People ex rel. Equitable Fire & Marine Insurance v. Fairman

Headnote

Mandamus.—Power of. Superintendent of the Insurance Department to refuse Admission to Foreign Corporation.

—Superintendent’s Discretion, how Reviewed.

It seems, that mandamus does not lie to compel an official act to be performed in a particular way, different from that in which it has been performed, at least when there is no evasion of a positive duty.

If a mandamus' would lie to compel the superintendent of the insurance department of New York to do an act regarding the admission to this State of an insurance corporation of another State, it would be to consider the application of such a corporation, and to proceed to act upon such application; but whether the superintendent’s determination upon such application may be reviewed by certiorari or appeal,—Query.

The relator, an insurance corporation of Rhode Island, was chartered to do both- fire and marine insurances, both which classes of insurance can not be effected in New York by a corporation created under the laws of New York. The relator sought a mandamus to compel the superintendent of the insurance department to issue a certificate of authority to its agents to effect marine as well as fire insurances. Held, that a- mandamus should be refused.

The relator, an insurance corporation of Rhode Island admitted to New York State to do a fire insurance business, applied for a mandamus directed to Charles Gr. Fairman as superintendent of the insurance department of the State of New York, requiring him to issue a certificate of authority to relator’s agent, to do also the business of marine insurance within the State of New York.

It appeared from an agreed statement of facts that

the relator was a corporation created in 1860 under the laws of Rhode Island and authorized by its charter to .insure against risks, both of fire and marine casualties. In 1866 the relator obtained admission to do business as an insurer, in the State of New York, and from 1866 to 1870 the insurance department issued an authority to the relator’s agents to do the business of fire insurance only. In 1870, 1871 and 1872 the department issued certificates of authority to relator’s agents to do the business of both fire and marine insurance.

In 1872 the relator notified the department that its capital had become impaired and that it would no longer effect risks in the State of New York.

In 1873 the relator filed a new statement with the insurance department showing an unimpaired capital, whereupon the department again issued a certificate of authority to relator’s designated agent, enabling relator to effect fire insurance only in New York State. ' The relator did not then again apply for a certificate of authority to take marine risks ; ■ nor did it so apply from 1873 until 1881, when it designated an agent to do its business as a marine insurer and requested the superintendent of the insurance department to issue to such agent a certificate of authority to do such marine insurance. The superintendent refused to issue to the relator the certificate enabling it to do marine insurance. It was not made a ground of .objection to relator’s admission to do a marine insurance business that it had failed to comply with the insurance laws of New York, or that it was not in a condition of solvency. The superintendent asserted that he had a discretion under the law, to grant to, or to withhold from, foreign insurance companies the certificate demanded by relator, and that this particular superintendent had never issued certificates of authority to insurance companies of other States enabling them to effect both fire and marine insurance.

Thereupon the relator applied by motion to the supreme court for a peremptory writ of mandamus compelling the superintendent to issue a certificate of authority to relator to effect marine insurances in the state of New York. The court at special term, on April 13,1882, denied the relators motion for a mandamus, Avhich denial was subsequently affirmed on appeal, at a general term in the supreme court for the third department on February 10, 1883, and on the further appeal, by the court of appeals, on May 8, 1883. Neither the supreme court at general term nor the court of appeals rendered any further opinion than that reported below.

I. The writ of mandamus is the appropriate remedy (People ex rel. Lawrence v. Supervisors of Westchester, 73 N. Y. 173 ; People ex rel. Schenectady Astron. Observ. v. Allen, 42 Id. 404). The superintendent’s duty is ministerial, not judicial, as he has no discretion in this case (Laws 1859, c. 366 ; Laws 1853, c. 466, § 23, amended 1862, c. 367, § 5; Laws 1849, as modified by Laws, 1853, c. 463, § 22; Laws 1859, c. 366, §§ 3, 8).

II. The relator was admitted into this State prior to 1873, and in construing the original license to relator, it must be assumed that the business of insurance was a valid business recognized by the common law. Any statute regarding the original license, its duration and effect must be construed in reference to the principles of the common law (People ex rel. Osterhout v. Perry, 13 Barb. 206 ). The fact that the relator was required to file an annual statement and to take out a renewal certificate of authority did not define the duration of the original license to relator. The original license to do business, being for an indefinite time, was for the period of relator’s corporate existence or until the State by a general law shall otherwise limit the license.

III. The relator’s charter enabling it to effect both fire and marine insurances, in so far as'these chartered powers are consistent with the domestic policy of this State, the relator is entitled to have such chartered power recognized and protected by comity (Merrick v. Van Santvoord, 34 N. Y. 208 ).

IV. There is no manifestation of any policy on the part of the State to exclude foreign corporations simply because they effect both fire and marine insurances. The court should not imply such a policy from c. 490, Laws of 1879, acts relating to domestic insurance corporations only (Oakley 0. Aspinwall, 3 N. Y. 547 , 568). This would be to prohibit by inference a foreign corporation from pursuing a valid common law business, in this State. The principle of sovereignty has not gone so far as to raise a principle of exclusion by inference.

V. Chapter 593 of the Laws of 1873, conferring power on the superintendent in his judgment to refuse admission to any insurance corporation of another State, when such refusal shall best promote the interest of the people of this State, has no relation to the status of relator, as it was admitted prior to the passage of this act.

VI. Chapter 593 of the Laws of 1873 is in any event unconstitutional, because it delegates a legislative power to the superintendent of the insurance department (Barto v. Himrod, 8 N. Y. 483 , 491, 492; Bradley v. Baxter, 15 Barb. 123 ).

I. The issuance or refusal of a certificate or a renewal certificate of authority is a matter of discretion with the superintendent of insurance {Laws 1853, c. 463, § 22 ; Id. c. 466, § 28 ; Laws 1873, c. 593, § 2). Mandamus can compel action,' but it cannot control discretion (Hutchinson v. Comm’r of Canal

Fund, 25 Wend. 692 ; 26 Id. 658 ; 18 Id. 78 ; People ex rel. Taylor v. Brennan, 39 Barb. 522 , 651).

II. The relator was not admitted to do business in this State, for more than one year (vide Hartford Life and Ann. Ins. Co. v. Fairman,' decided special term, September, 1882); but even if it was originally admitted for a longer term the relator voluntarily retired from this State in 1872, and when it was re-admitted in-1873, it was only permitted to do fire insurance business, and it has never since effected marine risks.

* III. The doctrine of comity will not admit this company to do a class of business prohibited to New York corporations by the statute of New York. The admission of foreign insurance companies is an act of indulgence (Paul v. Virginia, 8 Wall. 166 ) and not of right.

IV. The superintendent is forbidden by law (Laws 1879, c. 490, § 2) to issue the certificate sought.