State ex rel. Sheets v. Aetna Life Insurance

1 Ohio Law Rep. 835, 69 Ohio St. (N.S.) 317

• Court: Ohio Supreme Court
• Decided: January 5, 1904
• Status: Published

Opinion

It is admitted in this case that the defendant, The Aetna Life Insurance Co., is a corporation duly organized under the laws of the state of Connecticut. That by its charter and the amendment thereto it is authorized and empowered to take insurance risks on life and against accidents to persons, and to engage in the business of “indemnifying employers against loss or damage for personal injury or death, resulting from accidents, to employes or persons other than employes;” and it affirmatively appears from the allegations of relator’s petition that for more than ten years last past said defendant company has been transacting in this state the business of life insurance; that on June 24, 1902, said company having complied with the statutory requirements regulating foreign corporations doing an employers’ liability insurance in this state, there was issued to it by the superintendent of insurance of the state of Ohio a license authorizing and empowering it to engage in such insurance in this state, and that since said twenty-fourth day of June, 1902, said defendant company has been and now is carrying on within this state said business of employers’ liability insurance. No question is made as to the charter powers of the defendant company; these are conceded, but it is contended by the relator that said company being a life insurance company, and being now actively engaged in transacting the business of life insurance in the -state of Ohio, may not therefore lawfully be licensed or permitted to carry on or continue the business of employers’ liability insurance within this state. In support of this contention it is argued: 1. That the statutes of Ohio do not authorize life insurance companies to transact both a life and employers’ liability insurance. 2. That a corporation formed under the laws of another state and transacting the business of insurance in Ohio, is only permitted to engage in such kind of insurance in this state as a domestic corporation is authorized to transact. We shall consider these propositions in the order named.

1. Section 3596, Revised Statutes, prescribes and defines the kind of business that may be done and the character of risks that may be taken by a company or corporation organized or incorporated under the laws of another state and engaged in transacting the business of life insurance in this state. That section, so far as its privisions are pertinent to the present inquiry, reads as follows:

“ * * * No company * * * organized or incorporated by act of congress, or under the laws of this or any other state of the United States, or by any foreign government, transacting the business of life insurance in this state, shall be permitted or allowed to take any other kind of risks except those connected with, or appertaining to making insurance on life or against accidents to persons, * * * . ”

This section substantially in its present form was first enacted in 1888. Prior thereto life insurance companies, whether foreign or domestic, doing business in this state, were not authorized to take any other kind of risks than those connected with or appertaining to making insurance on life. By the amendment of March 27, 1888, the authority of such companies was so far enlarged and extended as to permit and allow them not only to make insurance on life, but to permit them to take risks and make insurance connected with or appertaining to accidents to persons. This section was again amended May 2, 1902 (95 O. L., 355), when it took its present form, but no change or modification was made thereby as to the right of the companies therein named to insure against accidents to persons.

While the language of this section is that of regulation and restriction 'rather than of affirmative grant, nevertheless the language therein employed, by clearest implication, recognizes the right and' would seem to confer upon and invest companies of the character of the defendant company, with full authority to make insurance and take risks in any wise connected with or appertaining to accidents to persons; otherwise the Legislature would not have undertaken to designate and define the character of accidental risks that might be taken by such companies. When, then, the defendant company is clothed with authority to engage in the business of employers’ liability insurance within this state, depends upon whether or not that particular kind of insurance is embraced and included in the authority so given and permitted, to make insurance and take risks connected with and appertaining to accidents to persons. If it is, then admittedly the defendant, in making such insurance, was and is acting clearly within the scope of its delegated powers. That this kind of insurance, employers’ liability insurance, may from its very nature appropriately be classified with and peculiarly belongs to what is commonly known and designated as accident insurance, must, we think, be conceded inasmuch as such insurance has for its primary purpose indemnification against the effects of accidents resulting in bodily injury or death. It is said by Barker, J., in Employers’ Assurance Corporation v. Merrill, 155 Mass., 406:

“In one sense, there can be no doubt that an employers’ liability policy is accident insurance. Such policies cover accidents to others than the assumed, but the assured must stand in such a relation to the person accidentally injured or killed as to be legally liable for the result of the accident, and it is only an accident causing bodily injury or death which creates a right to the insurance.”

But it is argued by relator that this character of insurance is not within the provisions of Section 3596, and could not have been within the contemplation of the Legislature at the time Section 3596 was enacted, for the reason, as claimed, that such insurance was then unknown in this state. This statement is challenged by counsel for defendant who assert that employers’ liability insurance was not only known, but was extensively written in Ohio for several years prior to the enactment of this statute. Whatever the fact may be as to this, if the language employed in Section 3596 is sufficiently comprehensive in character to include such insurance, then under the established rules of construction it must be held to authorize and permit it. In Endlich on the Interpretation of Statutes, Section 112, the rule is stated thus:

“Except in some few cases where a statute has fallen under the principle of excessively strict construction the language of a statute is generally extended to new things which were not known and eould not have been contemplated by the Legislature when it was passed. This occurs when the act deals with a genus, and the thing which afterwards comes into existence is a species of it.”

And this rule of statutory extension has been recognized and followed by this court in numerous cases. In Corwin v. Benham, 2 Ohio St., 43, Ranney, J., says:

“I am aware that the usual import of words is sometimes to be restricted, when it would otherwise obviously extend beyond the subject matter and spirit of the whole enactment. But this can not be done because the Legislature did not foresee or contemplate every case upon which it might operate.

“The wisest legislators would fall far short of such foresight. If within the language, it must appear clearly to the court that the case would have been excluded from its operation if foreseen.”

And in Stetson v. Bank, 2 Ohio St., 175, speaking of this rule, it is said:

“Palling within the positive provisions of the law, it is not epough' to exclude this case from its operation to say it was not contemplated when the law was enacted. We must be able to see some reason to suppose it would have been excluded in positive terms, if it had occurred to the minds of the Assembly at the time. ’ ’ To the same effect are Goshorn v. Purcell, 11 Ohio St., 649; Morris v. Williams, 39 Ohio St., 558; and Railway Co. v. Telegraph Assn., 48 Ohio St., 423.

A further reason assigned by relator why foreign life insurance companies may not be permitted to do an employers ’ liability insurance in this state is, that by Section 36415, Revised Statutes, insurance companies other than life have been specially authorized and empowered to transact this kind of business in Ohio,‘thereby it is argued, manifesting a legislative intent to limit and restrict the transaction of such insurance business in this state to companies other than life. If we are right in the conclusions above reached, this contention is sufficiently answered by the fact that employers’ liability insurance is in-eluded in the provisions of Section 3596, permitting insurance against accidents; and the right of life insurance companies to make such insurance is in no wise affected or modified by the provisions of said Section 36415, which was subsequently enacted.

There can be no doubt as to the power of the Legislature to prescribe the terms and conditions upon which foreign corporations may be admitted to do business in this state, or of its right to define the kind of business that may be done by such corporations. It was held in Western Union Tel. Co. v. Mayer, 28 Ohio St., 521, that:

“Foreign corporations can exercise none of their franchises or powers within this state, except by comity or legislative consent. That consent may be upon such terms and conditions as the General Assembly under its legislative power may impose.”

However, a consideration of the legislation in Ohio touching the rights of life and accident insurance companies organized under the laws of another state and doing business in this state, will show that it has not been and is not the policy of our law to discourage or prohibit such companies from engaging in or doing an accident insurance business in this state; nor can there be found any statutory inhibition whereby the right of such companies to insure against accidents, is limited or restricted to risks by accident to the person assured, but on the contrary the right conferred is to take such risks as are in anywise connected with or appertaining to accident to persons. It follows, therefore, that so long as the defendant company confines itself to insurance against accidents to persons, and its contract is one to indemnify the assured against loss by accidental injury to a person in whom the assured has an insurable -interest, because legally liable for the results of such accident, that such risk is clearly one “connected with and appertaining to accidents to persons,” and is therefore within the legitimate scope of the power and authority possessed by such company by virtue of Section 3596, Revised Statutes.

2. The conclusion above reached, viz., that under favor of Section 3596 life insurance companies may rightfully be licensed and permitted to transact within this state the business of employers’ liability insurance, is sufficient to determine-the only question presented in this case, and renders unnecessary a consideration of relator’s second proposition. However, referring to the claim made upon this proposition, we may say: That inasmuch as the business of employers’ liability insurance is not unauthorized or prohibited in Ohio, but such business is expressly recognized and permitted by our statutes, we incline to the view that in the absence of affirmative statutory provision prohibiting life insurance companies from engaging in such business, that a life insurance company organized under the laws of a sister state and authorized by its charter to write employers’ liability ’ insurance, may by the law of comity be licensed and permitted to write such insurance in this state upon complying with the requirements of the statutes of this -state as to deposits, etc., even though the right to transact that particular kind of insurance may not have been exercised by, or conferred upon domestic life insurance companies by positive statutory grant. If the business is within the charter powers of such foreign company, it is enough that such business is not prohibited in this state, is not obnoxious to the policy of our laws, and is not against the interests of our citizens. It is said by the Supreme Court of Illinois in People v. The Fidelity and Casualty Co., 153 Ill., 25:

. “The rule is, that where there is no positive prohibitive statute, the presumption, under the law of comity that prevails between the states of the Union, is that the state permits a corporation organized in a sister state to do any act authorized by its character or the law under which it is created, except when it is manifest that such act is obnoxious to the policy of the law of this state. ’ ’

Again, in Colwell v. Springs Co., 100 U. S., 55, it is said:

“If the policy of the state or territory does not permit the business of the foreign corporation in its limits, * * * it must be expressed in some affirmative way; it can not be inferred from the fact that its Legislature has made no provision for the formation of similar corporations,” etc.

The views thus expressed are in harmony with our laws' and in accord with the recognized policy of this state. As said in argument by counsel for defendant in this case, “it is not the policy of this state to repel or discourage solvent, reputable foreign corporations from doing business within its borders, and the courts will not anxiously seek an excuse in the statutes to drive them out.”

We are of the opinion that the facts stated in the petition in this case are not sufficient in law to entitle the relator to the relief and judgment therein asked. The demurrer of defendant is therefore sustained and the petition of relator dismissed.

Judgment accordingly.