Insurance Co. v. Kennedy

96 Tenn. 711

• Court: Tennessee Supreme Court
• Decided: June 11, 1896
• Status: Published

Opinions

John T. Allen, Sp. J.

This is an action by the New Hampshire Insurance Company against W. PI. Kennedy and P. B. Jones, commenced before a Jus^ tice of the Peace, on a note executed by defendant,. Kennedy, June 21, 1894, "made due and payable September 1, 1894, for $248.42, indorsed by defendant, Jones. The Justice gave judgment for said company against defendants for the amount of said note, protest fees, and' the cost, and defendants appealed from said judgment to the Circuit Court, where said suit was tried by the ■ Judge, without a jury, which resulted in a judgment against said company for the cost of suit, the Court holding that said note was based on an illegal consideration, and was void. Plaintiff in error appealed in the nature of a writ of error to this Court, and has assigned errors to the holding of the Circuit Court.

Plaintiff in error is a foreign corporation, and, in 1891, began to do business in the city of Memphis, and established an agency there, and it constituted and appointed defendants to act as such agents, and, through defendants as such agents, plaintiff in error did a large business in Memphis up to June 30, 1893, when plaintiff in error terminated said agency, and withdrew from this State, refusing to file a copy of its charter with the Secretary of the State, and to have an abstract of its charter registered in Shelby County, as required by Chapter 122 of the Acts of 1891.

It was a part of the original contract of agency between plaintiff in error and defendants that defendants, as such agents, should be responsible for and pay to said company the premiums on all policies issued by them, and they were to settle every sixty days; and • they, as such agents, had to .be responsible for all uncollected premiums, and were required to account every sixity days for premiums on all policies issued, whether they had collected the same or not.

On settlement with said company, after the termination of said agency, defendants were indebted to said company to the amount of $1,248.42, and defendant, Jones, gave his note for $1,000, and defendant, Kennedy, gave the note sued on, indorsed by said Jones. Both of said notes were given for uncollected premiums on policies issued by said company through said agents in the city of Memphis after said Act of 1891 went into effect, and in violation of the provisions of said Act.

Section' 3 of said Act provides: ‘ ‘ That it shall be unlawful for any foreign corporation to do, or to attempt to do, any business, or to own or to acquire any property in this State, without having complied with the provisions of this Act, and a violation of this statute shall subject the offender to a fine, ’ ’ etc.

Plaintiff in error being a foreign corporation, after said Act went into effect, and, by its failure and refusal to comply with the requirements of said Act, it was not authorized to do any business or to own or acquire any property in this State, and. all business transacted by said company in Memphis, and all contracts made by said company in the course of its business in the city of Memphis after said Act went into effect were illegal, and prohibited by said statute, and said company could not have sued the policy holders for any uncollected premiums on policies issued in violation of said statute, and recover the same. State v. Phœnix Insurance Co., 8 Pickle, 420; Lombard Lumber Co. v. Thomas, 8 Pickle, 593; Haworth v. Montgomery, 7 Pickle, 16; Stevenson v. Ewing, 3 Pickle, 46.

It is well settled in this State that all contracts which are prohibited by statute are void, and will not be enforced by the courts. Ib.; Isler, Admr., v. Brunson, 6 Hum., 277, and cases cited (Cooper’s Ed.).

The note here sued on being for uncollected premiums on policies issued by plaintiff in error when it was prohibited by said Act of 1891 from doing any business in this State, the same is illegal and void, and cannot be ' collected. Bates v. Watson, 1 Sneed, 377; Parker v. Cowan, 1 Heis., 520.

The Circuit Court dismissed this suit, and the judgment is affirmed.