Title Guaranty & Surety Co. v. McAllister

200 N.E. 831, 130 Ohio St. 537, 130 Ohio St. (N.S.) 537, 5 Ohio Op. 183, 1936 Ohio LEXIS 358
CourtOhio Supreme Court
DecidedMarch 18, 1936
Docket25526
StatusPublished
Cited by10 cases

This text of 200 N.E. 831 (Title Guaranty & Surety Co. v. McAllister) is published on Counsel Stack Legal Research, covering Ohio Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Title Guaranty & Surety Co. v. McAllister, 200 N.E. 831, 130 Ohio St. 537, 130 Ohio St. (N.S.) 537, 5 Ohio Op. 183, 1936 Ohio LEXIS 358 (Ohio 1936).

Opinion

Zimmerman, J.

Part Second, Title IX, Division III, of the General Code of Ohio, is captioned “Insurance Companies.” Subdivision II, of Division III, relates to “Insurance Upon Property and Against Certain Contingencies, ’ ’ and Chapter I, of Subdivision II, contains the “General Provisions” pertaining to insurance of that class.

Chapter 1 includes Sections 9510 and 9561, General Code. Section 9510 follows immediately after the heading “Insurance Authorized,” and provides:

“A company may be organized or admitted under this chapter to— * * * guarantee the fidelity of persons holding places of public or private trust, who are required to, or, in their trust capacity do receive, hold, control, disburse public or private moneys or property * * #.”

It is therefore plain that guaranty and surety companies are within the general classification of “Insurance Companies.”

Tracing the history of Section 9561, General Code, restricted to foreign insurance companies, through 75 Ohio Laws, 572 (1878), and 97 Ohio Laws, 159 (1904), it is apparent that it was intended to cover “Foreign insurance companies other than life.” Both acts are so entitled.

Section 9561, General Code, reads as follows:

“Any such company desiring to transact business by an agent in this state, shall file with the superintendent of insurance a written instrument, duly signed and sealed, authorizing any of its agents in Ohio to acknowledge service of process therein for and in behalf of the company, consenting that service of process, mesne or final, upon any agent, shall be as valid as if served upon the company according to the laws of this *542 or any other state or country, and waiving all claim or right of error by reason of such acknowledgment of service; also, consenting that suit may be brought against it in the county where the property insured was situated, or was insured, or the application for insurance taken, and that service of process made therein by the sheriff of such county, by sending a copy thereof by mail, addressed to the company at the place of its principal office located in the state where it was organized, or, if it is a foreign company, to it at the-place of its principal office in the United States, at least thirty days prior to taking judgment in such suit, shall be as valid as if personally made upon the company according to the laws of this state; or any other state or government; also, if suit be brought against it after it ceases to do business in this state, and there is no agent of the company in the county in which it is brought upon whom service of process can be made that service upon it may be had by the sheriff sending a copy thereof, so mailed, and within such time. But the sheriff’s return must show the time and manner of such service.”

The quoted section embraces the only reference to service of process upon foreign insurance companies, including those engaged in the surety and guaranty business, within the confines of such Chapter 1.

Among the stipulations in the “Agreed Statement of Facts” are the following:

“1. That the defendant, The Title Guaranty & Surety Company, is, and at all times mentioned in the petition was, a corporation, organized and existing under and by virtue of the laws of the state of Pennsylvania.
“2. That said company is, and at all times mentioned in said petition, was, organized for the purpose of and engaged in the business of guaranteeing the fidelity of persons holding places of public or private *543 trust, who are required to, or in their trust capacity-do, receive, hold, control or disburse public or private monies and of executing and guaranteeing bonds and undertakings required or permitted in all actions or proceedings or by law allowed.
“3. That on the fourteenth day of July, 1904, said company registered itself with the superintendent of insurance of the state of Ohio and qualified under the laws of Ohio for the purpose of doing business in the state of Ohio. In accordance with Section 9561 of the General Code of Ohio, it filed with the superintendent of insurance of the state of Ohio the instrument required of it by said Section 9561 and each year thereafter filed such instrument to and including the year 1913 and again filed such instrument with the superintendent of insurance in the year 1916 but no such instruments were filed by it with the superintendent of insurance thereafter. A copy of said instrument filed in the year 1913 is hereto attached, marked ‘Exhibit A’ and made a part hereof, and said instruments filed in the other years above stated were identical with said Exhibit A with the exception of the respective dates of the same.
“4. That said company on November 15, 1913, ceased doing business and discontinued its offices and cancelled its agencies in the state of Ohio, without filing any formal notice of withdrawal with the superintendent of insurance. * * *
‘ ‘ 7. That said company did not at any time take any procedure to qualify as a foreign corporation in the office of the secretary of state.”

“Exhibit A,” referred to, shows almost a verbatim compliance with Section 9561, General Code. The name of plaintiff in error is given, with the number and street of' its principal office in Scranton, Pennsylvania.

There can be no doubt of the efficacy and binding force of the waivers and consents filed under Section 9561, General Code, by foreign insurance companies.

*544 The right of a state to exclude foreign corporations from doing business within its borders is well established. In admitting such corporations, the state may therefore prescribe by statute the conditions under which they may enter and do business. Accordingly, by coming into the state and subjecting themselves to the imposed conditions, such corporations cannot subsequently escape or evade the consequences. 10 Ohio Jurisprudence, Section 908, page 1182; Ouelette v. City of New York Ins. Co., 133 Me., 149, 152, 174 A, 462, 463.

Plaintiff in error presents no exception to this general rule, and when it came into this state to do business and filed the consents and waivers with the superintendent of insurance under Section 9561, General Code, it was bound thereby so long as it had outstanding obligations or liabilities which were incurred during its transaction of business in Ohio. See Volume 2, Couch Cyclopedia of Insurance Law, Section 553, page 1761.

Any cause of action against plaintiff in error on the bonds in question accrued on July 13, 1917, when the final account of S. C. Daniel, guardian, was settled by the Probate Court, and a sum certain was found to be due and owing from him. Newton v. Hammond, 38 Ohio St., 430.

Defendant in error filed her petition on November 12, 1920. The only process issued for plaintiff in error upon which return was made prior to 1934 was that in 1924, showing service upon the Secretary of State. Was such service of any effect?

It is contended by counsel for defendant in error that it was good under Section 181, General Code.

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Bluebook (online)
200 N.E. 831, 130 Ohio St. 537, 130 Ohio St. (N.S.) 537, 5 Ohio Op. 183, 1936 Ohio LEXIS 358, Counsel Stack Legal Research, https://law.counselstack.com/opinion/title-guaranty-surety-co-v-mcallister-ohio-1936.