Commercial Union Assurance Co. v. Smith — 18 N.Y. St. Rep. 151

Majority

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The Commercial Union Assurance Company, Pl’ff, v. Morris H. Smith et al., Def'ts.

(Supreme Court, Special Term,, New York County,

Filed October 1, 1888.)

Headnote

1. Injunction—Right to corporate name.

The statute, Laws 1887, chap 211, was intended to prevent any fire insurance company from using the seal or title of any other fire insurance company or any life insurance company from using the seal or title of any other life insurance company. The object of the act is more particularly to prevent an improper diversion of business, growing out of confusion or uncertainty on the part of the public by reason of a similarity of corporate title.

2. Same—Mere similarity of name alone not sufficient to justify injunction.

The use of the same name will not be enjoined where the parties are doing business thereunder, entirely dissimilar and distinct. The mere similarity of name standing alone will not be sufficient to justify the interposition of the equitable power of the court, but it is only in cases where the similarity of name or the manner of its use would produce confusion and uncertainty concerning the name calculated to injuriously affect the identity and business of the corporation which has acquired the first right to use such name.

3. Same—When injunction denied.

The “ Commercial Union Assurance Company” (Limited), is a foreign corporation, existing under the Laws of Great Britain, having the right under such Laws (but not of this state) to carry on the business of life, fire and marine insurance It has no right under the Laws of this state to engage in any other than the fire insurance business The defendants desirous of forming a life insurance company selected the name of “ Com mercial Life Insurance Company,” and commenced doing business. The plaintiff asks an injunction to prevent the use of the name, Held, that the titles in question are not sufficiently similar to mislead any one or to injure the plaintiff irrespective of the question that the plaintiff only does a fire and marine insurance business, while the defendant company is to engage in life insurance and annuity benefit only, and an injuction should be denied.

Butler, Stilman & Hubbard, for plt’ff; Johnes & Wilcox, for def’ts.

This is a motion by plaintiff to make permanent a temporary injunction restraining the defendants from using or attempting to use the words “ Commercial Union ” in their title. “ The Commercial Union Assurance Company " (limited), is a foreign corporation, created and existing under the laws of Great Britain, having the right under such laws, but not of this state, to carry on the business of life, fire and marine insurance. In 1871, it was permitted to engage in the fire insurance business in this state, and it now has no right under the laws then and now existing in this state to engage in any other than the fire insurance business.

In 1888, the defendants, desirous of forming a life insurance company, on conference with the superintendent of insurance selected the name “ Commercial Union Life Insurance Company of New York,” and commenced doing

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business. The plaintiff asks the equitable interposition of this court, by an order of injunction, on two grounds, the

First. Under the statute applicable to the case.

Second. Under established rules of law entitling the plaintiff to protection against the injury likely to result from the use, by other parties, of a business name so similar to that devised and used by it as its own, so as to be liable to mislead the public.

The statutes relied upon (chapter 211 of the Laws of 1887), provide, that “ no fire, life, marine or other insurance company herein organized under the laws of this state, shall use a corporate name or title which shall, at the time of such organization, be used to designate a fire, life, marine or other insurance company already existing under the laws of this state, and it shall be the duty of the superintendent of the insurance department to reject any name which he shall deem to be so nearly similar to any already in use, as to lead to confusion or uncertainty on the part of the public.” Whether we regard the plaintiff as a corporation existing under the laws of this state or not, I am inclined to adopt the construction of this statute as given by the insurance department, namely: “ That the statute was designed to prohibit the adoption by the incorporators of an insurance company of a title too closely resembling that of a corporation already organized for the purpose of insurance, similar in character to that proposed to be maintained by the incorporators. The object of the act is more particularly to prevent an improper diversion of business growing out of confusion or uncertainty on the part of the public by reason of a similarity of corporate titles.

It would seem, then, that this státute was intended to prevent any fire insurance company from using the seal or title of any other fire insurance company, or any life insurance company from using the seal or title of any other life insurance company. In other words, that no company should use the name of another company in the same line of business, for such would result in confusion and uncertainty on the part of the public, by reason of a similarity of corporate titles, and injure the company first assuming the seal and title by a diversion of its business. Apart from the statutes, therefore, is plaintiff, under what law, entitled to protection by injunction pendente lite against injury likely to result from the use by defendant of the corporate name selected, and is it a similarity such as to be likely to mislead the public ?

In a case lately considered (Farmers’ Loan and Trust Co. v. Farmers’ Loan and Trust Co. of Kansas), an effort was made to collate some of the authorities and analyze the principles underlying them bearing upon this subject, and reference to that case renders it unnecessary to refer to the cases therein cited. In many respects there is a great

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similarity between the two cases, and as therein stated, “a name, whether of an individual or corporation, as well as any other mark or symbol, will be protected in a proper case, and that irrespective wbiether such name is an arbitrary one or not, if the other considerations entitling it to such protection are present.” That the use of the same name would not be enjoined where the parties were doing business thereunder entirely dissimilar and distinct, as, for instance, where one represented a banking business and another a locomotive works. The mere similarity in name, therefore, standing alone, would not be sufficient to justify the interposition of- the equitable powers of the court, but it is only in cases where the similarity of name, or the manner of its use, would produce confusion or uncertainty concerning the name, calculated to injuriously affect the identity and business of the corporation which has acquired the first right to use such name.

I do not think that the titles here in questions are sufficiently similar to mislead anyone or to injure the plaintiff, irrespective of the question that the plaintiff only does a fire and marine insurance business, while the defendant company is to engage in a life insurance and annuity business only. The affidavits ahow that there are many fire insurance companies having precisely the same name as other life insurance companies. For instance, the Etna Life and the Etna Fire, the Home Fire and the Home Life, etc. And the affidavits of officers of such companies state that no uncertainty or confusion arises by reason of such fact. It is moreover stated by the defendants that there was no intention to copy the name of the plaintiff, and the fact that they are engaged in business dissimilar in character shows that no attempt has been made to divert the business of plaintiff or deceive the public. Hor is any direct injury to plaintiff shown.

The Code provides (section 603), that when it appears from a complaint, “that the plaintiff demands and is entitled to a judgment against the defendant restraining the commission or continuance of an act, the commission or continuance of which during pendency of the action will produce an injury to the plaintiff, an injunction order may be granted to restrain it.”

I am unable to see from the affidavits, how any injury ■can result to plaintiff from the use of the name during the pendency of the action, whatever may be the effect of the testimony as produced upon the trial. The plaintiff is prevented by the law of this state from engaging in the business of life insurance, which is the only business proposed to be carried on" by defendant, and the use of the name during the pendency of the action will not result in any diversion of plaintiff’s business. The affidavits, therefore, not

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being sufficient to show bad faith on the part of the defendants in the selection of the name and for the reasons that the business engaged in by the plaintiff is entirely different from that of the defendant, and that injury will not result to the plaintiff during the pendency of the action, and that it has not been shown that the public will be nqisled or deceived, the motion to make the temporary injunction permanent, should be denied.