Williams v. Dickey

1951 OK 159, 232 P.2d 637, 204 Okla. 629, 1951 Okla. LEXIS 532

• Court: Supreme Court of Oklahoma
• Decided: May 29, 1951
• Docket: 34548
• Status: Published

Opinions

HALLEY, J.

Parties will be referred to in the positions they occupied in the court below..

The Pioneer Reverse Life Insurance Company of Oklahoma City, which is duly licensed to conduct a life insurance business in this state, gave written notice under section 140, Title 36, O.S. 1941, to the State Insurance Board, the defendant, of the appointment of the plaintiff to act as its agent, and the notice was accompanied by the written application of the plaintiff for a license to sell insurance on a form prescribed by the defendant. The defendant issued the license to plaintiff on May 1, 1949. On November 10', 1949, the defendants issued an order on the plaintiff to show cause why his agent’s license should not be revoked because of false answers made in his application for the license. A hearing was had before the defendants on the 23rd of December, 1949, and on the 29th of December, 1949, defendants made an order revoking the license of the plaintiff. This action was brought to restrain the defendants from canceling and revoking the license.

The record shows that the plaintiff made false answers to at least four questions in the application he made to the defendants. Question 14 of the application reads as follows: “State fully and in detail all the practical experience you have had as a life, health and accident agent. If none, write ‘none’ in table below,” and his answer was “None,” when in fact he had practical experience as an agent. Question 16 reads: “Have authorities of any state ever refused you a license?” His answer was “No,” when in fact he was denied a renewal of his license to sell in the State of Idaho on June 28, 1948, and he was refused a license by the State of Nebraska. To Question 17 which is as follows: “Has your license ever been suspended or revoked by any state?” his answer was “No,” in spite of the fact that the State of Idaho had refused to renew his license. To Question 19, which is as follows: “Have you ever been convicted of a . felony? If so, give details,” he answered, “No.” Yet the record showed his conviction in four separate felony cases in the State of Texas, two of which were for forgery and one for conspiracy. It was further shown that he was convicted of the crime of Cheats and False Representation in the State of New Mexico and sentenced to serve not less than four years nor more than five years in the State Penitentiary there. This sentence was suspended on condition he leave the state.

It is to be remembered that the act creating the Insurance Board and setting out the duties and authority of the Board was passed by the 1915 Legislature as House Bill No. 70, chapter 174, page 280 of the 1915 Session Laws, and is Title 36, §§131 to 151, O.S. 1941. It is a carefully drawn act and was made necessary by the fact that the former act controlling the licensing of insurance agents had been held unconstitutional by this court in the case of Welch, Insurance Com’r, v. Maryland Casualty Co., 47 Okla. 293, 147 P. 1046. No contention is made that the plaintiff was not given a hearing as required by section 140.

The plaintiff raises the following propositions:

“(1) The right to sell life insurance is a valuable right, and as such, is entitled to be treated as analogous to property rights.

‘‘(2) The Insurance Board has no inherent power to revoke plaintiff’s license, but must find such authority to revoke in the statutes delegating the power of the Board to act.

“(3) The court will refuse to extend statutes relating to revocation by judicial construction.

“(4) In the absence of statutory authority the Insurance Board was not entitled to revoke plaintiff’s license, even though said Board may have had the power to refuse to grant plaintiff a license in the first instance.

“(5) The Legislature did not intend to, nor was it authorized to require a character qualification in order to secure a license to sell life insurance.”

In our opinion, it is unnecessary to answer all of these propositions, in light of the statutory provision covering this matter, which is sec. 140, 36 O.S. 1941. The first sentence of subd. (b) in that section is as follows:

“The State Insurance Board, in determining if the agent is entitled to a license, shall take into consideration his experience in the insurance business, ability! to be a competent agent, and the general reputation and character ... as to honesty, integrity and responsibility.”

Clearly, in this case, the Insurance Board would have had the right to refuse the plaintiff a license to sell insurance at the time his application was submitted, if it had been given the true facts. Under subd. (c) of the same section, the right to revoke a license is given the Insurance Board. Certain grounds for revocation are set up. Fraud in procurement of the license is not one of them, but we believe that the right to revoke on that ground is implied in the act. We quote from 53 C.J.S., Licenses, §44, subd. (b):

“A license may be revoked for any reason that would have justified a refusal to issue it in the first instance, and it may be revoked for various acts of misconduct occurring after the license has been issued.”

This statement is sustained by Butcher v. Maybury, 8 F. 2d 155; Mahaney v. Cisco (Tex. Civ. App.) 248 S. W. 420; Commonwealth v. Briggs, 34 Pa. Dist. & Co. 97; In re Oleomargarine Licenses, 19 Pa. Dist. 927, 37 Pa. Co. 350; In re Revocation of Certificate of Registration of Scutt, 46 Dauph. Co. (Pa.) 196; and Arroyo v. Moss, 56 N.Y.S. 2d 29, aff. 56 N.Y.S. 2d 17, 269 App. Div. 824, aff. 295 N.Y. 754, 65 N.E. 2d 570. In Butcher v. Maybury, supra, the court made this statement:

“The power of the state to require a license implies the power to revoke a license which has been improperly issued.”

In Schireson v. Schaefer, 354 Pa. 458, 47 A. 2d 665, 165 A.L.R. 1133, the rule is laid down that the power of the state to require a license implies the power to revoke a license which, by reason of fraud in its procurement, was improperly issued; and there is an extensive note found at 165 A.L.R. 1138, which deals with this question and cites cases from 21 states which follow the rule that the licensing authority has inherent power to revoke a license obtained by fraud and misrepresentation. Three Oklahoma cases are cited in that note: Dean v. Stone, 2 Okla. 13, 35 P. 578; Gulley v. Territory, 19 Okla. 187, 91 P. 1037; and In re Mosher, 24 Okla. 61, 102 P. 705, 24 L.R.A. (N.S.) 530, and all sustain this power in the licensing authority.

The judgment is affirmed.

CORN, GIBSON, DAVISON, and JOHNSON, JJ., concur. ARNOLD, C.J., and WELCH and O’NEAL, JJ., dissent.