Accident Insurance Co. v. Dawson

46 S.E. 51, 53 W. Va. 619, 1903 W. Va. LEXIS 68

• Court: West Virginia Supreme Court
• Decided: May 16, 1903
• Status: Published

Opinions

BRANNON, Judge:

The Virginia Accident Insurance Compaq, a Virginia, corporation, desiring to do business in this state, filed with the secretary ol state, 7 March, 1903, a copy of the certificate of its corporation, and requested the Secretary of State to issue to it a certificate of the fact as provided in section 30, chapter 54 of the Code as it appears in chapter 35, Acts of 1901, p. 108; but the secretary refused such certificate and the company asks from this Court a mandamus requiring the Secretary to issue such certificate in order that it may carry on' its corporate business in this State. The company’s petition states that it engages in the business only of insuring persons against bodily injury sustained through external, violent and accidental means only; that it issues but one form of policy; that in case of accident to. one of its assured, it is bound by its policy to pay him $7.00 per week during disability for a period not exceeding 26 weeks; that in case of death within sixteen weeks after the injury, the company would pay $60.00 to the representative of the assured; that under one policy the liability could not exceed $182.00; that its policy assumes risk for only one month at a time, and lapses in default of premium, which is one dollar per month. The return of W. M. O. Dawson, secretary of state, to,the mandamus nisi awarded by this Court presents for our consideration two reasons why the mandamus should not go; first, that petitioner is a foreign insurance company and as such must get a certificate, not from the secretary of state, under section 30, chapter 54, code, but from the Auditor under another statute> section 2, chapter 34; and second, that if tire secretary is to issue a certificate, the company had not fully com.plied with section 30, chapter 54, as it did not, in addition to filing the certificate of incorporation, also file a writing accepting the provisions of section 30 of chapter 54 of the Code, and agreeing to be governed thereby.

The case involves only the construction of our statute law pertinent to the subject. Does the certificate to enable the petitioner as a foreign corporation to do business in this state emanate from the secretary of state under section 30, chapter 54, Code, or from the auditor under section 2, chapter 34, Code 1899? That depends on the question whether an accident insurance company is an insurance company within- tbe meaning of section 2, chapter 34. If it is then the petitioner is no-t entitled to a certificate from the secretary of state at all, but its certificate must come from the Auditor. On the other hand, if this company is not an insurance company within the meaning of section 2, chapter 34, then its certificate comes from the secretary of state, if it has fully complied with section 30, chapter 54 of the Code. Chapter 34 concerns insurance, telegraph and express companies generally by its title and by numerous detailed provisions as to terms upon which they shall operate, their taxation, service of process on them and their liability. Section 1 as found in chapter 107, Acts 1901, says that every insurance, telegraph, telephone or express company having its principal place of business in this state incorporated by Virginia before 20th June, 1863, or by this state shall be a domestic corporation; all others foreign. This provision is applicable to all insurance, telegraph, telephone and express companies. It distinguishes foreign from domestic corporations for general purposes of that chapter or any other, because there be certain provisions applicable to the one, and not to the other, and this section gives the test as to whether such a corporation is domestic or foreign for general legal purposes. It is applicable to all; but when we come to section 2, we find it limited to particular corporations, reading: “It shall not be lawful for any officer, or agent of any life, fire or marine insurance company, directly or indirectly, to take risks or issue policies of insurance within the State, without first procuring from the auditor a cirtificate as hereinafter directed.- Before obtaining such certificate, such company, its officers or agents, shall furnish the auditor with a statement under oath of the president or secretary of the company, for which he or they may act, which statement shall show:

First. The name and locality of the company,” and ten other items of the statement “which statement shall be filed in the office of the said Auditor.” Clearly this language is limited to “life, fire and marine insurance” companies. It does not include, but by implication excludes, accident insurance companies. Such its words. Do not these words mean what they import? Though only the words “life, fire or marine insurance” are used, do they have a broader meaning and include accident insurance — any insurance company? Do they include imploy-ees5 Liability Insurance, or Fidelity and Guarantee Insurance, or Title Insurance, or Lire Stock Insurance, or Boiler or Glass Insurance? Will those words open to take in every new species of insurance that may come in the mutation of business in future? I think not. But it is so argued, virtually. Let us go back to see whether these three words, “life” “fire” “marine,” were sedately chosen. An act passed in 1867 (chapter 117) laid a tax on “all insurance companies establishing agencies or doing business in this state except life and accidental,” and required a deposit of $25,000 with the Treasurer. This favored life and accident companies by exempting them from those demands. In the code of 1868, we find section 2, chapter 34, the parent of our present section 2, chapter 34. “It shall not be lawful for any officer or agent of any foreign fire or marine insurance company, directly or indirectly, to take risks or issue policies without procuring a certificate from the Auditor as hereinafter directed.” This includes only fire and marine insurance. So did the act of 1871, chapter 107. Two Acts of 1872-3, chapter 69 and chapter 221, and Acts of 1881, chapter 38, still include in the requirement of a certificate from the auditor only fire and marine insurance; but in 1882, (chapter 85) section 2, was amended to include life insurance companies. Chapter 34, Acts 1891 again amended section 2, but did not widen it as to the character of the companies. Thus we see that the Act of 1867 required of all insurance companies a deposit, but exempted life and accident companies. The code of 1868'required of foreign insurance companies an invested capital of $200,000 in section 2, chapter 34 of foreign insurance companies, but the section only named fire and marine companies. Accident and life companies were still exempted. The acts later exempted those two until 1882, when life companies were put into the section, but accident companies were still favored as they were by the Act of 1867. The Legislature through several acts favored life and accident companies, and then saw proper to make life companies come under the requirements of section 2, but still left out accident companies. Surely it knew of accident companies. Through eight acts amending section 2 it was choice in selecting the companies it would bring under the demands of section 2. The letter- of that section does not include accident companies;, and past acts show a purpose not to include them. Besides, there is reason for this. Fire, Marine and Life Insurance companies issue large policies calling for hundreds of millions of dollars in aggregate and only a few policies are of inconsiderable amount, while accident companies have small risks, and do not compare with the fire, marine or life companies either in aggregate of policies or in the amount of the several policies. The losses from them are incomparably smallvr. Here we find a reason for difference.

But section 2 after requiring of all fire, marine and life insurance companies a certain certificate adds, “No foreign insurance company, or agent thereof, shall transact any business of insurance in this state unless such company is possessed of at least one hundred thousand dollars of actual capital invested in the 'stock or bonds * * * * at the current market value at the date of such statement.” It is said that this applies to all insurance companies and includes accident companies. Observe that the section opens with requiring a statement of the character, assets apd other circumstances of only life, fire and marine insurance companies, and in immediate connection, it adds the obligation, as to foreign insurance companies, of having a certain capital. Why leave the words of the section a few lines above, in the opening words giving the companies to which the section relates, the subject of the section, and go off to find an accident, title or guaranty insurance company and apply this clause also to it? That clause makes this capital an element required for the issuance of the certificates, and that is the certificate required in the outset of this section only of life, fire and marine companies. This capital requirment is not an element participating in a distinct certificate. It is only one certificate with which the section deals. As the office of this clause is to add .a prerequisite to the certificate as to foreign companies, we must relate it only to those companies required to have that certificate. The section demands "a certificate by its words only of certain companies, specifies the requisites for it, and having done this section 3 requires the Auditor to issue that same certificate spoken of in the opening of section -2, that is after the “statement” is filed and evidence adduced of the invested capital, and in case it is a company of a state which requires a deposit of our companies, there must be also evidence that a like deposit has been made here. It is the one certificate which the section speaks of, and that is required only of life, fire and marine companies by the letter of the section 2.

It is admitted that the “statement,” distinctively so called, is required only of life, fire and marine companies. If so, accident companies do not have to file it. This tends to show that accident companies are not included. Note the words in section 2 “market value at the date of such statement.” That state- . ment is required only of life, fire and marine companies. It requires the investment only of them. Stress is placed in argument upon the provision in section 2 that the Auditor may investigate the condition of any insurance company, and if its condition is unsound, revoke its certificate. That does not broaden the scope of the section. That applies only where a certificate is required, and I repeat that there is but one certificate mentioned in the section, and that is the one required 'of life, fire and marine companies. If no statement is required of an accident company, then no certificate is required of it; for the filing of the statement is an element of the certificate or prerequisite. The same answer is given as to the feature authorizing the auditor to revoke a certificate where a company holding it has failed to pay a judgment. It applies only in those cases where a certificate is demanded by the statute. It may be that such powers over unsound accident, title, stock or other insurance should exist; but the Legislature has not yet provided for it

We are called by the brief to consider section 18, chapter 34, wherein it is provided that no agent shall make, renew or negotiate any insurance without “first obtaining the Auditor’s certificate of authority as required by law,” and subjecting him to penalty for so doing. It is said this requires a second certificate. Whether so or not, it has no force on the question in hand. But this section does not define a second certificate. It is the certificate “required by law;” that is, by other law, the one issued to the company under section 3. The only purpose of section 18 is to enforce the provision of section 2 requiring certain companies to have certificates of authority to insure. Insurance companies operate by officers and agents. If they are by punishment restrained from getting insurance for authorized companies, the evil contemplated will be suppressed, that is the issue of insurance policies by companies which have no certificate of authority. It is needless to cite authority to prove that an accident company is different from a life or fire or marine insurance company. The difference is substantial. We cannot accede to the position that this company is a life insurance because if death ensues it pays $60. It is not a life' insurance company within the meaning of section 2, chapter 34. We think that life, fire and marine insurance companies are the only ones contemplated by section 2. In answer to a question, we do^ not think that life, fire or marine insurance companies obtaining a certificate under section 2, chapter 34, have also to comply wih section 30, chapter 54, and get certificate under the latter section.

We conclude that accidnet insurance companies do not come under section 2, chapter 34 of the Code, so as to require the Auditor’s certificate therein specified. The Legislature has not yet so ordered. It has not yet seen fit to require of them $100,-000 capital invested. We cannot legislate. We cannot amend the statute.

After writing the above I discover that section 13, chapter 34, was amended by chapter 107, Acts 1901, so as to place a fixed license tax on foreign accident insurance companies. Until the act of 1901 they were not in that section by express specification. That section'says that if any company fails to make payment or report of business the Auditor shall not issue to the company the certificate mentioned in section 3 of chapter 34, and from this it may be argued that as foreign accident companies are brought under the license, they must obtain the Auditor’s certificate under section 2 just the same as life, fire and marine insurance companies, and have invested capital of $100,000. To so hold we must amend section 2 by inserting the word “accident,” and make it read, “It shall not be lawful for any officer or agent of any life, fire, marine or accident insurance company * * * * to take risks without the auditor’s certificate.” We must thus amend the section by implication; we must do what the legislature did do; nothing short of this will bring such result. The Legislature in 1901 selected certain sections of chapter 34 for amendment; but left section 2 untouched, Shall we amend it by inserting that word. The Leg-. Mature put it in one section, but not in the other. We cannot thus amend when the Legislature having the matter in hand has not done so. We must say that it intended to leave section 2 stand, and must -give it as left standing and section 13 as amended in 1901 each effect. Thus, we say that section 13 denies the auditor’s certificate to those companies in default required by section 2 to have such certificate; but that such companies as are not required by section 2 to have the certificate are not meant by that clause. Those companies not reporting business for license tax or not paying it are under section 14 which puts them and their agents under penalty of not less than $100. nor more than $1,000. The Act of 1901 did not, insert accident companies in section 2, because it did not intend to require of them proof of $100,000 assets.

The next question: Is the petitioner entitled to a certificate from the Secretary of State under section 30, chapter 54 of the Code? We think it is. That section says: “Any corporation duly incorporated by the laws of any state or territory of tire United States, or of the District of Columbia, or of airy foreign country, may, unless it be otherwise expressly provided, hold property and transact business in this state upon complying with the requirments of this section, and not otherwise.” The requirement is only that it file with the secretary of state a copy of its articles of association and of the law or authority under which it is incorporated. Then the Secretary issues a certificate of the fact of filing such documents, and this certificate operates by law to allow it to do its corporate business in this state. If however, the corporation is a railroad or other corporation doing business in this state as lessee of the works, franchise or property of another corporation, or person or otherwise, it must in addition to the document just mentioned file a paper sealed with the corporate seal accepting the provisions of section 30, and agreeing to be governed thereby. This is not required of any but such lessee corporation. The object of this provision is to prevent such lessee from escaping the liability imposed by that section on the plea that it is only a lessee. The section makes railroad corporations doing business in this state, as to property, works and operations, domestic corporations. It was the purpose to compel agreement to be so liable as a domestic corporation in demanding a corporate consent from such, lessee company. But this accident insurance company is not a lessee corporation operating works of another. The Legislature of 1893 considered that section 2, chapter 34, would not 'apply to guaranty companies as it put in a section making it apply to them. Code 1899, p. 121. What the Legislature ought to have done is one thing, what it did do is another. Only the Legislature can cure defects, a court cannot legislate.

Therefore we award the mandamus.

Writ Granted.