State Board of Insurance v. Republic National Life Insurance Co.

384 S.W.2d 369, 1964 Tex. App. LEXIS 2374
CourtCourt of Appeals of Texas
DecidedOctober 21, 1964
Docket11271
StatusPublished
Cited by6 cases

This text of 384 S.W.2d 369 (State Board of Insurance v. Republic National Life Insurance Co.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State Board of Insurance v. Republic National Life Insurance Co., 384 S.W.2d 369, 1964 Tex. App. LEXIS 2374 (Tex. Ct. App. 1964).

Opinions

HUGHES, Justice.

The Trial Court upon sworn petition by Republic National Life Insurance Company and after appearance by appellant, the State Board of Insurance of the State of Texas, and after hearing, both parties being represented, issued a temporary injunction the material portions of which are:

“ * * * it appearing that the plaintiff is entitled to the temporary injunction as herein granted, same being within its allegations and prayer, for the reasons that the Commissioner of Insurance and the State Board of [371]*371Insurance of the State of Texas, defendant, have issued, and approved the issuance of, a certificate of authority to Great Republic Life Insurance Company to transact a life insurance business in the State of Texas and such action will result in the immediate commencement of competitive business between Great Republic Life Insurance Company and Republic National Life Insurance Company, and it appearing that such commencement of business by these companies in Dallas, Texas, and elsewhere, in view of the similarity of names, will result in confusion and misleading of the public, and that the State Board of Insurance of the State of Texas, defendant, in approving the issuance of such certificate of authority has acted in disregard of Articles 3.02 and 3.06 of the Texas Insurance Code (V.A. T.S.) and Article 2.05 of the Texas Business Corporation Act (V.A.T.S.), and that the issuance of such certificate and the operations by Great Republic Life Insurance Company will result in irreparable and inestimable damage to the plaintiff; and that the plaintiff in said hearing has made a proper showing of a probable right and probable injury of the matters in the temporary injunction prayed for; it further is the holding of the Court that the appeal taken by plaintiff herein will be tried ‘de novo’ rather than under the substantial evidence rule and therefore any action of the State Board of Insurance or the Commissioner of Insurance purporting to approve or authorize the use of the name ‘Great Republic Life Insurance Company’ or to authorize a certificate of authority issued in that name is totally void and a nullity; that no company may use that name as a matter of law and if any such company attempts to do so it will be without legal authorization of the proper authorities of the State of Texas and the temporary mandatory injunction granted herein is proper on that basis;
“It is Accordingly Ordered, Adjudged and Decreed that the clerk of this Court issue a writ of temporary mandatory injunction pending final hearing and determination of this cause ordering the State Board of Insurance of the State of Texas, defendant, to take any and all action necessary to recall and cancel certificate of authority No. 3339, purportedly authorizing Savings and Security Life Insurance Company to operate under the name ‘Great Republic Life Insurance Company’, provided that the plaintiff shall,, prior to the issuance of such injunction, file with the Clerk a bond executed by it in the amount of Five Thousand ($5,000.00) Dollars payable as required by law, with good and sufficient surety, approved and conditioned as the law requires; all of which is subject to the further order of the Court.”

Appellee posted bond as required and the injunction ordered has been issued and served upon proper parties.

The Board’s first point is that the Court erred in issuing an injunction, mandatory in form, to compel official action by it..

We overrule this point upon the authority of Texas Practice, Lowe and Archer,. Sec. 330 from which we quote:

“Mandatory injunctions may be either temporary or permanent.
“A temporary mandatory injunction will issue only for the purpose of maintaining or restoring the status-quo pending final hearing. While it is often said that a mandatory injunction, particularly a temporary mandatory injunction, should not be granted except with great caution and only in¡ cases of extreme hardship when the necessity for the relief is manifest,, the Texas courts do not hesitate to-issue the writ when it is essential to* [372]*372remedy a wrong and no other adequate means of effecting the needed relief exists. * * * Should it become necessary to preserve the status quo by requiring action instead of rest pending such hearing, a mandatory injunction would be authorized since a prohibitory injunction would be ineffective.”

The quoted text is well supported by authorities.

The Board’s second point is that the Court erred in ordering cancellation of the Certificate of Authority contrary to the statutory provisions governing such cancellation.

The Board cites, in particular, Art. 1.14 of the Texas Insurance Code, V.A.T.S. This Article provides for the issuance of certificates of authority to persons engaged in the insurance business upon compliance with its conditions which certificate * * shall be in full force and effect until it is revoked, canceled or suspended according to law; * * This Article also provides for the revocation of such Certificate of Authority for certain reasons as do Arts. 1.15 and 3.55 of the Insurance Code. Both Arts. 1.14 and 1.15 contain appeal provisions to the effect that the institution of suit as authorized operates to stay the order appealed from unless the Court otherwise directs, and provides that the trial shall be de novo as in other civil cases. These articles also give the reviewing Court plenary authority over the action of the Board in the premises.

Appellee predicates its appeal upon the provisions of Art. 1.04, Insurance Code. This Article provides that relief from any ruling of the State Board of Insurance by any dissatisfied insurance company or other party at interest may be had by filing a petition in the District Court of Travis County and that such “action shall not be limited to questions of law and the substantial evidence rule shall not apply, but such action shall be tried and determined upon a trial de novo” as in cases of appeal from the Justice Court to the County Court.

Article 1.04 does not specifically provide that an appeal under its terms has the effect of annulling the order or ruling which is the subject of the appeal but the law gives it such effect. Southern Canal Company v. State Board of Water Engineers, 159 Tex. 227, 318 S.W.2d 619.1

No insurance company should be permitted to do business under a Certificate of Authority which has been nullified, and ap-pellee, on default by the Board, had the right to seek protection from unlawful competition by Great Republic Life Insurance Company and the Trial Court had authority to grant such protection upon proper showing.

Answering directly the Board’s point, the Court in directing cancellation of the Certificate of Authority issued to Great Republic Life Insurance Company was in accordance with and declaratory of the legal consequence of a proper appeal from the action of the Board. The real substance of the Court’s order was its direction to the Board to recall the Certificate of Authority issued to Great Republic Life Insurance Company and by so doing to put an end to its unlawful operation thereunder. Point two is overruled.

The Board’s third point is that the Court erred in holding that appellee had exhausted its administrative remedies in regard to cancellation of the Certificate [373]

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Bluebook (online)
384 S.W.2d 369, 1964 Tex. App. LEXIS 2374, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-board-of-insurance-v-republic-national-life-insurance-co-texapp-1964.