The New York herald., 1874-11-25
'sTHE DOUBTFUL TRUST COMPANY.
Arguments Of Counsel Oh the Application for
the appointment Of Trustee.
A QUESTION OF CONSTITUTIONAL LAW.
Anxiety Of the Corporation Regarding
the Vested Rights Of Policy Holders
NEW HAVEN. Conn.,, Nov. "a,

| The Superior Court room was filed this morn
| ing by bankers, lawyers and insurance men from
this city and other parts OF the State to listen to
the arguments in the case OF Commissioner Sted-
man In his application Tor the appointment: OF
trustee VS.. The American National Lie and Trust
Insurance Company, before Judges Bradley and
Beardsly. sitting as special Court. Messrs.
I. E. Doolittle John S. Beacn and Dexter r.
Wright represented the company, and Henry
B. Harrison the Commissioner. Mr.. BENJAMIN
Noyes, President, and the officers and Directors
OF the company were also present In opening the
argument to sustain the plea that the law under
which the application Tor trustee was made was
unconstitutional, Colonel Wright said:-
ARGUMENT FOR THE COMPANY.
The statute proposes to seize our property and
franchise without due process OF law. lie
did not deny that the corporation came
within the corporations that might be
proceeded against under the statute. nor
aid he deny that the commissioner was regularly
appointed, but he did claim thar the petition Is
brought under and upon the twenty nth section
Of the act OF 1871 His Interpretation OF this
ton was that II 1t appears that the assets of any
company are less than three-ourths OF It's habii-
ties the commission must forthwith draw his pc.
titlon and file the same in the Probate Court. A
mandate Is also laid upon the Court. The language
OF the statute is that the Court shall thereupon
appoint trustee, leaving tne Court no discretion
in the matter. No hearing rs TO the facts IL re-
CURED, and the statute does not provide
that the defendant shall be notified or the
application. The proceeding Is one which
contemplates the taking OF property without due
process OF law. Due process OF law consists OF
two things: First, notice to appear, and second,
an opportunity to be heard when you do appear.
A statute which does not give the individual or
corporation q chance to be heard when property
Is at stake comes IN conflict with the fundamental
law OF the land and is void. The General Assem-
bly, cannot deprive one OF his property by legisla-
ton. There must be judicial determination of
his rights. II the Legislature does attempt sucn
thing 1t Is the right, 1t is the
duty, OF the judiciary to declare the
act void. A different construction would render
constitutional restrictions and prohibitions wholly
imperative. ana invest the Legislature with su.
preme power. II, therefore, he was right IN his
Construction OF the twenty -niutn section OF TINS
statute, that there Is no provision Or hearing and
that that fatal omission canuot be cured by vol
untary offer o sucn he aring then the proceedings
which have been inaugufated here are without
due process OF law. and therefore VOID. million
Of assets IS TO be transferred from Board Of fifteen
responsible directors and put INTO the hands Of an
destroys or affects vested rights. Seven Thousand
policies have been issued BY the American National
Lie Insurance Company IN strict accordance with
the law. THESE policies were Issued before tue
act OF 1871 was passed. The rights thus vested
Cannot be inirnged upon In manner to do lnjus-
tice or commit wrong. The Legislature virtually
says:-"We VIII lay our hands upon you and seize
your property unless You have twice as much
ton q your il THIS THIS does not sset
vested rights, then as q lawyer ne did not know
he quoted numerous decisions to show under
what circumstances vested rights might be dis
the law In question impaired the obligation
constitutional: 1t Is proposed, ne said, to
appoint trustee to take possession OF
company and procure the reinsurement OF the
policy holder IN otber companies. Il IL proposed
tract Tor you" Instead OF paying John Smith the
sum OF $4,000 when he dies IT ls proposed TO secure
! pany, II one can be found TO take the risk. He
claimed that II would be contrary to justice and
GOOD policy to concede that such power existed,
and ne further claimed thai Legislature had no
power to arbitrarily dissolve or crush out cor.
and repeal Charter exists with I' limitations IS
which must be observed and respected. In con.
prpsry ana due
| OF law; second, that 1t disturhs vested rights;
on yoaoa Of nasra usee
lastly, that to the power to amend or repeal
charter there exists certain well-deaued l,mlta.
| :tons.
| REPLY OF THE COMMISSIONER
81. y. Harrison. Tor the Commissioner, said he
was called on to answer grave questions, prepared
and elaborated upon az leisure STILL he had no
doubt he could establish certain principles upon
Assembly has said you must do such and such
things and you cannot refuse TO- obey
|
statute IS Unconstitutional beyond ali reasonable
doubt. He cited authorities in support OF this
should understand just What the case Ia. Tue
General Assembly has seen Lit to adopt certain
which policy is seen in the statute Of 1871. BY
| that statute State ofiicer is empowered to ln-
II any asa se
are less than tnree,iourtns OF the liabilities then
81 snS nSs ne INTO DosS Ss Of sSs
state. 1t was adopted to protect the
uea are entrsy Is
made to the Judge OF Probate, notice Is Rlven and
1 sns psa y ay any
ton. The Insurance Commissioner has presented
mis- petition 70 the Court Of Probate, asking the
ants TO appear and be heard. On fling his appli.
cation the defendants came IN and said the Court
should not near the application. Tney claim that
you have no jurisdiction In the matter. We say
you have. This principle should be borne In mind,
which would make tt Constitutional, and is also
open to u construction which would make 1t un-
constitutional Your Honors must hold 10 the con
struchon which makes II constitutional. There
can be no question OF the right OF the General Az
semb4y to repeal the charter OF corporation. 1t
Is intimated by counsel Tor the company that II a
corporation Is organized, and somebody IL found
TO make q contract with 1t, then 1t is above the
power Of the Legislature. All contracts with cor
porallons are made suDservlent to tue action OF
private act. to alter or repeal a caarter is abso.
lutte. Il may exercise such power arbitrarily, but
lows TINS general prnclp,es The company may be
dead but the properly exists, and it becomes a
trust iund. Ihe people have rigats IN such funds
oi which IL Is not In the power OF the Legislature
to deprive them. The over OF the company may
be taken away, but the vested rights OF the trust
iund remain. The power 10 dissolve q corporation
involves the power OF appointing q trustee. The
Appointment follows as matter OF necessity. The
trustee holding the bare legal title to the fund
must distribute the fund. There ore the General
Assembly may lawfully provide for its dis
trlpuiion. All the various powers sought to
be exercised ny this statute result ultimately
and logically from the power to repeal and
amend thc charter oi TINS corporation, even to its
dissolution. Nj. HARRISON quoted many authorl.
ties III maintenance OF his theories, and in re.
viewing the statute as Is related 30 this case,
e1oquently demonstrated It's constltuttonYltty,
ECRgnEn ARGuMkNT For TIE COMPANY.