue of the consent contained in the written instrument and not by the statute itself. In Greaves & Co. v. Posner, 111 Iowa, 651, loc. cit. 653, 82 N.W. 1022, 1023, we said: " It will be observed that by this written agreement power is conferred on the auditor to acknowledge service, and not independent of it. Without such consent he might not act in behalf of the association."

" The process is not served on the officer by virtue of his office, nor does he derive his authority to bind the corporation from his office or from the laws of the state. His entire authority comes from the commission executed by the corporation, and the donee of the power in that instrument is the officer and his successors in office." 21 R.C.L. 1360, § 110; Bennett v. Supreme Tent of the Knights of Maccabees, 40 Wash. 431, 82 P. 744, 2 L.R.A.(N.S.) 389.

The insurance commissioner under the written instrument required by the statute becomes the agent of the insurance company by virtue of the commission received by him from the company. The notice is not served on the commissioner by virtue of his office, nor does he derive his authority to bind the corporation from his office or from the laws of this state, but rather from the consent of the insurance company making him its agent.

Because the insurance commissioner is the designated officer appointed by the foreign insurance company for the purpose of accepting service of notice or having notice served upon him it has been held by many courts that, under a statute authorizing service upon a foreign corporation by serving notice upon a certain state officer, such service cannot be made on the officer's deputy. 21 R.C.L. 1360, § 110; Lonkey v. Keyes Silver Mining Company, 21 Nev. 312, 31 P. 57, 17 L.R.A. 351; Bennett v. Supreme Tent, K. of M., 40 Wash. 431, 82 P. 744, 2 L.R.A.(N.S.) 389; Old Wayne Mutual Life Ins. Association v. Flynn (Ind. App.) 66 N.E. 57; Amy v. Watertown, 130 U.S. 301, 317, 9 S.Ct. 530, 32 L.Ed. 951; Watertown v. Robinson, 69 Wis. 230, 233, 34 N.W. 139, 140; Chambers v. King Wrought-Iron Bridge Manufactory, 16 Kan. 270, 276; 47 L.Ed. 990, note; the reasons being set out in Lonkey v. Keyes Silver Mining Company, 21 Nev. 312, 31 P. 57, 58, 17 L.R.A. 351, where the court said: " The law in relation to the service of process on foreign corporations must receive a strict construction, and the service must be made upon the officer or person mentioned in the act of the legislature. The cases are numerous which hold that, where a particular method of serving process is pointed out by the statute, that method must be followed. * * * Was...