Iowa state bystander. [volume] (Des Moines, Iowa) 1894-1916, 1903-10-23
END OF TIE anti ].
COMPACT STATUTE
Judge Mcpherson Held That
the Blanchard Law Is In
constitutional.
they MAY AGREE ON RATES.
No Law Il Valid IL Iowa Which Pro-
h;bits the Making Of Contracts.
Says the OPINION OF the Federal
Court

VIZ D0o SAOAUSDs w. 6Vs- y O08U tASSA NOs !
son has rendered IN opinion IN which
he holds TINT the anti-compact law.
which was placed on the statute bo0..s
OF Iowa In tine year la96, 10 invalid
and Its provisions cannot be enforced
by the state auditor. This opinion 10
of far-reachin8 importance, anecnnG
upwards Of . hundred Insurance COM
panies It which IL Was directed and
designed to prevent their entering In
lating to r1tes to be charged for In
surance, TIE amounts Of commissions
to be allowed agents for procuring the
same, or the manner of transacting
Gre insurance In general throughout
the state.
The case which has been decided by
Judge Mcpherson was brought In the
federd courts - test OF the law
which the insurance companies looked
upon a. obnoxious before this passage
and did all Ia their power to prevent
becoming Law. The case is entitled
the Greenwich Insurance company
and others versus B. F. Carroll. state
auditor. It was pending before Judge
Mcpherson, ON the defendants demuF-
rer to . bill In equity, died by the
insurance companies against the de-
PENDANT insurance commissioners OF
the state.
The bill In equity asked that the
defendant be restrained from taking
action against them under certain
statutes OF the state law known az the
anti-compact law. or the Blanchard
statute, on the ground that such stat
utes were void because In conflict
with both the state and federal con-
stitutions. James c. Davis and Geo.
Ii. Carr appeared for the complain
ants and Attorney General Mullan for
the insurance commissioner. with the
result that the law has been declared
Unconstitutional Judge McPherson's
opinion, which IL exhaustive, will be
read with much interest, inasmuch as
one Of the biggest fights on record
was made to prevent the passage Of
the Blanchard law and the companies
have been stubbornly resisting Its pro-
visions in the courts since then.
The statutes complained of are Sec
tions 1854 and 1855 Of the code. The
former section provides that 1t shall
be unlawful for two or more fire in
surance companies doing business in
the state, or for the officers. agents or
employees OF such companies to make
or enter into any combination or
agreement relating to rates to be
charged for insurance, the amounts OF
commissions to be allowed agents for
procuring the same or the manner of
transacting fire insurance in the state.
Penalties and fines are imposed for q
violation Of the statute. The follow
ing section provides that the auditor
shall enforce the law, revolving the
permits of any company violating its
provisions. It was alleged by the
companies that the auditor was about
to proceed against them, and they
therefore asked for q restraining
order. Z
Judge Mcpherson does not hold the
law in question unconstitutional on
the ground that II violates the con-
stitutional provision requiring laws to
be general and uniform in their oper-
alton, but he does hold that the state
auditor has no right to shut out of
this state any foreign insurance com.
pany which he hnds solvent and imam
cially worthy. Should he undertake
to do 90, the proper court will com.
pei him to grant, the authority and
admit such company. This being SO,
he cannot put them out. after they
are once lawfully and rightfully In, ex-
cept by virtue Of the power lodged
with him under Z valid and constitu.
tioraf statute.
This. however, he holds Is not the
all important question to be consid-
cred, but rather that of whether all
companies, foreign and domestic, now
rightfully in the state shall be com.
PEELED to submit to the exactions of
an invalid and unconstitutional
statute. n. l.t N Il